Cape Verde Economic Insights: Trends, Data, and Future Outlook

Cape Verde's Economic Resilience and Growth 

Cape Verde, officially known as Cabo Verde, is a small island nation located approximately 500 km off the west coast of Africa. Despite its geographical isolation and limited natural resources, the country has demonstrated remarkable economic resilience and steady growth over the past decades. Comprising ten volcanic islands, nine of which are inhabited, Cape Verde has a population of around 491,233 (2021 census). The nation's economy is primarily driven by tourism, services, remittances, and a growing focus on the blue economy.

Historically, Cape Verde has faced significant challenges, including water scarcity, reliance on food imports, and exposure to external economic shocks. However, through sound governance, prudent fiscal policies, and international partnerships, the country has successfully transitioned from a low-income to a middle-income economy. Investments in infrastructure, renewable energy, and digital transformation have further supported sustainable development.

Tourism remains the backbone of Cape Verde's economy, contributing a substantial share to GDP and employment. The country welcomed a record-breaking 1 million tourists in 2023, solidifying its position as a prime destination in West Africa. Meanwhile, strategic initiatives in agriculture, fisheries, and renewable energy are diversifying economic activity and enhancing resilience against climate change.

With ongoing economic reforms and a commitment to sustainable growth, Cape Verde is positioning itself as a regional leader in stability and investment potential. This report provides an in-depth analysis of the country's economic landscape, covering key indicators, sectoral developments, and future prospects.

Economic Overview

Cape Verde's economy has demonstrated remarkable resilience and growth in recent years, emerging strongly from various global challenges. In 2023, the nation achieved a growth rate of 5.1%, primarily driven by a record influx of 1 million tourists, which significantly bolstered the services sector. This positive trajectory continued into 2024, with an estimated growth of 5.2%.

The services sector, particularly tourism, remains the cornerstone of Cape Verde's economy, contributing approximately 25% to the Gross Domestic Product (GDP). The resurgence of tourism to pre-pandemic levels has been pivotal in this growth. Additionally, other sectors such as transportation and public administration have made significant contributions.

Fiscal consolidation efforts have yielded positive results, with the budget deficit narrowing to 0.3% of GDP in 2023, down from 3.9% in 2022. This improvement is attributed to strong revenue performance, leading to a 20-year high primary surplus of 2% in 2023. Consequently, public debt decreased by 10 percentage points to 112.2% of GDP.

The labor market has also shown positive trends, with unemployment declining to 10.3% in 2023, falling below pre-pandemic levels. This improvement reflects the country's ongoing economic recovery and the effectiveness of policies aimed at job creation.

Inflation rates have been favorable, decreasing to 3.7% in 2023, influenced by the decline in international fuel and food prices. Projections for 2024 anticipate a further decline to 1.6%, aligning with moderating global commodity prices.

Looking ahead, the International Monetary Fund (IMF) projects real GDP growth of 6% for Cape Verde in 2024, accompanied by low inflation, a small current account deficit, and an adequate level of international reserves to support the currency peg. The public debt-to-GDP ratio is expected to continue its downward trend, reflecting sustained economic growth and improved fiscal balances.

Despite these positive developments, Cape Verde remains vulnerable to external shocks due to its heavy reliance on tourism and limited natural resources. The government is actively pursuing structural reforms to diversify the economy, enhance resilience, and promote sustainable growth. Key areas of focus include the development of the blue economy, investment in renewable energy, and strengthening the financial sector.

In summary, Cape Verde's economic landscape is characterized by robust growth, prudent fiscal management, and strategic initiatives aimed at diversification and sustainability. While challenges persist, the nation's proactive approach positions it well for continued progress and resilience in the face of global uncertainties.

Cape Verde's Key Economic Indicators

Cape Verde's economy is characterized by several key indicators that provide insight into its current performance and future prospects.

Gross Domestic Product (GDP)

• Total GDP: In 2023, Cape Verde's GDP was approximately $2.7 billion.
• GDP Growth Rate: The economy expanded by 5.1% in 2023, driven by a record influx of 1 million tourists.

GDP Per Capita

• In 2023, the GDP per capita was estimated at $4,502.

Sectoral Composition

• Services: The services sector, including commerce, transport, tourism, and public services, accounts for about 75% of GDP.
• Agriculture and Industry: Agriculture contributes approximately 7.9%, while industry accounts for about 17.9% of GDP.

