AGRICULTURAL PRODUCTION Z 0 AU-Weather Roods

Report No. 487a-NIR Current Econormic Position and Development P'rospects of Niger FILE COPY

Public Disclosure Authorized (In Three Volumes) Volume 1: Main Report August 20, 1974 Western Africa Regional Office Not for Pu'blic Use Public Disclosure Authorized Public Disclosure Authorized

Document of4'he International Bank fDr Reconstruction and Development International Development Association Public Disclosure Authorized

L - 1 This report was prepared for official use only by the Bank Group. It may not be published, quoted or cited without Bank Gl'oup authorization. The Bank Group does not accept responsibility for the accuracy or cDmpleteness of the report. CURRENCY EQUIVALENTS

Before 1969: US$1.00 = CF'AF 247 1969-1971: US$1.00 = CFAF 278 1972: US$1.00 = CFAF 252 1973: US$1.00 = CFAF 222 1974 and after: US$1.00 = CFAF 250

WEIGHTS AND MEASURES (Metric System)

1 hectare (ha) = 2.469 acres 1 kilometer (km) = 0.6215 miles 1 kilogram (kg) = 2.2047 pounds 1 ton (t) = 1.1023 short tons = 0.9842 long tons 1 liter (1) = 1.057 US quarts

FISCAL YEAR

October 1 - September 30 CURRENT ECONOMIC POSITION

AND DEVELOPMENT PROSPECTS

OF NIGER

VOLUME I:. MAIN REPORT

VOLUME II:: THE AGRICULTURAL SECTOR (MAIN REPORT)

VOLUME III: THE AGRICULTURAL SECTOR (ANNEXES)

CURRENT ECONOMIC POSITION

AND DEVELOPMENT PROSPECTS

OF NIGER

VOLUME I

TABLE OF CONTENTS

Page No. Para.No.

LIST OF ABBREVIATIONS

COUNTRY DATA

MAPS

SUMMARY AND CONCLUSIONS ...... i

PART I - RECENT ECONOMIC DEVELOPMENT ...... 1

A - General ...... **0 ...... 1 1

Economic Growth ...... 1 1 Investment and Saving .. *...... *O..*.... 1 4 B-Ma-in Sectors ...... 0...... 3 5

Agriculture ...... 3 5 Mining ...... *. 8 18 Industry ...... 0...... 11 28 Transportation ...... 13 40 Education ...... 15 46

C - Financial Developments ...... 17 52

Balance of Payments ...... 0...... 17 52 Merchandise Exports ...... 19 55 Merchandise Imports ...... 21 61 External Debt ...... 23 65 Foreign Aid ...... 23 66 Public Finance ...... 27 73 The Monetary Sylstem ...... 31 82 Recent Monetary Developments ...... 34 88 Prices ...... *.#.o...... 34 90 TABLE OF CONTENTS (Continued)

Page No. Para.No.

PART II - DEVELOPMENT PROSPECTS ...... 36 93

A - The Short-Term Outlook - 1974 and 1975 ...... 36 97

General Outlook - Rural Incomes ...... 37 101 Budget ...... 39 106 Balance of Payments ...... h1 112

B - The Longer Term Outlook - Constraints ...... 43 119

Natural Constraints ...... 0 .. 43 119 Population Problems ...... 45 125 Economic Dependence ...... **...... *****... .***e 48 132

C - Government Development Policies ...... 49 138

D - Strategies and Prospects ...... 52 149

Development Objectives ...... 53 152 Stra.tegy for the Rural Sector ...... 53 155 Components of an Agricultural Program ...... 55 158 1. Rural Development Projects ...... * 57 162 2. Irrigation Program ...... 0...... 59 167 3. Livestock Policy ...... 62 175 Other Aspects of Agricultural Policy ...... 63 179 Other Sectoral Prospects and Overall.Growth ...... 65 183 Balance of Payments Outlook ...... 66 187 After the Next Decade *...... *...... 71 203 STATISTICAL APPENDIX

This report is based principally on the findings of a mission that visited Niger in October-November 1973 and was composed of L. de Azcarate (chief), P. Streng (economist), and R. Sordoillet (agricultural consultant). The report was discussed with the Government in April 1975. Because of the important political and economic changes that occurred since the report was written, it was decided to limit its distribution to the staff of the World Bank Group. LIST OF ABBREVIATIONS

