For more information, see Niger and the IMF

Niger—Enhanced Structural Adjustment Facility
Policy Framework Paper, 1998–2001

Contents

Tables

Table 1. Niger: Financial and Structural Reforms to be Implemented, 1998-2001


Policy Area Objectives and Policies Strategies and Measures Timetable Technical Assistance

A. Management of public resources        
1. Budget Establish financial viability by generating a primary surplus See sections below 1998-2001  
2. Revenue Simplify the tax system, strengthen tax administration and auditing activities, reduce exemptions significantly, strengthen measures against evasion, and consolidate the recent enhanced revenue performance Customs Administration  
Computerize the system for monitoring the tax liabilities of taxpayers December 1999  
Establish customs revenue units 1998-2001  
Strengthen customs administration by continuing reorganization of customs units, and providing them with adequate personnel and equipment 1998-2001  
Complete the West African Economic and Monetary Union (WAEMU) tax harmonization program Review tax and customs legislation in the context of adoption and implementation of the WAEMU common external tariff December 1999 IMF/World Bank
General tax directorate  
Improve management of tax return system through computerization 1998-2001  
Recruit 75 additional full-time personnel, as well as 30 contractuals for renewable terms of one month 1998-2001  
Tax exonerations  
Implement recommendations of the review of procedures of tax exemptions granted under the mining and petroleum code and the tax regime for the uranium sector 1998  
Do not renew exemptions envisaged by the Investment Code; exclude all privatized enterprises from exemptions under the IC 1998-2001  
Eliminate all discretionary exemptions 1998-2001  
Set up an exoneration management system for petroleum products, based on prior payment of duties and taxes refundable against submission of delivery documentation December 1998  
3. Expenditure Ensure a return to financial and accounting orthodoxy, enhance the efficiency of government expenditure, and control the wage bill and size of civil service Materials and supplies    
Increase expenditure in real terms, if necessary, to improve efficiency of tax collection agencies 1998-2001  
For material and equipment expenditures intended for the health and education sectors, see below    
Public investment program  
Integrate into the cash flow the national counterpart funds for externally financed public investment projects 1998-2001  
Accelerate the government procurement procedures 1998-2000 World Bank
Extend labor-intensive works to a number of public investment projects 1998-2001  
Expenditure management
Strengthen and ensure compliance with budgetary procedures: (i) ban all exceptional procedures, specifically the advance payments (PPA); (ii) implement appropriate procedures to prevent any further accumulation of domestic arrears (see para. 22); (iii) introduce a mechanism to manage expenditure on the basis of resources mobilized; (iv) audit the Treasury; and (v) prepare Treasury accounts for 1988-97 and year-end expenditure audits [lois de règlement] for 1991-97 1998-2001 (i) 1998-2001 (ii) July 31, 1998 (iii) July 31, 1998 (iv) July 31-Sep. 1998; and (v) Dec. 1998 IMF/World Bank
4. Arrears Improve relations with domestic suppliers and foreign creditors Validate inventory of domestic arrears 1998-99  
Implement a plan for clearing domestic arrears 1998-99  
Implement a plan for settling external payments arrears 1998  
5. External debt management Ensure the sustainability of the external debt burden Contract or provide government guarantees in respect of concessional loans only 1998-2001  
Strengthen computer facilities and equipment at the unit in charge of external debt 1998-99  
B. Monetary and financial sector policies Increase the efficiency of the banking system and improve financial intermediation Continue prudent monetary and credit policies 1998-2001  
Pursue implementation of reforms in respect of monetary policy instruments adopted by the Central Bank of West African States (BCEAO), including the development of regional financial markets; ensure that interest rates reflect market conditions 1998-2001  
For Banque Commerciale du Niger (BNC), implement recommendations of the West African Monetary Union (WAMU) Banking Commission 1998-2001  
For Caisse de Prêts aux Collectivités Territoriales (CPCT), implement recommendations of the WAMU Banking Commission regarding restructuring 1998-2001  
For Crédit du Niger (CDN), implement recommendations of the WAMU Banking Commission's report of February 1997 and the measures adopted by the board of directors under the supervision of the ad hoc committee 1998-2001  
    To restructure national postal and savings agency (ONPE), ensure the liquidity of the postal services office (CCP) and the Caisse Nationale d'Epargne December 1999  
C. Civil service reform Improve efficiency of the public sector while controlling costs and number of personnel Implement the civil service reform plan 1998-2001  
Ensure that budgetary funding for total hiring (except for voluntary teachers) does not exceed the savings generated by departures, excluding voluntary departures 1998-2001  
Harmonize the results of the civil service census and the payroll and civil service databases July 31, 1998  
Implement an integrated database for civil service and payroll December 31, 1998  
Implement departure program 1998-2001  
Decentralize budgetary positions 1998-2000  
Initiate the plan to redeploy personnel in the education sector and expand the plan to redeploy health sector personnel throughout the national territory 1998-2001  
Establish special regulations to govern volunteer teachers, to be administered by decentralized local governments 1998  
D. Public enterprise reform Improve the cost-effectiveness and overall efficiency of the public enterprise sector Through appropriate mechanisms, eliminate the cross debts, arrears, and liabilities of entire public enterprise sector, particularly the 9 enterprises to be privatized (SNE, NIGELEC, SONITEL, SONIDEP, Abattoir de Niamey, OFEDES, RINI, ONAHA, and SPEHG) 1998-99  
    Implement measures aimed at ensuring regular payment of utility consumption (water, electricity, and telephone) July 31, 1998  
    Adopt severance package plan for personnel of enterprises to be privatized, compatible with the financial situation of these enterprises; identify sources of financing for the plan 1998 World Bank
    Carry out the privatization program for 9 public enterprises: 1998-99 World Bank
    • Issue invitation to bid for SNE leasing/concession contract Sep. 30, 1999  
    • Issue invitation to bid for NIGELEC concession contract June 30, 1999  
    • Resume and carry out measures to privatize the management of Abattoir de Niamey Dec. 31, 1998  
    • Issue invitation to bid for majority of SONITEL shares June 30, 1999  
