IMF, Senegal Reach Staff-Level Deal on $2.2bn Programme

By Mintesinot Nigussie  |  September 2, 2026

The International Monetary Fund and Senegal have reached a staff-level agreement on a proposed 2.2 billion US dollars financing programme aimed at restoring fiscal sustainability and supporting economic reforms, but approval remains conditional on corrective action over a past misreporting case.

The 36-month programme, under the IMF’s Extended Credit Facility, would provide Senegal with SDR1.5371 billion, equivalent to 475 percent of its quota, to support an economic and financial reform programme covering 2026-29.

The agreement, reached after an IMF staff mission led by Mercedes Vera Martin held discussions with Senegalese authorities in Dakar from August 19 to September 1, must still be approved by IMF management and the Executive Board. Senegal must also take decisive corrective measures to support its request for a waiver related to the misreporting case and secure financing assurances from its development partners.

The proposed IMF programme is expected to help mobilise additional funding from the World Bank, the African Development Bank and other development partners.

Senegal’s economy grew 6.7 percent in 2025 as oil production entered its first full year of operation, although growth excluding hydrocarbons slowed to 2.2 percent. Inflation stood at 1.4 percent, within the country’s target range.

Non-hydrocarbon growth recovered to 4.7 percent year-on-year in the first quarter of 2026, supported by stronger private consumption, according to the IMF.

The programme will focus on improving Senegal’s public finances while protecting vulnerable households. The fiscal strategy includes increasing domestic revenue mobilisation, streamlining public expenditure and strengthening targeted cash-transfer programmes.

Senegal plans to adopt a medium-term revenue strategy in 2027 as part of efforts to increase domestic revenue and create room for priority spending. The authorities also intend to strengthen public debt management, improve monitoring of domestic arrears and tighten oversight of state-owned enterprises.

The IMF said reforms aimed at improving the business environment and expanding financial inclusion would support private-sector-led growth. Senegal has also announced plans to seek debt treatment as it works to restore debt sustainability.

The proposed programme follows concerns over financial reporting under the previous administration. The IMF said continued action would be necessary to resolve the misreporting issues and strengthen safeguards against similar problems in the future.

Source: FSX Business News