ASECNA Agence pour la Securite de la Navigation Aerienne en Afrique et a Madag,ascar BCEAO Banque Centrale des Etats de l'Afrique de l'Ouest BDRN BOAD Banque Ouest Africaine de Developpement CCCE Caisse Ceintrale de Coopdration Economique (France) CEA CommissarLat ' l'Energie Atomique (France) CEAO Communautd Economique de l'Afrique de l'Ouest CFA Communautd Financiere Africaine CFDT Compagnie Fran,aise pour le Developpement des Fibres Textiles CNCA Caisse Nationale de Credit Agricole COMINAK Compagnie Miniere d'Akouta CSPPN Caisse de Stabilisation des Prix des Produits du Niger FAC Fonds d'Aide et de Cooperation (France) FED Fonds Europeen de Developpement FNI Fonds National d'Investissement NIGELEC I NITEX Societe Nigerienne des Textiles OCDN Organisation Commune Dahomey-Niger des Chemins de Fer et des Transports OLANI Office du Lait du Niger OPVN 1/ OURD Overseas Uranium Resource Development Corporation (Japan) SEPANI Societe d'Exploitation des Produits d'Arachide du Niger SHN Societe des Huileries du Niger SICONIGER Societe Industrielle et Commerciale du Niger SNC i/ SOMAIR Societe des Mines de l'Air SONICERAM / SONIFAME ! SOTRAMIL 1 UDEAO Union Dotianiere des Etats de l'Afrique de l'Ouest / UMOA Union MorLntaire Ouest Africaine UNCC Union Nigdrienne de Credit et de Coopdration

U/ Mixed enterprise listed in Table 10.6 of the Statistical Appendix. ?J Later transformed into the CEAO.

Page 1 or 3 pages

OOUNTRYDATA - NIGER

ARIA POPDLATrON DENSITY 1,267,000 kD 2 4i5 lnion (mid-1972)3 32 Ia Per Iceof rahie la nd

SOCIAL INDMCATORS

Reference Countries N1igar i sensel ** 9 197J O1970 1970 It70 GNP PER CAPIA (ATLASBASIS) 1 130 90 100 A 120 /b 260 /b

DEYGORAPHIC Crude birth rate (per thouaend) 52 /c 52 d 49 /dce 49 44 Crude death rate (per thouAnd) 27 7& 237w 241. 18 22 Infant sortality rate (per thousand live births) 200 Za 94 156 /f Lif expectancy at birth (years) 37 c 42 39 48 42

Oross reproduction ratea 3.1 3.5 3.2 3.4 3.0 Populetion growth rate , 3.0 2.9 32.621028I Population growth rate - urban 6/7 7 7 5 4

Age struoture (percent) 0-l4 44 41 /a 4524 /s 545 42 15-6k. 534 527;a 52N; 52 54. 65 and over 3 7I 37a 3 Dependency ratio A 1.6 1. 7;n 1.1 7n 1.0 /n 1.1 /n

llrban population as percent of total 6/h 8 /h 6 /i 12 /J 29 /k Family planning: No of acceptors cumulative (thous.) . -- No. of wers (t of married women)

EMPLOYMENT Tot=a labor force (thousands) 770 1,900 /a 2,000 I 7,40C /e 1,600 /eoq Percentage esployed in agriculture 97 917i 88 i 80 7 73 Percentage unemployed 7I

INCOMEDISTRIBUTION Percent of national income receired by highest 5% 23 Porcent of national income recei ed by highest 20% 42 Perc.nt of national income receired by lowest 20% 6 Percent of national income recei'ed by lowest 40% 18

IISTRIBUTION OF LAND OWNBESHIP %owned by top I0% of ow=ners %owned by awmllest 10% of owner., .. ..

HEALTd AND NUTRITION Population per physician 71,000 /r 58,260 75,250 /s 15,94C 14,940 Population per nursing person 7.500 70,r 7,040 16,090 7i 1,950 2,1410 Population per hospital bed 1,880 =t 2,230 640 - 1,040 /u 730 /u

Par capite calorie oupply as %O' requiremnts . 90 /V 98 85 is' 96 Is Per capita protein sumply, total (grams per day 66 78 7v 63 597; 64 7; Of which, animal and pulse 24 7; 9 24 Z: 28 7; Death rote 1-1. years /7

EDUCATION Adjusted /8 prinary school enrolment ratio 6 14 37 25 /a 44 /f Adjusted L secondary school enrOllment ratio 0.3 Is 1 3 9 Ea 7 7; Tears of schooling provided, firot and second level 13- 13 14 12 13 Vocational enrollment as S of sa,. school enrollment 4 /w 6Ls 3 1 /a 12 /a Adult literacy rate S . . 19 7; 10 7i

HDUSINO Average No. of persons per room (urban) 1.9 /a. 2.5 /ae Percent of occuPied units without piped water 78 7ah ~ 36 tab aa 26 ,A. Access to electricity (as S of total population) 16 7 Percent of tural poPulation conoc.ted to electricity O O

CONSUMPION Radio receivers per 1000 population 1 36 20 12 /f 69 Passenger cars per lOUO populaticn 0.6 A 1 2 2 11 Ilectric power consumption (kwh p. c.) 3 9 32 25 84 Newsprint consumption p.c. kg per year 0.03 /ao 0.04 0.2 0.06

