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Foreign exchange: an economic opportunity goes bust

ECHANGES – Un d?bouch? ?conomique en panne, Mohamed Gueye, Le Quotidien, July 6, 2009.

The demolition of the Kayes bridge hurts Senegalese businesses

For almost two months, traffic between Senegal and Mali has been disrupted by the demolition of the bridge that crosses the Senegal River at Kayes. Strangely, even though this situation is hurting Senegalese businesses that trade with Mali, the political leaders in Senegal seem indifferent, as though walled in by a silence of marble.

The Kayes bridge in Mali has been cut off for almost two months, and the situation will not change much in the next three months. Meanwhile in Senegal, traders who work with their neighbor to the east are beyond worried; some are feeling despondent. One, who does a lot of business in the country of Amadou Toumani Tour?, says, “In Senegal, no matter what level of government, we don’t hear anyone concerned about this situation which is hurting many sectors of the economy. For quite a while, the flow of goods to Mali has slowed to a trickle, as has the flow from Senegal to Mali. A request for information from the Port of Dakar, which maintains warehouses in the Malian capital of Bamako, has gone unanswered.

We had to go to Malian officials to get to the bottom of the story. That’s where we received confirmation that the Kayes bridge over the Senegal River has been demolished by the government of Mali, in keeping with their policy of maintaining solid infrastructure in the country. The old bridge had become dilapidated, and the government had decided to replace it with a more solid one. In the meantime, only the railroad bridge remains in place to transport goods and passengers on the train. But the performance of these shuttles, particularly concerning passengers and small goods, has been so unreliable since the railroad was privatized in the early 2000s that many people, particularly traders, have never wanted to be dependent on them. On top of that, the Transrail corporation, which operates the Dakar and Niger Railroad, is regularly hit by strikes, which only adds to its paralysis.

Our main customer in the UEMOA

This situation has left companies who trade with Mali in a weak position, and they receive no comfort from the authorities. Most of the truckers, Malians in particular, have suspended their activities to avoid having to transload their cargo to other carriers. Passengers who insist on traveling this route are forced to disembark near the bridge, cross by boat, and board another vehicle on the other side of the river. If that sounds like a hassle for the passengers, it is impossible for businesses transporting goods. Some have simply decided to put the brake on their activities until the situation becomes clearer. Many of them have observed that Mali is a natural market for Senegalese goods. In addition, the economic balance between Senegal and Mali favors our country so much that the government should have made the reestablishment of truck routes between the two countries a top priority.

To support these claims, the Foreign Trade Analysis Report (NACE) published by the National Agency for Statistics and Demographics (ANSD) stresses that Mali is the primary export goal for Senegal in the subregion. It takes in 53.7% of Senegalese products sold in the subregion, and 75% of Senegalese exports in the West African Economic and Monetary Union (UEMOA). The goods are mostly petroleum products and cement, which earned the country 213.2 billion Central African francs [$460 million] in 2008, but Mali also buys fish and industrial products from Senegal. Senegalese imports from Mali, by contrast, are absolutely insignificant. The balance of trade leans heavily in Senegal’s favor. For proof, the ANSD only recorded 271 million CFA francs [$585,000] in imports from Mali. We can conclude that the Malians may not be as motivated to restore connections between our two countries because, in the end, it would not help their trade deficit.

grvsmth (Author)

Comments

  1. Dan Thompson

    It is sad that walls are going up in the world today – in Palestine, in Tijuana – and sad when bridges are lost. Senegal and Mali were even briefly federated upon independence after 1960. This bridge, lost for economic reasons, gives the lie to the myth of tribalism in Africa. Even Obama just bought the WTO party line that it is warfare that has kept Africa back. Mali has no history of tribal warfare (rather a system of joking cousins to let off steam). Clinton wanted to visit this bastion at the time that they had an anthopologist president, but there were not enough hotel rooms in the capital city for Bill’s entourage. The problems in Mali, as in Africa as anywhere, are economic. Left long enough, bridges are lost, festering can lead ugly places. Ala ka dememke.

  2. grvsmth

    Thank you so much, Dan, for providing that context! For the rest of our readers, Dan is an old friend of mine since college. He worked on community natural resource development and environmental education in Mali in the Peace Corps from 1995 through 1998. I visited him for a few weeks there, and was blown away by the patient, creative ways that Malians deal with what we would think of as crushing poverty and conflicting ethnic interests. It’s great to get Dan’s insight into this situation.

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