r Joaquim Rafael BRANCO; Chancery
(temporary) at 801 Second Avenue, Suite 1504, New York, NY 10017;
telephone (212) 697-4211;
US--the US Ambassador in Gabon is accredited to Sao Tome and Principe
on a nonresident basis and makes periodic visits to the islands

Flag: three horizontal bands of green (top), yellow (double width), and
green with two black five-pointed stars placed side by side in the center of the
yellow band and a red isosceles triangle based on the hoist side; uses the
popular pan-African colors of Ethiopia

- Economy
Overview: The economy has remained dependent on cocoa since the
gained independence nearly 15 years ago. Since then, however, cocoa
production has gradually deteriorated because of drought and
mismanagement, so that by 1987 output had fallen to less than 50% of
its former levels. As a result, a shortage of cocoa for export has
created a serious balance-of-payments problem. Production of less
important crops, such as coffee, copra, and palm kernels, has
also declined. The value of imports generally exceeds that of
exports by a ratio of 4 to 1. The emphasis on cocoa production at
the expense of other food crops has meant that Sao Tome has to import
90% of food needs. It also has to import all fuels and most manufactured
goods. Over the years, Sao Tome has been unable to service its external
debt, which amounts to roughly 80% of export earnings. Considerable
potential exists for development of a tourist industry, and the
government has taken steps to expand facilities in recent years. The
government also implemented a Five-Year Plan covering 1986-90 to
restructure the economy and reschedule external debt service payments in
cooperation with the International Development Association and Western
lenders.

GDP: $37.9 million, per capita $340; real growth rate 1.8% (1986)

Inflation rate (consumer prices): 4.2% (1986)

Unemployment rate: NA%

Budget: revenues $19.2 million; expenditures $25.1 million,
including capital expenditures of $19.9 million (1987)

Exports: $9.1 million (f.o.b., 1988 est.); commodities--cocoa 90%,
copra, coffee, palm oil; partners--FRG, GDR, Netherlands, China

Imports: $17.3 million (c.i.f., 1988 est.); commodities--machinery
and electrical equipment 59%, food products 32%, fuels 9%;
partners--Portugal, GDR, Angola, China

External debt: $95 million (1988)

Industrial production: growth rate 7.1% (1986)

Electricity: 6,000 kW capacity; 12 million kWh produce