Abstract
This paper discusses Senegal's Request for a Three-Year Policy Support Instrument (PSI). Performance under the two previous PSIs was mixed. The new PSI aims to support a three-year program of macroeconomic reforms designed to advance the authorities' growth strategy-Plan Senegal Emergent (PSE). The growth goals enshrined in the PSE are achievable provided reforms are successfully implemented. Early signs indicate positive momentum owing to observed progress in reform implementation and favorable external factors. However, more remains to be done to solidify this momentum. Also, there are significant but manageable risks, which include sluggish implementation of reforms and election-driven pressures in 2016 and 2017. The IMF staff supports the authorities' request for a PSI.
Background
1. Senegal’s total public debt and external debt ratios both increased in 2014. The ratio of the total public debt to GDP ratio amounted to about 53.1 percent at end 2014, up from 46.6 percent in 2013. At the same time, the stock of total external public and publicly guaranteed debt has increased from 32.4 percent in 2013 to about 39.4 percent at end 2014. These developments mainly reflect the authorities’ increasing reliance on external non-concessional or semi-concessional borrowing to finance projects.
Senegal: Total External Debt, Central Government
(Percent of total, as of end of year)
Senegal: Total External Debt, Central Government
(Percent of total, as of end of year)
| 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | ||
|---|---|---|---|---|---|---|---|---|
| Total | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | |
| Multilateral creditors | 61.2 | 65.1 | 66.4 | 62.3 | 62.1 | 63.7 | 54.4 | |
| IDA/IBRD | 35.6 | 29.7 | 29.2 | 30.5 | 30.2 | 29.6 | 26.8 | |
| AfDB/AfDF | 7.6 | 8.3 | 9.0 | 9.9 | 9.8 | 11.0 | 9.5 | |
| IMF | 2.6 | 6.8 | 10.8 | 5.3 | 6.1 | 7.4 | 5.1 | |
| OFID/BADEA/IsDB | 8.6 | 11.9 | 10.1 | 9.7 | 8.4 | 8.0 | 6.7 | |
| EIB | 0.9 | 1.0 | 1.0 | 0.9 | 0.8 | 0.8 | 0.5 | |
| Others | 5.9 | 7.4 | 6.4 | 6.0 | 6.9 | 6.8 | 5.8 | |
| Bilateral creditors | 38.7 | 29.3 | 27.8 | 24.9 | 26.5 | 26.2 | 25.6 | |
| OECD countries | 11.2 | 10.2 | 9.7 | 7.3 | 10.4 | 10.1 | 11.8 | |
| Arab countries | 21.2 | 14.1 | 10.3 | 7.7 | 6.9 | 6.1 | 5.7 | |
| Others | 6.3 | 5.0 | 7.8 | 9.9 | 9.1 | 10.0 | 8.0 | |
| Commercial creditors | 0.1 | 5.6 | 5.8 | 12.8 | 11.4 | 10.1 | 20.0 | |
| Memorandum Item | ||||||||
| Nominal GDP (CFAF billions) | 5994 | 6050 | 6395 | 6783 | 7264 | 7387 | 7742 | |
Senegal: Total External Debt, Central Government
(Percent of total, as of end of year)
| 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | ||
|---|---|---|---|---|---|---|---|---|
| Total | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | |
| Multilateral creditors | 61.2 | 65.1 | 66.4 | 62.3 | 62.1 | 63.7 | 54.4 | |
| IDA/IBRD | 35.6 | 29.7 | 29.2 | 30.5 | 30.2 | 29.6 | 26.8 | |
| AfDB/AfDF | 7.6 | 8.3 | 9.0 | 9.9 | 9.8 | 11.0 | 9.5 | |
| IMF | 2.6 | 6.8 | 10.8 | 5.3 | 6.1 | 7.4 | 5.1 | |
| OFID/BADEA/IsDB | 8.6 | 11.9 | 10.1 | 9.7 | 8.4 | 8.0 | 6.7 | |
| EIB | 0.9 | 1.0 | 1.0 | 0.9 | 0.8 | 0.8 | 0.5 | |
| Others | 5.9 | 7.4 | 6.4 | 6.0 | 6.9 | 6.8 | 5.8 | |
| Bilateral creditors | 38.7 | 29.3 | 27.8 | 24.9 | 26.5 | 26.2 | 25.6 | |
| OECD countries | 11.2 | 10.2 | 9.7 | 7.3 | 10.4 | 10.1 | 11.8 | |
| Arab countries | 21.2 | 14.1 | 10.3 | 7.7 | 6.9 | 6.1 | 5.7 | |
| Others | 6.3 | 5.0 | 7.8 | 9.9 | 9.1 | 10.0 | 8.0 | |
| Commercial creditors | 0.1 | 5.6 | 5.8 | 12.8 | 11.4 | 10.1 | 20.0 | |
| Memorandum Item | ||||||||
| Nominal GDP (CFAF billions) | 5994 | 6050 | 6395 | 6783 | 7264 | 7387 | 7742 | |
2. In terms of composition, the bulk of Senegal’s debt remains external and provided on concessional terms, but the share of financial market instruments—specifically, Eurobonds—has increased in 2014. This reflected the use of a Credit Suisse line of credit (Euro 150 millions) and the issuance of a US$500 million Eurobond in July 2014. Although most of Senegal’s (central government) external debt is still owed to multilateral creditors – primarily the World Bank and the African Development Bank -, the proportion of multilateral debt decreased in 2014, while that of bilateral debt remained broadly stable. The increase in gross public debt also overstates somewhat the increase in net debt. Market requirements generally require operations of at least US$500 million, and the government has also over-financed on the regional market. This, together with delays in implementing projects, has resulted in only part of the Credit Suisse and Eurobond actually being spent. The equivalent of about $550 million has been built up in Government deposits at the Central Bank. Netting this out, public debt would only have risen from 46.6 percent of GDP in 2013 to 49.6 percent in 2014.
Underlying Assumptions and Borrowing Plan
3. The DSA is consistent with the macroeconomic framework outlined in the staff report and updates the government borrowing plan produced in EBS/14/139 in December 2014 for the 2014 Article IV consultation and Eight Review under Policy Support Instrument (PSI). As in the previous DSA, the baseline scenario assumes the implementation of sound macroeconomic policies and structural reforms, leading to an increase in economic growth, a better revenue mobilization and a narrowing of fiscal deficits over the long term. Other notable features include:
Real GDP growth is expected to increase to above 5 percent in 2015 and to accelerate to 7.8 percent on average in 2020–34, compared to 7.3 percent long-term growth in the previous DSA. This continues to assume efficiency gains from reform implementation under the Plan Senegal Emergent (PSE)1 and an opening of economic space to SMEs and FDI with a resultant increase in export growth.
Fiscal deficit. The overall fiscal deficit is projected to decline to 4.7 percent of GDP in 2015 and gradually drop to 3 percent of GDP by 2018 in line with the authorities’ commitment to meet the key WAEMU convergence criterion on the fiscal deficit, which they aim to reach one year ahead of the 2019 deadline.
Current account deficit. The current account deficit is projected to narrow gradually from 8.8 percent of GDP in 2014 to 6.4 percent in 2020 and further down in the long term. This would be driven by projected fiscal consolidation and stronger dynamism in exports (mining in particular). Remittances are projected to remain significant as a share of GDP.
Inflation. Inflation is expected to remain moderate, on average less than 1.3 percent in the medium term.
Financing. Under this DSA update, financing assumptions take into account the costs and benefits of alternative sources, and it is assumed that government borrowing will remain consistent with Senegal’s medium term debt strategy completed in the fall of 2012. This strategy aims at reducing rollover risks by extending the maturity of debt and giving priority to concessional financing to keep borrowing costs low. Where the government needs to resort to non-concessional financing of infrastructure projects, their preferred option is to explore access to financing from multilaterals, notably the World Bank and African Development Bank. The DSA baseline assumes that financing on such terms would be available. If such financing is not available, the authorities would consider issuing a new Eurobond in late-2015 or early-2016. While this would result in less favorable terms than multilateral financing, it would not affect the calculated low risk of external debt distress. The authorities intend to monitor closely the relative benefits of tapping regional markets, particularly if conditions on international markets tighten. The DSA baseline also assumes that mobilizing concessional project financing would continue, specifically, in the short term as the PSE benefits from donor support. However, as Senegal progresses to middle income status, reliance on non-concessional financing will increase. As a result, the average grant element of new external borrowing is projected to decline gradually to about 9 percent.
Discount rate: A discount rate of 5 percent has been used for this DSA.
Evolution of Selected Marroeconomk Indicators
Defined as the last 15 years of the projection period. For the current DSA update, the long term covers the years 2020-2034 (same as the full DSA in December 2014).
Evolution of Selected Marroeconomk Indicators
| 2012 | 2013 | 2014 | 2015 | Long term 1/ | ||
|---|---|---|---|---|---|---|
| Real GDP growth | ||||||
| Current DSA | 4.4 | 3.6 | 4.7 | 5.1 | 7.8 | |
| Previous DSA | 3.4 | 3.5 | 4.5 | 4.6 | 7.3 | |
| Overall fiscal deficit (percent of GDP) | ||||||
| Current DSA | 5.2 | 5.5 | 4.9 | 4.7 | 2.6 | |
| Previous DSA | 5.9 | 5.5 | 5.2 | 4.7 | 2.6 | |
| Current account deficit (percent of GDP) | ||||||
| Current DSA | 10.9 | 10.4 | 8.8 | 8.0 | 6.1 | |
| Previous DSA | 10.8 | 10.9 | 10.3 | 8.8 | 7.5 | |
Defined as the last 15 years of the projection period. For the current DSA update, the long term covers the years 2020-2034 (same as the full DSA in December 2014).
