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Economy of Senegal

The former capital of French West Africa, Senegal is a semi-arid country located on the westernmost point of Africa. Predominantly rural and with limited natural resources, the country earns foreign exchange from fish, phosphates, peanuts, tourism, and services. Its economy is highly vulnerable to variations in rainfall and changes in world commodity prices. Senegal depends heavily on foreign assistance, which in 2007 represented about 23% of overall government spending--including both current expenditures and capital investments--or African Financial Community franc (CFA) 315 billion (U.S. $630 million).

The fishing sector is Senegal's export leader. In 2007, fishery products contributed 22% of Senegal’s export earnings and employed about 15% of the population. Industrial fishing operations struggle with high costs, more efficient Asian and European Union (EU) competitors, and ineffective patrolling of the country's territorial waters against poachers. Receipts from tourism, the second major foreign exchange earner, contribute between 4.6%-6.8% of GDP annually. Senegal has about 320 tourist-class hotels, and the sector employs about 100,000 people serving over 700,000 tourists annually. Agriculture employs 77% of the economically active populace, while groundnut cultivation (which in 1960 had provided 80% of Senegal’s export earnings) engages about 10% of the population and is done on 50% of sown land in rotation with millet and sorghum. Mining, especially of phosphates, employs about 33,000 people and provides about 15% of export value.

Senegal’s Agency for the Promotion of Investment (APIX) plays an important role in the government’s foreign investment program. Its objective is to increase the investment rate from its current level of 20.6% to 30%. Currently, there are no restrictions on the transfer or repatriation of capital and income earned, or investment financed with convertible foreign exchange. Economic assistance comes largely from France, the International Monetary Fund (IMF), the World Bank, and the United States. The European Union, the African Development Bank, China, Canada, Spain, Japan, and Germany also fund significant aid programs.

Senegal has well-developed though costly port facilities, an international airport serving 28 international airlines that serves as a regional hub, and a reasonable telecommunications infrastructure, including a fiber optics backbone. Cellular phone penetration exceeds 50% of the population, and there are 1.818 million Internet users.

As of 2008, U.S. foreign direct investment stock in Senegal totaled $18 million. Total bilateral trade in 2009 was $183 million, with the United States exporting $176 million in goods and importing $7 million of goods.

Remittances in 2010 reached $1.4 billion and were worth 10% of Senegal’s GDP.

GDP (2009): $12.82 billion.
Real annual growth rate (2010): 4.2%.
Per capita GDP (2010): $1,900 (purchasing power parity).
Inflation rate (consumer prices, 2010): 1.2%.
Natural resources: Fish, peanuts, phosphate, iron ore, gold, titanium, oil and gas, cotton.
Agriculture represents 12.4% of GDP. Products--fish, peanuts, millet, sorghum, manioc, rice, cotton, vegetables, flowers, fruit, livestock, forestry.
Industry: 19.8% of GDP, of which manufacturing and construction compromise 16.3% and energy/mining represent 3.5%. Types--fish and agricultural product processing, light manufacturing, mining, and construction.
Services: 55.6% of GDP, of which transport, warehousing, and communications represent 13.4% of GDP and trade 16.6% of GDP.
Trade: Exports (2008)--$2.05 billion: fish products, peanuts, phosphates, cotton. Major markets (2009)--Mali 20.12%, India 9.84%, The Gambia 5.58%, France 5.02%, Italy 4.23%, U.S. 0.5%. Imports (2010)--$4.474 billion: food, consumer goods, petroleum, machinery, transport equipment, petroleum products, computer equipment. Major suppliers (2009)--France 19.58%, U.K. 9.64%, China 8.08%, Netherlands 5.64%, Thailand 4.75%, U.S. 3.97%.
Exchange rate: African Financial Community franc (CFA) is fixed to the euro. 656 CFA = 1 euro. 495.28 CFA = U.S. $1.
Economic aid: The United States provided about $85.1 million in assistance to Senegal in fiscal year 2009, including $2.1 million for peace and security, $2.4 million for governing justly and democratically, $49.2 million for investing in people, and $31.4 million for economic growth.

