Senegal short-term loans trade at deep discounts amid debt distress signals
Quidah is an online platform that connects investors with curated opportunities and expert insights on Africa’s emerging markets, while offering businesses promotional services, partnership facilitation, and market intelligence to attract capital and grow their operations.
Industries
Senegal’s short-term euro-denominated commercial loans maturing as early as February are trading at or below 80 cents on the euro, two traders and two investors told Reuters. Such pricing for near-term maturities signals market concern over repayment capacity following the disclosure of over $11 billion in previously unreported liabilities that elevated debt-to-GDP above 119%.
Senegal’s Ministry of Finance denied reports of discounted trading, stating market data were inaccurate, though sources said no buyers had expressed interest and firm bids remained unclear. The strain follows the IMF’s suspension of its $1.8 billion lending programme last year, forcing reliance on domestic borrowing and commercial paper issuance.
Traders indicated they are pricing in potential debt restructuring as IMF bailout negotiations stall. Prime Minister Ousmane Sonko described IMF-linked restructuring proposals as “a disgrace.” Senegal confronts 1.02 trillion CFA francs ($1.8 billion) in commercial debt repayments to international creditors in 2026.
The 2028 eurobond trades around 70 cents on the euro, while 2031 and longer-dated bonds change hands at 54-61 cents per Tradeweb data.
