Economy of Cape Verde


Economy of Cape Verde
Economy of Cape Verde
CPV003.JPG
A One CVE coin
Currency Cape Verdean escudo (CVE)
Fiscal year Calendar year
Trade organisations AU, WTO
Statistics
GDP $1.68 billion (2009 est.)
GDP growth 1.8% (2009 est.)
GDP per capita $3,900 (2009 est.)
GDP by sector agriculture (9.2%), industry (16.5%), services (74.3%) (As of 2009)
Inflation (CPI) 4% (2009 est.)
Population
below poverty line
30% (As of 2000)
Labour force 196,100 (2007)
Labour force
by occupation
N/A (As of 2008)
Unemployment 30% (As of 2008)
Main industries food and beverages, fish processing, shoes and garments, salt mining, ship repair
Ease of Doing Business Rank 119th[1]
External
Exports $102 million f.o.b. (As of 2008)
Export goods fuel, shoes, garments, fish, hides
Main export partners Spain 37.2%, Portugal 29.9%, Morocco 7.0%, United States 6.6%, (As of 2007)
Imports $887 million f.o.b. (As of 2008)
Import goods foodstuffs, industrial products, transport equipment, fuels
Main import partners Portugal 40.7%, Netherlands 10.9%, France 6.5%, Spain 5.6%, Côte d'Ivoire 4.9%, Brazil 4.7%, Italy 4.7% (As of 2007)
Gross external debt $325 million (As of 2002)
Public finances
Public debt N/A (As of 2008)
Revenues $480 million (2009 est.)
Expenses $595.9 million (2009 est.)
Economic aid $136 million (recipient) (As of 1999)
Credit rating B+ (Domestic)
B+ (Foreign)
BB (T&C Assessment)
(Standard & Poor's)[2]
Main data source: CIA World Fact Book
All values, unless otherwise stated, are in US dollars

Cape Verde is a small archipelagic nation that lacks resources and has experienced severe droughts. Agriculture is made difficult by lack of rain and is restricted to only four islands for most of the year. Most of the nation's GDP comes from the service industry. Cape Verde's economy has been steadily growing since the late 1990s, and it is now officially considered a country of average development, being only the second country to have achieved such transition, after Botswana in 1994. Cape Verde has significant cooperation with Portugal at every level of the economy, which has led it to link its currency (the Cape Verdean escudo) first to the Portuguese escudo and, in 1999, to the euro.

Contents

Resources

1000 CVE bank note issued in 1992
Municipal market in São Vicente
Wind farm established through private sector agreement.
ATM in Cape Verde.

Cape Verde's low per capita GDP reflects a poor natural resource base, including serious water shortages exacerbated by cycles of long-term drought. During periods of normal rainfall, only 4 of 10 islands (Santiago, Santo Antão, Fogo, and Brava) support significant agricultural production.

About 90% of food must be imported. Cape Verde annually runs a high trade deficit, financed by foreign aid and remittances from emigrants; remittances constitute a supplement to GDP of more than 20%. Economic reforms, launched by the new democratic government in 1991, are aimed at developing the private sector and attracting foreign investment to diversify the economy. Since 1991, the policies the government has pursued include an open welcome to foreign investors and a far-reaching privatization program.

Fish and shellfish are plentiful, and small quantities are exported. Cape Verde has cold storage and freezing facilities as well as fish processing plants in Mindelo, Praia, and on Sal. However, the fishing potential, mostly lobster and tuna, is not fully exploited.

The economy is service-oriented, with commerce, transport, and public services accounting for almost 70% of GDP. Although nearly 38% of the population lives in rural areas, the share of agriculture in GDP in 2010 was only 9.2% (up from 8.9% in 1995); of the 1998 total, fishing accounts for 1.5%.

The Cape Verdean government established the top priorities for development as the promotion of a market economy and of the private sector; the development of tourism, light manufacturing industries, and fisheries; and the development of transport, communications, and energy facilities. In 1994-95 Cape Verde received a total of about U.S.$50 million in foreign investments, of which 50% was in industry, 19% in tourism, and 31% in fisheries and services. Prospects for 2000 depend heavily on the maintenance of aid flows, remittances, and the momentum of the government's development program.

