The African Development Bank Group (AfDB) and the Government of São Tomé and Príncipe have deepened their development partnership with $18 million in new grant financing.
Signed on Thursday at the São Tomé and Príncipe Investment Forum in Brussels, the three agreements will support energy, climate-smart agriculture, and integrated water-energy-food security.
The first agreement delivers $7.5 million for the third phase of the Fiscal Sustainability and Resilience Program -Supplementary Financing (FSERP-SF) – part of a budget support operation, launched in December 2023. This brings the cumulative value to $20 million to be disbursed directly into the national budget.
The programme drives reforms across two pillars: fiscal sustainability and energy sector transition. Under the programme, the Government of São Tomé and Principe committed to critical reforms to the public procurement system, customs, and debt management.
On energy transition – a top priority in the country’s National Development Plan – the programme finances improved governance of the national utility, tariff adjustments for cost recovery, and an accelerated transition to renewable energy sources. This policy framework complements investment in energy transformation in generation and distribution infrastructure. The Nigeria Trust Fund (NTF), administered by the African Development Bank, finances this third phase.
The second financing agreement channels the Global Environment Fund’s (GEF) resources into the Co-Management of Climate Extremes for Agriculture and Fisheries Resilience Project (PRIASA III). The goal is to strengthen agriculture and fisheries value chains while deploying climate-resilient technologies to safeguard livelihoods against droughts, floods, and water scarcity.
With a total investment of $18.9 million, including $10 million in AfDB financing and $8.9 million from GEF, the project will be implemented through three components: enhancing value chains and socio-economic benefits, reducing vulnerability through climate-smart technologies and capacity building, and ensuring effective project management for integrated climate adaptation in agriculture and fisheries.
The third agreement is for a $1.4 million Project Preparation Facility (PPF) for the Water-Energy-Food Security Nexus under the NEW-ERA initiative, to drive sustainable development in the water, energy, and agriculture sectors.
Over two years, the facility will develop critical studies and master plans for integrated water resources management, including a multipurpose dam development, a water treatment plant, climate-resilience measures, and a city-wide sanitation plan.
The PPF lays the groundwork for future investments to deliver universal access to potable water, explore potential hydropower generation, and improve food production by 2030, while strengthening governance and stakeholder capacity. The project will create jobs, enhance ecosystem resilience, and support the country’s climate commitments.
African Development Bank’s Country Manager for Angola and São Tomé and Principe Pietro Toigo said: “As São Tomé and Principe presents to the global community its National Development Plan and approaches investors to power its private sector, these three financing agreements are a clear sign that the African Development Bank stands with the country as a provider of patient capital and risk mitigation”.
As of 30 November 2025, the African Development Bank Group’s active portfolio in São Tomé and Principe totals about $89.4 million, spread across 12 financing instruments, with an average age of 4.2 years and a disbursement ratio of 49.5 percent. Its sectoral distribution is led by agriculture (43 percent), followed by multisector operations (23 percent), finance (17 percent), energy (15 percent), and water (two percent).
The Bank’s portfolio reflects a strong emphasis on resilience, food security, energy transition, and macroeconomic reforms, alongside growing engagement in the green and blue economy and financial infrastructure.
