Senegal is facing a sharp increase in its 2026 debt-service obligations—up 11% higher than previously estimated—after the government uncovered billions of dollars in undisclosed liabilities from the past administration.
According to new budget documents released by the Finance Ministry, debt servicing costs are now projected at 5.49 trillion CFA francs ($9.7 billion) for 2026, compared to the earlier estimate of 4.95 trillion CFA francs.
Over the next three years, total debt service is expected to reach 14.9 trillion CFA francs, a figure more than four times earlier projections, according to Bloomberg.
The significant adjustment follows a financial audit ordered by President Bassirou Diomaye Faye’s administration, which uncovered around $7 billion in hidden borrowing by the former government.
In response to this revelation, the International Monetary Fund (IMF) has suspended its $1.8 billion support program for Senegal.
The discovery has worsened Senegal’s financial standing internationally. Both S&P Global Ratings and Moody’s downgraded the country’s sovereign credit to junk status, complicating future borrowing efforts.
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More than 40% of Senegal’s public debt is currently denominated in foreign currencies, according to S&P. The government expects its debt-to-GDP ratio to stabilize around 101% by 2028, based on its medium-term debt management strategy.
The IMF further estimates that Senegal’s total liabilities, including those from state-owned enterprises, climbed to 132% of GDP by the end of 2024. When those entities are excluded, government figures place the total at 119%.
In a bid to restore fiscal stability and rebuild investor confidence, Senegal plans to mobilize nearly $10 billion over the next three years.
The government intends to achieve this through a mix of tax increases, renegotiated energy contracts, and public spending cuts, as outlined in its August 2025 fiscal reform plan.
Despite the financial turmoil, the country’s economy remains on a growth path. Senegal’s economic growth is projected to reach 7.8% in 2025, driven by new oil and gas projects, and to average 5.5% annually between 2026 and 2028.
However, the fiscal deficit is expected to rise slightly to 5.4% of GDP next year—above the initial 5% target.
This fiscal shake-up marks one of the most significant financial crises for Senegal in recent years, highlighting the lasting impact of opaque governance on the nation’s economic resilience.
