The Government of Cabo Verde is to request a three-month technical extension from the International Monetary Fund (IMF), running to March 2027, to complete the reviews of two financial support programmes, citing delays in document delivery and the implementation of reforms.

"We are going to request a three-month extension, from January through to March," announced the Secretary of State for Finance, Maria José Lopes, at a joint press conference with IMF mission chief Martin Schindler, who concluded a visit to the country on Friday (6).

Lopes justified the request by pointing to the complexity of the programmes and the number of ministries and institutions involved. "We are dealing with two complex programmes and four reforms involving three or four ministries and several institutions. That alone justifies requesting an extension," she said.

Among the obstacles to completing the reviews are the accounts of state-owned carrier Transportes Aéreos de Cabo Verde (TACV) for 2023, 2024, and 2025, which have yet to be approved or audited. Under the Resilience and Sustainability Facility (RSF), reforms in the water and energy sectors also remain unfinished.

Lopes expressed confidence that "by March the conditions will be in place" for the reviews to be concluded. Schindler, for his part, acknowledged there had been "many issues and a great deal of data to process", advocating for a thorough analysis, and added: "We have made progress and will continue" the joint technical work.

The IMF mission chief said the Cape Verdean economy "continues to show resilience, despite a challenging external environment", highlighting robust growth, controlled inflation, a solid external position, and international reserves at historically high levels.

Schindler welcomed the 2027 fiscal target, which projects a primary surplus of 0.9% of gross domestic product (GDP), but cautioned that "ambitious revenue projections, rising current expenditure, and new subsidies could limit the fiscal space needed to respond to future shocks".

The IMF mission conducted the eighth and ninth reviews of the Extended Credit Facility (ECF), approved in 2022 and valued at €60 million, as well as the fourth and fifth reviews of the RSF, approved in 2023 and valued at €29 million. Final disbursements are contingent on the completion of the reviews and approval by the IMF Executive Board.