Dakar Municipal Finance Program

The City of Dakar, Senegal, contracted DIG to help leverage American and Senegalese capital and de-risking instruments to generate own-source revenues for urban revitalization projects. DIG advised the City on the issuance of municipal bonds to fund pro-poor infrastructure, and helped the city secure a planning grant from the Gates Foundation. Subsequently, DIG and the City wrote a successful USD 4.9 million proposal to secure the resources needed to prepare for launching the city’s first municipal bond. With this funding, DIG helped establish and provide technical assistance to the Dakar Municipal Finance Program (DMFP) team, assisting it along the many steps required to go to capital markets, including: assessing the city’s debt capacity, identifying municipal finance risks and mitigation strategies, obtaining a guarantee from USAID’s Development Credit Authority, and increasing the city’s creditworthiness by improving its fiscal management and modernizing its tax collection system to increase collection rates. In the process, DIG helped formalize the DMFP, making it a permanent unit within the Mayor’s Office. The city received an investment grade credit rating from Bloomfield Investment, an internationally recognized rating agency. As a result of this initiative, and with support from DIG, the city has acquired the skills and experience needed to borrow on capital markets. DIG continues to work with the DMFP to identify and assess other potential municipal investments that will generate revenues and commercial rates of returns. (2013-2016)