Senegal is set to access a new Sh284 billion IMF programme after years of financial uncertainty forced the country to seek fresh support from the lender.
The International Monetary Fund has reached a staff-level agreement with Senegal for a $2.2 billion loan package that will run for 36 months and support the country’s economic and financial reform plans for the 2026–2029 period.
The agreement marks a new phase in relations between Senegal and the IMF after the lender suspended an earlier $1.8 billion programme in 2024.
That programme, which had been agreed in 2023, was put on hold after the discovery of debt that had not been included in the country's earlier financial reports.
The new deal will, however, come with conditions linked to the earlier financial reporting problems.
The IMF said Senegal would have to take "decisive corrective measures to support the authorities' request for a waiver regarding the misreporting of data".
The agreement reached between IMF staff and the Senegalese authorities is still subject to approval by the IMF executive board.
The financial problems came into sharper focus after the government that took office in 2024 accused the administration of former president Macky Sall of failing to disclose the full extent of Senegal's financial difficulties.
Sall served as president from 2012 to 2024 before an opposition-backed government took power.
An assessment by the IMF later showed that Senegal's 2023 budget deficit was far higher than the figure previously reported by the former government.
The IMF put the deficit at 12.3 percent of GDP, compared with 4.9 percent reported at the time by the previous administration.
The revelations triggered a suspension of the IMF's earlier financing arrangement and forced Senegal's new authorities to provide more information about the country's financial position.
The IMF subsequently sent several missions to Senegal to assess the situation before negotiations on a replacement programme began in mid-October.
The new financing comes at a time when Senegal is carrying a heavy debt burden.
The IMF estimates that total public sector debt reached 132 percent of GDP by the end of 2024, placing Senegal among the most heavily indebted countries in sub-Saharan Africa.
Despite the high debt level, the country's fiscal position improved in 2025.
The overall fiscal deficit dropped from 13.4 percent of GDP in 2024 to 6.4 percent in 2025, with the IMF attributing much of the improvement to efforts to control government spending.
Senegal has largely relied on the regional bond market to meet its financing needs since access to other sources of funding became more difficult.
However, borrowing through the regional market is more expensive than financing obtained from international financial institutions, development banks and governments, according to S&P.
The IMF agreement also comes against the backdrop of political differences within Senegal's leadership.
President Bassirou Diomaye Faye and his former prime minister, Ousmane Sonko, became involved in a political dispute earlier this year, with the IMF programme among the issues at the centre of their differences.
Faye removed Sonko as prime minister in May, but Sonko later became speaker of the National Assembly.
His new position could make it more difficult for the president to secure support for reforms required under the IMF programme.
Faye has favoured a more cooperative relationship with the IMF, while Sonko has opposed debt restructuring.
Senegal also faced a fresh blow from international credit markets last week when Moody's lowered its long-term foreign-currency debt rating from Caa1 to Caa2.
The downgrade came while the government was negotiating the new IMF programme, adding to the financial pressure facing the West African country.