Trade in Niger

man in boat
A developing country, Niger consistently has one of the lowest ranks of the United Nations’ Human Development Index, 186th of 187 countries in 2011. Much of the non-desert portions of the country are threatened by periodic drought and desertification. The economy is concentrated around subsistence and some export agriculture clustered in the more fertile south, and the export of raw materials, especially uranium ore. Niger remains handicapped by its landlocked position, desert terrain, poor education and poverty of its people, lack of infrastructure, poor health care, and environmental degradation.

The country’s predominantly Islamic population of just above 15,000,000 is mostly clustered in the far south and west of the nation. The capital city is Niamey, located in the far southwest corner of Niger. Niger had an estimated nominal GDP of $6.286 billion in 2011 and a GDP per capita of $417, according to the World Bank. Uranium is Niger’s largest export. Foreign exchange earnings from livestock, although difficult to quantify, are second. Actual exports far exceed official statistics, which often fail to detect large herds of animals informally crossing into Nigeria. Substantial deposits of phosphates, coal, iron, limestone, and gypsum also have been found in Niger. The 50% devaluation of the West African CFA franc in January 1994 boosted exports of livestock, cowpeas, onions, and the products of Niger’s small cotton industry. Exports of cattle to neighboring Nigeria, as well as Groundnuts and their oil remain the primary non-mineral exports.

In recent years, the Government of Niger promulgated revisions to the investment code (1997 and 2000), petroleum code (1992), and mining code (1993), all with attractive terms for investors. The present government actively seeks foreign private investment and considers it key to restoring economic growth and development. With the assistance of the United Nations Development Programme, it has undertaken a concerted effort to revitalize the private sector. In addition to changes in the budgetary process and public finances, the new government has pursued economic restructuring towards the IMF promoted privatization model. This has included the privatization of water distribution and telecommunications and the removal of price protections for petroleum products, allowing prices to be set by world market prices. Further privatizations of public enterprises are in the works. In its effort comply with the IMF’s Poverty Reduction and Growth Facility plan, the government also is taking actions to reduce corruption and, as the result of a participatory process encompassing civil society, has devised a Poverty Reduction Strategy Plan that focuses on improving health, primary education, rural infrastructure, and judicial restructuring.

Overall, Niger is still quite a poor market to invest or do trade in. It was ranked 173rd in the annual World Bank survey of Easiest Countries to do Business In, for the year 2012. The economy of Niger grew by approximately 3% for the year 2011, which is quite low considering the limited base that the economy has to grow from. It remains to be seen whether the government program will have an effect in terms of producing the economic growth necessary to the economy of Niger moving, but until that is the case, this market is quite limited.

-Jay Zadey

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