The Financial Times reports that Senegal has quietly borrowed roughly €650 million through total return swap agreements with the Africa Finance Corporation (AFC) and First Abu Dhabi Bank (FAB), with Bank of America estimating that total swap-based borrowing in 2025 may reach up to $1 billion.
Documentation reviewed by the FT hints at a further undisclosed deal with Société Générale.
FTが確認した文書は、ソシエテ・ジェネラルとのさらなる未公開の取引を示唆しています。
For a government that came to power condemning $7 billion in hidden liabilities inherited from its predecessor, this is an uncomfortable echo of the past — the same pattern, now dressed in derivative language rather than off-budget loans.
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What the FT found
In the AFC deal, Senegal issued €150 million in domestic CFA franc bonds and transferred legal title to AFC, receiving €105 million in euro cash — a roughly 30 per cent haircut absorbed upfront.
The FAB deal follows the same template: approximately €400 million in bonds pledged, €300 million in euro cash received. Both transactions mature in 2028. Senegal pays a floating interest rate plus a fixed margin — reportedly 3.5 to 4 percentage points above the floating rate on the AFC leg and approximately 5 percentage points on the FAB leg.
The IMF has confirmed it is aware of the swaps but notes that their terms have not been shared, even though such disclosure is normally required for debt sustainability analysis. Private bondholders report learning about the transactions only through informal ministry meetings, with no public communication from Dakar.
The embedded CDS: Senegal sold protection on its own debt
A credit default swap (CDS) is a derivative in which one party pays a regular fee to another in exchange for protection against the risk that a borrower will default or its credit will deteriorate; the protection seller effectively insures the credit of the underlying borrower.
In return, the protection seller must compensate the buyer if the reference borrower’s bonds fall sharply in value due to a default or serious credit event.
The legal label — “total return swap” — can obscure an economic reality that is considerably more troubling for the sovereign counterparty. Under the reported structure, AFC and FAB hold legal title to the pledged bonds and receive their economic return — coupon payments, any price appreciation, and contractual protection against losses if the bonds fall in value.
Senegal, in exchange, receives upfront euros and assumes exposure to covering some or all of the lenders’ downside if those bonds lose value, under conditions specified in the swap contracts. This is economically similar to writing credit default swaps on Senegal’s own sovereign bonds — with Senegal effectively selling protection on its own credit.
Put more simply, Senegal has sold the “volatility” on these bonds: it does not share in the upside when prices rise, but it absorbs the losses when prices fall. If Senegal’s credit deteriorates, it can be hit twice — with wider spreads across its entire debt stock and with additional cash payments under the swaps to compensate the lenders for losses on the pledged bonds.
According to AFC documentation on similar structures, the lender may have the right, in a default event, to mark the pledged collateral down sharply and call for immediate cash compensation from the sovereign; such margin calls would add acute liquidity pressure to an already stressed fiscal position, although the precise margining terms in Senegal’s contracts have not been publicly disclosed.
In economic terms, Senegal is borrowing euros from the same banks that are its swap counterparties, pledging its own domestic bonds as collateral. The banks provide the euro funding, receive the full economic return on the pledged bonds — coupons and price movements — and charge a separate floating euro rate plus a fixed spread on the notional, leaving Senegal with both the funding cost and the risk that adverse moves in its own credit will crystallise into cash outflows.
Step 1 — Senegal pledges bonds with a higher face value than the cash it receives.
ステップ1 — セネガルは受け取る現金よりも高い額面価値の債券を担保として提供します。
For the FAB leg, it pledges about €400 million in domestic bonds and receives roughly €300 million in euros. The roughly €100 million gap functions as a built-in cushion for the lender against losses on the collateral. Senegal effectively absorbs the first layer of loss on the pledged bonds before the lender is materially exposed.
The all-in cost has been reported as a floating euro benchmark rate plus approximately 4 to 5 percentage points. That benchmark moves with monetary conditions set in Frankfurt, not Dakar, and is the main parameter that could move in Senegal’s favour over time.
