Democratic Republic of São Tomé and Príncipe: Selected Issues

November 16, 2018

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Democratic Republic of São Tomé and Príncipe: Selected Issues, (USA: International Monetary Fund, 2018) accessed November 24, 2024

Also available in: português

Summary

This Selected Issues paper focuses on the prospects of growth in São Tomé and Príncipe (STP). This case study seeks explanations for STP’s relative under-performance and draws lessons for the future. It compares past economic developments in the islands and recommends policies that could most effectively foster future growth in STP. Country-specific characteristics as well as weak institutions contributed to STP’s relative underperformance since independence. Initial conditions, particularly regarding human capital and natural resources, contributed to STP’s relative underperformance, especially in the first decade after independence. Experience in the four island-states suggests that fiscal discipline, revenue mobilization, and a more active private sector, particularly in the tourism sector, may be key to tap STP’s growth potential. Fiscal discipline is needed to contain the fiscal deficit and bring the debt to a sustainable level. Continuing to strengthen public financial management, including implementing multiannual fiscal framework as recommended by the IMF technical assistance, would help.

Subject: Arrears, Banking, Economic sectors, External debt, Financial institutions, Inflation, Loans, Nonperforming loans, Prices, Tourism

Keywords: Africa, Arrears, Caribbean, CR, Food inflation, Food price inflation, Inflation, Inflation dynamics, ISCR, Loans, Nonperforming loans, Pacific Islands, STP tourism receipts, STP's economy, Sub-Saharan Africa, Tourism

Publication Details

Pages:

53
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2018/322
Stock No:

1STPEA2018002
ISBN:

9781484385005
ISSN:

1934-7685

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