IMF projects Cabo Verde’s economy to grow 3.2% in 2016

1 December 2016

The economy of Cabo Verde (Cape Verde) is expected to see real growth of 3.2% this year, supported by foreign direct investment, domestic demand, agriculture and tourism, as well as a slight recovery in Europe, said the International Monetary Fund (IMF) in a report released on Wednesday in Washington.

The growth forecast in 2016 is contained in the final report of the technical mission that visited Cabo Verde in October in which it forecasts that the archipelago will grow 3.7% in 2017 and 4.1% in the years 2018, 2019 and 2010.

The report notes the beginning of the recovery of consumer and investor confidence, expects inflation will remain stable and points out that in 2015 economic growth was only 1.5%, four tenths of a percentage point lower than the rate of 1.9 % recorded in 2014.

In the first half of 2016, tourism growth remained robust and foreign direct investment accelerated, reflecting a large increase in planned projects, according to the report.

The report notes a decrease in the budget deficit to 4.1% of GDP in 2015, about 3.4 percentage points lower than a year earlier, mainly because of better revenue performance.

Total financial requirements (including loans to public enterprises) decreased by 2.3 percentage points to 8.3% of GDP due to a reduced investment programmes intended to slow the accumulation of public debt.

“Total public debt reached an estimated 125.8% of GDP at the end of 2015, reflecting an increase in public investment with external financing since 2008, along with slow growth, falling prices and the recent appreciation of the US dollar,” said the IMF. (macauhub)