Senegal denies allegations of secret €650m borrowing

Senegal’s debt crisis has intensified after the government denied allegations that it secretly secured €650 million in borrowing, according to Africa News via Associated Press on March 25th.

The government of Senegal stated that its financial activities were conducted in accordance with the transparency rules.

On March 23rd, a Financial Times report indicated that the Senegalese government had secretly secured a €650 million loan.

Reportedly, the deal was facilitated by the Africa Finance Corporation (AFC) and First Abu Dhabi Bank, and could see the two organisations given preference over the current bondholders.

However, the government of Senegal, through its finance ministry, denied allegations of entering into secret deals, stating that it was a strategy to diversify its funding sources.

The government stated that the deals were conducted in accordance with market transparency rules and that they received a more favourable deal than what was offered in the international market.

This is in addition to the financial challenges the government is currently facing, including a budget deficit and a debt burden. The government has also claimed that previous governments misrepresented the nation’s debt obligations in recent years.

Senegal’s economic status has also come under the spotlight of international bodies. Recently, the International Monetary Fund (IMF) mission to Senegal found discrepancies in fiscal data for the period 2019-2023, thereby suspending the $1.8 billion assistance package approved in 2023.

However, the country has managed to meet some of its financial obligations despite economic pressure, leading to its removal from the European Union’s money laundering blacklist in June 2025.

Senegal has also managed to pay off its international debt, valued at about $471 million, thereby relieving some of the pressure building over the possibility of default.

The use of complex financial structures, such as derivatives, has also come into question, as the mechanisms may be abused to access liquidity without adhering to traditional reporting requirements.

It is also important to note that Senegal’s case mirrors the problems faced by other emerging economies, including higher borrowing costs.

Africa News via Associated Press, Financial Times and agencies, Maghrebi.org