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Senegal

Situation and cooperation

Plane at the Leopold Sedar Senghor airport in Dakar, Senegal, with the African Renaissance monument in the background

In the spring of 2012, Senegal was able to cement its reputation as a stable democracy in an otherwise troubled region of Africa when the country elected Macky Sall as its new president in peaceful and transparent elections. The election campaign was blighted by fierce, and sometimes violent, protests against the incumbent president, Abdoulaye Wade, who was standing for a third term in office, which was deemed to contravene the constitution. Voters, especially young voters, also protested against the corruption and mismanagement which had characterised the latter years of Wade's presidency. Nevertheless, the elections themselves were peaceful, as was the handover of power. The party alliance led by President Macky Sall won the parliamentary elections in 2017 by a wide margin.

The President is faced with considerable domestic policy challenges. Nearly half of Senegal's people live in poverty, and more than ten per cent of the people are considered to be undernourished. According to the World Food Programme (WFP), food insecurity affects 17 per cent of the population. Incomes are distributed very unequally, with poverty especially pronounced in rural areas, especially in the mostly arid eastern and northern parts of the country. Health care is inadequate. The illiteracy rate is well above 50 per cent. The current United Nations Human Development Index (HDI) ranks the Republic of Senegal 164th out of 189 countries. It is one of the world's least developed countries (LDCs).

Gender equality has been enshrined in Senegal's constitution. Particularly in rural areas, however, the situation of women is still characterised by traditional ideas about their role. In some ethnic groups, female genital mutilation remains widespread. In parliamentary elections, a gender equality law governs the process. As a result, 69 of today's 165 members of parliament are women. meaning that Senegal ranks among the world's leading countries in terms of representation of women in parliament.


Economy

Fishermen and their boats at the beach of Dakar, Senegal

Senegal's economy is heavily dependent on imports, and is hampered by a small domestic market and a narrow range of exportable goods. Most people work in agriculture and fishing. However, agricultural productivity is low. The farming sector only accounts for about 15 per cent of gross domestic product. This is mainly due to the poor quality of the soil, irregular rainfall, overgrazing and deforestation. The coastal waters are not being managed responsibly. As a result, they are being overfished.

In 2017, Senegal's economy grew by a respectable 6.8 per cent. However, economic development has been very volatile in the past few years. Given the high population growth rate (2.8 per cent in 2017), sustained economic growth of six to seven per cent would be needed in order to reduce poverty effectively.

Many barriers have still to be overcome if private investment is to be encouraged. One major problem is energy scarcity, for example. Several power stations are being built which should go on stream in the next few years, including a solar power plant near Dakar that has been funded through German development cooperation.

Other constraints to development include an antiquated transport infrastructure, a tax system that is not conducive to business, an outdated land tenure system and complex regulations imposed by the authorities.


Rural exodus and migration

In a German development cooperation project in Kayar, Senegal, solar technology is used to operate water pumps.

As many people are no longer able to live off the land, they are migrating into towns and cities. This is causing major problems, especially in terms of drinking water supply, sanitation and solid waste management. Social conflicts, too, are worsening as urban labour markets are unable to absorb the incoming population. The official unemployment rate is 9.5 per cent, but according to estimates some 40 per cent of the workforce are jobless or underemployed.

More than 100,000 people leave Senegal every year. The remittances from Senegalese migrants now exceed two billion US dollars a year. They are thus a significant economic factor.

Since 2017, Senegal has been a target country for the BMZ programme on migration and development. Advice is being provided on matters such as cooperation with the Senegalese diaspora, migration issues, and business start-up programmes. Senegal is also a partner country for the BMZ's 'Returning to New Opportunities' returnee programme. In January 2018, a migration advice centre was opened in Dakar. Together with local projects under German development cooperation, the centre is intended to help returnees acquire vocational training and find jobs.


Conflict in Casamance

A warning sign for landmines at the border between Senegal and Guinea-Bissau

The southern part of Senegal – the Casamance region – is largely cut off from the rest of the country's national territory geographically, as well as being different from the north in terms of history, culture, economy, ethnicity and religion. Over three decades, the region experienced repeated armed conflict as rebel groups struggled for greater regional autonomy there.

Since the handover of power in 2012, the situation in the region has calmed down almost completely. Most of the landmines that had been planted during the conflict have been removed. Some violent incidents have been reported recently, but most of them have been connected to illegal trade in timber.

Casamance has significant natural resources and therefore the greatest potential for economic development in the country. However, this potential can only be tapped if a lasting solution to the conflict can be found.


Development potential

Senegal offers investors stable political conditions. The government is considered to be pro-reform and pro-development, and Senegal has a market-friendly economic system. The country's growth industries include construction, telecommunications, forestry, tourism, and fruit and vegetable growing for export.

The airport 50 kilometres east of Dakar, which began operating in December 2017, offers great economic potential. It could help make Senegal a hub for West Africa and beyond.

The country's most important growth industry is the service sector. It now accounts for almost 60 per cent of gross domestic product.


Priority areas of German cooperation with Senegal

Federal Minister Gerd Müller and President Macky Sall of Senegal at the G7 Summit in Elmau in 2015

Germany and Senegal have engaged in development cooperation for many decades. The most recent three-year commitment was made in 2015, for 53.66 million euros. In addition, the German Development Ministry approved funding totalling 29.6 million euros in 2016 and 2017.

The focus of development cooperation is on renewable energies and energy efficiency. Measures in the previous priority areas of sustainable economic development and decentralisation were completed in 2015, and responsibility for them was handed over to Senegal.

Germany is also providing support to Senegal through the African Risk Capacity Insurance Company (ARC). The scheme, which the BMZ is co-financing to the tune of 50 million euros, offers African countries climate risk insurance. In 2015, Senegal was the first country to receive a payout from this insurance, amounting to 16.5 million US dollars.


Renewable energy and energy efficiency

In Senegal, Germany is promoting the construction of decentralised solar systems in rural areas.

As part of Financial cooperation, Germany supports the construction of a photovoltaic power plant south of Dakar and the development of several decentralised rural microgrids based on smaller photovoltaic or hybrid installations. Assistance is being provided to an effort covering nine cities to modernise power distribution networks and set up electricity meters to enable people to use power on the basis of a prepaid arrangement.

In order to improve the power supply in rural regions, Germany supports a public-private partnership (PPP), under which KfW Development Bank is assisting with efforts under a concession provided by the government's agency for rural electrification. The concession has been granted for the construction and operation of power supply systems. A private company will connect 27,000 households and companies to the power network.

GIZ is providing advice to its partners in the Senegalese government on how to support training programmes in the field of renewable energy and energy efficiency and how to foster solar-based solutions, especially for micro, small and medium-sized enterprises.

Another programme under Technical Cooperation seeks to seize the new opportunities arising from the flexible, decentralised availability of power from renewable sources. It supports the development of new types of occupation and new income and job opportunities that are accessible and attractive, in particular, for young adults from less developed regions.


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