Niger: Risk Assessment

Country Risk Rating

C A very uncertain political and economic outlook and a business environment with many troublesome weaknesses can have a significant impact on corporate payment behavior. Corporate default probability is high.

Business Climate Rating

D The business environment is very difficult. Corporate financial information is rarely available and when available usually unreliable. The legal system makes debt collection very unpredictable. The institutional framework has very serious weaknesses. Intercompany transactions can thus be very difficult to manage in the highly risky environments rated D.


  • World's fourth-largest producer of uranium
  • Net exporter of oil products since 2012
  • Effort to invest in agriculture and infrastructure
  • Debt relief under the HIPC and MDRI initiatives


  • Economy vulnerable to climate events and fluctuations in raw materials prices
  • Land-locked
  • Rapid population growth and extreme poverty
  • Deteriorating security situation

Current Trends

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Growth outlook remains favorable despite worsening in the security situation and weakness of the uranium market

The decline in agricultural output, following the strong performance recorded in 2014, as well as the fall in prices and production in the mining and oil sectors are behind the slowing of growth in 2015. On the other hand, services (retail, transport and communications) have demonstrated a degree of dynamism. The medium term economic outlook remains favorable in the light of efforts to increase agricultural production in the context of the 3N initiative (“Les Nigériens nourrissent les Nigériens”), the expected boost to oil refining capacities and the continuation of major infrastructure projects (highway junctions, rail links, cement works, dam, power stations, oil pipeline).

Uranium mining, the main source of foreign currency, has been in decline in recent years following the Fukushima disaster in 2011 and the jihadist attacks in 2013 against an Areva site. In addition, the huge mining project at Imouraren, which should turn Niger into the world’s second biggest producer of uranium, has been mothballed because of the slump in international market conditions.

Despite its resources, and even though certain social indicators have improved, Niger remains one of the poorest countries in the world. It comes in at the bottom of the list in terms of human development index and 44% of its population lives below the poverty line (1.25 dollar a day). Its high birth-rate is exacerbating the problem of unemployment among young people. On top of this, the country’s economy continues to be overly dependent on subsistence farming, with inadequate infrastructures and weak institutions. The business climate has improved slightly (approval of a new investment code, reduction in the minimum capital required to start a business, quicker access to water, and improved credit information system) but remains problematic. Finally, the country has to deal with persisting pockets of insecurity along its southern and northern borders. Inflation, driven in large part by movements in food prices, remains below the WAEMU Community rate, set at 3%.

Significantly deeper public and current account deficits

The budget situation has worsened significantly, linked with increased spending on security and humanitarian aid (associated with the advances of the Boko Haram group on the border with Nigeria and the influx of refugees) and spending on capital goods (linked with the implementation of structural public projects). The public debt stock was significantly reduced in 2004 and 2006 thanks to sizable debt relief. This outstanding has tended however to increase rapidly since 2011 because of the involvement of the State in investment projects in the mining sector and the construction of infrastructure projects. In the medium term, the increase in State revenue due to the entry into operation of the oil pipeline and the start-up of the Imouraren mine project should, however, make it possible to stabilize the debt.

Exports are dependent on movements in world prices, consisting mainly of commodities, including uranium and oil, which, on their own, account for between 50% and 60% of export sales, depending on the year. The current account deficit is getting larger, a reflection both of the decline in international prices and the rapid growth in imports associated with major infrastructure projects. On top of the trade deficit, there is also the significant deficit in the balance of services, arising from the high cost of transport and imported services linked with mining activities. The country is however in receipt of a relatively large inflow of foreign direct investment (mainly Chinese and French) and project loans. It has however requested an extension from the IMF, until the end of 2016, to its Extended Credit Facility.

A deterioration in the security situation

President Mahamadou Issoufou and his party, the Nigerien Party for Democracy and Socialism, are expected to win the upcoming presidential and parliamentary elections scheduled to be held between February and March 2016, given the dissensions within the opposition. The arrest of one of its leaders, for child trafficking, in November 2015, could however tarnish the credibility of the presidential election. The main risk arises from the security situation, which worsened in 2015 with increased attacks by Boko-Haram in Nigeria and its incursions into southeast Niger, resulting in an influx of refugees and population displacements, disrupting cross-border trade and putting a strain on the budget. In response to this, Niger reinforced its military presence in the south of the country and joined the regional military force, which also includes Benin, Chad, Cameroon and Nigeria. The country has already had to host, in recent years, refugees from Mali and repatriates from Libya and also has to guard its northern border.


Coface (09/2016)