By Toby McIntosh
To promote debt transparency, the International Monetary Fund promised to use “sharpened claws” and the World Bank prescribed “radical transparency.”
What their words mean in practice may be revealed in Senegal in the wake of the 2024 hidden-debt scandal.
The World Bank has quietly funded a project to improve Senegal’s debt management practices and to support transparency, including through the issuance of a “quarterly consolidated debt bulletins.”
The IMF and Senegal are still negotiating, but debt transparency is key topic. One possible action is the creation of a centralized debt database, officials have said.
The basic size of the problem in Senegal was revealed in a February Court of Auditors’ report. About $13 billion in hidden debt accumulated between 2019 and 2023. The sovereign debt for 2023 wasn’t 74.4 percent of gross domestic product (GDP), but rather 111 percent. This bad news caused the IMF to pause its support and call for “urgent reforms. Senegal’s credit rating has fallen.
The government commissioned an audit by the private firm, Forvis Mazars. The results were shared with the IMF, but not with the public.
How much illumination will eventually shine on Senegal’s debt, past and present, is hinted at in IMF statements and World Bank documents, but with limited detail.
Perhaps prophetic is an observation from a World Bank report, cautioning that “promoting transparency is contentious and there may be setbacks.”
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World Bank Project Addresses Debt Transparency in Senegal
The World Bank Board in June approved a project for Senegal that includes funding for debt management reforms and “debt transparency through better recording and reporting.”
More specifically, the project includes:
- Establishing a new debt recording system aligned with internationally recognized good practices.
- Establishing a single responsible debt management entity centralizing all debt functions (a clear back-office, middle-office and front-office functions) negotiating, reporting and monitoring of all borrowing.
- Conducting debt records reconciliation with creditors, at least on an annual basis.
- Preparing quarterly consolidated debt bulletins with more granularity (loan-by-loan
- information on new loans contracts, PPP related guarantees, loans guaranteed by beneficiaries, and stock of arrears) than previous debt bulletins. (PPP refers to public-private partnerships.)
The $115 million effort, known as SEN-FISCALE (Strengthening Senegal’s Fiscal Sustainability Program) is just beginning, but the documents describe the goals and deliverables. (All documents about the project.)
In an evaluation of the proposed project, the Bank said it “will not exacerbate social conflict, instead, it is designed to improve Senegal’s fiscal sustainability through robust PFM [Public Financial Management] and reduced public debt.”
Separately, the World Bank in a June report year pledged “radical transparency” about sovereign debt. (Read more about it below.)
Describing Senegal’s hidden-debt crisis, the Bank said, “This substantial fiscal misreporting is a by-product of long-standing systemic gaps between de jure procedures compliant with West African Economic and Monetary Union (WAEMU) directives, and de facto poor practices across Senegal’s PFM system.”
In a rather different assessment, the main IMF official in talks with Senegal, Eddy Gemayel, said in March that the challenge was how to prevent a reoccurrence of “a very conscious decision to underestimate the debt stock.” (See news report.)
IMF-Senegal Negotiation on Debt Transparency
A top IMF official in May said the Fund would use “sharpened claws” to get governments to disclose more about their external debts.
The remark was delivered by Mark Flanagan, Deputy Director of the IMF’s Strategy, Policy, and Review Department, at the start of a two-day, mostly closed conference in Washington on debt transparency that was attended by dozens of country representatives.
(See EYE article, IMF Official Pledges to Use ‘Sharpened Claws’ for Sovereign Debt Transparency, May 25, 2025. Also, Under-Estimated External Debt in Senegal Highlights Ongoing Debt Transparency Challenge, April 3, 2025.)
During months of discussions between the IMF and Senegal, debt transparency has been a key topic.
Some broad conclusions appear to have been reached. More detail about transparency conditions may emerge along with an expected new package of IMF financial support for Senegal.
“The mission discussed with the authorities a comprehensive set of remedial measures to address the root cause of the misreporting,” according to an Aug. 26 IMF summary.
These include:
- centralizing debt management functions,
- strengthening the role of the National Public Debt Committee, and
- completing the ongoing comprehensive audit of payment arrears launched by the Inspectorate General of Finance on July 21, 2025.
- Establishing a centralized debt database,
- strengthening budgetary commitment controls, and
- consolidating bank accounts under the Treasury Single Account.
Senegal Praised by IMF Head
“The Senegalese authorities have made important progress in addressing Senegal’s misreporting case,” said Kristalina Georgieva, the IMF’s Managing Director in a statement after an “informal briefing” the IMF Executive Board meeting held about Senegal on Oct. 2.
“I commend them for their admirable commitment to transparency, the actions taken to identify public debt liabilities, and their close collaboration with Fund staff on these issues,” Georgieva said, adding, “The authorities are firmly advancing in the implementation of corrective measures to resolve the misreporting issue.”
“Based on the ongoing work, we are in a good position to move expeditiously forward on all fronts,” according to Georgieva’s statement. Since the debt scandal emerged, the IMF has insisted that Senegal get to the bottom of the problem and take steps to prevent reoccurrences if Senegal wants further IMF support.
