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Sao Tome & Principe
Sao Tome and Principe, an archipelago with two main islands formed from extinct volcanoes and whose names together gave the country its own name, is set in the Gulf of Guinea on the Equator – at 1 degree North – and to the West of Gabon.
With an area of 1,001 kilometers squared Sao Tome is the smallest country in Africa and has a tropical, hot and humid climate with a rainy season from October to May, and a population of just over 187,000 inhabitants.
Sao Tome and Principe was discovered by the Portuguese in the 15th Century and by the 19th century its economy was based on two agricultural products, cocoa and coffee, produced using slave labor.
Although the country gained its independence from Portugal in 1975 the first democratic reforms were only instated at the end of the 1980s and the first free elections were held in 1991. Despite this the political life of the country has been marked by instability and frequent changes of leadership and attempted coups in 1995 and 2003.
The recent discovery of oil in the Gulf of Guinea should have a very significant impact on the economic and social structure of the diminutive archipelago.
More than half of its population lives below the poverty line but the average life expectancy is 67 years and infant mortality is just 6.7 deaths per 1,000 births.
Since independence the country has continued to be dependent on cocoa for its survival, bad management and drought have led to a drop in production. Prices on the international market have increased however and producers’ revenues have remained practically unaltered.
Sao Tome may see much benefit from exploration of oil reserves in the Gulf of Guinea as the country imports practically everything it needs. The first oil contract was attributed to a US company, as have tourist resources.
Area: Total area 1,001 sq km.
Population: 199,579 (est. 2007)
Capital City: Sao Tome
Languages: Portuguese, and Creole dialects, of which Lungwa Santome, is the main lingua franca; others are Angolar and Lungwiye (on Principe).
Religion: Christianity
Currency: 1 Dobra = 100 Centimos
Major political parties: Movimento de Libertacao de Sao Tome e Principe(MLSTP) in alliance with Partido Social Democratico(PSD) – 23 seats; Movimento Democratico Forca da Mudanca (MDFM) in alliance with Partido Convergencia Democratico (PCD) – 20 seats; Accao Democratica Independente (ADI) – 11 seats; Novo Rumo (NR) – 1 seat.
Head of State: President Fradique de Menezes (elected July 2006)
Prime Minister: Mr Tome Vera Cruz (appointed April 2006) Foreign Affairs Minister : Carlos Gustavo dos Anjos (appointed April 2006).
Membership of international organisations: UN, African Union, Community of Portuguese speaking countries (CPLP) and African Countries with Portuguese as the Official Language (PALOP), the Economic Community of Central African States (ECCAS) and the overlapping Economic and Monetary Community of Central Africa (CEMAC).
Geography
The islands state of Sao Tome and Principe is the smallest country in Africa after the Seychelles. It is located in the Gulf of Guinea just north of the Equator and 300 kms west of Gabon. It comprises two islands – Sao Tome (859 sq kms) and Principe (142 sq kms) and some uninhabited rocky islets. The mountainous islands are of volcanic origin, and the rugged terrain renders large parts of the islands inaccessible. The climate is tropical with 5100 mm of rainfall on the southwest slopes falling to 1020 mm per annum on the northern lowlands.
History
Sao Tome was part of Portugal’s African possessions for 500 years. It was developed as a plantation economy, initially for sugar and later for cocoa, taking advantage of the fertile volcanic soils. By 1908, Sao Tome had become the largest producer of cocoa in the world. Uninhabited when the first Portuguese settlers came, Portugal introduced slave labour from Angola and neighbouring countries, and after the abolition of slavery in 1876, Portugal used forced contract labour from its other African colonies to work on the plantations. The makeup of the country’s population reflects that history: many are mixed-blood or mestico, while others are direct descendants of African slaves.
The population had agitated for independence from Portugal from 1960, mainly through the activities of the Movement for the Liberation of Sao Tome and Principe (originally known as CLSTP in 1960, becoming MLSTP in 1972). But, it was not until a military coup in Portugal in 1974 that the principle of independence was conceded. A transitional government was set up, elections were held for a 16-member constituent assembly (for which all seats were won by the MLSTP) leading to independence on 12 July 1975.
The constitution subsequently adopted in November 1975 vested absolute authority in the President and the Polit Bureau of the MSLTP. Radical socialist policies were introduced, all land and property was nationalised, and the economy was run on central planning doctrine. These hardline policies soon produced splits in the Party forcing a number of moderate politicians into exile. Two alleged coup attempts in 1978 and 1980, involving exiles, further underlined the ideological and personal divisions within the ruling party. In the late 1980s, the MLSTP changed direction, initiating a series of economic reforms together with liberalisation within the Party itself. This paved the way for the return of the exiles. But there were further coup attempts in 1995 and July 2003, the latter over disagreements concerning the government’s handling of oil exploration licensing.
Politics
The one-party system which had prevailed since independence was abandoned in 1990 when a new constitution (amended later in 2003) providing for multipartyism was adopted following a referendum. The new constitution also introduced a limit of two terms of 5 years on the tenure of the President. It provided for a 55-member National Assembly together with regional assemblies. The vanguard role of the old single party, the MLSTP, was dropped accordingly. The first multi-party elections under the new constitution took place in January 1991 and were won by the newly formed opposition party, while the Presidency was won by a moderate politician newly returned from exile. In 1994, the National Assembly granted political and administrative autonomy to the island of Principe. It has a Regional Assembly which is accountable to Sao Tome.
