Cabo Verde agrees with Portugal to convert debt into “climate capital” – PM – Economy
“Climate financing: it is assumed, it is, it is poorly established for this to happen so that it is established, that it can be done in fact, it is important for the realization of the realization”, said the Prime Minister of Cape Verde, who is recognized as his Prime Minister of Cape Verde Correia. e Silva, at the closing, in Praia, of the meeting of Portuguese-speaking parliamentarians belonging to the Inter-Parliamentary Union (UIP).
The UIP, created in 1889 to promote the cooperation of parliamentarians from sovereign states, is the oldest multilateral organization, currently by deputy Duarte Pacheco, and the group of deputies from the Community of Portuguese-Speaking Countries (CPLP) in the National Assembly, in Cape Town. -verdiana, for debater such as “Climate Change Faced with the Challenges of Sustainable Development” in the last two days.
With the Cape Verde archipelago experiencing a severe drought for about four years, still recovering from the economic consequences of the covid-19 pandemic and energy impact now the escalation of prices, namely, in the face of the war in Ukraine, Ulisseia e Silva explains that “the transformation of climate capital and debt natural capital” is an “interesting idea” that Cape Verde is working on.
“That means if we have energy targets, up to 50% of renewable energy penetration [atualmente cerca de 20%] this will presuppose an investment of 400 million euros. So that part can design the power transformation that can make that purpose, that goal can be designed to achieve the goal.
“The same thing regarding objectives and targets that may have objectives in terms of water reduction, the problematic issue then is climate capital, natural capital. And this debt replacement can have this effect that will make us a much more resilient, because we reduce exposure to external shocks”, he added.
According to Cape Verde’s prime minister, the process to transform part of the external debt into investment measures to mitigate the consequences of climate change is more advanced with Portugal, one of the country’s creditors and creditors.
“We are already in negotiations with the Portuguese Government on this matter at a very advanced stage, with a well-designed strategy with supporting documents to support the can be a good instrument to convince other partners, other technicians and also to demonstrate that we can, in fact, will make this need for climate financing instruments and, from there, be able to expand to other modalities”, said Ulisses Correia e Silva.
The Cape Verdean public stock increased to the equivalent of 149% of the estimated Gross Domestic Product (GDP) for 2022 through April, according to the most recent provisional execution report.
According to a document from the Ministry of Finance, the ‘stock’ of Cape Verde’s public debt reached the period of 289,872.8 million escudos (2,658 million euros), a new maximum value, when last March it was an absolute 284,282 million escudos (2,571 million euros).
In year-on-year terms, the Cape Verdean public debt ‘stock’ increased by 9.6% to 264,528 million escudos (2,425 million euros) last year, then equivalent to 146.6% of GDP in 2021.
In the past, the public debt contracted internally is worth the equivalent of 45.4% of Cape Verdean GDP (44.1% in April 2021), increasing to almost 88.368 million escudos (810.5 million euros), while the external debt grew to 103.6% (102.4% in 2021), almost 201,505 million escudos (1,848 million euros).
With an economic obligation of 14.8% in 2020, which in view of Cape Verde’s GDP operation is necessary9, the public debt ‘stock’ ratio also as a function of GDP soared. This ratio exceeded 100% of GDP for the first time in 2013, but was falling in the previous legislature (2016-2021), until the beginning of the covid-19 pandemic, mainly due to the archipelago’s economic growth, of more than 5% per year, had already grown in absolute terms.
The main economic consequence of the covid-19 pandemic in Cape Verde is related to a sharp drop in tourist demand since 2020, a sector that before 25% of the country’s GDP in March, with a sharp drop in tax revenues and a guarantee of consumption. .
PVJ // JH
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