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São Tomé and Príncipe (STP) has taken positive steps over the last decade to improve its investment climate and to make the country a more attractive destination for foreign direct investment (FDI), including by working to combat corruption and create an open and transparent business environment. Due to STP’s limited revenue sources, foreign donors finance roughly 90 percent of its public investment budget. This reliance on outside investment, however, means STP remains committed to improving its investment climate.

A four-year government agenda approved by the Parliament in November 2022, aims to foster sustainable, inclusive, and export-led economic growth; increase purchasing power of STP’s citizens; improve infrastructure and the functioning of public institutions; and strengthen the country’s resilience to the impacts of climate change.

In early April, the government announced the implementation of a Value Added Tax (VAT) would begin June 1, 2023. With the support of the United Nations Development Programme (UNDP), in 2022, the government established the first business incubator and accelerator center (REINA) to support startups and Small and Medium Enterprises (SMEs). UNDP also helped build an arbitration center scheduled to be inaugurated by the end of April 2023 with the purpose of providing a mechanism to resolve investment disputes without going to court, though the center has yet to open. These efforts, along with others from recent years such as passage of the Anti-Money Laundering and Countering the Financing of Terrorism Law (2013); the Public-Private Partnership Law (2018), and an updated Labor Code (2019), have helped to develop a more modern and more transparent legal framework for foreign investment. Due to STP’s reliance on outside investment, the government has focused its efforts on fighting corruption, restoring infrastructure, improving the business environment, reforming the justice system and public administration, attracting FDI, promoting economic growth, and social justice.

STP’s Exclusive Economic Zone (160,000 km2) may hold opportunities for hydrocarbon production as technology improves. The STP government signed a June 2022 agreement with the People’s Republic of China (PRC) to expand and modernize the international airport (Airport Nuno Xavier), with plans to start the project in early 2023, though the work has not yet commenced. STP is using World Bank funding to rehabilitate the road linking the capital to the north of the island and support from the African Development Bank to rehabilitate rural infrastructure, including roads. Foreign investors continue to face challenges identifying viable investment opportunities due to STP’s small and fragile domestic market, inadequate infrastructure, slow moving justice system, high cost of credit, and expensive electricity to which there is limited access. With Europe as a primary source of imports, Russia’s war of aggression against Ukraine led to doubling of the price of most food products. Inflation rose from 9 percent at the end of 2021 to 24 percent by the end of 2022.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2022 65 of 180
Global Innovation Index 2022 N/A
U.S. FDI in partner country (US $ million, stock positions) 2021 $21
World Bank GNI per capita 2021 $2,360

Policies Towards Foreign Direct Investment

According to Article 4 of the Investment Code, both domestic and foreign investors are free to establish and own business enterprises, as well as engage in all forms of business activity in STP, except in the sectors defined by law as reserved for the state, specifically military and paramilitary activities, and Central Bank operations. STP is gradually moving towards open competition in all sectors of the economy, and competitive equality is the official standard applied to private enterprises in competition with public enterprises regarding access to markets, credit, and other business activities. The government has eliminated former public monopolies in farming, banking, insurance, airline services, telecommunications, and trade (export and import).

São Tomé and Príncipe is taking steps toward sustainable economic growth. Its economic prospects depend on the government’s ability to reinforce the capacity of its small and medium-sized enterprises (SMEs) and attract sustainable foreign direct investment. Therefore, the government is eager to improve the country’s investment climate, including by modernizing the justice system and restoring infrastructure to make it a more attractive destination for foreign investors. Under Article 14 of the Investment Code, the State guarantees equal and non-discriminatory treatment to both foreign and domestic investors operating in the country. The Trade and Investment Promotion Agency (APCI), housed in the Ministry of Planning, Finance, and Blue Economy, promotes and facilitates investment through a “single window” service and multi-sectoral coordination. However, the agency is still struggling to fully comply with its mandate due to a lack of capacity.

Limits on Foreign Control and Right to Private Ownership and Establishment

There are no limits on foreign ownership or control except for activities customarily reserved for the state. The form of public participation, namely the percentage of government ownership in joint ventures, varies according to the agreement. Based on Article 8 of the Regulation of the Investment Code, all inbound investment proposals must be screened and approved by the applicable ministry for the economic sector in coordination with APCI. According to Article 14, an investment proposal can be rejected if it threatens national security, public health, or ecological equilibrium, and if the proposal has a negative effect or insufficient contribution to country’s economy. The government encourages but does not require the hiring of the local workforce.

Other Investment Policy Reviews

STP is not a member of the Organization for Economic Cooperation and Development (OECD) and has not participated in in any investment policy reviews conducted by the body. Neither the World Trade Organization (WTO) nor United National Conference on Trade and Development (UNCTAD) has conducted a review. STP has also not received a visit from the Office of the High Commissioner on Human Rights Working Group on Business and Human Rights.