Mineral industry

Mining is an insignificant contributor to the country's economy.[3] Most of the country's mineral requirements are imported.[3] As of 2007, production of mineral commodities was limited to clay on the islands of Boa Vista, Sal, and São Vicente; gypsum on the island of Maio; limestone on the islands of Boa Vista, Sal, and Santo Antão; pozzolana on the island of Santo Antão; and salt on the islands of Maio and Sal.[3] Cape Verde was not a natural gas or petroleum producer as of 2007.[3]

Transportation

Cape Verde's strategic location at the crossroads of mid-Atlantic air and sea lanes has been enhanced by significant improvements at Mindelo's harbor (Porto Grande) and at Sal's international airport. Ship repair facilities at Mindelo were opened in 1983, and the harbors at Mindelo and Praia were recently renovated. The major ports are Mindelo and Praia, but all other islands have small port facilities, some of which are to be expanded in the near future. In addition to the international airport on Sal, airports are located on all of the inhabited islands. The archipelago has 3,050 kilometers (1,830 mi.) of roads, of which 1,010 kilometers (606 mi.) are paved. The new Praia International Airport is currently operative.

International recognition

Cape Verde is considered a developing country, and is included on the list of the United Nations Small Island Developing States.

In 2007 the United Nations graduated Cape Verde from the category of Least Developed Countries, only the second time this has happened to a country.[4]

On December 18, 2007, the General Council of the World Trade Organization approved a package for the accession of Cape Verde to the WTO. Accession was effective on July 23, 2008, 30 days after ratification by Cape Verde, which took place on 23 June.[5] The package requires Cape Verde to adapt some of its economic regulation. In particular, it will need to introduce a new Customs Code, and to introduce copyright and patent laws complying with the Agreement on Trade-Related Aspects of Intellectual Property Rights.[6][7] According to the World Intellectual Property Organization (WIPO), Cape Verde does not have legislation for industrial property, such as patents, trademarks, and industrial designs but does have a law on copyrights (Law No. 101/III/90, December 1990).[8] Pascal Lamy, director-general of the WTO said, "I am very pleased to welcome Cape Verde as a new member. This new membership will strengthen multilateral trading system. Being part of the WTO will enable Cape Verde to continue its integration into the world economy."[9]

See also

Notes

  1. ^ "Doing Business in Cape Verde 2012". World Bank. http://www.doingbusiness.org/data/exploreeconomies/cape-verde/. Retrieved 2011-11-21. 
  2. ^ "Sovereigns rating list". Standard & Poor's. http://www.standardandpoors.com/ratings/sovereigns/ratings-list/en/eu/?subSectorCode=39. Retrieved 26 May 2011. 
  3. ^ a b c d Newman, Harold R. "The Mineral Industries of Cameroon and Cape Verde" (PDF). 2007 Minerals Yearbook. United States Geological Survey (December 2008)  This article incorporates text from this source, which is in the public domain..
  4. ^ "UN advocate salutes Cape Verde’s graduation from category of poorest States", UN News Centre, 14 June 2007.
  5. ^ "Cape Verde to join WTO on 23 July 2008". WTO News. http://www.wto.org/english/news_e/news08_e/acc_capverde_june08_e.htm. 
  6. ^ WTO press release on Cape Verde's accession
  7. ^ Cape Verde's other accession commitments: Besides Market access for goods and services, WTO, 18 December 2007. "Intellectual property: Cape Verde would apply the TRIPS agreement by January 2013. In light of the Doha Declaration on TRIPS and Public Health, the provisions related to the scope and use of patents and the protection of undisclosed information would be implemented by January 2016."
  8. ^ WIPO, Legislative Profile of Cape Verde Intellectual Property Laws
  9. ^ "Cape Verde joins WTO". afrol News. 2008-07-23. http://www.afrol.com/articles/29957. Retrieved 2008-07-24. 

References

External links


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