São Tomé and Príncipe should be “very careful” not to borrow without “a 35% donation component” to finance projects, the new head of mission of the International Monetary Fund (IMF) for the archipelago said on Wednesday in São Tomé.

Li Xiangming, who led a mission of the Fund that spent two weeks in São Tomé to assess the existing support programme, said it found with “great satisfaction” an economic growth rate of 4.0%.

It is a “fairly good rate, especially when compared with some countries in the region,” said Li Xiangming, cited by Portuguese news agency Lusa.

The IMF mission, which leaves São Tomé and Príncipe on Thursday, said the structural reforms undertaken by the government, namely “a strategy to quickly control the issue of bad loans, the issue of banking regulation and the creation of an audit committee of the central bank,” were “extremely positive.”

Taking stock of the visit, Li Xiangming noted the challenges taken on by the government of the archipelago, particularly in the area of tax, as a result of lower collection due to reduced fuel imports.

“As such there was less revenue and expenditure actually increased a bit but the government has taken measures to ensure that it can have better expenditure control in 2017,” added the head of the IMF mission. (macauhub)