Senegal releases its 25-year plan for social and economic development

The government of Senegal announced a 25-year growth plan on Monday, claiming that it would establish the groundwork for economic sovereignty through excellent governance, sustainable resource management, and competition.

The agenda was introduced seven months after West African President Bassirou Diomaye Faye won a resounding electoral victory on a platform of raising living standards.

A month before a snap legislative election, Faye stated during the opening event, “Our goal is to create a resilient and diverse economy.”

“Our … economy has been neutralized by a model of exploiting raw materials without any significant local processing or valorization, leaving our domestic private sector too weak … and our young talent in desperate search of opportunities,” according to him.

With the opening of a new tab for production at its Sangomar oil and gas well in June, Australia’s Woodside Energy (WDS.AX) made Senegal an oil producer. By the end of the year, gas production is also anticipated to start at BP’s (BP. L) Greater Tortue Ahmeyim liquefied natural gas project.

The authorities have not disclosed the status of the audit that Faye started early in his presidency to examine mining and oil contracts.

During the first phase of the economic plan, which will cost $30.1 billion and span from 2025 to 2029, the budget deficit will be reduced from 4.9% to 3% of GDP.

It will be financed through a combination of private, governmental, and public-private partnership sources. Its assumptions include an annual growth rate of 6.5% and an average tax burden increase reaching 21.7%.

Following a slower-than-expected pace of economic expansion in the first half, the International Monetary Fund lowered Senegal’s growth prediction from 7.1% in June to 6.0% in September.

The government’s new plan is to make Senegal energy self-sufficient and expand access to electricity from 84% to 100%.

To reprofile the national debt, the new government will also alter Senegal’s deficit finance system.

The disadvantaged urban youth who supported Faye and helped propel him to office have been pressuring him to fulfill his electoral pledges.

Due to opposition from the national assembly, the president dissolved parliament last month in order to hold a snap legislative election on November 17. With just 26 seats in the 165-member parliament that has since been disbanded, his Pastef party had little clout.

There are worries that the election may cause a delay in IMF financing, as the IMF reports that government revenue dropped sharply in the first eight months of the year.