Published on and written by Cyril Jarnias
Setting up a business in Cabo Verde is no longer just a dream of beaches and sun. The archipelago has established itself as a small, stable economy, focused on services, tourism, digital, and the blue economy. But for a foreigner, creating a company there remains a highly regulated journey, with its strengths, pitfalls, and legal specificities.
This guide summarizes the key elements for an entrepreneurial project in Cabo Verde, based on current laws, recent reforms, and practical field experience.
Why consider starting a business in Cabo Verde?
Cabo Verde is an archipelago of ten volcanic islands off the coast of West Africa, which gained independence in 1975. Officially the Republic of Cabo Verde, the country combines several assets rarely found together in the region: political stability, a democratic system, a market economy, a civil law legal framework, and a geostrategic position at the crossroads of maritime and air routes between Europe, the Americas, and Africa.
GDP growth rate in 2022, illustrating the island economy’s dynamic trajectory.
The government promotes a long-term vision: to make the country an “Atlantic blue platform” and a regional digital hub, with strategic documents like the Strategic Plan for Sustainable Development (PEDS II 2022‑2026) and the Digital Economy Strategy (EEDCV 2024‑2030). For an expatriate entrepreneur, this means a relatively predictable political environment and an administration that, while imperfect, has committed to simplification.
The flip side is a very limited local market (less than 600,000 inhabitants), high financing costs, a strong dependence on imports (especially food), structural water issues, and vulnerability to climate shocks. Starting a business by simply “copy-pasting” a European or American model, without adaptation, is a recipe for quick disappointment.
Understanding the legal framework and foreign investor status
The reference framework for private investment is set by Law No. 13/VIII/2012, amended by Decree-Law No. 34/2013. This body of law, often referred to as the “investment law,” is based on key principles that directly concern expatriates.
Cabo Verdean law guarantees equal treatment between foreign and local investors. No local partner is required, except in specific sectors like fishing or certain maritime transport. Foreign capital is not subject to general restrictions. Profits can be freely distributed and repatriated, provided taxes are in order and the investment is registered with the Bank of Cabo Verde.
The second pillar is legal protection. The law protects investors against requisition, nationalization, or expropriation, except for reasons of public interest and with fair compensation. Disputes between the State and investors can be submitted to arbitration, based on national rules or international mechanisms like the ICSID Convention.
To benefit from tax and customs incentives in Cabo Verde, investment projects above a certain amount must be registered with the one-stop shop Cabo Verde TradeInvest. The investor must also be up to date with tax and social security obligations.
In practice, this doesn’t eliminate bureaucracy, but provides a central point of contact to coordinate procedures and file processing, especially for projects of at least 5 million CVE.
Choosing the right legal structure for your business
The legal structure of your company in Cabo Verde will determine your liability, capital requirements, your image with partners, and sometimes your access to tax incentives. Corporate law, codified in the Commercial Companies Code and the Commercial Code, offers several vehicles.
Sociedade por Quotas (Lda), the preferred vehicle for expatriates
The Sociedade por Quotas (Lda) corresponds to a limited liability company. It is the most commonly used form by local SMEs and foreign investors.
It offers limited liability to contributions, accepts a single partner (single-member form), and can be managed by a single manager. The legally possible minimum share capital is symbolic (theoretically €0.01), but in practice, banks, partners, and authorities will view a company with capital of at least 100,000 CVE, or more depending on the activity, more seriously.
From a regulatory standpoint, although the modernized Companies Code allows for very low amounts, some texts still require a minimum of 200,000 CVE. This capital must be paid up to 50% in cash when opening the bank account, with the balance spread over three years. To strengthen the credibility of your project, it’s essential to set a starting capital consistent with its scale and needs.
Sociedade Anónima (SA), for large-scale projects
The Sociedade Anónima (SA) functions as a public limited company or corporation. It is suitable for large projects, companies wanting to attract multiple investors, or large-scale financing.
