The International Monetary Fund (IMF) Executive Board has completed the sixth review of Niger's economic and financial program under the Extended Credit Facility (ECF) arrangement, as well as the second review under the Resilience and Sustainability Facility (RSF) arrangement. This completion allows for an immediate disbursement of SDR 13.16 million (approximately US$17 million) under the ECF, bringing total disbursements to SDR 171.08 million (about US$227 million). Additionally, SDR 25.662 million (around US$34 million) will be disbursed under the RSF, totaling SDR 59.88 million (approximately US$78 million).
The IMF also concluded its 2024 Article IV consultation with Niger. The country has made progress in adopting key policy recommendations and advancing its reform agenda since the last consultation in 2022. However, challenges remain due to fragility, conflict in the Sahel region, and climate vulnerabilities.
Deputy Managing Director and Acting Chair of the Board Mr. Okamura stated: "Niger remains trapped in high levels of fragility and conflict, which are exacerbated by climate shocks." He noted that political instability following a military takeover in July 2023 has impacted economic conditions but expects a robust recovery with GDP growth estimated at 8.8 percent in 2024.
Economic growth is projected to remain strong at 7.9 percent in 2025 due to full-capacity oil production and normalized trade activities with Benin. Inflationary pressures are expected to decrease following a favorable agricultural season.
Despite these prospects, Niger faces fiscal challenges with a funding squeeze reliant on costly regional financing and liquidity pressures within its banking sector. External debt distress risks are high though deemed sustainable over the medium term.
For the ECF arrangement, performance was mixed; two out of three performance criteria were met while only two out of six indicative targets were achieved. Progress includes integrating the Solidarity Fund for Safeguarding Homeland into the budget and revising tax codes.
Executive Directors stressed revenue-based fiscal consolidation is essential for creating fiscal space while maintaining debt sustainability: "Directors emphasized that revenue based fiscal consolidation is essential to create fiscal space to address development needs while maintaining debt sustainability."
They urged improvements in public spending efficiency and emphasized enhancing governance frameworks as crucial steps toward tackling sources of fragility: "Directors underscored...enhancing governance...and public financial management."
Future consultations are planned according to Executive Board decisions on member cycles with fund arrangements.