“Robust economic recovery and rigorous fiscal management underpin the international agency's decision, signaling greater investor confidence in the archipelago.”
On February 6, 2026, the credit rating agency Standard & Poor's (S&P) announced an upgrade of Cape Verde's sovereign credit rating, raising its long-term rating from B to B+. In addition to the upgrade, the agency assigned a positive outlook, suggesting the possibility of further upgrades in the near future if the country's growth trajectory and fiscal discipline continue.
Engines of growth: tourism and remittances
S&P's rationale is based on the vibrant performance of the tourism sector, which remains the main pillar of the national economy, and the steady flow of remittances from the vast Cape Verdean diaspora. These two factors have been crucial in strengthening foreign reserves and boosting gross domestic product (GDP). The agency expects the country to record primary surpluses over the next three years, facilitating the continued reduction of public debt.
Debt sustainability and monetary stability
One of the highlights of S&P's analysis is the nature of Cape Verde's public debt. Being mostly composed of concessional loans (long-term and low interest rates), debt servicing becomes more manageable. Interest costs are estimated to represent around 6.6% of revenues between 2026 and 2029, significantly lower than the average for many African countries. In addition, the Escudo's peg to the euro continues to be seen as a guarantee of low inflation and macroeconomic stability.
Structural challenges and political landscape
Despite its optimism, S&P does not ignore the challenges. The fragmentation of the domestic market due to insularity, the high costs of connectivity between islands, and vulnerability to external shocks remain obstacles. On the political front, the agency refers to the 2026 legislative and presidential elections, anticipating a close contest, but stresses that Cape Verde's solid institutional framework ensures stable transitions and continuity in fundamental economic policies.
Who is Standard & Poor’s (S&P)?
S&P Global Ratings is one of the world's "Big Three" credit rating agencies, alongside Moody's and Fitch. Its role is to assess the ability and willingness of a country or company to honor its financial obligations in full and on time. A higher rating, such as the one now assigned to Cape Verde, reduces the risk perceived by international investors and can lower financing costs for the country.
Context of Evolution
It is important to remember that this is the second upgrade in a short period of time. In August 2024, S&P had already raised Cape Verde's rating from B- to B. This new upgrade to B+ in February 2026 consolidates Cape Verde's image as a safe destination for investment and an economy on a path to post-pandemic recovery.
Caboverde24.info
Source: S&P Global Ratings /