Politics is dominated by a small number of leading families. Executive power is constitutionally divided between President and Prime Minister. This has proved to be an unstable balance. Since 2001, there have been at least eight changes of government. The Army has also played a destabilising role from time to time, most recently in July 2003 when President Obasanjo of Nigeria played a key role in restoring calm.
The current President, Fradique de Menezes, (MDFM/PCD coalition), was elected in July 2001, but the March 2002 parliamentary elections produced no clear majority for any of the parties. The result was a series of co-habitation governments. However, the March 2006 legislative elections saw the end of co-habitation government as the President’s MDFM/PCD alliance won 23 seats in Parliament, while the opposition alliance led by MLSTP/PSD won 20 seats. This allowed the President to appoint a Prime Minister from his own party coalition for the first time since 2001. The next Presidential election is due to take place in July 2011.
Human Rights
The country has a generally good human rights record and there is an independent press. Concerns exist about the harshness of prison conditions, police corruption and the occasional manipulation of the judiciary. The government responds to complaints by human rights groups. Working conditions on many of the cocoa plantations – the main wage employment sector - remain harsh, although land reform has given peasant farmers plots for subsistence.
Economy
GDP: US\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\$ 71.38 million (est. 2005)
GDP per capita: US\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\$ 504 (est. 2006)
Annual growth: 4.4% (est. 2005)
Inflation: 15% (est. 2006)
Major industries: Cocoa, but oil and gas to take off before 2010. Tourism a new field for investment.
The economy of this micro-state is still dominated by the export of cocoa which represents 95% of exports by value. The plantations, nationalised at independence, have since been re-privatised as part of economic reforms introduced in the late 1980s. But the economy is set to change dramatically as it enters the ranks of oil producers. Several blocs were awarded in April 2004 and May 2005 after prolonged licensing rounds. The country received its first signature bonus in July 2005 from the licensing of Block 1. Chevron, the operator of Block 1, announced in March that an oil discovery it had made in 2006 would not be commerically exploitable. Oil production is not likely to begin until 2010. Once it does, growth rates are expected to increase driven by oil-related investments. In order to cope with the huge impact of oil receipts, the government adopted an Oil Revenue Management Law in late 2004 to ensure that oil revenue is managed transparently and efficiently. The Law also provides for a government Trust Fund.
The oil fields are to be developed jointly with Nigeria in a Joint Development Zone (JDZ) and managed by a Joint Development Authority (JDA) under an agreement between the two countries signed in 2001 that settled a long-standing maritime boundary dispute. Under the agreement, Nigeria will take 60% of the profits and Sao Tome 40%. Oil licensing has been controversial. Certain companies (Exxon Mobil and ERHC) were given preferential rights several years ago. The government has since renegotiated more favourable terms to other companies but alleged irregularities in the adjudication process for awarding the licences delayed the final award of the blocks.
Apart from managing future oil revenues, Sao Tome’s economic policy is tied to its National Poverty Reduction Strategy 2003-2010. This will require external funding of some \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\$30.5 million per annum.
The Paris Club forgave Sao Tome and Principe \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\$24.5 million of debt in May 2007. This was additional to previous substantial debt write-offs by the World Bank and African Development Fund. The country’s ratio of debt to exports of goods and services remains high at 337% in 2007 but is vastly improved from a figure of 1,655% in 2002-4. The Government is hopeful that its remaining debt commitments of around \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\$80 million – owed to bilateral creditors – will also be forgiven.
Development
Sao Tome has been highly dependent on donor assistance since independence. Up to now, some 70% of its tiny budget is externally supported. The country is the recipient of one of the highest per capita amounts of development assistance in the world. The IMF and others have used this leverage to encourage economic reform. There is now concern among some that the coming oil wealth will weaken the government’s pursuit of good economic governance. With a small population of around 200,000 its socio-economic indicators are much better than most African countries. It records life expectancy of 69.7 years and an 83% adult literacy rate. On the UNDP Human Development Index for 2006, Sao Tome and Principe ranked 127 out of 177 countries placing it near the top of all sub-Saharan African countries. However, an estimated 54% of the population live below the poverty line.
International relations
Sao Tome and Principe’s initial post-independence relationships were forged with the Soviet Bloc and Cuba. But since the mid -1980s the country has sought to widen partnerships particularly with Western donor countries and institutions as part of its economic reform programme. Its closest friendships are with the other Portuguese-speaking African countries and with Portugal itself, the main trading partner. For long Angola was a vital partner having maintained a battalion of soldiers to guard the Presidency following an alleged coup in 1978. But recently, its relationship with Nigeria has grown significantly as a result of their mutual oil interests. President Obasanjo personally stepped in to prevent a military coup in mid- 2003. Significantly, Sao Tome recognised Taiwan in 1997 despite opposition from the Government and Parliament. Relations with China are poor as a result.
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