IMF to support São Tomé and Príncipe through three-year aid programme

8 May 2015

The mission of the International Monetary Fund that was in São Tomé and Príncipe in the last two weeks agreed an economic programme with the government of the archipelago with a budget of US$6.24 million, or 60 percent of the country’s quota, according to a statement issued Thursday in Washington.

The announcement, which follows a visit to the archipelago between 24 April and 7 May, to analyse the country’s financial and economic programme, will now be discussed by the board of the IMF, which by July is expected to make a decision to approve this technical proposal based on an three-year extended credit facility.

The head of the IMF mission, Maxwell Opoku-Afari said in a statement “the recent macroeconomic performance of São Tomé and Príncipe has been generally positive” and stressed that despite slack economic growth since slowing to 4 percent in 2012, “There are encouraging signs, including increased foreign direct investment and the stable support of international donors,” which led to GDP growth accelerating to 4.5 percent last year.

The main objective of the IMF programme is to “keep public debt on a sustainable path through fiscal consolidation and at the same time create space for reproductive public spending.”

The goals shared by the government of Prime Minister Patrice Trovoada and the IMF include strengthening tax revenues, streamlining expenditure, public debt management, introduction of a comprehensive plan to eliminate the state’s debt, strengthening financial supervision and banking legislation, improving the business climate and expanding the level of technical services to government institutions. (macauhub/ST)