Senegal's debt: 130% of GDP after audits, Dakar targets an agreement within six to nine months

Senegal wants to resolve its debt crisis within a few months. Dakar is seeking a restructuring under a "strengthened" version of the G20 Common Framework, the mechanism created in 2020, and a government source claims that the Paris Club has discussed a possible agreement within six to nine months, or even sooner, according to a Reuters analysis published on October 13, 2026. The Paris Club declined to comment.

A debt revealed by audits

It all began in 2024, when President Faye's administration revealed that the previous government had significantly underestimated the country's debt. Subsequent audits brought the estimate to approximately 130% of GDP, including state-owned enterprises and state-guaranteed loans. The consequences were immediate: credit rating downgrades, a massive sell-off of Senegalese bonds, and the suspension of the program with the International Monetary Fund. Dakar must also unwind nearly $1.3 billion in loans contracted through total return swaps.

Four creditor committees and points of friction

Senegal proposes to negotiate in parallel with four committees: bilateral creditors, bondholders, commercial banks, and regional development institutions. The latter two have complicated restructurings in other countries, Reuters notes. Furthermore, Dakar wants to exclude several billion dollars of debt denominated in CFA francs, which would shift losses onto other creditors. The IMF, for its part, points out that there is only one Common Framework and disputes the term "strengthened." Discussions are also underway regarding a new $2.2 billion program: spokesperson Julie Kozack indicated there is no timeline for a board presentation.

A test for the entire continent

World Bank President Ajay Banga has supported the Senegalese approach, and IMF Managing Director Kristalina Georgieva has deemed these efforts "encouraging." Zambian Finance Minister Situmbeko Musokotwane notes that his country's restructuring took nearly four years and that those who followed have benefited from it. Conversely, Lee Buchheit warns that disagreements between bilateral creditors can drag on for years. "A real test," summarizes Yvette Babb of William Blair.

The stakes go beyond Dakar. African finance ministers are asking the G20 and multilateral lenders to impose a six-month deadline for restructurings conducted under the Common Framework, the suspension of IMF interest surcharges, and real debt service relief without new austerity, reports Africanews. In some African countries, this service now absorbs between 30% and 50% of tax revenue.

For Moody's analyst Aurelien Mali, Senegal starts with advantages: offshore oil and gas, growth, and access to regional financing. Its challenge, he says, is to restore its fiscal credibility, not to avoid collapse.