AfDB backs Senegal with $35 million to improve public finance management

The African Development Bank (AfDB) has approved $35 million in financing for Senegal to strengthen public finance management, deepen fiscal reforms and improve budget transparency as the West African nation works to restore confidence following its debt challenges.

The funding will support efforts to increase domestic revenue, improve public financial governance and accelerate structural reforms aimed at strengthening the country’s economic resilience, according to a statement from the lender.

The financing comes as Senegal seeks to stabilize its public finances after the government disclosed more than $13 billion in previously unreported debt in 2024, prompting heightened scrutiny from investors and international financial institutions.

Debt recovery efforts gain momentum

Senegal is also expected to appoint Lazard as its financial adviser on debt-related matters while continuing discussions with the International Monetary Fund (IMF) on a new financing arrangement after the Fund suspended its previous credit program.

Authorities have repeatedly said they intend to restore debt sustainability without pursuing a sovereign default, instead focusing on reforms designed to meet IMF requirements and strengthen fiscal discipline. The AfDB did not specify whether the approved financing will be provided as a loan or a grant.

AfDB reaffirms long-term partnership

“Through this operation, the African Development Bank reaffirms its commitment to standing alongside Senegal to consolidate economic reforms, strengthen domestic resource mobilisation and create the conditions for more resilient growth,” said Wilfrid Abiola, head of the AfDB’s Senegal country office.

The latest package builds on a partnership between the AfDB and Senegal that dates back to 1972. Over the decades, the institution has supported projects spanning transport infrastructure, agricultural transformation and public finance modernization.

The new financing underscores the bank’s continued commitment to helping Senegal strengthen fiscal governance, improve transparency and create a more sustainable foundation for long-term economic growth while rebuilding investor confidence.