Washington — The World Bank Board of Executive Director approved today a $10 million Development Policy Operation (DPO) for São Tomé and Príncipe (STP) to support the government's response to the human and economic impact of the COVID-19 pandemic as well as economy-wide and sectoral reforms for a stronger, more resilient recovery.
This DPO directly supports the government's COVID-19 crisis response, helping to mitigate the impact of the COVID-19 crisis on lives and livelihoods and strengthening institutional capacity in human capital, improving girls learning and extending coverage of an ongoing cash-transfer program. The project also supports efforts by the government to mitigate the impact of the COVID-19 crisis on businesses and jobs and lay the institutional foundations for higher and more sustainable economic growth. This includes strengthening the institutional and regulatory environment in the electricity and water sectors and strengthening debt transparency and domestic tax revenues.
"This DPO is a reaffirmation of the World Bank's commitment to support Sao Tome and Principe to overcome the constraints imposed by Covid-19. The operation focuses on key structural reforms that are critical for achieving sustained and inclusive growth, efficient investment in human capital, job creation and poverty reduction," said Jean-Christophe Carret, World Bank Country Director for STP.
The COVID-19 pandemic has severely affected STP's economy, primarily through losses in the tourism industry, but services supplied to the local population are also affected. Despite taking early measures to prevent infections brought in from outside the islands, STP has suffered a significant outbreak, which has had a significant impact in the country. As a result, the STP economy is expected to undergo a deep retrenchment in 2020, with a GDP contraction of 6.5 percent in 2020.
World Bank Group COVID-19 Response
The World Bank Group, one of the largest sources of funding and knowledge for developing countries, is taking broad, fast action to help developing countries strengthen their pandemic response. It is supporting public health interventions, working to ensure the flow of critical supplies and equipment, and helping the private sector continue to operate and sustain jobs.
The World Bank Group is making available up to $160 billion over a 15-month period ending June 2021 to help more than 100 countries protect the poor and vulnerable, support businesses, and bolster economic recovery. This includes $50 billion of new IDA resources through grants and highly concessional loans and $12 billion for developing countries to finance the purchase and distribution of COVID-19 vaccines.
PRESS RELEASE NO: 2021/083/AFR