Business Facilitation

STP has taken steps to facilitate investment and improve the business environment in recent years. The Millennium Challenge Corporation (MCC) worked with STP from 2007 to 2011 on a Threshold Country Program to improve investment opportunities, including by creating a “one-stop shop” to help encourage new investments by making it easier and cheaper to import and export goods, reducing the time required to start a new business, and improving STP’s tax and customs clearance administration. Currently a business can be registered within one to five days. In 2013, with the support of the International Trade Center, the Trade and Investment Promotion Agency (APCI) was created. APCI’s business facilitation services, including a “one-stop shop” for business registration, offer equal treatment for women and underrepresented minorities in the economy; however, there is no special assistance provided to these groups. A Single Window website  (in Portuguese only) provides information and the application form needed to create and register a company in STP. Information on tax administration can be requested from the Tax Directorate  in the Ministry of Planning, Finance and Blue Economy. While the National Institute for Social Security  in the Ministry of Health and Social Affairs provides information on social security.

The visa application process is straightforward and transparent, and visas or work permits are typically easy to obtain if companies meet all the requirements. Nevertheless, few São Toméan embassies worldwide process visa applications. The country lifted visa requirements for citizens of the United States, EU, Canada, UK, South Africa, Rwanda, and the Community of Portuguese Language Countries. U.S. passport holders can stay up to 15 days without a visa. In addition, any foreign citizen holding a valid passport with a valid Schengen or U.S. visa can enter and stay in the country up to 15 days. STP recently began accepting online visa applications . Visa applications can also be done via email  or in person. In March 2022, the government approved a decree stating that effective June 1, 2022, visa-exempt visitors must pay an entry fee of STN 500 (roughly USD 23). The government lifted all Covid-19 related travel measures, including a negative test and vaccine certificate requirement for entry in August 2022.

Outward Investment

While STP’s government does not actively promote outward investment, it does not restrict domestic investors from investing abroad. STP also has signed Investment Protection Agreements with several countries.

STP and Portugal signed a bilateral investment treaty (BIT) and a Double Taxation Agreement in 1995 and 2015, respectively. It has also signed BITs with Angola (1995), Cabo Verde (2019), and Mauritius (2016). STP has not signed a BIT or a bilateral taxation treaty with the United States. There are no ongoing systemic tax disputes between the government and foreign investors or any taxation issues concerning U.S. investors.

Transparency of the Regulatory System

The laws and regulations that affect direct investment, including environmental, health, and safety rules and regulations, apply equally to foreign and domestic firms. Before approval, investment proposals are evaluated for their environmental impacts by the Ministry of Environment and for their social impacts by the Ministry of Social Affairs and the Ministry of Finance. STP’s tax laws reward citizens who return to STP to invest, while also containing provisions for attracting foreigners to invest in STP. The STP legal code is based on Portuguese law, and laws and regulations are applied at the national level. Rule-making and regulatory authority exist at the national level and regulations are developed at the ministerial level, approved by the National Assembly, and promulgated by the President. The ministry concerned is responsible for any regulatory enforcement mechanisms. Rarely, draft bills or regulations are made available for public comment. Copies of most regulations can be purchased online at  or directly at the Ministry of Justice, Public Administration, and Human Rights in the format of the Official Gazette. The public finances and debt obligations are relatively transparent and are periodically available on the Ministry of Finance website: 

International Regulatory Considerations

STP is a member of the Economic Community of Central African States (ECCAS), whose fundamental goals are to promote exchange and collaboration among the member countries and provide an institutional and legal framework to their cooperative efforts. In the last Africa Regional Integration Index (2019), STP had an average score for integration within the regional economic community, including on trade, infrastructure, and free movement of people. ECCAS is the largest economic community in Central Africa, including Central African Economic and Monetary Community (CEMAC) member states (Cameroon, the Central African Republic, Chad, Republic of Congo, and Equatorial Guinea, and Gabon), as well as Burundi, the Democratic Republic of Congo, Angola, Rwanda, and STP. STP is also a member of the Community of Portuguese Language Countries (CPLP) and its economic confederation (CE). STP is not a member of the WTO, but it does have observer status. STP is among the 46 African Nations to have signed the agreement on African Continental Free Trade Area (AfCFTA), having signed in March 2018 in Kigali, Rwanda, and became the 25th African country to ratify the AfCFTA in June 2019.

Legal System and Judicial Independence

The legal system is based on Portuguese civil law with elements of customary law. Investment disputes are generally solved through dialogue or negotiations between parties without litigation. However, in January 2023, the government suspended a ports concession agreement signed in August 2022 between the previous government and the Ghanaian Consortium Safebond. The agreement would have granted Safebond a 30-year management agreement for the existing port in Sao Tome (Ana Chaves) and port in Principe (Santo António), and Safebond pledged to build a US $400 million to $500 million deep seaport within five years’ time. In February 2023, Safebond filed a complaint against the government through the Supreme Court asking for a reversal of the new government’s decision, alleging that Safebond was accumulating enormous losses.

