The Government of Cabo Verde submitted this Wednesday, October 1, to the National Assembly, the State Budget (OE) proposal for 2026, which aims to ensure “sustainable economic growth” for the archipelago. The information was released by the Deputy Prime Minister and Minister of Finance, Olavo Correia.
According to the minister, the document will continue to be guided by key pillars considered essential for transforming the Cabo Verdean economy, with emphasis on economic diversification, sustainable growth, and the promotion of social and territorial cohesion.
Olavo Correia further highlighted that one of the priorities is to reduce the weight of public debt relative to the Gross Domestic Product (GDP). “One of the main achievements of this budgetary cycle is the reduction of the public debt ratio to 96.3% of GDP — a historic milestone not seen since 2014,” he stated, stressing that this result stems from fiscal consolidation efforts, the effectiveness of structural reforms, and increased credibility with partners and financial markets.
From a macroeconomic perspective, the 2026 State Budget foresees GDP growth of around 6%, inflation of 1.5%, an unemployment rate of 7.3%, and a budget deficit of 0.8% of GDP.
According to the Ministry of Finance, the total budget is estimated at approximately 816 million euros, with 90% financed by public treasury resources. The Secretary of State for Finance, Alcindo Mota, had already indicated last week that the proposal includes a reduction of the Corporate Income Tax from 21% to 20%. A proposal to lower the Personal Income Tax is also expected to be presented.
Among other fiscal measures, the proposal highlights the elimination of the Special Consumption Tax on new automobiles and the reduction of this tax on used vehicles. It also includes a decrease in import duties on 400 products, as part of the convergence with the special community rate of the Economic Community of West African States (ECOWAS).
With the formal submission of the document to the National Assembly, the 2026 State Budget proposal now awaits scheduling for plenary debate. Parliamentary discussions are set to begin on October 8.
Source: Lusa
