Senegal seeks more time to pay off debt

Senegal will try to buy more time to pay off its debt by extending the maturity of its borrowing, its prime minister said, as the country works to qualify for an International Monetary Fund program.

The plan also involves renegotiating interest rates, but would not cut the overall debt load. He said the country must clear $3.5 billion in arrears to avoid stalling economic activity and triggering job losses.

The IMF and Senegal reached an agreement last week for a $2.2 billion loan package, pending final approval. The country’s finances have been under strain since the previous government failed to disclose billions in loans, pushing debt above 130% of GDP and prompting the nation to request the IMF suspend an earlier program.

The crisis has fueled political turmoil: President Bassirou Diomaye Faye split with his longtime ally Ousmane Sonko this year, in part due to disagreements over how to handle the debt.