Senegal's 2012 growth recovered to an estimated 3.7%, after a slowdown in 2011 when agriculture suffered. This should continue in 2013 and 2014 thanks to new infrastructure programmes.
The new president and government elected in 2012 have taken measures to improve good governance, which should boost the management of public resources.
The structural transformation of the economy remains slow. Strategies are planned to promote new products to diversify exports and growth sources.
Senegal's economy recovered in 2012 with growth estimated at 3.7% of gross domestic product (GDP), up from 2.1% in 2011. Projected growth for 2013 and 2014 is 4.3% and 5.1% respectively. These projections assume that the government’s socio-economic programme will be implemented along with the Policy Support Instrument (PSI-II) 2010-13 agreed upon with the International Monetary Fund (IMF). The main investment programmes are for road infrastructure, with the continuation of a toll motorway and Blaise Diagne International Airport, as well as energy (electricity distribution).
The National Strategy for Economic and Social Development (SNDES) for 2013-17 was approved in November 2012. It centres on three areas of action: growth, productivity and wealth creation; human capital and sustainable development; and government, institutions, peace and security. The direction taken by the new administration in the area of good governance should lead to better management of public resources. The implementation of necessary reforms to achieve growth objectives may be made easier by the strong legitimacy of the new ruling team that emerged from the presidential and parliamentary elections in early 2012. However, the opening of the Senegalese economy makes it vulnerable to fluctuations in world commodity prices and to the economic crisis in Europe and political crisis in neighbouring Mali. There are also internal risks linked to floods and other climatic shocks and to the slowness of the road infrastructure programme and reforms, especially of the energy sector.
Recent studies indicate that from 1980 to 2009, labour migration was from the primary and secondary sectors to the urban informal sector. But the structural transformation of Senegal's economy remains slow. About 60% of the working population still depends on agriculture. Senegal has not become mining-oriented, despite the potential offered by phosphate and gold. Mining and quarrying accounted for less than 1.5% of GDP for the period 2002-11. Reforms to improve the business environment and the quality of human resources are therefore crucial.
Figure 1: Real GDP growth 2013 (West)
Table 1: Macroeconomic indicators 2013
|Real GDP growth||2.1||3.7||4.3||5.1|
|Real GDP per capita growth||-0.5||1.1||1.7||2.5|
|Budget balance % GDP||-6.6||-7||-7.9||-7.4|
|Current account % GDP||-7.7||-8.6||-9.3||-10|
Recent Developments & Prospects
Table 2: GDP by Sector 2013 (percentage of GDP)
|Agriculture, forestry & fishing||-|
|Agriculture, hunting, forestry, fishing||13.8|
|Electricity, gas and water||2.9|
|Electricity, water and sanitation||-|
|Finance, insurance and social solidarity||-|
|Finance, real estate and business services||15.6|
|General government services||-|
|Gross domestic product at basic prices / factor cost||100|
|Public Administration & Personal Services||-|
|Public Administration, Education, Health & Social Work, Community, Social & Personal Services||7.1|
|Public administration, education, health & social work, community, social & personal services||-|
|Transport, storage and communication||12.7|
|Transportation, communication & information||-|
|Wholesale and retail trade, hotels and restaurants||19|
|Wholesale, retail trade and real estate ownership||-|
Economic activity gained intensity in 2012, with 3.7% growth thanks to a good harvest. However, growth was held back by the crisis in neighbouring Mali and poor peanut production in 2011, as well as tensions in the lead up to the presidential election in early March 2012. The drop in Malian demand caused the decline in exports of hydraulic cement (‑0.3%) and petroleum products (‑2.3%) in 2012.
On the supply side, the return to normal agricultural production enabled the primary sector to contribute 16.7% of GDP in 2012. This growth is forecast to continue in 2013 and 2014. Agriculture recovered because rainfall was good and seeds and fertiliser were distributed on time by the government. The groundnut sector grew in volume, as did cotton, tomatoes and watermelons. The value added of livestock farming fell by an estimated 1.1% in 2012 due to a fall in the number of recorded slaughters. The fisheries sector rebounded, growing by 6.8% in 2012 thanks to increased landings by traditional fisheries. Senegal has stopped granting fishing licenses, while Mauritania has granted more licenses to Senegalese boats.
