European Union concerned about Cabo Verde’s financial situation

25 November 2013

The European Commission delegate in Cabo Verde (Cape Verde), Portuguese diplomat José Pinto Teixeira, last week said he was concerned about the archipelago’s financial situation, but gave assurances that the European Union would continue to support the West African island nation.

According to Portuguese news agency Lusa, Pinto Teixeira was speaking at the end of a meeting with José Maria Neves, as part of the Cape Verdean Prime Minister’s visit to Brussels, to take part in a round of talks on development on 26 and 27 November.

Saying that the macroeconomic situation of the countries that received budget aid “is always closely followed,” the diplomat noted that Cabo Verde has taken on debt to provide the country with infrastructure and that this effort had coincided with the international crisis, “which made the situation worse.”

The ambassador noted that the EU had a cooperation programme in place with Cabo Verde that involved substantial budget aid, and that this support would represent a financial commitment of 55 million euros over the next six years.

The Budget proposal for 2014, discussion of which began Thursday in Cabo Verde’s parliament, outlines that the public debt ratio will rise from 92 percent of gross domestic product (GDP) in 2013 to 98.2 percent, as a result of maintaining the Public Investment Programme at high levels.

The Budget proposal includes expenditure in the equivalent of 524.1 million euros, revenues of 404.5 million euros, GDP growth of between 3.5 and 4.5 percent and a public deficit of 7.4 percent of GDP (0.1 percentage points more than expected for 2013) and is based on a rate of inflation of between 2 and 3 percent in 2013. (macauhub)