Gambia’s Economy Sees 3.2% Growth Rate in 2021 Despite Challenges

Banjul, The Gambia - The Central Bank of The Gambia (CBG) has announced that despite the challenges posed by the COVID-19 pandemic, the Gambian economy is expected to grow by 3.2 percent in 2021.

Growth Rate Premised on Rebound in Key Sectors

The growth rate is premised on a rebound in key sectors such as:

• Accommodations
• Education
• Health
• Retail trade

These sectors are expected to drive economic growth, with the industrial sector projected to have grown by 2.5 percent in 2020.

Challenges Faced by the Economy

The Gambian economy faced significant challenges in 2020, including:

• Decline in tourist arrivals due to the pandemic
• Drop in foreign exchange earnings
• Weak dalasi against major international currencies
• Decrease in remittance inflows

Foreign Exchange Market Resilience

Despite these challenges, the CBG report highlighted that the country’s foreign exchange market remained resilient, characterized by:

• Adequate foreign currency liquidity
• Stable exchange rate

The dalasi weakened against major international currencies due to a decline in remittance inflows and pick-up in economic activity in the last quarter of 2020.

Fiscal Operations Show Worsening Position

The government fiscal operations showed a worsening position in 2020, attributed to:

• Increase in both current and capital expenditures
• Widening budget deficit (including grants) to D4.3 billion (4.3 percent of GDP)
• Basic balance deficit deteriorating to a deficit of D4.5 billion (4.6 percent of GDP)

CBG Remains Optimistic about Economic Prospects

Despite these challenges, the CBG remains optimistic about the country’s economic prospects, citing:

• Expected rebound in key sectors
• Support from development partners
• Stable dalasi exchange rate expected for the remainder of 2021

Overall, the CBG expects the Gambian economy to continue growing despite the challenges posed by the pandemic.