The spread, which reflects much of the lenders’ profit margin, is locked in for the life of the deal, regardless of whether Senegal’s fiscal position improves.
If Senegal’s bonds fall in value — because its fiscal position worsens or markets lose confidence in Senegal’s credit — Senegal may be required under the swaps to make additional cash payments to the lenders to cover those losses.
If Senegal’s bonds rise in value — because its credit improves or euro rates fall — the lenders can capture that upside by selling the bonds in the secondary market, since they hold legal title, or by receiving the appreciated market value at termination.
Senegal does not share directly in that price appreciation; it is largely left with the funding cost and the risk that adverse moves in its own credit turn into sizeable cash outflows.
In economic terms, Senegal has largely surrendered the upside on the pledged bonds while retaining substantial downside exposure. The one scenario that would normally reward a sovereign for good fiscal management — improving creditworthiness and rising bond prices — delivers little direct benefit to Senegal on these particular bonds under this structure. Much of the effective option value on these bonds appears to have been transferred to the lenders at inception.
Warren Buffett famously described derivatives as “weapons of mass destruction.” The warning is particularly relevant when sovereigns under stress use complex instruments to solve immediate funding problems.
African finance ministers facing market-access constraints should treat any proposal involving total return swaps, synthetic structures, or collateralised derivative overlays with extreme caution.
The complexity is not incidental; it is what makes these instruments attractive to lenders and dangerous to borrowers who do not fully command the underlying risk mechanics. If the terms cannot be explained plainly to a parliamentary finance committee, a debt management office, and the IMF, they should not be signed.
Transparency, hard choices, and the capacity to govern
The most dangerous aspect of Senegal’s swaps is not their price but their opacity. When the IMF cannot complete a debt sustainability analysis because key contract terms are withheld, and when bondholders must extract information through private lobbying rather than public disclosure, market discipline breaks down. Creditors add an uncertainty premium; over time, the sovereign pays more, not less.
The better course begins with coming clean. That means full transparency on all such structures, identifying the size and terms of each exposure, and assessing whether any of the associated risks can be sensibly hedged. These swaps, and indeed the entire debt stock, should be managed within a coherent, medium-term strategy that combines debt restructuring where needed, credible fiscal consolidation, selective asset sales, and, where possible, negotiated debt write-offs to restore a sustainable position.
Delivering that strategy requires investing in public financial management reforms — from stronger debt-management offices and tighter fiscal anchors to empowered oversight and audit institutions — so that transparency is matched by the institutional capacity to act on what it reveals.
Senegal’s new government inherited a hidden-debt scandal and, by the logic of these transactions, risks constructing a new one. The instruments are different; the pattern is the same. A sovereign that sells volatility on its own bonds while hoping for a benign future is not managing risk — it is deferring a reckoning.
For African policymakers, the lesson is not that markets are closed, nor that derivatives are always toxic. It is that hard currency obtained by selling opaque, one-sided options on your own credit could be the most expensive funding of all. Transparency, hard choices, and the slow work of building fiscal governance capacity are not substitutes for market access; they are the only durable route to it.
セネガルの隠されたデリバティブ：隠れた債務2.0
The Financial Times reports that Senegal has quietly borrowed roughly €650 million through total return swap agreements with the Africa Finance Corporation (AFC) and First Abu Dhabi Bank (FAB), with Bank of America estimating that total swap-based borrowing in 2025 may reach up to $1 billion.
ドイツ銀行が推定するところによれば、2025年におけるスワップベースの借入は最大で10億ドルに達する可能性があります。
Documentation reviewed by the FT hints at a further undisclosed deal with Société Générale.
FTが確認した文書は、ソシエテ・ジェネラルとのさらなる未公開の取引を示唆しています。
For a government that came to power condemning $7 billion in hidden liabilities inherited from its predecessor, this is an uncomfortable echo of the past — the same pattern, now dressed in derivative language rather than off-budget loans.
