The World Bank in Niger

COUNTRY OVERVIEW

Niger, which is located in the heart of the Sahel, has a poorly diversified economy, with agriculture accounting for 40% of its GDP. More than 10 million persons (41.8% of the population) were living in extreme poverty in 2021.

Niger is grappling with an influx of refugees fleeing conflicts in Nigeria and Mali. As of August 31, 2022, the United Nations High Commissioner for Refugees (UNHCR) had identified 294,467 refugees and almost 350,000 displaced persons in the country.

Political Context

Mohamed Bazoum, the candidate of the party in power, was elected president in elections held in December 2020 and February 2021, marking the first democratic transfer of power in the country’s history.

Niger is facing a security crisis in the areas bordering Nigeria, Burkina Faso, and Mali, where armed groups carry out repeated attacks against the security forces and civilians. A state of emergency was declared in the Diffa, Tahoua, and Tillaberi regions.

Economic Overview

After weak 1.4% GDP growth in 2021, economic growth in 2022 is estimated at 11.5%. Agricultural production increased by 27%, thanks to a better-than-average rainy season and the expansion of irrigated production, which more than compensated for the decline in mining and manufacturing. At the same time, the services sector benefited from the expansionary fiscal policy and the construction of the oil pipeline, which boosted market services and transport.

Global commodity prices and continuing pressures on the domestic food market pushed the average annual inflation rate to a 10-year high of 4.2% in 2022, up from 3.8% in 2021. Niger nevertheless had the lowest inflation rate in the WAEMU region.

Outlook

In 2023, real GDP growth is projected to be in line with potential, at 6.9%, and increase further in 2024 to 12.5%. This is due to the launch of large-scale oil production and exports, continued donor support, and an economic reform program designed to boost overall productivity and strengthen economic governance, bringing GDP per capita to a level 15% higher than in 2021.

Inflation is projected to fall to 3.2% in 2023 and to 2.8% in 2024 as food inflation moderates, before rising slightly in 2025 owing to additional demand fueled by oil revenues. As a result of increased food imports, the current account deficit will reach 17% before narrowing to 11.5% with the launch of oil exports.

This outlook is subject to a high degree of uncertainty and multiple risks, owing to intensified climate change-related shocks, deteriorating security conditions that could drain additional resources, a slowdown in global oil prices and/or delays in production expansion, and delays in key structural economic reforms and complementary investments.

Last Updated: Mar 23, 2023

In September 2017, Niger adopted a new Economic and Social Development Plan (PDES), which the World Bank used to prepare its Country Partnership Framework (CPF) with Niger for the period 2018–2022.  A Performance and Learning Review (PLR) of this CPR was discussed by the World Bank’s Board of Executive Directors in May 2022. It extends the current Country Partnership Framework by one year to help consolidate and achieve results, while strengthening the focus on resilience to climate change.

The World Bank’s strategy in Niger is based on three pillars:

• Boosting productivity and income in rural areas;
• Developing human capital and social protection; and
• Strengthening governance.

The goal is to accelerate economic and social development in Niger by tackling the obstacles that impede growth and poverty reduction efforts. The World Bank’s strategy also addresses fragility, conflict, and violence by supporting Niger’s response to the existing crises and helping reduce rising tensions.

On March 15, 2023, the World Bank was financing 35 operations in Niger: 22 national projects and 13 regional projects valued at $4.7 billion (grants and loans included). These projects support the development of several sectors:

• water and sanitation: 18.1%
• energy and extractive industries: 16.6%
• agriculture: 7.4%
• health and population: 5.5%
• transport: 6.6%
• social protection and employment: 6.1%
• reform, private sector: 12.6%
• education: 4.9%
• urban development, disaster management, and resilience: 6.9%
• sustainable social development: 3.4%
• governance: 6.1%
• environment and natural resources: 3.2%
• digital development: 2.1%
• poverty (0.4%)

International Finance Corporation (IFC)

In recent years, IFC has focused on identifying ways to support private sector development.

As part of the Sahel Irrigation Initiative, the Management Advisory Service (MAS) launched a project in 2016 to spur private investment in irrigated agriculture. Efforts were stepped up in late 2017 with the organization of the Niger Renaissance Conference in Paris and large-scale private sector participation.

Building on this momentum, in early 2019, the MAS team organized consultative support for some 20 SMEs in order to enhance their capacity to mobilize funds from local financial intermediaries (including IFC clients).

