Senegal is facing a significant financial crisis due to the discovery of billions of dollars in hidden debt, severely impacting its plans for infrastructure development. A Court of Auditors review in February 2025 revealed that the total national debt at the end of 2023 was 99.7% of GDP, a stark increase from the previously reported 74.41%. This meant approximately $7 billion in hidden borrowing. S&P Global Ratings later downgraded Senegal's long-term sovereign rating to "B-" in July 2025, estimating hidden debts at around $13 billion and pushing the debt-to-GDP ratio to 118%.
The revelation of this undisclosed borrowing has stalled negotiations with the International Monetary Fund (IMF) for a new program, which is critical for financing Senegal's recovery and regaining investor confidence. The IMF froze Senegal's three-year, $1.8 billion credit facility agreed upon in June 2023 and stated in March 2025 that new program talks could not proceed until the debt misreporting was addressed. While the IMF is unlikely to demand repayment from Senegal, given the current government's transparency, the delay in securing a new program has severely restricted the country's access to funds and international bond markets.
Prime Minister Ousmane Sonko, appointed in May 2026, has taken steps to address the crisis, including presenting an economic recovery plan in August 2025 that aims to fund 90% of its initiatives from domestic resources and avoid new external debt. His government has ordered audits, with an audit in September 2024 revealing the end-2023 budget deficit was over 10%, significantly wider than the 5% previously reported. However, ongoing financial pressures, including a potential $2 billion overrun in fuel subsidies for 2026, continue to challenge the nation's stability, raising questions about Senegal's ability to finance its infrastructure dreams and maintain economic growth.