Geography of Senegal

Senegal is bounded by the Atlantic Ocean, Mauritania, Mali, Guinea, and Guinea-Bissau. The Gambia penetrates more than 320 kilometers (200 mi.) into Senegal. Well-defined dry and humid seasons result from northeast winter winds and southwest summer winds. Dakar's annual rainfall of about 61 centimeters (24 in.) occurs between June and October when maximum temperatures average 27oC (82oF); December to February minimum temperatures are about 17oC (63oF). Interior temperatures are higher than along the coast, and rainfall increases substantially farther south, exceeding 150 centimeters (60 in.) annually in some areas. Official Name: Republic of Senegal Area: 196,840 sq. km. (76,000 sq. mi.), about the size of South Dakota. Cities: Capital--Dakar. Other cities--Diourbel, Kolda, Kaolack, Louga, Saint-Louis, Thies, Tambacounda, Ziguinchor. Terrain: Flat or rising to foothills. Climate: Tropical/Sahelian--desert or grasslands in the north, heavier vegetation in the south and southeast.

Government of Senegal

GOVERNMENT AND POLITICAL CONDITIONS
Senegal is a secular republic with a strong presidency, bicameral legislature, reasonably independent judiciary, and multiple political parties. Senegal is one of the few African states that has never experienced a coup d’etat. As noted above, power was transferred peacefully, if not altogether democratically, from Senghor to Diouf in 1981, and once again, this time in fully democratic elections, from Diouf to Wade in March 2000.

The president is elected by universal adult suffrage to a 5-year term. Under the terms of the 2001 constitution, presidents are limited to two terms. The bicameral parliament has a National Assembly with 150 members who are elected separately from the president, and a Senate with 100 members of which 35 are elected and 65 are chosen by the president. The Cour de Cassation (Highest Appeals Court, equivalent to the U.S. Supreme Court) and the Constitutional Council, the justices of which are named by the president, are the nation's highest tribunals. Senegal is divided into 14 administrative regions, each headed by a governor appointed by and responsible to the president. The law on decentralization, which came into effect in January 1997, distributed significant central government authority to regional assemblies.

Senegal’s principal political party was for 40 years the Socialist Party (PS). Its domination of political life came to an end in March 2000, when Wade, the leader of the Senegalese Democratic Party (PDS) and leader of the opposition for more than 25 years, won the presidency. The Socialist Party dominated the National Assembly until April 2001, when in free and fair legislative elections President Wade’s coalition won a majority (89 of 120 seats).

On February 25, 2007 President Wade won 56% of the vote in a field of 15 candidates, with 73% of registered voters going to the polls. Twice-postponed parliamentary elections took place on June 3, 2007, but most of the major opposition parties boycotted them, allowing the ruling PDS and its allies to capture 131 of the 150 seats in the National Assembly. Wade won open, peaceful, and highly competitive elections in 2000 and 2007 due to a strong Senegalese national desire for change after nearly 40 years of Socialist Party governments. Having come under tough scrutiny and criticism for not realizing many of his campaign promises, he has undertaken major public works projects that benefited him politically. In the March 22, 2009 local elections held nationwide, the opposition made substantial gains, including the defeat of Wade’s own son, Karim, in Dakar.

President Wade has advanced a liberal agenda for Senegal, including privatizations and other market-opening measures. He has a strong interest in raising Senegal's regional and international profile. The country, nevertheless, has limited means with which to implement ambitious ideas. The liberalization of the economy is proceeding, but at a slow pace. Senegal continues to play a significant role in regional and international affairs, including its successful brokering with the African Union of the June 4, 2009 agreement among the three main parties to Mauritania’s crisis regarding a return to constitutional order in Nouakchott.

Principal Government Officials
President of the Republic--Abdoulaye Wade
President of the Senate--Pape Diop
President of the National Assembly--Mamadou Seck
Prime Minister--Souleymane Ndéné Ndiaye
Ambassador to the United States--Fatou Danielle Diagne
Ambassador to the United Nations--Paul Badji

Senegal maintains an embassy in the United States at 2112 Wyoming Avenue, NW, Washington, DC 20008 (tel. 202-234-0540), and a Mission to the United Nations at 392 Fifth Avenue, 9th floor, New York, NY 10018 (tel. 212-517-9030).