Evolution of Selected Marroeconomk Indicators
| 2012 | 2013 | 2014 | 2015 | Long term 1/ | ||
|---|---|---|---|---|---|---|
| Real GDP growth | ||||||
| Current DSA | 4.4 | 3.6 | 4.7 | 5.1 | 7.8 | |
| Previous DSA | 3.4 | 3.5 | 4.5 | 4.6 | 7.3 | |
| Overall fiscal deficit (percent of GDP) | ||||||
| Current DSA | 5.2 | 5.5 | 4.9 | 4.7 | 2.6 | |
| Previous DSA | 5.9 | 5.5 | 5.2 | 4.7 | 2.6 | |
| Current account deficit (percent of GDP) | ||||||
| Current DSA | 10.9 | 10.4 | 8.8 | 8.0 | 6.1 | |
| Previous DSA | 10.8 | 10.9 | 10.3 | 8.8 | 7.5 | |
Defined as the last 15 years of the projection period. For the current DSA update, the long term covers the years 2020-2034 (same as the full DSA in December 2014).
External DSA
4. Under the baseline scenario (Figure 1), and taking remittances into account, public and publicly guaranteed (PPG) external debt ratios remain comfortably below thresholds, but stress tests lead to some spikes. The ratios of the PV of external PPG debt remain below their respective thresholds even under the most extreme stress tests. One spike in debt service reflects the repayment of the Eurobonds at maturity, but it does not lead to a breach of the threshold even under the most extreme stress test (a 30 percent depreciation of the currency). The PV of external PPG debt under the “historical” scenario (holding real GDP growth and the primary deficit constant at their historical levels), though below thresholds, bumps up after 2025, which underscores the importance of continuing the fiscal effort—that improves the current account - and raising growth.
Senegal: Indicators of Public and Publicly Guaranteed External Debt under Alternatives Scenarios, 2015–35 1/
Citation: IMF Staff Country Reports 2015, 273; 10.5089/9781513518947.002.A002
Sources: Country authorities; and staff estimates and projections.1/ The most extreme stress test is the test that yields the highest ratio on or before 2025. In figure b. it corresponds to a Combination shock; in c. to a Combination shock; in d. to a Combination shock; in e. to a Growth shock and in figure f. to a Growth shockSenegal: Indicators of Public and Publicly Guaranteed External Debt under Alternatives Scenarios, 2015–35 1/
Citation: IMF Staff Country Reports 2015, 273; 10.5089/9781513518947.002.A002
Sources: Country authorities; and staff estimates and projections.1/ The most extreme stress test is the test that yields the highest ratio on or before 2025. In figure b. it corresponds to a Combination shock; in c. to a Combination shock; in d. to a Combination shock; in e. to a Growth shock and in figure f. to a Growth shockSenegal: Indicators of Public and Publicly Guaranteed External Debt under Alternatives Scenarios, 2015–35 1/
Citation: IMF Staff Country Reports 2015, 273; 10.5089/9781513518947.002.A002
Sources: Country authorities; and staff estimates and projections.1/ The most extreme stress test is the test that yields the highest ratio on or before 2025. In figure b. it corresponds to a Combination shock; in c. to a Combination shock; in d. to a Combination shock; in e. to a Growth shock and in figure f. to a Growth shock5. The probability of debt distress also appears to be low (Figure 2). Under the extreme shock scenario, the debt service-to-revenue tends to breach for 2015, given the significant depreciation of the CFAF relatively to the US dollar. As the breach falls within a ±10 percent band of threshold, the probability approach is taken; this confirms that the debt service remains below thresholds under the baseline and extreme scenarios. Other indicators for Senegal also remain below the thresholds in all cases. The requirements for low risk of debt distress are, accordingly, maintained. The depreciation of the CFAF, induces valuation effects which need to be looked at more closely going forward. Under the probability approach, the projected probability of debt distress (expressed as a percent) associated with each debt burden indicator is compared to a threshold level, which is different from the threshold used in the traditional approach.
Senegal: Probability of Debt Distress of Public and Publicly Guaranteed External Debt under Alternatives Scenarios, 2015–35 1/
(In percent)
Citation: IMF Staff Country Reports 2015, 273; 10.5089/9781513518947.002.A002
Sources: Country authorities; and staff estimates and projections.1/ The most extreme stress test is the test that yields the highest ratio on or before 2025. In figure b. it corresponds to a Combination shock; in c. to a Combination shock; in d. to a Combination shock; in e. to a Growth shock and in figure f. to a Growth shockSenegal: Probability of Debt Distress of Public and Publicly Guaranteed External Debt under Alternatives Scenarios, 2015–35 1/
(In percent)
Citation: IMF Staff Country Reports 2015, 273; 10.5089/9781513518947.002.A002
Sources: Country authorities; and staff estimates and projections.1/ The most extreme stress test is the test that yields the highest ratio on or before 2025. In figure b. it corresponds to a Combination shock; in c. to a Combination shock; in d. to a Combination shock; in e. to a Growth shock and in figure f. to a Growth shockSenegal: Probability of Debt Distress of Public and Publicly Guaranteed External Debt under Alternatives Scenarios, 2015–35 1/
(In percent)
Citation: IMF Staff Country Reports 2015, 273; 10.5089/9781513518947.002.A002
Sources: Country authorities; and staff estimates and projections.1/ The most extreme stress test is the test that yields the highest ratio on or before 2025. In figure b. it corresponds to a Combination shock; in c. to a Combination shock; in d. to a Combination shock; in e. to a Growth shock and in figure f. to a Growth shockPublic DSA
6. Under the PSI baseline scenario, indicators of overall public debt (external plus domestic) do not show significant vulnerabilities. The PV of total public debt to GDP decreases over the projection period and remains well below the benchmark level of 74 percent associated with public debt vulnerabilities for strong performers. The PV of total public debt to revenue also remains below benchmark. Similar to the previous DSA, the thresholds for PPG external debt reflect Senegal’s new CPIA score – which classified Senegal as a stronger performer - and designate levels above which the risk of public debt distress is heightened. The benchmarks are in PV terms. Benchmarks for total public debt differ from thresholds for PPG external debt in that they serve as reference points for triggering a deeper discussion of public domestic debt. Thresholds for PPG external debt play a fundamental role in the determination of the external risk rating.
7. The public debt outlook would be much less favorable in the absence of fiscal consolidation (Table 4 and Figure 3). In a scenario that assumes an unchanged primary fiscal deficit (as a percent of GDP) over the entire projection period, the PV of public debt to GDP slightly increases but does not reach the 74 percent benchmark level. Under the “historical” scenario (holding real GDP growth and the primary deficit constant at their historical levels), the PV of public debt to GDP approaches the benchmark level closely. The debt service-to-revenue ratio spikes in 2015 due to high amortization but declines in the medium term given the projected improvement in Government revenue. Overall risks remain low but stress tests highlight the importance of continuing the fiscal consolidation, enhancing fiscal revenues, and raising growth through a widening, deepening and acceleration of reforms.
Senegal: Public Sector Debt Sustainability Framework, Baseline Scenario, 2012–35 1/
(In percent of GDP, unless otherwise indicated)
Includes both public and private sector external debt.
Derived as [r - g - ρ(1+g)]/(1+g+ρ+gρ) times previous period debt ratio, with r = nominal interest rate; g = real GDP growth rate, and ρ = growth rate of GDP deflator in U.S. dollar terms.
Includes exceptional financing (i.e., changes in arrears and debt relief); changes in gross foreign assets; and valuation adjustments. For projections also includes contribution from price and exchange rate changes.
Assumes that PV of private sector debt is equivalent to its face value.
Current-year interest payments divided by previous period debt stock.
Historical averages and standard deviations are generally derived over the past 10 years, subject to data availability.
Defined as grants, concessional loans, and debt relief.
Grant-equivalent financing includes grants provided directly to the government and through new borrowing (difference between the face value and the PV of new debt).
