The International Monetary Fund said on Thursday it had made "significant progress" with Senegal toward a new loan programme while the Fund continued an internal investigation into how it failed to detect billions of dollars in unreported debt, Reuters reported. Senegal is trying to tame debts that the Fund said hit 132% of GDP at the end of 2024 after the current leadership uncovered billions in debts that were not reported by the previous administration.
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The International Monetary Fund said it is assessing the viability of Senegal's financing strategy as it looks to finalize an agreement on reforms to underpin a new program, an IMF official said on Thursday, Reuters reported. A team of officials from the IMF completed a mission to Dakar without outlining a new support package after the previous one was suspended following findings of debt misreporting. Political infighting and disagreements with the Fund over a possible debt restructuring have weighed on the country's bonds.
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Senegalese bonds plunged to fresh record lows, placing the West African nation into debt-distress territory, according to a measure widely considered to be the threshold that locks countries out of global capital markets, Bloomberg News reported. The sovereign risk premium on Senegal’s bonds over US Treasuries widened to 1 077 basis points on Wednesday — the highest on record, according to JPMorgan Chase & Co. data. That places the country among other African issuers whose debt is trading at or near 1 000 — seen as a marker of distress.
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Senegalese President Macky Sall’s pledge to step down at the end of his term was cheered by investors, following weeks of turmoil sparked by his attempt to stay in power, Bloomberg News reported. Prices on Senegal’s dollar eurobonds rose on Friday for the first time in four days, lowering yields on the notes due May 2033 by 10 basis points to 8.73% after his announcement late the previous evening. The nation’s dollar bonds due March 2048 also advanced.
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The Executive Board of the International Monetary Fund approved a 3-year Extended Credit Facility and Extended Fund Facility for about $1.51 billion with Senegal, and a $324 million arrangement under the Resilience and Sustainability Facility, the IMF said on Monday, Reuters reported. The EFF/ECF program will help address macroeconomic imbalances while the RSF arrangement will help with longer-term challenges related to climate change, the fund said.
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Moody’s has clashed with the UN after putting five countries on review for a downgrade in recent weeks, saying that a G20-backed debt suspension scheme poses risks to private creditors, the Financial Times reported. The rating agency took action against Ethiopia, Pakistan, Cameroon, Senegal and the Ivory Coast, after the countries opted into a G20-backed initiative that allows them to freeze official bilateral debt repayments due this year to member nations and members of the Paris Club, a group representing major credit countries.
Australian-listed oil and gas company FAR Ltd said on Wednesday its Senegalese unit had defaulted on its obligations to the Sangomar joint venture, as the company looked to sell its interest in the project, Reuters reported. The company owns 15% of the Sangomar oil and gas field being developed off Senegal, while Cairn Energy holds 40%, Australia’s Woodside 35%, and Senegal’s national oil company Petrosen 10%, which it has the right to increase to 18%.
The African Development Bank is seeking to triple its capital base to accommodate surging demand for emergency loans from African states and businesses hit by falling export income and sharp declines in foreign investment and remittances. Donald Kaberuka, the AfDB’s president, will put the plans to the bank’s annual general assembly in Dakar this week in one of the first tests of developed countries’ commitments to financing an economic rescue package for Africa.
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