It requires at least two shareholders (unless the sole shareholder is another company) and a more complex governance structure, often with a board of directors. Historically, the minimum capital was set at 2,500,000 CVE, with 30% paid upon opening and the rest within five years. Again, reforms have lowered the theoretical threshold, but a very low capital remains non-credible for an SA.
Other forms: sole proprietorship, partnerships, and branch
The Empresário em Nome Individual regime corresponds to a sole proprietorship. It is simple to create and close, requires no minimum capital, but exposes the entrepreneur to unlimited liability on personal assets. For an expatriate, this is a choice to be handled with caution, especially if they hold assets in other countries.
Partnerships (like a general partnership or limited partnership) involve unlimited or differentiated liability for partners. These structures are generally not used for foreign investment projects.
It is possible to open a branch of a foreign company, which allows operations without creating a new entity, but with the full liability of the parent company and a more regulated status regarding tax and regulations. This vehicle may suit an already established international company testing the Cabo Verdean market.
Comparative table of main legal forms
| Legal Form | Min. Number of Partners | Typical Capital* | Liability | Main Use Profile |
|---|---|---|---|---|
| Sociedade por Quotas (Lda) | 1 | ≥ 200,000 CVE recommended | Limited to contributions | SMEs, startups, foreign investors |
| Sociedade Anónima (SA) | 2 | ≥ 2,500,000 CVE (historical) | Limited to contributions | Large projects, multi-shareholder structures |
| Empresário em Nome Individual | 1 | No minimum | Unlimited | Micro-activity, local small trade |
| Partnership (general partnership…) | ≥ 2 | Not fixed | Unlimited for some | Close partnerships, specific activities |
| Branch of foreign company | N/A | Decided by parent company | Parent company responsible | Foreign companies testing the market |
Theoretical legal amounts can be symbolic, but “typical” thresholds reflect practice and former requirements.
How does company registration work in practice?
Cabo Verde has implemented reforms to simplify business creation, particularly with the “Empresa no Dia” – company in a day system. In practice, not everything happens in 24 hours, but procedures are clearer than ten years ago.
The commercial registry (Conservatória do Comércio), under the Instituto Nacional de Cabo Verde (INCV), remains the key authority. Alongside, the Casa do Cidadão, present in each municipality, centralizes many administrative procedures.
The typical path for an expatriate creating an Lda or SA involves several steps.
First, obtain a company name certificate to verify that the chosen trade name is available. This service is fee-based, with costs varying from a few hundred CVE to sometimes 10,000 CVE when part of a service package. This certificate is requested from the commercial registry.
Notary fees for drafting and authenticating company statutes in Cabo Verde typically range from 5,000 to 15,000 CVE.
Once the statutes are finalized, partners must open a temporary bank account in the name of the company in formation and deposit the required fraction of capital (30% for an SA, 50% for an Lda, based on current rules). The bank issues a deposit certificate to be presented to the commercial registry.
The next step is commercial registration at the Conservatória do Comércio. This incurs registration fees (approximately 2,500 CVE) and a 0.2% stamp duty on capital if applicable. The “Empresa no Dia” system, where accessible (notably in Praia, Mindelo, Sal, Boa Vista), charges a flat fee around 5,000 CVE, which includes most basic procedures.
The fees for publishing a company’s creation in the official gazette of Cabo Verde are generally between 3,000 and 10,000 CVE, depending on text length.
Next come the post-registration formalities, crucial and sometimes underestimated by expatriates.
The first is obtaining the NIF (tax identification number) for the company, as well as for each partner and manager. For an individual, the NIF assignment is free for the first application, then fee-based (about 600 CVE). For a legal entity, specific fees apply (about 2,779 CVE). The Casa do Cidadão is the usual point of contact for these requests.
Simultaneously, the company must register with the tax authority (Direcção‑Geral dos Impostos / Direção Nacional de Receitas do Estado) to choose its tax regime (normal regime or simplified regime for micro and small enterprises), obtain its VAT (IVA) registration if necessary, and declare the effective start of activity.