前政権から引き継いだ70億ドルの隠れ負債を非難して政権を握った政府にとって、これは過去の不快な反響です。オフバランスシートの貸付ではなく、今やデリバティブの言葉で着飾られた同じパターンです。
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What the FT found
In the AFC deal, Senegal issued €150 million in domestic CFA franc bonds and transferred legal title to AFC, receiving €105 million in euro cash — a roughly 30 per cent haircut absorbed upfront.
AFCとの取引では、セネガルは1億5千万ユーロの国内CFAフラン債を発行し、AFCに法的権利を移転し、1億500万ユーロの現金を受け取りました。これは、約30パーセントのカットを前払いで吸収したことになります。
The FAB deal follows the same template: approximately €400 million in bonds pledged, €300 million in euro cash received. Both transactions mature in 2028. Senegal pays a floating interest rate plus a fixed margin — reportedly 3.5 to 4 percentage points above the floating rate on the AFC leg and approximately 5 percentage points on the FAB leg.
FABとの取引は同様のテンプレートに従っています：およそ4億ユーロの債券が担保として提供され、3億ユーロの現金を受け取ります。両取引は2028年に満期を迎えます。セネガルは、浮動金利に加えて固定マージンを支払います—AFC側で浮動金利の3.5から4パーセントポイント、FAB側では約5パーセントポイントと報告されています。
The IMF has confirmed it is aware of the swaps but notes that their terms have not been shared, even though such disclosure is normally required for debt sustainability analysis. Private bondholders report learning about the transactions only through informal ministry meetings, with no public communication from Dakar.
IMFはスワップを認識していることを確認しましたが、その条件は共有されていないと指摘しています。これは通常、債務持続可能性分析のために必要とされる開示です。民間債権者は、ダカールからの公のコミュニケーションがない中で、非公式な省の会議を通じてのみ取引について知ったと報告しています。
The embedded CDS: Senegal sold protection on its own debt
A credit default swap (CDS) is a derivative in which one party pays a regular fee to another in exchange for protection against the risk that a borrower will default or its credit will deteriorate; the protection seller effectively insures the credit of the underlying borrower.
クレジットデフォルトスワップ（CDS）は、ある当事者が別の当事者に定期的な手数料を支払い、借り手がデフォルトするリスクやその信用が悪化するリスクに対する保護を得るためのデリバティブです。保護提供者は、基礎となる借り手の信用を実質的に保険します。
In return, the protection seller must compensate the buyer if the reference borrower’s bonds fall sharply in value due to a default or serious credit event.
その見返りとして、保護提供者は、参照借り手の債券がデフォルトや重大な信用事象によって急激に価値が下落した場合、買い手に補償しなければなりません。
The legal label — “total return swap” — can obscure an economic reality that is considerably more troubling for the sovereign counterparty. Under the reported structure, AFC and FAB hold legal title to the pledged bonds and receive their economic return — coupon payments, any price appreciation, and contractual protection against losses if the bonds fall in value.
法的なラベル—「トータルリターンスワップ」—は、主権対称者にとってさらに問題のある経済的現実を曖昧にする可能性があります。報告された構造の下で、AFCとFABは担保にされた債券の法的権利を保持し、経済的リターン—クーポン支払い、価格上昇、債券が価値を失った場合の損失に対する契約上の保護—を受け取ります。
Senegal, in exchange, receives upfront euros and assumes exposure to covering some or all of the lenders’ downside if those bonds lose value, under conditions specified in the swap contracts. This is economically similar to writing credit default swaps on Senegal’s own sovereign bonds — with Senegal effectively selling protection on its own credit.
