When what a diaspora saves outweighs what it sends home

Money sent home is the part of a diaspora that gets counted. In Cabo Verde it is the smaller part. A country diagnostic published in 2022 reports that bank deposits held by emigrants amount to about 38 per cent of every deposit in the banking system, and about 37 per cent of gross domestic product. The savings behind that share stood at about 54 billion escudos in 2019, close to three times a full year of inbound remittances.

Key Takeaways

• Migrant deposits have been reported at about 38 per cent of total bank deposits in Cabo Verde, and about 37 per cent of GDP.
• Accumulated emigrant savings were about 54 billion escudos in 2019, close to three times the remittances received in a year.
• Personal remittances were 12.31 per cent of GDP in 2024 on World Bank figures, and have stayed between roughly 9.5 and 15.3 per cent since 2019.
• The diaspora cannot be counted precisely. Descendant-inclusive estimates run from 450,000 to about 700,000; the narrow migrant-stock measure is about 187,000; the resident population was 524,877 in 2024.
• Emigration began with American whaling ships in the late eighteenth century and never stopped.

Why this is not an ordinary remittance story

Because the diaspora does not only send money. It banks at home.

The country diagnostic on Cabo Verde commissioned by the International Fund for Agricultural Development, published in 2022, reports migrant deposits held in bank accounts at about 38 per cent of total deposits in the banking system, equivalent to about 37 per cent of gross domestic product. Total emigrant savings stood at about 54 billion escudos in 2019 on central bank figures, which the same document describes as almost three times the inbound remittances received yearly.

So the accumulated stock is several times the annual flow. A remittance is income that arrives and is largely spent. A deposit is a balance that stays, and it is a liability of the domestic banking system owed to people who live somewhere else. One is a payment. The other is a funding base.

What does a stock do that a flow does not?

It can move for reasons that have nothing to do with the sender's family.

A remittance responds to a wage in Lisbon or Rotterdam and to a need at home. A deposit responds to those things too, but also to what the money could earn elsewhere and to confidence in the institution holding it. The transfer has already been spent by the time anyone measures it. The deposit is still there, still owned abroad, and still able to leave.

An account in Praia operated from Rotterdam also depends on the same three things any cross-border payment does, and what has to exist before a currency can cross a border works through each of them: settlement infrastructure, a clearing arrangement, and permission to convert.

What is in an emigrant account

The diagnostic sets out what the major Cabo Verdean retail banks offer. An emigrant account can be opened remotely and used by more than one holder, on signatures agreed in the contract. It carries online banking, national and international payment cards, and access to products such as housing loans and insurance. Interest earned on the savings accounts is exempt from tax. The government has since removed the preferential interest rates that once sat beside that exemption, but kept the exemption itself.

The accounts are funded in three ways: by wire transfer, by cash deposited during visits home, and through friends and relatives carrying it. Two of those three leave no trace in any payments statistic.

How large is the diaspora, and why does nobody know?

Nobody knows, and the sources say so. The diagnostic states that the true dimension of the Cabo Verdean diaspora is not known. The European Union diaspora mapping adds the same caution, that emigration and diaspora figures for Cabo Verde vary greatly.

The published estimates do not disagree by accident. They disagree because they count different things.

A migrant stock counts people born in one country and living in another on a given date. A diaspora count adds the children and grandchildren who hold the nationality, send money, visit or invest, and after two centuries of continuous emigration that second group is much larger than the first.

So the defensible statement is a conditional one. On the descendant-inclusive estimates the number of Cabo Verdeans abroad is at or above the number at home. On the narrow migrant-stock measures it is closer to a third of it. The two kinds of measure are not competing answers to one question; they are answers to two questions, and the wider one has no settled answer at all.

Where the migrant stock sits is better established. On the United Nations 2020 data the diagnostic puts 67 per cent of it in the European Union: Portugal hosts 68,299 people, or 36 per cent of the total, and France 25,501. The Netherlands, Luxembourg, Italy and Spain together account for a further 32,000, and about 17,500 live elsewhere in Africa.

