Senegal energy subsidies surge to 790.3 billion FCFA

Senegal's 2026 rectifying finance bill faces significant pressure due to an energy shock. Energy subsidies have surged to 790.3 billion FCFA, far exceeding the initial 250 billion FCFA projected in the 2026 initial finance law. This increase, representing approximately 3.5% of GDP compared to the originally planned 1.1%, is driven by rising international oil prices and a delay in adjusting domestic energy prices.

As a result of these rising costs, the national budget deficit is expected to increase from 1,245.1 billion FCFA to 1,735.2 billion FCFA, rising from 5.4% to 7.6% of GDP. The total financing requirement has reached 6,774.2 billion FCFA, which includes 4,516.2 billion FCFA for debt amortization. While the government adjusted administered hydrocarbon prices in August 2026 to mitigate the impact on public finances, the fiscal burden remains substantial.