Sao Tome and Principe has agreed a €25m ($36m) credit line with Portugal to link the dobra to the euro.
The island, a former Portuguese colony, last week signed the arrangement, which is similar to the deal agreed with Cape Verde ten years ago.
With GDP per person at $1,300, Sao Tome is one of the world's poorest countries. It is hoped that the move to peg the dobra to the euro will result in the country experiencing a similar growth path as Cape Verde has in the past decade.
The economy is heav