Following pressure from the United States, France, the IMF and the World Bank, the government launched an economic structural adjustment program in the early 1980s. The abolition of agricultural subsidies led to higher production costs and consumer prices.
In 1983, the country was hit by a major drought, particularly affecting peanut production, which represents 35% of export revenue. The shortage of food made it necessary to import 400,000 tonnes of rice that year.
In 1988, PSS once again won the election with 73% of the vote against 26% for the PDS. The opposition seriously questioned the election campaign and several of its leaders were detained. According to Countryaah, PDS leader, Waye went into exile in Paris, from where he first returned in March 1989.
A month later, a border dispute erupted with neighboring Mauritania. At the same time, the conflict froze the plans for amalgamation with the Gambia. In previous years, efforts had been made to form the federal state of Senegambia. Diouf criticized the neighboring country for tolerating partisans from Casamance to operate from its territory and for entering into a mutual defense agreement with Nigeria.
The background to the conflict with Mauritania was violent clashes between farmers and cattle owners in the border area, and the number of fallen ones rose to hundreds. About 70,000 refugees traveled inland.
In January 1991, accused Amnesty International Senegal for violations of human rights and torture and killings in the Casamance region. In late May, the government issued an amnesty, declaring that political prisoners would be released – including MFDC leader Abad Diamacoune Senghor.
In July 1991, Diouf was elected President of ECOWAS (Economic Community of the West African States), comprising 16 countries from the region. In September, the United States government returned $ 42 million of Senegal’s debt to support the Allied army during the Gulf War and to join the “peacekeeping forces ” in Liberia. At the same time, the IMF issued a new loan of $ 57.2 million.
In the same year, a number of political-institutional changes began. The Prime Minister’s post was reinstated and the opposition was allocated 2 ministerial posts. After three months of negotiations with the opposition parties, an agreement was reached in September 1991 on reform of the electoral system. In 1992, the conflict with the separatist movement in Casamance broke out again after a ceasefire on February 21.
In a situation characterized by accusations of electoral fraud, President Diouf won the first round of the presidential election on February 21, 1993, with 58.4% of the vote. At the May parliamentary elections, his party regained PSS control of the National Assembly with 84 out of the 120 seats. The main opposition party, PDS gained 27 seats.
The country’s economic and financial situation deteriorated further through 1993 – especially as world market prices for its export products dropped drastically. It worsened the trade deficit, which was offset by new loans abroad. Foreign debt reached $ 3.5 billion, equivalent to 60% of GDP.
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In early 1994, France and the IMF decided to devalue the African Franc (CFA) by 100%, further exacerbating social tensions. On February 16, the opposition’s Coordination of Democratic Forces conducted a demonstration against the government. It ended in clashes with police, killing 6 policemen and injuring dozens of protesters.