The International Monetary Fund has concluded its most recent mission to Senegal without announcing a new lending arrangement, though both sides say discussions are progressing and a deal could still be reached in the near future. IMF officials signaled that negotiations are ongoing as Dakar works to restore confidence after uncovering large volumes of previously undisclosed public debt.
The talks reflect Senegal’s effort to reset relations with the Fund following revelations that reshaped the country’s fiscal outlook.
Hidden Debt Complicates New Programme
Last year, Senegal’s government disclosed billions of dollars in liabilities that had not been reported to the IMF by the previous administration. As a result, the Fund suspended a 1.8-billion-dollar programme that had been in place and began reassessing the country’s financial position.
IMF estimates now place Senegal’s total public debt at more than 130 percent of gross domestic product, including domestic payment arrears. To move forward, Senegal is seeking approval for a new lending programme alongside a formal waiver related to the earlier debt misreporting.
Budget Targets Raise Caution Flags
Senegal’s authorities have outlined an ambitious fiscal consolidation plan, aiming to steadily reduce budget deficits over the next two years. While IMF officials acknowledged the government’s commitment to tightening public finances, they cautioned that projected tax revenues may be overly optimistic and could pose risks if economic conditions weaken.
The Fund stressed the importance of realistic assumptions to ensure that deficit reduction efforts remain credible and sustainable.
Debt Strategy Still Under Review
Key technical work remains unfinished, particularly a detailed debt sustainability assessment that will determine the shape of any future IMF support. That analysis will help decide whether Senegal can manage its debt through standard refinancing measures or whether deeper action — such as restructuring or extending maturities — may be required.
Senegal’s finance ministry has indicated that it prefers to continue managing its obligations through conventional debt operations, both at home and abroad, to limit financial vulnerabilities.
Determination to Restore Confidence
Despite the absence of an immediate agreement, IMF officials emphasized that Senegal’s leadership appears highly committed to reversing the debt trajectory. Investors remain divided over what conditions the Fund may ultimately impose, but IMF representatives noted that the government’s consolidation plans signal strong political will.
With negotiations expected to continue in the coming weeks, both sides say the goal remains clear: to finalize a framework that stabilizes Senegal’s finances and lays the groundwork for renewed international support.
