Senegal Secures Funding to Cover Eurobond Payments Due March
Photographer: Abdel Majid Bziouat/AFP/Getty Images
Takeaways by Bloomberg AI
- Senegal secured sufficient funding to meet eurobond payments due in March, easing investor anxiety about the government’s ability to service its dollar-denominated debt.
- The West African nation raised funding in regional debt markets and is on track to meet the almost $485 million of payments, according to people familiar with the matter.
- Senegal’s dollar bonds due 2048 and 2031 extended gains on the news, rising as much as 0.48 cent on the dollar to 57 cents and 1.3 cents on the dollar to 67.4 cents, respectively.
Senegal secured sufficient funding to meet eurobond payments due in March, according to people familiar with the matter, easing investor anxiety about the government’s ability to service its dollar-denominated debt.
The West African nation is on track to meet the almost $485 million of payments after it raised funding in regional debt markets, said the people who asked not to be identified because they’re not authorized to speak about the matter publicly.
A spokesperson for Senegal’s finance ministry declined to comment. An economy ministry spokesman wasn’t immediately available to comment.
Senegal’s dollar bonds due 2048 extended gains on the news, rising as much as 0.48 cent on the dollar to 57 cents at 2:38 p.m. in London. The sovereign’s dollar bonds due 2031 advanced 1.3 cents on the dollar to 67.4 cents and were among the top performers in emerging markets.
Next month will be a key test of whether Senegal can manage its debt without resorting to restructuring. Prime Minister Ousmane Sonko has repeatedly rejected calls to overhaul the country’s obligations, insisting the government can meet rising repayments by tapping regional loan markets.
Investor unease has shadowed President Bassirou Diomaye Faye’s administration since the discovery in 2024 of about $7 billion in previously undisclosed debt — including about $5 billion in external loans — accumulated by the previous government. That led the International Monetary Fund to suspend a $1.8 billion funding package.
Senegal lagged the broader rally in emerging market debt in January because of concern about its near-term liabilities. It’s the only African nation that remains in distress territory as its risk premium over US Treasuries trades at 1,151 basis points, according to JPMorgan Chase & Co. data.
Read More: Two African Debtors Exit Distressed Club, Leaving Only Senegal
The country must pay about $485 million on its eurobonds next month, part of about $1.3 billion of payments falling due across its obligations. The eurobond payments include a $33.8 million coupon on its 2048 debt, a €333.3 million ($394 million) principal repayment on its 2028 euro-denominated bond, and a €47.5 million coupon on that issue, according to data compiled by Bloomberg.
Morgan Stanley said last week that at least some of its clients were unsure about whether Senegal would be able to make the payments.
In the first five weeks of 2026, the government raised 510 billion CFA francs on the regional market and plans to offer another 490 billion CFA francs before the end of the first quarter, Senegalese budget documents and data from the regional UMOA-Titres debt market show. Successful auctions would provide more than enough liquidity to cover the payments that must be made in March.
“They are fine for March eurobond payments as they exceeded” debt auction targets so far this year, “but they have only been able to keep a lid on bond yields mostly by shifting issuance sizes towards bills,” said Mark Bohlund, senior credit analyst at REDD Intelligence. “That could cause a problem in the second half of the year.”
Beyond the funding raised in the region, the government also last week secured a €630 million trade-finance facility from the International Islamic Trade Finance Corp., bolstering funding for imports of essential commodities.
Read More: Senegal Lands €630 Million Deal With ITFC for Commodities
Senegalese dollar bonds maturing in 2028, which traded at an almost one-third discount to par in December amid concerns about credit-rating downgrades, delays in securing a new IMF program and fears of a potential restructuring, have made a strong comeback this year and almost recovered all of their losses.
— With assistance from Srinivasan Sivabalan, Kerim Karakaya, and Ray Ndlovu
(Updates with bond market reaction in fourth paragraph
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