    • Privatize OFEDES, RINI (transfer of government-owned shares to cooperatives), ONAHA (transfer to an economic interest group), and SPEHG 1998-99  
    • Transfer to the private sector the management of SONIDEP storage facilities March 31, 1999  
    • Adopt a regulatory framework applicable to water, electricity, and telecommunications sectors Sep. 1999  
E. Private sector promotion Stimulate private sector activities; encourage the creation of industries and small- and medium-scale enterprises; and create jobs Adopt policy framework program for private sector promotion 1998  
F. Agriculture and environment Promote sustained agricultural sector growth and food security Adopt the agricultural sector growth strategy paper Sept. 1998  
Prepare and adopt plan for restructuring sector institutions March 31, 1999 FAO/World Bank
Conduct a public expenditure review for the agriculture sector July 31, 1999 World Bank
    Update and adopt the irrigation development strategy January 31, 1999  
  Strengthen natural resource management to ensure sustainable development Adopt the National Environmental Plan for Sustainable Development (PNEDD) Dec. 31, 1998  
G. Primary education Improve access to, and quality of, primary education, 1997/2002: (i) raise enrollment ratio from 30 percent to 38 percent; (ii) raise the share of enrollment accounted for by girls from 38 percent to 42 percent; (iii) reduce repeater rate for classes at the end of the primary cycle from 37 percent to 20 percent Recruit 520 civil service teachers for October 1998 only October 31, 1998  
Recruit 790 volunteer teachers on the basis of special regulations to be administered by local governments October 31, 1998  
Recruit 1,210; 1,450; and 1,475 volunteer teachers on the basis of an evaluation of the impact of hiring volunteer teachers and the impact in terms of raising the enrollment ratio and enhancing the quality of education In October 1999; 2000; and 2001  
Revise and adopt the program, content, and the duration of teachers' training; train the second cohort of volunteer teachers 1998  
  Improve efficiency of resource use Use initially allocated budget appropriation for annual recruitment of 520 civil service teachers in favor of volunteer teachers 1999  
    Provide additional financing for volunteer teachers by internal reallocation of education sector resources originating from the following: 1998-2001  
    • Private education subsidy: (i) CFAF 83 million; and (ii) CFAF 158 million (i) 1998; and (ii) 1999; 2000; and 2001  
    • Allocations for CEG: CFAF 131 million 1999; 2000; and 2001  
    • Allocations for secondary schools: CFAF 65 million 1999; 2000; and 2001  
    • Subsidies for higher education: (i) CFAF 113 million; and (ii) CFAF 305 million (i) 2000; and (ii) 2001  
    • Increase the budget by CFAF 215 million per year for educational materials and supplies Starting 1998  
    Increase the budget by CFAF 40 million per year for outlays on fuel and maintenance for vehicles used for primary school inspections Starting 1998  
    Implement recommendations of the public expenditure review for the education sector, and conduct annual internal review of government expenditure in the sector 1998-2001  
H. Secondary education   Implement budgetary measures: reduce allocations in respect of the CEG and lycées 1999; 2000; and 2001  
  Formulate strategy on post primary education 1999  
I. Higher education   Implement budgetary measures: reduce scholarships Conduct national dialogue on higher education strategy Starting from 2000 1999  
J. Health Utilize sector resources more efficiently Update the computerized personnel database of the Ministry of Public Health in light of the results of the civil service census and the sector's first redeployment (by December 1998); then pursue the health sector redeployment plan (1999-2000) 1998-2000  
    Decentralize budgetary positions and their management 1998-2000  
    Recruit 260 employees in 1998 to work in health districts; for 1999-2000, recruit a maximum of 260 employees per year on the basis of annual review of personnel needs conducted in consultation with the World Bank 1998-2000  
    Increase nonwage current expenditure by 5 percent in real terms per year; in this category, increase by 8 percent each year expenditures for operating and maintenance of transport and technical equipment, and for maintenance of physical infrastructure; ensure realistic budgeting of financing needs in respect of electricity, water, and telephone, taking account of sector expansion 1999-2000  
    Develop action plan to privatize maintenance and repair services in respect of the motor vehicle fleet (Ministry of Public Health) in 1998, and implement it by June 1999 1998-99  
    Implement recommendations of the public expenditure review for the health sector and conduct annual internal review of government expenditure in the sector 1998-2001  
    Evaluate the sector's performance in drug costs recovery (1998) and reduce publicly funded allocations based on progress achieved (1999-2001) 1998-2000  
  Improve the effectiveness of community participation Develop in 1998 a draft legal framework for local community participation in the health sector; adopt and implement it in 1999-2000 to ensure administrative and financial autonomy 1998-2000  
K. Transportation
and urban
infrastructure
Improve condition of road network, along with efficiency and viability of construction and maintenance work Privatize public works equipment rental activities and establish the Road Maintenance Fund 1998  
Transfer road maintenance activities to the private sector 1999  
  Improve transportation conditions Complete restructuring of the national transportation company (SNTN) 1998  
    Liberalize maritime transportation and restructure the Nigerien Shippers' Council (CNUT) 1998  
    Privatize and demonopolize the joint transit management institution (OCBN) in consultation with the government of Benin 1998  
    Adopt severance package plan for personnel of the DMPT and DTP (social safety net) 1998  
  Improve access to basic urban services Adopt a strategy aimed at improving management of urban infrastructure development 1998  
    Conduct a study on developing simple tools for urban planning and implement its recommendations 1998-2000 World Bank
L. Mining sector Promote diversification of production and improve efficiency of existing activities Conduct strategic research in Air, Damagaram Mounio, and Sud Maradi to provide basic geological and mining information to the private sector 1998-2000  
    Compile and assemble research work on petroleum and mining 1998-99  
    Restructure uranium sector 1998-2001  
    Identify areas with good potential for oil prospecting 1998-2001  
M. Social safety net Reduce social costs of adjustment for most vulnerable groups Extend job creation program to rural areas 1998-2001  
    Implement measures aimed at ensuring food security 1998-2001  

