Global financial institution the International Monetary Fund (IMF) estimates that Senegal’s economic growth will hit 7.1% in 2024 and 10.1% in 2025. The country’s current account deficit is also expected to narrow due to hydrocarbon production and fiscal consolidation efforts.
A team from the IMF met with Cheikh Diba, Senegal’s Minister of Finance and Budget, and Abdourahmane Sarr, Minister of Economy, Planning and Cooperation, to review the progress of programs such as the US$1.5 billion Extended Fund Facility (EFF) and Extended Credit Facility (ECF) – an IMF program providing financial assistance to countries facing balance of payments issues – and the US$320 million Resilience and Sustainability Facility – a program providing financing to countries undertaking reforms.
Edward Gemayel, Division Chief at the IMF, stated that “All performance criteria for end-December 2023 have been met. All but one indicative target has been met. Additionally, progress has been made on structural reforms, with three out of six benchmarks for the second review under the EFF/ECF program already completed.”
Going forward, the government is focused on realizing the implementation of structural reforms. To address rising energy subsidies and interest payments, the government is expected to propose a supplementary budget to parliament, raising the fiscal deficit to 4.5% of GDP. The country also plans to boost domestic revenue and gradually phase out energy subsidies as part of the government’s fiscal consolidation strategy.
With regards to fiscal measures, Senegal is enhancing financial governance to increase transparency and exit the grey list; strengthening the National Office Against Fraud and Corruption and expanding its role; while advancing governance in the extractives sector.
