Sao Tome and Principe: Government wants to privatize energy company

21 April 2009

Sao Tome and Prinicipe, 21 April – The government of Sao Tome and Principe intended to privatize the water and electricity company and should shortly launch an international tender, said the minister for Natural Resources, Energy and the Environment Monday in Sao Tome.

In statements to Portuguese news agency Lusa, minister Cristina Dias added that at the last session of the Council of Ministers “a recommendation emerged to look into whether the Water and Electricity Company (Emae) should continue with its current status, providing all production, distribution and commercialization of electricity services.”

The minister specified that the privatization would not be total, and the Government would retain the distribution or commercialization of electricity.

Cristina Dias added that, for the time being, the government was collecting contributions from partners in the development of the archipelago.

A World Bank report referred to the need for the “Government of Sao Tome to move away from managing public companies” and about Emae it said that “energy production costs are onerous and incompatible with an economy with such fragile characteristics.”

At that time a Privatization Office was set up, with World Bank funding, charged with privatizing almost all State-owned companies.

Emae, the National Telecommunications Company (Enatel) and the Fuel and Oil Company (Enco), remained outside this framework, these last two being partially privatized, although the government still held most of the shares.

Successive Sao Tomean governments have always resisted the privatization of Emae, considering it the country’s “most important strategic company”, though the archipelago’s current energy situation shows that the Government is not able to maintain the company.

According to the minister, the island’s development was making increasing demands on the energy sector, given that the energy currently produced by Emae is not sufficient for the ever-growing needs of the companies operating in Sao Tome and Principe. (macauhub)