Senegal: Staff Report for the 2001 Article IV Consultation, First Review Under the Third Annual Arrangement Under the Poverty Reduction and Growth Facility, and Request for Waiver of Performance Criteria

IMF Staff Country Reports, October 24, 2001

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Canonical URL: Senegal: Staff Report for the 2001 Article IV Consultation, First Review Under the Third Annual Arrangement Under the Poverty Reduction and Growth Facility, and Request for Waiver of Performance Criteria

Faced with a tight liquidity situation at the treasury, the government of Senegal has implemented a tight spending regime to avoid a substantial drawing on the statutory advances at the Central Bank of West African States (BCEAO).
Weaknesses in accounting for public funds, as well as the delays in structural reforms, have had fiscal repercussions.
Credit growth has reflected the financing needs of the agricultural sector and the buildup of arrears in the energy sector.
Recent developments have exacerbated the risk concentration problem in the loan portfolio of the local banking system.

Fiscal policy: Tight spending regime adopted to contain treasury liquidity pressures and avoid substantial use of BCEAO statutory advances.
Public financial management: Weaknesses in accounting for public funds are creating fiscal repercussions and complicating fiscal control.
Structural reforms: Delays in implementing structural reforms are contributing to fiscal stress.
Financial sector risks: Credit growth tied to agricultural financing and energy sector arrears has increased risk concentration in local bank loan portfolios.

Subjects: Agricultural commodities, Bank credit, Banking, Commodities, Credit, Expenditure, Fiscal policy, Fiscal stance, Money
Keywords: Agricultural commodities, audit report, Bank credit, CR, Credit, financial situation, Fiscal stance, groundnut company, ISCR, PRGF arrangement, sound PRSP, Sub-Saharan Africa, West Africa