Overview

Country Overview

Niger is a large landlocked country of 1.27 million square kilometers. As of January 2016, the population of Niger was estimated to be 19.8 million and a population growth rate of 3.9%, one of the fastest population growth rates in the world. Niger is prone to political instability, chronic food security, and natural crises, notably droughts, floods and locust infestations.

Political Context

In 2011, Mahamadou Issoufou of the Socialist Party was elected president, and a new government was formed. In accordance with the constitution, an Economic, Social and Cultural Council and a High Court of Justice were also established. In August 2013, the Speaker of the Parliament, Hama Amadou, broke out of the ruling coalition and became the main challenger to President Issoufou, and political tensions have been stirring since. In November 2015, Amadou was imprisoned under allegations of child-trafficking.

The 2016 presidential and legislative elections took place on February 21, 2016. The incumbent candidate President Mahamadou Issoufou gained 48% of the votes and Hama Amadou, who campaigned from behind bars via proxies, was second with 17%. As neither candidate took 50% of the vote, a run-off election took place on March 20, 2016 with incumbent President Issoufou winning 92% of the votes.  The run-off elections were boycotted by supporters of Hama Amadou, resulting in low voter turnout, and continue to be contested by the opposition.

On the security front, in February 2015, Niger’s parliament unanimously approved the deployment of troops as part of a regional offensive against the armed group Boko Haram. The resolution authorized the country to send some 750 troops to Nigeria to join a regional combat operation. As a result of Niger’s participation in this operation, the country was repeatedly attacked by Boko Haram resulting in hundreds of casualties and wounded, as well as thousands of refugees fleeing the conflict in search of safer havens in Niger. The government has declared a state of emergency in its southeastern region.

Economic Overview

Despite a difficult external environment, Niger’s economy is performing well. Low average rainfall and insecurity affecting the production of uranium was offset by the increase of revenues generated from the production of oil which is estimated at 18,000 barrels/day. In 2014, economic growth accelerated to 6.9%, thanks to a rebound in agriculture and large public investment projects. Economic growth is still highly dependent on climatic conditions, large-scale investment projects in extractive industries, and security conditions. In 2015, GDP was 4.4%, down from 6.9% in 2014. This deceleration is mainly due to a 3.5% contraction of the agriculture sector. As prices are mainly driven by food supply, annual consumer price inflation slightly rebounded to 1% in 2015, yet remain well below the West African Economic and Monetary Union (WAEMU) convergence criteria of 3%.

Growth is expected to rebound in 2016 up to 5%, driven mainly as always by the mining and agriculture sectors. If current trends are maintained, average inflation would remain in check.  Security at the borders with Mali, Libya, and Nigeria, as well as climatic and commodity-price shocks, will nonetheless continue to expose Niger to significant macroeconomic risks. 

From a macroeconomic perspective, risks of disruption through growing external or fiscal imbalances continue to be moderate, given the protection and related fiscal policy obligations provided by the WAEMU. However, debt sustainability risks, still considered moderate at the end of 2014, will continue to require close attention given the rapid increase in external public debt (from  27% in 2014, to 33% in 2015 and 35% in 2016) to finance projects in extractive industries, in a context of declining uranium and oil prices. The increase is projected to peak at 37% in 2018 before declining as projects are completed. Given such exposure, the quality of debt and public investment management will continue to have an important bearing on debt and fiscal sustainability. Overall fiscal balance deficit improved from 8.3% of GDP to 7.3% in 2015, and is projected to be 7.5% in 2016.

Medium-term outlook

The social and economic impacts of the ongoing military intervention against Boko Haram on the southeastern border with Nigeria are yet to be fully known. However, preliminary estimates suggest that the fiscal impact in terms of additional security expenditure and the need to host refugees could cost 1% of GDP on an annual basis, crowding out equivalent resources to finance economic development investments.

Increased dependence on extractive revenues could indeed make the budget and public investment in particular more vulnerable to price and production changes. In addition, a larger demand for non-tradable goods and services fueled by growing revenues could affect external price competitiveness. In the face of such risks, the introduction of stabilization mechanisms and improved investment management considered under the new development policy operation (DPO) series would constitute powerful responses.

Social Context

The recent violent clashes between Boko Haram and the Nigerian army have displaced over 115,000 people from Nigeria into Niger. Refugees are concentrated in Diffa, a region suffering from food insecurity and which is currently experiencing an unprecedented humanitarian crisis. In response, the government of Niger has put forward a contingency plan of $40 million and requested the assistance of development partners to help cope with the immediate humanitarian needs up until March 2015. The World Bank Group which has established an Immediate Response Mechanism (IRM) that allows uncommitted resources (contingency funds) under projects in the existing portfolio to put together a Compact Response to help alleviate this economic burden.

