A mission of the International Monetary Fund (IMF), led by Mr. Ekué Kpodar, visited Niamey during December 9-20, 2013 to hold discussions with the Nigerien authorities on the second and third reviews of the economic and financial program supported by the IMF's Extended Credit Facility (ECF).
The program was approved by the IMF Executive Board on March 16, 2012 (see Press release No. 12/90) in an amount of SDR 78.96 million (about US$ 121million).
At the end of the mission, Mr. Kpodar made the following statement:
"The mission held frank and fruitful discussions with the Nigerien authorities. Economic performance has been relatively satisfactory, although it was affected by the negative effects of the regional security situation and the climate shock in 2013.
Real gross domestic product (GDP) was revised downward to 3.6 percent in 2013, a reduction of about 2.5 percent compared to the initial projections, and well below the 11 percent recorded in 2012 as a result of the start of oil production.
Inflation remains relatively low at 2.5 percent in 2013, thanks in particular to the impact of the government's food aid program, which help attenuate the increase of the prices of food products.
"Program implementation has been broadly satisfactory in spite of a few difficulties encountered during the first half of the year.
During the first ten months of 2013, the overall fiscal balance (commitment basis, including grants but excluding net lending) recorded a deficit equivalent to 2.7 percent of GDP and is estimated at 3 percent for end-December 2013, against a 4.3 percent GDP deficit initially projected in the program.
This performance is mainly due to the fact that capital expenditure was lower than had been anticipated in the program.
"The economic outlook for 2014 and the medium term remain favorable. Real GDP growth is expected to accelerate to reach 6.5 percent in 2014, mainly as a result of the expansion of the extractive industries sector, a better agricultural season, and an increase in public investments.
Inflation would remain contained below the 3 percent WAEMU convergence criterion. The medium-term prospects remain subject to substantial external and domestic risks, including the fragile regional security situation and Niger's vulnerability to natural disasters.
"Staff and the authorities agreed on a budgetary framework for 2014 that seeks to contain current expenditure; to ensure that capital expenditure takes into account absorption capacity, while improving efficiency in public investments, and to replenish fiscal buffers. The overall fiscal deficit (excluding net lending) would be limited to 3.7 percent of GDP.
"The Nigerien authorities have expressed their strong determination to keep the economic and financial program on track.
The authorities and the mission agreed on a set of structural measures to be implemented in 2014 with a view to strengthening budget execution, customs administration and fiscal revenue mobilization, and improving debt management.
The authorities also restated their intention to pursue their efforts in the area of financial sector reform, ensure transparency and good governance in managing natural resources, and continue to improve the business climate. Some of these measures will be discussed in greater details during the next mission.
"The mission wishes to express its gratitude to the authorities for their warm hospitality and the frank and constructive discussions."
The mission met with the President of the Republic, the Prime Minister, the Minister of Finance, and the Senior Minister in charge of Planning.
The mission also met with the National Director of the Central Bank of West African States, senior government officials, private sector and civil society representatives, as well as development partners in Niger. Mr. David Robinson, Deputy Director in the African Department of the IMF, joined the mission for a few days.