Senegal Targets December Agreement on Restructuring $13 Billion Debt
GEOPOLITICSAFRICA
Photo: Xinhua
Senegal is seeking an agreement in principle with official creditors and bondholders by December 2026, after the discovery of approximately $13 billion in previously misreported debt forced the government to pursue a restructuring under the G20 Common Framework. The government has begun formal discussions with creditor groups and is seeking coordinated negotiations between official and private creditors.
The restructuring includes discussion of approximately $1.72 billion in total-return swaps held by First Abu Dhabi Bank, the African Finance Corporation and Société Générale. Senegal has said that CFA-franc-denominated debt will remain outside the restructuring, while bondholders involved in the discussions hold roughly $2.2 billion of the country's $5.2 billion in outstanding bonds.
The case is important beyond Senegal because it tests how quickly an African government can renegotiate externally held obligations under the reworked Common Framework. It also raises a broader question of fiscal sovereignty: how much of a government's development budget can remain available for domestic priorities when debt accumulated through previous borrowing and accounting practices has to be renegotiated with external creditors.