Senegal’s Short-Term Loans Trade at Deep Discounts Amid Rising Debt Pressures
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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.[web:context] Two of the sources said such pricing for near-term maturities is rare and signals market concern over repayment capacity following the revelation of over $11 billion in previously unreported liabilities that pushed debt-to-GDP above 119%.[web:context]
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 were unclear.[web:context] The strain follows the IMF’s suspension of its $1.8 billion lending programme last year, leaving the government reliant on domestic borrowing and commercial paper. Sources said traders are pricing in potential debt restructuring as IMF bailout talks stall.
Prime Minister Ousmane Sonko called IMF-linked restructuring proposals “a disgrace.” Senegal faces 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, with 2031 and longer bonds at 54-61 cents per Tradeweb data.[web:context]
