Senegal’s hidden debt — a 25-point restatement of the country’s debt-to-GDP ratio by its own state auditors — is now landing on bondholders, and on the multilateral institutions that never noticed.
Senegal’s hidden debt has moved from an accounting scandal to a bill somebody has to pay. On September 4, S&P Global Ratings cut Senegal’s long-term foreign-currency sovereign rating to “CC” from “CCC+,” its lowest assessment of the West African state in more than two decades, and said a default or distressed debt exchange on the country’s foreign-currency commercial debt was “extremely likely.” The local-currency rating fell to “CCC.” Both outlooks are negative.
Three days earlier, the International Monetary Fund had announced something that reads, on its face, like the opposite kind of news: a staff-level agreement on a 36-month Extended Credit Facility of roughly $2.2 billion, equivalent to about 475 percent of Senegal’s quota at the Fund. The agreement remains subject to approval by IMF management and the Executive Board.
The two announcements describe the same problem from opposite ends. For at least six years, according to Senegal’s own state auditors, the government reported one set of fiscal numbers to its creditors and to the multilateral institutions lending it money while the real numbers sat elsewhere. The audit that surfaced the gap is public. The question of who absorbs it is being negotiated in Washington, Dakar and, as of this week, Abu Dhabi.
Inside Senegal’s Hidden Debt: An Audit That Moved 25 Points of GDP
The document at the center of the case is the final report of Senegal’s Cour des Comptes, the national court of auditors, published on February 12, 2025 and covering public finances from 2019 through March 2024. The audit was ordered by President Bassirou Diomaye Faye after he took office in April 2024, and it examined the fiscal record of the administration of his predecessor, Macky Sall.
The findings, as reported by the court:
- Public debt at end-2023 was restated at 99.67 percent of GDP, against the 74.41 percent previously reported — a revision of more than 25 percentage points.
- The 2023 fiscal deficit was restated at 12.30 percent of GDP, against the 4.9 percent originally published by the previous administration — a revision of roughly 741 basis points.
- “Hidden” deficits averaged approximately 5.5 percent of GDP between 2019 and 2023, implying true overall deficits near 11 percent of GDP across the period.
- The court identified incomplete accounting of contracted loans, irregular treasury practices, and off-budget bank debt.
Subsequent revisions pushed the figures higher. Following a staff visit in November 2025, the IMF estimated Senegal’s total public debt at 132 percent of GDP at end-2024 — more than $43 billion — against an estimate of roughly 80 percent two years earlier. The Fund’s mission chief told RFI at the time that he had never seen hidden debt of that magnitude in Africa. Senegal’s own finance ministry, in its 2026–2028 medium-term debt strategy, put end-2024 public debt at roughly $39 billion, or 119 percent of GDP, including about $26 billion in external debt.
The Cour des Comptes report is an audit document, not a prosecutorial one. Its conclusions describe systems and accounts rather than individual culpability, and no criminal findings have been established against named former officials in connection with the misreporting.
The Creditors Nobody Counted
The more revealing question is not how much was hidden but from whom — and here the data are unusually clean, because each annual vintage of the World Bank’s International Debt Statistics restates prior years. Comparing the 2025 edition against the 2024 edition shows where loans went unreported.
An analysis of those two vintages by the Finance for Development Lab, a Paris School of Economics–affiliated research group, found Senegal’s reported external public and publicly guaranteed debt for 2023 stood at $17 billion while the restated figure was $5.5 billion higher. On those figures the undisclosed borrowing amounts to roughly a quarter of the restated external debt stock of $22.5 billion, or about 32 percent measured against the $17 billion Senegal had reported; the Lab characterizes it as more than a third. Either way it represents about 16 percent of GDP. Research published as an NBER working paper puts the average revision across developing-country debt data at roughly 1 percent. Senegal’s gap is comparable in scale to Zambia’s in 2021, the year after that country defaulted.
The composition of the gap is where the international dimension sits. Of the roughly $5.5 billion in missing external debt identified in the IDS comparison:
- Bilateral lenders account for about $2 billion. Chinese loan disbursements were undercounted by roughly $1 billion across the period; French disbursements by about $500 million, concentrated in 2020 and 2023.
- Private lenders account for roughly $1.8 billion, with French, Ivorian and Chinese banks recording the largest unreported transaction volumes.
- Multilateral lenders follow closely, with the Islamic Development Bank, Afreximbank and the West African Development Bank (BOAD) showing the largest unreported loan flows.
Critically, most of these were not secret projects. The analysis found that commitment data — the signing of loan agreements — was largely reported correctly. What went unrecorded was the money actually moving. A $430 million Afreximbank facility, for instance, was reported in the trade press in 2023 at close to the expected amount. The loan was public; the disbursement was not.
That distinction matters because it means the discrepancy was detectable from public data. Cumulative loan commitments between 2018 and 2023 reached 84 percent of GDP, among the highest ratios in the developing world, while apparent disbursements ran at 51 percent. The two figures normally track each other reasonably closely outside fragile-state contexts. In Senegal they diverged, and kept diverging, in figures available to anyone who looked.
The current external stock, on restated numbers, is heavily multilateral: roughly $10 billion, or about 40 percent, is owed to multilateral institutions, with bilateral claims, Eurobonds and non-bonded commercial debt at roughly $5 billion each. Among official bilateral creditors, China holds approximately 43 percent of claims and France about 30 percent, with Japan at 5 percent. That is a fragmented creditor base with significant non–Paris Club participation — the configuration that made the Zambian, Chadian and Ghanaian restructurings slow, and one this publication has documented across China’s broader lending footprint in Africa.