Senegal: Public Sector Debt Sustainability Framework, Baseline Scenario, 2012–35 1/
(In percent of GDP, unless otherwise indicated)
| Actual | Historical Average6/ | Standard Deviation6/ | Projections | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2015-2020 Average | 2025 | 2035 | 2021-2035 Average | |||||||
| External debt (nominal) 1/ | 60.8 | 68.2 | 71.1 | 71.7 | 71.3 | 70.1 | 68.4 | 65.4 | 64.3 | 58.4 | 51.7 | ||||||||
| of which: public and publicly guaranteed (PPG) | 30.6 | 32.4 | 39.4 | 35.7 | 37.7 | 37.5 | 36.6 | 35.6 | 34.6 | 30.8 | 20.1 | ||||||||
| Change in external debt | 6.3 | 7.4 | 2.9 | 0.6 | −0.4 | −1.2 | −1.7 | −3.0 | −1.1 | −1.7 | 2.1 | ||||||||
| Identified net debt-creating flows | 9.9 | 5.6 | 3.6 | 1.8 | 1.2 | 0.5 | 0.1 | −0.2 | 0.0 | 0.1 | 0.6 | ||||||||
| Non-interest current account deficit | 9.9 | 9.4 | 7.9 | 8.3 | 2.8 | 7.3 | 6.4 | 6.2 | 6.0 | 5.8 | 5.9 | 5.9 | 6.1 | 5.9 | |||||
| Deficit in balance of goods and services | 21.0 | 20.7 | 19.0 | 19.0 | 18.3 | 18.3 | 17.9 | 17.5 | 16.2 | 12.9 | 12.0 | ||||||||
| Exports | 27.9 | 28.1 | 27.4 | 26.4 | 25.5 | 25.5 | 25.5 | 25.2 | 25.2 | 22.7 | 20.3 | ||||||||
| Imports | 48.9 | 48.8 | 46.3 | 45.3 | 43.8 | 43.8 | 43.3 | 42.7 | 41.4 | 35.6 | 32.3 | ||||||||
| Net current transfers (negative = inflow) | −12.3 | −12.5 | −12.4 | −11.4 | 1.5 | −13.0 | −13.1 | −12.9 | −12.7 | −12.3 | −11.2 | −7.4 | −6.2 | −7.4 | |||||
| of which: official | −1.0 | −0.6 | −0.7 | −1.0 | −1.2 | −1.2 | −1.2 | −1.1 | −0.9 | −0.7 | −0.5 | ||||||||
| Other current account flows (negative = net inflow) | 1.3 | 1.2 | 1.3 | 1.3 | 1.2 | 0.9 | 0.8 | 0.6 | 0.8 | 0.5 | 0.3 | ||||||||
| Net FDI (negative = inflow) | −1.5 | −1.9 | −2.0 | −1.9 | 0.5 | −2.1 | −2.1 | −2.2 | −2.3 | −2.3 | −2.3 | −2.3 | −2.3 | −2.3 | |||||
| Endogenous debt dynamics 2/ | 1.5 | −2.0 | −2.3 | −3.4 | −3.1 | −3.5 | −3.7 | −3.7 | −3.5 | −3.4 | −3.2 | ||||||||
| Contribution from nominal interest rate | 1.0 | 0.9 | 0.9 | 0.8 | 0.7 | 0.7 | 0.8 | 0.8 | 0.8 | 0.7 | 0.5 | ||||||||
| Contribution from real GDP growth | −2.4 | −2.1 | −3.1 | −4.1 | −3.8 | −4.2 | −4.4 | −4.5 | −4.3 | −4.1 | −3.7 | ||||||||
| Contribution from price and exchange rate changes | 3.0 | −0.8 | −0.1 | … | … | … | … | … | … | … | … | ||||||||
| Residual (3-4) 3/ | −3.6 | 1.8 | −0.7 | −1.3 | −1.6 | −1.8 | −1.7 | −2.8 | −1.1 | −1.8 | 1.5 | ||||||||
| of which: exceptional financing | −1.4 | −0.1 | 1.5 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||
| PV of external debt 4/ | … | … | 54.8 | 60.5 | 58.8 | 58.2 | 57.2 | 54.8 | 54.2 | 51.0 | 47.5 | ||||||||
| In percent of exports | … | … | 200.3 | 229.6 | 231.0 | 227.9 | 224.7 | 217.7 | 214.9 | 224.7 | 233.7 | ||||||||
| PV of PPG external debt | … | … | 23.1 | 24.6 | 25.3 | 25.6 | 25.4 | 25.0 | 24.4 | 23.3 | 15.9 | ||||||||
| In percent of exports | … | … | 84.3 | 93.2 | 99.2 | 100.2 | 99.7 | 99.2 | 96.9 | 102.8 | 78.3 | ||||||||
| In percent of government revenues | … | … | 110.0 | 114.9 | 118.9 | 121.1 | 119.4 | 116.5 | 113.5 | 111.7 | 76.3 | ||||||||
| Total gross financing need (Billions of U.S. dollars) | 1.6 | 1.5 | 1.5 | 1.6 | 1.1 | 1.0 | 1.1 | 1.2 | 1.3 | 2.3 | 5.4 | ||||||||
| Non-interest current account deficit that stabilizes debt ratio | 3.6 | 2.1 | 4.9 | 6.7 | 6.8 | 7.5 | 7.7 | 8.8 | 7.0 | 7.6 | 4.0 | ||||||||
| Key macroeconomic assumptions | |||||||||||||||||||
| Real GDP growth (in percent) | 4.4 | 3.6 | 4.7 | 3.8 | 1.2 | 5.1 | 5.9 | 6.5 | 7.0 | 7.3 | 7.3 | 6.5 | 7.6 | 8.2 | 7.8 | ||||
| GDP deflator in US dollar terms (change in percent) | −5.2 | 1.4 | 0.2 | 3.3 | 7.7 | −16.7 | 6.3 | 3.3 | 3.5 | 3.6 | 4.2 | 0.7 | 2.4 | 2.5 | 2.5 | ||||
| Effective interest rate (percent) 5/ | 1.7 | 1.6 | 1.4 | 1.8 | 0.4 | 1.0 | 1.1 | 1.2 | 1.2 | 1.3 | 1.3 | 1.2 | 1.3 | 1.1 | 1.2 | ||||
| Growth of exports of G&S (US dollar terms, in percent) | 4.7 | 6.0 | 2.0 | 7.4 | 10.0 | −15.7 | 8.8 | 10.4 | 10.3 | 9.9 | 11.9 | 5.9 | 9.0 | 10.5 | 8.9 | ||||
| Growth of imports of G&S (US dollar terms, in percent) | 8.2 | 5.0 | −0.5 | 9.9 | 17.3 | −14.4 | 8.7 | 10.2 | 9.4 | 9.5 | 8.5 | 5.3 | 7.9 | 10.5 | 8.6 | ||||
| Grant element of new public sector borrowing (in percent) | … | … | … | … | … | 29.3 | 21.7 | 21.9 | 22.5 | 22.6 | 22.8 | 23.5 | 22.5 | 22.1 | 21.8 | ||||
| Government revenues (excluding grants, in percent of GDP) | 20.5 | 19.9 | 21.0 | 21.4 | 21.2 | 21.1 | 21.3 | 21.4 | 21.5 | 20.9 | 20.8 | 20.8 | |||||||
| Aid flows (in Billions of US dollars) 7/ | 1.0 | 0.8 | 0.7 | 0.4 | 0.5 | 0.5 | 0.6 | 0.6 | 0.6 | 0.9 | 1.3 | ||||||||
| of which: Grants | 0.4 | 0.4 | 0.5 | 0.4 | 0.5 | 0.5 | 0.5 | 0.6 | 0.6 | 0.8 | 1.0 | ||||||||
| of which: Concessional loans | 0.6 | 0.4 | 0.2 | 0.0 | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | 0.3 | ||||||||
| Grant-equivalent financing (in percent of GDP) 8/ | … | … | … | 3.5 | 3.8 | 3.7 | 3.5 | 3.4 | 3.1 | 2.7 | 1.5 | 2.4 | |||||||
| Grant-equivalent financing (in percent of external financing) 8/ | … | … | … | 70.2 | 54.8 | 55.2 | 56.9 | 57.2 | 56.2 | 54.5 | 45.0 | 51.2 | |||||||
| Memorandum items: | |||||||||||||||||||
| Nominal GDP (Billions of US dollars) | 14.2 | 15.0 | 15.7 | 13.7 | 15.5 | 17.0 | 18.8 | 20.9 | 23.4 | 37.8 | 103.6 | ||||||||
| Nominal dollar GDP growth | −1.1 | 5.1 | 4.9 | −12.5 | 12.6 | 10.1 | 10.7 | 11.1 | 11.7 | 7.3 | 10.2 | 10.9 | 10.4 | ||||||
| PV of PPG external debt (in Billions of US dollars) | 3.4 | 3.5 | 3.9 | 4.4 | 4.8 | 5.3 | 5.8 | 8.8 | 16.5 | ||||||||||
| (PVt-PVt-1)/GDPt-1 (in percent) | 1.0 | 3.0 | 3.0 | 2.5 | 2.4 | 2.3 | 2.4 | 1.7 | 1.0 | 1.6 | |||||||||
| Gross workers’ remittances (Billions of US dollars) | 1.9 | 2.1 | 2.1 | 1.9 | 2.2 | 2.3 | 2.5 | 2.7 | 2.8 | 3.0 | 6.9 | ||||||||
| PV of PPG external debt (in percent of GDP + remittances) | … | … | 20.3 | 21.5 | 22.1 | 22.5 | 22.4 | 22.1 | 21.8 | 21.6 | 14.9 | ||||||||
| PV of PPG external debt (in percent of exports + remittances) | … | … | 56.3 | 60.8 | 64.0 | 65.1 | 65.2 | 65.2 | 65.5 | 76.4 | 59.0 | ||||||||
| Debt service of PPG external debt (in percent of exports + remittances) | … | … | 5.4 | 12.8 | 4.2 | 3.2 | 3.5 | 3.2 | 2.9 | 5.8 | 6.2 | ||||||||
Includes both public and private sector external debt.
Derived as [r - g - ρ(1+g)]/(1+g+ρ+gρ) times previous period debt ratio, with r = nominal interest rate; g = real GDP growth rate, and ρ = growth rate of GDP deflator in U.S. dollar terms.
Includes exceptional financing (i.e., changes in arrears and debt relief); changes in gross foreign assets; and valuation adjustments. For projections also includes contribution from price and exchange rate changes.
Assumes that PV of private sector debt is equivalent to its face value.
Current-year interest payments divided by previous period debt stock.
