E-Commerce in Cabo Verde - A Mirage

October 3, 2022

Written by Sofia Silva, Head of Exploration, UNDP Cabo Verde Accelerator Lab 

Recently, the UNDP Cabo Verde Accelerator Lab conducted an experiment in e-commerce with the purpose of testing the environment, the facilities and difficulties, the advantages and disadvantages of this important branch of the economy, and below are the results and conclusions the team reached.

One of the most remarkable industries in Cabo Verde is the Creative one, with emphasis on the Carnival, which is the largest and most creative cultural event in the country, mobilizing thousands of people per year and reaching the peak of tourists on the island of São Vicente. The Carnival of Mindelo, the city, is already an event of international character and a driver of the economy.

In this same industry we have the national handicrafts that demonstrate by their quality, authenticity, and diversity an enormous potential for multiplication. In each of the islands, one can identify traditional articles, produced with techniques that should be preserved at the level of our cultural identity and demonstrate the potential for a wider trade. Examples are basketry work on the island of São Nicolau, volcanic stone on the island of Fogo, and clay on the island of Santiago.

With the pandemic, this class of national artisans became quite fragile, citizens and tourists stopped coming to them, annulling the families' source of income.

The Accelerator Lab chose this class in order to test an important driver of the global economy that is e-commerce. We developed a project that trained 40 artisans nationwide in various areas of handicrafts with the aim of boosting online sales.

Thus, the project called – Marketplace de Artesanato, trained artisans in various aspects of e-commerce: use of social networks (Facebook and Instagram), photography techniques adapted to digital, e-commerce platforms and digital marketing. We bet on an African e-commerce platform - Afrikrea.com – for the practical dimension of creating online stores.

The training was held in Mindelo and in Praia, with the artisans traveling to these two cities according to proximity (or availability of transport).

40 artisans were trained and selected by this project's partner, the CNAD – Centro Nacional de Artesanato e Design (National Center for Crafts and Design), which provided all the logistical support, and UNDP, throughout Accelerator Lab, financially supported the project's costs.

The training and experience were positive in the sense that it allowed the 40 artisans to understand how e-commerce works and allowed each one to upgrade according to the degree of "digitalization" they had. Some opened their first accounts on social networking platforms, some began to understand how to use marketing tools to engage customers, and others actually opened stores on an e-commerce platform.

In the end, all 40 artisans recognized that the training would help them in boosting social media as a means of promotion and sales, and a smaller number saw the Afrikrea platform as potential for international sales.

The choice of the platform was based essentially on the possibility that the money from the sale of the product could reach the artisan, i.e., receive the value, after the product was sent to the buyer, through the national post office company.

Afrikrea offers as an alternative to other platforms such as ETSY, the world leader in selling handicrafts, the possibility of "traditional" international bank transfer. That is, AFRIKREA receives the amount from the buyer via online payment and then transfers the amount to the seller's bank account.

Most sites only operate with money transaction systems that do not work in Cabo Verde such as the well-known PayPal, which works as a digital wallet.

We highlighted the Cabo Verdean post office – Correios de Cabo Verde – , for being up to the task of allowing easily, quickly and at reasonable cost the sending of any package both nationally and internationally.

However, all identified as one of the biggest shortcomings the fact that they do not master foreign languages, which are essential for e-commerce.

As for practical results, Joceline Ferreira realized the advantages of being present on social networks and started to boost them, having one of her videos on Tiktok viralized with a reach of 2.5M views and today she has 28K followers which also increases her sales. Ileize Varela says her photos have come alive and increased her number of followers and consequent sales, not in the craft area, but in her confectionery business. - NatuXok | Instagram

Artisans such as DaGraça, increased their sales nationally through facebook Maria Da Graça Correia | Facebook - and Mizé Varela - Mize Acessórios | Afrikrea - and Jocelina Ferreira - Nharti | Afrikrea - are now selling internationally through Afrikrea.

This experience allowed us to conclude what already seemed to be true during the journey.

Sites like Facebook, eBay, Amazon and others are even blocked, for international sales, in the Cabo Verdean territory. There is no payment system that can allow the money from the sale to reach Cabo Verdeans in a simple and usual way as in the rest of the world.

But then, what is missing for us to also be able to take advantage of international sales platforms, which give us, at low cost, the factor of worldwide exposure?

Payment systems worldwide are increasingly standardized so that all can "communicate" with each other.

Big players like PayPal, Payoneer, Revolut, Pix, mPesa (African platform), which are intermediary digital wallets with banks, work with standard systems that interact with banks.

It is necessary to adapt and promote Cabo Verde with international players so that we can enter the global e-commerce panorama and have our national talents, whether in handicraft or in other areas such as clothing brands (CV Brands, Dope Mates, Kebra Kanela Beach, etc.), be able to monetize business, reaching other markets.

Until these changes/upgrades, e-commerce in Cabo Verde is a mirage.