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São Tomé PM: Social cohesion needs economic growth

NEWS AND ANALYSIS

São Tomé PM: Social cohesion needs economic growth

Patrice Trovoada, the Prime Minister of São Tomé and Príncipe, was born into an era when the archipelago’s thirst for political independence was coming to a head. His father, Miguel Trovoada, was leading the struggle for liberation, and became the independent country’s first head of government.

“I grew up in a political environment, not only immersed in national politics, but also the struggle against Portuguese colonialism, and the emancipation of black people,” he begins.

Despite being born in politics, his decision to follow his father down a similar career path was personal. “I have a younger brother and a sister who chose another path, so mine was a deliberate choice. First I worked in the back office, where I was supporting my father, whom I admired as a politician. When my father left power democratically, I felt that the country still faced challenges.”

Those challenges were essentially economic. But while Trovoada recognised that his father had introduced political pluralism and a certain degree of freedom, he was convinced that São Tomé and Príncipe needed to write a new economic chapter. “Democracy was fundamental,” he observes, “But social cohesion, stability and modernisation can only happen with strong economic growth.”

Following his victory in the October 2014 legislative election under the Independent Democratic Action (ADI), Trovoada is working in a collaborative arrangement with President Manuel Pinto da Costa, an independent politician without political party affiliations. This is Trovoada’s third stint as prime minister.

“It is easier [this time round], because in our semi-presidential system it is much easier to get things done when a party has an absolute majority in parliament,” Patrice Trovoada says. “The President of the Republic has very limited room for manoeuvre and therefore cannot influence matters to such a great extent.”

In any case he feels that this is not the time for political squabbling but one where one needs to answer the demands of those who voted them in: “Our electorate is composed of the lower classes of the country, the young and the poor. As long as we continue getting things done for them, things can only be going well.”

Fiscal improvement

When asked about his macroeconomic stance, as a trained economist, he is forthright. Since 1998, São Tomé and Príncipe has markedly improved its fiscal position and that in turn has led to the resumption of international aid programmes, cancellation of part of its debt, and resulted in a reported 5% growth in 2014. But despite this, the country still has a poverty rate of 50% and the budget is highly dependent on international aid. São Tomé therefore remains a fragile country.

“Over the last decade, the macroeconomic indicators have improved,” Patrice Trovoada says. “Inflation is at 6%; growth is 4.5%; and the primary deficit is around 3%. From this point of view, everything is OK. But what is the main problem? It is that 95% of the budget depends on foreign aid.

“Even with a growth rate of 4.5 to 5%, the economy is unable to create jobs. It is clear that we need a change of logic here. Local production is practically non-existent. In addition to this, public finances have been managed less rigorously in recent years, especially concerning the collection of tax revenues. During the last six months, we, in the government, have had to regain control of spending, to better manage expenditure, to better oversee tax collection. This means that today the wages are paid on time.”

Patrice Trovoada says that, in terms of investment, there is one ambition – to leverage the island’s geostrategic position at the centre of the Gulf of Guinea, and to turn it into a value-chain hub.

“You know, when I am asked about the advantages of São Tomé and Príncipe, I say we have two important assets. The first is the country’s political stability; the second is its geography. We are strategically located in the middle of the Gulf of Guinea and less than two hours from a host of countries representing 300 million consumers, and which in terms of mineral and agricultural resources is also one of the richest regions of the continent.

“In addition, we have an enviable growth rate, and a quickly emerging middle class. All of this predisposes us to be a service hub covering tourism, new technologies and financial services. This is how we hope to support our long-term development.”

But Patrice Trovoada says the country has two infrastructure challenges that need to be urgently addressed. They are the improvements to the deep-water port, and the airport extension.

“We believe that with these two infrastructure developments, we will make a decisive step and turn São Tomé and Príncipe into a hub in the Gulf of Guinea,” the prime minister asserts. He adds: “Other issues, such as agricultural and energy issues, will be managed. 85% of the country will be covered by electricity in the coming two years. Within three years, there will be generalised access to water.

“What we need to do today is to address this problem of creating value and workmanship, is to get away from our external dependency, by developing tourism, which has a great potential here, through the improvement of air links and the deep-water port.

“Despite the proliferation of ports in Africa, the deep-water port remains very competitive because with 16 metres of draft it poses no dredging problems, unlike other ports in the Gulf of Guinea.”

But just what is the potential of São Tomé’s port? Patrice Trovoada is very upbeat on this matter. “Our ambition is to transport at least a million tonnes through São by 2019, when the port will be finished. Given the growth in Africa, which is not proportional to the improvement of the business climate, it will always be useful to have a transshipment port near those countries around the Gulf of Guinea.”

Underexploited industry

He adds that another underdeveloped and underexploited industry is the fisheries sector. “We have a maritime territory which is 200 times greater than our landmass,” he points out.

