Senegal is likely to become a significant oil and gas producer by the start of the next decade. These resources can be an important driver of economic growth as the resource is developed and over the peak production period. However, should Senegal become oil dependent, the foreign capital inflow associated with oil and gas production could cause serious macroeconomic challenges. Certain types of funds and other institutional arrangements can help address these challenges and also promote sustainable development.
This 2018 working paper by UN Environment was commissioned by the Partnership for Action on Green Economy (PAGE) at the request of the Ministry of the Environment and Sustainable Development in Senegal. It explores a number of potential financial vehicles and mechanisms which can be used to manage oil and gas revenues. Drawing on insights from global best practices, the paper sets out some policy options available to the Government of Senegal to promote sustainable development through the management of revenues from the oil and gas sector.