Inflation Rate

• Inflation decreased to 3.7% in 2023, influenced by declining international fuel and food prices.

Unemployment Rate

• The unemployment rate fell to 10.3% in 2023, below pre-pandemic levels.

Public Debt

• Public debt decreased by 10 percentage points to 112.2% of GDP in 2023.

Trade Balance

• Cape Verde has a trade deficit, with imports exceeding exports. The economy relies heavily on imports for over 80% of its food needs.

Poverty Rate

• The poverty rate declined to 15% in 2023, a 0.5 percentage point reduction from the previous year.

These indicators reflect Cape Verde's economic resilience and the effectiveness of its development strategies. However, the country's dependence on tourism and external factors underscores the importance of ongoing efforts to diversify the economy and enhance sustainability.

Sectoral Analysis: Key Drivers of Cape Verde's Economy

Cape Verde's economy is predominantly service-oriented, with the services sector accounting for approximately 75% of the Gross Domestic Product (GDP). This sector encompasses commerce, transport, tourism, and public services, serving as the primary engine of economic growth.

Services Sector

• Tourism: Tourism is a cornerstone of Cape Verde's economy. In 2023, the country welcomed a record 1 million tourists, significantly bolstering economic activity. The expansion of the tourism industry has spurred growth in related sectors, including hospitality, transportation, and retail. The government continues to invest in infrastructure, such as airport expansions and road networks, to accommodate the growing number of visitors.

• Transportation and Public Administration: Beyond tourism, other service sub-sectors, such as transportation and public administration, have made notable contributions to economic growth. Investments in infrastructure projects, including the modernization of port and airport facilities, have enhanced the efficiency of transportation services, facilitating both domestic and international trade.

Agriculture and Fisheries

Agriculture and fisheries collectively contribute around 8% to the GDP. The agricultural sector faces challenges due to limited arable land and water scarcity, which constrain production. As a result, Cape Verde imports over 90% of its food requirements. Despite these challenges, there are opportunities to enhance agricultural productivity through investments in irrigation, sustainable farming practices, and value-added processing.

The fisheries sector holds potential for growth, given the country's extensive maritime resources. Currently, fish and seafood exports are limited, but there is scope for expansion through sustainable fishing practices and the development of processing facilities. The government has implemented policies to promote responsible fishing and expand aquaculture, which could further boost economic output in this sector.

Industry and Manufacturing

The industrial sector, including manufacturing, accounts for approximately 17% of the GDP. Activities in this sector encompass food and beverage processing, fish processing, footwear and garment production, salt mining, and ship repair. While the sector remains relatively small, there are opportunities for growth, particularly in light manufacturing and agro-processing industries. Foreign direct investment (FDI) in industrial parks and export-oriented production could further stimulate this sector.

Construction

The construction sector has experienced robust activity, driven by numerous infrastructure projects. These include the development of luxury hotels, the modernization of transport facilities, and the expansion of renewable energy infrastructure. The construction boom is also fueled by investments in real estate, particularly in tourist hotspots such as Sal and Boa Vista. Such projects not only stimulate economic growth but also enhance the country's attractiveness to investors and tourists.

Renewable Energy

Cape Verde has made significant strides in renewable energy, aiming to reduce its dependence on imported fossil fuels. Investments in wind and solar energy projects have increased the share of renewables in the energy mix, contributing to energy security and environmental sustainability. The government has set an ambitious goal to generate 50% of its electricity from renewable sources by 2030. Continued investments in energy storage solutions and smart grids are expected to improve efficiency and reduce energy costs.

Digital Economy

The government is actively promoting the digital economy as a means to diversify economic activities. Initiatives include the development of technology parks and the enhancement of information and communication technology (ICT) infrastructure. Digital services, including e-governance, fintech, and online business platforms, are gaining traction and attracting investment. These efforts aim to position Cape Verde as a hub for digital services in the region.

While the services sector, particularly tourism, remains the dominant force in Cape Verde's economy, there are concerted efforts to diversify through investments in agriculture, industry, renewable energy, and the digital economy. These initiatives are designed to foster sustainable economic growth, create jobs, and enhance resilience against external shocks. As Cape Verde continues its economic transformation, a balanced approach to sectoral development will be key to ensuring long-term stability and prosperity.

