Republic of Cabo Verde Public Expenditure Review : Revisiting the Efficiency of Public Spending to Reduce Debt and Improve Education and Health Outcomes
This Public Expenditure Review (PER) was prepared by the World Bank at the request of the Ministry of Finance of Cabo Verde. With a debt-to-GDP ratio of 126 percent in 2017, Cabo Verde is the most indebted country in Sub-Saharan Africa. The country...
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| Format: | Report |
| Language: | English |
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World Bank, Washington, DC
2019
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| Online Access: | http://documents.worldbank.org/curated/en/806461552536106467/Cabo-Verde-Revisiting-the-Efficiency-of-Public-Spending-to-Reduce-Debt-and-Improve-Education-and-Health-Outcomes http://hdl.handle.net/10986/31527 |
| Summary: | This Public Expenditure Review (PER) was
prepared by the World Bank at the request of the Ministry of
Finance of Cabo Verde. With a debt-to-GDP ratio of 126
percent in 2017, Cabo Verde is the most indebted country in
Sub-Saharan Africa. The country is also at a high of risk of
external debt distress. As part of fiscal consolidation
efforts to reduce debt, this PER identifies measures to
boost fiscal revenues and improve the efficiency of public
spending with emphasis on health and education. The report
recommends tax policy measures to stem revenue loss from
ineffective tax expenditures while strengthening revenue
administration and tax compliance. There is space to reduce
spending inefficiencies on goods and services, wages and
salaries yielding potential fiscal savings. Investment in
human capital is prioritized in Cabo Verde but there is
scope to improve efficiency and outcomes. In education,
reducing repetition rates and addressing human resources
issues are key to avoiding waste and improving outcomes. In
health, the report recommends measures to improve the
allocation of resources to health units. If implemented,
these measures could result in combined fiscal savings of at
least 2.5 percent of GDP. Finally, continued rationalization
of central government fiscal support to State-Owned
Enterprises (SOEs) is required to support a gradual
reduction of the debt-to-GDP ratio over the medium term. The
report includes five chapters. Chapter one discusses the key
drivers of fiscal balances and public debt in Cabo Verde and
explores different options to put debt on a downward
trajectory. Chapters two and three analyzes in detail the
respective performances of fiscal revenues and spending over
2010 to 2017. Chapters four and five reviews public spending
in the health and education sectors with emphasis on
efficiency. Equity issues as also covered in chapters four
and five. |
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