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Washington, DC – January 22, 2025: Today, the Executive Board of the International Monetary Fund (IMF) concluded the 2024 Article IV Consultation, completed the Sixth Review of Niger’s economic and financial program supported by the Extended Credit Facility (ECF) arrangement, and the Second Review under the Resilience and Sustainability Facility (RSF) arrangement.
The ECF arrangement for Niger was approved on December 8, 2021 and complemented by the RSF arrangement in July 2023. The completion of the reviews allows for the immediate disbursement of SDR 13.16 million (about US$17 million) under the ECF—bringing total disbursements under the ECF arrangement to SDR 171.08 million (about US$ 227 million)—and of SDR 25.662 million (about US$34 million) under the RSF —bringing total disbursements under the RSF arrangement to SDR 59.88 million (about US$78 million).
The Executive Board also concluded the 2024 Article IV consultation with Niger. Since the conclusion of the last Article IV consultation in 2022, the authorities have made some progress in adopting a number of key policy recommendations and have advanced their reform agenda.
Nonetheless, the country continues to face daunting development challenges, which are exacerbated by fragility, conflict in the Sahel and vulnerabilities to climate shocks.
Following the Executive Board discussion, Mr. Okamura, Deputy Managing Director and Acting Chair of the Board, issued the following statement:
Niger remains trapped in high levels of fragility and conflict, which are exacerbated by climate shocks. Political instability and sanctions following the military takeover in July 2023 have severely and persistently affected economic and social conditions. Despite headwinds, a robust recovery is expected, with GDP growth estimated at 8.8 percent in 2024, owing to the start of oil exports, the lifting of sanctions, and increased agricultural production.
Economic growth should remain strong at 7.9 percent in 2025 driven by oil production in full capacity and the expected normalization of supply chains and cross-border trade activities with Benin. Inflationary pressures should gradually recede owing to a favourable agricultural season. But risks to the outlook are skewed to the downside.
Although the fiscal deficit is expected to narrow to 3 percent of GDP by 2025, Niger continues to experience a funding squeeze with a high reliance on costly regional financing. The banking sector is confronted with liquidity pressures and financial stability risks have increased.
Niger’s risks of external and overall debt distress are high, though debt remains sustainable over the medium term. Roll-over risks for domestic debt are particularly elevated.
For the ECF arrangement, performance through end-September was mixed. Two out of three performance criteria (PCs) were met; however, only two out six Indicative targets (ITs) were met. Significant progress has been made regarding the implementation of structural benchmarks, including the integration of the Solidarity Fund for the Safeguarding of the Homeland (FSSP) into the 2025 budget, the adoption of an oil revenue management strategy, and the revision of the General Tax Code (CGI). For the RSF arrangement, all the three reform measures (RMs) for this review were implemented.
The implementation of policies to use efficiently the country’s natural resources, expand fiscal space through domestic revenue mobilization and increased spending efficiency, manage fiscal risks and reduce vulnerabilities to shocks, is essential to sustainably address development needs.
Moreover, it is critical to strengthen the private sector’s contribution to growth, including by stepping up efforts to enhance the stability and soundness of the financial sector and address debt service arrears. Progress in transparency and anti-corruption frameworks is also crucial to tackle the sources of fragility and improve the business environment.