セネガルはその見返りとして、前払いのユーロを受け取り、スワップ契約に指定された条件の下で、これらの債券が価値を失った場合に貸し手の損失の一部またはすべてをカバーするリスクを負います。これは、セネガル自身の主権債に対するクレジットデフォルトスワップを執筆することと経済的に類似しています—セネガルは実質的に自己の信用に対する保護を売っているのです。
Put more simply, Senegal has sold the “volatility” on these bonds: it does not share in the upside when prices rise, but it absorbs the losses when prices fall. If Senegal’s credit deteriorates, it can be hit twice — with wider spreads across its entire debt stock and with additional cash payments under the swaps to compensate the lenders for losses on the pledged bonds.
簡単に言えば、セネガルはこれらの債券の「ボラティリティ」を売りました：価格が上昇するときには利益を共有せず、価格が下落するときには損失を吸収します。セネガルの信用が悪化すれば、一度に二重に打撃を受ける可能性があります—全債務ストックにわたってスプレッドが広がり、担保債券の損失を補償するためにスワップの下で追加の現金支払いが必要になるのです。
According to AFC documentation on similar structures, the lender may have the right, in a default event, to mark the pledged collateral down sharply and call for immediate cash compensation from the sovereign; such margin calls would add acute liquidity pressure to an already stressed fiscal position, although the precise margining terms in Senegal’s contracts have not been publicly disclosed.
同様の構造に関するAFCの文書によれば、貸し手はデフォルトが発生した場合、担保を急激に減額し、主権から即時の現金補償を求める権利を持つ可能性があります。そのようなマージンコールは、すでにストレスのかかった財政状況に急激な流動性圧力を追加しますが、セネガルの契約における正確なマージン条件は公に開示されていません。
In economic terms, Senegal is borrowing euros from the same banks that are its swap counterparties, pledging its own domestic bonds as collateral. The banks provide the euro funding, receive the full economic return on the pledged bonds — coupons and price movements — and charge a separate floating euro rate plus a fixed spread on the notional, leaving Senegal with both the funding cost and the risk that adverse moves in its own credit will crystallise into cash outflows.
経済的には、セネガルはそのスワップの相手方である同じ銀行からユーロを借りており、自国の債券を担保として提供しています。銀行はユーロ資金を提供し、担保債券に対する完全な経済的リターン—クーポンと価格変動—を受け取り、名目に対して別の浮動ユーロ金利と固定スプレッドを請求し、セネガルには資金コストと自身の信用の悪化が現金流出に繋がるリスクの両方が残ります。
A one-way street: who wins and who loses
The basic cash-flow logic is straightforward, and the asymmetry of risks is stark. It can be understood in three simplified steps.
基本的なキャッシュフローの論理は明快であり、リスクの非対称性は明らかです。これは三つの簡略化されたステップで理解できます。
Step 1 — Senegal pledges bonds with a higher face value than the cash it receives.
ステップ1 — セネガルは受け取る現金よりも高い額面価値の債券を担保として提供します。
For the FAB leg, it pledges about €400 million in domestic bonds and receives roughly €300 million in euros. The roughly €100 million gap functions as a built-in cushion for the lender against losses on the collateral. Senegal effectively absorbs the first layer of loss on the pledged bonds before the lender is materially exposed.
FAB側では、約4億ユーロの国内債券を担保として提供し、約3億ユーロを受け取ります。約1億ユーロのギャップは、担保の損失に対する貸し手のための内蔵クッションとして機能します。セネガルは実質的に、貸し手が実質的にリスクにさらされる前に、担保債券に対する最初の損失層を吸収します。
Step 2 — Every period until 2028, Senegal pays a floating interest rate plus a fixed premium.
ステップ2 — 2028年までの各期間において、セネガルは浮動金利に加えて固定プレミアムを支払います。
The all-in cost has been reported as a floating euro benchmark rate plus approximately 4 to 5 percentage points. That benchmark moves with monetary conditions set in Frankfurt, not Dakar, and is the main parameter that could move in Senegal’s favour over time.