How did so many Cabo Verdeans come to live abroad?

The islands are dry and the rain has failed often. Drought and famine gave people a reason to leave. Ships gave them a way.

Carling and Akesson, writing in 2009, trace the sequence. American whalers from New England began calling at the archipelago by the end of the eighteenth century, wanting cheap crew and finding it among impoverished islanders, and some of those sailors stayed on when the ships reached Massachusetts and Rhode Island. Between 1900 and 1920 roughly 20,000 people entered the United States from an archipelago whose population was then about 150,000. New immigration legislation closed that route in the 1920s, and it stayed largely closed until the mid-1960s.

Emigration did not stop. It changed direction. Between 1900 and 1970 about 80,000 people left for the Portuguese colonial plantations of Sao Tome and Principe, in conditions the same account describes as close to forced labour. Dakar became an alternative once the American route closed.

The communities that hold the deposits today began forming around 1960. Portuguese construction firms working in the islands brought workers back to Portugal, starting a chain of labour migration that grew quickly into the 1970s. Cabo Verdean men went to Rotterdam as seafarers in a booming shipping industry, and many settled and brought their families. Cabo Verdean women went to Italy as domestic workers, at first through Catholic clergy on Sao Nicolau, then through the sisters, cousins and friends the first arrivals called after them.

Two centuries of that, without a long pause, is why the accounts exist. Why a transfer corridor exists at all works through the general case, which is that a corridor is built by settled migration rather than by trade.

What all of this does to the external accounts

The transfer flow is the visible half, and it is large. World Bank data records personal remittances received by Cabo Verde at 12.31 per cent of GDP in 2024, and the series has stayed between roughly 9.5 and 15.3 per cent every year since 2019. The diagnostic reported 15.6 per cent for 2020 and the European Union mapping 13.5 per cent, so the figure moves with the year and the source but stays in the same territory.

For a small island economy with a narrow export base, an inflow of that size is a standing supply of foreign currency that does not depend on a commodity price or a harvest. Every high-remittance country has that much. What Cabo Verde has in addition is a banking system a large part of whose funding is owned by people living in Portugal, France, the Netherlands and the United States, which ties its external position to labour markets in a handful of European economies and one American one.

None of that is a judgement about whether the arrangement is good or bad. It describes what an economy looks like when a large part of the nation lives somewhere else and keeps its savings at home.

Where to look next

The AUD to CVE page carries the live reference rate for the pair, together with a short block on the exchange arrangement that underpins the escudo. For the general question of how a very large transfer inflow behaves once it is big enough to matter to a whole economy, when money sent home is the economy works through the measurement and what a share of GDP does and does not tell you.

Sources

• International Fund for Agricultural Development and Developing Markets Associates Global, RemitSCOPE Africa: Cabo Verde country diagnostic, PRIME Africa, 2022 - the deposit and savings figures, the emigrant banking package, the migrant stock and its destinations, the 450,000 and 518,180 estimates, and the statement that the true size is not known
• Jorgen Carling and Lisa Akesson, Mobility at the Heart of a Nation: Patterns and Meanings of Cape Verdean Migration, International Migration, 2009 - the whaling ships, the movement to the United States and its closure, Sao Tome and Principe, and the post-1960 migration to Europe
• World Bank Open Data, personal remittances received as a share of GDP, Cabo Verde - 12.31 per cent of GDP in 2024 and the range since 2019
• World Bank Open Data, population total, Cabo Verde - a resident population of 524,877 in 2024
• EU Global Diaspora Facility, Diaspora engagement mapping: Cabo Verde, written by AFFORD, updated December 2023 - 186,372 emigrants or 31 per cent of the population, remittances at 13.5 per cent of GDP, and the caution that the figures vary greatly
• International Organization for Migration, Cabo Verde country page - about 700,000 Cabo Verdeans abroad; the page carries no publication date

General information about migration, remittances and bank deposits in a small island economy. Not financial advice, and not a recommendation of any product or institution. Reviewed by the Tradergy editorial team, September 2026.