In most sectors, a license is required. The competent authority (ministry, municipality, sectoral authority) varies by project (retail, catering, tourism, finance, etc.). Some licenses, like for retail, can be obtained in 48 hours via simplified procedures, while others require longer processes.
Finally, the employer must register the company and its employees with the National Social Security Institute (INPS). The employer’s contribution is about 16% of gross salary, the employee’s share around 8.5%. A flat registration fee of 1,000 CVE is sometimes mentioned for the first registration.
Depending on whether you use the “Empresa no Dia” service, the nature of the activity, and the quality of your file, the entire process can take from one day for the simplest cases to several weeks for complex setups.
Example of approximate setup budget (standard Lda)
| Expense Item | Estimated Amount (CVE) |
|---|---|
| Name reservation/certification | 600 to 10,000 |
| Notary (statutes, deeds) | 5,000 to 15,000 |
| Registration fee at registry | ≈ 2,500 |
| Stamp duty (0.2% of capital) | Variable by capital |
| “Empresa no Dia” service (optional) | ≈ 5,000 |
| Publication in official gazette | 3,000 to 10,000 |
| Bank account opening (fees) | ≈ 2,000 |
| Company NIF | ≈ 2,779 |
| Social Security (registration) | ≈ 1,000 |
| Business license | 2,000 to 25,000 (by sector) |
These amounts remain indicative; reality depends on location, chosen firm, and regulatory changes.
Corporate tax regime: what an expatriate really needs to master
One of the major pitfalls for foreign entrepreneurs is underestimating the complexity of Cabo Verdean taxation, especially the interplay between the normal regime, simplified regimes, and multiple sectoral incentives.
Corporate Income Tax (IRPC) and tax regimes
Corporate Income Tax (IRPC) applies to profits made in Cabo Verde by resident companies and to profits attributable to a permanent establishment for non-resident companies.
The standard rate is around 20% for resident companies. Some sources mention 21% for permanent establishments of non-resident companies, plus, in some municipalities like Praia and Mindelo, a 2% surtax for fire services. The effective rate can thus reach slightly over 21%, or even 25% for cases subject to the old scale.
Two main regimes coexist. The organized regime applies to medium or large enterprises, which maintain accounting in accordance with national standards (SNCRF) and international standards (IASB). Taxable profits are calculated from the accounting result, adjusted according to tax rules.
In Cabo Verde, the Micro and Small Enterprises Regime (REMPE) simplifies taxation. A micro-enterprise is defined by a maximum of 5 employees and annual turnover not exceeding 5 million Cape Verdean escudos (CVE). A small enterprise employs between 6 and 10 people and has an annual turnover between 5 and 10 million CVE. This regime provides for a single tax for these structures.
Under this special regime, the company pays a single 4% tax on turnover, replacing corporate income tax, VAT, the fire surtax, and the employer’s social security contribution. For activities with high margins, this regime can be very advantageous; for a business with low margins and high volumes, it may conversely prove heavier than a profit-based regime.
Tax losses are carry-forward for three years under the general regime, with some incentives allowing longer periods. The country also applies a foreign tax credit system to avoid double taxation on income already taxed abroad.
VAT (IVA), income taxes, and withholding taxes
VAT, or IVA, has a standard rate of 15%. A reduced rate of 6% and various exemptions exist for goods and services considered essential: basic food products, health, education, social activities, certain financial and insurance services. Exports are generally zero-rated.
Companies subject to VAT declare and pay this tax monthly, usually before the 20th of the following month. Micro and small enterprises under the REMPE regime may be exempt, provided they do not conduct import-export operations and their annual turnover remains below 10 million CVE.
For expatriate managers, Personal Income Tax (IRPS) is progressive, with three main brackets: 16.5%, 23.1%, and 27.5%, after an annual tax-free allowance of around 220,000 CVE. Employment income is generally subject to withholding at source.
Dividends paid to shareholders are taxed at 10%. Withholding taxes apply to many types of income paid to non-residents without a permanent establishment in Cabo Verde (royalties, interest, certain services), with rates between 1% and 20%, subject to potential Double Taxation Agreements (Portugal, Spain, Macao).
