Mouhamed Dia (Expert) : «Les grands enseignements des conclusions de la mission du Fmi…»
The International Monetary Fund (IMF) has just completed its mission to Senegal, amidst a highly strained fiscal climate. The Bretton Woods institution unveiled the key findings of its discussions with Senegalese authorities on Tuesday, August 26. Financial expert Mouhamed Dia outlines these findings for us in this interview with Seneweb.
What major lessons can be drawn from the conclusions of the IMF mission to Senegal?
All IMF programs have almost the same goal: to send clear signals to donors, creditors, and the general public about the soundness of a country's economic policies. In a way, member countries use the IMF's name to gain credibility with lenders. The IMF acts as a financial buffer. It is not in the IMF's interest for its program to fail in the countries it helps, so as not to create a bad image among donors. Thus, the IMF corroborates what economists had already established: the manipulation of public finances by the old regime through unorthodox mechanisms and spending without budgetary cover.
The IMF has decided to support Senegal in the following four areas: strengthening budget transparency and public financial management, supporting the revival of strategic sectors, developing human capital and social equity, and strengthening resilience to climate shocks. The two main programs are: the Economic Policy Support Instrument (EPI), which aims to help member countries maintain or consolidate macroeconomic stability and debt sustainability, while deepening structural reforms in key areas where constraints affect growth and poverty reduction. There is also the Economic Policy Coordination Instrument (EPI), an instrument introduced by the IMF in 2017 that serves to strengthen macroeconomic stability by maintaining fiscal sustainability and prudent debt management. In any case, given the circumstances, it is wiser to sign a program with the IMF in order to be able to mobilize resources for adequate recovery before the implementation of the recovery plan.
Will the IMF's conclusions and "congratulations" to the Senegalese authorities be enough to restore donor confidence in Senegal?
Undeniably, this is helping to gradually restore donor confidence. But it is now our responsibility to determine the path we wish to take regarding the allocation of the resources mobilized. It must be recognized that Senegal is a poor, heavily indebted country, with insufficient internal resources to cover its expenses. This has forced us, every year, to incur excessive debts, due to the lack of viable alternatives. Inappropriate debt decisions have emerged over the past decades, the consequences of which are now being manifested.
Under the Republicans, there was a desire for a structural transformation of the economy and several achievements were made, even if some were not timely or were poorly negotiated. Following many major achievements during the seven-year term of the Republicans, a succession of crises emerged during the five-year term, which generated a considerable cost for Senegal, requiring increased recourse to debt in order to cope with these difficulties and avoid a recession. This massive indebtedness, untimely during the seven-year term and obligatory during the five-year term, plunged Senegal into a black hole.
Growth climbed to 12% in the first quarter thanks to crude oil. But the IMF is concerned about non-hydrocarbon growth of 3%. What is your analysis of these two aspects of growth?
We confuse economic growth with development. Growth is nothing more than the accumulation of wealth. Development is the improvement of the quality of life. We are a poor country. We must therefore build our nation on solid foundations—health, education, access to clean water—rather than burying billions that have almost no return on investment. Let us seriously develop our agriculture, which can create a ripple effect in other sectors of the economy.
In a perfect world where everything is predictable, this continuous double-digit growth rate should be able to reduce poverty, but there are always exogenous shocks to consider. To deal with exogenous shocks, it is important that debt is well structured, whether it be interest rates, denominated currencies, and/or maturities, among others. The state must ensure that there are not too many short-term or variable-rate loans, as this can affect the budget. While there is a positive correlation between oil rent and economic growth, what we are seeing in Africa is that this rent creates a counterproductive phenomenon.
How ?
This income creates strong growth, which unfortunately is not always inclusive. The oil surplus has not always generated the desired economic development. It is essential to recognize that oil income will increase the country's wealth, and therefore its GDP, but if we focus on non-hydrocarbon growth, we feel that production is the determining factor in this ratio.
The conclusions of the Forvis Mazars audit place the debt stock at 111% of GDP at the end of 2023 and at 118.8% at the end of 2024. What lessons can be drawn from this?
If we were to consider the country as a business, we could say that it would have gone bankrupt. However, given that states do not experience bankruptcy, this comparison is appropriate to highlight the seriousness of the current situation. This means that the state no longer has any fiscal room for maneuver and will be unable to raise funds for investment. The current mode of operation is the result of the damage caused by the previous regime.