Growth in the primary sector has been erratic and subject to floods, droughts and other external shocks. After recording negative growth of 10.8% in 2011, the sector grew by 8.9% in 2012 and is projected to expand by 6.1% in 2013. Medium- and long-term transformation of the economy depends on the stabilisation of rural revenues and the diversification of the sources of value added.
The secondary sector (excluding mining and quarrying) contributed 22.2% of GDP in 2012. In 2013 and 2014, this growth is expected to be supported by manufacturing as unrest in Mali stabilises. The 1.4% decline in the value added of the secondary sector in 2012 was the result of a drop in the production of phosphates, fats, flour and cement. Industry, which is concentrated on the primary processing of raw materials, still needs diversifying. Sugar production rose as a result of a five-year sugar self-sufficiency plan which ends in 2015. Similarly, production of textile fibres increased following the implementation of the three-year (2010-13) plan to revive the cotton industry. Energy production increased, thanks to the restructuring of the sector since 2011. But these increases were not enough to drive growth in industry as a whole.
The tertiary sector, including government, contributed 58.2% of GDP in 2012, with growth of 4%. The sector was driven mainly by financial services, telecommunications and trade. In contrast, transport (especially rail and air) hotels and restaurants suffered a setback in 2012 due to difficulties encountered by the tourism and leisure sectors. The tertiary sector should rebound in 2013 and 2014, with growth of around 4%, since the crises in Europe and Mali are expected to wane, VAT on tourism will stay at 10% and agricultural production and manufacturing is forecast to grow.
Growth in domestic demand rose from 3% in 2011 to 5.3% in 2012. This additional growth helped offset weak exports and resulted in a 5% rise in imports. Household consumption contributed more than 70% of GDP in 2011‑12, driven by rising remittances, which were estimated at XOF 737.7 billion (CFA franc BCEAO) in 2012 (10% of GDP). Gross fixed capital formation was supported by public investment. After falling by 1.9% in 2011, it rebounded in 2012 thanks to work on a major toll road, on Blaise Diagne International Airport and investment in the electricity sector. In 2013 and 2014, gross fixed capital formation and job creation will be boosted by the start of zircon mining, as well as gold mining. In 2012 the Apix agency invested XOF 432.6 billion to create a plant for water desalination and drinking-water production (100 000 m3 a day), energy production (400 MW a day) and salt production with German, Turkish and Senegalese capital.
The reform of the general tax code (Code général des impôts) will lead to a rationalisation of tax exemptions and tax relief for individuals in 2013. This will affect the purchasing power of households by approximately XOF 29 billion, or 0.37% of GDP, in 2013. The implementation of the accelerated growth strategy as part of the SNDES should result in growth of 4.3% in 2013 and 5.1% in 2014. Public investment is aimed at reconstituting seed capital and equipment in rural areas, as well as road and energy infrastructure programmes, including as part of an agreement financed by the Millennium Challenge Account. These investments and reforms, especially in the energy sector, should be effective enough to limit the risks resulting from shocks such as the Mali crisis and climate instability.
Fiscal policy in 2012 was marked by a slowdown in the global economy and tensions in neighbouring Mali and Guinea-Bissau. The budget deficit, estimated at 7% in 2012 against 6.6% in 2011, would have been higher (8%) if measures had not been taken to cut government spending and delay some non-priority capital expenditure. The budget deficit in 2012 came from the XOF 150 billion, or 2% of GDP, of subsidies on energy (electricity and oil products). Other factors that widened the deficit were aid for drought victims and lower-than-projected growth (3.7% versus a projection of 3.9%). The deficit is projected to rise in 2013 to 7.9%.
Total receipts increased by 12.9% in 2012 to XOF 1.72 trillion due to increased budget revenue (9.8%) and grants (41.3%). The tax burden rose from 18.8% to 19.1% in 2012, above the West African Economic and Monetary Union (WAEMU) target of 17%. Fiscal policy was slightly expansionary in 2012. The ratio of expenditure to net loans reached around 30%, up from 29% in 2011.
The 8.9% rise in total expenditure and net lending in 2012 was caused by a 6.1% rise in wages and salaries, a 6.6% rise in other current expenditure (including subsidies), and a 17.7% rise in debt servicing. The additional debt costs were due to a 47.7% hike in domestic debt service.
