WASHINGTON, July 17, 2014 – The World Bank’s Board of Executive Directors today launched a new strategy to help the Democratic Republic of São Tomé and Príncipe (STP), implement the country’s Second Poverty Reduction Strategy Paper, agreeing to provide up to $20 million in IDA* resources over four years to help cut poverty (currently above 60 percent), increase growth, create jobs, and reduce the country’s vulnerability to shocks.
Under the new Country Partnership Strategy (CPS), the Bank Group will focus on two broad themes: (a) supporting macroeconomic stability and national competitiveness, and (b) reducing vulnerability and strengthening human capacity. Embedded in the above development objectives are cross cutting themes such as addressing gender inequities, supporting partnership, and fostering capacity-building.
“I’m delighted with this important milestone in our program in STP,” said Gregor Binkert, Country Director for São Tomé and Príncipe. “STP is one of the smallest economies in Africa. This strategy aims at helping the country address its vulnerability and create jobs, while supporting the government to respond better to effects of climate change and environmental degradation.”
Sao Tome and Principe has great potential for growth in private sector investment and job creation in tourism, fisheries, and agribusiness. Under these strategic goals, the Bank Group’s three institutions—the World Bank’s International Development Association (IDA), the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA)—will work together to help improve public finance and natural resource management, private sector capacity (including in tourism and small and medium enterprises), business climate and trade regulations, jobs, primary education and skills development, and addressing climate change concerns.
IDA resources will be complemented by Trust Funds, as well as IFC and MIGA support. The strategy also seeks to ramp up the Bank Group’s knowledge support to the country, including through targeted analytical and advisory activities, and technical assistance.
“Given the limited size of IDA funding, selectivity and complementarity will be paramount,” said Yisgedulish Amde, lead author of the strategy. “Thus, the World Bank Group (WBG) will engage in areas where it has comparative advantage and can provide support in coordination with other development partners.”
The World Bank has funded about 20 projects for STP to date. These projects, contributed to the country’s efforts to reduce poverty and promote economic development. The total World Bank investments into STP ascend US$100 million so far, most of which from IDA.
* The World Bank’s International Development Association (IDA), established in 1960, helps the world’s poorest countries by providing zero-interest loans and grants for projects and programs that boost economic growth, reduce poverty, and improve poor people’s lives. IDA is one of the largest sources of assistance for the world’s 82 poorest countries, 40 of which are in Africa. Resources from IDA bring positive change for 2.5 billion people living on less than $2 a day. Since 1960, IDA has supported development work in 108 countries. Annual commitments have increased steadily and averaged about $16 billion over the last three years, with about 50 percent of commitments going to Africa.