Fiscal Policy and Public Finance

Cabo Verde has demonstrated a commitment to prudent fiscal management, aiming to balance economic growth with fiscal sustainability. The government's fiscal policy focuses on maintaining macroeconomic stability, managing public debt, and implementing structural reforms to enhance economic resilience.

Public Debt Management:

As of 2023, Cabo Verde's public debt stood at approximately 113% of GDP. This elevated debt level is primarily attributed to substantial public investments in infrastructure and social sectors, as well as external shocks that have impacted revenue streams. The government has been proactive in managing this debt through strategies that include seeking concessional financing, implementing fiscal consolidation measures, and enhancing debt transparency.

Fiscal Reforms and Transparency:

To strengthen public financial management, Cabo Verde has undertaken several reforms aimed at improving fiscal discipline and transparency. These reforms are designed to align with international norms and standards, ensuring budget credibility and thoroughness. The government's efforts have been recognized for their commitment to fiscal transparency, which is crucial for maintaining investor confidence and securing external support.

Revenue Mobilization and Expenditure Management:

The government has focused on enhancing revenue mobilization through tax policy reforms and improving tax administration efficiency. On the expenditure side, efforts have been made to prioritize spending, particularly in areas that promote sustainable economic growth and social development. This includes investments in education, healthcare, and infrastructure, which are essential for long-term economic resilience.

International Support and Partnerships:

Cabo Verde has benefited from support by international partners, including the International Monetary Fund (IMF) and the World Bank, to implement fiscal reforms and strengthen public financial management. These partnerships have provided technical assistance and financial support, facilitating the country's efforts to maintain fiscal stability and promote sustainable development.

Challenges and Outlook:

Despite these efforts, Cabo Verde remains vulnerable to external shocks due to its small size and openness. The heavy reliance on tourism makes the economy susceptible to global economic fluctuations. Additionally, climate change poses significant risks, necessitating the integration of climate resilience into fiscal planning. The government continues to work on diversifying the economy and strengthening fiscal buffers to mitigate these risks.

In summary, Cabo Verde's fiscal policy and public finance management reflect a deliberate approach to fostering economic growth while ensuring fiscal sustainability. Ongoing reforms and international partnerships play a pivotal role in addressing fiscal challenges and building a resilient economic framework.

Monetary Policy and Financial Sector

Cabo Verde's monetary policy is primarily focused on maintaining the stability of its currency, the Cabo Verdean escudo (CVE), which has been pegged to the euro since 1998. This fixed exchange rate regime aims to ensure the convertibility of the CVE, create conditions for price stability, and serve as a credible nominal anchor for monetary policy.

Monetary Policy Framework

The Banco de Cabo Verde (BCV), the country's central bank, is responsible for formulating and implementing monetary policy. To preserve the currency peg and maintain macroeconomic stability, the BCV has taken measures to align domestic interest rates with those of the European Central Bank (ECB). In 2023, the BCV tightened monetary policy to narrow the interest rate differential with the ECB, thereby protecting the peg.

In January 2025, the BCV raised its key interest rate by 75 basis points to 2.25%, continuing its efforts to maintain the fixed exchange rate regime and control inflation.

Financial Sector Overview

Cabo Verde's financial sector is relatively small but has shown resilience and stability. The sector is supervised and regulated by the BCV, ensuring adherence to international banking standards. As of the latest data, approximately 82.8% of the adult population has access to financial services, reflecting a well-penetrated banking system.

The banking landscape comprises several commercial banks, including:

• Banco Comercial do Atlântico (BCA)

• Caixa Económica de Cabo Verde

• Banco Interatlântico

• Ecobank Cabo Verde

These institutions offer a range of services, including retail banking, corporate banking, and investment services, catering to the diverse needs of the population.

Capital Markets

The Bolsa de Valores de Cabo Verde (BVC), established in 1998, is the country's stock exchange located in Praia. By the end of 2017, the market capitalization of the BVC was approximately 68.4 billion CVE (around 621 million euros). The BVC plays a crucial role in facilitating capital formation and providing investment opportunities within the domestic economy.

Challenges and Outlook

Despite the progress made, Cabo Verde's financial sector faces challenges, including:

• High Public Debt: As of 2023, public debt stood at approximately 113% of GDP, necessitating prudent fiscal management to ensure debt sustainability.

• Economic Vulnerabilities: The economy's heavy reliance on tourism makes it susceptible to external shocks, such as global economic downturns and pandemics, which can impact financial sector stability.

