Cape Verde’s economy growing

São Vicente Island, Cape Verde

Cape Verde’s domestic demand indicator, after a slowdown in late 2014, showed a slightly faster pace of growth in the first two months of the year, mainly determined by changes in gross fixed capital formation (GFCF), according to the Bank of Cabo Verde.
The investment indicator (GFCF) continued the recovery started in 2014, showing some stabilization in growth since November 2014. The greater dynamism of GFCF was supported by increases in imports of construction goods and equipment, continuously driven by the public sector and foreign investment.
Internal financing conditions remained negative for the domestic private sector, while externally the indicators of financial markets in the Euro Zone continued to show a trend of slight relaxation of the restrictions.
In a recently released document, the archipelago’s central bank also noted that domestic demand continued to support the momentum of economic activity, given that external demand remained unfavorable.
The bank also said the consumption indicator continued the upward trend it had been following since the end of 2014, supported by consumption of durable goods.
According to the document, tourism revenues captured by banks decreased by 19.1 percent, despite an increased supply capacity and prices in the sector.
Structural constraints (infrastructure, taxation and diversification of supply), which limit the capacity of Cape Verdean operators to compete with other markets, may be contributing to these results, the Bank of Cabo Verde said. MDT/Macauhub