Senegal is at a critical juncture in its history. The West African nation, which has long grappled with the challenges of an economy driven primarily by raw material exports, is now setting its sights on long-term economic sovereignty. On Monday, the Senegalese government unveiled a comprehensive 25-year economic and social development plan, aiming to transform its economic landscape, enhance governance, and bolster sustainable resource management. This ambitious agenda, launched just seven months after President Bassirou Diomaye Faye’s landslide election victory, underscores the administration’s commitment to delivering on the president’s electoral promise to improve the livelihoods of millions.
As Senegal embarks on this path, the stakes are high. The plan will not only seek to address longstanding economic vulnerabilities but also ensure that the country is well-positioned to compete in an increasingly interconnected global economy. In his remarks at the plan’s launch, President Faye made clear that Senegal’s future must be one of resilience, competitiveness, and innovation.
A Path to Economic Sovereignty
At the heart of the newly unveiled development plan is the goal of economic sovereignty. Faye’s administration envisions a diversified economy that can withstand external shocks while leveraging Senegal’s abundant natural resources for long-term growth and prosperity. This strategy is designed to counter what the president described as the “neutralisation” of the economy—referring to a long-standing model in which Senegal’s raw materials have been exploited with little to no local processing or value addition.
This model, according to Faye, has stifled the growth of the domestic private sector and limited opportunities for the country’s talented youth. In this new paradigm, Senegal’s economic growth will be driven by greater value addition to its natural resources, local industrialisation, and the creation of jobs across various sectors.
Faye’s vision comes at a time when Senegal is becoming an important player in the global energy market. The country became an oil producer in June 2024, with Australia’s Woodside Energy initiating production at the Sangomar oil and gas field. Furthermore, gas production is expected to commence by the end of the year at the Greater Tortue Ahmeyim liquefied natural gas (LNG) project, operated by BP. These developments are seen as crucial to the country’s future energy self-sufficiency, one of the key targets of the new development plan.
The 25-Year Development Plan: Phased Implementation and Key Goals
The 25-year plan will be rolled out in phases, with the first phase scheduled to take place between 2025 and 2029. This initial phase will require an estimated $30.1 billion, to be sourced through a combination of public and private funding, as well as public-private partnerships (PPPs). Key financial metrics for this period include reducing the budget deficit to 3% of GDP, down from the current 4.9%, and increasing the average tax burden to 21.7%.
The plan is based on an anticipated average growth rate of 6.5%, though it faces headwinds. In September 2024, the International Monetary Fund (IMF) lowered Senegal’s growth forecast to 6.0% for the year, down from an earlier projection of 7.1%. This revision was due to slower-than-expected economic expansion in the first half of the year, underscoring the challenges that Senegal faces in achieving sustained growth in the near term.
However, the government remains optimistic about its long-term prospects. In addition to reducing the budget deficit, the development plan aims to increase access to electricity to 100%, up from the current 84%. This goal is critical for both economic growth and social development, as reliable access to energy is a fundamental requirement for businesses, schools, healthcare facilities, and households alike.
The plan also emphasizes good governance and the sustainable management of resources. Early in his presidency, Faye initiated an audit of oil and mining contracts, signaling his administration’s commitment to transparency in resource management. While details of the audit have not been made public, the move reflects broader efforts to ensure that Senegal’s newfound oil wealth benefits the population rather than being siphoned off through corruption or mismanagement.
Tackling Senegal’s Debt and Financing Challenges
One of the most pressing issues facing the government is Senegal’s national debt. The new administration plans to modify the country’s deficit financing structure as part of the development plan, seeking to reprofile the national debt in order to make it more sustainable. The precise nature of these modifications has yet to be fully outlined, but they are expected to focus on reducing the debt burden while ensuring that financing for key infrastructure and social projects remains intact.
Despite the ambitious nature of the plan, there are concerns that Senegal’s economic challenges could hinder its successful implementation. The IMF has raised alarms about a significant decline in government revenue during the first eight months of 2024, and some worry that upcoming political events, such as the snap legislative election scheduled for November 17, could further delay critical financing. The election is particularly important given that Faye’s Pastef party had only 26 seats in the recently dissolved 165-member parliament, limiting its ability to pass key legislation.
Political Context: Addressing the Youth and Parliament
Much of Faye’s electoral success in 2024 was driven by the disenfranchised urban youth, who remain a critical demographic for his administration. Many young Senegalese face limited employment prospects and have been frustrated by the country’s economic stagnation. The new development plan aims to create jobs and expand opportunities, particularly in sectors like energy, agriculture, and technology. However, the administration must act quickly to maintain the support of these voters, who are eager for concrete progress.
Faye’s government has also had to navigate political resistance, particularly in the national assembly. Frustrated by a lack of legislative support, Faye dissolved parliament in October, paving the way for the upcoming legislative elections. The new parliament will be essential to the success of the development plan, as it will need to approve the funding and legislative changes necessary to implement the various initiatives. Faye’s ability to secure a majority in the new legislature will be a key determinant of his administration’s ability to deliver on its promises.
Challenges and Opportunities Ahead
Senegal’s 25-year economic and social development plan presents a bold vision for the future, but it is not without its challenges. The country’s reliance on international financing and its vulnerability to fluctuations in global commodity prices could complicate efforts to achieve the plan’s ambitious goals. Moreover, the political uncertainty surrounding the upcoming election and the potential for delays in securing IMF financing add an additional layer of complexity.
Nonetheless, the opportunities for Senegal are immense. The country’s burgeoning energy sector, coupled with its strategic location and abundant natural resources, provides a solid foundation for long-term growth. By focusing on value addition, industrialisation, and good governance, Faye’s administration hopes to turn these opportunities into tangible benefits for all Senegalese.
In the years to come, the success of this plan will be measured not only by GDP growth and budgetary metrics but also by the extent to which it improves the everyday lives of Senegal’s citizens. If Faye’s government can navigate the political and economic challenges ahead, Senegal could very well emerge as a model for sustainable development in West Africa.
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