Cabo Verde’s public debt reaches 114.7 percent of GDP

15 May 2015

The public debt of Cabo Verde (Cape Verde) stood at 114.7 percent of GDP at the end of 2014, the Budget Support Group (BSG) indicated on Thursday, recommending that the government continue to follow economic policies that guarantee sustainability of the debt.

The recommendation is included in the final statement of a 2-13 May BSG mission to Cabo Verde to examine sector programmes negotiated with the country’s partners, reports Lusa news agency. During the trip the group members discerned signs of a slowdown in the public investment programme.

The BSG explained that the lower weight of public debt will be “crucial” for the country to access international financial markets, which is “assumed to be ever more important in line with the ongoing reduction of public development assistance.”

The BSG mission affirmed that continual improvement of the business environment is a “vital question” for strengthening the private sector and enhancing the ability to attract investment. The second BSG mission this year will take place in November.

The document acknowledges that 2014 was a “difficult” year for Cabo Verde, especially for the most vulnerable population directly affected by the volcanic eruption and drought. It nevertheless stated that the economy grew faster than expected, based on estimates for 2013 and 2014, sustained by the recovery of direct foreign investment and more remittances from emigrants.

The members of the Budget Support Group for Cabo Verde include the African Development Bank, World Bank, European Union, Luxembourg, Portugal and Spain. (Macauhub/CV)