[{"bbox": [83, 104, 1147, 213], "category": "Text", "text": "The Cabo Verde Central Bank set the 2020 tax revenues at EUR 292 000 000 (19 % GDP). Compared to 2019, tax revenues reduced by EUR 88 660 000(-23%). Additional budget support grants, including EUR 17 250 000 from the EU, and concessional credits partially compensated the fiscal gap in 2020. Foreign exchange reserves are currently close to 7 months of imports."}, {"bbox": [83, 236, 1147, 424], "category": "Text", "text": "Although overall political, fiscal and monetary policies underpin a macro-economic stability oriented strategy, the IMF indicated in its April 2021 country report the seriousness of the current macroeconomic challenges and fiscal framework risks, with an estimated fiscal deficit of EUR 136 000 000 (8.9% GDP). The 2021 national budget amounts to EUR 706 000 000, funded primarily by estimated tax revenues of EUR 366 000 000 or 20.9% GDP, and external credits (EUR 157 000 000). It indicates a deficit of EUR 100 000 000 which may lead even to problems to cover non-discretionary expenses. As the crisis prolongs, a revision of the expected tax revenue level and alternative financing is required."}, {"bbox": [83, 424, 1147, 537], "category": "Text", "text": "The country's economic recovery depends on external factors such as foreseen under the new economic paradigm. The recovery of air transport and tourism, and progress on national vaccination plan. The timing of the return of tourism plays a critical role as this will trigger economic growth and relief the Government from financing mitigation measures through increasing debt."}, {"bbox": [83, 553, 1147, 1032], "category": "Text", "text": "Within the macroeconomic context described above the social emergency is now at the centre of government priorities, placing the fight against impoverishment as one of the three man priorities, in order to achieve the eradication of extreme poverty by 2026 and, the eradication of poverty by 2030. Additional budgetary resources and Technical Assistance are needed to ensure that these goals are met in a context where, currently, the volume of non-debt-generating aid flows directly allocated to poverty reduction programs, represents only 0.2% of GDP. Poverty has as well a strong gender bias with 67% of poor households being headed by women. Poverty coupled with an extremely high rate of adolescent pregnancy (19% in 2018) also weighs heavily on young women, resulting on low secondary school enrolment rates that push young girls into the informal labour market. Using the international poverty line, according to estimates from the National Statistics Institute (INE), in 2020 there were 72 874 extreme poor persons (that is, persons living on less than USD 1.90 a day) in Cabo Verde, equivalent to 13.1% of the population. Extreme poverty is more acute in rural areas, where 24.3% of the population is poor, while in urban areas the figure stands at 8.1%. Using the national poverty line, according to the same source, in 2020 there were 175 844 poor persons (that is, persons living on less than USD 2.77 a day) in Cabo Verde, equivalent to 31.6% of the population. Although there is no available data as of yet, extreme poverty is likely to have risen in 2021.³ A Social Response, Recovery and Development Plan was launched at the early stages of the COVID-19 and is being implemented to fight poverty. However, there is a need to provide fiscal space to ensure the short, medium and longer term technical and financial sustainability of these measures (Notably social protection, with the so called Rendimento Social Inclusivo) in order to achieve the 2026 and 2030 Government goals during the recovery phase."}, {"bbox": [83, 1032, 1147, 1352], "category": "Text", "text": "The high electricity cost affects not only the budget of the poor families (reflected also in the cost of water which is often from desalinised sources), it is as well identified as a key factor hampering the competitiveness of doing business in the country. The dependency on water supplied through fossil fuel generated desalination plants further increases overall costs and underpins the need for a major transformational initiative in support of renewable energy production. As a response to these challenges the country betting on shifting from fossil fuels to renewable energies. One of the most salient issues in Cabo Verde's development policy is its commitment to promote a renewable energy transition with a national target of reaching 50% of all consumption from renewable sources by 2030. Cabo Verde's ambition is realistic and, if successful, it will place it among first countries in Africa, and in the world, to reach this goal. Although the ambitions are high, the country needs to implement reforms to enable investments in this green transition (including through blending and guarantees). Other critical measures to ensure a green growth model pertain to the circular economy and in particular the recycling of waste, notably in the tourism and fishing industries as well as major ports."}, {"bbox": [83, 1368, 1147, 1422], "category": "Section-header", "text": "**Identification of main stakeholders and corresponding institutional and/or organisational issues (mandates, potential roles, and capacities) to be covered by the action:**"}, {"bbox": [83, 1446, 1147, 1580], "category": "Text", "text": "The Government of Cabo Verde is the main stakeholder and beneficiary of this action as a duty-bearer. Despite the relatively small envelope of this action, the transfer of budget support to the treasury will balance the loss of revenues and increased expenditures, and provide additional fiscal space for the COVID-19 social and economic mitigation measures in place and benefit to the most vulnerable businesses and families. Additional vulnerable groups (rights-holders) to benefit from this action are: individuals and families living under extreme poverty and living in vulnerable"}, {"bbox": [72, 1637, 943, 1663], "category": "Footnote", "text": "³ 2021 Voluntary national review on the implementation of the 2030 agenda for sustainable development"}, {"bbox": [1050, 1663, 1158, 1687], "category": "Page-footer", "text": "Page 6 of 28"}]