Niger is weathering a fall in the price of its key exports and remains on track to grow by an average of 5.6 per cent over the next two years, the International Monetary Fund’s resident representative said on Wednesday.
Uranium and refined oil accounted for roughly two-thirds of Niger’s exports in 2013. While volatile oil prices can make revenues uncertain, the price of uranium — which makes up 40 percent of exports — is contractually determined annually and lags international markets.
“The negative impact of the fall of commodities prices has, so far, been manageable,” the IMF’s Ahmed Zorome told Reuters. “Overall, the medium-term outlook remains favourable and growth is expected to average 5.6 percent in 2014-2016.”
Niger’s $8 billion economy probably grew by around 6.5 per cent last year, accelerating from 4.1 per cent in 2013, driven by agriculture and government infrastructure projects, the Fund said in December.
Zorome said there was no evidence that spending on security was jeopardizing the budgetary balance. Niger posted a budget deficit of 2.7 per cent of GDP in 2013.
Niger is taking part in a regional operation against Islamist militant group Boko Haram in northern Nigeria, as well as stepping up security in its own north against traffickers and jihadi groups operating across the border in neighbouring Libya.
“However, security-related outlays are frustrating the government’s development programmes, as scarce resources which could have been directed to infrastructure building and poverty reduction are diverted,” he added.
Efforts to combat widespread poverty by the government of President Mahamadou Issoufou, who is expected to seek re-election in mid-2016, were also being hindered by fluctuations in donor support, rapid population growth and climate shocks.
Niger’s population is growing at around 3.9 percent a year, one of the fastest rates in the world, restraining growth in income per capita. Niger ranked bottom of the U.N. Human Development Index for 2013.
“To improve food security, the government needs to give priority to irrigated farming projects … and improve the access to local harvests,” Zorome said.
Niger has made progress in reforming the business environment and improving its debt management in the context of its Extended Credit Facility with the IMF, the multilateral lender noted in a recent report.