Historical averages and standard deviations are generally derived over the past 10 years, subject to data availability.
Defined as grants, concessional loans, and debt relief.
Grant-equivalent financing includes grants provided directly to the government and through new borrowing (difference between the face value and the PV of new debt).
Senegal: Public Sector Debt Sustainability Framework, Baseline Scenario, 2012–35 1/
(In percent of GDP, unless otherwise indicated)
| Actual | Historical Average6/ | Standard Deviation6/ | Projections | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2015-2020 Average | 2025 | 2035 | 2021-2035 Average | |||||||
| External debt (nominal) 1/ | 60.8 | 68.2 | 71.1 | 71.7 | 71.3 | 70.1 | 68.4 | 65.4 | 64.3 | 58.4 | 51.7 | ||||||||
| of which: public and publicly guaranteed (PPG) | 30.6 | 32.4 | 39.4 | 35.7 | 37.7 | 37.5 | 36.6 | 35.6 | 34.6 | 30.8 | 20.1 | ||||||||
| Change in external debt | 6.3 | 7.4 | 2.9 | 0.6 | −0.4 | −1.2 | −1.7 | −3.0 | −1.1 | −1.7 | 2.1 | ||||||||
| Identified net debt-creating flows | 9.9 | 5.6 | 3.6 | 1.8 | 1.2 | 0.5 | 0.1 | −0.2 | 0.0 | 0.1 | 0.6 | ||||||||
| Non-interest current account deficit | 9.9 | 9.4 | 7.9 | 8.3 | 2.8 | 7.3 | 6.4 | 6.2 | 6.0 | 5.8 | 5.9 | 5.9 | 6.1 | 5.9 | |||||
| Deficit in balance of goods and services | 21.0 | 20.7 | 19.0 | 19.0 | 18.3 | 18.3 | 17.9 | 17.5 | 16.2 | 12.9 | 12.0 | ||||||||
| Exports | 27.9 | 28.1 | 27.4 | 26.4 | 25.5 | 25.5 | 25.5 | 25.2 | 25.2 | 22.7 | 20.3 | ||||||||
| Imports | 48.9 | 48.8 | 46.3 | 45.3 | 43.8 | 43.8 | 43.3 | 42.7 | 41.4 | 35.6 | 32.3 | ||||||||
| Net current transfers (negative = inflow) | −12.3 | −12.5 | −12.4 | −11.4 | 1.5 | −13.0 | −13.1 | −12.9 | −12.7 | −12.3 | −11.2 | −7.4 | −6.2 | −7.4 | |||||
| of which: official | −1.0 | −0.6 | −0.7 | −1.0 | −1.2 | −1.2 | −1.2 | −1.1 | −0.9 | −0.7 | −0.5 | ||||||||
| Other current account flows (negative = net inflow) | 1.3 | 1.2 | 1.3 | 1.3 | 1.2 | 0.9 | 0.8 | 0.6 | 0.8 | 0.5 | 0.3 | ||||||||
| Net FDI (negative = inflow) | −1.5 | −1.9 | −2.0 | −1.9 | 0.5 | −2.1 | −2.1 | −2.2 | −2.3 | −2.3 | −2.3 | −2.3 | −2.3 | −2.3 | |||||
| Endogenous debt dynamics 2/ | 1.5 | −2.0 | −2.3 | −3.4 | −3.1 | −3.5 | −3.7 | −3.7 | −3.5 | −3.4 | −3.2 | ||||||||
| Contribution from nominal interest rate | 1.0 | 0.9 | 0.9 | 0.8 | 0.7 | 0.7 | 0.8 | 0.8 | 0.8 | 0.7 | 0.5 | ||||||||
| Contribution from real GDP growth | −2.4 | −2.1 | −3.1 | −4.1 | −3.8 | −4.2 | −4.4 | −4.5 | −4.3 | −4.1 | −3.7 | ||||||||
| Contribution from price and exchange rate changes | 3.0 | −0.8 | −0.1 | … | … | … | … | … | … | … | … | ||||||||
| Residual (3-4) 3/ | −3.6 | 1.8 | −0.7 | −1.3 | −1.6 | −1.8 | −1.7 | −2.8 | −1.1 | −1.8 | 1.5 | ||||||||
| of which: exceptional financing | −1.4 | −0.1 | 1.5 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||
| PV of external debt 4/ | … | … | 54.8 | 60.5 | 58.8 | 58.2 | 57.2 | 54.8 | 54.2 | 51.0 | 47.5 | ||||||||
| In percent of exports | … | … | 200.3 | 229.6 | 231.0 | 227.9 | 224.7 | 217.7 | 214.9 | 224.7 | 233.7 | ||||||||
| PV of PPG external debt | … | … | 23.1 | 24.6 | 25.3 | 25.6 | 25.4 | 25.0 | 24.4 | 23.3 | 15.9 | ||||||||
| In percent of exports | … | … | 84.3 | 93.2 | 99.2 | 100.2 | 99.7 | 99.2 | 96.9 | 102.8 | 78.3 | ||||||||
| In percent of government revenues | … | … | 110.0 | 114.9 | 118.9 | 121.1 | 119.4 | 116.5 | 113.5 | 111.7 | 76.3 | ||||||||
| Total gross financing need (Billions of U.S. dollars) | 1.6 | 1.5 | 1.5 | 1.6 | 1.1 | 1.0 | 1.1 | 1.2 | 1.3 | 2.3 | 5.4 | ||||||||
| Non-interest current account deficit that stabilizes debt ratio | 3.6 | 2.1 | 4.9 | 6.7 | 6.8 | 7.5 | 7.7 | 8.8 | 7.0 | 7.6 | 4.0 | ||||||||
| Key macroeconomic assumptions | |||||||||||||||||||
| Real GDP growth (in percent) | 4.4 | 3.6 | 4.7 | 3.8 | 1.2 | 5.1 | 5.9 | 6.5 | 7.0 | 7.3 | 7.3 | 6.5 | 7.6 | 8.2 | 7.8 | ||||
| GDP deflator in US dollar terms (change in percent) | −5.2 | 1.4 | 0.2 | 3.3 | 7.7 | −16.7 | 6.3 | 3.3 | 3.5 | 3.6 | 4.2 | 0.7 | 2.4 | 2.5 | 2.5 | ||||
| Effective interest rate (percent) 5/ | 1.7 | 1.6 | 1.4 | 1.8 | 0.4 | 1.0 | 1.1 | 1.2 | 1.2 | 1.3 | 1.3 | 1.2 | 1.3 | 1.1 | 1.2 | ||||
| Growth of exports of G&S (US dollar terms, in percent) | 4.7 | 6.0 | 2.0 | 7.4 | 10.0 | −15.7 | 8.8 | 10.4 | 10.3 | 9.9 | 11.9 | 5.9 | 9.0 | 10.5 | 8.9 | ||||
| Growth of imports of G&S (US dollar terms, in percent) | 8.2 | 5.0 | −0.5 | 9.9 | 17.3 | −14.4 | 8.7 | 10.2 | 9.4 | 9.5 | 8.5 | 5.3 | 7.9 | 10.5 | 8.6 | ||||
| Grant element of new public sector borrowing (in percent) | … | … | … | … | … | 29.3 | 21.7 | 21.9 | 22.5 | 22.6 | 22.8 | 23.5 | 22.5 | 22.1 | 21.8 | ||||
| Government revenues (excluding grants, in percent of GDP) | 20.5 | 19.9 | 21.0 | 21.4 | 21.2 | 21.1 | 21.3 | 21.4 | 21.5 | 20.9 | 20.8 | 20.8 | |||||||
| Aid flows (in Billions of US dollars) 7/ | 1.0 | 0.8 | 0.7 | 0.4 | 0.5 | 0.5 | 0.6 | 0.6 | 0.6 | 0.9 | 1.3 | ||||||||
| of which: Grants | 0.4 | 0.4 | 0.5 | 0.4 | 0.5 | 0.5 | 0.5 | 0.6 | 0.6 | 0.8 | 1.0 | ||||||||
| of which: Concessional loans | 0.6 | 0.4 | 0.2 | 0.0 | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | 0.3 | ||||||||
| Grant-equivalent financing (in percent of GDP) 8/ | … | … | … | 3.5 | 3.8 | 3.7 | 3.5 | 3.4 | 3.1 | 2.7 | 1.5 | 2.4 | |||||||
| Grant-equivalent financing (in percent of external financing) 8/ | … | … | … | 70.2 | 54.8 | 55.2 | 56.9 | 57.2 | 56.2 | 54.5 | 45.0 | 51.2 | |||||||
| Memorandum items: | |||||||||||||||||||
| Nominal GDP (Billions of US dollars) | 14.2 | 15.0 | 15.7 | 13.7 | 15.5 | 17.0 | 18.8 | 20.9 | 23.4 | 37.8 | 103.6 | ||||||||
| Nominal dollar GDP growth | −1.1 | 5.1 | 4.9 | −12.5 | 12.6 | 10.1 | 10.7 | 11.1 | 11.7 | 7.3 | 10.2 | 10.9 | 10.4 | ||||||
| PV of PPG external debt (in Billions of US dollars) | 3.4 | 3.5 | 3.9 | 4.4 | 4.8 | 5.3 | 5.8 | 8.8 | 16.5 | ||||||||||
| (PVt-PVt-1)/GDPt-1 (in percent) | 1.0 | 3.0 | 3.0 | 2.5 | 2.4 | 2.3 | 2.4 | 1.7 | 1.0 | 1.6 | |||||||||
| Gross workers’ remittances (Billions of US dollars) | 1.9 | 2.1 | 2.1 | 1.9 | 2.2 | 2.3 | 2.5 | 2.7 | 2.8 | 3.0 | 6.9 | ||||||||
| PV of PPG external debt (in percent of GDP + remittances) | … | … | 20.3 | 21.5 | 22.1 | 22.5 | 22.4 | 22.1 | 21.8 | 21.6 | 14.9 | ||||||||
| PV of PPG external debt (in percent of exports + remittances) | … | … | 56.3 | 60.8 | 64.0 | 65.1 | 65.2 | 65.2 | 65.5 | 76.4 | 59.0 | ||||||||
| Debt service of PPG external debt (in percent of exports + remittances) | … | … | 5.4 | 12.8 | 4.2 | 3.2 | 3.5 | 3.2 | 2.9 | 5.8 | 6.2 | ||||||||
Includes both public and private sector external debt.
