The economic landscape of Senegal faces a stark contrast: while its potential remains undeniable, the country is grappling with a dramatic decline in foreign direct investments (FDI). After averaging three billion dollars annually over four years, FDI plummeted to just 37 million dollars in 2025, according to the latest report from the United Nations Conference on Trade and Development (UNCTAD). Is this a sign of waning investor confidence, or merely a temporary dip following a surge in major projects?
Cyclical dip or structural decline?
The drop in FDI is largely cyclical. Massive inflows over recent years were driven by flagship oil and gas projects like Sangomar and Grand Tortue. Now that the bulk of these investments has been deployed, the focus has shifted to production. However, Senegal could have attracted far more than the 37 million dollars recorded in 2025, argues Moubarak Lo, former economic advisor to the Prime Minister and now a consultant.
“Structurally, Senegal can sustain three to five billion dollars in annual investments,” he explains. “But this requires aggressive promotion of the economy. The country lacks a dedicated network for attracting foreign investors abroad—unlike other nations. Roadshows alone are insufficient. Waiting passively won’t suffice; proactive engagement is essential. While Senegal excels in portfolio investments, such as government bonds or treasury bills, it falls short in direct investments. A strategic overhaul is urgently needed.”
Debt concerns overshadowed by lack of clarity
Senegal’s staggering public debt—estimated at 132% of GDP by the end of 2024, per the International Monetary Fund (IMF)—might theoretically deter investors. Yet, in practice, private investors remain unfazed by debt levels, as seen in countries like France, which attracts significant private capital despite a public debt exceeding 3.5 trillion euros.
According to Justin Maria, Director of Access Bank in France, the real deterrent is the absence of economic visibility. “Senegal is now perceived as a high-risk destination—not due to long-term fundamentals, which remain solid, but because short-term financial clarity is lacking. Uncertainty about public finances and liquidity is what’s holding investors back.”
Can Senegal regain investor trust?
Moubarak Lo dismisses the “high-risk” label, asserting that Senegal possesses the tools to swiftly restore its appeal. The IMF suspended its program with Dakar at the end of 2024, but negotiations are ongoing. “The country has over two dozen major projects in the pipeline,” he notes. “Each project must be paired with targeted outreach to the top five or six global companies capable of investing. With focused effort, Senegal could recover its momentum as early as this year—or, more realistically, by 2027.”
While Senegal struggles, other nations in the region have seen their FDI inflows rise. In 2025, Guinea led the pack, securing over 7.7 billion dollars in foreign investments, according to UNCTAD’s report.
