Senegal Gains IMF Praise for Debt Management Reforms
The International Monetary Fund (IMF) mission to Senegal concluded with recognition of the country’s recent progress in tackling fiscal challenges and improving transparency. The visit highlighted major actions addressing hidden debt issues and efforts to mobilize revenue through diversified taxation.
“The IMF and the Senegalese authorities agreed on the need for sustained reforms to support fiscal consolidation conducive to growth and to advance governance and anti-corruption measures.”
The IMF noted that Senegal’s government made “notable progress” in implementing corrective measures related to hidden debt, particularly in public debt disclosure and management practices. The reforms aim to enhance budget transparency and promote responsible fiscal policies.
Revenue Mobilisation Strategy
Authorities have pursued an ambitious revenue mobilisation agenda involving new taxes on gambling, mobile money transactions, and land-related operations. The gradual removal of several tax exemptions supports broader fiscal consolidation, with a focus on maintaining budget discipline.
Risks and Debt Concerns
“The very high tax revenue expected from the announced measures constitutes a significant risk,” the IMF cautioned, urging the adoption of more conservative assumptions.
Despite encouraging progress, public debt continues to be a concern. Around 4 percent of domestic arrears remain unpaid, pending results from the General Inspectorate of Finance (IGF) audit. Senegalese authorities are actively managing debt to mitigate vulnerabilities and maintain economic stability.
Summary
IMF commends Senegal’s strides in fiscal reform and transparency but advises caution as ambitious revenue goals and debt levels pose ongoing risks.
Author’s summary: Senegal’s IMF-reviewed fiscal reforms show solid progress in transparency and tax policy, though debt risks and ambitious revenue forecasts require careful management.
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