To address these challenges, the government and the BCV are focusing on:

• Diversifying the Economy: Efforts are underway to reduce dependence on tourism by promoting sectors like renewable energy, information and communication technology, and fisheries.

• Strengthening Financial Regulation: Continuous improvements in regulatory frameworks aim to enhance the resilience of the financial sector against potential shocks.

• Promoting Financial Inclusion: Initiatives to increase access to financial services, especially in rural areas, are being implemented to ensure inclusive economic growth.

In summary, Cabo Verde's monetary policy and financial sector management are geared towards maintaining currency stability, fostering a robust financial system, and supporting sustainable economic development. Ongoing reforms and strategic initiatives are essential to navigate existing challenges and capitalize on emerging opportunities.

External Sector Analysis

Cabo Verde's external sector is pivotal to its economic framework, given the nation's reliance on tourism, remittances, and foreign direct investment (FDI). The country's geographical characteristics and limited natural resources make it heavily dependent on external economic activities.

Trade Balance

Cabo Verde consistently experiences a trade deficit, primarily due to substantial imports of food, fuel, and capital goods, which are essential to meet domestic consumption and development needs. This deficit is partially offset by revenues from tourism and remittances from the diaspora.

Tourism

Tourism is a cornerstone of Cabo Verde's economy. In 2023, the country achieved a milestone with 1 million tourist arrivals, significantly boosting the services sector. This surge in tourism contributed to a 5.1% GDP growth in 2023. The positive trend continued into 2024, with growth projected at 5.2%, driven by robust performance in the services sector and an improved agricultural year.

Remittances

Remittances from the Cabo Verdean diaspora are a vital source of foreign exchange, accounting for approximately 10.5% of GDP in 2023. These funds play a crucial role in supporting household consumption and contributing to economic stability.

Foreign Direct Investment (FDI)

Cabo Verde's investment climate remains favorable, reflecting the government's stance towards fostering a sound environment for foreign direct investment (FDI).

Current Account Balance

The current account deficit widened from 2.5% to 3.5% of GDP, reflecting higher capital goods imports—primarily driven by public sector and tourism sector investments—as well as a gradual stabilization of exports.

Exchange Rate Policy

Cabo Verde maintains a fixed exchange rate regime, pegging the escudo to the euro since 1998. This policy has provided a stable framework for trade and investment, anchoring inflation expectations and facilitating external transactions.

Challenges and Vulnerabilities

Despite positive developments, Cabo Verde's external sector faces several challenges:

• Dependence on Tourism: The heavy reliance on tourism makes the economy vulnerable to external shocks, such as global economic downturns or pandemics, which can significantly impact tourist arrivals and revenues.

• Climate Vulnerability: As a Small Island Developing State (SIDS), Cabo Verde is susceptible to climate-related shocks, which can affect agricultural output and infrastructure, further influencing the external sector.

• Trade Imbalance: The persistent trade deficit necessitates continuous inflows of foreign exchange through tourism, remittances, and FDI to maintain external stability.

Policy Measures and Outlook

To mitigate these challenges, the government is implementing strategies to diversify the economy, enhance export capacity, and strengthen external resilience:

• Economic Diversification: Investments are being channeled into sectors such as renewable energy, digital economy, and fisheries to reduce dependence on tourism.

• Enhancing Competitiveness: Efforts to improve the business environment aim to attract more FDI and promote the development of export-oriented industries.

• Strengthening External Buffers: Policies to build foreign exchange reserves and maintain prudent fiscal management are in place to safeguard against external shocks.

In summary, while Cabo Verde's external sector has been a driving force behind its economic growth, ongoing efforts to address vulnerabilities and promote diversification are essential to ensure long-term sustainability and resilience.

Challenges and Risks

Cabo Verde's economic landscape, while demonstrating resilience and growth, is confronted with several challenges and risks that could impede its sustainable development. Addressing these issues is crucial for the nation's long-term prosperity.

1. Economic Dependence on Tourism

Tourism remains the primary driver of Cabo Verde's economy, contributing significantly to GDP and employment. However, this heavy reliance exposes the country to external shocks, such as global economic downturns, pandemics, or geopolitical tensions, which can lead to a sudden decline in tourist arrivals. The COVID-19 pandemic underscored this vulnerability, causing substantial economic disruptions. Diversifying the economy is essential to mitigate the risks associated with overdependence on a single sector.