Derived as [r - g - ρ(1+g)]/(1+g+ρ+gρ) times previous period debt ratio, with r = nominal interest rate; g = real GDP growth rate, and ρ = growth rate of GDP deflator in U.S. dollar terms.
Includes exceptional financing (i.e., changes in arrears and debt relief); changes in gross foreign assets; and valuation adjustments. For projections also includes contribution from price and exchange rate changes.
Assumes that PV of private sector debt is equivalent to its face value.
Current-year interest payments divided by previous period debt stock.
Historical averages and standard deviations are generally derived over the past 10 years, subject to data availability.
Defined as grants, concessional loans, and debt relief.
Grant-equivalent financing includes grants provided directly to the government and through new borrowing (difference between the face value and the PV of new debt).
Senegal: Sensitivity Analysis for Key Indicators of Public and Publicly Guaranteed External Debt, 2015–35
(In percent)
Senegal: Sensitivity Analysis for Key Indicators of Public and Publicly Guaranteed External Debt, 2015–35
(In percent)
| Projections | ||||||||
|---|---|---|---|---|---|---|---|---|
| 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2025 | 2035 | |
| PV of debt-to GDP ratio | ||||||||
| Baseline | 25 | 25 | 26 | 25 | 25 | 24 | 23 | 16 |
| A. Alternative Scenarios | ||||||||
| A1. Key variables at their historical averages in 2015-2035 1/ | 25 | 28 | 31 | 33 | 35 | 37 | 45 | 34 |
| A2. New public sector loans on less favorable terms in 2015-2035 2/ | 25 | 26 | 27 | 28 | 28 | 28 | 29 | 23 |
| Authorities’ PSE framework | 26 | 31 | 33 | 36 | 38 | 41 | 33 | 22 |
| B. Bound Tests | ||||||||
| B1. Real GDP growth at historical average minus one standard deviation in 2016-2017 | 25 | 26 | 28 | 27 | 27 | 26 | 25 | 17 |
| B2. Export value growth at historical average minus one standard deviation in 2016-2017 3/ | 25 | 27 | 32 | 31 | 31 | 30 | 26 | 16 |
| B3. US dollar GDP deflator at historical average minus one standard deviation in 2016-2017 | 25 | 28 | 31 | 31 | 30 | 30 | 28 | 19 |
| B4. Net non-debt creating flows at historical average minus one standard deviation in 2016-2017 4/ | 25 | 29 | 32 | 31 | 31 | 30 | 26 | 16 |
| B5. Combination of B1-B4 using one-half standard deviation shocks | 25 | 33 | 43 | 42 | 41 | 39 | 33 | 19 |
| B6. One-time 30 percent nominal depreciation relative to the baseline in 2016 5/ | 25 | 35 | 36 | 36 | 35 | 34 | 33 | 22 |
| PV of debt-to-exports ratio | ||||||||
| Baseline | 93 | 99 | 100 | 100 | 99 | 97 | 103 | 78 |
| A. Alternative Scenarios | ||||||||
| A1. Key variables at their historical averages in 2015-2035 1/ | 93 | 110 | 120 | 130 | 141 | 148 | 196 | 168 |
| A2. New public sector loans on less favorable terms in 2015-2035 2/ | 93 | 103 | 106 | 108 | 110 | 110 | 126 | 111 |
| Authorities’ PSE framework | 95 | 115 | 124 | 135 | 143 | 151 | 137 | 82 |
| B. Bound Tests | ||||||||
| B1. Real GDP growth at historical average minus one standard deviation in 2016-2017 | 93 | 100 | 101 | 100 | 100 | 98 | 103 | 78 |
| B2. Export value growth at historical average minus one standard deviation in 2016-2017 3/ | 93 | 121 | 159 | 156 | 155 | 150 | 146 | 101 |
| B3. US dollar GDP deflator at historical average minus one standard deviation in 2016-2017 | 93 | 100 | 101 | 100 | 100 | 98 | 103 | 78 |
| B4. Net non-debt creating flows at historical average minus one standard deviation in 2016-2017 4/ | 93 | 112 | 124 | 123 | 121 | 117 | 115 | 80 |
| B5. Combination of B1-B4 using one-half standard deviation shocks | 93 | 124 | 162 | 159 | 157 | 151 | 141 | 93 |
| B6. One-time 30 percent nominal depreciation relative to the baseline in 2016 5/ | 93 | 100 | 101 | 100 | 100 | 98 | 103 | 78 |
| PV of debt-to-revenue ratio | ||||||||
| Baseline | 115 | 119 | 121 | 119 | 116 | 113 | 112 | 76 |
| A. Alternative Scenarios | ||||||||
| A1. Key variables at their historical averages in 2015-2035 1/ | 115 | 132 | 145 | 155 | 165 | 173 | 213 | 164 |
| A2. New public sector loans on less favorable terms in 2015-2035 2/ | 115 | 123 | 129 | 130 | 129 | 128 | 137 | 109 |
| Authorities’ PSE framework | 134 | 156 | 166 | 177 | 189 | 203 | 164 | 107 |
| B. Bound Tests | ||||||||
| B1. Real GDP growth at historical average minus one standard deviation in 2016-2017 | 115 | 123 | 131 | 129 | 126 | 123 | 120 | 82 |
| B2. Export value growth at historical average minus one standard deviation in 2016-2017 3/ | 115 | 129 | 151 | 148 | 143 | 138 | 125 | 78 |
| B3. US dollar GDP deflator at historical average minus one standard deviation in 2016-2017 | 115 | 133 | 146 | 144 | 141 | 138 | 134 | 92 |
| B4. Net non-debt creating flows at historical average minus one standard deviation in 2016-2017 4/ | 115 | 134 | 150 | 147 | 142 | 138 | 125 | 78 |
| B5. Combination of B1-B4 using one-half standard deviation shocks | 115 | 154 | 202 | 196 | 189 | 182 | 158 | 93 |
| B6. One-time 30 percent nominal depreciation relative to the baseline in 2016 5/ | 115 | 166 | 170 | 167 | 164 | 159 | 156 | 106 |
Senegal: Sensitivity Analysis for Key Indicators of Public and Publicly Guaranteed External Debt, 2015–35
(In percent)
| Projections | ||||||||
|---|---|---|---|---|---|---|---|---|
| 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2025 | 2035 | |
| PV of debt-to GDP ratio | ||||||||
| Baseline | 25 | 25 | 26 | 25 | 25 | 24 | 23 | 16 |
| A. Alternative Scenarios | ||||||||
| A1. Key variables at their historical averages in 2015-2035 1/ | 25 | 28 | 31 | 33 | 35 | 37 | 45 | 34 |
| A2. New public sector loans on less favorable terms in 2015-2035 2/ | 25 | 26 | 27 | 28 | 28 | 28 | 29 | 23 |
| Authorities’ PSE framework | 26 | 31 | 33 | 36 | 38 | 41 | 33 | 22 |
| B. Bound Tests | ||||||||
| B1. Real GDP growth at historical average minus one standard deviation in 2016-2017 | 25 | 26 | 28 | 27 | 27 | 26 | 25 | 17 |
| B2. Export value growth at historical average minus one standard deviation in 2016-2017 3/ | 25 | 27 | 32 | 31 | 31 | 30 | 26 | 16 |
| B3. US dollar GDP deflator at historical average minus one standard deviation in 2016-2017 | 25 | 28 | 31 | 31 | 30 | 30 | 28 | 19 |
| B4. Net non-debt creating flows at historical average minus one standard deviation in 2016-2017 4/ | 25 | 29 | 32 | 31 | 31 | 30 | 26 | 16 |
| B5. Combination of B1-B4 using one-half standard deviation shocks | 25 | 33 | 43 | 42 | 41 | 39 | 33 | 19 |
| B6. One-time 30 percent nominal depreciation relative to the baseline in 2016 5/ | 25 | 35 | 36 | 36 | 35 | 34 | 33 | 22 |
| PV of debt-to-exports ratio | ||||||||
| Baseline | 93 | 99 | 100 | 100 | 99 | 97 | 103 | 78 |
| A. Alternative Scenarios | ||||||||
| A1. Key variables at their historical averages in 2015-2035 1/ | 93 | 110 | 120 | 130 | 141 | 148 | 196 | 168 |
| A2. New public sector loans on less favorable terms in 2015-2035 2/ | 93 | 103 | 106 | 108 | 110 | 110 | 126 | 111 |
| Authorities’ PSE framework | 95 | 115 | 124 | 135 | 143 | 151 | 137 | 82 |
| B. Bound Tests | ||||||||
| B1. Real GDP growth at historical average minus one standard deviation in 2016-2017 | 93 | 100 | 101 | 100 | 100 | 98 | 103 | 78 |
| B2. Export value growth at historical average minus one standard deviation in 2016-2017 3/ | 93 | 121 | 159 | 156 | 155 | 150 | 146 | 101 |
