Sao Tome and Principe: Monetary agreement with Europe or West Africa needed before free trade

14 December 2007

Lisbon, Portugal, 14 Dec – Sao Tome and Principe needs a monetary agreement with West Africa or Europe, which would allow for parity between the dobra and a strong currency, before it joins the Economic Partnership with the European Union, the Sao Tome president said Thursday in Lisbon.

IN an interview with Portuguese news agency Lusa, Fradique de Menezes said that the fixed parity agreement was one of the many pieces of “homework” that the country needed to do before signing the Economic Partnership Agreements (EPA), which under current conditions would be negative for the archipelago.

“If we are anchored to the Euro and have fixed and guaranteed parity for a period of time, that would assure the business of any operator. Through Portugal, through any other partner, we have to find this anchorage and there the market will be supplied and their will be more secure trade,” de Menezes said.

As well as the monetary issue, he said, there is other work to be done by the archipelago before entering an EPA with the EU, which would mean the European market opening itself to Sao Tome’s exports and, in the long term, for Sao Tome’s doors to be open to the EU.

“We are trying to diversify our resources for tourism,” for which Sao Toem is counting on “the strong entry of (Portugal’s) Pestana group,” which has several projects planned involving an investment of some 200 million euros.

Finally, he said, Sao Tome and Principe will have to revise its legislation – particularly commercial and labor laws – so that its can boost the economy and attract foreign investment.

Sao tome’s president said that it was also a priority to resolve transport problems on the archipelago, namely the few scheduled flights to Europe and the high cost of freighting.

Sao tome and Principe was represented at the II Europe/Africa summit by President Fradique de Menezes and by foreign Affairs Minister, Ovídio Pequeno. (macauhub)