全体的なコストは、浮動ユーロベンチマーク金利に約4から5パーセントポイントを加えたものとして報告されています。そのベンチマークは、ダカールではなくフランクフルトで設定された金融状況に応じて変動し、時間の経過とともにセネガルに有利に働く可能性がある主要なパラメーターです。
The spread, which reflects much of the lenders’ profit margin, is locked in for the life of the deal, regardless of whether Senegal’s fiscal position improves.
スプレッドは、貸し手の利益マージンの多くを反映しており、セネガルの財政状況が改善されても、この取引の期間中は固定されています。
Step 3 — At maturity, whether Senegal’s credit improves or deteriorates, the outcome is heavily one-sided
ステップ3 — 満期時に、セネガルの信用が改善されるか悪化するかにかかわらず、結果は非常に一方的です。
If Senegal’s bonds fall in value — because its fiscal position worsens or markets lose confidence in Senegal’s credit — Senegal may be required under the swaps to make additional cash payments to the lenders to cover those losses.
セネガルの債券が価値を失う場合—財政状況が悪化するか、市場がセネガルの信用に自信を失うため—セネガルはスワップの下で、貸し手に追加の現金支払いを行い、その損失をカバーする必要があるかもしれません。
If Senegal’s bonds rise in value — because its credit improves or euro rates fall — the lenders can capture that upside by selling the bonds in the secondary market, since they hold legal title, or by receiving the appreciated market value at termination.
セネガルの債券が価値を上昇させる場合—信用が改善されるか、ユーロ金利が下落するため—貸し手は、法的権利を持っているため、債券を二次市場で売却することによってその利益を得るか、契約終了時に上昇した市場価値を受け取ることができます。
Senegal does not share directly in that price appreciation; it is largely left with the funding cost and the risk that adverse moves in its own credit turn into sizeable cash outflows.
セネガルはその価格上昇を直接共有することはありません。主に資金コストと、自身の信用の悪化が大規模な現金流出に変わるリスクが残ります。
In economic terms, Senegal has largely surrendered the upside on the pledged bonds while retaining substantial downside exposure. The one scenario that would normally reward a sovereign for good fiscal management — improving creditworthiness and rising bond prices — delivers little direct benefit to Senegal on these particular bonds under this structure. Much of the effective option value on these bonds appears to have been transferred to the lenders at inception.
経済的には、セネガルは担保債券の上昇分をほとんど放棄し、 substantialな下方リスクを保持しています。通常、良好な財政管理に対して主権国に報いるシナリオ—信用力の向上と債券価格の上昇—は、この構造の下ではこれらの特定の債券に対してセネガルにほとんど直接的な利益をもたらしません。これらの債券に関する多くの実効オプション価値は、創設時に貸し手に移転されたようです。
A warning to African finance ministers
Warren Buffett famously described derivatives as “weapons of mass destruction.” The warning is particularly relevant when sovereigns under stress use complex instruments to solve immediate funding problems.
ウォーレン・バフェットは、デリバティブを「大量破壊兵器」と表現しました。この警告は、ストレス下にある主権国が複雑な金融商品を使用して即時の資金問題を解決する場合に特に関連性があります。
Derivative structures like these swaps do not spread risk; they concentrate it, obscure it, and defer its recognition until it becomes unmanageable.
このようなスワップのようなデリバティブ構造はリスクを分散させるのではなく、それを集約し、曖昧にし、管理不能になるまでその認識を延期します。
African finance ministers facing market-access constraints should treat any proposal involving total return swaps, synthetic structures, or collateralised derivative overlays with extreme caution.
市場アクセスの制約に直面しているアフリカの財務大臣は、トータルリターンスワップ、合成構造、または担保付きデリバティブオーバーレイを含む提案には極めて慎重に対処すべきです。
The complexity is not incidental; it is what makes these instruments attractive to lenders and dangerous to borrowers who do not fully command the underlying risk mechanics. If the terms cannot be explained plainly to a parliamentary finance committee, a debt management office, and the IMF, they should not be signed.
