Earlier this week, 39 entrepreneurs and industrialists from the Sino-African Chamber of Commerce in Yiwu met with Senegal’s Agency for Investment Promotion and Major Works (APIX) in Dakar to explore new investment opportunities, with a focus on Senegal’s energy and power sectors.
With the first barrel of oil recently produced from the Sangomar Field Development – as well as first gas anticipated from the Greater Tortue Ahmeyim (GTA) project later this year – Senegal’s energy sector is booming. The country has also emerged as a renewable energy hub within the region through facilities like the Senergy 2 solar plant and Taiba N’Diaye wind farm. The IMF projects Senegal’s GDP to grow by 7.1% in 2024 and 10% in 2025, positioning the country as one of Africa’s most dynamic and fastest-growing economies, as well as a leading investment destination.
China – as one of Africa’s largest foreign investors – has shown growing interest in this potential. Since 2013, the investment volume between China and Senegal has reached $1 billion, making China the second-largest economic partner to Senegal, after France. While Chinese investment on the continent has traditionally focused on southern and East Africa, West African countries have grown to become the largest beneficiaries of Chinese loans in the post-pandemic period. Between 2021-2022, $1.92 billion – representing 86% of Chinese loans to Africa – was allocated to West African projects, with Senegal, Benin and Ivory Coast securing the largest share.
Most of these investments have been infrastructure-focused, falling under China’s flagship “Belt and Road Initiative” that aims to improve regional integration, expand trade routes and strengthen economic ties with the African continent. In Senegal, China has invested heavily in connectivity infrastructure, such as the Safar railway extension project in Touba carried out by China Railways Senegal, as well as the planned Dakar to Saint-Louis motorway, to be built by China International Water and Electric Corp.
China is also a major investor in Senegal’s digital and ICT sector, which has been positioned as a key sector and employment driver. In 2023, Chinese companies built Senegal’s government intranet, installed 4,500 km of fiber optic cable and constructed 3G and 4G networks. The government of China also funded the Diamniadio Digital Technology Park’s data center – one of West Africa’s largest public data storage centers – in collaboration with Chinese multinational Huawei. Currently, 217 Chinese companies are registered in Senegal, with 81 projects generating 9,938 jobs. With rising Chinese interest in Senegal’s fastest-growing sectors – as well as the country’s favorable operating environment and ease of doing businesses – these numbers are likely to rise.
During this week’s meeting with APIX, Zhu Shun, Director General of the Sino-African Chamber of Commerce in Yiwu, highlighted the Chamber’s focus on Senegal’s demand for low-voltage electrical products. As a global leader in renewable energy manufacturing, China boasts more than 80% of solar manufacturing capacity worldwide. As a result, Senegal’s goal to raise the share of renewable energy to 40% by 2030 presents a strategic opportunity for Chinese businesses to participate in solar home systems, battery components, clean energy technologies and associated infrastructure. In Senegal, 65% of the population has access to electricity and 50% of power is generated from fuel-powered plants, set to be converted to gas-to-power plants. This transition offers additional opportunities for Chinese power sector investors, particularly in technology transfer.
Similarly, the development of Senegal’s oil and gas sector requires substantial investment in supporting infrastructure, including roads and ports, to facilitate the export of gas and oil products. Upgrading the road between Dakar and the Saint-Louis region, home to the GTA project, could halve the current travel time of 5.5 hours. Additionally, the expansion of the domestic railway network by state-owned Grands Trains du Sénégal, along with the construction of the new port of Ndayane, will alleviate congestion on main roads, redirect goods transportation to new economic hubs, and stimulate broader growth.
The upcoming MSGBC Oil, Gas & Power 2024 conference and exhibition – taking place this December in Dakar – will highlight prime investment opportunities shaping Senegal’s energy sector. The event aims to unite global investors with local projects across the value chain, from oil and gas exploration to clean energy development.
Explore opportunities, foster partnerships and stay at the forefront of the MSGBC region’s oil, gas and power sector. Visitwww.msgbcoilgasandpower.com to secure your participation at the MSGBC Oil, Gas & Power 2024 conference. To sponsor or participate as a delegate, please contact sales@energycapitalpower.com.
