WHY INVEST IN CAPE VERDE

Cape Verde

"Tourist arrivals are growing at a rate of 22% a year. It is predicted that Cape Verde will reach 1 million tourists a year by 2015, up from just 83,259 in year 2000"

Cape Verde, once hailed as the ‘New Canary Islands’, has recently received a publicity upgrade and is now being hailed as the ‘New Caribbean’ – quite an accolade for an archipelago that was a virtual unknown until the last decade. The reason for this analogy - the Islands share the same latitude, and therefore the same sun and sand formula, as their island counterparts across the other side of the ‘pond’.

Cape Verde is a compact group of ten islands and eight islets in the Atlantic Ocean some 400 miles west of the African nation of Sénegal. The most developed of the Islands include Santiago, the largest of the archipelago at 50km long by 25km wide, Sal, Boa Vista, Maio, Fogo and Brava. The Portuguese were the first to discover Cape Verde back in 1460 and in true ‘finders keepers’ style integrated the Islands into their Empire. As the centuries went by a mixture of Portuguese, English, French and Africans gave rise to the Cape Verdean people. In 1975, independence was gained from Portugal and a multi-party democratic government established in 1991.

Despite their diminutive size, the Islands offer a range of geography from the lofty peaks of the western islands to the level, sandy islands of Sal and Boa Vista in the east. GEM Estates is impressed by the Islands’ universal appeal and therefore promising year-round rental. Visitors who wish to do just about nothing, lie on the dunes, get a good tan, cool
off in the turquoise seas and enjoy a tasty mix of African, Portuguese and Brazilian cuisine by night, are in heaven on Cape Verde. Those that need constant stimulation can try horse riding, bird-watching, fishing, tennis, golf, walking across the rugged landscapes or diving with the dolphins and loggerhead turtles. The Islands are also becoming a surfer’s paradise, lured by open seas and almost constant breezes, in particular to the resort of Santa Maria on the
island of Sal, which is ranked among the world’s top five windsurfing locations and a favourite training ground for world champion surfers.

WHY INVEST IN CAPE VERDE

CLIMATE *****

Cape Verde benefits from a Caribbeanstyle climate as the Islands share roughly the same latitude, albeit on the other side of the Atlantic. The archipelago enjoys an unbelievable 360 days of sunshine per year and is geographically sited such that virtually no extreme weather conditions such as Tsunami or hurricanes have been reported to pass its way (touch wood). Average daily temperatures hover between 21ºC and 30ºC throughout the year, which is warmer and more reliable than even the Canary Islands. To gain five stars, the sea water is like a bath-tub, sitting at between 22ºC
and 26ºC all year.

ACCESSIBILITY ****

Accessibility to Cape Verde used to be a bit of a drag, generally having to stop in Lisbon to catch a connecting flight and pushing flying time from London up to 7 hours. However, direct flights are now in place from the UK reducing flying time to 5.5 hours, only a touch longer than the ever-popular Canary Islands. There are seven airports across the Islands including the brand new Cape Verde International Airport which officially opened in Praia on the island of Santiago in October 2005. In response to public demand, independent airline Astraeus began weekly direct flights from both London Gatwick and Manchester to the island of Sal in November 2006 and Cape Verdean Airline TACV will fly directly into Santiago from Birmingham in the near future. Four stars because choice is limited, although as a relatively new holiday destination for discerning travellers, GEM Estates expects more direct flights to appear over the coming
years.

ECONOMY ****

Socially, according to the UN Development Programme, Cape Verde has the fourth highest Human Development Index, (where factors such as GDP per capita, life expectancy, adult literacy and so on are taken into consideration), of all African nations. Only the Seychelles, Tunisia and Mauritius can top it. The economy is well managed; Cape Verde has a low debt service ratio and an excellent repayment record. Another string to its stable bow is that the country’s currency, the Cape Verde Escudo, has been linked to the euro since its introduction in late 2001 thus keeping inflation low. The archipelago is currently considering introducing the euro instead of its own escudo and it is already complying with most of the EU’s economic stability demands. In 2006 alone, Cape Verde authorities approved investment projects totalling 300 million US dollars, a large proportion in the booming tourism sector. Four stars as it is still a nation on the way up.

TOURISM *****

In 2004 about only a thousand Brits visited the Cape Verde Islands, but now accessibility has been improved this area is becoming a significant tourist destination. According to the latest official statistics, tourist arrivals continue growing at a rate of 22% per annum and it is projected that Cape Verde will reach one million tourists annually by 2015 (from 83,259 in the year 2000). The number of hotel beds is increasing year-on-year and Spanish chain, Riu, has no less than two five star hotels on the island of Sal. Five stars awarded as Cape Verde appears in travel giant Expedia.co.uk’s Top 10 Destinations for 2007.

PROPERTY MARKET ****

Cape Verde is relatively small in size and adopts a policy for low-density building, meaning that the Islands will never become over-developed. With high demand and small supply, investors can expect to benefit from that most basic of economic principles - demand outstripping supply. In terms of potential for capital appreciation, the property market in Cape Verde is still in its infancy and the resale market hasn’t really kicked in yet, however on some of the larger developments that have been released in stages, prices have increased to the tune of approximately 30%. Prospective
investors need only look 1,000 miles north at prices on the Canary Islands to see the long term potential for Cape Verde and given the all-year-round holiday season appeal, investors can be sure that their property will seldom be left empty. Four stars as the market has only just begun to accelerate, so accurate predictions are tough.