Capital expenditure on domestic financing uses about 37% of tax revenue, well above the WAEMU standard of 20%. The wage bill as a percentage of tax revenue was about 30% in 2012, and is expected to remain the same in 2013‑2014, below the 35% ceiling. Under the PSI, the government has a XOF 50 billion ceiling on payment orders, but without accumulation of arrears. Electricity price subsidies in 2013 should be limited to XOF 80 billion (a saving of XOF 45 billion based on current oil prices). It seems unlikely that this limit will be kept however.
The draft 2013 budget is in line with the priorities of the country's development strategy. About 35% of the budget is allocated to the infrastructure, agriculture, health and education ministries. The XOF 14.2 billion reduction in current expenditure and the XOF 81.4 billion increase in capital expenditure reflect the government's desire to have a more investment-oriented budget.
Table 3: Public Finances 2013 (percentage of GDP)
|Total revenue and grants||21.6||21.9||22.5||23.1||23||23.2|
|Total expenditure and net lending (a)||26.8||27.3||29.1||30.1||30.9||30.6|
|Wages and salaries||6||6.1||6.3||6.3||6.3||6.2|
Senegal is a member of WAEMU, the eight-country group that uses a single currency, the West African CFA franc. Monetary policy, for which the main objective is to ensure price stability and safeguard purchasing power, is conducted within the monetary union.
Monetary conditions in Senegal and the wider WAEMU community were marked by the reduction of required reserve ratios from 7% to 5% in March 2012. Similarly, the minimum open market bid rate was reduced from 3.25% to 3% in June 2012. These two decisions by the Central Bank of West African States (CBWAS) pushed down interest rates for loans of all maturities, with the notable exception of lending rates, which rose by 25 basis points between the second and third quarter, reaching 8.16% by the end of September 2012. In Senegal, lending rates stood at an average of between 4.97% and 11%, depending on the borrower. The CBWAS has decided it would cut rates by a further 25 basis points in March 2013. This would bring the minimum open-market bid rate down from 3% to 2.75%.
Senegal’s money supply, measured by the aggregate M3, grew from XOF 2.71 trillion in 2011 to XOF 2.91 trillion in 2012. This resulted in an increase in domestic credit of around 14% and a reduction in net foreign assets of around 11%. The money supply grew from 39.8% of GDP in 2011 to 40% in 2012, while credit to the economy amounted to 30.5% of GDP in 2012. In 2013, the money supply is projected to increase to XOF 3.23 trillion, or 42% of GDP.
According to the World Bank report Doing Business 2012, firms cite access to finance as a major constraint. On regional financial markets, the Senegalese government has a greater presence than private enterprises, with total borrowing amounting to XOF 76.8 billion as of 20 October 2012. The money market has been active over the past few years, and on 12 October 2012 the government injected XOF 429.7 billion. It issued eurobonds in 2009 and 2010 and plans to take out non-concessional loans amounting to around USD 200 million in 2013. Inflation was contained at 2.5% in 2012 (down from 3.4% in 2011), despite higher food prices (cereals) and higher non-alcoholic drink prices. Forecasts predict inflation will be below the WAEMU ceiling of 3%.
Economic Cooperation, Regional Integration & Trade
The trade deficit for 2012 is estimated at 18.1% of GDP. The current account deficit was 8.6% of GDP in 2012, and is projected to rise to 9.3% in 2013. This deficit should be financed by public and private capital transfers. Migrant remittances in 2012 were an estimated XOF 737.7 billion and should remain at 10% of GDP in 2013. Foreign direct investment (FDI) was estimated at XOF 136 billion in 2012 (about 2% of GDP), compared with XOF 133 billion in 2011, and is expected to decline to XOF 88 billion in 2013.
Only exports of industrial gold increased significantly (+53.4%) in 2012. The sharpest falls were for exports of groundnuts, mineral and chemical fertilisers, phosphoric acid and food products. Mali remains the top destination for Senegalese exports, receiving 47% of exported hydraulic cement and 11% of exported petroleum products. WAEMU countries were the destination of 24.3% of exports in 2012. The liberalisation of the sale of groundnuts resulted in direct intervention by Chinese and Indian buyers with Senegalese producers at the expense of oil manufacturers.