There have been a few instances of disagreements involving foreign investors reaching international courts, though the most recent case, involving the government and Portuguese-owned National Investment Bank was dismissed by the UN Commission on International Trade Law (UNCITRAL) and the Permanent Court of Arbitration in 2021. The country has a written commercial law but does not have specialized courts, so commercial cases are tried by the country’s civil courts.

Per article 121 of the constitution, which dates to 1975 and was most recently updated in 2003, “the courts are independent and subject only to the laws.” However, the direct appointment of judges by the National Assembly creates space for ruling party influence Article 40 of the constitution provides for fair trials, but the judicial process is subject to manipulation on occasion. All regulations or enforcement actions are appealable to the Supreme Court.

Laws and Regulations on Foreign Direct Investment

The Value-Added Tax (VAT) Law (13/2019) approved in 2019 will be in force from June 1, 2023, and the government  is working closely with the IMF  to implement the VAT system. The VAT rate will be 15 percent, while items in the basic basket of goods will be taxed at a rate of 7.5 percent. Additionally, a special rate of 2 percent will be applied for companies that have a business volume of less than 100,000 dobras ($4,470), with a rate of 7 percent for companies earning between 100,000 and 1 million dobras ($4,470 – $44,654) per year.

A modern Labor Code (6/2019) enacted in April 2019, is designed to make labor standards easier for investors to understand and implement. In June 2019, STP ratified the African Continental Free Trade Area agreement (AfCFTA). The Public Private Partnership (PPP) Law, the new Notary Code, and the Commercial Register Code all entered into force in 2018; the Regulation of Investment Code was adopted in 2017; and the Investment Code and Code of Fiscal Benefits and Incentives were adopted in 2016. The Trade and Investment Promotion Agency (APCI) is a one-stop shop for all investment information.

Following the creation of APCI, the cost and waiting period to start a new business have been substantially reduced. A new business can obtain expedited registration within 24 hours for an increased fee and otherwise within five days. The fee schedule based on the type of business to be created follows:

  • Limited liability companies, between 3-5 days for STN 4,015 (US $178) or within 24 hours for STN 5,761 (US $256).
  • Private limited companies between 3-5 days for STN 6,015 (US $267) or within 24 hours for STN 8,765 (US $390).
  • Joint-stock companies between 3-5 days for STN 15,000 (US $667) or within 24 hours for STN 22,265 (US $989).

Although no online business registration process exists, companies can register their businesses at the Single Window (GUE) counter in person with the process spanning between one and five days. The following is a general description of how a foreign company can establish a local office:

1.  Provide full company documentation, translated into Portuguese. The GUE sends this information to the Ministry of Justice ahead of the next step.
2. Check the uniqueness of the proposed company name and reserve a name.
3. Notarize the company statutes with the registration office at the Ministry of Justice.
4. File a company declaration with the Tax Administration Office at the Ministry of Finance, Commerce, and Blue Economy.
5. Register with the Social Security Office at the Ministry of Labor and Social Affairs.
6. Publish the incorporation notice in the official government gazette (Diário da República).
7. Publish the incorporation notice in a national newspaper.
8. Register the company with the Commercial Registry Office at the Ministry of Finance, Commerce, and Blue Economy.
9. Apply for a commercial operations permit (also known as an “alvara”), issued by the Directorate of Commerce.
10. Apply for a taxpayer identification number with the Office of Tax Administration at the Ministry of Finance, Commerce, and Blue Economy.
11. Register employees with the Social Security Office.

Other required documents include: 1) copies of the by-laws of the parent company and of the minutes of the meeting of the board of directors in which the opening of the STP branch is approved; 2) a certificate of appointment of the general manager for the STP office; 3) a copy of any agreement signed with a São Toméan company or with the STP government; 4) two copies of permits from the court granting authorization to operate; and 5) two photographs and a copy of the passport of the general manager.

In addition, the Single Window website  ( ; in Portuguese only) provides information on creating and registering companies in STP.

Beyond the APCI’s “one-stop shop,” there are no agencies or legal brokers that provide services to further simplify the procedures for establishing an office in STP. Generally, foreign companies consult with a law firm for assistance.

Competition and Antitrust Laws

The Directorate of Regulation and Control of Economic Activities (DRCAE) has the mandate to inspect all economic activities and impose penalties, but it lacks the resources necessary to fully perform its duties. DRCAE is housed under the Ministry of Planning, Finance and Blue Economy.

The General Regulatory Authority of the Democratic Republic of São Tomé and Príncipe (AGER) was created to promote competition and prevent operator abuses in the water, electricity, and telecommunications sectors, as well as for the postal service. The AGER was established in 2005 and is housed under the Ministry of Infrastructure, Natural Resources, and Environment.