2. Climate Change Vulnerabilities

As a Small Island Developing State (SIDS), Cabo Verde is highly susceptible to climate-related challenges, including:

• Rising Sea Levels: Threatening coastal communities and infrastructure.

• Increased Frequency of Extreme Weather Events: Such as droughts and tropical storms, adversely affecting agriculture and water resources.

These environmental threats not only jeopardize livelihoods but also strain public finances due to the need for increased spending on disaster response and infrastructure resilience.

3. High Public Debt Levels

Despite efforts to reduce public debt, it remains elevated at approximately 113.8% of GDP as of 2023. This high debt burden limits fiscal flexibility and heightens vulnerability to external economic shocks. Continued fiscal consolidation and prudent debt management are imperative to ensure fiscal sustainability.

4. Underperformance of State-Owned Enterprises (SOEs)

Several SOEs in Cabo Verde require substantial government support due to operational inefficiencies and financial losses. This dependence poses significant fiscal risks and diverts resources from other critical areas such as health, education, and infrastructure development. Advancing SOE reforms, including privatization and improved governance, is essential to alleviate this fiscal strain.

5. Limited Economic Diversification

The economy's concentration in a few sectors, particularly tourism, limits resilience against external shocks. Expanding into sectors such as the blue economy, digital services, and renewable energy can provide alternative revenue streams and enhance economic stability. Investing in these areas can also create employment opportunities and promote sustainable development.

6. External Economic Shocks

Cabo Verde's open economy is vulnerable to global economic fluctuations, including:

• Commodity Price Volatility: Fluctuations in global commodity prices can impact import costs and inflation.

• Supply Chain Disruptions: Global supply chain issues can affect the availability and cost of goods.

• Economic Slowdowns in Key Markets: Economic downturns in countries that are primary sources of tourists or remittances can adversely affect foreign exchange earnings.

Implementing policies that enhance economic resilience, such as building foreign exchange reserves and fostering local industries, is vital to mitigate these risks.

7. Social Challenges

Despite economic progress, social issues persist:

• Poverty Rates: A significant portion of the population continues to live in poverty, with extreme poverty affecting 11.1% of households.

• Income Inequality: The Gini coefficient, last estimated at 42.4% in 2015, indicates substantial income disparity.

Addressing these social challenges requires inclusive economic policies, investment in education and healthcare, and targeted social protection programs to uplift marginalized communities.

8. Infrastructure Deficiencies

Inadequate infrastructure, particularly in transportation and energy, hampers economic activities and deters investment. Improving infrastructure is essential to support business operations, enhance connectivity, and attract foreign direct investment. Public-private partnerships and international assistance can play a pivotal role in infrastructure development.

Cabo Verde faces a multifaceted array of challenges and risks that require comprehensive and strategic responses. By diversifying the economy, implementing structural reforms, investing in climate resilience, and addressing social inequalities, the nation can build a more robust and sustainable economic future. Collaborative efforts between the government, private sector, and international partners are essential to navigate these challenges effectively.

Future Outlook

Cabo Verde's economic trajectory in the coming years is poised for stabilization and growth, underpinned by strategic investments and policy reforms.

Economic Growth Projections

The World Bank forecasts that Cabo Verde's economic growth will stabilize at approximately 4.8% during 2025-2026, with inflation converging around 2%.

Similarly, the International Monetary Fund (IMF) projects a real GDP growth of 4.7% in 2025, accompanied by a 2.0% increase in consumer prices.

Fiscal and Debt Outlook

Despite a projected widening of the current account deficit from 2.5% to 3.5% of GDP—attributable to increased imports of capital goods for public and tourism sector investments—public debt is expected to decline to 107.1% of GDP.

This improvement reflects the government's commitment to fiscal consolidation and prudent debt management.

Strategic Development Initiatives

Cabo Verde is actively pursuing several strategic initiatives to bolster its economic resilience and sustainability:

• Climate Action Investments: The country plans to invest approximately $140 million annually from 2024 to 2030 in ambitious climate actions. These investments aim to expand renewable energy capacity, enhance grid efficiency, and strengthen social resilience through improved education and social protection systems. By 2050, such climate actions could result in a 2.5% increase in GDP compared to a baseline scenario.

• Digital Transformation and Energy Transition: In collaboration with the United Nations, Cabo Verde has unveiled a $20 million cooperation plan for 2025, focusing on six priority areas, including digital transformation, energy transition, social inclusion, and environmental sustainability.