Disbursements of official development assistance (ODA) in 2010 totalled XOF 479 billion, or about 8% of GDP. Budget support from technical and financial partners to implement the reforms resulted in disbursements of XOF 163 billion (2.25% of GDP) in 2012. Senegal slipped in the World Bank's Doing Business rankings from 164th to 166th place. Similarly, it fell down in the Global Competitiveness Index rankings, from 111th to 117th. The depreciation of the CFA franc against the currencies of partner countries (‑1.6%) and the favourable inflation differential (‑2.6%) enhanced competitiveness by an average of 4.2% during the first eight months of 2012.
Table 4: Current Account 2013 (percentage of GDP)
|Exports of goods (f.o.b.)||18.8||16.4||16.8||17.7||17.7||17.4||17.2|
|Imports of goods (f.o.b.)||31.1||32.3||31.7||34.8||35.8||35.6||35.6|
|Current account balance||-6.4||-6.7||-4.5||-7.7||-8.6||-9.3||-10|
Senegal continued to diversify its debt instruments in 2012 in terms of the concessional level, maturity and interest rates by issuing debt securities on regional and international markets. The government gives priority to concessionary financing and neither contracts nor guarantees external loans on non-concessional terms. It consults the IMF in advance whenever it does not stick to these criteria. The government plans to use remaining funds from the IMF programme for non-concessional loans (USD 200 million) and the programme for semi-concessional loans to finance infrastructure investment.
Domestic debt reached an estimated 9.9% of GDP in 2012 and is projected to reach 8.9% in 2013. External debt, meanwhile, reached an estimated 32.2% of GDP in 2012, and is projected to reach 34.1% in 2013. Public debt service was estimated at 9.9% of government revenue in 2012 – well below the 30% ceiling – and is expected to remain the same in 2013. As a percentage of exports of goods and services it was estimated at 8.3% in 2012 and is projected to rise fractionally to 8.4% in 2013, both of which are below the 20% ceiling identified in the debt sustainability analysis. Domestic debt service increased by 47.6% in 2012 to reach XOF 66 billion. It is projected to reach XOF 82 billion in 2013.
The debt ratio remains below the 70% ceiling set as part of WAEMU’s control measures. Total debt, however, stood at XOF 1.20 trillion in 2007, three times as high as immediately after the cancellations made as part of the Multilateral Debt Relief Initiative (MDRI) in 2006. The domestic debt stock is growing steadily, albeit slowly, reaching around 10% of GDP in 2012 compared to just 4.5% in 2007. This upward trend is the result of the external financing of major public investment programmes and financing on the international market in 2009 and 2011.
The most recent analysis of debt sustainability concluded that Senegal is a low risk. Aware of the inherent risk of a rapid rise in debt, the government created its first medium-term debt strategy led by the Treasury’s new public debt division (Direction de la dette publique). This new strategy, based on detailed study, calls for a reshaping of debt by reducing short-maturity instruments for domestic debt.
Figure 2: Stock of total external debt and debt service 2013
Economic & Political Governance
Despite reforms to improve the business environment, major efforts are still necessary. In the World Bank report Doing Business 2013, Senegal scores below the African average for “getting electricity” (180th in the world), paying taxes (178th) and registering property (173th). In the World Economic Forum's Global Competitiveness Report 2012‑13 Senegal was ranked 117th out of 144 countries.
With room for improvement possible, the 11th meeting of a presidential council on investment held in December 2012 adopted a set of short-term measures and a new programme of reforms for 2013‑15.
These include a new general tax code that came into force at the start of 2013, removing registration fees for business start-ups and lowering the tax on real-estate transactions. In the energy sector, the additional capacity of the Bel Air and Kahone power stations and the rehabilitation of production capacity of the state electricity company, Société nationale d’électricité (Sénélec), should result in a better electricity supply in 2013. In the new tax code, value added tax for tourism has been frozen at 10%.
For those seeking loans, there are plans to set up credit information centres in 2013, as part of efforts being conducted for the WAEMU. There will also be collateral registries and a reliable database of the mortgage registry.
For property registration, transaction authorisations will be abolished and replaced with a prior declaration. For land conservation, meanwhile, there will be statistics on the time taken to establish and issue real rights and transfers and record them in the land registry.
The new programme of reforms (2013‑15) envisages the automation of administrative procedures, the creation of a simplified fiscal and legal framework that provides incentives, and the promotion of investment with a strong social impact.
