Cape Verde recognised for economic leadership

Island state was the second African nation to “graduate” from the ranks of the world’s least developed countries.

Cape Verde Pedro Pires meets Nikolas Sarkozy
Former president Pedro Pires recently won the African Leadership prize for good governance [EPA]

When the former president of Cape Verde, Pedro de Verona Rodrigues Pires, was recently awarded the five-million-dollar African Leadership prize, the ex-Portuguese colony that he headed for nearly 10 years was singled out as one of the key African success stories for “good governance”, including multi-party democracy, rule of law and respect for human rights.

The island nation of a little over 510,000 people, located in the central Atlantic Ocean, was also the second country after Botswana to “graduate” from the ranks of least developed countries (LDCs), currently numbering 48 and described as the poorest of the world’s poor.

The graduation in 2007 (compared with Botswana in 1994) was considered a symbol of Cape Verde’s economic achievements. Meanwhile, the overwhelming majority, mostly from Africa, has remained bogged down as LDCs since the 1970s.

“The fact that Cape Verde, with few natural resources, can become a middle-income country is an example not just to the (African) continent but to the world at large,” said Mo Ibrahim, whose foundation administers the annual award, and whose prize money is far more than the $1.5m that goes with the annual Nobel Prize.

The yardstick for LDC graduation includes improvements in per capita income, along with health, education and adult literacy.

Cape Verde has a per capita income of about $3,800 and a 5.4 per cent growth rate of gross domestic product (GDP).

‘Smooth transition’

Ambassador Anwarul Chowdhury, who was UN under-secretary-general and high representative of LDCs, and under whose watch Cape Verde graduated, said: “Since Botswana’s graduation many years ago from the list of LDCs, Cape Verde was the first country to graduate out of the list in an organised way putting to practice the principle of the smooth transition that was championed by me in my capacity as the UN high representative in the face of resistance of LDCs which were identified for the graduation.”

There, the UN system was involved at the country level with its resident coordinator leading the process fully involving the major development partners for Cape Verde, he said.

“Their regular interface with the country’s leadership and regular monitoring of the process by my office at the U.N. headquarters finally ensured that Cape Verde graduated comfortably and confidently towards its smooth transition process,” said Chowdhury.

“Cape Verde has set out before us a replicable process that would facilitate future graduations (of LDCs)”, he said.

The annual Ibrahim Prize for Achievement in African Leadership was held back during the last two years because many African leaders had poor track records: either they refused to leave office after losing elections, manipulated their constitutions to extend their term of office or reneged on pledges not to run for re-election.

But Rodrigues Pires completed his two five-year terms and left office last month, conforming to constitutional law in his country.

“It is wonderful to see an African leader who has served his country from the time of colonial rule through to multi-party democracy, all the time retaining the interests of his people as his guiding principle,” Ibrahim said in a statement released last week.

Besides the five-million-dollar prize over a period of 10 years, the winner also receives 200,000 dollars annually for life.

Past winners include President Joaquim Chissano of Mozambique (2007) and President Festus Mogae of Botswana (2008). The prizes were not awarded in 2009 and 2010.

Meanwhile, Cape Verde is also dependent on a large pool of expatriates living abroad whose numbers may equal or exceed the country’s total population.

Currently, expatriate remittances contribute to more than 20 per cent of the country’s GDP.

According to the Geneva-based International Organisation for Migration (IOM), the Cape Verdean diaspora figures, mostly estimates, range between just under 200,000 to just over 518,000.

The United States and Portugal are among the most popular destination countries.


Despite relatively small figures, Cape Verde ranks among the countries with the highest emigration rates relative to the size of its population.

Although more than three-quarters of all its emigrants are low or medium skilled, Cape Verde does lose a large percentage of its highly skilled workers – nearly 70 per cent go to Western industrial nations, mostly in Europe.

Still, a deeply-rooted tradition of emigration to achieve personal and social success is appearing to be less marked today in Cape Verde, according to IOM’s latest migration profile on this West African nation.

The profile shows that despite major gaps and weaknesses in data collection, there has been a steady decrease in emigration from Cape Verde since the 1970s.

Asked if the decrease in emigration is due to the improvement in the country’s economy, IOM’s Dario Muhamudo, said: “The continuous growth of Cape Verde’s economy in recent years stimulated further investments which allow the national labour market to absorb more labour supply.”

The decrease in emigration is particularly significant if compared to the increasing number of immigrants, resulting in a drastic reduction of the net migration.

Asked if the decline in migrant earnings will impact on the economy, Muhamudo said, “Precise impacts are rather difficult to predict. What we can say is that Cape Verde has been less affected by the global economic crisis as most African countries but the slight reduction in remittances could make households depending on remittances for survival much more vulnerable.”

The share of remittances invested in economic activities is limited, thus, labour market and economic growth should be less affected, he added.

A version of this article was first published by Inter Press Service news agency. 

Source: IPS