Economic Overview
Following quite a while of extremely humble development, the Government of Senegal adopted the Plan Senegal Emergent (PSE) in 2014. The improvement plan is intended to get Senegal out of a cycle of low-development and frail destitution decrease. Fundamental figures put Senegal’s monetary development at 6.8 percent by 2017—the third year in succession of a development rate of more than 6 percent.
Implementing the plan, which supported open venture and advanced private segment action, clarifies this, in addition to a development helpful macroeconomic structure and great exogenous conditions (great climate, generally low oil costs). In spite of high development, expansion stays low and under control.
The primary segment of the economy is the most unique, developing at more than 7% (due especially to horticulture), yet the optional division is grabbing and anticipated that would lead the pack in a couple of years. On the interest side, fares and aggregate venture have been the quickest developing segments. Senegal’s macroeconomic structure stays strong, however, little breaks are developing, underscored by rising obligation levels and liquidity requirements.
The government continues to implement the PSE, or national development plan, and its related reforms. To maintain high growth, these include investment projects in energy, transport infrastructure, and agriculture, and other in-depth reforms to attract further private investment.
Main Sectors in Senegal
The primary sectors utilizes half of the workforce and adds to 17,5% to the GDP. Senegalese agribusiness is very powerless against climatic perils and grasshopper dangers. Senegal’s fundamental harvests are peanuts, dark peered toward peas, cassava, watermelons, millet, rice and corn. The nation is moderately poor in common assets. Angling is additionally imperative wellspring of income. Peanut cultivation and refining have seen a tremendous decline over the past two decades. Once the country’s leading foreign currency earner, the peanut industry now accounts for only 25 percent of exports.
The fishing sector is Senegal’s export leader. Fisheries are one of the main pillars of the economy. In 2007, fishery products contributed 22% of Senegal’s export earnings and employed about 15% of the population.
The mechanical division adds to over 20% of the GDP and utilizes 23% of the workforce. It depends basically on the creation of manures and phosphoric corrosive to be sent to India, and additionally nut handling (oil and steers dinner) and fish preparing (regardless of a developing consumption in asset). Today, this division is in emergency due an absence of vitality administration.
The tertiary division adds to 60% to the GDP and utilizes 28% of the workforce. It profits by the nation’s fantastic media communications foundation, which empowers interest in teleservices and the Internet. This part has been extending relentlessly.
Senegal’s textile industry produces limited volumes of domestic cloth and finished apparel.
Trade is significant for Senegal’s economy; the combined value of exports and imports equals 74 percent of GDP. The average applied tariff rate is 11.6 percent.
Taxes in Senegal
Branches and companies are liable for corporate income tax (CIT) at the rate of 30%.
Residents are taxed upon their worldwide income. Non-residents are generally taxed via the existence of a permanent establishment (PE) on Senegal-source income.
WHTs may also apply to non-residents, as per the services delivered to Senegalese taxpayers, subject to the application of a double tax treaty (DTT).
Senegal has various WHTs. The primary ones are:
- 20% WHT on remuneration paid for services (including royalties) rendered by a foreign individual or foreign company.
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5% WHT on remuneration paid for services rendered by a resident individual (liable for tax under lump sum taxation, among others) or resident company that are not subject to CIT.
- 10% WHT on dividends distributed.
- 13% WHT on bond interest.
- 8% WHT on deposits or guaranteed interest on accounts with a bank.
- 16% WHT on other revenues, notably interest on loans.
Double tax treaties (DTTs)
Senegal has concluded such treaties with the following countries:
Belgium, Canada, France, Italy, Lebanon, Mauritania, Mauritius, Morocco, Norway, Portugal, Qatar, Spain, Tunisia, United Kingdom, WAEMU (West African Economic and Monetary Union. Member states are Benin, Burkina-Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, and Togo).
Investing in Senegal
1. Telecom and ICT
The provincial idea of business requires the usage of portable administrations, as shown by a close to 90 percent versatile entrance rate. The area has seen some enthusiasm for ICT, for promoting and versatile amusements. The area likewise sporadically fights the legislature on expense approach and direction.
2. Oil, Gas and Mining
Arranged investigation has concentrated on the gainful Mauritania-Senegal-Guinea Bissau Basin. The basin covers a couple of neighboring nations. OGM organizations view the basin as a section point into West Africa and a chance to fabricate a territorial nearness.
OGM benefit organizations convey similar desire to the locale, and organizations look to remote financial specialists to help their development.
3. Heavy Industry & Construction
Authorities look to upgrade existing infrastructure, from ports to roads. This government mandate drives the demand for the heavy industry supplies, particularly in the cement sector. A strong regional demand for construction supplies adds another significant boost to the sector.
4. Banking and Finance
It is believed that Senegal can become the center for the Islamic finance, as a country with an approximate 95 percent Muslim population. About 54 percent of West Africa’s population is Muslim.