Senegal’s Minister of Economy, Abdourahamne Sarr, declared the nation’s debt sustainable despite an increasing debt ratio. Projected economic growth is 6.5% in the coming years, attributed to oil and gas production. A joint analysis reveals the country faces moderate over-indebtedness risk, but fiscal adjustments and a new debt strategy are in place to ensure stability.
Abdourahamne Sarr, Senegal’s Minister of Economy and Planning, affirmed that the country’s debt remains sustainable despite a rising debt ratio. Speaking at a government press conference, he cited internal analyses indicating robust economic growth, projected at an average of 6.5% in the coming years, particularly due to the onset of oil and gas production, which supports the debt trajectory for 2025-2029.
The Minister referenced a joint debt sustainability analysis by the IMF and World Bank from June 2023, which confirmed that Senegal faces a moderate risk of over-indebtedness. He stated, “Our internal analyses show that Senegal’s debt is still sustainable,” even while acknowledging the significant increase in the debt ratio.
To address the rising debt, Sarr emphasized a strategic fiscal adjustment aimed at stabilizing the debt ratio. He noted that the country exhibits a favorable debt structure, with an average interest rate of 4.6% against a projected growth rate of 6.5%, ensuring manageable debt levels.
Additionally, Sarr detailed a new debt strategy focused on reducing dependency on foreign currency debt to enhance long-term sustainability. This strategy aims to ensure economic stability while promoting prudent management of public finances, crucial for maintaining Senegal’s financial health.
In summary, Minister Abdourahamne Sarr maintains that Senegal’s debt is sustainable, bolstered by anticipated economic growth driven by oil and gas production. The government is committed to addressing rising debt through strategic fiscal adjustments and improved debt management policies, aiming for long-term financial stability.
Original Source: www.senenews.com