On the energy front, IFC announced a partnership with the government of Niger in June 2021 to develop renewable energy production under the Scaling Solar program. This agreement will enable Niger to procure utility-scale solar power from reputable independent power producers more quickly and affordably.

Last Updated: Mar 23, 2023

The following are examples of progress made possible by World Bank financing:

Health:

The World Bank is contributing to Niger’s COVID-19 vaccination efforts by providing technical and financial support in the following areas:

• Support for preparedness and response through the REDISSE and COVID-19 projects
• Support with the implementation of the country’s COVID-19 response plan
• Vaccine procurement and deployment

In parallel, the Bank is continuing its efforts to maintain access to quality and affordable basic services despite the emergency response to  COVID-19, focusing in particular on maternal and child health services in order to help build the country’s resilience and support the economic recovery.

At the same time, the World Bank’s commitment to help Niger accelerate the demographic transition, improve health and nutrition, and empower women and girls is on track. The World Bank has made reducing gender inequalities a central focus of its support in Niger, including promoting girls’ access to education, reproductive health services, and economic opportunities as a key way to reduce child marriage and high fertility rates.

Key results include the following:

1.     Nearly six million women of reproductive age and children under five use a range of basic reproductive health and nutrition services, 4.2 million children are vaccinated, nearly 1.6 million births are attended by skilled personnel, and 94 percent of facilities report their monthly results on time.

2.     Improvement in girls’ access to and retention through (i) the “All Girls in School” subproject; (ii) the financing of the subproject “Safe Spaces and Clubs for Future Husbands.”

3.     Improved supply chain of reproductive, maternal, newborn, child, and adolescent health products.

Energy

The World Bank’s efforts in Niger’s energy sector address four related challenges: (i) significantly increase access to electricity for all, improve the quality of access to electricity for current and future consumers by strengthening and developing the energy infrastructure; (ii) increase the availability of electricity to the population through the development of new and renewable energy sources; (iii) increase and diversify low-cost, low-emission electricity supply sources through domestic renewable energy sources and regional electricity interconnections; and (iv) ensure the financial viability of the energy sector for a sustainable, high-quality and affordable electricity supply for the population.

In light of these challenges, Niger and the World Bank have developed a partnership rich in commitments throughout the energy sector value chain, mobilizing significant financial resources. The World Bank’s current commitment to Niger stands at $1,207.5 million for the financing of three national projects and four regional projects in the power sector, including the Kandadji dam program. These projects are expected to provide access to electricity for more than 4.5 million persons.

In addition, the Bank is financing and assisting the government of Niger in the preparation of a low-cost renewable energy production plan that will be a key tool for future generation capacity.

Social Safety Nets

The World Bank has been providing support to the government for almost 10 years for the development of an effective social protection system. The aim is to support the poorest households by providing monthly cash transfers in conjunction with other measures to strengthen human capital and develop productive activities. This program also helps households improve resilience and cope with unexpected shocks, such as those associated with climate change.

The Adaptive Safety Net Project 2 “Wadata Talaka” (PFSA 2), which became effective on June 20, 2019, has directly benefited more than three million persons as follows:

• 30,000 households (around 210,000 persons) have benefited from monthly transfers of CFAF 15,000^[1] over 24 months, as part of the program of cash transfers to build resilience.
• 13,200 households (about 92,000 persons) have benefited from the establishment of cash-for-work activities, which led in 2020 to the construction and/or rehabilitation of some 40 community assets.
• Cash transfers in response to the socioeconomic impact of COVID-19: 400,000 urban and rural households (approximately 2,800,000 persons) each received a one-time transfer of CFAF 45,000, with a total value of $36 million.
• 30,000 households participating in the cash transfer program benefited from the implementation of support and awareness-raising measures designed to encourage behavioral change to enhance their resilience and strengthen the human capital of their children.

^[1] On March 17, 2023, $1 was equal to CFAF 618.

Last Updated: Mar 23, 2023

The World Bank collaborates with various multilateral agencies and donors, such as the Agence Française de Développement, the African Development Bank and the European Union, to coordinate its support for Niger’s development.

In July 2017, Germany, the African Development Bank, the World Bank, France, the European Union, and the United Nations Development Programme launched the Sahel Alliance to provide an appropriate and coordinated response to the challenges faced by the G5 Sahel member countries (Burkina Faso, Chad, Mali, Mauritania, and Niger). Since then, Denmark, Italy, Luxembourg, the Netherlands, Spain, and the United Kingdom have joined the Alliance.

Last Updated: Mar 23, 2023