The bizarre color is caused by Dunaliella salina, a type of halophile green micro-algae, that is found in the water. Usually found in sea salt fields, such as in Lake Retba, the micro-algae appears pink during the dry season. The high salt content of the lake means that not only is there a booming salt collecting industry on its banks, but like the Dead Sea, you are able to float in it.
Lake Retba also has unusual properties. Dunaliella salina is known for its anti-oxidant activity as it is able to create large amount of carotenoids. As a result, it is often found in cosmetics and dietary supplements. In order to protect themselves, many salt collectors who work in the lake rub their skin with shea butter in order to avoid tissue damage.
As you might expect, the high salt levels mean that few organisms can survive in the lake, so really it simply serves as a source of salt and a weird tourist attraction. As it is located near Dakar, the site is usually the finishing point for the epic car rally.