I.  COMMERCIAL OVERVIEW


SENEGAL OFFERS A SMALL AND RELATIVELY LIMITED MARKET FOR U.S.
BUSINESS.  THE POPULATION IS ALMOST 8 MILLION PERSONS AND PER
CAPITA INCOME IS ABOUT USD 480.  PRINCIPAL U.S. EXPORTS ARE
AGRICULTURAL COMMODITIES, USED CLOTHES, AND A VERY LIMITED AMOUNT
OF MACHINERY AND EQUIPMENT.  THE UNITED STATES RUNS A SIGNIFICANT
SURPLUS IN BILATERAL TRADE, EXPORTING ABOUT USD 60M PER YEAR TO
SENEGAL.

THE FRENCH INFLUENCE IN SENEGAL IS STRONG.  FRENCH IS THE
NATIONAL LANGUAGE AND VERY LITTLE ENGLISH IS SPOKEN.  MOST
BUSINESSES HAVE LONG-ESTABLISHED TIES WITH FRENCH SUPPLIERS.  THE
SENEGALESE AUTHORITIES AND THE SENEGALESE PEOPLE ARE GENERALLY
WELL DISPOSED TOWARD AMERICANS; HOWEVER, ALTHOUGH AMERICAN GOODS
CAN COMPETE ON QUALITY, PRICE AND TECHNICAL MERIT, A PROSPECTIVE
U.S. EXPORTER MUST INVEST A GREAT AMOUNT OF TIME IN MARKETING THE
PRODUCT AND FINDING QUALIFIED LOCAL REPRESENTATIVES.  SUBMISSIONS
OF TENDERS MUST BE MADE ENTIRELY IN FRENCH.

THE ECONOMY IN THIS SEMI-ARID COUNTRY IS HEAVILY DEPENDENT UPON
THE AMOUNT OF ANNUAL RAINFALL, WHICH MAY VARY CONSIDERABLY FROM
YEAR TO YEAR.  ECONOMIC DEVELOPMENT HAS BEEN HINDERED BY THE
GOVERNMENT'S GENERALLY STATIST AND PROTECTIONIST POLICIES.  THE
GOVERNMENT HAS INSTITUTED REFORMS OVER THE PAST TEN YEARS BUT THE
RESULTS HAVE BEEN UNEVEN.

IN 1994 SENEGAL AND OTHER AFRICAN FRANC ZONE COUNTRIES DEVALUED
THEIR COMMON CURRENCY FOR THE FIRST TIME, SEEKING TO ESTABLISH
THE CONDITIONS TO MAKE THEIR ECONOMIES MORE COMPETITIVE IN
INTERNATIONAL MARKETS.  DOMESTIC DEMAND HAS FALLEN SHARPLY.
MONETARY POLICY REMAINS VERY TIGHT AND LITTLE FINANCING IS
AVAILABLE FOR BUSINESS.  GOVERNMENT ARREARS TO THE PRIVATE SECTOR
ARE EQUIVALENT TO MORE THAN 2 PCT OF GDP.  IN MID-1994 MOST PARTS
OF THE FORMAL SECTOR OF THE ECONOMY ARE STAGNANT OR CONTRACTING.
THE INFORMAL SECTOR MAKES UP ALMOST 60 PCT OF THE ECONOMY.

INTERNATIONAL FINANCIAL INSTITUTIONS AND BILATERAL DONORS ARE
SUPPORTING SENEGAL'S ECONOMIC ADJUSTMENT EFFORT.  SENEGAL IS
EXPECTED TO ACHIEVE MODEST REAL GROWTH IN 1994.  THE PROGRAM
AGREED WITH DONORS IS EXPECTED TO ACCELERATE THIS GROWTH SOMEWHAT
IN LATER YEARS.

CONSIDERABLE INVESTMENT IN INFRASTRUCTURE IS SCHEDULED OVER THE
MEDIUM TERM, PARTICULARLY IN WATER AND WASTE MANAGEMENT,
TELECOMMUNICATIONS, AND ELECTRIC GENERATION.  ENGINEERING AND
MANAGEMENT SERVICES MAY BE REQUIRED TO CARRY OUT PROGRAMS OF
INVESTMENT IN THESE SECTORS.