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The government of Senegal plans to annul a USD 757 million contract with a Saudi Arabian firm to build a water desalination plant. This is the first major international deal to be scrapped since President Bassirou Diomaye Faye’s election.
The government of Senegal plans to annul a USD 757 million contract with a Saudi Arabian firm to build a water desalination plant. This is the first major international deal to be scrapped since President Bassirou Diomaye Faye’s election. Faye had pledged to review and potentially cancel deals signed by his predecessor Macky Sall, whom he accused of damaging the country’s sovereignty by selling off state assets too cheaply. The desalination project, hailed as one of the biggest private investments in the country, was signed by Saudi Arabia’s Acwa Power and Senegal’s state water company SONES in the final days of Sall’s presidency. The plant near Dakar was to have provided around 400,000 cubic metres of water for the fast-growing capital and other regions as demand soars.
This project no longer fits with the government’s strategy options. The government has decided not to pursue it, stated Senegal’s water minister Cheikh Tidiane Dieye. He had announced on television late on Wednesday that Senegal was to pay USD 33 million a year for the water from the plant, whose construction has not yet begun. The price of the water risks increasing because of the technology being used and the required environmental studies were not carried out. He added that in three or four years the country will need more than 400,000 cubic metres per day because the population of Dakar is growing.
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Dieye said the government’s lawyers were studying the potential legal consequences of breaking the contract but construction of the plant has not yet started, so there cannot be any financial damages for ACWA.
Faye, a pan-Africanist who swept to power promising to recover Senegal’s “sovereignty”, has said foreign deals in mining, oil, and gas, and other key sectors signed under Sall would also be reviewed.
