March 23 (Bloomberg) -- Senegalese President Abdoulaye Wade will face his former ally, Macky Sall, in an election runoff March 25, pitting his bid for a third term in office against an opposition that has rallied around Sall.
Wade, 85, won 34.8 percent of the votes in the first round, not enough to secure victory. Sall, 50, who served as prime minister from 2004 to 2007, won 26.9 percent of the vote.
The president “faces the possibility of losing in the second round to his former prime minister and protege,” Jonathan Hyman, Africa analyst at the London-based Economist Intelligence Unit, said in an e-mailed response to questions. “The odds are now stacked against him, given the opposition’s recent re-discovery of unity.”
In the weeks before the Feb. 26 first round, Wade faced growing protests against his bid to extend his 11 years in office after his candidacy was approved by the Constitutional Court. Demonstrators claimed his third term bid violated a law that limits presidential tenures to two. At least nine people died in clashes with police during the rallies, according to Amnesty International.
Protests have halted since the first round, after observers said the vote was largely transparent and as a large group of opposition support rallied around Sall. Senegal is the only country in mainland West Africa to have never experienced a coup d’etat.
The yield on Senegal’s $500 million Eurobonds, which it sold in May are are due in 2021, dropped 4 basis points, or 0.04 percentage point, to 7.99 percent by 11:34 a.m. in Dakar, the lowest since Sept. 12, according to data compiled by Bloomberg.
“We had been negative on the 21s before the first round of the presidential election because of the deteriorating institutional and security climate,” Samir Gadio, an emerging-markets strategist with Standard Bank Group Ltd., said in an e-mail to clients.
“The smooth electoral process since and the possibility of an orderly transition in coming days would boost Senegal’s historical reputation of political stability,” he said. “This in turn is now shifting short-term risks to the yield outlook to the downside.”
Sall’s coalition, called Benno Bokk Yakaar, or Grouping of Forces for Change in the local Wolof language, includes 12 of the 14 candidates who ran in the first round. It brings together civil-society groups that organized the anti-Wade protests, such as Y’en a Marre and Mouvement 23, as well as Grammy award-winning singer Youssou N’Dour, whose candidacy was invalidated by the Constitutional Court on a technicality.
Senegal gained independence from France in 1960, and has had three leaders since then. Wade has been in power since he took over in 2000 from Abdou Diouf, who ruled for 19 years. Sall was prime minister under Wade from 2004 to 2007.
While Sall’s coalition brings together candidates who won more than 65 percent of the votes in the first round, Wade may win voters’ favor with a pledge to step down after three years to be able to finish infrastructure projects, such as a new toll road and a 230 billion CFA-franc ($430 million) international airport.
Rather than wait for Sall to finish a possible two terms, “voters may prefer to have Wade in power for three years, giving their candidates another chance to be elected,” said Abdou Fall, Senegal analyst at the Institute for Security Studies in Pretoria, South Africa. “It is a long-term calculation,” he said in an interview in the capital, Dakar.
Wade also has the support of religious leaders, known as marabouts, who have given instructions to their followers to vote for him, Fall said. “In the rural areas, the voting instructions are powerful,” he said. Around two-thirds of voters live outside Dakar.
If there is a narrow margin between the results of the two candidates, this “could lead to allegations of fraud on both sides, legal challenges and a strong likelihood of short term instability which would have negative impact on markets,” said Anna Osborne, senior analyst at Bath, U.K.-based Maplecroft, a risk analysis company.
In Ivory Coast, the biggest economy in the eight-member West African monetary union that doesn’t include Nigeria and Ghana, a disputed presidential election in November 2010 led to five months of violent clashes and an economic contraction of 4.7 percent, according to the IMF. The country also defaulted on its $2.3 billion Eurobonds after missing a coupon payment.
“Wade will not try to cling to power like Cote d’Ivoire’s ousted leader Laurent Gbagbo, and the military would not support him if he did,” said Philippe de Pontet, Africa director for the New York-based Eurasia Group.
“If Sall wins he will face the daunting task of keeping his loose coalition intact. Parliament could wind up as a significant check on executive power,” he said in an e-mailed response to questions. Legislative elections will take place later this year.
Senegal uses the monetary union’s CFA franc currency, which is pegged to the euro. It gained 0.2 percent to 498.27 per dollar by 11:37 a.m. in Dakar.
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