As a very small island economy in the Atlantic Ocean situated in the Sahelian belt off the coast of Senegal in Western Africa, Cape Verde has managed to defy the odds and transform itself from an extremely poor country into one of the better performing economies in Africa in just over three decades. The history of Cape Verde is very much one of the connections to other places. Human and natural resources circulated between the African coast and the islands and from there to Europe, the Americas, Brazil, and the Caribbean Islands. There are only nine significant islands in this West African and Atlantic archipelago, and their joint population is around half a million. In the 21st century or present-day Cape Verde is known as a popular tourist destination for its glorious powder-white beaches and turquoise shores.
The success of the transformation of Cape Verde is rather owed to the last 35 years and the three phases which it was divided into, the period from independence in 1975 to 1990 when the nation’s foundations were laid, a second from 1991 to 2000, and the current decade. Through these three phases, the policies of successive governments have supported the common characteristics of prudent public resource management and sound public institutions, combined with strategies that were adapted to the changing global economy. All these positive changes were noticed then by former African Development Bank Group (AfDB) Donald Kaberuka which said that “the country is poised to achieve most of the Millennium Development Goals”. However, nothing in the world can be quintessential or pristine so there are some challenges too. Poverty, unemployment, lack of diversification affects a large part of the population and infrastructure is still poorly developed. The country also struggles with drug traffickers, and income inequality and social exclusion remains critical. To add further distresses Cape Verde finds itself in the Sahel climate system which is subjected to periodic droughts and very low annual precipitation. With global climate change, drier and hotter weather patterns are forecasted, and this can be detrimental for the environmental degradation that is caused by soil erosion, low fertility, and deforestation. The unique characteristics, especially its geography and miniature size, makes it difficult for agriculture labour because of the lack of rain but also due to the nature of the geography of the islands with it causing famine in 1975. It led to the migration of people out of the country and now there are many more people of Cape Verdean descent living outside than inside the country due to the sporadic famine.
On the Neil economic scale, a can of coke cost 140$00 Cape Verdean Escudo (R 25, 45) and the price of litre petrol is 101$60 Cape Verdean Escudo (R 18, 42). The inflation rate for consumer prices in Cape Verde moved over the past 35 years between -2.5% and 11.2%. For 2019, an inflation rate of 1.1% was calculated. According to the updated IMF forecasts from 14th April 2020, due to the outbreak of the COVID-19, GDP growth is expected to fall to -4% in 2020 and pick up to 5.5% in 2021, subject to the post-pandemic global economic recovery.
Despite the problems, the country has had many remarkable achievements in its economic and social development. In 2004 Cape Verde’s was elevated from the group of Least Developed Countries (LDCs) to Middle-Income Country (MICs) and became the first country in the world whose upgrade is an outcome of efficient and well developed economic and social policies and strategic partnerships with a variety of countries and institutions. The country is fast becoming a development showcase and a source of hope for the continent and boasts West Africa’s highest standard of living. This makes it a very safe, welcoming, and friendly country to visit, just one of the reasons the archipelago is so popular with holidaymakers.