Moody’s Ratings downgraded Senegal’s foreign-currency credit rating to Ca from Caa2, warning that bondholders could face losses between 35% and 65% as the West African nation restructures billions in external debt. The agency stated that meaningful relief beyond liquidity-driven reprofiling is essential to restore debt sustainability. Senegal announced the debt revamp in September following a staff-level agreement with the IMF for a $2.2 billion program aimed at regaining access to international capital markets.
Moody’s noted that excluding local-currency debt — about one-third of central government debt — would concentrate losses on remaining creditors, including external-private holders. Market pricing has already reflected Ca-consistent losses since the early-September announcement. Senegal is Africa’s most distressed sovereign issuer, with its risk premium over US Treasuries at 1,447 basis points, per JPMorgan Chase & Co. data.
Since the plan’s announcement on Sept. 1, Senegal’s eurobonds have traded around 50–52 cents on the dollar, dipping lower amid a budget impasse delaying IMF board approval.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing