São Tomé and Príncipe is one of the poorest countries in the world. It is not self-sufficient in food, and imports 90% of its supply. The economy is based on cocoa-producing plantation agriculture, but the fall of cocoa prices since the early 1980s has created serious problems for the government. One consequence of the price decline was the abandonment of post-independence socialist-style economic policies in favor of market-style policies.
Since 1987, economic policy was driven by a World Bank and IMF-sponsored structural adjustment program with the objective of weaning the economy of its dependence on cocoa exports and foodstuff imports. Since 1991, the government has imposed fiscal and economic austerity measures, continued to devalue the currency, reformed the banking sector, raised electricity and fuel prices, and continued to privatize the non-agricultural sector. In 2000, the country became eligible for $200 million in debt relief under the IMF/World Bank Heavily Indebted Poor Countries (HIPC) initiative, and international donors pledged additional aid in 2001.
Although the economy contracted in real terms in 1990 and 1991, slow growth resumed in 1992 and continued through the rest of the 1990s. It stood at 4% in 2001. Offshore oil production, the diversification of agriculture, and the promotion of tourism were the government's goals for economic growth in 2003.