Senegal’s economy has seen record growth, reaching an 8.9% increase in Q3 due to oil exports. The IMF anticipates a 9.3% growth next year. The export of gas from BP’s project is expected to further boost the economy. Efforts to address a significant budget deficit are underway, with an aim to reduce the deficit to 3% of GDP by 2027.
Senegal has experienced a remarkable economic growth rate, achieving a record surge in the third quarter, driven by its commencement of oil exports. The International Monetary Fund has projected a further expansion of 9.3% for the next year. According to the National Agency of Statistics and Demography, the nation’s gross domestic product (GDP) increased by 8.9% from the previous quarter and grew by 11.5% compared to the same period last year.
As Senegal prepares to start exporting liquefied natural gas from BP Plc’s Greater Tortue Ahmeyim project, further economic growth is anticipated. The Secretary-General of the Energy, Petroleum and Mines Ministry, Cheikh Niane, indicated that the first gas exports are expected to begin early next year. Mark Bohlund, a senior credit research analyst, noted, “First gas from the GTA project should give another growth spurt in first quarter 2025 but economic growth is likely to settle at a lower rate after this.”
This economic expansion presents an opportunity for Senegal to address its public finances, especially as the country expects a budget shortfall of over 11% of GDP for the current year. The performance of the nation’s dollar bonds has remained stable, with certain securities showing minor increases in value. Prime Minister Ousmane Sonko has stated that there are plans to reduce the budget deficit to 3% of GDP by 2027 through cuts in government spending and improved tax collection.
Since June, Woodside Energy Group Ltd., the largest oil and gas producer in Australia, has initiated its first oil production at the Sangomar project located offshore Senegal, contributing to the nation’s burgeoning economy. The forward trend in economic growth combined with the anticipated oil and gas exports positions Senegal favorably for financial recovery and growth in the coming years.
In summary, Senegal has experienced unprecedented economic growth fueled by its recent oil exportation and the anticipated gas exports from the Greater Tortue Ahmeyim project. Although the nation is facing budgetary challenges, plans are in place to stabilize the fiscal situation. With projections indicating a strong future growth rate, Senegal is strategically positioned for continued economic advancement.
Original Source: www.energyconnects.com
