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Niger Economic Outlook and Opportunity

Niger Economic Outlook and Opportunity. First UK/USA- Niger Investment Forum 2012 London, June 14, 2012 Nestor Coffi , World Bank Country Manager Niger. Overview. Country Context Growth Perspectives Opportunities Challenges Conclusion. Country Context.

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Niger Economic Outlook and Opportunity

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  1. NigerEconomic Outlook and Opportunity First UK/USA- Niger Investment Forum 2012 London, June 14, 2012 Nestor Coffi, World Bank Country Manager Niger

  2. Overview • Country Context • Growth Perspectives • Opportunities • Challenges • Conclusion

  3. Country Context • Restored vibrant democracy - oasis in the Sahel • Huge development ambitions under Renaissance Plan being translated under a comprehensive Plan for Economic and Social Development • Demonstrated resilience: maintained strong macroeconomic stability despite the recurrent external shocks • Collaboration with regional and international partners to deal with security risks arising from conflict in Mali, Libya, and Nigeria

  4. Country ContextCountry Policy and Institutional Assessment

  5. Country ContextCountry Policy and Institutional Assessment • Bank’s Annual Country Policy and Institutional Assessment shows continuous improvement in recent years • Most progress was made on establishing sound economic management and more recently on improved policies for social inclusion and equity. • Less progress was seen with respect to structural policies and public sector management and institutions • These areas are now the focus of reforms with support by the World Bank

  6. Country Context – Doing Business in Niger How far has Niger come in the areas measured by Doing Business? Distance to frontier, 2005 and 2011

  7. Country Context – Doing Business in Niger

  8. Country Context – Doing Business in Niger • Niger ranks low (173) on the World Bank’s Doing Business Ranking • Important to put into perspective – much of the poor rankings are due to relative high cost of procedures in relation to Niger’s extremely low per capita income (but not in absolute terms) • Niger has moved closer to the frontier in a number of areas, including starting a business, dealing with construction permits, getting credit, and resolving insolvency

  9. Country Context – Governance Indicators

  10. Country Context – Governance Indicators • The World Bank’s governance indicators are an aggregate drawing on a variety of different assessments • Over the past ten year’s, Niger has made significant progress in enhancing government effectiveness, the regulatory quality, rule of law, and control of corruption • Voice and accountability and political stability and absence of violence have seen a deterioration. But the new authorities have initiated corrective action (such as vastly improved press freedom) • Actions of new government not yet reflected in this assessment, but could lead to significant improvement if sustained.

  11. Growth Perspectives • Following the mining boom in the 1970’s Niger suffered two decades of stagnation and decline during the 80’s and 90’s • Macro-economic stabilization and a broad range of reforms launched in the early 2000’s have supported the modes relaunch of economic growth, averaging close to 5 percent during the past decade • A sustaining and deepening of structural reforms can provide the basis for a growth acceleration to catch up to regional economies • Petrol and uranium industries will be key drivers of economic growth over the next three to five years • To sustain growth momentum, private sector led diversification of the economy is critical

  12. Opportunities • Private sector is underdevelopped and productivity is low, with tremendous potential to catch up to neighboring countries through increased trade, foreign direct investment, and skills development • Government’s ambitious program for investment and reform with a strong focus on inclusive growth would provide the foundation for this. • Initial reforms to strengthen private –public dialogue and cooperation are promising, including the relaunch of the National Private Investors Council and the development of a PPP framework • Regional integration within the WAEMU, trade with Nigeria, and stabilization and development in Arab countries provides significant opportunities for Niger • Niger joined MIGA – opportunities to provide coverage against political risks

  13. Opportunities – Extractive Industries • World Bank is supporting government’s efforts to strengthen the policy and institutional regime for the sector • Significant potential for further discoveries in and beyond uranium and oil – • Significant potential for the development of mining and oil sector related activities

  14. Opportunities Agriculture and Livestock • Niger is a major producer of livestock, but currently there is little value added and most exports are on hoof to Nigeria • World Bank supported rehabilitation and expansion of abattoirs and improved sector policies will create new opportunities for growth in the sector • Niger produces several high quality agricultural niche products, including onion, gum arabica, sesame, tiger nuts, and cow peas • The Word Bank supports improvements in the value chain of these products to foster exports

  15. Opportunities – Infrastructure Development • Power sector – Kandadji Hydro-project is underway with financing from government, the Bank, and a group of other development agencies and financiers • Expansion and improved maintenance of road infrastructure remains a priority of government with support from Bank and other donors • Mobile telephone system has expanded significantly in recent year with several operators, but with considerable scope for further expansion • A railway connection to Benin and Burkina is under consideration • Newly adopted regulatory and institutional regime for PPPs provides a strong basis for private sector involvement

  16. Challenges • Improving governance – Bank is supporting public financial management reforms, development of an anti-corruption strategy, procurement reforms • Improving the Business Environment – Bank and IFC are providing support for the development of an action plan to improve the business environment and support the implementation of key reforms (tax administration, investment code, export and import regime, etc) • Strengthening Infrastructure – investment support to power, road, and water development combined with support for reforms to ensure greater efficiency • Building Human Resources – a project to strengthen the development of skills for economic growth is under preparation, focused on strengthening the link between technical and vocational education and training and the private sector

  17. Conclusion • Niger offers significant opportunities for investment and trade • World Bank is committed to support ambitious government agenda through the combination of knowledge – partnership – financing • Comprehensive support by members of the World Bank Group: IDA, IFC, MIGA • Priorities for next three years to be defined in consultation with Government and local and international stakeholders • Fostering of partnerships with government, private sector, civil society, and other development is critical for positive impact of World Bank support

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