The International Monetary Fund (IMF) has revised its economic growth projections for Cape Verde, raising its estimates by 1.3 percentage points for 2024 and 0.3 percentage points for 2025. The updated forecasts were shared by an IMF mission visiting Praia as part of the biannual review of Cape Verde’s financing programs.
In its latest assessment, the IMF now predicts the country’s economy will grow by 6% in 2024, up from the previous estimate of 4.7%. For 2025, growth is expected to reach 5%, slightly higher than the earlier projection of 4.7%. This improvement marks a significant turnaround, transforming what was initially forecast as a slowdown in GDP growth—from 5.1% in 2023 to 4.7% in 2024—into an upward trend.
Cape Verde’s revised projections place it well above the average growth forecast for sub-Saharan Africa, which the IMF estimates will expand by 3.6% in 2024 and 4.2% in 2025.
The IMF attributed much of the upward revision to a robust rebound in tourism, which outperformed earlier expectations. “Tourism is growing significantly, imports were lower than anticipated, and exports exceeded expectations,” stated Justin Tyson, the head of the IMF mission. He added that the “current account deficit will also be much smaller than initially predicted,” signaling a more positive economic outlook.
Additionally, inflation is forecast to remain below 2% in 2024, converging with levels in the eurozone over the medium term. The current account deficit is expected to stabilize at around 2.5% in the medium term, reflecting stronger economic fundamentals.
The IMF’s revised forecasts align closely with those of the Bank of Cape Verde (BCV), which earlier in November raised its growth estimates to 6.1% for 2024 and 5.6% for 2025. BCV Governor Óscar Santos noted the adjustments were largely driven by the better-than-expected performance of the tourism sector and a rise in private consumption.
“Latest data indicate that we will achieve growth of 6.1% in 2024, supported by service exports and private consumption dynamics,” Santos said during a press conference in Praia. Growth for 2025 and 2026 is projected to moderate to 5.6% and 5.3%, respectively, but remains slightly above the nation’s potential GDP growth rate.
Both institutions agree that Cape Verde’s economic recovery is on a solid trajectory, bolstered by a thriving tourism sector and improving trade balances. As the country channels savings into key sectors such as health, education, and infrastructure, its ability to sustain above-average growth within the region will depend on continued structural reforms and investment in resilience against external shocks.