Ratings agency Moody’s on Friday downgraded Senegal’s long-term ratings to B1 from Ba3, citing significantly weaker fiscal and debt position than expected.
Senegal is in talks with the International Monetary Fund (IMF) for corrective measures after an audit ordered by newly elected President Bassirou Diomaye Faye revealed the 2023 budget deficit is over 10%, compared to the 5% reported by the previous administration.
As a result of the audit, Faye’s government decided not to table the country’s request for an IMF disbursement in July following the fund’s review in June.
“We expect fiscal consolidation to be a protracted process, notwithstanding the strong improvement to economic growth expected in 2025,” Moody’s said in its report.
Moody’s has also placed Senegal’s long-term ratings “on review” for a follow-up downgrade.
Reuters
