19 November 2009 - The International Monetary Fund (IMF) has urged Senegal to revamp its state power company Senelec, warning that power blackouts are dragging down the West African country's economy.
Senegal depends mostly on oil fired stations run on imported fuel. A spate of power cuts in August and September triggered street protests and followed what company officials said was a cash-flow crisis at state energy firm Senelec, according to Reuters.
"A well-functioning electricity sector is a key basis for higher growth," IMF division chief Norbert Funke told Reuters after a regular staff mission to Senegal.
"Senelec needs an operational model which is consistent with Senelec's long-term viability," he said, urging measures to raise efficiency, improve fuel purchasing systems and clear existing debt.
The IMF forecast economic growth at 1.25 per cent this year - slightly lower than an earlier forecast of 1.5 per cent - before a pick up to 3.5 per cent next year, assuming the wider world recovery and the pace of domestic reform remains on track.
The government said in July it planned to invest more than $1bn in the energy sector by 2012, and provide millions of low-energy light bulbs to households to ease fuel bills that are already among the highest in Africa.
President Abdoulaye Wade also announced plans last year to harness the huge solar power potential of the region, which so far has been lacking in expertise and investment.