A recent report by Women in Informal Employment: Globalizing and Organizing (WIEGO) sheds light on the plight of 850,000 Ghanaians, primarily women, who were thrust into extreme poverty in 2022.
The report attributes this alarming trend to various factors, including soaring levels of government debt and the closure of international markets to Ghana.
Conducted in October 2023, the research reveals that despite Ghana’s modest recovery from the COVID-19 pandemic in 2021, a significant portion of the population remained vulnerable to inflationary pressures, resulting in a cost-of-living crisis.
The closure of international markets, coupled with global disruptions to the supply chain due to the war in Ukraine, contributed to a sharp depreciation of the cedi. Given Ghana’s heavy reliance on imports, this situation exacerbated inflationary pressures, ultimately pushing nearly 850,000 Ghanaians below the poverty line in 2022.
The inflation rate, which averaged 35 percent at the time of the research, was particularly pronounced in essential commodities such as food, non-alcoholic beverages, health services, housing, water and electricity, transport, and education.
“While the economy had slightly recovered from the pandemic in 2021, high levels of government debt, the closure of international markets to Ghana, and global disruptions to the supply chain as a consequence of the war in Ukraine all led to a steep depreciation of the cedi (ITA, 2023).
“Considering the country relies heavily on imports, the situation resulted in high inflationary pressure. In 2022, nearly 850,000 Ghanaians were pushed into poverty due to rising prices (Kwakye et al., 2023: 44).
“By the time this research was conducted (October 2023), the inflation rate averaged 35 per cent. It was particularly high for food and non-alcoholic beverages (+45), and other necessities like health services (+28), housing, water and electricity (+25), transport (+25), and education (+13) (GSS, 2023a:7).”
The report highlights that workers in informal employment, constituting 89 percent of the national workforce (83 percent in Accra), bear the brunt of the cost-of-living crisis. These workers often lack access to crucial safety nets, including pension and poverty relief programs, cash transfers, and microfinance schemes, leaving them particularly vulnerable to economic shocks.
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