The IMF wanted to keep Senegal waiting until the conclusion of the public finance audit in order to put in place a program that would allow for the disbursement of funds. If Senegal is in this current situation, it is partly due to the budgetary indiscipline of the seven-year Republican term, combined with the crises of the five-year term and the hidden debt. Public finances were not cleaned up, and there were many tax exemptions. And this was one of the problems with the IMF. For example, for the economic zones of Diamniadio and Diass, the IMF had bluntly warned the government that for these zones, tax exemptions had to be stopped or eliminated on a case-by-case basis. The subsidies were a burden for Senegal, and the biggest problem was Senelec (250 billion CFA francs were paid to Senelec and 70 billion to SAR). The government, having no other choice because of the crises, had to go into massive debt, and rightly so, and that is why they were forced to disguise public finances in order to benefit from these loans to avoid the worst.
The new rulers took the risk of revealing everything...
The current government chose to tell the truth to multilateral partners in order to start on a new, solid foundation, and this came at a cost (a downgrade of the country's rating), even though I think it was the right thing to do, because sooner or later, the IMF would realize it, and the consequences would be much more disastrous. Growth during the Republicans' seven-year term broke all records for our country, but this growth was unable to reduce poverty or impact the human development index in general. The reason is none other than that the resources mobilized were allocated to public investments in infrastructure that were managed by foreign companies. The wealth created is unfortunately not reinvested in our country, but rather repatriated to the metropolises.
This belief that public investment in infrastructure such as roads and highways is an essential driver of economic growth has always strongly influenced the decisions of leaders in developing countries. According to studies, this type of growth model, which relies on public investment, is slow and does not reduce poverty. Some economists have instead advised minimizing the importance of the public sector and infrastructure by prioritizing human capital and reforms, especially good governance.
Senegal can embark on infrastructure construction through public-private partnerships, which is nothing more than a financing method implemented by private service providers who, in turn, manage the infrastructure. The financial structure is designed so that the expenses are not included in the budget because they are operating expenses rather than capital expenditures. Payment will be made either in the form of rent or revenue from operating the infrastructure. This financing method certainly has advantages, but also very disastrous disadvantages.
We are seeing the use of public-private partnerships for infrastructure construction around the world, particularly in Africa. When a government is short of money, this financing mechanism has become increasingly popular. For a country like China, infrastructure was a key element in their development, as it grew and ultimately generated revenue to pay off debt. However, for Spain, this was not a success. Spain built highways that no one uses, airports that are not used at all. As a result, tax revenues to repay debts were not available. The main reason governments resort to public-private partnerships is the lack of resources for infrastructure construction.
Now, what or how to do with such a level of debt?
It is inconceivable that a country can remain poor while claiming to be emerging. In the development process, it is first necessary to escape poverty before discussing any notion of emergence. For many years, Senegal has remained among the countries with the lowest human development indices. Various programs have been implemented, but none of them have succeeded in promoting Senegal's development. This framework proves pragmatic by taking into account the public finance situation marked by a significant budget deficit. It will first be necessary to restore public finances and restructure the debt to guarantee us a sufficiently comfortable fiscal space in the future.
Now with the Senegal 2050 framework, it is important to know that in theory, this project is excellent, given that Senegal has massively indebted itself and this reduces budgetary maneuvers. However, we must be positive and take the time to communicate well with bilateral and multilateral partners in order to find short-term and long-term solutions in order to mobilize resources and, above all, to allocate them well. We must think about the future and put aside the past while learning from the mistakes made. We must think micro at this time, because we do not have the possibility of going into massive debt in order to implement projects that will develop Senegal.
For example, instead of trying to build certain roads immediately, we can build infrastructure in territorial hubs. Place industrial parks alongside specialized suppliers. The state has seen that exogenous shocks destabilize us, and we must necessarily put in place a mechanism to deal with these shocks. A fund must also be set up for a possible electricity subsidy in the event of a rise in the price of a barrel of oil.
Commentaires (13)
Pertinent
EXPERT, il faut décliner d'abord pourquoi il l'est et en quoi, nous dire qu'il est diplômé de quoi de quelle université et écoles supérieures à tel degré ce qu'il fut et ses occupations actuelles etc pour qu'on puisse écarter un plagiat d'abord et surtout avoir foie en ce texte en y voyant une contribution positive d'un sachant dans ce débat sur les rapports entre le Sénégal et le Fond Monétaire International (FMI).
Pertinent vous dites? Laissez-moi rire! Beaucoup trop de contradictions dans cette analyse!
