(Ecofin Agency) - In September 2024, Senegal’s new leadership uncovered a troubling reality about the nation’s finances, with debt and deficits far exceeding the figures claimed by the previous administration. Now, all eyes are on the government as creditors await its next moves.

Senegal is exploring several options to manage its debt but has no plans to renegotiate or restructure it, according to the Ministry of Finance. This statement comes in response to a Bloomberg report suggesting the possibility of extending repayment deadlines for Senegal's debt.

The ministry emphasized its goal of taking a proactive and strategic approach to public debt management. The aim is to optimize repayment schedules while honoring commitments to investors. The government also plans to adjust its international market issuances to ease debt servicing, particularly in 2026 and 2027. As part of this strategy, Senegal intends to issue bonds to raise CFA1,500 billion ($2.4 billion), reducing reliance on external financing.

These plans come as an audit conducted by the new administration reveals the true scale of Senegal’s debt. According to Prime Minister Ousmane Sonko, the country’s debt amounts to over 83% of GDP, much higher than the previously reported 73%. The budget deficit averaged 10.4% of GDP from 2019 to 2023, nearly double the 5.5% figure reported by the administration of former President Macky Sall.

While the government awaits the final results of the audit in a report by the Court of Auditors, Senegal is already facing challenges. The country has yet to secure $1.8 billion in expected funds from the IMF, and in October, Moody’s downgraded Senegal’s credit rating. The downgrade was attributed to the worsening fiscal and debt situation.