Senegal’s hopes for an IMF loan disbursement have been delayed until at least June 2024. The delay stems from a government audit that uncovered larger-than-expected debt and deficit figures than previously reported.
The International Monetary Fund (IMF) will not consider Senegal’s request for a new program until the audit findings are certified and reviewed by the Fund’s executive board, a process expected to take six months.
The IMF’s decision is a significant setback for Senegal, which is facing a precarious fiscal situation.
The country had already been grappling with slower-than-projected growth and a worsening budget deficit before the revelations about the larger debt and deficit figures.
The misreporting has raised concerns among investors about Senegal’s debt sustainability.
The yield on the country’s 2048 bond has risen above 10%, indicating increased risk.
Senegal’s government is seeking to implement economic reforms, including a new budget law and the abolition of wasteful state bodies.
However, the delay in IMF funding could hinder these efforts.