| B3. US dollar GDP deflator at historical average minus one standard deviation in 2016-2017 | 93 | 100 | 101 | 100 | 100 | 98 | 103 | 78 |
| B4. Net non-debt creating flows at historical average minus one standard deviation in 2016-2017 4/ | 93 | 112 | 124 | 123 | 121 | 117 | 115 | 80 |
| B5. Combination of B1-B4 using one-half standard deviation shocks | 93 | 124 | 162 | 159 | 157 | 151 | 141 | 93 |
| B6. One-time 30 percent nominal depreciation relative to the baseline in 2016 5/ | 93 | 100 | 101 | 100 | 100 | 98 | 103 | 78 |
| PV of debt-to-revenue ratio | ||||||||
| Baseline | 115 | 119 | 121 | 119 | 116 | 113 | 112 | 76 |
| A. Alternative Scenarios | ||||||||
| A1. Key variables at their historical averages in 2015-2035 1/ | 115 | 132 | 145 | 155 | 165 | 173 | 213 | 164 |
| A2. New public sector loans on less favorable terms in 2015-2035 2/ | 115 | 123 | 129 | 130 | 129 | 128 | 137 | 109 |
| Authorities’ PSE framework | 134 | 156 | 166 | 177 | 189 | 203 | 164 | 107 |
| B. Bound Tests | ||||||||
| B1. Real GDP growth at historical average minus one standard deviation in 2016-2017 | 115 | 123 | 131 | 129 | 126 | 123 | 120 | 82 |
| B2. Export value growth at historical average minus one standard deviation in 2016-2017 3/ | 115 | 129 | 151 | 148 | 143 | 138 | 125 | 78 |
| B3. US dollar GDP deflator at historical average minus one standard deviation in 2016-2017 | 115 | 133 | 146 | 144 | 141 | 138 | 134 | 92 |
| B4. Net non-debt creating flows at historical average minus one standard deviation in 2016-2017 4/ | 115 | 134 | 150 | 147 | 142 | 138 | 125 | 78 |
| B5. Combination of B1-B4 using one-half standard deviation shocks | 115 | 154 | 202 | 196 | 189 | 182 | 158 | 93 |
| B6. One-time 30 percent nominal depreciation relative to the baseline in 2016 5/ | 115 | 166 | 170 | 167 | 164 | 159 | 156 | 106 |
Senegal: Public Sector Debt Sustainability Framework, Baseline Scenario, 2012–35
(In percent of GDP, unless otherwise indicated)
[Indicate coverage of public sector, e.g., general government or nonfinancial public sector. Also whether net or gross debt is used.]
Gross financing need is defined as the primary deficit plus debt service plus the stock of short-term debt at the end of the last period.
Revenues excluding grants.
Debt service is defined as the sum of interest and amortization of medium and long-term debt.
Historical averages and standard deviations are generally derived over the past 10 years, subject to data availability.
Senegal: Public Sector Debt Sustainability Framework, Baseline Scenario, 2012–35
(In percent of GDP, unless otherwise indicated)
| Actual | Average5/ | Standard5/ | Estimate | Projections | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2015-20 Average | 2025 | 2035 | 2021-35 Average | ||||||
| Public sector debt 1/ | 42.8 | 46.6 | 53.1 | 55.0 | 55.9 | 55.6 | 53.0 | 49.8 | 48.5 | 43.0 | 30.6 | |||||||
| of which: foreign-currency denominated | 30.6 | 32.4 | 39.4 | 35.7 | 37.7 | 37.5 | 36.6 | 35.6 | 34.6 | 30.8 | 20.1 | |||||||
| Change in public sector debt | 2.1 | 3.8 | 6.5 | 1.9 | 0.9 | −0.4 | −2.6 | −3.1 | −1.3 | 0.3 | −1.6 | |||||||
| Identified debt-creating flows | 2.1 | 3.5 | 6.3 | 4.6 | −0.1 | −1.4 | −2.2 | −2.4 | −2.4 | −1.1 | −0.6 | |||||||
| Primary deficit | 3.7 | 4.0 | 3.2 | 3.3 | 1.4 | 3.2 | 2.7 | 2.1 | 1.4 | 1.3 | 1.3 | 2.0 | 1.3 | 1.4 | 1.3 | |||
| Revenue and grants | 23.3 | 22.5 | 24.2 | 24.3 | 24.2 | 24.0 | 24.0 | 24.1 | 23.9 | 22.9 | 21.8 | |||||||
| of which: grants | 2.8 | 2.5 | 3.3 | 2.9 | 2.9 | 2.8 | 2.7 | 2.6 | 2.4 | 2.0 | 1.0 | |||||||
| Primary (noninterest) expenditure | 27.0 | 26.4 | 27.5 | 27.5 | 26.9 | 26.0 | 25.4 | 25.3 | 25.2 | 24.2 | 23.2 | |||||||
| Automatic debt dynamics | −1.1 | −0.5 | 3.1 | 1.4 | −2.8 | −3.4 | −3.6 | −3.7 | −3.7 | −2.5 | −2.0 | |||||||
| Contribution from interest rate/growth differential | −1.2 | 0.8 | −0.5 | −1.8 | −2.7 | −3.1 | −3.2 | −3.2 | −3.1 | −2.5 | −2.0 | |||||||
| of which: contribution from average real interest rate | 0.5 | 2.3 | 1.6 | 0.8 | 0.3 | 0.4 | 0.4 | 0.4 | 0.2 | 0.5 | 0.4 | |||||||
| of which: contribution from real GDP growth | −1.7 | −1.5 | −2.1 | −2.6 | −3.1 | −3.4 | −3.6 | −3.6 | −3.4 | −3.0 | −2.4 | |||||||
| Contribution from real exchange rate depreciation | 0.1 | −1.3 | 3.5 | 3.2 | −0.1 | −0.4 | −0.4 | −0.5 | −0.6 | |||||||||
| Other identified debt-creating flows | −0.5 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
| Privatization receipts (negative) | −0.5 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
| Recognition of implicit or contingent liabilities | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
| Debt relief (HIPC and other) | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
| Other (specify, e.g. bank recapitalization) | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
| Residual, including asset changes | 0.1 | 0.4 | 0.2 | −2.7 | 1.1 | 1.0 | −0.4 | −0.7 | 1.1 | 1.4 | −0.9 | |||||||
| Other Sustainability Indicators | ||||||||||||||||||
| PV of public sector debt | … | … | 36.8 | 43.8 | 43.4 | 43.7 | 41.7 | 39.2 | 38.3 | 35.6 | 26.4 | |||||||
| of which: foreign-currency denominated | … | … | 23.1 | 24.6 | 25.3 | 25.6 | 25.4 | 25.0 | 24.4 | 23.3 | 15.9 | |||||||
| of which: external | … | … | 23.1 | 24.6 | 25.3 | 25.6 | 25.4 | 25.0 | 24.4 | 23.3 | 15.9 | |||||||
| PV of contingent liabilities (not included in public sector debt) | … | … | … | … | … | … | … | … | … | … | … | |||||||
| Gross financing need 2/ | 11.5 | 12.1 | 12.9 | 14.5 | 8.3 | 7.0 | 7.2 | 5.8 | 4.7 | 5.3 | 4.3 | |||||||
| PV of public sector debt-to-revenue and grants ratio (in percent) | … | … | 151.9 | 180.4 | 179.8 | 182.3 | 173.8 | 162.7 | 160.4 | 155.5 | 121.2 | |||||||
| PV of public sector debt-to-revenue ratio (in percent) | … | … | 175.6 | 204.9 | 204.5 | 206.8 | 196.3 | 182.8 | 178.1 | 170.5 | 126.8 | |||||||
| of which: external 3/ | … | … | 110.0 | 114.9 | 118.9 | 121.1 | 119.4 | 116.5 | 113.5 | 111.7 | 76.3 | |||||||
| Primary deficit that stabilizes the debt-to-GDP ratio | 1.6 | 0.1 | −3.3 | 1.3 | 1.8 | 2.4 | 4.0 | 4.4 | 2.6 | 1.0 | 2.9 | |||||||
| Key macroeconomic and fiscal assumptions | ||||||||||||||||||
| Real GDP growth (in percent) | 4.4 | 3.6 | 4.7 | 3.8 | 1.2 | 5.1 | 5.9 | 6.5 | 7.0 | 7.3 | 7.3 | 6.5 | 7.6 | 8.2 | 7.8 | |||
| Average nominal interest rate on forex debt (in percent) | 2.5 | 2.5 | 2.5 | 2.5 | 0.6 | 1.6 | 2.0 | 2.0 | 2.1 | 2.1 | 2.2 | 2.0 | 2.2 | 2.4 | 2.3 | |||
| Average real interest rate on domestic debt (in percent) | 4.5 | 8.5 | 6.4 | 3.6 | 3.9 | 5.5 | 2.6 | 2.9 | 2.9 | 3.0 | 2.2 | 3.2 | 6.2 | 4.5 | 4.8 | |||
| Real exchange rate depreciation (in percent, + indicates depreciation) | 0.5 | −4.3 | 11.2 | 1.2 | 8.8 | 8.6 | … | … | … | … | … | … | … | … | … | |||
| Inflation rate (GDP deflator, in percent) | 2.6 | −1.9 | 0.1 | 2.4 | 2.9 | 1.4 | 2.3 | 2.3 | 2.3 | 2.3 | 2.3 | 2.2 | 2.4 | 2.5 | 2.5 | |||
| Growth of real primary spending (deflated by GDP deflator, in percent) | 3.5 | 1.2 | 8.9 | 1.4 | 2.9 | 5.0 | 3.8 | 3.2 | 4.4 | 7.0 | 6.7 | 5.0 | 6.8 | 7.3 | 7.2 | |||
| Grant element of new external borrowing (in percent) | … | … | … | … | … | 29.3 | 21.7 | 21.9 | 22.5 | 22.6 | 22.8 | 23.5 | 22.5 | 22.1 | … | |||
[Indicate coverage of public sector, e.g., general government or nonfinancial public sector. Also whether net or gross debt is used.]