The financial system is continuing the diversification of its range of products and its increased accessibility, thanks in particular to the development of microfinance. The banking sector dominates Senegal's financial system, accounting for 88% of assets at the end of 2011. Credit to the economy was worth an estimated 30.5% of GDP in 2012, down from 28.7% in 2011. Access to financial services is estimated at about 19% (opening of bank accounts, microfinance institutions and the postal network).
Stress tests conducted by the monetary authorities and the IMF indicate the sector can stand up to liquidity and interest-rate risks. The high level of bank liquidity stems from the lack of creditworthy projects.
Nevertheless there are risks to the soundness of the banking sector because of the high concentration of loans. Another cause for concern is the ratio of non-performing loans, which reached 17% in 2012.
There are at least 234 microfinance outlets in the Dakar region, and more in other urban and rural areas. By July 2012 the total credit given by the institutions was XOF 219 billion. The main beneficiaries were small retail, services, agriculture and transport enterprises. The concentration of these businesses could be a risk for the microfinance system.
On the regional stock exchange, total market capitalisation increased by 1.1% from XOF 4.19 trillion at the end of June 2012 to XOF 4.24 trillion at the end of September 2012. This trend is due to the 1.4% rise in market capitalisation of stocks and shares.
With the opening of the National Economic Development Bank (Banque nationale pour le développement économique), the number of banks in Senegal could rise to 20 in 2013. Various initiatives are under way to improve access to finance, including the creation of the FONGIP priority investment guarantee fund (Fonds de garantie des investissements prioritaires), which targets investment by young people and women or in rural areas. Mobile banking has also developed rapidly, especially in rural areas.
Public Sector Management, Institutions & Reform
Senegal has put new WAEMU directives on public finances into its legislation, with parliament approving a transparency code in December 2012. The provisions of a new general financial administration law will be tested in 2013 in the justice and environment ministries.
Regarding external auditing, in 2012 the National Assembly passed a reform of the court of auditors (Cour des comptes) aimed at strengthening its independence and its powers. Furthermore, following the reactivation of the anti-corruption court (Cour de répression de l'enrichissement illicite), a law was passed in December 2012 to set up a national anti-fraud and anti-corruption office (Office national de lutte contre la fraude et la corruption). This office has the power to act on its own initiative and its reports will be made public.
Eight national agencies were abolished in 2012 and the others will be assessed in 2013. A physical audit of civil servants was launched. A reform of the general tax code in 2012 will lead to a rationalisation of tax exemptions in 2013. To improve cash flow the government will continue its work to set up a single treasury account, which should be completed in 2013.
The authorities publish information such as calls for tenders for public works in newspapers and on the public markets management system website, SYGMAP website: www.marchespublics.sn. The broadcasting of parliamentary debates on radio and television allows people to follow public affairs. Many of the media function independently and report unethical behaviour.
Natural Resource Management & Environment
The sectoral policy on the environment and natural resources planned for 2009‑15 aims to ensure a sustainable environment and reverse the degradation of the environment and natural resources. The sector has a framework for medium-term expenditure and a budget designed to concentrate spending on priority areas.
Technical and financial partners provide support for major projects to prevent deforestation and help the population adapt to climate change. Of the 127 validated environmental and social management plans (PGES), 58% (74 plans) were monitored in 2011, down from 60% in 2010. The reforestation/deforestation ratio stood at 0.99 in 2011, up from 0.96 in 2010, thanks to the regeneration of 8 232 hectares and the reforestation of 29 266 hectares, versus 19 455 hectares in 2010.
The new government has announced it plans to review the legislative framework of the mining sector. In the medium term, the country plans to join the World Bank’s Extractive Industries Transparency Initiative (EITI).
Under the SNDES 2013‑17, environmental achievements already made will be boosted by policies aiming to mitigate the effects of climate change on ecosystems, strengthen management for the environment and natural resources, promote the green economy and green jobs, and make rural ecosystems less vulnerable to climate change.
Presidential and legislative elections were held in 2012. Protests following the decision of the Constitutional Court in January to allow the candidacy of incumbent President Abdoulaye Wade were severely repressed and several people killed. The elections themselves ran smoothly however and were deemed transparent. The election of opposition candidate Macky Sall as president strengthened Senegalese democracy. The July 2012 general election was won by the Benno Bokk Yakaar (BBY) coalition supported by the president. The BBY took 119 of the 150 seats available.
