Overview
Given Cabo Verde’s strategic location, the government aims to transform Cabo Verde into a maritime and logistics hub in the Atlantic. The flagship project toward this goal is the creation of a special exclusive economic maritime zone centered around the island of São Vicente (ZEEEM-SV), home to Porto Grande, the country’s largest port. The authority of the ZEEEM-SV, the entity responsible for the assessment and implementation of projects in the zone, began operating in September 2021. The authority signed its first memorandum of understanding in 2022, notably with a U.S. company. Cabo Verde is increasingly focused on the blue economy, which requires projects to consider their impact on the ocean and coastal areas and prioritize social and economic inclusion of coastal communities. Cabo Verde has nine ports. Fisheries, fish processing, and aquaculture account for 80 percent of the country’s exports and are receiving even more attention as a strategic sector. Despite the impacts of the pandemic, domestic maritime transportation of passengers operated by a private consortium is showing improvements in numbers and efficiency, although reliability needs improvement. Cruise ship visits were on the rise before the pandemic. In 2019, Cabo Verde received 48,500 cruise ship passengers on 147 ships. In the first quarter of 2022, Cabo Verde received 25 port calls from cruise ships and 17,693 passengers. Preparatory work is ongoing for the construction of a cruise ship terminal on the island of São Vicente. The construction will take an estimated 22 months. Once the terminal is completed and with the easing of the COVID-19 crisis, the government expects Cabo Verde to receive 200,000 cruise ship passengers annually.
Leading Sub-Sectors
Ports (improvement of facilities, equipment, and management): Despite good infrastructure, Cabo Verdean ports continue to require repairs, upgrades, and new equipment, including for security. The planned relocation of the commercial deep-water port facility on the island of São Vicente is also an important construction prospect. The African Development Bank is currently funding the rehabilitation of two ports, and the U.S. government, through the Millennium Challenge Corporation (MCC), supported significant improvements to the Port of Praia. The Government of Cabo Verde intends to enter into a licensing contract to manage all nine ports; the process was on hold due to the COVID-19 pandemic but may resume in the last quarter of 2022.
Fisheries: The government hopes to improve and expand this sector. Fish processing and conservation offer opportunities linked to significant export potential. Sport fishing-based tourism represents another relatively untapped opportunity. Aquaculture activities – including shrimp and tuna – have recently started and are demonstrating positive results.
Ship Repair: As part of the special maritime zone, the government plans to privatize the existing ship repair facility (Cabnave). Cabnave, although in need of major investments, continues to receive and repair ships from Europe (mainly Spain) and China. Cabo Verde’s location and its future positioning as a maritime hub are valuable factors to consider for U.S. companies interested in ship-repair opportunities.
Bunkering: The provisioning of fuel to the many ships that pass through Cabo Verde’s Porto Grande is a critical component for transforming the country into a maritime hub in the Atlantic. This need presents an opportunity for U.S. exporters of oil, natural gas, and diesel.
Logistics/Transit Hub to West Africa: This sector is still unexploited but may offer opportunities in the context of a maritime hub. Potential opportunities include warehousing and distribution centers, packaging and assembling, repair services, and other services for the West African market.
Opportunities
The maritime economy is interconnected with other key sectors and offers opportunities in ports, logistics and maritime transportation, renewable energy, tourism (particularly cruise ships), and ship repair. The ZEEEM-SV special economic zone offers many investment opportunities and incentives. The government awards specific fiscal benefits and incentives on a case-by-case basis depending on the relevance of the project to the development of the zone. The ZEEEM-SV’s purpose is to support the transformation of Cabo Verde (particularly the island of São Vicente) into a modern maritime hub. Although the PRC was involved in the feasibility study and spatial planning for the ZEEEM-SV, the project is open to all partners and investors. The zone’s projects continue to be defined but will include port-facilities improvements, deep water ports, bunkering, ship repair, renewable energy, and other activities. The zone’s management authority took office in September 2021.
Resources
- · Ministry of the Sea
- · Ports of Cabo Verde
- · Economic Regulator (ARME)
- · Authority of the ZEEEM-SV