INTERNATIONAL MONETARY FUND PREDICTS 7.75% GROWTH FOR 2008
The International Monetary Fund has forecast economic growth on the order of 7.75% for Cape Verde in 2008, an estimate similar to the government’s 7.5%-8% projections.
For the IMF, which yesterday published various documents and memorandums regarding the third revision of its Policy Support Instruments, the growth in the Cape Verdean economy will be motored by investments in tourism and “other sectors,” as well as by investments in public infrastructures. The IMF forecasts an inflation rate of 2%.
The Bretton Woods institution estimates the country’s growth in 2007 to have been 7%, with the consumer price index having risen some 5%.
The government’s macro-economic policies, says the IMF, will be focused on four areas in 2008: the consolidation of macro-economic stability through the reduction of the public debt and the increase in net international reserves at the Bank of Cape Verde, improvement in the financial management of the public sector, the reduction of tax risks, and the reinforcement of regulation and supervision in the financial sector. These are among the tasks the IMF considers vital for Cape Verde, which, as it highlights, has graduated from the UN’s list of Least Developed Countries, to become “less dependent on international aid in the future” and “less vulnerable to external shocks.”
The institution guarantees, however, that “recent economic indicators show strong growth, a drop in the unemployment rate and modest inflation.”
Also among the priority policies for 2008 is reform in the energy sector. Among the IMF’s recommendations that are also part of government policy are the creation of standard rates for electricity and the creation of a petroleum-derived fuel price adjustment mechanism.
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