Expropriation and Compensation

The STP Constitution and the Expropriation Code allows only the central government to expropriate private property. The law permits expropriation of private property only if it is deemed to be in the national public interest and only with adequate compensation. There is no evidence to suggest that the government would undertake expropriation in a discriminatory manner or in violation of established principles of international law and standards.

Aside from a massive land expropriation from colonial farmers in 1976 – later recognized by the government as detrimental to STP’s economy – there have not been any documented cases of expropriation of foreign-owned properties. The government has reportedly considered expropriating land to expand the runway at the international airport, but thus far has reportedly been reluctant to do so out of concern that expropriation will deter new investment.

Dispute Settlement

ICSID Convention and New York Convention

STP is a member of the International Centre for the Settlement of Investment Disputes (ICSID) Convention and the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958 New York Convention).

Investor-State Dispute Settlement

STP does not have a Bilateral Investment Treaty with the United States. In February 2023, a Ghanaian port administration consortium filed a complaint against the STP Government in the Supreme Court against the STP government for suspending a 30-year port concession agreement signed with the previous government in 2022. In May 2018, a dispute between a local businessperson and an Angolan investor over a brewery led to government intervention and the unconstitutional approval of a parliamentary resolution dismissing Supreme Court Judges, including the court’s President. There are no reports of investor-state disputes involving a U.S. person in the past 10 years. STP courts recognize and enforce foreign arbitral awards issued against the government.

International Commercial Arbitration and Foreign Courts

STP does not have any conflict mediation system, but the country has a Voluntary Arbitration Law (LAV), enacted in 2006. The LAV is largely based on the Portuguese Arbitration Act of 1986 and incorporates principles of the UNCITRAL Model Law. The Arbitration Center, which was created as part of the LAV, has been overseen by the Chamber of Commerce, never fully carried out its role. However, in 2022, the UNDP helped construct an Arbitration Center building scheduled to be inaugurated by the end of April 2023. It has not yet been inaugurated. The Arbitration Center will still be managed by the Chamber of Commerce, Industry, Agriculture, and Services.

The STP legal system recognizes international arbitration, and local courts recognize foreign arbitral awards, though enforcement may be difficult. The state-owned enterprise (SOE) for Port Administration, National Enterprise for Port Administration (ENAPORT), is involved in an investment dispute with the Ghanaian Consortium Safebond over the government’s suspension of a port concession.

Bankruptcy Regulations

STP has a bankruptcy law, but it is not well developed. In January 2022, the STP-based commercial bank Energy Bank, founded in 2011 by a Nigerian investor, declared bankruptcy. This led to the Central Bank cancelling the bank’s financial operations in STP.

Investment Incentives

According to the 2016 Investment Code, all investments, including those for clean energy, above 50,000 Euros ($55,000) are eligible for guarantees and benefits, including fiscal incentives stated in the Fiscal Benefits and Incentives Code of November 2016. These incentives include deductions on corporation taxes, stamp taxes, taxes on banking operations, and withholding taxes. Other incentives include reductions or exemptions of import and re-export tariffs. The government also provides incentives for human resources training, as well other exceptional and complementary benefits and incentives. Based on Article 31 of the Fiscal Benefits and Incentives Code, the incentives are granted through the Private Investment Registration Certificate (CRIP) issued by the APCI following the approval of the investment project. The conditions for access to these incentives apply equally to both men and women. However, contrary to the 2008 Investment Code, the 2016 Code does not provide access to state-owned land and facilities as incentive to investments. No significant measure was adopted in the last year to incentivize investments.

Foreign Trade Zones/Free Ports/Trade Facilitation

STP currently has no free trade zones or free ports but in October 2020, the government approved a free trade zone law and formalized a free trade zone project to be developed in Malanza, Caué district, south of São Tomé. Article 33 of the Fiscal Benefits and Incentives Code defines the districts of Cantagalo, Lemba, Lobata, and Caué, as well as Príncipe, as Special Development or Economic Zones. Any new investment established in these areas under the Investment Code can qualify for special incentives. According to Article 14 of the Investment Code, the state assures fair, non-discriminatory, and equal treatment for all investment in the national territory. Companies that qualify may benefit from reductions or exemptions of taxes under the conditions set forth in the Code of Free and Offshore Activities. An update to the Free Trade Zone regime promulgated as Decree 6/2021 of March 5, 2021, permits the land on which a free trade zone is located to be granted to an investor company by the government for 50 years, and in exceptional cases, up to 90 years with a resolution by the Council of Ministers.

Performance and Data Localization Requirements

The government encourages but does not mandate local employment. STP has no specific performance requirements or data localization requirement as a condition for establishing, maintaining, or expanding investment. However, under the Code of Fiscal Benefits and Incentives, the government offers better incentives for those companies that choose to reinvest or expand their investment. The government encourages but has not defined requirements for investors to buy local products, to export a certain percentage of output, to invest in a specific geographical area, or use a domestic technology. There is no blanket requirement that STP nationals own shares in foreign investments in STP.

