Niger: IMF Executive Board Completes the Fifth Review Under the Extended Credit Facility Arrangement for Niger and Approves a Us$19.5 Million Disbursement

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On January 8, 2020, the Executive Board of the International Monetary Fund (IMF) completed the fifth review of Niger's economic and financial program supported under the Extended Credit Facility (ECF) framework. The completion of the review enables the disbursement of SDR14.1 million (about US$19.5 million), bringing total disbursements under the arrangement to SDR104.34 million (about US$144.1 million).

The Executive Board also approved the authorities' request for the modification of performance criteria pertaining to domestic budget financing and the contracting of public or publicly guaranteed external public debt.

Niger's three-year arrangement was approved on January 23, 2017 for SDR98.7 million (about US$136.4 million) in support of the authorities' national plan for economic development. It aims to enhance macroeconomic stability and foster high and equitable growth, boost incomes and create jobs, while strengthening the foundations for sustainable development. On December 10, 2018, the IMF Executive Board agreed to augment the overall amount of the ECF arrangement to SDR118.44 million (about US$163.6 million, or 90 percent of Niger's quota).

Following the Executive Board's discussion on Niger, Mr. David Lipton, First Deputy Managing Director and Acting Chair, issued the following statement:

"Overall program performance was broadly satisfactory. All performance criteria and indicative targets were met for the first half of 2019, but fiscal results started to slip in the third quarter. The authorities are taking corrective measures. Nonetheless, program targets for end-December 2019 needed adjustment to account for revenue shortfalls and higher-than-expected foreign grants. Implementation of the structural reform agenda is progressing reasonably well.

"Economic activity is expected to develop favorably, with annual average growth topping 7 percent over the next five years. Large-scale donor-funded projects and foreign direct investment are important drivers. The construction of a pipeline for crude oil exports, which are scheduled to commence in 2022, is an important boon for the economy. The tense security situation in the Sahel region as well as challenges from climate change remain downside risks.

"It will be important to make the best of the prospective oil exports from 2022. The institutional framework for managing the oil sector should conform to good international standards and the prudent use of the additional revenues needs advance planning to secure their maximum development impact.

"The mobilization of fiscal revenues remains a significant challenge. While progress is being made, rigorous implementation holds the key to raising revenues further. In addition, it will be important to improve the quality and efficiency of spending to protect the poor. Fiscal risks from public-private partnerships need to be carefully assessed, including through rigorous cost-benefit analyses.

"Niger is making progress with improving the framework to fight corruption. The re-application to the Extractive Industries Transparency Initiative and advances with bringing the asset declaration regime for public officials closer to good practices are noteworthy. Efforts are needed to boost access to credit and enhance financial inclusion, as well as improving the business environment, enhancing human capital, and addressing gender inequality."

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