Good governance is one of the new government's priorities. As part of the battle against corruption and the pursuit of illegally acquired goods, the questioning of dignitaries from the former government began in July 2012. People have high expectations that the new government will create jobs and improve living conditions.
In its efforts to bring peace and security, the new government has adopted a regional approach to resolving the conflict in Casamance, with greater involvement from the Gambia and Guinea-Bissau. This strategy resulted in the release of eight hostages, including seven military personnel held by separatist factions of the Mouvement des forces démocratiques de Casamance (Movement of Democratic Forces of Casamance, MFDC). Instability in Mali has increased the militant threat to the region. Finally, 2012 was marked by numerous strikes by state teachers. The 2011/12 school year was saved by agreements reached between the new authorities and teachers' unions.
Thematic analysis: Structural transformation and natural resources
Between 1991 and 2011, economic growth was volatile, peaking at 6.7% in 2003 as a result of the statistical catch up from the minimum 0.7% in 2002. Between 1995 and 2005 growth averaged 4.5% a year. Growth was helped by the devaluation of the CFA franc in January 1994, but also by reforms. The tertiary sector has been the main contributor to GDP for several decades as there have been no major new products in the diversification of exports and sources of growth. On the demand side, consumption remains the main component, driven by monetary income from groundnuts, public investment in external resources, and more recently, remittances from migrants.
During the 1960s and 1970s, a downward trend in the primary sector’s share of GDP benefited the secondary and tertiary sectors.
Studies indicate that from 1980 to 2009, labour migration has been from the primary and secondary sectors to the urban informal sector. But the transformation remains slow, since 60% of the working population still depend on agriculture.
Mining and quarrying accounted for less than 1.5% of GDP for the period 2002‑11. The main resources are phosphates, limestone (cement transformed) and groundnut products. The first gold bar was produced in Senegal in 2009. Gold capacities are estimated at four tonnes a year for seven years. The mining of heavy mineral sands is in the development stage. Production is expected to be 85 000 tonnes of zircon a year for 25 years.
No provisions have been made to ensure that future generations benefit from the income acquired through national resources. However the income is not high enough to justify creating a long-term sovereign wealth fund. Recent research has reached two major conclusions. Firstly, given the structure of Senegal's export basket, its growth potential for the period 2010‑30 lies between 5.89% and 8.20%. For the past 30 years, Senegal's GDP per capita, and hence its productivity, has been below the African average.
As the country did not have a major resource such as oil, Senegal relied in the past primarily on groundnuts and phosphates as its main export products. Since the 1970s, fish, cotton and tourism have helped to diversify the economy. None of these products, however, has provided a sustainable platform for a thriving industry. The edible oils and fats sector is feeling the effects of fluctuating levels of rainfall and world prices. Phosphate derivatives (fertilisers and phosphoric acid) are faced with problems of quality and/or competitiveness. The tuna industry is not competitive. Tourism has also not achieved the desired success.
The lack of entrepreneurs and private investors was the reason for the government's role in the 1960s and 1970s to promote growth and development. The poor results reflect the failure to make the right strategic choices, to base planning on transformation of the economy and to implement reforms while maintaining necessary discipline. In response to the need to harmonise public and private initiatives to promote entrepreneurship, investment and innovation, the Conseil présidentiel de l'investissement (presidential investment council, CPI) was created in 2002 and an accelerated growth strategy (Stratégie de croissance accélérée, SCA) was created in 2005‑07. These measures should enable infrastructure, finance, human resources, the legal and institutional framework and promising sectors to benefit from greater attention from public and private officials.
To place structural transformation on a sustainable foundation, guidelines are needed to steer the emergence and renewal of sectors that are diversifying exports and sources of growth. But such a portfolio does not yet exist.
The government growth strategy aims to use a collaborative, competitive partnership to set up a successful innovation system to bring together the strongest sectors and ensure that development accelerates. Such a system can provide appropriate solutions to the lack of public and private leadership, the lack of skills in the workforce, and the weak total factor productivity.
The government plans to create an investment fund with the characteristics of a sovereign wealth fund, that would apply specific budgetary rules to natural resource revenues. Money for the fund would come from revenues from resources like phosphate, gold and zircon, the sale of fishing licences and fisheries agreements, and revenue from the sale of capital assets or royalties shares. To be effective, the fund would have to invest in real development projects and follow international practices as the goal is to ensure long-term development for future generations.