The National Agency for Personal Data Protection ( ANPDP ) oversees all the rules and requirements for data storage and transfer.

Real Property

Based on Article 46 of the Constitution, private property rights are guaranteed by the State. According to Article 13 of the Expropriation Code, authorities must provide fair, adequate, and effective payment at market value in advance before expropriating any private property. The government owns more than 90 percent of land in the country, most of which is agricultural land granted by the Ministry of Agriculture, Fishing, and Rural Development through concessions of land titles under the Land Reform Law. Foreigners cannot purchase land, although they can purchase structures, so investors should confirm the true ownership of land where they are attempting to acquire a structure through the Land Registry (Cadastro) within the Ministry of Infrastructure, Natural Resources, and Environment. The 2018 Notary Law provides the country with a modern and practical legal framework that allows for fast and efficient notarial acts, while ensuring judicial security. U.S. companies have not raised property rights concerns with the Embassy.

Intellectual Property Rights

U.S. companies have not raised intellectual property (IP) rights concerns with the Embassy. During the past year, no new IP related laws and regulation were enacted, nor are any reform bills pending. All copyright and industrial property rights proceedings are covered by the Directorate of Industry in collaboration with the National Directorate of Culture, under the Secretariat of State for Commerce and Industry and the Ministry of Tourism and Culture, respectively.

STP is not listed in the USTR’s Special 301 report nor in the notorious market report. STP is a member of the World Intellectual Property Organization (WIPO). The Regulation on Industrial Property covers the enforcement of IP, including geographical indications, patents, and trademarks. STP does not report on seizures of counterfeit goods. For additional information about treaty obligations and points of contact at local IP offices, please see WIPO’s country profiles at .

Capital Markets and Portfolio Investment

Portfolio investment is undeveloped and unclear. The Central Bank of STP (BCSTP) issued Treasury bills (T-bills) for the first time on June 29, 2015, for STN 75 million (approximately $3.7 million) at the fixed interest rate of 6.2 percent, with a maturity of six months. The demand was 20 percent higher than the offer, due to the participation of three domestic banks. The most recent issuance occurred on March 15, 2018. STP does not have a stock market. Articles 13 and 14 of the Foreign Exchange Regulations facilitate the free flow of financial resources under the supervision of the Central Bank. Foreign investors are allowed to apply for credit on the local market; however, access to credit is difficult due to the limited variety of credit instruments, high interest rates, and the number of guarantees requested by the commercial banks. There are no significant U.S. portfolio investors active in STP currently.

Money and Banking System

STP has four private commercial banks. Portuguese, Angolan, Cameroonian, Gabonese, Togolese, and Sao Tomean interests are represented in the ownership and management of the commercial banks. The Banco Internacional de Sao Tome e Principe (BISTP) is believed to be the largest bank in terms of assets, with just over US $123 million in net assets at the end of 2021, the last year for which it has an annual report. Asset estimations for the other banks are not publicly available. In January 2022, STP-based commercial bank Energy Bank, founded in 2011 by a Nigerian investor, declared bankruptcy leading the Central Bank to cancel all its financial operations in STP. In early 2018, the Central Bank declared the commercial bank Banco Privado insolvent and opened a public tender to liquidate its assets and liabilities. The Gabonese investment bank BGFI opened its São Toméan operation in March 2012. Banking services, especially from BISTP, are available in the capital with a few smaller branches in cities in the north, south, and center of the country, as well as in Príncipe. In 2021, the Visa card was introduced into the country’s financial system.

In addition to retail banking, commercial banks offer most corporate banking services, or can procure them from overseas. Local credit to the private sector is limited and expensive, but available to both foreign and local investors on equal terms. The country’s main economic actors find financing outside STP. Foreigners must establish residency to open a bank account.

Foreign Exchange and Remittances

Foreign Exchange

The BCSTP supervises the national financial system and defines monetary and exchange rate policies in STP. Among other responsibilities, it sells hard currency and establishes the reference rate. In case of a shortage, access to foreign currency is limited; however, there is no official norm restricting access. Article 18 of the Investment Code dictates that foreign investors are allowed to transfer or repatriate funds associated with an investment.

The Dobra (STN) is the national currency. In July 2009, STP and Portugal signed an economic cooperation agreement to peg the Dobra to the Euro rather than a weighted basket of currencies. Based on the 2017 Monetary Law, the BCSTP introduced a new currency to modernize and strengthen the country’s financial system. With the redenomination of the Dobra, starting January 1, 2018, the exchange rate moved to 24.5 Dobras per Euro. This currency peg intended to offer credible parity, minimize monetary instability costs, and provide better credibility for exchange rate and monetary policy. The exchange rate to the U.S. Dollar fluctuates based on the Dollar-Euro exchange fluctuations. It currently varies between 22.5 and 23 Dobras per dollar.

