One of the most compelling elements in Mafatu's narrative is his need to have to face down the demons that he believes are external, but are actually internal. In his own mind, Mafatu believes the Sea God as responsible for taking his mother and instilling the fear of the sea within him. Yet, in facing his fear of the sea, Mafatu ends up facing the fears that lie within him. The taunts from the other kids because of his fears, the cruelty of his stepmother, and the complete lack of affect from his father are the elements that Mafatu battles against almost as intensely as the sea. The reality is that when he returns to the village, he has faced down the demons that, while perceived to be outside of him, were actually within him. This is the embodiment of courage because it fights the dualistic internal and external anger in the hopes of alleviating agony and pain.
The book is called "Call It Courage" because courage is what the main character, Mafatu, has to develop.
In the beginning, he is afraid of the ocean, which is a big problem for someone growing up in his society. So finally he gets up the courage to go out in a canoe to the other island.
While he is there, he does all sort of things (like fighting with the shark, the octopus, and the wild boar) that force him to gain confidence and courage. This is especially true when he has to deal with the cannibals.
So it is called that because Mafatu is gaining courage through all his experiences.