Government of Cape Verde approves TACV loan

Last Friday, December 2, the Government of the Republic of Cape Verde approved yet another State guarantee, this time for a loan of 2.2 million euros, requested by the air carrier TACV, to support the treasury and continue operations and activities planned for this year.

According to the government resolution, the company Transportes Aéreos de Cabo Verde (TACV), also known as Cabo Verde Airlines, resorted to a bank loan from Caixa Económica de Cabo Verde (CECV), in the amount of 250 million Cape Verde Escudos ( 2.2 million euros) “to support its treasury allowing the continuity of operations and activities planned for the current year of 2022”.

“To carry out this financial operation, the said bank requested the State’s endorsement as a guarantee for the loan and an inseparable condition for the completion of the said financing”, reads the resolution published in the Official Gazette, indicating that the term of the operation is four years. .

“The State of Cape Verde, as the majority shareholder and given the relevant role that TACV plays in the dynamics of the national economy, namely in terms of tourism and commerce, recognizes the obvious importance of supporting the company in mobilizing these financial resources, through the granting of this endorsement”, further justified the executive.

The same source also mentioned that in order to meet the financing needs presented in its Recovery and Stabilization Plan, the company has also resorted to other sources to raise funds, such as bank credit.

In February of this year, the Cape Verdean Government had granted another guarantee for a loan of 1.5 million euros to TACV, in view of “emergency needs”, such as the payment of salaries.

In March 2019, the State of Cape Verde sold 51% of TACV for 1.3 million euros to Lofleidir Cabo Verde, a company 70% owned by Loftleidir Icelandic EHF (Icelandair group, which took 36% of Cabo Verde Airlines, company’s trade name) and 30% by Icelandic entrepreneurs with experience in the aviation sector (who took over the remaining 15% of the privatized 51% share).

However, the company was renationalized in July 2021, claiming several breaches in management, having only resumed flights in December last year.

In the Cape Verdean parliament, a Parliamentary Commission of Inquiry (CPI) is taking place on the privatization (2019), renationalization (2021) of TACV and the exit of the company from the domestic market (2017).

The Cape Verdean state will annually inject 1 billion escudos (9.1 million euros) into TACV over the next three years, to guarantee the stability and recovery of the airline, before reprivatizing it in 2024, minister Carlos announced in September. Saints.

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