First Review Under the Extended Credit Facility and Request for Augmentation of Access, Rephasing of Access, and Financing Assurances Review-Press Release; Staff Report; and Statement by the Executive Director for the Democratic Republic of S�o Tom� and Pr�ncipe
The 2008 Article IV Consultation with the Democratic Republic of São Tomé and Príncipe and sixth review under the three-year arrangement under the Poverty Reduction and Growth Facility discusses policies and exchange rate arrangement. In recent years, public finances have been supported by large oil signature bonuses, but exploratory drilling for oil has not yet confirmed the existence of commercially extractable reserves. Executive Directors supported the authorities’ intention to reconsider São Tomé and Príncipe’s monetary and exchange arrangements.
Second Review under the Extended Credit Facility, Request for Waiver for Nonobservance of Performance Criterion, Request for Modification of Performance Criteria, and Financing Assurances Review-Press Release; Staff Report; and Statement by the Executive Director for the Democratic Republic of S�o Tom�
Context: S�o Tom� and Pr�ncipe's economic development is constrained by its insularity, fragility, limited resources, and low capacity as a small island state. GDP growth has averaged over 4 percent per year since 2012, faster than many small island states. Inflation has also fallen sharply from 28 percent down to about 4 percent, the lowest in the past two decades. These developments notwithstanding, growth has not been sufficiently strong and diversified to meaningfully improve economic prospects and reduce poverty significantly. The poverty rate is high at 66 percent. Focus: Discussions centered on aligning fiscal policy to bring debt to a downward trajectory toward a moderate risk of debt distress; addressing the liquidity overhang to enhance monetary management; improving competitiveness; and safeguarding financial sector stability to support growth. S�o Tom� and Pr�ncipe is participating in the second round pilot of countries to mainstream macro-financial linkages.
Although the impact of the global crisis has been severe, real per capita GDP growth stayed positive in two-thirds of low-income countries (LICs), unlike in previous global downturns, and in contrast to richer countries. Emerging from the Global Crisis explores how LICS have coped with the global economic crisis. It reviews the impact of the crisis on LICs, domestic policy responses to the crisis, and the precrisis conditions of select countries. The prospects and challenges that LICs face are also considered. Sections of the paper look at growth prospects, policy recommendations, the general macroeconomic outlook, as well as the rebuilding of fiscal buffers. The authors also "stress-test" LICs' exposure to further volatility by using a hypothetical "downside" recovery scenario.
Sub-Saharan Africa is contending with an unprecedented health and economic crisis—one that, in just a few months, has jeopardized years of hard-won development gains and upended the lives and livelihoods of millions.