Cape Verde: Foreign debt totals US$720 million this year

14 November 2007

Praia, Cape Verde, 14 Nov – Cape Verde’s foreign debt is expected to total US$720 million by the end of the year, a rise of 7 percent against 2006, according to projections from the Bank of Cape Verde.

Of the total debt, 84 percent is the responsibility of the state and the remainder of the private sector.

According to Cape Verdean news agency Inforpress, the Central Bank of Cape Verde (BCV) considers that foreign debt is far from being at a worrying level, as the figure is “within the country’s payment capabilities.”

Internal debt is expected, according to the BCV, to reach 253 million euros, which is a fall of 4 percent year on year.

Estimates show that the internal debt to gross domestic product (GDP) ratio will thus see a substantial decrease, to 23.4 percent of GDP in 2007, as compared with 27.5 percent in 2006.

The BCV said that the positive development of internal debt was mainly a reflection of the policy to reduce the debt and pay off outstanding loans within the scope of the Policy Support Instrument (PSI), signed between the government of Cape Verde and the International Monetary Fund (IMF), the final aim of which is reduction of the stock of internal debt to 20 percent of GDP by 2009. (macauhub)