major macro economic indicators
|2019||2020||2021 (e)||2022 (f)|
|GDP growth (%)||5.9||3.6||5.5||6.2|
|Inflation (yearly average, %)||-2.5||2.8||2.9||2.5|
|Budget balance (% GDP)*||-3.6||-4.9||-6.8||-5.3|
|Current account balance (% GDP)*||-12.7||-13.5||-15.3||-16.0|
|Public debt (% GDP)||39.8||45.0||48.5||49.4|
(e): Estimate (f): Forecast *Including grants
- Sixth largest uranium producer in the world in 2019
- Net exporter of petroleum products and gold
- Investment effort in agriculture and infrastructure
- Member of the West African Economic and Monetary Union (WAEMU) and the Economic Community of West African States (ECOWAS)
- Financial support from multilateral creditors
- Economy vulnerable to climate shocks and commodity price fluctuations
- Economy still largely dependent on subsistence agriculture
- Rapid population growth, high poverty (lowest HDI in the world), chronic food crisis situation
- Poor tax and duty collection system
- Endemic corruption and large informal sector
- Porous borders favouring illegal immigration and trafficking (gold, oil...)
- Deteriorating security situation and terrorist attacks
Growth supported by investment projects in the oil sector
In 2021, growth in economic activity got back to levels close to those seen before the COVID-19 crisis. In 2022, the continuation of major infrastructure projects and the development of new oil fields for export should support an acceleration of the growth rate. Investment will be particularly buoyed by the construction of the nearly 2,000 km long Niger-Benin oil pipeline by the China National Petroleum Company. Delayed by the pandemic, this USD 7 billion project was revived in May 2021 and could significantly increase the country's export capacity by 2023. In addition, investment in the Lomé-Ouagadougou-Niamey economic corridor, which could improve regional connectivity, and in the Kandadji hydroelectric dam will also provide a lift. The construction and service sectors stand to benefit from these massive investments. Strong performances in gold and oil production thanks to high commodity prices should also support the recovery in exports. However, uranium production will fall following the closure of the Akouta mine in March 2021, limiting the contribution of foreign trade to growth. Agriculture (42% of GDP), on which 80% of the population depends, will benefit from the reopening of the borders with Nigeria. In addition, the 3N initiative (which translates as "Nigeriens Feed Nigeriens") will support strong production in the agricultural sector, whose bright outlook will bolster household consumption. However, this recovery, like that of private investment, could be hampered by climatic conditions (flooding, drought, locust invasion) and persistent security threats.
Fiscal consolidation and a widening current account deficit
The fiscal deficit is expected to continue to shrink, mainly due to increased revenues. Customs duties and improved tax revenue mobilisation following a pandemic-related deterioration will contribute to this. On the expenditure side, the government will focus on reducing the wage bill, which absorbs almost one-third of tax revenues. Capital expenditure, financed from external resources, will increase. Fiscal pressures will continue owing to Niger's unstable security situation, with nearly 10% of the country's budget devoted to military and security spending in 2021. Financing will rely mainly on concessional external resources. External public debt, which accounts for nearly 70% of public debt, is already largely held by multilateral creditors, reducing the risk of debt distress. Niger will continue to benefit from the three-year ECF programme of USD 278.5 million, approved in December 2021 by the IMF, following the USD 167.9 million programme from 2017 to 2020.
In 2022, the current account deficit is expected to widen, with the gradual increase in export earnings unable to offset the higher import bill. The trade balance will therefore remain largely in deficit, mainly because of imports of capital goods needed for infrastructure projects. The primary income account deficit will widen due to the repatriation of dividends by non-residents, while the current transfers account will continue to show a surplus, linked to current international cooperation and expatriate remittances. In addition to multilateral aid, the deficit will also be financed by a rebound in FDI, chiefly from China and France, which is expected to double between 2021 and 2022 as the deployment of public infrastructure attracts private investment.
A new president, but socio-political and security challenges persist
Former minister Mohamed Bazoum of the Niger Party for Democracy and Socialism (PNDS) was sworn in as president in April 2021 after surviving an attempted coup by dissidents in the army. The outcome of the election, held in February, was contested by opposition candidate Mahamane Ousmane (a former president overthrown in a 1986 coup), stoking opposition anger after years of contentious results under the PNDS. Social and political stability will remain extremely fragile in a country where poverty continues to be widespread and famines are a regular occurrence.
Meanwhile, the political risk associated with terrorist attacks remains high. The Tilllabéri region, also known as the tri-border region because of its borders with Benin, Burkina Faso and Mali, is regularly hit by jihadist groups affiliated with al-Qaeda or the Islamic State, killing at least 69 people in the November 2, 2021 attack in Banibangou. The fight against the terrorist threat in the Sahel remains at the heart of the country's international cooperation, particularly within the G5 Sahel framework.
Last updated: February 2022