New governor of Sao Tome Central Bank prioritizes corporate confidence

7 July 2006

Sao Tome, Sao Tome and Principe, 07 July – The new governor of the Central Bank of Sao Tome and Principe, Arlindo Carvalho, who took office this week, will give priority to increasing corporate confidence and obtaining debt pardons for the archipelago’s foreign debt, the governor said.

The governor’s inauguration ceremony saw the country’s prime minister emphasize the need to create conditions for Sao Tome to conclude by the end of the year the World Bank and International Monetary Fund (IMF) program for highly indebted poor countries (HIPC), according to Sao tome daily newspaper, Tela Non.

The government, said Prime Minister Tomé Vera Cruz, “hopes that everything will be carried out in order to contribute to the country’s financial performance inevitably leading to conclusion [of the HIPC program], over the next six months, so that Sao tome can benefit from foreign debt pardons.”

Sao Tome’s current foreign debt is estimated to be US$300 million, making debt servicing on of the main expenditures in the State Budget.

According to recent figures from the World Bank, Sao Tome is the most indebted Portuguese-speaking nation, with foreign debt equivalent to 1,665 percent of its annual exports of goods and services, taking into account an average for between 2002 and 2004.

Also at the inauguration ceremony, the new governor said that it was his aim to “ensure permanent readjustment of the financial system’s management mechanisms,” namely, “the management of the balance of different prices, interest rates, exchange rates and taxation rates.”

Estes indicadores, afirmou, “concorrem para a sustentabilidade e crescimento dos níveis de actividade económica e consequentemente a redistribuição equitativa de novos níveis de rendimento social”.

The new governor, who is a professional economist, said it was also his aim to introduce new payment systems to the Sao Tome financial system.

Carvalho replaces Maria do Carmo Silveira, a former prime minister of the country, who was dismissed last month due to alleged irregularities detected in the construction work of the new Central Bank building, valued at US$8 million.

The role of deputy governor was given to Edite Diogo Afonso Soares, said by Tela Non to be an independent.

The bank’s three new directors are Álvaro Santiago, former minister of education linked to the ADI party (Independent Democratic Action), Elsa Barros Pinto, former minister of justice and member of the board of the MLSTP/PSD (Sao Tome and Principe Liberation Movement – Social Democratic Party) and Luiz Moreira de Sousa, independent. (macauhub)