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Senegal's Economic Growth To Pick Up Momentum This Year: IMF

272 days ago

(RTTNews) - Senegal's economic growth is set to gather momentum this year and the next, helped mainly by investments in infrastructure and industrial projects and a further recovery of the agricultural sector, a report from the International Monetary Fund (IMF) said Friday.

The report, published following a review meeting, said growth is estimated to accelerate to 3.7 percent this year from 2.6 percent in 2011. In 2013, the economy is forecast expand at a faster rate of 4.3 percent, supported mainly by major projects being implemented in the electricity and road sectors, the continued recovery of the agricultural sector and new industrial projects.

The country's inflation is seen staying below 2 percent in the coming months and remaining contained around 2 percent in 2013.

Meanwhile, a sharp rise in imports relating to food and petroleum products could lead to an increase in current account deficit this year. The government has maintained its budget deficit target for 2012, and plans to reduce the shortfall to less than 5 percent of GDP in 2013 to ensure fiscal sustainability, the lender said.

The report, meanwhile, cautioned that the external environment is expected to remain weak. Despite a modest acceleration of the global economy expected in 2013, high petroleum product prices, rising cereal prices, and sociopolitical tensions in the sub-region will continue to affect economic activity, the external accounts, and public finances in Senegal.

"In the medium term, the key challenge for Senegal is to return to strong, sustainable, shared growth. The government has an important role to play in the process, for instance, through the development of essential infrastructure, reforms to improve the business climate, and appropriate social policies" Hervé Joly, head of the IMF mission to Senegal, said.

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