IMF Communications Department Director Julie Kozack said at a September briefing said the IMF aims to “restore fiscal transparency” and obtain a “reliable budget report.”
IMF Team Met With Accounting Office
Senegal’s plans on debt transparency seem to be have been shown to an IMF delegation that visited Senegal and met Sept. 15 with the General Directorate of Public Accounting and the Treasury, according to Sene.News.
“During the meeting, Alioune Diouf, Director of Public Debt, presented to the IMF experts the progress of the reforms already underway,” Sene.News reported. “Among them is the establishment of a centralized database of public debt, interfaced with the Integrated Public Financial Management System (SIGIF) and the D-Aida system of the Treasury, to ensure reliable and integrated monitoring.”
Further, the article said, “Diouf also detailed the new planning of information on public debt, now coordinated between the Public Debt Directorate and the Directorate of Public Expenditure Scheduling.” He also said plan is under development to reorganize debt management.
The IMF’s apparent confidence in Senegal’s efforts showed at an August briefing at which Kozak said that Senegalese authorities and IMF staff “share a very strong commitment to constructively resolving the misreporting case in Senegal.”
She lauded “the very important steps that have already been undertaken by the Senegalese authorities,” citing “successive audits of public debt data, beginning with a report by the Inspectorate General, followed by the Court of Auditors, and most recently, an audit by a reputable international firm.” The IMF staff, she said, has been granted “full access to the findings of the report.”
Forvis Mazars Audit Still Confidential
Kozack was referring to the report done by the audit firm Forvis Mazars, hired by Senegal’s government. A preliminary report in July went to government and the IMF.
About the Forvis Mazars preliminary report, Kozak said IMF staffers “are currently reviewing that report and all the information in detail.” She said, “The preliminary assessment in the report is broadly aligned with expectations, and the final validation is ongoing.”
The IMF First Deputy Managing Director Gita Gopinath met with Senegal’s President Bassirou Faye during his visit to Washington, D.C. on July 9. Kozack said, Gopinath “emphasized the IMF’s continued support, as Senegal works to resolve the misreporting matter,” continuing, “And the President reaffirmed his government’s strong commitment to transparency and reform.”
In June, Senegal’s Ministry of Finance postponed the release of its budget execution reports for the last quarter of 2024 and the first quarter of 2025 to June 23, “citing the need to ensure accuracy and restore transparency,” reported Medafricatimes. In a communique, the Finance Ministry emphasized its commitment to restoring budgetary credibility through rigorous data reclassification and verification, promising more “sincere and reliable” financial disclosures moving forward,” according to the article.
Back in March, the IMF said it was looking for “urgent reforms” from Senegal, according to a March 26 IMF statement. A key challenge would appear to be how to prevent a reoccurrence of “a very conscious decision to underestimate the debt stock,” as stated by Eddy Gemayel, the head of the recent IMF mission to Senegal. (See news report.)
IMF’s Prescription: ‘Sharpened Claws’
What the IMF’s “sharpened claws” look like may be felt in Senegal and show how many past IMF statements on debt transparency have been honed.
There is considerable IMF research on debt transparency, A working paper from early 2024 by the IMF legal department identified “critical weaknesses that hinder debt transparency.”
More recently, the IMF Executive Board received a report entitled A Stocktaking of The Current International Architecture for Resolving Sovereign Debt Involving Private Sector Creditors. Much of the report concerns debt restructuring and transparency in that context. No debt restructuring is anticipated for Senegal.
The 2025 IMF stocktaking report defines a number of debt transparency cures, saying. “There are important benefits for sovereigns in having greater debt transparency, which information provision obligations can help with.”
The report says that creditors should avoid limiting sovereigns’ ability to disclose their debt through confidentiality clauses. It references a 2023 IMF report, Making Public Debt Public—Ongoing Initiatives and Reform Options. The summary concludes, “The IMF could contribute to these reforms with actions within its mandate but would need significant additional resources.”
The stockingtaking report summarizes a handful of “varied” transparency efforts. Sri Lanka is cited for instituting “relatively more extensive information provision obligations.” The report says, “Sri Lanka has also issued governance-linked bonds where coupon payments are reduced if Sri Lanka meets certain governance performance indicators, including satisfying the information provision obligations.”
Another new IMF report mentions transparency in relationship to bond issuance. (See Chapter 3 of the 2025 Global Financial Stability Report.)
IMF Official Sketches Plan
The broad strokes of what the IMF wants on debt transparency were laid out in a Sept. 1 article in International Banker by Tobias Adrian, Financial Counsellor and Director of the Monetary and Capital Markets Department at the IMF. He wrote that “public-debt transparency is not a choice, but a necessity.”
“Transparency must be understood in both narrow and broad terms,” Adrian said, continuing, “It involves more than just publishing debt statistics; it encompasses legal and institutional frameworks, disclosure of borrowing strategies, clarity on contingent liabilities and robust governance over public financial management.”
