The World Bank has officially reclassified Cape Verde as an upper-middle-income country, marking a significant milestone in the archipelago’s economic development journey. The change, which took effect on July 1, 2025, was based on updated data showing a substantial rise in gross national income (GNI) per capita.
According to a statement released by the World Bank on Monday, Cape Verde’s GNI per capita surged by 16.8% between 2023 and 2024, a performance that lifted it out of the lower-middle-income bracket. The main driver behind this impressive jump was a strong real GDP growth rate of 7.3% in 2024, spurred largely by a resurgence in the tourism sector, which remains central to the country’s economy.
The upgrade also reflects improved macroeconomic stability, characterized by lower domestic inflation, and a revised national population estimate, which fell by 12.8% based on updated United Nations data. The population adjustment directly influenced per capita income levels, further supporting the country’s move up the income classification ladder.
What the Reclassification Means
Cape Verde’s new upper-middle-income status places it in a group of countries with GNI per capita between $4,516 and $13,845, according to the World Bank’s annual income classification thresholds. This shift is not only symbolic but could also impact the country’s access to certain forms of development assistance and concessional financing.
While this change signifies progress, economists caution that the country must now consolidate its gains through continued investment in infrastructure, human capital, and economic diversification, especially as the tourism sector remains vulnerable to global shocks such as pandemics and geopolitical instability.
Broader Implications for Development
The World Bank emphasized that the reclassification should be seen as both an achievement and a call to action. Countries that move into higher income brackets often face challenges in maintaining growth momentum and ensuring that development gains are equally distributed across regions and demographics.
Cape Verde’s government has signaled its commitment to inclusive growth, with efforts underway to expand digital connectivity, strengthen public financial management, and promote green energy solutions in line with global sustainability goals.
The country joins a growing list of African nations that are making headway in improving their income status, offering a model of resilience and recovery in the post-COVID economic landscape.