Simplified overview of main rates
| Tax / Contribution | Rate / indicative scale |
|---|---|
| IRPC (standard rate resident companies) | ≈ 20% |
| IRPC (foreign permanent establishment) | ≈ 21% + possible fire surtax |
| Fire surtax (Praia / Mindelo) | 2% of tax due |
| Single tax REMPE (micro/small enterprises) | 4% of turnover |
| VAT (IVA) standard rate | 15% |
| VAT reduced rate | 6% (targeted goods/services) |
| Personal Income Tax (IRPS) | 16.5% – 23.1% – 27.5% |
| Dividends | 10% |
| Employer social security (INPS) | ≈ 16% of gross salary |
| Employee social security (INPS) | ≈ 8.5% of gross salary |
Smartly leveraging tax incentives and special zones
Cabo Verde is not limited to a standard regime: it has layered several levels of incentives to encourage investment in certain sectors (industry, tourism, renewable energy, R&D, maritime logistics, technology, start‑ups, etc.). For an expatriate, this maze of advantages can be very interesting, provided one can navigate it.
The Code of Fiscal Benefits (Law No. 26/VIII/2013) governs the system. It provides, for eligible investments, tax credits deductible from IRPC, exemptions from customs duties and circulation taxes, reductions in property tax (IUP), reductions in stamp duty on financing, and sometimes reduced IRPC rates for several years.
For instance, an industrial project can benefit from a tax credit of up to 20 to 50% of eligible investment (machinery, equipment, patents), an exemption from IUP for land and buildings used for the activity, and exemption from customs duties on imports of raw materials and equipment.
Tourism projects recognized as being of tourist utility can obtain up to a 30% tax credit, reduced customs duties (5% on certain equipment), and exemptions on IUP and stamp duty related to financing. Renewable energy benefits from tax credits (up to 20 to 30%), a reduced customs duty rate of 5% on components, exemptions from IUP and stamp duty, as well as interest rate support for micro-production.
Companies established in the International Business Centre (IBC/CIN) benefit from a reduced IRPC rate (2.5% to 5%) subject to local job creation, exemptions on dividends and interest for shareholders, and customs and VAT advantages until 2030. The tourism, banking, insurance, real estate, and construction sectors are excluded from this regime.
Summary table of some sectoral incentives
| Sector / regime | Main fiscal and customs benefits |
|---|---|
| Industry | IRPC credit up to 20–50%, IUP exemption, reduced or zero customs duties on equipment |
| Tourism (tourist utility status) | IRPC credit up to 30%, IUP exempt, 5% customs duties on materials, exemption from stamp duty on financing |
| Renewable Energy | IRPC credit up to 20–30%, 5% customs duties, IUP and stamp duty exempt, interest support |
| International Business Centre (IBC) | Reduced IRPC at 2.5–5%, exemption on dividends/interest for shareholders, VAT/customs advantages |
| R&D Projects | Deduction up to 40% of eligible expenses ( + 15% for new companies ), bonus for green R&D |
| Young Start‑ups Program | IRPC at 5% for 5 years (2.5% for IT/R&D), exemption from customs duties on one vehicle and on raw materials |
Alongside these general regimes, the country has multiplied targeted Special Economic Zones (SEZ): a special maritime zone in São Vicente, a special zone for technology (ZEET) in Praia and Mindelo, a special zone on the island of Maio, and planned zones on Fogo/Brava around volcanism. Each zone can offer a package of fiscal and customs advantages negotiated case-by-case, especially for technological, maritime, or ship servicing activities.
For very large projects, the status of Project of Differentiated Merit (PDM) or “stability contracts” with the State can be granted when investment exceeds certain thresholds (e.g., 1.5 billion CVE) and creates a minimum number of skilled jobs. They allow securing a set of fiscal and customs advantages over the long term and may even open, eventually, facilities for obtaining nationality.