Remittance Policies

Repatriation of capital is possible with prior authorization. According to both the Foreign Exchange Law and the Investment Code, transfer of profits outside the country is also allowed after the deductions for legal and statutory reserves and the payment of existing taxes owed. The government encourages reinvestments with associated reductions in income taxes.

Sovereign Wealth Funds

STP does not have a traditional sovereign wealth fund. It does have a small National Oil Account (NOA). The NOA was previously funded by signing bonuses paid by energy and oil companies to gain rights to conduct exploration and production activities. According to officials from the budget department, the Law of Petroleum allows the government to withdraw up to 20 percent of the balance of the NOA every year as calculated on June 30 of the previous year. Details are available on the state budget and in the government’s Public Information Registry . The National Oil Account does not report any external investments.

When STP’s cocoa plantations were shut down in the late 1980s, most State-Owned Enterprises closed. Still, EMAE (Water and Power Supply Company), ENAPORT (Port Authority Company), ENASA (National Company for Airports and Air Safety), and Empresa dos Correios (Post Office) are 100 percent state-owned, though they have some financial autonomy. Under a joint venture, the government holds a 49 percent share of CST (Santomean Telecommunication Company), while the Portuguese Conglomerate Visabeira Global owns 51 percent, acquired from the Brazilian “Oi” in 2022. The government has a 48 percent stake in BISTP, while the Portuguese Caixa Geral de Depositos holds 27 percent, and the African Investment Bank holds 25 percent. All four fully owned state enterprises are unprofitable and are annually audited by the Ministry of Planning, Finance, and Blue Economy and biennially by the Court of Audit. They have financial autonomy, but largely depend on funds from the state budget. Considering their sectoral specificity, EMAE, ENAPORT, and ENASA have no local competitors, though the scuttled port management concession for management of the ports would have made the private consortium the majority stakeholder of ENAPORT, leaving the government with 25 percent. Regarding telecommunications and banking, government is traditionally the largest client of CST and BISTP.

Privatization Program

STP does not have an active privatization program. However, through its periodic reports, the IMF has recommended the privatization of the SOEs, especially EMAE. On occasion, there are concession opportunities. They are normally advertised under a non-discriminatory public bidding process with opportunities for foreign investors. The following government websites and local newspapers will post some of the opportunities to purchase state-owned assets:

To achieve its privatization goals, the government prioritizes the diversification of energy production sources with a particular focus on renewables. The government also seeks investors to refurbish rural roads, bridges, and ports to support agriculture, fisheries, tourism, and exports.

There are no rules or legislation pertaining to responsible business conduct (RBC) in STP. Companies generally act in accordance with laws pertaining to investment, labor, environment, flora and fauna protection, consumer protection, and taxation. There is limited awareness of expectations of or standards for responsible business conduct. STP participates in the Extractive Industries Transparency Initiative (EITI) though it is currently suspended. Companies usually respect human and labor rights. On occasion, civil society and NGOs speak up against businesses’ inappropriate conduct, especially as regards environmental destruction. In 2018, a group of civil society organizations and a political party contested the government’s decision to lease a large piece of land in the north of São Tomé to a Chinese business group for the establishment of a quarry. The land was part of a natural park with many preserved species of plants and animals. 

Additional Resources

Department of State

Department of the Treasury

Department of Labor

Climate Issues

STP does not have a standalone national climate strategy or strategy for enhancing environmental protection. However, its 2018 National Determined Contribution (NDC) Implementation Plan has served as a planning, coordination, transparency, and resource mobilization tool for the government. The government updated its NDC in 2021, pledging to cut emissions by 27 percent and increase the share of renewable energy in its energy mix to around 50 percent by 2030. STP has not articulated recently any specific private sector expectations or regulatory incentives to achieve climate goals. The government created a National Committee for Climate Change in 2012 and established a legal regime for the energy sector in 2014, which included prioritization of increasing renewable energy production.

STP ranked 65 out 180 countries in Transparency International’s 2022 Corruption Perception Index, climbing one position compared to the previous year. The government has taken steps to combat corruption through government reforms. The government passed an anti-corruption law in 2012 that required all payments to government entities over US $5 be made directly at the BCSTP and all salary payments to civil servants be paid directly to the employee’s bank account. The government has also taken steps to review and update existing contracts with some foreign companies to support liberalization and free market competition. The government has denounced corruption and pledged to take necessary steps to prevent and combat it.

Although the government has taken these steps, in March 2022, President Vila Nova cited a survey  carried out by a local NGO network, of judges, professors, parliamentarians, government employees, activists, religious leaders and others, showing that more than 70 percent of those individuals believed corruption was increasing.

Although corruption in the customs process was historically an issue for foreign investors, the MCC Threshold Program (2007-2011) helped establish a modern customs code and related decrees that led to the introduction of modern customs tracking software and the elimination of manual procedures, with customs agents handling payments for the importer. As a result, customs revenues have increased significantly while the incidents of customs-related corruption have reportedly declined  due to the decreased number of cash payments involving customs agents.

