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Power Cuts Slow Senegal's 2011 Growth -IMF
Wednesday, 19 October 2011 17:58
(Reuters) - The International Monetary Fund has revised down its 2011 economic growth forecast for Senegal to 4 percent,
due to the country's power cuts, according to an IMF statement issued on Wednesday.The previous growth forecast of 4.5 percent was made in April, versus actual growth of 4.2 percent last year.
The IMF said that inflation, which hit a peak of five percent earlier in the year on higher food and fuel prices, should average around 3.6 percent for 2011.
Looking ahead, the Fund said spending on power generation and road projects should see economic growth in 2012 rise to 4.4 percent while inflation "should maintain its downward path and remain below 3 percent".
The rolling power cuts, which sometimes last more than 30 hours, have sparked street protests ahead of an election due early next year.
The government has launched a plan dubbed "Takkal" -- the word for 'light' in the local Wolof language -- which aims to invest about 1 billion euros to end the electricity crisis.
As part of the plan, the government has in recent months turned to the Islamic Development Bank and the West African Development Bank (BOAD) for financing.
However, the IMF called for prudent management of infrastructure spending, which also includes a toll road and a new airport, and flagged concerns over costly government electricity subsidies, which it said could hit 100 billion CFA francs ($208.6 million) in 2011.
Incumbent President Abdoulaye Wade is due to stand for re-election despite growing opposition to his rule and critics saying that he is not eligible to stand, having already served two terms in power. ($1 = 479.361 CFA Francs)
(Reporting by David Lewis; editing by Stephen Nisbet)
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