Financing your project, managing banking relations, and repatriating profits
One of the main obstacles cited by companies in Cabo Verde remains access to credit. Despite a banking system considered stable and liquid, under tight control of the Bank of Cabo Verde (BCV), lending conditions are strict, required collateral very high, and rates often prohibitive for a small structure.
The banking landscape includes eight commercial banks, with dominant players like Caixa Económica, Banco Comercial do Atlântico (BCA), Banco Caboverdiano de Negócios (BCN), Banco Interatlântico, Ecobank Cabo Verde. Services include accounts in CVE, euros, dollars, or pounds, bank cards (Vinti4, Visa, Mastercard, pan-African cards), online banking – mainly in Portuguese – and operations via SWIFT for international transfers.
For an expatriate, it is possible to open a personal account as a non‑resident. Requirements are: physical presence, a valid passport, a NIF (Tax Identification Number), a local address (sometimes via a simple declaration), and a minimum deposit (often a few thousand escudos or the equivalent in euros/dollars). Once opened, the account can receive international transfers, cash deposits, etc.
For a business, the professional account can only be opened after registration with the commercial registry. Opening the account is intimately linked to the company formation, since the deposit of the initial capital is required upon formation. Banks require a complete file: statutes, registration certificate, official gazette publication, NIF of the company and all partners, copies of ID documents, proof of address, shareholder structure up to the ultimate beneficial owners (UBO), sometimes consolidated financial statements if a shareholder is a company.
Registering the project with the BCV via Cabo Verde TradeInvest is a decisive step, often overlooked. It is essential to guarantee the right to convert profits into foreign currency and transfer them abroad after taxes. Without this registration, the central bank can refuse capital outflows.
Authorization times for an international transfer can take up to 30 days. Beyond that, the BCV must theoretically pay interest at the 30-day Libor rate on blocked amounts. Under exceptional conditions of payment imbalances, the governor can impose spreading transfers over several quarters, but limited to two years.
Given these elements, the recommended strategy for an expatriate entrepreneur is to plan for a high level of self-financing, not to rely on local credit as the backbone of the business model, to structure the investment correctly from the start to secure future profit repatriation, and to size financial flows below thresholds that trigger heavier controls.
Promising sectors and market realities for an expatriate
As Cabo Verde is an outward-oriented service economy, numerous business ideas circulate: tourism and hospitality, restaurants, nautical activities, renewable energy, digital services, import‑export, agro‑processing, healthcare, tele‑medicine, culture, etc.
Tourism remains the central pillar, representing about a quarter of GDP. The islands of Sal and Boa Vista have been transformed into sun-and-beach destinations, with all-inclusive resorts dominated by large groups. This specialization has boosted the economy but limits local value added: many products are imported, and links with the economies of other islands remain weak.
Promising sectors and specific niches for sustainable and differentiating tourism projects.
Development of environmentally friendly projects integrating local populations.
Creation or renovation of guesthouses and lodges with high added value and unique identity.
Design of immersive offers around heritage and quality Moroccan gastronomy.
Organization of stays around outdoor sports and discovery of Moroccan landscapes.
Development of hybrid spaces combining accommodation, work, and community life for digital nomads.
The blue economy (fishing, aquaculture, port services, maritime logistics) is identified as a growth relay. However, the fishing sector is regulated: foreign investors must, in some cases, partner with majority Cape Verdean partners (e.g., 51% of capital in certain fishing activities). Services related to ports, yachting, cruises, and shipyards offer more leeway, especially as port infrastructure expansion and modernization projects are financed with support from the European Investment Bank and the European Union.
Percentage of renewable energy targeted by the government in the electricity mix by 2030.
Finally, digital is at the heart of the national strategy. The archipelago is connected to several submarine cables, is developing technology parks in Praia and Mindelo, has launched a “Cabo Verde Digital” program and the ZEET (Special Economic Zone for Technology). IT services, fintech startups, service platforms, BPO, data and hosting centers find here a relatively advanced environment for the region, even if the availability of highly qualified profiles remains limited.
Given the limited domestic market, expatriates who succeed are often those who design from the start business models oriented towards service exports (to Europe, West Africa, the Cape Verdean diaspora) or who target multiple islands and segments.
