Facing the Atlantic Ocean from the westernmost part of Africa's Sahel, Senegal borders Gambia, Guinea, Mali, and Mauritania. One of West Africa's key political and economic hubs, Senegal has a population of about 15.4 million (2016), at least 23% of it concentrated around Dakar, and 40% in other urban areas.
Senegal has been one of the most stable countries in Africa. Its current President, Macky Sall has been elected in Marche 2012. In 2016, its political system was strengthened by a constitutional referendum that slashed presidential mandates from 7 to 5 years. A fractured opposition contributed to a recent victory in legislative elections in June for President Macky Sall's ruling coalition Benno Bokk Yakaar party, the BBY ("United in Hope" in the widely-spoken Wolof language), with 125 out of 165 seats, despite narrowly failing to get a majority in the popular vote (at 49.5%). In addition to the BBY, 12 political coalition and single parties have seats in the national assembly, including Coalition gagnante Wattu Senegaal (19), Manko Taxawu Sénégal (7), and Parti de l’unité et du rassemblement (3).Parti de l’unité et du rassemblement (3).
After decades of very modest growth, particularly from 2007 to 2013, in 2014 the Government of Senegal adopted the new Plan Senegal Emergent (PSE) designed to help the country get out of a cycle of low-growth and weak poverty reduction. Greater competitiveness, punctual progress in structural reforms, and a favorable external environment all mean economic growth has recently accelerated, reaching about 6.5% in the past 2 years and making Senegal one of the best performing economies in Sub-Saharan Africa. Almost three quarters of the 2015/16 higher growth (compared to the low growth period of 2005–2013) is due to a higher contribution from exports, whose volumes increased by almost 15% and 13% in 2015 and 2016 respectively, underpinned by a more diversified base in agriculture, fishing, and mining. Higher consumption accounted for around 10% of the higher GDP growth, reflecting the positive effect on national income of both a good harvest and improving terms of trade (lower prices for energy and food imports). At a sectoral level, the higher growth in both years was mainly attributed to larger contributions from the agriculture and industrial sectors. In short, Senegal's recent uptick in economic growth reflects stronger international competitiveness, incipient structural changes and, to a lesser extent, favorable exogenous factors, such as positive terms of trade favorable climatic conditions. Other macroeconomic indicators are showing positive trends, although public debt is trending upwards. The fiscal deficit also narrowed in the last few years, to 4.8% of GDP in 2015 and 4.2% in 2016. It is expected to settle at 3% in 2018, thus complying with ECOWAS's convergence commitment before the 2019 deadline.
Senegal's medium-term economic prospects are positive for as long as its new structural reforms are sustained and deepened, and the external environment remains benign. Economic growth is projected at reaching 6.8% and 6.9% in 2018, and the PSE economic blueprint for becoming a middle-income country targets even more ambitious growth rates of between 7.6% and 8.3% from 2016 to 2018. To accelerate Senegal will need all its drivers of economic growth pointing in the same direction at the same time. This means more reforms to solve critical bottlenecks in the country's productivity and competitiveness; sustaining a credible fiscal policy and avoiding currency overvaluation; and benefiting from a positive international environment.
Although there is a lack of updated data, recent projections indicate that progress in poverty reduction has been rather modest, and that Senegal continues to display high rates of monetary poverty. Simulations based on the evolution of per capita GDP suggest that poverty may have decreased by 3% to 6% from 2011 to 2015, driven by improvements in rural areas and agricultural expansion. Data on employment suggest that some reallocation out of agriculture took place in rural areas, which might have further contributed to poverty reduction. But non-monetary evidence suggests that inequality has stagnated. Social indicators and outcomes have been generally positive, although slow and uneven.
Last Updated: Oct 10, 2017