A man sorts fishing nets in Santa Maria, Cape Verde. The World Bank's partnership strategy with Cape Verde focuses on enhancing the West African country's macrofiscal stability for sustained growth, as well as improving competitiveness and strengthening the private sector. Photo by: IDS.photos / CC BY-SA
Cape Verde has made considerable progress in economic development with gross domestic product growth rates averaging 7.1 percent from 2005 to 2008. However, the country lost its momentum following the 2009 recession, and GDP growth has been modest since.
While GDP growth levels are still far from what they were in the past decade, the overall outlook for the West African country remains positive. Poverty incidence dropped from 37 percent to 27 percent between 2002 and 2010, with extreme poverty declining from 21 percent to just 12 percent over the same period thanks in large part to the booming tourism sector. The challenge will be to replicate past successes in socio-economic development in the face of less-favorable global economic conditions.
The government of Cape Verde is well aware of this and aims to ensure sustained, inclusive growth through its third Growth and Poverty Reduction Strategy Paper, which lays out its short and medium-term plans for macroeconomic management as well as structural reforms that are targeted toward increasing the country’s productivity.