Cabo Verde: Request for Disbursement Under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for Cabo Verde
IMF Staff Country Reports, April 23, 2020
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- Cabo Verde: Request for Disbursement Under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for Cabo Verde
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Bibliographic details
- Published: April 23, 2020
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513542263.002
Summary and Purpose
- Presents Cabo Verde’s Request for Disbursement Under the Rapid Credit Facility (RCF).
- Mitigating measures taken by the authorities aim to:
- prevent an extensive spread of the pandemic,
- help the private sector, households and vulnerable groups mitigate the fallouts of the pandemic.
- Important challenges remain due to existing uncovered financing gaps and uncertainties on the duration of the pandemic, calling for financial support from Cabo Verde’s development partners.
- IMF financing under the RCF will provide additional foreign exchange and much-needed budget support.
- While addressing the impact of the coronavirus disease 2019 pandemic, the authorities should stand ready to resume reforms and policies needed to return the economy to its pre-pandemic medium-term trajectory, anchored in:
- sustained growth,
- stronger external and fiscal positions,
- declining ratio of public debt to gross domestic product.
- Medium-term outlook is described as broadly favorable under the assumptions of:
- recovery of the global economy,
- resumption of tourism and capital inflows,
- growth-enhancing reforms envisaged under the authorities’ Plan for Sustainable Development.
Key Findings and Risks
- Policy measures to contain the pandemic and support vulnerable groups are in place but do not fully cover financing needs.
- Uncertainties on the duration of the pandemic amplify fiscal and external financing risks.
- IMF RCF financing is intended to provide:
- additional foreign exchange,
- much-needed budget support.
- The expected return to the pre-pandemic medium-term trajectory depends on readiness to resume reforms and policies.
Policy Recommendations and Priorities
- Secure financial support from development partners to close uncovered financing gaps.
- Use IMF RCF financing to bolster foreign exchange reserves and budgetary capacity.
- Stand ready to resume structural reforms and fiscal policies once pandemic pressures abate, to:
- restore sustained growth,
- strengthen external and fiscal positions,
- reduce the public debt-to-GDP ratio.
Medium-Term Outlook and Assumptions
- Outlook described as broadly favorable conditional on:
- recovery of the global economy,
- resumption of tourism and capital inflows,
- implementation of growth-enhancing reforms under the Plan for Sustainable Development.
Publication and Metadata
- Subject: Central banks, COVID-19, External debt, Fiscal policy, Fiscal stance, Health, International reserves, Loans, Public debt
- Keywords: authority, Banco de Cabo Verde, Cabo Verde's economy, COVID-19, CR, development partner, emergency financing request, financing, Fiscal stance, Global, IMF lending tracker, International reserves, ISCR, pandemic, Western Europe
- Pages: 32
- Volume: 2020
- Issue: 136
- Series: Country Report No. 2020/136
- DOI: https://doi.org/10.5089/9781513542263.002
- Stock No: 1CPVEA2020002
- ISBN: 9781513542263
- ISSN: 1934-7685
International Monetary Fund. Cabo Verde: Request for Disbursement Under the Rapid Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for Cabo Verde, April 23, 2020.
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