Senegal’s debt: bondholders appoint White & Case, according to Reuters

The members of the group have not been made public. White & Case declined to comment to Reuters. However, the creation of this structure provides investors with a common framework to follow discussions that could alter the repayment terms of Senegal’s sovereign foreign currency debt.

The Senegalese Ministry of Economy, Finance and Planning launched on 1 September a Senegal debt treatment plan (PTDS). The government says it aims to restore the sustainability of public finances after an audit revealed budget imbalances and a higher debt level than previously announced.

On the same day, the International Monetary Fund staff and Senegalese authorities announced a staff-level agreement on a 36-month program worth about 2.2 billion dollars under the Extended Credit Facility. This agreement remains subject to approval by the IMF’s management and board, as well as assurances of financing and corrective measures related to the issue of misinformation.

Creditors organizing ahead of negotiations

According to Reuters, White & Case has previously advised states in debt restructurings, including Ethiopia and Ukraine, as well as creditor groups in Lebanon and Sri Lanka. Its mandate in Senegal comes as investors seek to coordinate in response to the planned restructuring of external debt.

The plan presented by Dakar foresees treatment of foreign currency debt within a strengthened framework inspired by the G20 common framework, while excluding debt denominated in CFA francs from the announced scope. The government says it favors active debt management aimed at lengthening maturities, reducing refinancing risks, and restoring market access.

Pressure remains high on the sovereign rating. On 4 September, S&P Global Ratings downgraded Senegal’s foreign currency debt rating to “CC” and local currency debt to “CCC,” with a negative outlook. The agency considers a distressed debt exchange or default on some foreign currency commercial bonds extremely likely if the plan results in creditors receiving less than initially expected.

The IMF still awaits several guarantees

Prime Minister Ahmadou Al Aminou Lo stated on 8 September before the National Assembly that debt treatment is essential to clean up the macroeconomic framework, while rejecting the idea of a new structural adjustment. The Senegalese Press Agency reported this clarification the day after his general policy statement.

The Ministry of Finance highlights that the budget deficit was reduced from 13.4% of GDP in 2024 to 6.4% in 2025. Authorities plan to continue reforms in budget governance, transparency, and debt management to restore the confidence of partners and investors.

The new agreement with the IMF will not result in any disbursement before its review by the institution’s board of directors. The Fund specified that approval will depend notably on the implementation of corrective measures and the receipt of sufficient financing assurances.