In 2013, the parliament adopted an amended anti-money laundering/counter-terrorist financing (AML/CFT) law that complies with international standards. It designates the Financial Information Unit (Unidade de Informação Financeira) as the central agency in STP with responsibility for investigating suspect transactions. STP is a member of the Inter-Governmental Action Group against Money Laundering in West Africa (GIABA), a FATF-style regional body.

According to the 2016 Investment Code, all investment proposals must be submitted to the APCI, which is responsible for conducting all legal inter-institutional coordination with different sectors involved in the analysis and approval of the investment project. The law limits contacts between investment proponents and officials involved in the investment approval process.

STP signed and ratified the UN Anticorruption Convention. It is not party to the Economic Cooperation and Development Convention on Combating Bribery of Foreign Public Officials in International Business Transactions.

STP does not have a designated agency responsible for combatting corruption but in 2022, the President promised to create an “Anti-Corruption Committee” comprised of reputable citizens, uncommitted to any political agenda.

Resources to Report Corruption

“Watchdog” organization:
Deodato Capela
Centro de Integridade Pública de São Tomé e Príncipe (STP Public Integrity Center) –
Anticorruption, Transparency and Integrity – NGO
P.C: 330, Almeirim-São Tomé; São Tomé e Príncipe
+ 239 991 1116 

STP is relatively stable, has no ethnic tensions, and has a relaxed lifestyle, which locals refer to as leve-leve (“take it easy”). Since its democratic reforms in 1990, the archipelago has been a positive example of democracy in the region, with a history of peaceful transfers of power and consensus in decision-making. The September 25, 2022, legislative, local, and regional elections were followed by a peaceful transfer of power from a political coalition to a new government led by the Independent Democratic Action party (ADI). International observers deemed the elections transparent, adequately organized, and generally free and fair. In July 2021, following the results of the first round of the presidential elections, the third ranked candidate contested the election’s results, alleging fraud. After back-and-forth decisions from the Constitutional Court, there was a nearly two-month delay in the holding of the second round of the presidential election. When the second round took place and observers announced that they found it to be free, fair, and transparent. The President took office in 2021 without incident. In 2018, separate protests occurred in response to the creation of the Constitutional Court, and in following lower court decision to recount the votes of the October 7 legislative, local, and regional elections. Despite the post-election protests, the legislative elections led to the peaceful formation of a new coalition Government.

STP generally has a good human rights record and demonstrates a respect for citizens’ and workers’ rights. However, in 2021 and 2022, there were reports that agents of the government committed arbitrary and unlawful killings. In November 2022, four civilians died while in the custody of military forces in the wake of an attack on army barracks, which the government claimed was an attempted coup d’etat. Three of the suspected attackers were captured at the barracks, where they were reportedly beaten and killed. A fourth individual was arrested at home the same day by military forces on allegations of involvement in the attack. He later died after reportedly falling out of a truck while in military custody. Videos and photographs of the alleged beatings circulated widely on social media. Following an investigation conducted by the local judiciary authorities in collaboration with the Portuguese Judiciary Police, on March 16, the Public Prosecutor’s Office issued an order accusing 23 military officials of the torture and death of the four men. Among the 23 accused military personnel were the former Army Chief of Staff, the current Deputy Chief of Staff, Captain of Sea and War, and the Army Commander. These three high rank officials were accused of not doing enough to protect the detainees.

In a March 2021 case, a suspect apprehended for attacking his wife died at the hospital after being beaten in a cell while in the custody of judicial police. The public attorney general brought criminal charges against seven police investigators in the case, with three of the accused investigators facing up to 24 years in prison on charges that included homicide. Their trials began by the end of 2021 and have not yet been decided.

Strikes are not seen as the primary means to settle labor disputes and labor strikes have been sporadic in recent times.

Since independence in 1975, there have been no incidents of politically motivated attacks on projects or installations. There is no anti-American sentiment and instances of civil disorder are rare. Recently maritime piracy has affected STP’s territorial waters in the Gulf of Guinea, though the threat of terrorism remains limited. STP has sought to be an active partner in regional maritime security efforts, although its capacity and resources are minimal. Despite two violent murders in early 2020, including one Portuguese national, violent crime rates remain low.