• Open Government Reforms: The government's second action plan (2023–2025) comprises eight commitments aimed at increasing government transparency. These include initiatives in open data, budget transparency, public service co-creation, fisheries transparency, and open justice.

Risks and Challenges

While the outlook is positive, several risks could impact Cabo Verde's economic trajectory:

• External Economic Shocks: Potential commodity price spikes due to geopolitical tensions and weaker external demand in tourism markets could undermine fiscal consolidation and weaken growth.

• Climate-Related Shocks: Given the country's high vulnerability, climate-related events remain a significant concern.

• Structural Reforms: Limited progress in the reform agenda for state-owned enterprises (SOEs) could pose challenges to economic efficiency and growth.

In summary, Cabo Verde's future outlook is characterized by strategic investments in climate action, digital transformation, and governance reforms. These initiatives, coupled with prudent fiscal management, are expected to foster sustainable economic growth. However, vigilance is required to navigate potential external and internal challenges that may arise.

Conclusion

Cabo Verde stands at a pivotal juncture, with its economic trajectory shaped by both promising opportunities and significant challenges. The nation's commitment to strategic investments, particularly in climate action and economic diversification, underscores a proactive approach to sustainable development.

Economic Growth and Diversification

Projections indicate that Cabo Verde's economy is set to stabilize, with growth rates estimated at approximately 4.8% in 2025-2026. This anticipated growth is bolstered by sectors such as agriculture, energy, and the digital economy, alongside robust private consumption. However, the nation's heavy reliance on tourism renders it susceptible to external shocks, emphasizing the imperative for diversification. Initiatives aimed at enhancing agricultural productivity, expanding renewable energy infrastructure, and fostering a digital economy are critical to reducing this dependency and building economic resilience.

Fiscal Consolidation and Debt Management

Efforts toward fiscal consolidation have yielded positive outcomes, with the budget deficit narrowing to 0.3% of GDP in 2023. Public debt, while on a downward trajectory, remains elevated at 113.8% of GDP. Continued fiscal prudence, coupled with reforms in state-owned enterprises (SOEs), is essential to mitigate fiscal risks and ensure debt sustainability. The government's strategy includes enhancing tax revenue through policy reforms and pursuing privatization initiatives to improve the financial performance of SOEs.

Climate Action and Sustainable Development

Recognizing the existential threat posed by climate change, Cabo Verde has committed to ambitious climate action, necessitating investments of approximately $140 million annually from 2024 to 2030. These investments are directed toward expanding renewable energy capacity, modernizing the electrical grid, and strengthening social resilience through improved education and social protection systems. By 2050, such proactive measures could result in a 2.5% increase in GDP compared to a baseline scenario, illustrating the economic viability of sustainable practices.

Risks and Challenges

Despite favorable projections, Cabo Verde faces several risks that could impede its economic progress:

• External Economic Shocks: The economy is vulnerable to global market fluctuations, including potential commodity price spikes and weakened demand in key tourism markets.

• Climate-Related Events: As a small island nation, Cabo Verde is particularly susceptible to climate-related shocks such as droughts and rising sea levels, which can adversely affect infrastructure and key economic sectors.

• Structural Reform Implementation: Delays or limited progress in implementing structural reforms, especially concerning SOEs, could undermine fiscal consolidation efforts and economic efficiency.

Strategic Imperatives

To navigate these challenges and capitalize on emerging opportunities, Cabo Verde must:

• Accelerate Economic Diversification: Investing in sectors beyond tourism, such as agriculture, renewable energy, and digital services, will reduce vulnerability to external shocks and promote sustainable growth.

• Enhance Fiscal Discipline: Maintaining prudent fiscal policies, improving tax collection, and managing public expenditures are vital to reducing public debt and creating fiscal space for essential investments.

• Strengthen Climate Resilience: Implementing adaptive strategies and infrastructure improvements will mitigate the adverse effects of climate change and safeguard economic assets.

• Advance Governance Reforms: Improving transparency, efficiency, and accountability within public institutions, particularly SOEs, will enhance investor confidence and operational effectiveness.

In summary, Cabo Verde's path forward is marked by a delicate balance between leveraging growth opportunities and addressing inherent vulnerabilities. Through steadfast commitment to strategic reforms, sustainable investments, and robust governance, the nation is poised to achieve resilient and inclusive economic development.