Type: Republic.
Independence: April 4, 1960.
Constitution: March 3, 1963.
Branches: Executive--President (chief of state, commander in chief of armed forces). Legislative--bicameral parliament with a 150 member National Assembly and a 100 member Senate. Judicial--Constitutional Council (appointed by the president from senior magistrates and eminent academics and attorneys), Court of Final Appeals, Council of State.
Administrative subdivisions: 14 regions, 34 departments, 320 rural councils.
Political parties: 73 political parties are registered, the most important of which are the Democratic Party of Senegal (PDS), Rewmi, Socialist Party (PS), the Alliance of Forces for Progress (AFP), "AND JEF/PADS", the Union for Democratic Renewal (URD), "JEF JEL", the National Democratic Rally (RND), the Independence and Labor Party (PIT), and the Alliance for the Republic-Yakaar.
Suffrage: Universal adult, over 18.
Central government budget (2009): Revenues--$2.89 billion; expenditures--$3.86 billion.
Defense (2007): $133 million.
National holiday: April 4, Independence Day.

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History of Senegal

Archaeological findings throughout the area indicate that Senegal was inhabited in prehistoric times. Islam established itself in the Senegal River valley in the 11th century; 95% of Senegalese today are Muslims. In the 13th and 14th centuries, the area came under the influence of the Mandingo empires to the east; the Jolof Empire of Senegal also was founded during this time. In January 1959, Senegal and the French Soudan merged to form the Mali Federation, which became fully independent on June 20, 1960, as a result of the independence and the transfer of power agreement signed with France on April 4, 1960. Due to internal political difficulties, the Federation broke up on August 20, 1960. Senegal and Soudan (renamed the Republic of Mali) proclaimed independence. Leopold Sedar Senghor, internationally known poet, politician, and statesman, was elected Senegal's first President in August 1960. After the breakup of the Mali Federation, President Senghor and Prime Minister Mamadou Dia governed together under a parliamentary system. In December 1962, their political rivalry led to an attempted coup by Prime Minister Dia. Although this was put down without bloodshed, Dia was arrested and imprisoned, and Senegal adopted a new constitution that consolidated the President’s power. In 1980, President Senghor decided to retire from politics, and he handed over power in 1981 to his handpicked successor, Abdou Diouf. Abdou Diouf was President from 1981-2000. He encouraged broader political participation, reduced government involvement in the economy, and widened Senegal's diplomatic engagements, particularly with other developing nations. Domestic politics on occasion spilled over into street violence, border tensions, and a violent separatist movement in the southern region of the Casamance. Nevertheless, Senegal's commitment to democracy and human rights strengthened. Diouf served four terms as President. In the presidential election of 2000, he was defeated, in a free and fair election, by opposition leader Abdoulaye Wade. Senegal experienced its second peaceful transition of power, and its first from one political party to another. Parliamentary and presidential elections were held in 2006 and 2007, respectively.

People of Senegal

About 58% of Senegal's population is rural (2010). In rural areas, density varies from about 77 per square kilometer (200 per sq. mi.) in the west-central region to 2 per square kilometer (5 per sq. mi.) in the arid eastern section. About 50,000 Europeans (mostly French) and Lebanese reside in Senegal, mainly in the cities. French is the official language but is used regularly only by the literate minority. All Senegalese speak an indigenous language, of which Wolof has the largest usage. Nationality: Noun and adjective --Senegalese (sing. and pl.). Population (2011 est.): 12,643,799. Annual population growth rate: 2.5%. Ethnic groups: Wolof 43%; Fulani (Peulh) and Toucouleur 23%; Serer 15%; Diola, Mandingo, and others 19%. Religions: Muslim 94%, Christian 5%, traditional 1%. Languages: French (official), Wolof, Pulaar, Serer, Diola, Mandingo, Soninke. Education: Attendance --primary 75.8%, middle school 26.5%, secondary 11% (estimated). Literacy --59.1%. Health: Infant mortality rate --56.4/1,000. Life expectancy --59.78 years. Work force (5.53 million): Agriculture --77.5% (subsistence or cash crops). Industry and services --22.5%.
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