WASHINGTON, May 1, 2014 - The World Bank’s Board of Executive Directors approved on April 22 a US$15.5 million credit to support the Government of Cabo Verde’s effort to strengthen the country’s macroeconomic resilience to external shocks. The Poverty Reduction Support Credit (PRSC-8) will promote structural reforms that improve competitiveness and productivity to ensure poverty reduction and to boost shared prosperity.
The PRSC 8 is the first in a series of three one-year operations to support the implementation of the Government’s Third Growth and Poverty Reduction Strategy (GPRSP 3). According to Vera Songwe, Country Director for Cabo Verde, “this operation reflects the World Bank’s support for Cabo Verde to adapt the country’s development model to its new economic and financial circumstances; to restore economic growth through structural reforms designed to raise productivity;, and improve the private investment climate”.
“The credit will assist the government in increasing domestic resources, improving the public-investment system to ensure high-quality ventures; and implementing a set of priority reforms focused on the performance of state-owned enterprises (SOEs)”, indicated Fernando Blanco, World Bank lead economist for the Africa Region and Team task leader.
“It will also support reforms to establish a more transparent, fair and flexible investment climate by reducing administrative barriers to trade, rationalizing the tax-incentive system, improving the management of infrastructure assets and conserving Cabo Verde’s natural assets which are vital to maintaining the competitiveness and sustainable tourism industry”, added Mr. Blanco.
On May 2012, the World Bank approved a US$12 million Poverty reduction support credit (PRSC 7) to support the transition between the Second and Third Growth and Poverty Reduction Strategies (GPRSP 2 and 3).