The government of Senegal is implementing budget cuts worth hundreds of billions of CFA francs to maintain public account equilibrium. This decision comes amid underperformance of the Economic and Social Recovery Plan (PRES), whose expected revenues fell short of targets. The executive, led by Prime Minister Ousmane Sonko, now seeks to close a budget gap that directly threatens the fiscal trajectory set at the start of the fiscal year.
PRES revenue falls short of expectations
Hailed as the backbone of the new administration’s fiscal consolidation strategy, the PRES was intended to raise additional funds to reduce the inherited deficit and finance the government’s social priorities. But early accounting data tells a different story. Tax and non-tax revenues scheduled under this plan face a worrying delay, weakening the macroeconomic assumptions underpinning the current budget law.
The shortfall forces tough choices. Rather than widening the deficit or resorting heavily to new borrowing in an environment where debt costs have risen sharply, Senegal’s authorities have opted for austerity. Hundreds of billions of CFA francs in expenditure authorisations are now frozen or scrapped across several ministerial lines to realign spending with actual revenue.
Tight budget balance in Dakar
The internal warning is clear: without immediate correction, the budget balance would be at risk. This phrase, echoed in framework documents, underscores the urgency of a response. Senegal has committed with its multilateral partners, foremost the International Monetary Fund, to meet strict deficit targets under the programme agreed with Washington. Any slippage 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 gross domestic product, a convergence standard regularly enforced by community institutions. Revelations in September 2024 by the Court of Auditors about the real scope of public debt had already prompted the country to renegotiate ties with donors. The announced cuts continue this process of fiscal alignment.
High-stakes political decisions for Sonko
For the executive duo of President Bassirou Diomaye Faye and his Prime Minister, the exercise is delicate. Elected on promises of economic change and tangible improvements in living conditions, they must reconcile fiscal orthodoxy with strong social expectations. The cuts will affect investment spending, easier to postpone than operating costs, but also some transfers. Several ministries could see their budgets slashed to levels unprecedented in recent years.
The chosen path carries political risk. Reducing infrastructure credits or sectoral subsidies in a country just emerging from a period of institutional instability could fuel discontent. On the other hand, letting the deficit widen could hasten a downgrade of Senegal’s sovereign rating, already under watch by agencies. Moody’s and S&P Global Ratings are closely watching the government’s ability to keep its fiscal promises.
Timing is another issue. The announced cuts must take effect before the year-end close, which requires swift execution of freeze circulars and strict discipline among spending authorisers. Oversight will fall mainly on the Ministry of Finance and Budget, in close coordination with the Prime Minister’s office. The ability to rebuild revenues in 2025, through more effective tax reform and better domestic resource mobilisation, will determine the length of this austerity period.
Beyond the immediate shock, this new episode highlights the narrow margin of manoeuvre Senegal truly has to fund its economic transformation ambitions. The decisions cover hundreds of billions of CFA francs and explicitly aim to preserve budget balance threatened by PRES underperformance.