その複雑さは偶然ではなく、これらの金融商品を貸し手にとって魅力的にし、基礎となるリスクメカニズムを完全に把握していない借り手にとって危険にしています。契約条件が国会の財務委員会、債務管理事務所、IMFに対して明確に説明できないのであれば、それらは署名されるべきではありません。
Transparency, hard choices, and the capacity to govern
The most dangerous aspect of Senegal’s swaps is not their price but their opacity. When the IMF cannot complete a debt sustainability analysis because key contract terms are withheld, and when bondholders must extract information through private lobbying rather than public disclosure, market discipline breaks down. Creditors add an uncertainty premium; over time, the sovereign pays more, not less.
セネガルのスワップの最も危険な側面は、その価格ではなく、不透明性です。IMFが重要な契約条件が隠されているために債務持続可能性分析を完了できない場合、そして債権者が公の開示ではなく私的なロビー活動を通じて情報を引き出さなければならない場合、市場の規律は崩壊します。債権者は不確実性プレミアムを追加します。時間が経つにつれて、主権国は少なくとも多くを支払うことになります。
The better course begins with coming clean. That means full transparency on all such structures, identifying the size and terms of each exposure, and assessing whether any of the associated risks can be sensibly hedged. These swaps, and indeed the entire debt stock, should be managed within a coherent, medium-term strategy that combines debt restructuring where needed, credible fiscal consolidation, selective asset sales, and, where possible, negotiated debt write-offs to restore a sustainable position.
より良いコースは、透明性を持つことから始まります。これは、すべてのそのような構造に関する完全な透明性を持ち、各エクスポージャーのサイズと条件を特定し、関連するリスクのいずれかを合理的にヘッジできるかどうかを評価することを意味します。これらのスワップ、そして実際には全債務ストックは、必要に応じて債務再構築を組み合わせ、信頼できる財政統合、選択的な資産売却、可能な限り交渉された債務免除を通じて持続可能な位置を回復させる一貫した中期戦略の下で管理されるべきです。
Delivering that strategy requires investing in public financial management reforms — from stronger debt-management offices and tighter fiscal anchors to empowered oversight and audit institutions — so that transparency is matched by the institutional capacity to act on what it reveals.
その戦略を実行するには、強力な債務管理事務所や厳格な財政的アンカーから、権限を持った監視および監査機関に至るまで、公共財政管理改革に投資する必要があります。透明性が、それが明らかにする内容に基づいて行動するための組織の能力と一致するようにするためです。
Avoiding hidden debt 2.0
Senegal’s new government inherited a hidden-debt scandal and, by the logic of these transactions, risks constructing a new one. The instruments are different; the pattern is the same. A sovereign that sells volatility on its own bonds while hoping for a benign future is not managing risk — it is deferring a reckoning.
セネガルの新政府は隠れ債務スキャンダルを引き継ぎ、これらの取引の論理によって新たなスキャンダルを構築するリスクがあります。金融商品は異なりますが、パターンは同じです。自国の債券のボラティリティを売り、好意的な未来を期待する主権国はリスクを管理しているのではなく、決算を延期しています。
For African policymakers, the lesson is not that markets are closed, nor that derivatives are always toxic. It is that hard currency obtained by selling opaque, one-sided options on your own credit could be the most expensive funding of all. Transparency, hard choices, and the slow work of building fiscal governance capacity are not substitutes for market access; they are the only durable route to it.
アフリカの政策立案者にとっての教訓は、市場が閉じているわけでも、デリバティブが常に有毒であるわけでもありません。自分自身の信用の不透明で片側的なオプションを売ることによって得られたハードカレンシーが、最も高価な資金調達となる可能性があるということです。透明性、厳しい選択、および財政ガバナンス能力の構築に向けた緩やかな努力は市場アクセスの代替品ではなく、それが持続可能な唯一の道です。