# Presentation: 055524

## Business Opportunities in SenegalWest & Central Africa

***    *****Presenter:  Cynthia Griffin-Greene****	****	****  Regional Senior Commercial Officer****	****	****  Dakar, Senegal**

**Business Opportunities in Senegal****West & Central Africa**

**Notes:**
IMF figures (Central Bank confirmed)

## Basic Statistics for Senegal

**Business Opportunities in Senegal****West & Central Africa**

- 12 million population
- GDP per capita $1,800 (ppp)
- GDP growth rate has averaged 5% over past 10 years- declined 2% 2006 (power shortages)
- Imports:  $3.3 billion (2006)
- Exports:  $1.5 billion (2006)

**Notes:**
IMF figures (Central Bank confirmed)

## Senegal’s Economy

- Senegal’s GDP Composition by Sector

**Notes:**
Senegal’s agricultural sector employs 75% of the population.  Senegal grows peanut (groundnuts), cotton, green house tomatoes and green beans.  Senegal is a major fish exporter. Industry consists of mining—phosphate (for fertilizer), iron ore, and to a lesser extent gold.  SAR refines crude oil.  While natural gas has been discovered and tapped by U.S. company Fortesa, oil exploration in Senegal is truly nascent.  The services industry is made up of the telecommunications sector, tourism, banking, and insurance.

## Senegal’s Imports

-  Food & Beverages (rice, powdered milk products, wheat )
- Capital Goods (vehicles)
- Fuels (crude oil, butane, refined petroleum products-Nigeria)

## Senegal’s Import PartnersImports: $3.3 billion (2006)

**Notes:**
According to U.S. Department of Commerce figures, the U.S. exported $157.8 million to Senegal in 2005, up $89.2 million in 2004.  This represents a mere 0.068 percent of Senegal’s imports.

## Senegal’s Export PartnersExports: $1.5 billion (2006)

**Notes:**
India is the sole destination for all of Senegal’s phosphate exports-- though some phosphates were exported to Mali and The Gambia this year.  ICS—Industries Chimique du Senegal has experienced financial difficulties over the past couple of years, has seen operations halted and is USD 200 million in debt.  It is our understanding that the state-owned entity is operating at approx. 25 percent capacity and is currently in discussions with its Indian clients to sell the parastatal.
 Agricultural exports are destined for Europe.  Senegal and the EU are still in the midst of negotiating a new fisheries agreement.  The current four year agreement expired at the end of June 2006.  The agreement provided for an annual compensation of $15 million for the right to fish in Senegal’s waters.    

In 2005, Senegal exported $ 3 million products to the U.S. under AGOA (African Growth & Opportunity Act)—legislation passed by Congress in 2000 whereby more than 6,000 products manufactured or produced in sub-Saharan Africa can be exported to the U.S. under duty free status.  Last year, the export of peanut oil to the U.S. jumped noticeably from zero in 2005 to $14.3 million in 2006.  There was also an increase in the export of yellow fin tuna to the U.S. from $69,000 in 2005 to $1.4 million in 2006.

## Best Prospects for U.S. products

- Telecommunications products
- Construction Equipment and Materials
- Power generators (electrical power systems)
- Mining Equipment

**Notes:**
In 2005, Senegal had 1.5 million cellular phone subscribers.  With the telecommunications industry on the cusp of liberalization, opportunities abound for VOIP and broadband wireless services.

While e-commerce is in the very early stages, Senegalese companies are slowly beginning to use webpages as a form of marketing.  B2B commerce or financial transactions over the internet are non-existent.

“All of Senegal is a construction site”.....this phrase is often heard amongst those living in the capital city of Dakar especially.  Major road networks are being built with the assistance of the Kuwaitis and funds from the Organization of Islamic Conferences,  the transportation network will include bridges and tunnels throughout the city.  Once Senegal signs a compact with the Millennium Challenge Corporation,  a Presidential Initiative, Senegal stands to gain an injection $450 million for the development of a large scale industrial, commercial and residential site referred to as the Diamniadio Platform.   U.S. and local companies can look forward to participating in what promises to be a massive infrastructure project.   Additionally, Senegal plans to build a new international airport adjacent to the Diamniadio platform in Ndiass.

