Senegal - Country Commercial Guide
Market Challenges

Learn about barriers to market entry and local requirements, i.e., things to be aware of when entering the market for this country.

Last published date: 2020-10-08

The GOS continues to improve Senegal’s investment climate.  Since 2007, Senegal has dramatically reduced the average number of days it takes to start a business.  The GOS continues to expand its “single window” system offering one-stop government services for businesses, opening new service centers in various locations and projecting at least one service center in each of the country’s 45 regional departments by 2021.  Property owners can apply for construction permits online.   In 2019, the GOS made tax information and some payment options available online.  Senegal’s state information agency ADIE has an ambitious plan to increase access to Wi-Fi and digitize more government services onto a national hub.  Senegal’s ranking in the World Bank’s Doing Business index improved from 141 in 2018 to 123 in 2019, spurred by improvements in the ease of paying taxes and access to credit information.  The GOS made progress in operationalizing the new Commercial Court, prioritizing the resolution of business disputes.  Although companies continue to report problems with corruption and opacity, Senegal compares favorably with many countries in the region in corruption indicators.  The Millennium Challenge Corporation (MCC) compact, signed in December 2018 and currently in pre-implementation prior to entry-into-force in 2021, aims to decrease energy costs by modernizing the power sector, increasing access to electricity in rural Senegal, strengthening the electrical transmission network in Dakar, and improving governance of the power sector.

Despite these improvements, business climate challenges remain.  Because the informal sector dominates Senegal’s economy, legitimate companies bear a heavy tax burden, although Senegal is making progress in broadening the tax base.  Some U.S. companies complain about delays and uncertainty in the project development process.  High costs for real estate and energy undermine Senegal’s competitiveness.  Senegal’s bureaucracy remains slow and difficult to navigate for projects requiring government approval.  A slow legal system and challenges in resolving commercial disputes are impediments to investment despite the recent creation of a commercial court.  Senegal has a procurement regulatory agency (ARMP) and standardized procurement practices.  However, application of these rules has been inconsistent. 

According to the World Bank, per capita GDP is $1,521, and $3,394 when adjusted by purchasing power parity (PPP)As a result, U.S. companies interested in this market may want to consider a regional strategy using Dakar as a hub for West Africa.