Cape Verde's GDP Grows 6.4% in Q1 2026, Driven by Consumption and Investment
Cape Verde's Gross Domestic Product (GDP) experienced a 6.4% growth in the first quarter of 2026, according to the National Statistics Institute (INE). This expansion was primarily fueled by increases in private consumption and investment. On the production side, key sectors contributing to this growth included fishing and aquaculture, trade and repair, financial and insurance activities, real estate, public administration, and education. Net taxes on products, excluding subsidies, also rose by 6.6%, adding 1.0 percentage point to the total GDP variation.
However, this represents a slight slowdown compared to the 7.3% growth recorded in the fourth quarter of 2025. While the overall GDP grew by 6.4%, the Gross Value Added (GVA) at basic prices also increased by 6.4% in real terms, a 0.9 percentage point decrease from the previous quarter. The agriculture sector continued its negative trend, with GVA declining by 5.9%, though this was a less severe drop than the 24.0% decrease in the prior quarter. The construction sector also saw a negative evolution, shrinking by 3.2% after a 7.2% decline in late 2025.
Manufacturing industries showed robust growth of 7.6%, contributing 0.4 percentage points to GDP, while trade experienced a significant increase of 7.3%, more than doubling its previous quarter's performance. Transportation and storage grew by 4.1%, and accommodation and catering saw a modest 0.3% increase. From the expenditure perspective, private consumption accelerated to 4.5%, and public consumption grew by 10.0%. Investment was the strongest demand component, surging by 15.9%. Exports of goods and services grew by 5.5%, driven by a 9.7% rise in services exports, though goods exports decreased by 5.5%. Imports of goods and services increased by 6.9%, with goods imports rising 5.7% and services imports up 11.4%.
The first quarter of 2026 in Cape Verde demonstrates a dynamic economic landscape characterized by strong domestic demand, particularly from private consumption and investment, which are key drivers of GDP growth. The significant acceleration in investment suggests increased confidence in future economic prospects or the impact of prior policy initiatives. While headline GDP growth remains positive, the observed slowdown from the previous quarter indicates potential moderating factors, such as global economic conditions or domestic supply-side constraints. The contrasting performance between sectors, with agriculture and construction still facing challenges while services and trade show resilience, highlights the ongoing structural shifts within the economy. Future policy focus may need to address the persistent weakness in agriculture and construction to ensure more balanced and sustainable growth across all economic segments, while continuing to leverage the strengths in service-oriented industries.
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