 

Table 2. Niger: Social Indicators
    Latest single year
     Same region/
income group
    1970-75  1980-85  1990-96   Sub-
 Saharan
Africa
Low-
 income

POPULATION
Total population, mid-year (millions)   4.7 6.6 9.3   596.4 3,236.2
   Growth rate (% annual average)   2.5 3.5 3.3   2.7 1.8
Urban population (% of population)   10.6 14.3 18.7   31.7 29.1
Total fertility rate (births per woman)   7.2 7.4 7.4   5.6 3.2
 
POVERTY
(% of population)              
National headcount index   .. .. 63.0   .. ..
   Urban headcount index   .. .. ..   .. ..
   Rural headcount index   .. .. ..   .. ..
 
INCOME
GNP per capita (US$)   250 220 200   490 490
Consumer price index (1987=100)   39 111 131   266 275
Food price index (1987=100)   .. 120 83   .. ..
 
INCOME/CONSUMPTION
DISTRIBUTION
               
Share of income or consumption              
(% of income or consumption)              
Lowest quintile   .. .. 7.5   .. ..
Highest quintile   .. .. 44.1   .. ..
 
SOCIAL INDICATORS
 
Public expenditure
 
   Health (% of GDP)   .. .. 1.6   .. 1.5
   Education (% of GNP)   .. 3.1 3.1   5.3 3.6
   Social security and welfare (% of GDP)   .. 0.3 ..   .. ..
 
Net primary school enrollment rate
(% of age group)
   Total   .. 25 25   .. ..
      Male   .. 32 32   .. ..
      Female   .. 17 18   .. ..
 
