Editing Economy of Senegal (section)

== History ==

The [[GDP per capita]]<ref>[http://earthtrends.wri.org/text/economics-business/variable-638.html EarthTrends -> Economics, Business, and the Environment -> Variable -> Searchable Database Results: Economics, Business, and the Environment — GDP: GDP per capita, Units: Current US$ per person] {{webarchive |url=https://web.archive.org/web/20080131140920/http://earthtrends.wri.org/text/economics-business/variable-638.html |date=January 31, 2008 }}</ref> of Senegal shrank by 1.30% in the 1960s. However, it registered a peak growth of 158% in the 1970s, and still expanded 43% in the turbulent 1980s. However, this proved unsustainable and the economy consequently shrank by 40% in the 1990s.

=== IMF and 1990s economic reforms ===

Since the January 1994 CFA franc devaluation, the [[International Monetary Fund]] (IMF), the [[World Bank]], and other multilateral and creditors have been supporting the Government of Senegal's structural and sectoral adjustment programs. The broad objectives of the program have been to facilitate growth and development by reducing the role of government in the economy, improving public sector management, enhancing incentives for the private sector, and reducing poverty.

In January 1994, [[Senegal]] undertook a radical economic reform program at the behest of the international donor community. This reform began with a 50% devaluation of Senegal's currency, the CFA franc, which was linked at a fixed rate to the [[French franc]]. Government price controls and subsidies have been steadily dismantled as another economic reform.

This currency devaluation had severe social consequences, because most essential goods were imported. Overnight, the price of goods such as milk, rice, fertilizer and machinery doubled. As a result, Senegal suffered a large exodus, with many of the most educated people and those who could afford it choosing to leave the country.

After an economic contraction of 2.1% in 1993, Senegal made an important turnaround, thanks to the reform program, with a growth in [[GDP]] averaging over 5% annually during 1995–2004. Annual [[inflation]] had been pushed down to the low single digits.

As a member of the West African Economic and Monetary Union (WAEMU), Senegal is working toward greater regional integration with a unified external tariff and a more stable monetary policy. Senegal still relies heavily upon outside donor assistance, however. Under the IMF's [[Highly Indebted Poor Countries]] debt relief program, Senegal will benefit from eradication of two-thirds of its bilateral, multilateral, and private sector debt, contingent on the completion of privatization program proposed by the government and approved by the IMF.