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Cabo Verde to submit proposal to resolve Portugal loan

Published on 16/04/2019

Cabo Verde will present a technical proposal to Portugal to solve the repayment of a loan contracted to finance the country’s “Casa para Todos” (House for All) social housing programme, the Portuguese prime minister said last weekend.

“There is a loan whose first maturity is in 2021 and what is agreed between the two governments is that we will work in a way to stagger the payments of this loan according to the financing needs of the Cape Verdean and Portuguese economies,” said António Costa.

The prime minister spoke at a joint press conference with his Cape Verdean counterpart Ulisses Correia e Silva at the end of the work of a two-country summit in Lisbon.

Portuguese news agency Lusa reported that Ulisses Correia e Silva had previously stated he intended to address with the head of the Portuguese government the issue of the staggering or possible pardon of the commercial loan taken on by Cabo Verde from Portugal to finance the social housing programme “Casa para Todos.”

Cabo Verde benefitted from a Portuguese credit line of 200 million euros to finance the “House for All” housing programme and used just 159 million euros, but the Cape Verdean government has repeatedly expressed its interest in seeing the debt pardoned or renegotiated.

The programme, which was launched in 2010, envisaged the construction of 6,010 homes to reduce the country’s housing deficit, but it experienced a number of problems and, in addition to credit line debt, accumulated debt in compensation and default interest to the construction companies.

An audit by the current government pointed to failures in the concession and financial forecasts of the programme, which would eventually lead to the technical bankruptcy of the managing body, Imobiliária, Fundiária e Habitat.