Cape Verdean economy grew more than 17% in the third quarter

The growth of the Cape Verdean economy accelerated again in the third quarter, more than 17%, after 16.8% in the first three months and 17.7% in the second quarter, indicate provisional data released today by the National Institute of Statistics.

According to the Quarterly National Accounts report by the National Institute of Statistics (INE), Cape Verde’s Gross Domestic Product (GDP) grew 17.1% in volume in the third quarter, a performance that compares with the 10.1% growth in the same period of 2021 and in view of the 18.1% drop in the third quarter of 2020, then due to restrictions to contain the covid-19 pandemic.

According to INE, on the demand side, this result “is explained, to a large extent, by the increase in private consumption and exports, while on the supply side, the Gross Value Added (GVA) at base prices, showed a year-on-year evolution positive of 16.8%, “with emphasis on the activities of Accommodation and Restaurants, Transport and Trade.”

“Tax net of subsidies showed a year-on-year evolution of 19.4%,” says the report.

In the same period, from July to September, consumption – public and private – increased, year-on-year, by 4.8%, investment grew by 16%, exports increased by 108.5% and imports by 33.4%, translating into in a growth of 17.1% of the GDP.

The accommodation and catering sector contributed the most to this performance, growing by 394.3% in the third quarter, in GDP volume, compared to the same period in 2021, followed by transport, with 43.1%, and construction, with 38%, while agriculture dropped 14.3% and fishing dropped 28.8%.

Cape Verde is recovering from a deep economic and financial crisis, due to the sharp drop in tourist demand – a sector that accounts for 25% of the archipelago’s Gross Domestic Product (GDP) – since March 2020, due to the restrictions imposed to control the covid-19 pandemic.

In 2020, the country experienced a historic economic recession, equivalent to 14.8% of GDP, followed by economic growth of 7% in 2021, driven by the recovery in tourist demand in the fourth quarter.

Meanwhile, due to the economic consequences of the war in Ukraine, the Cape Verdean government revised its forecast for economic growth in 2022 from 6% to 4%, but at the end of October it revised that forecast again to at least 8%, in view of the strong tourist demand.

With information from MSN/Lusa