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Senegal and Gambia Country Risk Report Q2 2016

Senegal and Gambia Country Risk Report Q2 2016

Core Views

The Gambia will see higher real GDP growth in 2016 and 2017 thanin previous years, as the negative effects of the regional Ebola crisisdissipate. We forecast a continued improvement in The Gambia’sreal GDP growth, predicting a 3.8% expansion in 2016 and 4.9% in2017 – following 1.6% in 2014 and an estimated 3.3% in 2015. Thereremain serious underlying macroeconomic problems, however, andprotecting an overvalued currency will continue to run down reserves.

President Yahya Jammeh is likely to remain in power, barring deathor illness or removal by military coup.

Agriculture will remain the dominant sector in The Gambia, thoughinvestment into other industries such as tourism will help drive realGDP growth.

The country will remain reliant on foreign grants in order to meetits fiscal obligations, although these are under threat given politicaldevelopments. The Gambia is looking increasingly to Arab Gulfstates for funding.

Core Views

Real GDP growth will be 6.0% in 2016 and 6.3% in 2017, and willremain at a similar level over the coming years.

The country will remain a bastion of West African stability and willcontinue to develop its democratic institutions.

Inflationary pressures will be benign, in part thanks to the XOFFranc’s peg to the euro.


Executive Summary – The Gambia
Core Views
Key Risks
Chapter 1.1: Economic Outlook – The Gambia
SWOT Analysis
Economic Growth Outlook
Macroeconomic Policies Will Raise Investor Concerns
The Gambia will see quicker real GDP growth in 2016 and 2017, as the negative effects of the regional Ebola crisis dissipate.
GDP By Expenditure Outlook
TABLE: GDP GROWTH FORECASTS
TABLE: PRIVATE CONSUMPTION FORECASTS
TABLE: GOVERNMENT CONSUMPTION FORECASTS
TABLE: FIXED INVESTMENT FORECASTS
TABLE: NET EXPORTS FORECASTS
Chapter 1.2: 10-Year Forecast – The Gambia
The Gambian Economy To 2025
Robust Growth Outlook Susceptible To External Shocks
Real GDP growth in Gambia will be robust over the coming 10 years, hovering around 5.0% per annum. This will be driven by
agriculture and tourism, though growth will be constrained by poor infrastructure.
TABLE: LONG-TERM MACROECONOMIC FORECASTS
Chapter 1.3: Political Outlook – The Gambia
SWOT Analysis
Domestic Politics
President Jammeh Targets Gulf Aid With Islamic Declaration
The unconstitutional declaration by President Yahya Jammeh that The Gambia is now an Islamic state is a political act aimed
at ensuring aid flows from rich Gulf states. This will help shore up his rule, but will exacerbate other risks such as terrorism and
emigration.
Long-Term Political Outlook
President Jammeh To Shape Next Decade
The Gambia’s political landscape will continue to be shaped by President Yahya Jammeh over the next decade, as political and press
freedoms will continue to be reduced. A change in government will only come about through either a military coup or revolution.
Chapter 1.4: Operational Risk – The Gambia
SWOT Analysis
Executive Summary – Senegal
Core Views
Key Risk
Chapter 2.1: Economic Outlook – Senegal
SWOT Analysis
Economic Growth Outlook
On The Ground: Emerging From The Doldrums
Senegal’s real GDP growth will accelerate in 2016 thanks to public and private investment in new industries and major public works.
President Macky Sall’s effective leadership and economic plan will help attract funds, and BMI found most people on the ground held a
positive outlook on the country’s direction.
GDP By Expenditure Outlook
TABLE: GDP GROWTH FORECASTS
TABLE: PRIVATE CONSUMPTION FORECASTS
TABLE: GOVERNMENT CONSUMPTION FORECASTS
TABLE: FIXED INVESTMENT FORECASTS
TABLE: NET EXPORTS FORECASTS
Chapter 2.2: 10-Year Forecast – Senegal
The Senegalese Economy To 2025
Growth To Outpace Previous Decade
Senegal will enjoy strong real GDP growth over the next decade, averaging 6.0% annually, an improvement on the 3.8% recorded
over the previous 10 years. Growth will be driven by private consumption, though the country’s poor infrastructure will impede
development.
TABLE: LONG-TERM MACROECONOMIC FORECASTS
Chapter 2.3: Political Outlook – Senegal
SWOT Analysis
Domestic Politics
Sall Will Set An Example For Other SSA Leaders
President Macky Sall will successfully reduce his mandate from seven to five years in a 2016 referendum, meaning that the next
presidential election will take place in 2017 rather than 2019. On present performance Sall would win a second term, but progress must
be made in poverty reduction.
Long-Term Political Outlook
Bastion Of Regional Stability To Flourish Politically
Senegal will continue to develop politically over the next decade, cementing its reputation as one of the most stable democracies in
Africa. There are challenges to this stability, not least from poverty and unemployment, but we believe that accelerating economic
development will help Senegal overcome these.
Chapter 2.4: Operational Risk – Senegal
SWOT Analysis
Chapter 3: BMI Global Macro Outlook
Global Macro Outlook
Unfinished Business In 2016
TABLE: GLOBAL ASSUMPTIONS
TABLE: DEVELOPED STATES, REAL GDP GROWTH, %
TABLE: BMI VERSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORECASTS, %
TABLE: EMERGING MARKETS, REAL GDP GROWTH, %
TABLE: GAMBIA – MACROECONOMIC DATA & FORECASTS
TABLE: SENEGAL – MACROECONOMIC DATA & FORECASTS

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