A significant portion of STP’s workforce is young, relatively well-educated, and multilingual (Portuguese and French). Further training of the workforce is needed, however, for the economy to continue developing. The percentage of foreign/migrant workers is low, but all workers are protected under the Labor Code (Law 6/2019). The government encourages companies to hire STP nationals, but there is no requirement. In 2022, after negotiations with the labor unions, the government increased the monthly minimum wage for civil servants from US $50 to US $112, with an expected increase to US $157 in 2023 and US $202 in 2024. The unions also announced a leave allowance payment granting employees an additional 40 percent of their salary when they take leaves of absence as of May 2022. Discussions continue on implementing a full leave allowance, which would double workers’ salaries when they are on leave. However, the 2023 State Budget Proposal submitted to the National Assembly by the government in April did not include the salary increase as agreed, with the government stating the country’s current economic situation did not allow for it. The government set the national minimum wage for the private and public sectors for the first time in 2016. The basic salary varies by the size of the enterprise. For micro enterprises or family businesses, the minimum wage is around STN 800 (US $35.50) per month, small business STN 1,000 (US $44.40), medium enterprise STN 1,300 (US $57.70) and large enterprise STN 1,600 (US $71.00).

Women are entitled to state-funded maternity leave for a period of 14 weeks, including 8 weeks after childbirth. The law recognizes the right of workers to form and join independent unions, conduct legal strikes (though this is strictly regulated), and bargain collectively. The law does not prohibit anti-union discrimination or retaliation against strikers. Workers’ collective bargaining agreements remain relatively weak due to the government’s role as the principal employer and key interlocutor in labor matters, including wages. Special tax incentives are provided under the Fiscal Benefit Code to companies that provide training to its human resources. Labor disputes are usually solved through dialogue between parties, under mediation of the General Labor Inspection Department (IGT), or through litigation if a consensus cannot be reached. The Labor Law was drafted in collaboration with the ILO. The IGT is housed under the Labor Ministry. The country has experienced increasing human capital flight in recent years, with many young and skilled people flying to Europe, especially to Portugal, for economic opportunity. According to the Fund for Peace, Sao Tome scored a 7.6 out of 10 on its 2022 Human Flight and Brain Drain index, with 10 being the highest value and a survey. In a July 2022 study conducted by the National Youth Council, with support from UNDP, 80 percent of the country’s youth said they want to leave the country due to the lack of opportunity.

STP’s private sector is underdeveloped, undiversified, and dominated by a large number of informal operators, representing 68 percent of overall employment as of 2020, who work mainly in civil construction, agriculture, commerce and fisheries, with a low level of education, lack of organizational and managerial skills, absence of structured accounting systems, as well as minimal business planning procedures in the medium/long term.

According to a government official, there are a total of 23,000 civil servants. The World Bank estimated STP’s 2021 total labor force to be over 71,000; among the total number, roughly 31,500 are female between the ages of 15-64 years old: .

While the U.S. International Development Finance Corporation (USDFC) is authorized to do business in STP, there have never been any such programs in the country to date.

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2021 $505 2021 $526.7
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2021 $21.0 BEA data available at

Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2021 $0.0 BEA data available at

Total inbound stock of FDI as % host GDP 2021 11.7 % 2021 81.9% UNCTAD data available at

* Source for Host Country Data:


Inbound Stock of FDI:, Boletim Estatistica 1st Quarter 2022.

Table 3: Sources and Destination of FDI

Data Not Available.

Ronalg Carvalho
Political-Economic Assistant
U.S. Embassy Luanda

On This Page

  2. 1. Openness To, and Restrictions Upon, Foreign Investment
    1. Policies Towards Foreign Direct Investment
    2. Limits on Foreign Control and Right to Private Ownership and Establishment
    3. Other Investment Policy Reviews
    4. Business Facilitation
    5. Outward Investment
  3. 2. Bilateral Investment and Taxation Treaties
  4. 3. Legal Regime
    1. Transparency of the Regulatory System
    2. International Regulatory Considerations
    3. Legal System and Judicial Independence
    4. Laws and Regulations on Foreign Direct Investment
    5. Competition and Antitrust Laws
    6. Expropriation and Compensation
    7. Dispute Settlement
      1. ICSID Convention and New York Convention
      2. Investor-State Dispute Settlement
      3. International Commercial Arbitration and Foreign Courts
    8. Bankruptcy Regulations
  5. 4. Industrial Policies
    1. Investment Incentives
    2. Foreign Trade Zones/Free Ports/Trade Facilitation
    3. Performance and Data Localization Requirements
  6. 5. Protection of Property Rights
    1. Real Property
    2. Intellectual Property Rights
  7. 6. Financial Sector
    1. Capital Markets and Portfolio Investment
    2. Money and Banking System
    3. Foreign Exchange and Remittances
      1. Foreign Exchange
      2. Remittance Policies
    4. Sovereign Wealth Funds
  8. 7. State-Owned Enterprises (SOEs)
    1. Privatization Program
  9. 8. Responsible Business Conduct
    1. Additional Resources
    2. Climate Issues
  10. 9. Corruption
    1. Resources to Report Corruption
  11. 10. Political and Security Environment
  12. 11. Labor Policies and Practices
  13. 12. U.S. International Development Finance Corporation (DFC) and Other Investment Insurance Programs 
  14. 13. Foreign Direct Investment Statistics
  15. 14. Contact for More Information
2023 Investment Climate Statements: Sao Tome and Principe
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