With a poverty rate of 48.9% and a per capita income of $420, Niger is one of the world’s poorest nations. In 2015, it ranked 188th of 188 countries on the United Nations Human Development Index. 

Last Updated: Apr 13, 2016

World Bank Group Engagement in Niger

The International Development Association (IDA) has supported Niger’s efforts to improve economic management, public sector performance, economic growth, infrastructure, and core basic service delivery in energy, water, basic education, and health.

The current Country Partnership Strategy (CPS) discussed by the World Bank Group Board of Directors in April 2013 aims to make the Bank’s interventions more conflict and gender sensitive to promote greater inclusiveness. The strategic objectives of the CPS are to help Niger to achieve resilient growth, reduce vulnerability, and strengthen capacity for service delivery. In addition, the CPS is fully aligned with the 2012-2015 government Plan for Social and Economic Development (Plan de Développement Economique et Social or PDES) and the World Bank strategy for Africa. The World Bank Group completed a Performance and Learning Review (PLR) of the CPS with Niger, and presented it to the Board of Directors in June 2015. The PLR assesses the implementation of the CPS and adjusts it to changes in the country context.

Last Updated: Apr 13, 2016

As of April 2016, the Niger portfolio comprises of 17 active national projects amounting to more than $1.4 billion. Sector representation in terms of commitments is as follows: water, sanitation and flood protection (22%); agriculture and environment (18%); health, education and other social services (33%); infrastructure (22%) and public sector (5%).

In addition, Niger benefits from five regional operations: the West African Agricultural Productivity Program,  the initial implementation of the second phase of the Kandadji Growth Pole (APL 2A), and the recently approved Sahel Women’s Empowerment and Demographic Dividend, the Regional Sahel Pastoralism Support Project, and the Sahel Malaria and Neglected Tropical Diseases Project. These five regional operations amount to a total of $423 million.

Agriculture and Climate Resilience

In response to the August 2014 livestock crisis, three IDA projects have provided a timely and key response to the government’s request.

Through the third phase of the Niger Community Action Program, the World Bank ensured the following:

  • The delivery of 1,394 tons of cattle feed to 29 districts for a total amount 461 million FCFA through sub-projects presented by the affected rural districts
  • The construction of storage facilities for the aforementioned districts
  • The preparation of a final report on the support to the pastoral emergency response

Through the Niger Community Action Project for Climate Resilience:

  • The delivery of 1,076 tons of animal feed to 5,380 beneficiaries in 11 affected districts
  • A cash transfer started in August 2014 to support herders that lost their animals. In the 11 districts supported by the project, a total of 106 million FCFA was distributed to 1,320 households, each receiving 80,000 FCFA

Through the Niger Agro-Pastoral Export and Market Development Project:

  • More than 3,824 subprojects throughout the onion, cowpea, livestock/hides and skins supply chains have been financed for a total amount of $16 million
  • A structuring of agricultural commodity chains resulted in the implementation of 62 regional agricultural colleges with more than 2,000 actors
  • 13 subprojects were created to protect onion production sites and secure more than 1,340 hectares of crops
  • 14 groundwater recharge thresholds were completed to help secure 2,228 hectares

Social Safety Nets

The Niger Safety Net Project looks to establish and support an effective safety net system which will increase access to cash transfers and cash for work programs to poor or food insecure populations. The project has already yielded the following results.

  • 42,949 beneficiaries have received cash transfer payments totaling $6.7 million in the five targeted regions of Dosso, Maradi, Tahoua, Tillabery and Zinder
  • 798 villages have been participating in accompanying measures to the cash transfer, which aim to promote parenting practices conducive to early childhood nutrition and development.
  • 502 community groups in targeted areas were organized and registered, 82 of which started income generating activities
  • In the cash for work program, 26,777 beneficiaries have received cash payments totaling $3.6 million to facilitate micro-projects.

Last Updated: Apr 13, 2016

The development partners’ community in Niger is comprised of traditional and non-traditional donors. The OECD/DAC (Organization for Economic Cooperation and Development/Development Assistance Committee) serves as the umbrella group for coordination. Co-chaired by the World Bank Group and the United Nations Development Programme (UNDP), the group meets on a monthly basis. The Joint Consulting Commission for Donor States (Commission Mixte de Concertation États-Donateurs), under the leadership of the prime minister’s office, meets up to four times a year depending on the emerging issues (such as food insecurity last February and the flood crisis last June).

Last Updated: Apr 13, 2016


LENDING

Niger: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments