Hidden Billions: The Scandal of Senegal’s Concealed Public Debt

Many African countries are struggling with crippling external debt, a situation that has attracted much attention. One of the reasons is that the debt is deemed unsustainable for most countries, due to a debt-to-GDP ratio that is too high. The second reason is the high cost of servicing the debt, which is absorbing more resources than spending on education and health. This is due to the rapid rise in private debt.

In fact, since the beginning of the 2000s, access to financial markets of several African countries has changed the debt profile. According to the African Development Bank, up to the early 2000s, Africa’s bilateral debt with the Paris Club creditors accounted for 52 per cent of its total debt. It fell to 27 per cent in 2019. Over the same period, private debt rose from 17 per cent to 45 per cent. As a result, total public debt service more than doubled prior to the pandemic, increasing from 16 per cent of government revenues in 2012 to 39 per cent in 2019. In 2024, 20 out of 48 African countries paid more in debt service than they spent on healthcare and education combined. On average, between 2025 and 2027, interest payments on African external debt are expected to account for 3.4 per cent of the continent’s GDP. 

Western credit rating agencies’ subjective perception of the risk of African economies has raised the cost of borrowing for Africa compared to other regions of the world. For instance, between 2020 and 2024, African countries paid an average interest rate of 9.8 per cent compared to 5.3 per cent for Asian countries and 6.8 per cent for Latin American countries. It is estimated that Africa could save up to 74 billion dollars a year in interest payments if the global credit ratings system were based on the continent’s real economic fundamentals.

The debt issue is high on the agenda of the African Union. The organisation convened a special meeting on the debt issue in Lomé, Togo, in May 2025, with the aim of finding a solution to the continent’s crippling debt. Senegal is among the countries struggling with a choking external debt.

The scandal of the hidden debt

Senegal is embroiled in a very complex debt situation, following the discovery of a hidden debt estimated at 25 per cent of the country’s GDP. According to data submitted by the previous government, at the end of 2023, the debt-to-GDP ratio stood at 74.4 per cent. However, the data released by the Court of Auditors shows that the ratio was 99.7 per cent. (The latest statistics indicate a ratio of 118.8 per cent at the end of 2024.) This revealed a hidden debt of 25 per cent of GDP whose origin can be traced to the rise in private debt as shown in the table below.

Table: Eurobonds issued by Senegal (2009–2024)

Source: Le Marché (monthly magazine)

Senegal issued several Eurobonds starting in 2009. This accelerated from 2014 following the adoption of then President Macky Sall’s “Plan Sénégal Emergent” (“Emerging Senegal Plan”) and contributed to raising the share of private debt in the overall public debt. It also raised the cost of servicing debt. 

The current administration has issued several bonds at the Regional Securities Exchange (BRVM) based in Abidjan, Côte d’Ivoire. According to the latest report on budget execution for the second trimester of 2025, Senegal borrowed nearly 3 billion US-Dollars from the BRVM, accounting for 74.6 per cent of all the cash raised during this time.

Why the hidden debt?

The scandal reveals both a lack of transparency and the weakness of institutional oversight despite the Code of Transparency for the management of public finances issued by the West African Economic and Monetary Union (WAEMU) for its member countries through the Guideline 01/2009/CM/UEMOA and which was integrated into Senegal’s domestic legal framework through Law 2012-22 adopted in December 2012.

One of the consequences of the scandal is the loss of public trust in the statistics released by government institutions.

The revelation of the hidden debt was a shock to ordinary citizens who wondered how this could happen over a period of three years without being detected. Citizens and civil society organisations (CSOs) are calling for full accountability for the hidden debt and punishment of those responsible for the scandal. (A petition initiated by CSOs is calling for the cancellation of the hidden debt considered to be “illegitimate” or even “odious”.) This is seen as indispensable to restore trust in public institutions and in the statistics published by government agencies.

One of the most conspicuous consequences is the suspension of disbursements by the International Monetary Fund. However, a new round of discussions took place in Senegal between 19 and 26 August 2025 with a view to negotiating a new programme.

The IMF’s suspension of disbursements compelled the government to turn to the regional market to raise funds. The same report indicates that funds from banking and financial markets accounted for 74.6 per cent of all the cash resources raised during the second trimester by the government.

Weak institutional oversight

As mentioned earlier, the hidden debt has also exposed the weaknesses of institutional oversight, which aims to ensure transparency and the proper management of public finances. Among the key oversight organisations are public institutions, parliament, and CSOs such as the Citizens’ Network for Budget Transparency. 

Most public oversight institutions have limited independence because their members are nominated by the president or the prime minister.

The author notes two key limitations of the Senegalese parliament regarding the budget process. First, most members of parliament do not understand budget processes. Second, the parliament is usually a rubberstamp institution because the ruling party or coalition controls the assembly, which is then reluctant to scrutinise what the government does. As for CSOs, most of them have limited knowledge of budget processes and limited access to debt statistics. Therefore, both the parliament and CSOs have a weak oversight capacity.

To overcome the identified weaknesses and improve transparency and institutional oversight in debt management, several key recommendations are proposed. First, it is crucial to enforce compliance with the new legal framework on transparency and accountability, ensuring that all relevant institutions adhere to established laws aimed at enhancing openness in financial operations. This will build trust and reduce the risks of mismanagement. Secondly, compliance with the WAEMU Guideline on transparency in debt management should be prioritised. These guidelines promote timely, comprehensive, and accessible reporting on public debt, enabling better risk management and public scrutiny.

Reinforcing the independence and resources of oversight institutions is essential so that bodies responsible for monitoring debt operations can function effectively without undue influence, thereby supporting objective assessments. Similarly, the National Committee on Public Debt should have its role strengthened to coordinate debt management strategies and foster inter-institutional collaboration.

Capacity-building initiatives are also recommended to empower key stakeholders. Members of parliament should participate in workshops with budget and debt experts to enhance their understanding of complex debt issues, enabling them to play informed legislative and oversight roles. Providing members of parliament with parliamentary assistants would further support their technical capacity. Additionally, empowering CSOs through targeted training will enhance their ability to analyse and disseminate budget and debt statistics, fostering public participation and watchdog functions. CSOs should be encouraged to make full use of new laws that facilitate transparency, thereby increasing access to critical fiscal information.

Together, these measures create an ecosystem where transparency, accountability, and informed oversight work hand in hand to ensure prudent debt management aligned with national development priorities. This approach aligns closely with international best practices on debt management transparency promoted by the IMF, World Bank, and WAEMU frameworks, which emphasise comprehensive reporting, institutional capacity, and stakeholder engagement as pillars of sound public debt management.

One of the lessons learned from the scandal of the hidden debt in Senegal is the necessity to restore credibility to public policies and statistics.

This is why the new authorities have taken steps to reinforce transparency in the budget process and strengthen institutional oversight. To that end, two bills were adopted by the national assembly, one to protect whistleblowers and one to facilitate public access to information. If these laws are correctly implemented, one may expect more transparency, accountability and stronger oversight mechanisms, which will effectively eliminate the possibility of concealing external debt statistics.

The views and analyses expressed in this publication are those of the author and do not necessarily reflect the views of the Heinrich Böll Foundation.