The International Monetary Fund has disclosed an unprecedented $7 billion in hidden debt in Senegal, accumulated from 2019 to 2024 under former President Macky Sall. This revelation has led to the suspension of ongoing negotiations for a new loan program with Dakar, raising concerns about the country’s financial stability and future economic prospects.
The International Monetary Fund has revealed an unprecedented amount of undisclosed debt in Senegal, totaling approximately $7 billion, which accumulated between 2019 and 2024 during the administration of former President Macky Sall.
This staggering figure, described by the IMF as “unprecedented,” has led to the suspension of ongoing negotiations regarding the resumption of a new loan program with Dakar. Following a two-week mission in the Senegalese capital, the head of the IMF mission, Edward Gemmell, stated that “Senegal’s situation with hidden debt of this magnitude is unprecedented in Africa,” according to a local source.
Gemmell explained that this situation accounts for the slow progress in negotiations that began last August to reach a new financing agreement.
The IMF emphasized the need for “corrective measures” before any financial commitment, including consolidating debt management within a single ministry and publishing audit results on financial arrears to enhance transparency and prevent the recurrence of such practices.
Despite the IMF’s attempts to reassure Senegalese authorities by stating that “it is rare to finalize an agreement after the first visit,” the financial situation remains concerning. The absence of new financial support could exacerbate budgetary pressures, especially after the credit rating agency Moody’s downgraded Senegal’s rating three times within a year, citing a “concerning debt trajectory” that has reached 132% of gross domestic product.
Nevertheless, the IMF has confirmed its commitment to swiftly reaching an agreement, although it has not specified a clear timeline for concluding negotiations, leaving the Senegalese economy in a state of anticipation and concern regarding the next steps.
Senegal has faced various economic challenges in recent years, including rising debt levels and fiscal pressures. The previous administration under President Macky Sall saw significant borrowing, which has now come under scrutiny due to the revelation of hidden debts.
The IMF’s findings highlight the need for transparency and reform in the country’s financial management to restore confidence among international lenders and investors. The situation underscores the broader issues of governance and economic policy in the region.
