Ghana boasts best performing stock index

Ghana’s benchmark stock index, Africa’s best performer last year, is set to extend gains in 2025 as investors bet incoming President John Mahama government will restore economic stability.

The Ghana Stock Exchange Composite Index rose 56 percent in local-currency terms — the most since 2013 — aided by a US$3 billion International Monetary Fund bailout that’s expected to support growth this year.

An economic recovery in Ghana may lure investors again this year, according to Nana Kofi Agyeman Gyamfi, head of wealth management at Bora Capital Advisors Ltd.

Ghana’s gross domestic product expanded an average 6,3 percent in the first nine months of 2024, compared with 2,6 percent a year earlier.

Mahama was elected last month after pledging measures to restore Ghana’s status as the region’s second-biggest economy.

“The worst is behind us,” said Alex Boahen, head of research at Accra-based Databank Group, which manages about US$1 billion in assets.

“We expect the general confidence to improve in tandem with the improvement in the economy,” he said, predicting that the Ghanaian index will gain 45 percent in 2025.

Optimism about the outlook for other key countries in the region, including Ivory Coast and Nigeria, helped buoy their stock markets last year.

In neighbouring Ivory Coast, the BRVM Composite Share Index that groups companies from the eight-member West African Economic and Monetary Union, advanced 29 percent in 2024, the biggest jump in three years. The IMF in April agreed to lend US$3,5 billion to the world’s biggest producer of cocoa. The fund forecasts Ivory Coast’s economy will expand 6,4 percent in 2025, paced by record cocoa prices and the start of new oil and mining projects by companies including Eni SpA and Vancouver-based Montage Gold Corp. About 74 percent of the 47 companies listed on the regional bourse are Ivorian.

In addition, banks have started lending again in Ivory Coast and Senegal, said Famara Ndiaye, a fund manager at Abco Bourse in Dakar, the capital of Senegal. That indicates an economic recovery, he said.

In Nigeria, the benchmark stock index gained 38 percent, helped by President Bola Tinubu’s move to allow the nation’s currency to trade freely, end fuel subsidies and government control of tariffs set by power firms.  — Bloomberg.