Gross financing need is defined as the primary deficit plus debt service plus the stock of short-term debt at the end of the last period.
Revenues excluding grants.
Debt service is defined as the sum of interest and amortization of medium and long-term debt.
Historical averages and standard deviations are generally derived over the past 10 years, subject to data availability.
Senegal: Public Sector Debt Sustainability Framework, Baseline Scenario, 2012–35
(In percent of GDP, unless otherwise indicated)
| Actual | Average5/ | Standard5/ | Estimate | Projections | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2015-20 Average | 2025 | 2035 | 2021-35 Average | ||||||
| Public sector debt 1/ | 42.8 | 46.6 | 53.1 | 55.0 | 55.9 | 55.6 | 53.0 | 49.8 | 48.5 | 43.0 | 30.6 | |||||||
| of which: foreign-currency denominated | 30.6 | 32.4 | 39.4 | 35.7 | 37.7 | 37.5 | 36.6 | 35.6 | 34.6 | 30.8 | 20.1 | |||||||
| Change in public sector debt | 2.1 | 3.8 | 6.5 | 1.9 | 0.9 | −0.4 | −2.6 | −3.1 | −1.3 | 0.3 | −1.6 | |||||||
| Identified debt-creating flows | 2.1 | 3.5 | 6.3 | 4.6 | −0.1 | −1.4 | −2.2 | −2.4 | −2.4 | −1.1 | −0.6 | |||||||
| Primary deficit | 3.7 | 4.0 | 3.2 | 3.3 | 1.4 | 3.2 | 2.7 | 2.1 | 1.4 | 1.3 | 1.3 | 2.0 | 1.3 | 1.4 | 1.3 | |||
| Revenue and grants | 23.3 | 22.5 | 24.2 | 24.3 | 24.2 | 24.0 | 24.0 | 24.1 | 23.9 | 22.9 | 21.8 | |||||||
| of which: grants | 2.8 | 2.5 | 3.3 | 2.9 | 2.9 | 2.8 | 2.7 | 2.6 | 2.4 | 2.0 | 1.0 | |||||||
| Primary (noninterest) expenditure | 27.0 | 26.4 | 27.5 | 27.5 | 26.9 | 26.0 | 25.4 | 25.3 | 25.2 | 24.2 | 23.2 | |||||||
| Automatic debt dynamics | −1.1 | −0.5 | 3.1 | 1.4 | −2.8 | −3.4 | −3.6 | −3.7 | −3.7 | −2.5 | −2.0 | |||||||
| Contribution from interest rate/growth differential | −1.2 | 0.8 | −0.5 | −1.8 | −2.7 | −3.1 | −3.2 | −3.2 | −3.1 | −2.5 | −2.0 | |||||||
| of which: contribution from average real interest rate | 0.5 | 2.3 | 1.6 | 0.8 | 0.3 | 0.4 | 0.4 | 0.4 | 0.2 | 0.5 | 0.4 | |||||||
| of which: contribution from real GDP growth | −1.7 | −1.5 | −2.1 | −2.6 | −3.1 | −3.4 | −3.6 | −3.6 | −3.4 | −3.0 | −2.4 | |||||||
| Contribution from real exchange rate depreciation | 0.1 | −1.3 | 3.5 | 3.2 | −0.1 | −0.4 | −0.4 | −0.5 | −0.6 | |||||||||
| Other identified debt-creating flows | −0.5 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
| Privatization receipts (negative) | −0.5 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
| Recognition of implicit or contingent liabilities | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
| Debt relief (HIPC and other) | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
| Other (specify, e.g. bank recapitalization) | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||
| Residual, including asset changes | 0.1 | 0.4 | 0.2 | −2.7 | 1.1 | 1.0 | −0.4 | −0.7 | 1.1 | 1.4 | −0.9 | |||||||
| Other Sustainability Indicators | ||||||||||||||||||
| PV of public sector debt | … | … | 36.8 | 43.8 | 43.4 | 43.7 | 41.7 | 39.2 | 38.3 | 35.6 | 26.4 | |||||||
| of which: foreign-currency denominated | … | … | 23.1 | 24.6 | 25.3 | 25.6 | 25.4 | 25.0 | 24.4 | 23.3 | 15.9 | |||||||
| of which: external | … | … | 23.1 | 24.6 | 25.3 | 25.6 | 25.4 | 25.0 | 24.4 | 23.3 | 15.9 | |||||||
| PV of contingent liabilities (not included in public sector debt) | … | … | … | … | … | … | … | … | … | … | … | |||||||
| Gross financing need 2/ | 11.5 | 12.1 | 12.9 | 14.5 | 8.3 | 7.0 | 7.2 | 5.8 | 4.7 | 5.3 | 4.3 | |||||||
| PV of public sector debt-to-revenue and grants ratio (in percent) | … | … | 151.9 | 180.4 | 179.8 | 182.3 | 173.8 | 162.7 | 160.4 | 155.5 | 121.2 | |||||||
| PV of public sector debt-to-revenue ratio (in percent) | … | … | 175.6 | 204.9 | 204.5 | 206.8 | 196.3 | 182.8 | 178.1 | 170.5 | 126.8 | |||||||
| of which: external 3/ | … | … | 110.0 | 114.9 | 118.9 | 121.1 | 119.4 | 116.5 | 113.5 | 111.7 | 76.3 | |||||||
| Primary deficit that stabilizes the debt-to-GDP ratio | 1.6 | 0.1 | −3.3 | 1.3 | 1.8 | 2.4 | 4.0 | 4.4 | 2.6 | 1.0 | 2.9 | |||||||
| Key macroeconomic and fiscal assumptions | ||||||||||||||||||
| Real GDP growth (in percent) | 4.4 | 3.6 | 4.7 | 3.8 | 1.2 | 5.1 | 5.9 | 6.5 | 7.0 | 7.3 | 7.3 | 6.5 | 7.6 | 8.2 | 7.8 | |||
| Average nominal interest rate on forex debt (in percent) | 2.5 | 2.5 | 2.5 | 2.5 | 0.6 | 1.6 | 2.0 | 2.0 | 2.1 | 2.1 | 2.2 | 2.0 | 2.2 | 2.4 | 2.3 | |||
| Average real interest rate on domestic debt (in percent) | 4.5 | 8.5 | 6.4 | 3.6 | 3.9 | 5.5 | 2.6 | 2.9 | 2.9 | 3.0 | 2.2 | 3.2 | 6.2 | 4.5 | 4.8 | |||
| Real exchange rate depreciation (in percent, + indicates depreciation) | 0.5 | −4.3 | 11.2 | 1.2 | 8.8 | 8.6 | … | … | … | … | … | … | … | … | … | |||
| Inflation rate (GDP deflator, in percent) | 2.6 | −1.9 | 0.1 | 2.4 | 2.9 | 1.4 | 2.3 | 2.3 | 2.3 | 2.3 | 2.3 | 2.2 | 2.4 | 2.5 | 2.5 | |||
| Growth of real primary spending (deflated by GDP deflator, in percent) | 3.5 | 1.2 | 8.9 | 1.4 | 2.9 | 5.0 | 3.8 | 3.2 | 4.4 | 7.0 | 6.7 | 5.0 | 6.8 | 7.3 | 7.2 | |||
| Grant element of new external borrowing (in percent) | … | … | … | … | … | 29.3 | 21.7 | 21.9 | 22.5 | 22.6 | 22.8 | 23.5 | 22.5 | 22.1 | … | |||
[Indicate coverage of public sector, e.g., general government or nonfinancial public sector. Also whether net or gross debt is used.]
Gross financing need is defined as the primary deficit plus debt service plus the stock of short-term debt at the end of the last period.
Revenues excluding grants.
Debt service is defined as the sum of interest and amortization of medium and long-term debt.
Historical averages and standard deviations are generally derived over the past 10 years, subject to data availability.
Senegal: Sensitivity Analysis for Key Indicators of Public Debt, 2015–35
Assumes that real GDP growth is at baseline minus one standard deviation divided by the square root of the length of the projection period.
Revenues are defined inclusive of grants.