A vendre calculatrices programme français sur expat dakar
Il y'a une grande difference entre chiffres errone/erreurs, comme decris par le FMI et dettes cahees et faux chiffres, divulgues publiquement par Ousmane Sonko. Ce sont des declarations qui ont coute au Senegal des emprunts a un taux eleve de 7 a 8%, et a un delai court de 3 ans. Voila ce qui arrive quand on donne le pays a des apprentis et tatonneurs.
Bonne analyse !
J'ajouterai qu'il faut necessairement réduire le train de vie de l'Etat avec un objectif clair. On pourrait par exemple réduire les hauts salaires de 30% en 2026 et supprimer certains avantages non justifiés, valoriser le patrimoine de l'Etat.
Trop d experts au senegal et pourtantle senegal est toujours pauvre
Un remaniement en téléchargement. Tous les théoriciens sortent de leur trou à qui mieux mieux. Histoire de trouver une sinécure. On a tout compris.
Il faut qu'il se dirige plus pour les questions financières et économiques qu'ailleurs . Enfin une excellente analyse après tous ce que les apprentis mécaniciens d'économistes nous balancent tous les jours.
Bravo. Très pertinent
C est le sérieux, l honnêteté, l empathie qui pourront nous faire progresser.
Au delà des propositions faites par l expert, nos Autorités auraient pu réduire de manière drastique les fonds politiques ou caisses noires. Tant que cela n est pas fait, nos Autorités ne pourront pas les citoyens.
Ensuite, réduire les gros salaires et certains avantages, supprimer les cumuls d avantages..
Lorsque ce régime tombera ce Mohamed DIA nous rendra des comptes sur les eurobonds de mai 2024
Si le Sénégal est dans cette situation actuelle, cela est en partie dû à l’indiscipline budgétaire du septennat des Républicains, conjuguée aux crises du quinquennat et à la dette cachée (SIC). Complètement faux! C'est ce qu'un point de vue partisan veut retenir en post analyse.
Toutes les économies jouent avec des variables pour présenter leurs états financiers sous de meilleurs jours sans que cela ne soit une manipulation délictueuse. Cette stratégie est officieuse et les bailleurs le savent. La situation actuelle est due à un incompétent pleurnichard et revanchard porté par son envie folle de discréditer et qui cherche à justifier qu'il est incapable. Tous les régimes nouveaux au Sénégal ne trouvent aucun sou quand ils arrivent au pouvoir. Ils constatent, relèvent les manches et font ce qu'ils peuvent. Le régime actuel a eu la chance d'hériter beaucoup de réalisations. Il fallait juste continuer le travail.
Le FMI ne décaissera pas ou le fera le plus tardivement possible étant donné que les élections vont arriver dans presque 3 ans. Les bailleurs ne nous font plus confiance car rien ne leur garantit que les déclarations que nous ferons dans le futur ne seront pas maquillées. C'est toujours la même administration sénégalaise non ! À moins d'auditer par une firme tierce après chaque déclaration ! Ce qui serait une vraie humiliation pour notre pays!
Il ne parle même pas du train de vie de l’état et des agences à floison qu’il faudra supprimer et même supprimer AIR Sénégal qui est un gros gouffre financier.
Ce qui paraît pertinent dans la théorie l‘est moins dans la pratique!
Un exemple simple: il dit „ au lieu d’essayer de construire certaines routes dans l’immédiat, nous pouvons construire des infrastructures dans les pôles territoriaux. Mettre les parcs industriels à côté des fournisseurs spécialisés.“
Ok, on met les parcs industriels sans routes. Comment transporter donc les matières premières et produits industriels finis? Sur des sentiers sablonneux exposés p.e. aux eaux de pluie? Quel manque de vision. D’ailleurs, c‘est pourquoi il nous dit d’agir micro. Laissez-moi rire! On ne développe pas un pays en agissant micro! Voila nos experts qui retardent le développement de l’Afrique. Moi qui faisait Dakar-Thies en pas moins de 2 a 3 heures il n‘y a pas si longtemps, je mesure la pertinence de la rentabilité socioéconomique des nouvelles infrastructures. Maintenant le même trajet me coûte maximum 45 minutes. Quand cet expert nous parle de l’amélioration de la qualité de vie. Dakar-Thies en 35-45 minutes sur une autoroute bien moins dangereuse de nos routes dites nationales , Voila une bien réelle amélioration de ma qualité de vie!
Beaucoup trop de contradictions dans cette analyse!
TOI KOMPRENDRE ?
le Sénégal demeure parmi les pays affichant les indices de développement humain les plus faibles
@Malal.....tu es le bled des charrettes !!
Malal t‘a bien touché hein
Participer à la Discussion