The International Monetary Fund (IMF) has reached an agreement with Senegal for a new $2.2 billion loan program aimed at supporting the country’s economic and financial reform efforts from 2026 to 2029. This move follows the suspension of a previous $1.8 billion aid deal in 2023 after the discovery of previously unreported debt in Senegal’s public accounts.
The current government, led by President Bassirou Diomaye Faye, which came to power following an opposition electoral victory, accused the former administration of ex-president Macky Sall (2012–2024) of concealing the full extent of Senegal’s fiscal challenges. This underreporting prompted the IMF to halt its earlier assistance until new information and commitments were provided by the new government.
The latest 36-month arrangement, announced on Tuesday, includes conditions requiring "decisive corrective measures" as part of a request for a waiver tied to the earlier misreporting of financial data. While the agreement marks a significant step forward, it remains subject to approval by the IMF’s executive board.
Senegal’s Finance Minister Cheikh Diba described the agreement as a “technical” milestone that opens the door to future financing. Several IMF missions have assessed Senegal’s fiscal situation since mid-October, leading to negotiations on this new program. Mercedes Vera Martin, head of the IMF’s African Department mission to Dakar, noted that Senegal has taken steps to enhance transparency, including conducting multiple audits and reconciling historical financial data to reflect the newly identified debt.
Senegal faces a challenging debt load, with public-sector debt estimated at 132 percent of GDP at the end of 2024, among the highest in sub-Saharan Africa. Despite this, the country managed to reduce its fiscal deficit from 13.4 percent of GDP in 2024 to 6.4 percent in 2025, primarily through spending cuts. Senegal has continued to finance itself mainly via regional financial markets, though this approach carries higher costs compared to loans from multilateral institutions.
The IMF also highlighted the need for assurances of additional financing from Senegal’s international partners to support the program. Moody’s recently downgraded Senegal’s long-term foreign-currency debt rating to Caa2 from Caa1, underscoring concerns about fiscal sustainability amid ongoing negotiations.
Political tensions within Senegal could impact the implementation of IMF reforms. President Faye’s relationship with his former prime minister, Ousmane Sonko, deteriorated earlier this year over various issues, including the IMF program. Sonko was dismissed as prime minister in May but was subsequently elected speaker of the National Assembly, a position that might complicate reforms. Unlike Faye, who favors engagement with the IMF, Sonko opposes any form of debt restructuring, labeling it a “disgrace” for the country.
Regarding debt restructuring, the IMF confirmed that the agreement includes a “debt treatment” plan, deemed a sovereign decision by Senegalese authorities. Finance Minister Diba clarified that this plan is not a traditional restructuring but an approach tailored to Senegal’s specific debt characteristics. Sonko has called for greater disclosure of the debt treatment measures and indicated that any commitments will be subject to debate in the National Assembly, where his party holds a majority.
The IMF noted that Senegal’s economy remained resilient in 2025, growing by 6.7 percent, buoyed by the first full year of offshore oil production that began in 2024, although growth outside the hydrocarbon sector slowed to 2.2 percent. This economic performance is expected to play a role in the country’s ability to meet the conditions of the new loan agreement.