SAO TOME AND PRINCIPE A. Overall economic performance since 1980

GDP at current market prices is expected to have attained the level of

$34.7 million in 1984, as against $45.6 million in 1980, reflecting a decline of 6.7 per cent per year on average. The causes of this catastrophic drop in

economic activity are the fall in production and prices of cocoa, the main agricultural product accounting for about 40 per cent of GDP and from 80 to 90 per cent of export earnings. The drought experienced in the 1980s has also contributed to the economic recession. Per capita GDP fell dramatically from

$486 in 1980 to $328 in 1984.

The external public debt amounted to $75.2 million at the end of 1984.

Half of this amount had been granted on very concessional terms (1 per cent interest rate and 13-year grace period), one quarter on concessional terms (4 per cent interest rate and 8-year grace period) and the final quarter on commercial terms. Debt-servicing was estimated at $0.9 million in 1981 and r oae to $2.5 million in 1984, accounting for some 23.7 per cent of earnings from the export of goods and services. The net flow of resources amounted to

$7.9 million in 1984.

B. Main areas of focus of the national recovery programme (1986-1990)

The main areas adopted by the Government as national priorities are in the following order, (a) agriculture, with emphasis on cash crops, food crops, animal husbandry, fisheries and forestry; support for agricultural research and the development and rehabilitation of cocoa and agro-pastoral enterprises;

(b) energy programme for the rehabilitation of electric power stations, storage of petroleum products, extension of the Guegne hydroelectric power station, etc; (c) other sectors supporting agriculture, in particular industry, transport, rural development and administration; and (d) human resources development:

technical assistance to the Ministry of Agriculture, forestry training, traini~g

centre for officials, etc.

C. Highlights of policy reforms in support of the national recovery programme (1986-1990)

The current economic policy being pursued revitalizing the economy. The primary short-term country's cocoa-exporting capacity.

by the Government aims at objective is to restore the

This policy implies a large number of reforms in the following areas:

(a) restructuring public enterprises either through the conclusion of contracts with foreign partners or the establishment of mixed corporations; (b) pr ovLdLng incentives for workers in the agricultural sectors by rewarding productivity with a view to improving economic performance; (c) distribution of plots of land on which each individual can produce food crops; (d) reforming the trading system by liberalizing domestic and foreign trade; (e) adopting a monetary policy aimed at strengthening the country's currency through curbs on issuing money without corresponding increases in production; (f) mobilization of popular savings

to boost the economy with a view to gradually replacing external financing.

(1986-1990)

Millions of US dollars (i) Resources already mobilized

Domest ically Externally

Subtotal

(ii) Resources planned to be mobilized Domestically

Externally Subtotal

(iii) Estimates of likely available resources (iv) Total estimated cost of programme

(v) Resource gap

25.0

25.0

25.0 110.6 85.6

E. Estimates of debt-servicing requirements (1986-1990) (in millions of US dollars)

Type of debt

Interest Principal

Total

Official creditors 2.9

10.9 13.8

37. SENEGAL

Private creditors Total 2.9 10.9 13.8

A. Overall economic performance since 1980

The economy of Senegal has been hard hit by the persistent drought which followed the devastating effects of the 1979 oil crisis. With the decline in raw materials prices and the sharp fluctuations in the terms of trade, Senegal went thr o-rgh an extremely difficult period in which the growth of GDP in real terms averaged only 3.1 per cent yearly between 1980 and 1984. The surge in domestic demand, coupled with the deterioration in the financial situation, caused an alarming deficit in the balance of payments. External debt amounted to $1,722.8 million in 1984, about 83 per cent of which has been incurred on concessional

terms. Debt-service ratio amounted to per cent before rescheduling) in that continuously, from $460.6 million in 1980

18.1 per cent after rescheduling (28.5 year. Net resource flows fell almost to $137.7 million in 1984.

B. Main areas of focus of the national recovery programme (1986-1990)

Against this setting, the Government decided upon a stabilization programme, followed by an economic and financial recovery programme and medium- and long-term adjustment programmes to redress the situation and to re-establish the broad balances. Agriculture, conceived as a key sector, was given special attention.

The aim was to raise cereal output (maize, millet, sorghum, rice) in order to achieve food self-sufficiency, to adapt export crops (cotton, groundnuts) to world market conditions, to place greater emphasis on animal husbandry through fodder production and to settle nomadic people around water points, to revitalize the fisheries sector, to restore appropriate conditions conducive to industrial rehabilitation, to protect the environment, revitalize the soil, combat desertification, open up agricultural areas by continuing the road building programme, to cleve lop primary heal th care in the rural areas, and to promote training and extension services for the rural population.

C. Highlights of policy reforms in support of the national recovery programme 0986-1990)

In this connection, the Government intends to adopt reforms as part of the national recovery programme by:

(a) Implementing the new agricultural policy based on giving rural producers greater responsibilities and improving the environment of the agricultural sector;

(b) Giving priority to productive projects with a high economic and financial profitability and improving programmes for the rehabilitation and maintenance of existing infrastructure;

(c) Carrying out a more rigorous selection of infrastructural projects that are not directly productive by giving more consideration to costs;

(d) Making the system of public investment planning more effective;

(e) Implementing the new industrial policy as well as the new policy on the semi-public sector; and

(f) Consolidating achievements in financial reorganization.

D. Estimates of resource requirements for the national recovery programme (1986-1990)

Millions of US dollars (i) Resources already mobilized

Domestically Externally

Subtotal

(ii) Resources planned to be mobilized Domestically

Externally Subtotal

(iii) Estimates of likely available resources (iv) Total estimated cost of programme

(v) Resource gap

68.3 449.0

517.3

517.3 777.3 260.0

E. Estimate of debt-servicing requirements (1986-1990) (in millions of US dollars)

Type of debt

Official creditors Private creditors Total

Interest 271.0 82.3 353.3

Principal 487.8 233.5 721.3

Total 758.8 315.8 1 074.6

38. SEYCHELLES