DAKAR - How ought a country cope with colossal debt? As Africa hosts its first G20 summit in Johannesburg on Saturday with debt among the top topics, Senegal is battling to secure a new aid programme from the IMF.
The heavily indebted west African nation is aiming to ease its financial burden and restore its economic partners' confidence with the move.
With a total public sector debt estimated at 132 percent of GDP by the International Monetary Fund (IMF), Senegal is now the second most indebted country in sub-Saharan Africa.
In 2024, Senegal's current government, formed after an opposition electoral victory, accused the former administration of ex-president Macky Sall (2012-2024) of having concealed the true extent of the country's worrisome budgetary situation.
As a result, the IMF suspended a $1.8 billion aid programme it had agreed upon in 2023, pending further information and commitments from Senegal's new authorities.
It pointed to what it said had been significantly misleading statements by the previous administration regarding budget deficits and public debt for the 2019-2023 period.
After several IMF visits to Senegal to examine the country's financial situation, the IMF and the government began negotiations in mid-October for a new aid programme.
The sides have still not reached an agreement, which is not unusual at this stage in the talks.
Restructuring would allow Senegal to alter its loan terms through various means such as increasing its repayment term or cancelling part of the interest or debt.
In an interview, IMF mission chief Edward Gemayel acknowledged "very, very intense discussions" with the government.
But he praised the country's "resilient" economy and reiterated that "there is no default (on payments) at the moment".