Business culture, language, and networks: without them, it’s hard to last
Beyond regulatory aspects, the success of a foreign entrepreneur in Cabo Verde depends on a deep understanding of the human and cultural context. The country claims “morabeza” – warm hospitality – as an identity value, but the business world has its own codes.
Personal relationships are central. Before discussing contracts and numbers, most contacts wish to “know the person,” through informal exchanges, coffees, lunches, or discussions about family and origins. Important decisions are rarely made at the first meeting; one must accept a slower pace, meetings that start late, and decision-making processes marked by hierarchy.
Communication is generally indirect and polite, with a desire to avoid direct confrontation. Too abrupt criticism or a perceived aggressive approach can harm relationships. Expatriates should avoid an arrogant style or constantly comparing with their own habits, at the risk of alienating essential partners.
Language is a powerful filter. Portuguese is the official language of administration, law, education, and most formal business. Cape Verdean Creole (Kriolu) is omnipresent in daily life and even colors Portuguese exchanges. English and French are present in tourist areas and among some professionals but cannot be considered sufficient to run a business. Several sources emphasize that a foreigner without Portuguese has virtually zero chance of being hired or selling effectively to a local clientele.
To succeed in integration, it is almost essential to surround oneself with local collaborators, partners, or consultants who are perfectly fluent in Portuguese and Creole. At the same time, investing in learning the basics of Portuguese, even imperfectly, sends a strong signal of respect and commitment to the local culture, highly appreciated by contacts.
Expatriate and professional networks are another lever. Platforms like Expat.com, informal groups in Praia or Mindelo, events organized by chambers of commerce or structures like Pro‑Empresa or Cabo Verde TradeInvest offer opportunities for meetings, exchange of experiences, and even access to high-level contacts. Several established entrepreneurs state that their success is largely due to these unofficial networks, which allow identifying the right contacts in administration or the private sector.
Residency status, visas, and links to entrepreneurship
Before creating a company, an expatriate must settle their immigration status. There are several types of visas, from a simple tourist visa to a residency visa for professional activity, including the remote work visa (Remote Working Cabo Verde) or residency and citizenship by investment schemes.
For an entrepreneur wishing to settle long-term in Cabo Verde to manage their business, the residency visa for exercising professional activity or for investment is in principle the natural path. It requires a complete file (valid passport, means of subsistence, criminal record, medical certificate, proof of purpose of stay, adequate housing, etc.) and leads to a residence permit.
The country offers a “Green Card” program to obtain a residence permit via real estate investment. The minimum required amount varies depending on whether the investment area is above or below the national average GDP per capita. This scheme is also suitable for entrepreneurs whose professional project (hospitality, tourist residence, service center) includes real estate investment.
More recently, a law (No. 33/X/2023) introduced the possibility of acquiring Cape Verdean nationality by investment, without going through the classical five years of residence. Implementation details are still being finalized, but the logic is a case-by-case review based on the real contribution to development (job creation, investment in strategic sectors, etc.). Thresholds around 200,000 euros of investment are mentioned, though not everything is operational yet.
This visa allows remote workers to stay in Cabo Verde for up to one year without becoming a local tax resident and without taxation on foreign income. However, it prohibits any professional activity for a Cape Verdean employer or generating local income. It is therefore unsuitable for creating a business in the local market but designed to test the country as a base while working for abroad.
An entrepreneur who hires in Cabo Verde must integrate the specifics of labor law. The Labor Code limits working hours to 8 hours per day and 44 hours per week, provides for at least 22 days of paid leave per year, and imposes a minimum daily rest of 12 consecutive hours.
The minimum wage is around 13,000 CVE per month, or about 120 euros, but compensation levels vary by island, sector, qualification, and profile scarcity. In specialized fields (IT, finance, high-end hospitality), attracting good talent can cost more than the minimum suggests.
Social security contributions are shared between employer (about 16% of gross salary paid to INPS) and employee (8.5%). These payments entitle to pension, healthcare, and social benefits. Bilateral agreements with countries like Portugal, the Netherlands, and Spain can avoid double contributions.