## Millennium Challenge Corporation

- Contact:
- 	Country Director
- 	Madolyn Phillips
- 	Email: _[phillipsmc@mcc.gov](mailto:phillipsmc@mcc.gov)_
- 	Tel: 202-521-3608

## SWOT Analysis for Senegal

- _Strengths_
- Relatively strong telecommunications infrastructure
- Investment Code
- Agency for Import Promotion (APIX)

-  _Weaknesses_
- French labor codes
- Horrendous traffic congestion
- Burdensome & frequent tax audits
- Non-transparent judiciary

## SWOT continued

- _ __Strengths_
- Interest in doing business with the U.S.
- Sophisticated consumer

- _ __Weaknesses_
- Corruption
- Limited IPR protection
- Lack of Steering or Coordination Committee to “champion” reforms in Senegal

**Notes:**
These weaknesses were identified by the business community in Senegal and are issues being addressed with the GOS through the Private Sector Working group of the Donor Community.

## Opportunities & Threats

-  _Opportunities_
- Senegal can position itself as a hub for the WAEMU countries
- One of the more stable countries in this economic grouping
- Transportation hub

-  _Threats_
- Overpopulation in Dakar
- 75% of industry is located on the peninsula of Dakar—deterrent to investment
- Insufficient power

**Notes:**
The eight WAEMU countries include: Benin, Burkina Faso, Cote D’Ivoire, Guinea Bissau, Mali, Niger, Senegal and Togo.  Within the region, Senegal is one of the most stable countries, economically and politically.  Senegal has the largest economy after Cote D’Ivoire.  This economic group is establishing a CET (Common External Tariff) on imports and seeks to harmonize the classification of all imports.   They also manage a regional stock exchange based in Abidjan—majority of listed companies are Ivoirian.  The zone has a population of 74 million, real GDP growth of 1.6 percent on average.

## Best Prospects for U.S. products

- Telecommunications products
- Construction Equipment and Materials
- Power generators (electrical power systems)
- Mining Equipment

**Notes:**
As Senegal does not have sufficient power reserves, generators are highly sought during power outages...which is a relatively frequent occurrence when Senegal’s obsolete power stations experience failures.  Senegal is in the process of reviewing it energy sector with assistance from the Chinese and Moroccans.

On the mining front, Senegal mines phosphate and iron ore.  Indian company Mittal is expected to make a $1 billion infusion into Senegal’s iron ore parastatal Miferso, which estimates that yearly output could reach 12 million tons.  The U.S. Trade & Development Agency will conduct a feasibility study on the construction of a new multi commodity port to accommodate the export of phosphate and minerals from Senegal.

## CS Dakar: Tel: (221)-823-4296 / Fax: (221)-842-9821
			   www.buyusa.gov/westafrica

*Contact Us*

_**CS Dakar**_**: Tel: (221)-823-4296 / Fax: (221)-842-9821**
**	****	****	****   ****www.buyusa.gov/westafrica**

- Marie Paule Ngaleu, Com. Assist., Marie.Paule.Ngaleu @mail.doc.gov

- Steven Morrison, SCO: Steve.Morrison@mail.doc.gov

- Medina Sy, Administrative Assistant: Medina.Sy@mail.doc.gov

- Cynthia Griffin-Greene, RSCO: Cynthia.Griffin.Greene@mail.doc.gov

- Youhanidou Wane Ba, Com. Spec: Youhanidou.Wane.Ba@mail.doc.gov

_**CS Abidjan**_: **Tel: (225) 2249-4507/4406 / Fax (225) 2249-4525**

- Victorine Kabran, Admin. Assistant, Victorine.Kabran@mail.doc.gov

_**Incoming SCO**_:

**Notes:**
As Senegal does not have sufficient power reserves, generators are highly sought during power outages...which is a relatively frequent occurrence when Senegal’s obsolete power stations experience failures.  Senegal is in the process of reviewing it energy sector with assistance from the Chinese and Moroccans.

On the mining front, Senegal mines phosphate and iron ore.  Indian company Mittal is expected to make a $1 billion infusion into Senegal’s iron ore parastatal Miferso, which estimates that yearly output could reach 12 million tons.  The U.S. Trade & Development Agency will conduct a feasibility study on the construction of a new multi commodity port to accommodate the export of phosphate and minerals from Senegal.