Cape Verde - Politics, government, and taxation

The Portuguese colonized Cape Verde in 1456 and populated the islands with slaves brought from West Africa. Cape Verde achieved independence in 1975 after peaceful negotiations with Portugal, which had itself changed government in 1974. The African Party for the Independence of Guinea-Bissau and Cape Verde (PAIGC) was the only political party recognized during the transition. Aristedes Pereira, the first president, was reelected in 1981 and 1986. The same party ruled in both Guinea-Bissau and Cape Verde, and there were plans for the political unification of the countries. However, the Cape Verde arm of the party abandoned unification in 1980 following a coup in Guinea-Bissau. The new African Party for the Independence of Cape Verde (PAICV) was then formed.

Constitutional changes in 1991 allowed Cape Verde to be the first sub-Saharan one-party state to hold multi-party elections. The Movement for Democracy (MPD) was voted in, bringing to office Prime Minister Carlos Alberto Wahnon de Carvalho Veiga and President Antonio Mascarenhas Monteiro. In 1992 the MPD established a new constitution defining Cape Verde as a sovereign, unitary, and democratic republic and included provisions for the protection of democratic rights and freedoms. The president stands as head of state and must be elected by two-thirds of the voters. Legislative power resides in the unicameral parliament, the Assembleia Nacional, which nominates the prime minister. The prime minister is the effective head of government and nominates his ministers. In July 1999, the parliament made further reforms, allowing the president to dissolve parliament and creating a constitutional court. It also established an Economic and Social Advisory Council, and gave Crioulo, a blend of Portuguese and West African speech, official status as a national language.

The 2 major forces in Cape Verde's political scene are the MPD party and PAICV. The MPD was formed in opposition to PAICV's one-party state and has implemented economic and constitutional reform to change Cape Verde to a democracy with a market economy. The MPD has attracted foreign aid to the nation and has built confidence in Cape Verde's economic and political stability both at home and abroad.

The PAICV, under a new leader, Pedro Pires, has retained its leftist orientation, but its ideals are losing favor with the younger members of the party. The PAICV has tended to be popular with emigrants, particularly those who live in the United States. The only party other than the PAICV and the MPD to win seats in the 2001 legislative election was the Democratic Alliance for Change (ADM), which earned 2 seats by garnering 6 percent of the vote.

The MPD won a convincing victory in the 1995 legislative election, and Veiga was returned as prime minister. Monteiro was reelected to the presidency in 1996, when he stood unopposed. The 2001 presidential election was closely fought, with Pedro Pires of the PAICV narrowly defeating Carlos Veiga of the MPD. Pires beat the former prime minister for the presidency by a margin of 12 votes.

Cape Verde has maintained an internationally non-aligned status, while strengthening its ties with both Portugal and Brazil. Cape Verde is a member of the Organization for African Unity (OAU), the Economic Community of West African States (ECOWAS), and the Lomé Convention.

Cape Verde raises about 9 percent of the GDP from income and corporation taxes, 13 percent from import duties , and 7 percent from indirect taxes . Grants from overseas add the equivalent of 18 percent of the GDP. Education receives 19 percent of government expenditure, 21 percent goes to social security, and 19 percent is spent on health care. Cape Verde has a small armed force of 1,100 men, and less than 2 percent of government spending goes to the military.