Business and politics in São Tomé e Príncipe: From cocoa monoculture to petro-state

While the islands of São Tomé e Príncipe (STP) were once a leading cocoa producer, cocoa production is now relatively insignificant and the country is little known today outside the lusophone world. But STP could soon gain strategic and economic importance as its territorial waters are suspected to hold large quantities of crude oil. This article explores STP's shift away from domination by cocoa exports, narrating the decline and final collapse of the plantation economy and the country's slide towards overwhelming dependence on external assistance in the form of foreign aid and external debt. In this context, it calls STP an unviable state as its fledgling domestic economy fails to generate enough revenue to sustain its highly import-reliant consumption patterns. But it finds STP on the verge of another major transformation as it is likely to become a crude oil producer within a few years. In the course of this research, the authors came across major irregularities in the conduct of the country's oil policy and some of this information appears for the first time in the public domain. In this context, their research points to opportunities for rent-seeking and corrupt behaviour, which stem from access to foreign aid and natural resources.