Senegal’s public debt climbed sharply by end-March 2025, data from the finance ministry showed, underlining the government’s struggle to balance spending with revenue generation amid persistent fiscal challenges.

Debt servicing costs soared 44.5% year-on-year in the fourth quarter of 2024 to reach 822.32-billion CFA francs ($1.4-billion), and grew by 23.98% in the first quarter of 2025 compared to the same period last year, reflecting growing obligations tied to domestic and external liabilities.

Two-thirds of the debt is owed to banks and the remainder tied to operational arrears, including unpaid supplier bills and taxes, according to the delayed quarterly budget execution reports which were published Monday.

The reports show Senegal mobilised 1,027.82-billion CFA francs in revenue in the first quarter of 2025, representing 21.44% of annual budget targets, while expenditures reached 1 419.45-billion CFA francs, covering day-to-day spending and capital investments.

External grants fell sharply by 71.49% year-on-year to 8-billion CFA francs, underscoring the difficulties of attracting donor funding.

Senegal’s government reiterated its commitment to managing debt and pursuing fiscal reforms, but challenges in external funding, rising debt servicing costs, and arrears remain significant hurdles for the West African nation.

The International Monetary Fund (IMF) froze disbursements on its programme with Senegal last year after the nation admitted it had misreported debt and deficit data. The IMF, whose financing is seen as key for the West African nation and serves as an anchor for other investment and funding, has said no talks on a new arrangement can start until the case is resolved.

A review of government finances by Senegal's court of auditors in February found Dakar had understated its deficits by up to seven percentage points of GDP a year, pushing the end-2023 debt ratio to about 100% of GDP versus the 74% the previous government had reported.

Numbers for the last quarter of 2024 showed stronger revenue performance, with mobilisation of 4,005.21-billion CFA francs, exceeding revised forecasts by 3.91%. Expenditures totalled 6,506.16-billion CFA francs, marking a 61.29% year-on-year increase.

However, the period also highlighted significant arrears, including 146.3-billion CFA francs in energy subsidies and 105.2-billion CFA francs owed to construction contractors.