The Bank of Cabo Verde has revised its economic growth forecast for 2019 from 4.7% to 5.2% due to “recent economic developments” and “expectations about macroeconomic policies,” according to the bank’s monetary policy report.
The latest National Accounts figures released by the National Statistics Institute show that Cabo Verde registered economic growth of 5.5% in 2018 and 7.6% in the final quarter of last year.
The document said that economic activity accelerated in 2018, and growth, which compares with a rate of 4.0% in 2017, was boosted by the effects of the continuous implementation of reforms in the tax administration and the special tax debt recovery schemes, as well as external influences.
“The external accounts have also improved due, among other factors, to the reduction of the trade deficit of goods and services and a decrease in income paid to non-resident investors, with net international reserves increasing by about 8 million euros, guaranteeing about 5.6 months of imports of goods and services,” the report said.
The report added that public accounts performed better and the overall deficit was reduced from 3.1% to 2.6%. As a result of the containment of the State’s financing needs and accelerated growth of the nominal product, public debt was reduced from 126.6% to 123.4% of Gross Domestic Product.
The document released by the Cape Verdean central bank predicts that the average annual inflation rate for 2019 will fall to 0.9%, below the forecast of 1.4% expected in October 2018, due to an expected significant drop in prices of raw materials on international markets and the more recent trend of falling prices of unprocessed food. (Macauhub)