In some emerging market and developing economies, Adrian observed, “transparency is limited by the use of confidential debt structures, particularly in resource-rich countries in which creditors demand collateralized agreements that circumvent reporting standards.” He added, “Elsewhere, sovereigns may underreport liabilities by relying on off-budget financing through SOEs or extra-budgetary entities.”
“Tackling these challenges requires targeted legal reforms and institutional “plumbing” that strengthens public-debt governance,” according to Adrian, “The legislative council in a country should have greater oversight over high-level public-debt issues, including comprehensive visibility of the public-debt portfolio and its associated costs and risks.”
Determining “the appropriate debt-management strategy by the debt manager should pave the way for greater transparency on the fiscal-debt nexus,” Adrian said.
“Countries must establish disclosure mandates that extend beyond the central government to encompass general government and SOE [state-owned enterprise] obligations,” Adrian said. “At the same time, creditors and international institutions have a role to play by aligning lending practices with transparency standards and encouraging the phasing out of opaque structures.
Adrian described what the IMF expects to get from countries about their debt. And he said, “Importantly, debt transparency has been integrated as a specific outcome in the Fund’s results-based management system, ensuring sustained focus across technical-assistance projects.”
The IMF, he said, “remains a committed partner in this journey—working alongside ministries of finance, debt offices, central banks and audit institutions to build more transparent, resilient and accountable public-debt systems.”
World Bank ‘Radical’ Diagnosis
In June, the World Bank issued its Radical Debt Transparency Report. After discussing transparency related to debt restructurings, the report states, “Thus far, opportunities to improve debt transparency and disclosure during and in the immediate aftermath of a restructuring process have largely gone unexploited.”
“Legal frameworks and institutional settings in many countries are not conducive to debt transparency,” according to the Bank report, which mentions Senegal.
“These issues came into sharp focus in Senegal, where inadequate frameworks and weak oversight over the past few years have resulted in one of the largest debt misreporting cases, now being addressed by the authorities,” the report states. One challenge is that “some loans are subject to lower levels of scrutiny and may even be contracted off-budget.”
The importance of four recommendation is rated “High.”
- Adopt legislative and regulatory reforms to help ensure transparency in loan contracts.
- Consent to the publication of loan-level data through the World Bank’s Debtor Reporting System. (This would be voluntary initiative by borrower countries.)
- Strengthen debt authorization procedures to ensure the oversight of new borrowing or guarantee operation of the public sector by the debt management office.
- Expand the coverage and improve timeliness of public debt reports in the categories identified in the World Bank’s Debt Transparency Reporting Heat Map.
The World Bank’s report cites several “heterogeneous disclosure practices.” Chad published a statistical bulletin, but “without disclosing any information on the outcome of the only loan renegotiation finalize.” Zambia has publishing detailed quarterly debt bulletins and statements on the agreements achieved with creditors.
The report describes stricter conditionality introduced by the private sector through “transparency positive covenants,” describing examples of more disclosure in Ghana and Sri Lanka.
“Similarly,” the report states, “official creditors should consider linking their debt relief—which is typically delivered over time—to predefined debt disclosure standards to be designed in consideration of the debtor’s capacity and legal framework for debt data disclosure.
The concluding line of the report’s introduction, written by Axel van Trotsenburg Senior Managing Director World Bank, says, “Raising the bar for transparency and trust is not optional— it is imperative.”
The Bank’s Debt Reporting Heat Map has steadily rated Senegal’s debt transparency as improving.
In 2020 the Heat Map gave rated Senegal as red in 7 of the of the 9 categories. Red is lowest of the colored scores; green, yellow, orange and red.
But in the most recent, 2024 rating, Senegal had only two red scores, and five greens. One of the red marks was because information was not provided “with the expected granularity,”
Senegalese Seek More Information
Journalist and political figure Mamadou Ibra Kane on Aug. 27 in an op-ed article on Seneweb asked several questions that he said need “to be clarified one day or another in the name of transparency.” One question was whether the Forvis Mazars report will be published?
A coalition of lawmakers, economists and civil groups in early August called for an audit to determine whether $7 billion in previously unreported debt should be canceled, citing concerns over the strain the borrowing places on Senegal’s finances.
Whether progress on transparency is being made was strongly questioned by Birahime Seck, the General Coordinator of the Forum Civil, an NGO that is the Senegalese section of Transparency International.
“To date, Senegal has been slow in implementing serious, structural reforms to combat money laundering, promote transparency in the management of public affairs, and prevent and combat corruption,” wrote Seck in November of 2023. continuing, “On the contrary, we are witnessing the persistence of poor governance and a chronic lack of accountability on the part of control and/or regulatory bodies.” Seck detailed many reforms that he the government was failing to implement and called on the IMF to take a more active role.
On Aug. 25, Senegal’s National Assembly adopted an Access to Information Law.
While celebrating this milestone, ARTICLE 19 Regional Director Alfred Nkuru Bulakal said that the exemptions in the law “while protecting legitimate interests, are not clearly defined.” He said, “If crudely considered, they could hamper the ultimate objective of transparency the law should pursue.”
Whether the new access law can be applied to debt-related documents may eventually get tested.
