Brazzaville, May 27, 2026 (Lusa) - The African Development Bank (AfDB) on Tuesday anticipated that the economy of Sao Tome and Principe would grow by 2.4% in 2026 and 3.2% in 2027, supported primarily by the recovery of tourism.
The African Economic Outlook report, released in Brazzaville at the AfDB's annual meeting, said growth prospects remained positive for 2026 and 2027, driven by the recovery of tourism, construction, public infrastructure work, and investment in renewable energy to alleviate energy constraints.
The institution said that public spending is expected to remain focused on the poorest, hoping that fiscal consolidation will boost revenue collection.
In the AfDB’s analysis, institutional reforms linked to the 2026–2040 National Development Strategy could gradually improve foreign direct investment flows into Sao Tome and Príncipe.
The bank noted that Gross Domestic Product (GDP) growth has been steady, at 1.1% in 2024 and 2.1% in 2025.
Nevertheless, it warned that the main risks to the economy in 2026 related to global commodity prices, particularly a potential further decline in cocoa prices and an increase in fuel costs driven by ongoing tensions in the Middle East.
These factors, it noted, could further exacerbate pressures on the balance of payments.
Additionally, the AfDB identified the slow pace of energy sector reforms, a reduction in foreign aid flows, rising domestic protectionism, and the impacts of climate change as significant risks to the economy.
The upcoming electoral cycle, with Sao Tome and Príncipe scheduled to hold presidential elections on 19 July, followed by legislative, municipal, and regional elections on 27 September, could accelerate the implementation of high-profile public projects, and shift the policy focus towards short-term priorities, delay structural reforms and increase budgetary deviations, thereby weakening macroeconomic stability and the reform momentum in the medium term, the bank warned.
In the report "Africa Economic Outlook 2026: Mobilising Large-Scale Development Finance for Africa in a Fragmented World", the AfDB wrote that Africa’s economic growth is set to slow to 4.2% in 2026, or even to 4% if the conflict in the Middle East persists.
The report was presented on the first day of the Group’s annual meeting, at which representatives from the 81 member countries, including heads of state, finance ministers, planning ministers and central bank governors, including those from Portuguese-speaking African countries (PALOP), reviewed the progress made over 2025 and the major challenges ahead.
The theme of 2026’s meetings is “Mobilising Large-Scale Financing for Africa’s Development in a Fragmented World” and, until Friday, the capital of the Republic of the Congo, Brazzaville, will become Africa’s financial hub, hosting over 3,000 people.
2026’s meetings are being marked by health measures against the Ebola virus, which have been stepped up in Brazzaville, separated from the Democratic Republic of Congo (DR Congo) by a river, and the format of the meetings has been altered, with the Bank adopting a hybrid format, allowing all delegates to participate fully in the proceedings, regardless of travel and logistical conditions.
MIM/MYAL // ADB.
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