Cabo Verde’s economy expected to grow by between 1.5 pct and 2.5 pct in 2014

29 May 2014

Cabo Verde’s (Cape Verde) economy is expected to grow by between 1.5 and 2.5 percent in 2014, with inflation of around 0.5 percent according to a recent document from the archipelago’s central bank, which outlines a moderate economic recovery.

In its Monetary Policy Report, the Bank of Cabo Verde said that a more favourable external context was expected to drive consumption and private investment, which would contribute to a recovery in GDP growth in 2014.

“Optimism around the current outlook for economic growth is, meanwhile, contained, given the prospect of slight recovery of the external context and continued risks of deterioration of results for national banks, which (…) could adversely affect their loan policies,” the report said.

According to the report the archipelago’s net foreign reserves reached a historical high of 347 million euros, which is enough to cover five months of imports.

The central bank said that the country’s foreign accounts had developed “very favourably” mainly as a result of a drop in imports and dividends sent to foreign investors as a result of weakening of economic activity since 2011.

The Bank of Cabo Verde also said that, as well as net foreign reserves reaching a new high, the current account deficit also fell from 11 percent to 3 percent of Gross Domestic product (GDP). (macauhub/CV)