Cabo Verde faces a high risk of public over-indebtedness

21 November 2018

Cabo Verde (Cape Verde) continues to face a high risk of over-indebtedness, the spokesman for the Budget Support Group (GAO) said on Tuesday in Praia according to the archipelago’s press.

Joel Muzina conceded that the upward trend in public debt as a percentage of Gross Domestic Product (GDP) had slowed in 2017 but underscored the fact that public debt, is currently equivalent to 126% of GDP, and as such remains high.

In order to consolidate last year’s gains and reduce the high risk of external over-indebtedness, the GAO challenged the government to boost revenue collection and adopt measures to contain the pace of growth of scheduled expenditure, while preserving those related to social and critical sectors.

The spokesman said the assessment of debt risks related to loss-making state-owned companies was equally crucial and had encouraged the government to quickly complete the privatisation process of Cabo Verde Airlines (TAAG), according to the Inforpress news agency.

Members of the GAO – the African Development Bank, the European Union, Luxembourg, Portugal and the World Bank – who were in Cape Verde from 14 to 20 November for the second evaluation mission, focused on assessing compliance with the general eligibility criteria for budget support, implementation of the Strategic Plan for Sustainable Development (PEDS) and reforms in various sectors such as security, employment and employability, water, sanitation and energy. (macauhub)