West Africa: IMF Visits Senegal as Nation Seeks New Funding Deal

Senegal's Economic Situation - Senegal faces a significant challenge with $7 billion in debt that went undetected for nearly five years [2] - Debt to GDP ratio has exceeded 100%, and the budget deficit has increased [3] - The IMF seeks guarantees that the financial irregularities will not recur [4] IMF Intervention and Conditions - The IMF has disbursed $700 million of a $18 billion program, with further disbursements contingent on conversations [6] - The IMF aims to reduce Senegal's debt to GDP ratio to 50% [5] - The IMF recommends eliminating subsidies, especially on fuel and power [10] Potential Solutions and Challenges - Senegal needs to raise $5 to $10 billion, which cannot be sourced domestically [7] - Without an IMF program, international partners are hesitant to provide financial assistance [8] - Senegal is considering renegotiating oil and gas contracts, import taxes, and taxes on SMEs [9] - Austerity measures and tax increases may face resistance from the population [9][10]