Senegal is grappling with mounting fiscal strain as public debt edges toward 80% of GDP, raising concerns about sustainability and transparency in public finances. Data from the Finance Ministry released this week reveals the government’s growing struggle to balance spending with dwindling revenues and rising debt servicing obligations.
By the end of March 2025, debt servicing costs had surged 44.5% year-on-year in Q4 of 2024 to reach 822.32 billion CFA francs (\$1.4 billion). In the first quarter of 2025, they rose another 24%, driven by increasing obligations on both domestic and external fronts. Two-thirds of Senegal’s debt is owed to commercial banks, while the rest consists of unpaid supplier bills and operational arrears.
The fiscal deficit stood at 11.5% of GDP in 2024, significantly inflated by past underreporting. A government audit covering 2019–2023 uncovered large discrepancies in deficit data, casting doubt on previous fiscal reporting. Senegal’s Court of Auditors estimated that the actual debt ratio at the end of 2023 was nearly 100% of GDP, far above the 74% figure previously reported.
Despite these pressures, Senegal’s economy showed signs of resilience. Real GDP grew by 5.8% in 2024, fueled by a 15.5% jump in crude oil output following the launch of hydrocarbon production. However, non-oil GDP growth slowed to 3.5% due to political uncertainty and service sector disruptions during the 2024 presidential elections.
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Inflation eased significantly to 0.8%, down from 5.9% in 2023, thanks to falling global commodity prices and better domestic food supply. Foreign reserves also improved, rising to 4.7 months of import cover, aided by resumed bond sales and support from multilateral lenders.
Still, external grants plummeted by over 70%, highlighting donor fatigue. The IMF has frozen disbursements under its current programme pending resolution of past misreporting. Analysts say Senegal’s future stability will depend on fiscal consolidation, subsidy reform, and more transparent governance of its new oil and gas revenues.
