SENEGAL UNDER PRESSURE: IS RELIANCE ON THE WAMU FINANCIAL MARKET SUSTAINABLE?

Dr. Marieme Toure and Dr. Ndongo Samba Sylla –

Unsustainable Regional Market Reliance: In 2025 alone, Senegal raised 2,225 billion CFAF on the West African Monetary Union (WAMU) market, paying interest at some 7.5 percent on
medium-term instruments, with outstanding debt multiplied 4.8-fold in six years and average debt maturity of just 2.32 years.

A Structural Ceiling on Regional Financing: WAMU regional financing is not a substitute for hard currency borrowing. In the context of the CFA franc’s fixed euro peg and the WAMU zone’s chronic external deficits, expanding CFAF issuances structurally depends on continued foreign currency indebtedness, imposing a hard ceiling on the regional market’s capacity to meet Senegal’s financing needs.

The Need for a New Monetary Architecture: The WAMU framework offers no durable exit from Senegal’s debt trap. The country thus faces a fundamental choice between remaining bound to a monetary system that subordinates development to exchange-rate defense or pushing for monetary architecture in which the central bank serves as both a guarantor of public solvency and an engine of structural economic transformation.

This Policy brief is part of the editorial series published during the Experts meeting and International Conference organized by IDAN on Senegal’s debt Crisis (11 to 13 May,Dakar,Senegal).