African Development Fund expands grant to support SMEs in agriculture and tourism
The Board of Directors of the African Development Fund approved on Wednesday in Abidjan a grant of US $ 10.7 million to SÃ£o TomÃ© and PrÃncipe for the implementation of the first phase of the ZuntÃ¡mon Initiative, within the framework of the Lusophone Pact.
The project aims to improve the business environment by removing specific bottlenecks that hinder private sector-led growth. The project will also build capacity and access to markets and credit for small and medium-sized enterprises (SMEs) through technical training and business development. This will ultimately increase their contribution to the economy and job creation and build a more resilient economy.
In addition to SMEs, the project will benefit investors and business support institutions such as the Trade and Investment Promotion Agency, professional associations and business support organizations, financial institutions and the Central Bank of SÃ£o TomÃ©. and Principe. The implementation of the project will lead to reducing the number of days to resolve commercial disputes from 1,185 to 600 days by strengthening the capacity of the arbitration center and the commercial court system, and by strengthening the business environment for increase the number of registered businesses.
âThis project will strengthen the capacities of essential institutions of the government of Sao Tome while improving the business environment for private sector development. It will promote and encourage the formalization of the informal economy to create more and better jobs, especially for women and young people who dominate the informal sector. says Ms. Martha Phiri, Director, Human Capital, Youth and Skills Development (AHHD).
The country has great potential in agriculture, services, including tourism and the blue economy, sectors which represent more than 70% of economic activity.
The ZuntÃ¡mon Initiative will focus its interventions on commodities to which women and youth actively contribute, as well as export products with high growth potential such as cocoa, coconut and horticultural products. The focus on these products and services is in line with the Government of SÃ£o TomÃ© and PrÃncipe’s post-Covid-19 economic recovery strategy, which prioritizes support for businesses affected by the pandemic and recovery in key sectors such as agriculture, fishing, tourism and hospitality.
âAfter supporting the COVID response with a historic budget support operation in 2020, the Bank is now at the forefront of the post-pandemic recovery in SÃ£o TomÃ© and PrÃncipe with an innovative approach that responds to the specific challenges faced by the private sector in small island economies, âsaid Mr. Toigo, National Director of the Bank in SÃ£o TomÃ© and PrÃncipe.
The project aligns with the Bank’s Youth Employment Strategy in Africa and responds to the objectives of the Portuguese-speaking Pact by promoting inclusive and sustainable development of the private sector, while contributing to the 2015 Private Sector Development Strategy- 2024 of the country.
Â© Press release 2021