The president, Macky Sall, made sure about a second term in the 2019 political race, assisting with keeping up wide political security. We gauge that genuine GDP will have shrunk by 0.7% in 2020, inferable from the impacts of the Covid pandemic. It will recuperate in 2021 as framework venture and rural yield rise. In 2022-25 development will be helped as hydrocarbons creation goes ahead stream. Nonetheless, there are outstanding dangers to this figure, as the nearby oil area is in undeveloped structure.
As indicated by the refreshed IMF figures from the fourteenth April 2020, because of the episode of the COVID-19, GDP development in Senegal is required to tumble to 3% in 2020 from 5.3% per year sooner, because of the flare-up of the COVID-19 pandemic. Gross domestic product development should get to 5.5% in 2021, subject to the post-pandemic worldwide financial recuperation, finish of the public venture under the Senegal’s advancement procedure “Plan Sénégal Emergent” (PSE) and private utilization (IMF). The development has been driven by areas like horticulture and administrations.
Main sectors of industry
Despite the fact that Senegal is moderately poor in characteristic assets, the nation is plentiful in minerals, particularly phosphates and iron metal.
Senegal is one of the world’s driving phosphate makers, and has critical stores of zirconium, titanium, marble, gold, and limestone, just as a few sorts of valuable stones. Albeit just 16.62 % of the land is arable, farming utilizes 32% of the labor force and adds to 16.6% of the GDP. Senegalese farming is profoundly powerless against climatic dangers and insect dangers.
Senegal’s primary crops are peanuts, dark looked at peas, cassava, watermelons, millet, rice and corn. Fishing is likewise a significant wellspring of income.
The mechanical area adds to 25.8% of the GDP and utilizes 14% of the labor force. It depends basically on the creation of manures and phosphoric corrosive – which is shipped off India, just as nut handling (oil and cows supper) and fish preparing (regardless of a developing consumption in asset).
The main modern section is food creation, trailed by materials and compound ventures. Senegalese ventures additionally produce food, materials, wood items, synthetic compounds, development materials, hardware, gear, power, and water. In any case, the mechanical area is presently in emergency due an absence of energy the executives.
The administration area adds to 50,4% to the GDP and utilizes 55% of the labor force. It profits by the nation’s brilliant media communications framework, which cultivates interest in tele-administrations and the Internet. This area has been growing consistently.
The travel industry has likewise been developing, especially among European explorers.
Taxation for businesses
VAT is at 18%
The reduced rate is 10% and only applies to tourism services. A 17% special tax rate applies to financial activities (replacing the VAT).
Excise taxes exist on beverages (50% for beverages containing alcohol plus an additional tax ranging from XOF 1,500 to XOF 5,000 per litre, and 5% for sparkling beverages), tobacco (65%), coffee (5%), tea (5%), fat (rate varies from 10% to 15%), private cars with a horsepower higher than 13CV (10%), cosmetic products (15%), oil products, plastic bags (XOF 3 per gram).
Owners of motor vehicles (car, truck, or motorbike) must pay an annual tax of XOF 1,000 per hectolitre. Companies owning or renting vehicles for more than 15 days a year are liable to an annual tax with rates ranging from XOF 50,000 to XOF 200,000.
Resident entities are taxed upon their overall pay, though non-inhabitants are commonly burdened through the presence of a perpetual foundation (decided as per OECD’s guidelines).
Organizations are considered as Senegalese occupants in the event that they have an enrolled fixed foundation. Capital Gains TaxationCapital gains are viewed as business pay and charged at the standard corporate expense pace of 30%. Deals of stocks by a non-occupant are additionally dependent upon a 30% rate.
Investing in Senegal
Senegal has a large stock of FDI contrasted with its area. The public authority is driving a functioning approach to energize FDI inflows. As indicated by the UNCTAD 2020 World Investment Report, FDI in Senegal rose from USD 848 million out of 2018 to a record high of USD 983 million out of 2019 (+16%). The all out load of FDI remained at USD 6,4 billion toward the finish of 2019. By and large, the portion of imports from EU nations has been declining, while those from Asian nations has been expanding. Nontheless, the Senegalese economy remains profoundly subject to European development.
Since 2014, FDI inflows have been connected to the Emerging Senegal Plan for the improvement of foundation, power, horticulture, drinking water and wellbeing. France is the biggest financial specialist in Senegal, yet as of late there have been significant speculations from China, Turkey and the United Arab Emirates. Some other key financial specialists are Morocco, Indonesia, and the United States.