The prime minister calls the IMF’s planned debt restructuring for Senegal a “disgrace”
The West African nation is opposing the International Monetary Fund’s request that Senegal restructure its debt, calling it “a disgrace,” Senegalese Prime Minister Ousmane Sonko said during a protest in the capital, Dakar.
After Senegal’s then-new leaders revealed undisclosed debts that have now swelled to over $11 billion, the IMF suspended the country’s previous $1.8 billion credit program last year. The IMF concluded its trip to Senegal on Thursday without agreeing on a new lending program.
Requests for comment were not immediately answered on Sunday by the IMF, Sonko’s spokesperson, or the finance ministry of Senegal.
Senegal is opposed to restructuring.
At a rally for the ruling Pastef party on Saturday, Sonko restated President Bassirou Diomaye Faye’s accusation that his predecessor Macky Sall was responsible for the hidden debt crisis.
“What the IMF is proposing is a restructuring of this abysmal debt that Macky Sall’s party has burdened us with,” he stated. “What we told our partners is that we don’t want a restructuring because it would be a disgrace for Senegal.”
Senegal would be implied to be a poor student who borrowed money with the intention of stealing. We reassured them that the Senegalese people will rise to the challenge and assume responsibility, and that this nation is one of pride and dignity.”
IMF Says Discussions Will Go On
Sonko’s reference to a restructuring of either domestic or foreign debt, or both, was not quite apparent.
According to IMF estimates, the entire public sector debt, including state-owned businesses, was 132% of GDP at the end of the previous year. This amount included 4% in arrears for domestic expenditures.
Edward Gemayel, the mission chief, assured reporters that Senegal was committed to paying off its obligations and that negotiations would continue in the upcoming weeks.
Gemayel added that the necessity of a restructuring would be ascertained via a debt sustainability review, which is already underway.
However, Senegal would need to take action to put its debt on a sustainable path in accordance with IMF guidelines in order to receive Fund funding.
Sonko promised to finance 90% of the effort with domestic resources and steer clear of more debt when he launched a new economic recovery strategy for Senegal in August.