Senegal: Sensitivity Analysis for Key Indicators of Public Debt, 2015–35
| Projections | ||||||||
|---|---|---|---|---|---|---|---|---|
| 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2025 | 2035 | |
| PV of Debt-to-GDP Ratio | ||||||||
| Baseline | 44 | 43 | 44 | 42 | 39 | 38 | 36 | 26 |
| A. Alternative scenarios | ||||||||
| A1. Real GDP growth and primary balance are at historical averages | 44 | 45 | 47 | 48 | 48 | 50 | 60 | 70 |
| A2. Primary balance is unchanged from 2015 | 44 | 44 | 45 | 44 | 43 | 44 | 46 | 43 |
| A3. Permanently lower GDP growth 1/ | 44 | 44 | 44 | 42 | 40 | 39 | 39 | 34 |
| Authorities’ PSE framework | 45 | 45 | 48 | 48 | 49 | 51 | 38 | 19 |
| B. Bound tests | ||||||||
| B1. Real GDP growth is at historical average minus one standard deviations in 2016-2017 | 44 | 45 | 49 | 48 | 46 | 46 | 48 | 43 |
| B2. Primary balance is at historical average minus one standard deviations in 2016-2017 | 44 | 45 | 48 | 45 | 42 | 41 | 38 | 27 |
| B3. Combination of B1-B2 using one half standard deviation shocks | 44 | 46 | 49 | 48 | 46 | 46 | 46 | 40 |
| B4. One-time 30 percent real depreciation in 2016 | 44 | 53 | 52 | 49 | 46 | 44 | 40 | 29 |
| B5. 10 percent of GDP increase in other debt-creating flows in 2016 | 44 | 52 | 52 | 49 | 46 | 45 | 40 | 29 |
| PV of Debt-to-Revenue Ratio 2/ | ||||||||
| Baseline | 180 | 180 | 182 | 174 | 163 | 160 | 155 | 121 |
| A. Alternative scenarios | ||||||||
| A1. Real GDP growth and primary balance are at historical averages | 180 | 185 | 196 | 198 | 197 | 206 | 254 | 307 |
| A2. Primary balance is unchanged from 2015 | 180 | 181 | 188 | 185 | 180 | 183 | 202 | 199 |
| A3. Permanently lower GDP growth 1/ | 180 | 180 | 184 | 176 | 166 | 165 | 168 | 157 |
| Authorities’ PSE framework | 185 | 203 | 207 | 209 | 209 | 217 | 164 | 79 |
| B. Bound tests | ||||||||
| B1. Real GDP growth is at historical average minus one standard deviations in 2016-2017 | 180 | 187 | 202 | 198 | 191 | 192 | 207 | 195 |
| B2. Primary balance is at historical average minus one standard deviations in 2016-2017 | 180 | 187 | 198 | 189 | 176 | 173 | 165 | 126 |
| B3. Combination of B1-B2 using one half standard deviation shocks | 180 | 188 | 202 | 197 | 189 | 190 | 201 | 183 |
| B4. One-time 30 percent real depreciation in 2016 | 180 | 217 | 217 | 205 | 190 | 185 | 174 | 134 |
| B5. 10 percent of GDP increase in other debt-creating flows in 2016 | 180 | 215 | 216 | 204 | 191 | 187 | 176 | 131 |
Assumes that real GDP growth is at baseline minus one standard deviation divided by the square root of the length of the projection period.
Revenues are defined inclusive of grants.
Senegal: Sensitivity Analysis for Key Indicators of Public Debt, 2015–35
| Projections | ||||||||
|---|---|---|---|---|---|---|---|---|
| 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2025 | 2035 | |
| PV of Debt-to-GDP Ratio | ||||||||
| Baseline | 44 | 43 | 44 | 42 | 39 | 38 | 36 | 26 |
| A. Alternative scenarios | ||||||||
| A1. Real GDP growth and primary balance are at historical averages | 44 | 45 | 47 | 48 | 48 | 50 | 60 | 70 |
| A2. Primary balance is unchanged from 2015 | 44 | 44 | 45 | 44 | 43 | 44 | 46 | 43 |
| A3. Permanently lower GDP growth 1/ | 44 | 44 | 44 | 42 | 40 | 39 | 39 | 34 |
| Authorities’ PSE framework | 45 | 45 | 48 | 48 | 49 | 51 | 38 | 19 |
| B. Bound tests | ||||||||
| B1. Real GDP growth is at historical average minus one standard deviations in 2016-2017 | 44 | 45 | 49 | 48 | 46 | 46 | 48 | 43 |
| B2. Primary balance is at historical average minus one standard deviations in 2016-2017 | 44 | 45 | 48 | 45 | 42 | 41 | 38 | 27 |
| B3. Combination of B1-B2 using one half standard deviation shocks | 44 | 46 | 49 | 48 | 46 | 46 | 46 | 40 |
| B4. One-time 30 percent real depreciation in 2016 | 44 | 53 | 52 | 49 | 46 | 44 | 40 | 29 |
| B5. 10 percent of GDP increase in other debt-creating flows in 2016 | 44 | 52 | 52 | 49 | 46 | 45 | 40 | 29 |
| PV of Debt-to-Revenue Ratio 2/ | ||||||||
| Baseline | 180 | 180 | 182 | 174 | 163 | 160 | 155 | 121 |
| A. Alternative scenarios | ||||||||
| A1. Real GDP growth and primary balance are at historical averages | 180 | 185 | 196 | 198 | 197 | 206 | 254 | 307 |
| A2. Primary balance is unchanged from 2015 | 180 | 181 | 188 | 185 | 180 | 183 | 202 | 199 |
| A3. Permanently lower GDP growth 1/ | 180 | 180 | 184 | 176 | 166 | 165 | 168 | 157 |
| Authorities’ PSE framework | 185 | 203 | 207 | 209 | 209 | 217 | 164 | 79 |
| B. Bound tests | ||||||||
| B1. Real GDP growth is at historical average minus one standard deviations in 2016-2017 | 180 | 187 | 202 | 198 | 191 | 192 | 207 | 195 |
| B2. Primary balance is at historical average minus one standard deviations in 2016-2017 | 180 | 187 | 198 | 189 | 176 | 173 | 165 | 126 |
| B3. Combination of B1-B2 using one half standard deviation shocks | 180 | 188 | 202 | 197 | 189 | 190 | 201 | 183 |
| B4. One-time 30 percent real depreciation in 2016 | 180 | 217 | 217 | 205 | 190 | 185 | 174 | 134 |
| B5. 10 percent of GDP increase in other debt-creating flows in 2016 | 180 | 215 | 216 | 204 | 191 | 187 | 176 | 131 |
Assumes that real GDP growth is at baseline minus one standard deviation divided by the square root of the length of the projection period.
Revenues are defined inclusive of grants.
Senegal: Indicators of Public Debt under Alternative Scenarios, 2015–351/
Citation: IMF Staff Country Reports 2015, 273; 10.5089/9781513518947.002.A002
Sources: Country authorities; and staff estimates and projections.1/ The most extreme stress test is the test that yields the highest ratio on or before 2025.2/ Revenues are defined inclusive of grants.Senegal: Indicators of Public Debt under Alternative Scenarios, 2015–351/
Citation: IMF Staff Country Reports 2015, 273; 10.5089/9781513518947.002.A002
Sources: Country authorities; and staff estimates and projections.1/ The most extreme stress test is the test that yields the highest ratio on or before 2025.2/ Revenues are defined inclusive of grants.Senegal: Indicators of Public Debt under Alternative Scenarios, 2015–351/
Citation: IMF Staff Country Reports 2015, 273; 10.5089/9781513518947.002.A002
Sources: Country authorities; and staff estimates and projections.1/ The most extreme stress test is the test that yields the highest ratio on or before 2025.2/ Revenues are defined inclusive of grants.Conclusion
8. In staff’s view, Senegal continues to face a low risk of debt distress. This assessment, however, hinges critically on (i) a continued reduction of the fiscal deficit; (ii) structural reforms that unlock growth and (iii) prudence in the shift towards less concessional financing. Fiscal reforms should continue and additional fiscal space for PSE-related and social spending should be secured through efforts to increase revenue—particularly collecting tax arrears, freezing public consumption in real terms, and improving the composition of spending. The authorities also need to focus spending on productive areas, working closely with development partners to strengthen project design, preparation and execution while ensuring the overall quality and efficiency of public investment. On the structural side, efforts supported by the World Bank to improve the investment climate need to be pursued.
9. A cautious approach to non-concessional borrowing will similarly be essential for safeguarding debt sustainability. The efforts of the authorities to seek non-concessional financing from the African Development Bank and World Bank are welcome. In addition to being lower cost than Eurobonds, such borrowing could be accompanied by support to ensure that the financing goes to projects that are well prepared and deliver expected economic and social benefits. If these efforts do not yield sufficient financing for the PSE, borrowing from markets should be carefully weighed and proceeds only spent on projects with feasibility studies that indicate positive socio-economic outcomes.
10. The conclusion also hinges on achieving projected growth. The authorities are strongly committed to reforms required for the PSE to succeed. These could lift growth to 7 to 8 percent in the medium term, driven by FDI and SME generated exports. The PSE offers an achievable development strategy, including the right mix of private investment to be crowded in by public investment in both human capital and infrastructure. However, unlocking private investment, including FDI and from SMEs, requires speeding up reforms to the business climate and improving public sector governance. Frontloading public investment without implementing the necessary structural reforms may jeopardize fiscal targets and debt sustainability while failing to raise growth from its sub-par trend. The main risks relate to weak or slow implementation of the reforms, revenue shortfalls that would not allow sufficient mobilization of resources in support of the plan, failure to curb unproductive public consumption, and delays in raising expenditure efficiency, in particular of domestically-financed capital expenditure.
The Senegalese authorities’ new development strategy.