“Hidden Debt 2.0”
The reform government that commissioned the audit has faced questions of its own. In March 2026, the Financial Times reported that Senegal had borrowed roughly €650 million during 2025 through total return swap agreements with the Africa Finance Corporation and First Abu Dhabi Bank — transactions not disclosed in published debt statistics. Bank of America estimated total swap-based borrowing that year at up to $1 billion, and documentation reviewed by the FT pointed to a further arrangement involving Société Générale.
As summarized in subsequent analysis of that reporting, the structures followed a consistent template. In the AFC transaction, Senegal issued roughly €150 million in domestic CFA-franc bonds and transferred legal title to the lender, receiving about €105 million in euro cash — an upfront discount near 30 percent. The FAB deal pledged approximately €400 million in bonds against €300 million received. Both mature in 2028, at a floating euro rate plus a fixed margin reported at 3.5 to 4 points on the AFC leg and about 5 points on the FAB leg.
The IMF has said it was aware of the swaps but that their terms were not shared with the Fund, disclosure ordinarily required to complete a debt sustainability analysis. Private bondholders have said they learned of the transactions through informal ministry meetings. Dakar publicly disputed the characterization of the borrowing as secret when the reports appeared. Analysts have argued the structures leave Senegal retaining downside exposure while surrendering upside on the pledged bonds — a reading that remains an interpretation, since the margining terms have not been made public. Reporting on the FAB transaction indicates it carries early-repayment provisions triggered if Senegal falls below CCC+ at S&P or Caa1 at Moody’s. Both thresholds have since been crossed.
Who Absorbs the Loss
On the same day the IMF announced its staff-level agreement, Senegal’s finance ministry launched what it calls the Senegal Debt Treatment Plan, telling official partners it intends to use the G20 Common Framework in an “enhanced” form — compressed timelines and parallel creditor talks rather than the sequential process that consumed years in Chad, Zambia and Ghana.
The perimeter is the contested part. CFA-franc-denominated debt has been excluded, on the stated grounds that the regional WAEMU market finances both the state and the wider economy. That exemption shields roughly a third of the debt stock, including most of the CFAF 4,307 billion in principal falling due this year. It also narrows the pool of claims across which relief can be spread, concentrating the burden on external creditors — bilateral lenders, commercial loans, and close to $5 billion in Eurobonds, roughly $1.1 billion of which matures between 2026 and 2028.
Bondholders have organized accordingly. An ad hoc creditor group was formally announced on September 11 with White & Case as legal adviser. Bloomberg has reported investor projections of losses as much as 60 percent below par, while Citi’s modeling has placed foreign-bondholder recovery between 43 and 50 cents on the dollar. Senegal’s bonds have traded below half their face value. Asking Paris Club members and China to accept losses while regional bondholders are protected by design runs into the comparability-of-treatment principle official bilateral creditors apply — an argument harder for Dakar to win than the timetable.
The Fund’s own position carries an unresolved question. Because Senegal received disbursements under earlier programs on the basis of figures now known to be wrong, the Executive Board must address a misreporting case — either granting a waiver or requiring repayment of funds already advanced. Public reporting indicates the Fund has not sought immediate repayment, a departure from precedents such as Mauritania in the 2000s; the August 2025 staff visit was explicitly framed around corrective measures. The United States is the IMF’s largest shareholder, and American emerging-market funds are among the institutional holders of the paper now inside the restructuring perimeter.
Meanwhile, Dakar is raising money elsewhere. IMF Managing Director Kristalina Georgieva praised Senegal’s debt-treatment plan in Washington on September 15. The following day, President Faye met UAE President Sheikh Mohamed bin Zayed in Abu Dhabi to discuss a partnership spanning finance, infrastructure, energy and logistics. Emirati exposure already exists — the First Abu Dhabi Bank swap, a small volume of bilateral debt in World Bank data, and DP World’s $1.2 billion Ndayane deepwater port project. Whether any of those claims fall inside the debt treatment has not been made public.
What Remains Open
The evidence trail supports a narrow conclusion: Senegal’s published accounts diverged materially from its actual obligations for roughly six years, the divergence was large enough to be visible in public World Bank commitment-versus-disbursement data, and neither the Fund’s surveillance function nor the creditor-side reconciliation exercises conducted in 2023 and 2025 caught it. The Finance for Development Lab analysis characterizes this as a failure of the system to cross-validate its own data — a finding about institutional process, separate from whatever decisions were made inside the Senegalese treasury.
Several things remain unknown. The full terms of the 2025 swap agreements have not been disclosed. The perimeter of non-bonded foreign-currency commercial claims has not been published. The G20 has agreed to nothing resembling an accelerated Common Framework, a mechanism whose record on earlier African debt treatments is mixed. And the growth backdrop has deteriorated — Senegal’s finance ministry now projects real growth of 2.7 percent in 2026, against 6.5 percent in 2024 and 6.7 percent in 2025, even as the deficit has been cut from 13.4 percent of GDP to 6.4 percent.
The date worth watching is the day the program reaches the IMF Executive Board, when the waiver decision, the financing assurances and the shape of the creditor perimeter all become matters of record rather than negotiation. Neither the Senegalese Ministry of Economy, Finance and Planning nor the IMF has issued a public statement addressing the swap disclosure question beyond the Fund’s acknowledgment that the terms were not provided.