Cape Verde and the risks of tourism specialisation: the tourism option for Africa’s small states

ABSTRACT

Tourism is a viable, but risky, option for many small island countries to integrate and compete in the world economy. This article examines tourism in the small island economy of Cape Verde. It assesses the risks to its long term development posed by the industry. The country has one of the fastest growing tourism industries in the world. However, this rapid growth is a dual-edge sword. Tourism-led growth results in real economic gains. However, the type and organisation of Cape Verde’s tourism industry magnifies the country’s already high structural vulnerability. Given its current structure and pace of growth, tourism increases macroeconomic risks and vulnerability. It is reproducing the same monoculture dependency that traditionally hampered development in African economies. The policy lessons are clear. Cape Verde must foster economic diversification while simultaneously engaging in strategies to mitigate the risks that accompany its biggest and fastest growing sector and export.

KEYWORDS:

• Cape Verde
• Africa
• tourism
• small island developing states (SIDS)
• tourism policy
• economic vulnerability
• tourism specialisation

Disclosure statement

No potential conflict of interest was reported by the author.

Notes on contributor

João Resende-Santos is Associate Professor of International Studies in the Global Studies Department, Bentley University, in Waltham, Massachusetts, USA, and former dean of the School of Business and Governance, University of Cape Verde. He received his PhD from Harvard University, and has taught at the University of Pittsburgh and the University of Pennsylvania. He has served as an advisor in the Ministry of the Economy, Growth and Competitiveness in Cape Verde, and a consultant for the African Development Bank the Cape Verde Ministry of Tourism, Industry and Energy (MTIE). His research and publications focus on international relations, economic development, and the political economy of Cape Verde. The views and ideas expressed in this present article are solely the author’s, and do not in any way represent or reflect the views of the Government of Cape Verde or any other institution.

Notes

1 Unless otherwise noted, tourism statistics cited in this study are drawn from the National Institute of Statistics (INE), primarily its annual and trimester reports, Estatísticas do Turismo.

2 Author’s calculations based on Banco de Cabo Verde (BCV, central bank) figures. Care must be taken when assessing any data on tourism in Cape Verde due to the lack of a robust national accounting system as well as differing methodologies.

3 McElroy and Hamma (2010) classify Cape Verde as a ‘small island tourist economy’, or SITE, but calculate its tourism penetration index (TPI) as least developed, although outdated 2006 data is used.

4 Note that there is a big discrepancy between the arrivals statistics of the World Bank and INE.