But the reality is that it is agriculture that is the mainstay of São Tomé and Príncipe’s economy. It is what Patrice Trovoada describes as the “traditional backbone” and is primarily based on two products, cocoa and white pepper.

“We are trying to focus on higher-end products, since our landmass is quite small. We have started marketing cocoa as “Made in São” to some of the largest luxury chocolatiers.

The country’s colonial history means that it remains close to the Portuguese-speaking countries, but new partnerships are being forged, especially with the Lusophone countries of Latin America.

“Among our historical partners, Angola is important, Nigeria is also, to our common economic zone. We also have former political and friendly partnerships with Gabon, Equatorial Guinea and Congo Brazzaville.

“Today we are trying to get closer to other countries such as Cameroon. It is true that beyond the countries of the Gulf of Guinea, who are our natural partners from a service delivery perspective, we need to exchange with others. The north of Brazil is barely five days by boat from São Tomé. If we take sugar
for example, a distribution centre
in São Tome can reduce costs by 30%!”

São Tomé has historically had strong ties with Taiwan. “We are one of the few countries that continues to have relations with Taiwan. But that does not mean we are hostile towards Beijing! We are looking at extending friendship and promoting all areas of co-operation.

“I believe that there is not one strategic global partner, but our partners are everyone. It is important to know what they can offer us and what we can offer them.”

Discussing Patrice Trovoada’s global thinking inevitably brought up the question of the US’s close interest in the oil that is believed to lie in São Tomé and Príncipe’s offshore waters – although, despite many years of exploration, no oil reserves have yet been identified.

“Because of our geography, we are naturally close to the US. Several Western oil companies are operating in our region, and they pay us taxes for this right. Regarding oil, the geological characteristics mean that we have ultra-deep water potential, and it is difficult to extract. But technology is evolving quickly. By 2019, we will have a much clearer picture of what is possible.”

However, a negative development has manifested itself with regard to developing an offshore industry – the rise of maritime piracy in the Gulf of Guinea. This has security implications not only for the maritime industry, operating oil tankers and their precious cargoes, but even offshore platforms that might be prone to attack.

“I have always defended the idea of creating a Gulf of Guinea commission,” Patrice Trovoada says. “At the time of Omar Bongo [the former president of Gabon]; Olusegun Obasanjo [the former president of Nigeria] and [my father] Miguel Trovoada, the idea was that we, the African nations in the Gulf of Guinea, should take charge of the defence and security of our area, as well as responsibility for mining, oil and marine pollution issues.

“The trouble is that we create organisations, but making them work is another matter. I am a firm Pan-Africanist, an advocate of integration. In terms of security, efforts must be pooled in the Gulf of Guinea. At the entrance we have Nigeria, in the South there is Angola, two powers that have military means.

“Next to them are the smaller countries like us. We are positioning ourselves on a particular segment, using technological surveillance and radar, because we have great coverage, and a wide viewing and listening angle from São Tomé and Príncipe. We need to share roles and be complementary to one another to be able to cooperate.

“It is not a question of resources. The oil companies that operate in the region spend a lot on their security, if there was better coordination, we would be able to better secure the area. It is a political question. With the unfortunate experience of Boko Haram, there has been an awakening.”

And yet, despite the Gulf of Guinea’s pressing security issues, São Tomé and Príncipe does have a firmly embedded democratic system and a tradition of tolerance and good governance that places it in very good stead.

Nevertheless, Patrice Trovoada is calling for “a change of generation” within the political class.

“I am 53 years old,” he says, “and I consider myself to be an old person. In northern Europe, there are prime ministers who are 10 years younger than me. It is unacceptable that in countries that are as young as ours, there is no transference to the younger generations.

“We should be concerned about this, because it means that young people either no longer believe that politics can change things, or that there is a separation between politics and the rest of society. In São Tomé and Príncipe, in addition to the economic challenge, there is also the challenge of the renewal of the political class. I feel a responsibility to prepare this generation to take over with the same dreams (and maybe the same disillusionment) I had 20 years ago.”

This is possibly the reason that despite Patrice Trovoada’s party enjoying an absolute majority in parliament, which puts it in a strong position for next year’s presidential election, he is not running as a presidential candidate.

“I was the son of “terrorists”. That’s what the Portuguese called my parents during the colonial era. I was the son of an exile, the son of the political prisoner, and the son of the president. In life, I have experienced a bit of everything, and I do not let myself get impressed by honours and gold. I don’t want to stay in power forever. Where I feel I can give the most is as prime minister, with all of the power that the constitution gives me. But my party will present a candidate. If São Toméans understand the importance of our work [in government], they will elect a president who can provide [the right] oversight to the
government”.
NA

(In conjunction with the AfDB and consulting firm McKinsey, the government of São Tomé will be organising the first investor conference in London in the first week of October.)

Dounia Ben Mohamed 

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