An International Monetary Fund (IMF) staff mission led by Cheikh Anta Gueye visited Niamey from September 14 to 28, 2015 to conduct discussions on the sixth and seventh reviews under a program supported by an Extended Credit Facility (ECF) arrangement, approved by the IMF Board on March 16, 2012 (see Press release 12/90). The mission also discussed the government’s request for an augmentation of access under the PRGT, and the extension of the program for a period of one year.
At the end of the mission, Mr. Gueye issued the following statement:
“The Nigerien authorities and the IMF team reached a staff-level agreement for completing the sixth and seventh reviews of the ECF-supported program. Subject to approval by IMF management and the Executive Board, the government’s policies could be supported with a disbursement of SDR 39 million (about CFAF 32 billion). Executive Board consideration is expected in November 2015.
“Niger’s overall macroeconomic performance has been satisfactory despite the security and humanitarian shocks. After an acceleration to 6.9 percent in 2014, driven by agriculture and services, gross domestic product (GDP) growth is forecast at 4.4 percent in 2015 due to a slower growth in agriculture and a lower production in the oil and mining sectors. Inflation was negative (-0.9 percent) in 2014 and has remained moderate in 2015, with an average annual rate of 0.1 percent in August 2015, owing the good harvest and the government program promoting the sale of cereals at a moderate price, to support vulnerable groups.
“Weak revenue collections, unanticipated security expenditure, and a shortfall in external budget assistance all adversely impacted fiscal outcomes including the accumulation of domestic arrears and the scaling back of priority expenditures; and, as a result, most of the program’s fiscal targets for end-2014 were missed.
“However, significant progress has been made in 2015 with a large number of program targets met, along with the substantial clearance of domestic payment arrears. The government has also made solid progress in implementing structural reforms.
“The economic outlook for the medium-term remains favorable. Real GDP growth is expected to average 6.5 percent during 2016- 2018, mainly as a result of the expansion of the extractive industries sector and an increase in public and private investments. Inflation is expected to remain contained below 2 percent, well below the 3 percent WAEMU convergence criterion. The medium-term prospects however remain subject to substantial external and domestic risks, including the negative externalities of regional conflicts and the country’s vulnerability to natural disasters.
“In that context, the government plans to submit to the National Assembly a draft supplementary budget for 2015 and a draft budget law for 2016 consistent with its development priorities and to gradually begin taking steps to address fiscal imbalances in order to preserve fiscal sustainability. The mission and the authorities agreed on a revised structural reforms agenda for the remainder of 2015 and for 2016 centered on revenue mobilization, debt and expenditure management, natural resource management, and the business environment.
“The mission met with President Issoufou Mahamadou and Prime Minister Brigi Rafini, the Minister of Economy and Finance, Mr. Saidou Sidibe, the Minister for Energy and Petroleum, Mr. Foumakoye Gado, the Minister of Commerce and Private Sector Development, Mr. Alma Oumarou, and the National Director of the BCEAO, Mr. Maman Karim, as well as other senior government officials. The staff also met with representatives of trade unions, the private sector, and technical and financial partners.
“The IMF mission would like to thank the authorities for their warm hospitality and for the constructive discussions.”
The Extended Credit Facility (ECF) is the IMF’s main tool for medium-term financial support to low-income countries. Financing under the ECF carries a zero interest rate, with a grace period of 5½ years, and a final maturity of 10 years.
End-of-Mission press releases include statements of IMF staff teams that convey preliminary findings after a visit to a country. The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF’s Executive Board. Based on the preliminary findings of this mission, staff will prepare a report that, subject to management approval, will be presented to the IMF’s Executive Board for discussion and decision.