Access to safe water
(% of population)
   Total   27 37 53   45 76
      Urban   36 48 46   63 80
      Rural   26 34 55   34 72
 
Immunization rate
(% under 12 months)
   Measles   .. 19 38   56 80
   DPT   .. 6 19   55 81
Child malnutrition (% under 5 years)   .. 49 43   .. ..
 
Life expectancy at birth
(years)
   Total   39 40 47   52 63
      Male   38 39 44   51 62
      Female   41 42 49   54 64
 
Mortality
   Infant (per thousand live births)   166 139 118   91 68
   Under 5 (per thousand live births)   .. 300 321   147 94
   Adult (15-59)
      Male (per 1,000 population)   611 562 510   448 231
      Female (per 1,000 population)   490 453 401   376 206
   Maternal (per 100,000 live births)   .. 519 593   .. ..
 

Source: World Development Indicators 1998 CD-ROM, World Bank
 

Table 3. Selected Economic and Financial Indicators, 1995-2001
  1995   1996
   1997
  1998 1999 2000 2001
    Prog. Est.   Prog. Est.   Proj.

  (Annual percentage change, unless otherwise specified)
National income and prices
   GDP at constant prices 2.6   3.6 3.3   4.5 3.4   4.4 4.5 4.5 4.5
   GDP deflator 5.4   3.0 4.8   3.0 3.0   3.0 3.0 3.0 3.0
   Consumer price index
      Annual average 10.9   4.7 5.3   3.0 2.9   4.8 ... ... ...
      End of period 5.5   3.0 3.6   3.0 4.1   3.4 2.9 2.9 2.9
 
External sector
   Exports, f.o.b. (in CFA francs) 11.4   3.7 7.9   10.7 1.9   6.5 0.7 3.8 4.1
   Imports, f.o.b. (in CFA francs) 1.7   16.0 5.5   26.6 10.4   4.6 6.2 3.9 4.9
   Export volume 6.1   2.5 -11.2   4.8 10.2   4.1 -2.9 1.5 1.5
   Import volume 2.9   10.5 1.6   11.5 1.6   2.7 4.9 2.3 3.6
   Terms of trade (deterioration -) 8.9   -3.6 17.0   -7.0 -15.0   0.4 2.4 0.6 1.1
   Nominal effective exchange rate
      (period average; depreciation -) 2.1   ... 0.4   ... -1.4   ... ... ... ...
   Real effective exchange rate
      (period average; depreciation -) 10.9   ... 3.3   ... -3.0   ... ... ... ...
 
Government finances
   Total revenue 30.1   21.6 16.3   29.3 14.9   27.5 12.0 18.1 12.3
   Total expenditure and net lending1 -11.3   6.7 -8.2   48.0 28.7   19.1 2.5 8.0 6.9
      Current budgetary expenditure -10.6   -18.8 -14.1   24.4 30.4   9.5 -5.4 6.5 6.9
      Capital expenditure -11.4   49.1 -7.2   91.0 32.8   17.5 12.5 11.3 7.1
 
Money and credit
   Domestic credit 5.4   13.5 3.0   8.7 7.4   11.6 1.1 ... ...
      Credit to the government (net)2 8.1   11.2 2.0   3.1 6.3   6.8 -5.5 ... ...
      Credit to the economy -7.9   7.2 3.2   16.2 3.1   13.1 17.2 0.0 0.0
   Net domestic assets2 4.4   9.5 -0.6   7.8 6.7   12.7 1.1 ... ...
   Money and quasi money 3.8   9.5 -6.6   8.6 -3.0   9.0 8.3 ... ...
   Interest rate (end of period; in percent)
      Minimum rate, savings deposits 4.5   ... 3.5   ... 3.5   ... ... ... ...
 
  (In percent of GDP, unless otherwise specified)
 
Budgetary revenue 7.2   8.1 7.8   9.3 8.4   9.9 10.3 11.3 11.8
Current expenditure 10.7   8.7 8.5   10.5 10.4   10.6 9.3 9.2 9.1
Capital expenditure 4.7   6.6 4.1   7.2 5.1   5.5 5.8 6.0 5.9
Total expenditure 15.2   16.1 12.9   18.5 15.6   17.3 16.4 16.5 16.4
Primary budget balance
   Commitment basis -1.2   0.0 0.0   -0.7 -1.4   -0.6 0.7 1.3 1.7
Current budget balance (excluding grants)
   Commitment basis -3.2   -0.6 -1.3   -1.1 -2.4   0.0 0.7 1.8 2.3
Overall balance (excluding grants)
   Commitment basis -8.0   -8.0 -7.4   -9.1 -7.5   -7.3 -6.1 -5.2 -4.6
Overall balance (including grants)
   Commitment basis -3.9   -4.1 -0.4   -3.8 -2.9   -3.7 -3.2 -2.3 -1.7
 
