Islands suffer rising poverty, despite strong economic growth

The government of Cape Verde has been embarassed by a new report from National Institute of Statistics (INE), which shows that poverty is increasing in this island state of the coast of West Africa, despite strong economic growth in recent years. INE recently published the results of a national survey of household income and spending conducted between October 2001 and October 2002. This showed that the proportion of Cape Verdeans officially deemed to be living in poverty had increased from 30 percent in 1989 to 36 percent in 2002. It said that poverty, measured in terms of household income, unemployment and nutrition levels and other social indicators, became more widespread, despite an economic boom fuelled by an inflow of aid money and heavy investment in tourism. Between 1996 and 2001 the economy of this arid archipelago of 430,000 people grew by an average of 6.1 percent a year. During that period the International Monetary Fund and World Bank underpinned government reforms with new loans and new hotels were built to cater for sun-seeking European tourists. However, the INE survey made clear that this growth in this former Portuguese colony 450 km west of Senegal had been assymetrical. Although development had benefited the capital Praia on Saotiago island, the port city of Mindelo on Sao Vicente and the island of Sal, where Cape Verde's main international airport is situated, the survey showed that poverty was at its worst in rural areas, particularly on the mountainous islands of Fogo, Brava and Santo Antao and in the interior of Saotiago. The INE report has become something of a political football in Cape Verde. The opposition Movement for Democracy (MpD), which was in power from 1991 to 2001, and the ruling African Party for the Independence of Cape Verde (PAICV) have blamed each other for the rise in poverty. Julio Correia, the Minister of Labour and Social Solidarity, irritated the MpD by pointing out publicly that poverty had gotten worse during the decade that the opposition was in power. An opinion poll commissioned by the government earlier this year showed 42 percent of Cape Verdians thought they had grown poorer since 1991. The MpD in turn blamed the current government for failing to implement properly a poverty reduction programme which it launched in 1994. This provides micro-credits for poor people to start small businesses and organises labour intensive public works projects such as road mending. Economists pointed out that although unemployment has fallen slightly over the past decade to an official rate of 21 percent, many people lack a steady job and only manage to find short-term contracts for a few months at a time. They also noted that the INE survey was conducted during the second year of a severe drought which was broken by this year's plentiful rains, which are likely to give Cape Verde's poor farmers a relatively good harvest.