Collective dismissal procedures are regulated, with an obligation for written notification to unions or workers, and notice periods. Employees can terminate their contract with notice varying from 15 days to two months. Financial incentives exist for hiring youth or unemployed persons, in the form of tax credits or temporary exemptions from employer contributions.
A foreign entrepreneur will therefore need to balance the relatively low cost of unskilled labor, the scarcity of high-level skills, the burden of social charges, and the need to invest in training to build a strong team.
Commercial real estate, infrastructure, and territorial anchoring
For an expatriate entrepreneur, finding a suitable premises – whether an office, shop, workshop, or tourist accommodation – is a practical aspect not to be underestimated. Available data shows a contrasting supply across islands and cities.
In Praia and Mindelo, monthly rents for commercial premises, offices, or warehouses are indicated in CVE or euros. For example, an 88 m² space in Madeiralzinha rents for about 50,000 CVE/month, while a 135 m² space in downtown Mindelo costs about 45,000 CVE/month. On tourist islands like Sal or Boa Vista, commercial spaces on the waterfront (beach restaurants, shops) are more expensive. Furthermore, investors also offer the sale of hotel suites in existing resorts or land for eco-lodge projects.
Local real estate agencies (Sal4Rent/Aquisal, AMICV, etc.) play a key role in identifying opportunities, negotiating rents, securing leases, and, for those who wish, supporting acquisitions sometimes including a business (e.g., an already operating guesthouse in Santo Antão).
Vanuatu has four international airports on its main islands.
The main handicap remains the high cost of inter-island transport, both for people and goods, with air and sea connections still irregular or expensive depending on the season. A business model dependent on frequent logistical flows between several islands must account for this.
Common expatriate mistakes… and how to avoid them
Feedback from foreign entrepreneurs in Cabo Verde outlines a number of recurrent pitfalls.
The first is underestimating the small market size and building a business plan disconnected from real purchasing power and consumption patterns. A concept that works in a market of millions may prove unsustainable on an island of a few tens of thousands, without sufficient tourist flows or export outlets.
Do not neglect the importance of Portuguese and cultural codes. The idea that a good level of English is sufficient in a tourist country is mistaken. Relations with administration, banks, suppliers, and a large part of clients require, sooner or later, proficiency in Portuguese, at a minimum for the local team.
The third pitfall is viewing Cabo Verde as a tax haven or a base for regulatory circumvention. The country is not a “tax haven”; it applies international standards for combating money laundering and automatic exchange of information (CRS), tightly controls capital transfers, and has ended former preferential statuses (like the special foreign investor status abolished in 2013).
Ignoring the registration of the investment with the Bank of Cabo Verde can later block profit repatriation. Entrepreneurs who omit this step risk being trapped in the local economy without being able to exit without losses, unlike those who follow the procedure and thus preserve their withdrawal capacity.
The fifth and final pitfall is believing that expansion can be financed by local bank credit, as in a wealthy country. Reality rather requires planning for capital contributions or external financing, and using the local banking system mainly for daily management and receiving flows.
In conclusion: a land of opportunities, but requiring preparation and local anchoring
Creating your company in Cabo Verde as an expatriate is neither a simple exotic formality nor an unreasonable gamble. It is a serious project, which can benefit from an interesting combination of political stability, strategic position, targeted tax incentives, and opportunities in growing sectors – sustainable tourism, blue economy, clean energy, digital services.
An investment in Africa requires rigorous legal preparation (choice of legal form, tax regime, registration), patient integration into the local fabric (language, networks, business culture), and realistic consideration of structural constraints (market size, transport costs, scarcity of bank financing).
Entrepreneurs who take the time to inform themselves thoroughly, get support from professionals (lawyers, accountants, specialized consultants), build alliances with reliable Cape Verdean partners, and develop models adapted to the real scale of the archipelago, have the best chances of turning a desire for elsewhere into a sustainable business, at the heart of the Atlantic.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