Gross domestic investment 7.5   12.5 9.7   13.2 10.8   11.4 11.9 13.0 14.1
   Private 2.1   5.1 5.0   5.0 5.0   5.1 5.3 6.2 7.4
   Public 5.4   7.5 4.6   8.2 5.8   6.3 6.6 6.8 6.8
Gross national savings 2.8   6.5 6.3   8.6 6.8   6.8 6.7 9.0 10.4
Gross domestic savings 0.4   5.0 3.1   4.7 3.3   4.5 4.6 6.0 7.4
   Private 1.4   2.9 2.0   3.0 2.9   1.9 1.4 1.9 2.7
   Public -1.0   2.1 1.1   1.7 0.3   2.6 3.2 4.1 4.7
Resource gap 7.1   7.6 6.5   8.3 7.5   6.9 7.3 6.9 6.8
 
External current account balance
   Including official transfers -4.7   -6.0 -3.3   -4.4 -4.0   -4.6 -5.2 -3.9 -3.7
   Excluding official transfers -11.1   -11.4 -9.2   -11.1 -10.1   -9.4 -9.2 -7.9 -7.5
External public debt (end of period)3 4 75.0   69.3 66.0   62.3 61.0   61.0 59.0 56.0 52.0
 
Debt-service ratio in percent of:
   Exports of goods and nonfactor services    
      Before debt relief 32.3   28.2 23.8   24.4 24.6   27.4 26.0 26.2 25.6
   Government revenue
      Before debt relief 76.6   50.8 51.9   41.2 55.2   50.5 43.5 38.4 34.8
 
  (In billions of CFA francs)
 
GDP at current market prices 938.7    1,011.1   1,016.8   1,095.2   1,082.9    1,164.4    1,253.8    1,348.9    1,452.1
Government payments arrears
   (reduction -)
16.6   -94.7 -36.5   -60.2 -11.9   -34.3 -22.3 0.0 0.0
       Domestic -12.4   -36.1 -18.0   -19.4 -13.8   -13.8 0.0 0.0 0.0
       External 29.0   -58.6 -18.5   -40.8 1.9   -20.5 -22.3 0.0 -9.1
Overall balance of payments4 -29.8   -75.7 -33.7   -19.0 -30.4   -50.3 -49.7 -39.7 -37.7

1Commitment basis as per payment orders issued.
2In percent of beginning-of-period money stock.
3Including obligations to IMF
4Before debt relief
 

Table 4. Niger: External Financing Requirements, 1995-2001
(In billion of CFA francs)
  1995 1996 1997
Est.
1998 1999 2000 2001

Requirements  100.4  130.6  126.8  166.8  175.8  138.9  137.1
   Current account deficit, excluding              
       interest and official transfers 82.7 77.9 93.1 91.8 97.6 89.4 91.7
   Interest 21.1 15.9 15.9 17.8 18.1 16.8 17.2
   Debt amortization 24.8 19.1 18.5 25.6 28.2 34.4 35.1
   IMF repurchases and repayments 6.1 6 8.7 8.3 3.5 1.1 0.8
   Changes in external payments              
       arrears (increase -) -27.1 18.4 -1.9 20.5 22.3 9.1 0.0
   Changes in net foreign assets              
       (increase-)1 -6.2 -6.9 -5.4 2.8 6 -11.9 -7.7
               
   Net counterpart to revaluation -1.0 0.3 -2.2 0.0 0.0 0.0 0.0
               
Resources 100.4 130.6 126.7 113.7 101.3 100.9 108.3
               
   Official transfers (gross) 59.8 59.9 65.7 56.3 50.4 53.1 54.5
   Long-term public loan              
       disbursements (gross)2 17.4 16.0 42.1 28.8 29.3 30.8 32.3
   Short-term capital (net)3 21.6 3.3 -10.7 -0.1 14.5 17.0 19.5
   Debt rescheduling 1.6 44.3 14.1 13.1 7.1 0.0 1.0
   Use of IMF resources 0.0 7.2 15.5 15.6 0.0 0.0 0.0
   Other exceptional financing 0.0 0.0 0.0 0.0 0.0 0.0 1.0
               
Remaining financing gap 0.0 0.0 0.0 53.2 74.5 38.0 28.8
               
Memorandum item:              
               
   Exchange rate (CFAF per SDR) 757 743 802 807 794 791 790

Sources: Nigerien authorities; and Fund staff estimates and projections.
1Excluding the net position vis-à-vis the Fund.
2Includes both existing and expected new commitments.
3Includes errors and omissions.
TABLE OF CONTENTS