IMF Executive Board Completes the First Review Under the Extended Credit Facility Arrangement for Niger, and Approves US$52.6 Million Disbursement
IMF News, June 29, 2022
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- IMF Executive Board Completes the First Review Under the Extended Credit Facility Arrangement for Niger, and Approves US$52.6 Million Disbursement
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- Published: June 29, 2022
Overview and Disbursement
- Executive Board completed the first review of Niger’s program under the Extended Credit Facility (ECF) arrangement on June 29, 2022.
- The completion of the review enables the disbursement of SDR 39.48 million (about US$52.62 million), bringing total disbursements under the arrangement to SDR 78.96 million (about US$105.24 million).
- Niger’s three-year ECF arrangement was approved on December 8, 2021 for SDR 197.4 million (about US$275.8 million at the time of program approval or 150 percent of quota).
- The arrangement is expected to catalyze additional bilateral and multilateral financial support.
Program Performance and Structural Reforms
- Program performance has been broadly satisfactory with all quantitative performance criteria and indicative targets (ITs) at end-December 2021 met.
- Three ITs were missed at end-March 2022.
- The structural reform agenda is advancing well.
- Structural and governance commitments stated by authorities include:
- Strengthen the AML/CFT framework.
- Implement the new asset declaration template.
- Reinforce control mechanisms of the expenditure chain to reduce vulnerability to corruption and embezzlement risks.
- Systematically prosecute public officials suspected of corruption.
Economic Outlook and Risks
- The near and medium-term economic outlook for Niger is described as broadly favorable with growth projected to bounce back in 2022 and accelerate thereafter with the start of oil exports through the new pipeline.
- Immediate risks and pressures:
- An acute food crisis caused by adverse climate conditions.
- A deterioration of the security situation in the Sahel region.
- The war in Ukraine exacerbating challenges by impacting food and fertilizer prices.
- Authorities are responding to the food crisis with donor support.
Fiscal Policy, Revenue Mobilization, and Spending
- A temporary deviation from fiscal targets over 2022-23 is warranted to accommodate urgent spending needs related to the food crisis and lower budget-support grants from donors.
- Authorities remain committed to reverting to the WAEMU fiscal deficit norm in 2024.
- Domestic revenue mobilization is critical to create fiscal space for priority spending. Planned steps include:
- Reduce tax exemptions and evasion.
- Revise the tax code to simplify the system and broaden the tax base.
- Strengthen revenue administration through digitalization.
- Reforms to enhance spending quality are being implemented to improve the provision of public goods.
- Strengthening public financial management is essential to scale-up and better target spending on education and social programs to build human capital and improve protection of the vulnerable.
Financial Sector Issues
- Rising financial sector vulnerabilities, including those related to deteriorating asset quality, particularly in the microfinance sector, will need to be carefully monitored.
- Further efforts to foster financial inclusion are needed.
Selected Economic and Financial Indicators, 2018-22
(Annual percentage change unless otherwise indicated)
- GDP at constant prices: 2018: 7.2; 2019: 5.9; 2020: 3.6; 2021: 1.3; 2022: 6.9
- Export volume: 2018: -6.9; 2019: -2.7; 2020: -0.9; 2021: -8.1; 2022: 1.0
- Import volume: 2018: 8.7; 2019: 9.3; 2020: 3.1; 2021: 0.6; 2022: -2.3
- CPI, annual average: 2018: 2.8; 2019: -2.5; 2020: 2.9; 2021: 3.8; 2022: 5.3
- CPI, End-of-period: 2018: 1.6; 2019: 4.9; 2020: 5.2
- Total revenue (percent of GDP): 2018: 26.7; 2019: -1.6; 2020: 0.5; 2021: 19.8
- Total expenditure and net lending (annual percentage change): 2018: 18.8; 2019: 8.4; 2020: 11.0; 2021: 10.8; 2022: 10.0
- Current expenditure (annual percentage change): 2018: 6.0; 2019: 2.3; 2020: 12.4; 2021: 9.1; 2022: 10.0
- Capital expenditure (annual percentage change): 2018: 33.0; 2019: 13.8; 2020: 12.9; 2021: 11.4; 2022: 10.0
- Domestic credit (annual percentage change): 2018: -12.2; 2019: 25.2; 2020: 9.2; 2021: 21.0; 2022: 19.3
- Credit to the government (net) (annual percentage change): 2018: 127.8; 2019: -89.5; 2020: 575.2; 2021: -24.3; 2022: 90.5
- Credit to the economy (annual percentage change): 2018: -4.5; 2019: 13.0; 2020: 8.6; 2021: 15.4; 2022: 19.3
- Broad money (annual percentage change): 2018: -2.1; 2019: 15.0; 2020: 17.0; 2021: 8.8; 2022: 19.3
- Selected percent of GDP series (percent of GDP):
- [unnamed series lines from source preserved in order]: 12.1; 11.2; 11.8; 21.1; 21.6
- 22.9; 24.2; 24.3
- 9.9; 9.6; 10.3; 10.7; 10.6; 12.0; 13.2
- Overall balance (incl. grants) (percent of GDP): 2018: -3.0; 2019: -3.6; 2020: -5.3; 2021: -5.9; 2022: -6.6
- Gross fixed capital formation (percent of GDP): 2018: 28.5; 2019: 30.0; 2020: 31.1; 2021: 31.6; 2022: 36.2
- Non-government investment (percent of GDP): 2018: 18.4; 2019: 20.5; 2020: 24.9
- Government investment (percent of GDP): 2018: 10.1; 2019: 10.5; 2020: 11.1
- External current account balance excluding official grants (percent of GDP): 2018: -14.6; 2019: -15.0; 2020: -15.5; 2021: -16.2; 2022: -16.7
- External current account balance (incl. grants) (percent of GDP): 2018: -12.7; 2019: -13.4; 2020: -13.8; 2021: -15.4
- Total public and publicly guaranteed debt (percent of GDP): 2018: 39.8; 2019: 45.0; 2020: 51.2; 2021: 54.1
- Public and publicly guaranteed external debt (percent of GDP): 2018: 25.3; 2019: 26.5; 2020: 33.4; 2021: 33.7
- PV of external debt (percent of GDP): 2018: 23.1; 2019: 24.5; 2020: 22.7; 2021: 23.2; 2022: 23.8
- Public domestic debt (percent of GDP): 2018: 13.3; 2019: 13.4; 2020: 17.8; 2021: 20.4
- GDP at current market prices (Billions of CFA francs): 2018: 7,134; 2019: 7,565; 2020: 7,907; 2021: 8,291; 2022: 9,085
IMF Communications Department; Press Release No. 22/237; June 29, 2022.