Cabo Verde’s Finance Minister says public debt is “huge”

19 May 2017

Cabo Verde’s (Cape Verde’s) public debt is “huge and excessive” but “not unsustainable,” said Finance Minister Olavo Correia, adding the government was working to reduce its value as a percentage of gross domestic product (GDP), according to the Inforpress news agency.

Figures released by weekly newspaper A Semana showed that Cabo Verde’s public debt increased from 200.013 billion Cape Verdean escudos (US$2.015 billion or 127.8% of GDP) in 2015 to 210.726 billion escudos (US$ 2.124 billion or 128.6% of GDP) by 2016.

The 2016 debt can be broken down into external debt in the amount of 158.210 billion Cape Verdean escudos (96.5% of GDP) and domestic debt of 52.516 billion Cape Verdean escudos (32.0% of GDP).

Domestic debt consists of Treasury Bonds (96.6%) and Other Loans (3.4%) and long-term foreign debt, in its entirety, can be broken down into multilateral (46.9%), bilateral (22.6%) and commercial (30.5%).

The Minister of Finance also told Inforpress that the archipelago’s public debt “is not unsustainable” and added that its reduction, as a percentage of GDP, involves “economic acceleration and further streamlining in selection of public investments.”

Correia also said that debt sustainability “is essential”, in order to have a more economic and stable fiscal framework, which in his view “is essential” for the growth of the Cape Verdean economy. (macauhub)