EXECUTIVE SUMMARY
SENEGAL : FY 2023 FINANCE ACT
Senegal has accustomed us to posting very high growth rates which find origin in a diversified economy. In a crisis period, Senegal has shown strong resilience, and is one of the few economies to maintain a positive growth rate. With the advent of the start of energy production planned for Q4-2023, GDP growth is regaining new vivacity and should record a growth of almost 10%. The oil impact should still be effective in 2024, when the mentioned growth rate would be maintained.
While the start of oil production should have a significant impact on 2023E growth, its effect on public revenue would be less pronounced. At any rate, the Treasury forecasts a net increase in expenses to the benefit of social sectors, in particular employment and subsidies. In return, the State intends to slow down the pace of public investment and plans to gradually hand over to private operators who can capitalize on previous public achievements as well as on the improvement of the business environment.
The result of this budgetary structure would be a stable budget balance, and accordingly a fiscal deficit (in % of GDP) diluted by a double effect of strong growth and high inflation. Finally, it is certain that public indebtedness in Senegal is growing, without this giving rise to any real concern. The advantages of this economy take precedence over risk apprehensions related to “emerging” countries debt. In this context, external financing could be combined with the
regional debt market which is gaining depth.
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