The government of Senegal is implementing budget cuts totalling several hundreds of billions of CFA francs to maintain the balance of public accounts. This decision comes as the Economic and Social Recovery Plan (PRES) falls short of its expected revenue targets. The administration led by Prime Minister Ousmane Sonko is now working to close a budgetary gap that threatens the fiscal trajectory set at the start of the fiscal year.
PRES underperforms on revenue forecasts
Hailed as the backbone of the new government’s fiscal consolidation strategy, the PRES was designed to mobilise additional resources to reduce the inherited deficit and fund social priorities. Yet initial accounting reports tell a different story. Tax and non-tax revenues programmed under this plan are showing worrying delays, undermining the macroeconomic assumptions behind the current finance law.
The shortfall forces difficult trade-offs. Rather than deepening the deficit or resorting heavily to new borrowing amid rising debt costs, Senegalese authorities have chosen the path of austerity. Specifically, hundreds of billions of CFA francs in spending authorisations are being frozen or cancelled across several ministerial lines to realign outflows with actual inflows.
Fiscal balance under pressure in Dakar
An internal warning is clear: without immediate correction, the budget balance would be threatened. The phrase, echoed in framing documents, underscores the urgency of a response. Senegal has committed to strict deficit targets under its programme with multilateral partners, notably the International Monetary Fund. Any deviation would jeopardise future disbursements and make access to international financial markets more expensive.
The regional context also weighs heavily. Within the West African Economic and Monetary Union (UEMOA), Dakar must keep the public deficit below 3% of GDP, a convergence norm regularly enforced by community institutions. Revelations in September 2024 by the Court of Auditors about the true scale of public debt had already forced the country to renegotiate its relationship with lenders. The announced cuts are a continuation of this accounting alignment.
Political trade-offs with high stakes for Sonko
For the executive tandem of President Bassirou Diomaye Faye and his Prime Minister, the exercise is delicate. Elected on promises of economic rupture and tangible improvements in living conditions, they must reconcile fiscal orthodoxy with strong social expectations. The cuts will inevitably affect investment spending, which is easier to postpone than operational spending, but also certain transfers. Several ministries are set to see their budgets slashed to an extent unprecedented in recent years.
The chosen trajectory carries political risk. Reducing infrastructure credits or sectoral subsidies in a country emerging from a period of institutional instability could stoke discontent. Conversely, letting the deficit widen would expose Senegal to a rapid degradation of its sovereign rating, already under watch by agencies. Moody’s and S&P Global Ratings are closely monitoring the government’s ability to keep its fiscal promises.
Then there is the question of timing. The announced cuts must take effect before the end of the fiscal year, requiring swift implementation of freeze circulars and firm discipline by spending authorisers. Oversight will primarily fall to the Ministry of Finance and Budget, in close coordination with the Prime Minister’s office. The ability to rebuild revenues in 2025 through more efficient tax reform and better domestic resource mobilisation will determine how long this austerity cure lasts.
Beyond the immediate shock, this latest episode illustrates the narrow room for manoeuvre that Senegal truly has to finance its economic transformation ambitions. The adjustments involve hundreds of billions of CFA francs and are explicitly aimed at preserving the budget balance threatened by the PRES underperformance.
