The first female presidential candidate and brief fears that its democracy may be in peril made for a more eventful Senegalese election than many were anticipating. In light of this recent contest, the Daily Update took a look at the country’s trade profile.
Contenders
The main opposition candidate looks set to emerge victorious, with Bassirou Diomaye Faye projected to have won over 50% of the vote. Faye stepped in for the original candidate, Ousmane Sonko, who is currently standing trial for defamation. Both men are from a tax administration background, adding credibility to their anti-corruption campaign in the eyes of the electorate and boosting their popularity ahead of the vote.
Commentators believe a Faye presidency would mark a turning point for the country, with other progressive promises, such as reforming the country’s mining and energy sectors, and tackling high unemployment, marking a departure from incumbent Macky Sall.
Sall’s pick, former prime minister Amadou Ba, conceded defeat yesterday (25 March) despite the provisional results not being released until the end of the week. His continuity platform received dwindling support in the run-up to the vote – harmed further by a bid by Sall to delay the election until December.
The contest also saw its first female candidate, Anta Babacar Ngom, who runs the country’s largest poultry company. Although not predicted to win, Ngom’s campaign has been reported as having an uplifting effect on the electorate, especially young women and girls. Speaking to AP ahead of the vote, Ngom said:
“The young girls I meet ask for my support. They do so because they know that when a woman comes to power, she will put an end to their suffering. I’m not going to forget them.”
Controversy
Protests were held in Senegal when Sall tried to postpone elections, with many fearing an attempt to circumvent the country’s two-term limit for president.
Senegal’s top court – the Constitutional Council – overrode Sall’s decision and the election was scheduled to be held last Sunday (24 March).
Last week (20 March) Sall told the BBC: “I have no apology to make, I have done nothing wrong,” and went on to claim “the actions that have been taken have been within the framework of the law and regulations”.
However, speaking to Al Jazeera, NDongo Samba Sylla, head of research and policy for political and economics network IDEAs, said that Sall’s actions have damaged Senegal’s reputation for stability:
“People want Senegal to set the tone for the rest of the region and they want to make it clear that when your mandate is over you have to go.”
Many are calling for institutional reform in Senegal to introduce greater checks and balances, with the recent scare leading many to claim too much power is concentrated in the presidential office.
Economy
Senegal is one of the fastest growing economies in the region. Excluding the pandemic years, it experienced an average of 5% growth over the past decade.
This has been bolstered in recent years by an IMF loan of $1.9bn and new natural gas projects, which have led to double-digit growth forecasts for next year.
But despite the boost to the country’s coffers, the spoils have not been distributed evenly. Inequality was one of the most prominent campaign issues ahead of Sunday’s vote. Approximately a third of the population live below the poverty line, with the younger generation facing a lack of prospects. Among the country’s youngest adult cohorts, aged 18–35, the unemployment rate is currently 30%.
This has been identified as one reason so many young people leaving the country, often using unsafe routes. Spanish migration watchdog Walking Borders reports that nearly 1,000 people died in this way in the first half of 2023.
Trade
Senegal’s trade profile is made up predominantly of raw material exports, according to the Observatory of Economic Complexity (OEC). Its top export, gold, was worth US$961m in 2022, followed by phosphoric acid, used primarily to make fertilisers and process aluminium, at $846m. Other precious metal products, which can include precious and semi-precious stones, imitation jewellery, coins and cultured pearls, were worth $328m to the economy.
The mining industry that supports this trade is highly controversial. The government has incentivised international companies to invest, contributing to the country’s growing wealth, while worker conditions have remained poor. Safety is frequently neglected, with injuries, falls and lethal landslides often deadly, while pay is sporadic, with some workers not receiving a wage, but instead hoping to strike lucky and take home a significant cut for finding a large nugget of gold.
Oil is the country’s third-largest export, with refined petroleum from its sole plant, Société Africaine de Raffinage (SAR), worth $824m in 2022.
Part-owned by the government, along with Shell and Total, SAR has been in advanced talks with the African Export-Import Bank about a $500m loan to upgrade production. With crude oil prices spiking after Russia’s invasion of Ukraine, the discovery of oil and gas fields in Senegal and the potential for a reduction in imports, makes this a lucrative proposition.
The OEC reports that bordering nation Mali remains the country’s biggest export partner, with imports from China, worth over $3.6bn, its highest-value trade partner.
Boosting trade
Eugene Waluvengo, the Institute of Export & International Trade's (IOE&IT) Africa lead, adds that a key driver of growth for Senegalese trade is its Small and Medium Enterprises (SMEs), which account for 90% of the country's businesses.
In order to spur further growth he says:
"A business climate conducive to further growth would include an enabling tax regime and other business-friendly policies. These are key to support Senegal’s SMEs.
"International trade and business development training are also needed to enable increased trade participation from SMEs. By taking advantage of the trade concessions offered by the Africa Continental Free Trade Area (AfCFTA), Senegal should also be able to engage more in intra-African trade."
UK-Senegal trade
Current trade between the UK and Senegal stands at £610m, most of which is made up of UK exports to Senegal, worth £438m, according to Department for Business and Trade figures covering the 12 months to September 2023.
Bilateral trade has increased 73.8% on the previous year, with UK imports from Senegal seeing the biggest increase (89%), rising from £91m to £172m.
While UK goods exports to Senegal represented the largest value of any single trade category, worth £241m, trade in services between the two countries also rose dramatically over the past year. UK services exports rose to £197m in the year to September 2023, a staggering increase of 479.4%. Senegalese services exports also rose 187.2%, reaching £112m.
In the Institute of Export & International Trade’s (IOE&IT) Doing Business Handbook for Senegal, director general, Marco Forgione, noted “there are huge opportunities to tap into [Senegal’s] rapidly maturing economy, with consumer and business demand rising across a wide range of sectors.”
He added that, because “most UK exports to Senegal by value are accounted for by just two products - refined oil and gas, account[ing] for almost 60% of UK exports to Senegal” there’s excellent opportunities to diversify. The handbook highlights sectors such as telecoms, insurance, IT, construction, automotive and transport as holding strong prospects for firms and investors.
The IOE&IT Doing Business Handbook for Senegal is available to download now.
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