Notess Figures refer either to the :tateat periods or to account of enviroumental temparture, body weightes, and the letest years. Latest periods re'er in principle to distribution by age and mox of ational populatios. the years 1956-60 or 1966-70j the la' est years in prin- / Protein standards (requirmnta) for all countries as estab- ciple to 1960 and 1970. lAshed by USDA Bconomio Research Service provide for a minimum A The Per Capita GNP aetimate is a1 oert prices for allowance of 60 grams of total protein per day, and 20 grass of yearo other than 1960,calculated by the eane conversion animal and pulse protein, of which 10 grama should be animal technique as the 1972 World Bank Atlas. protein. These standards are somewhat lower than those of 75 2 Average number of daughters per woman of reproductive grams of total protein and 23 grams of animal ,rotein as an age. average for the world, proposed by FAO in the Ihird World Food 4 Population growth rtes are for ' he decades ending in Survey. 1960 and 1970. 7 Sone studies have sugested that cude death rates of children A R atio of under 15 end 65 -ad ove, age breakets to ages 1 throug 4 may be used ase first approxioatien index of those in labor force bracket of sges 15 through 64. manutrition. 4 FAO reference standards represent pkhsiological re- Percentage enrolled of oorresponding population of school age quiremtene for moreal activity erd heelth tah,t _ as defined for mhob ocuntry.

* Recent Bank lusaioD estimate for mid-1972 is 4.21 .AlJm.

1 6 8 Ia 1969; /b 1972; /0 1959-60; /d 1965-70, uN estimate; /I Estimatej If 9 1 /g 1960-72; As Definition not avairble; - A11 twlohipe ud tn planing areas ad ; district ceonrs; /J Ety-dght towns ccap-Vert region ai the citiesl of Saint-Louis, Thies, Kaolack, Diourbel and Ziguinchor; A. Estimate for dejure

population, based on results rf aample survey; 4 1966; 4 Ratio of population undr 15 and 65 and over to total labor force; Lo Estimte hised on the results of a maple arvey and excludes labor force of 11aey city, nomad population ad foreigners; gi PAO esti1ate;6, 1970-71; /r 1962; 4 00verage of data incomplete; t 1963; ho GoverDent hoapital etabliahrants; v 196I 4 lNot inludizg private vocational schools; /x 1965; Public education only; / lNot inclu-g teacber Zrawt; / 19671; Urban only; / AL

Senegal has been selected as mn objective country aince its DNP is about three times that of Niger; both countries are in the same geographical area, have similar production patterns (with the same dominant crop -- groundnuts), share the sane monetary syatel. and have about the sane population.

h2 November 5, 1974

A.. amjc Page 2 of 3 pages

ECONOMIC INDICATORS

GROSS NATIONAL PRODUCT IN 1969 ANNUAL RATE OF GROWTH (%, constant prices)

FCFA Bln % 196 -6 196 - 19 GNP at Market Prices 103.0 100.0 Gross Domestic Investment 6.3 6.1 Gross National Saving 4.9 4.8 Current Account Balance - 1.4 - 1.4 Exports of Goods, NFS 10.6 10.3 Imports of Goods, NFS 17.2 16.7

OUTPUT, LABOR FORCE AND PRODUCTIVITY IN 1971

Value Added Labor Force V.A. per Worker FCFA Bln % Mln %_ FCFA Agriculture, Livestock, Fishing 51.95 47.6 Manufacturing 11.92 10.9 Construction 3.07 2.8 Services 40.15 36.8 Public Administration ('8.24) ( 7.6) Other 2.03 1.9 Total/Average 109.12 100.0 .

GOVERNMENT FINANCE Central Government FCFA Bln % of GDP 1971/72 1971/72 Current Receipts 12.13 Current Expenditure 11.24 Current Surplus 0.89 Capital Expenditures 2.45 External Assistance 1.33

MONEY, CREDIT AND PRICES (IFS) i/ 1965 1969 1970 1971 1972 1973 1974 (Million FCFA outstanding end period) Money and Quasi-Money 6,722 9,212 9,596 12,135 12,896 15,504 20,315 Bank Credit to Public Sector (net) -1,046 - 396 -1,652 -2,324 -3,458 _3,402 -7,152 Bank Credit to Private Sector 8,644 10,064 10,047 9,738 10,677 12,464 20,973 Money and Quasi-Money as % of GDP .. 9.4 9.4 11.1 General Price Index (1964 - 100) 2/ 104.0 125.0 125.9 131.2 144.0 160.9 166.3 Annual percentage changes in: General Price Index --- 4.7 --- 0.7 4.2 9.8 11.7 3.4 Bank Credit to Public Sector Bank Credit to Private Sector --- 3.9 --- -0.2 -3.1 9.6 16.7 68.3

1/ Data are not strictly comparable with those shown in the Statistical Appendix. 2/ Consumer 'price index, Niamey. Page 3 of 3 pages

TRADE PAYMENTS AND CAPITAL FLOWS

BALANCE OF PAYMENTS MERCHANDISE EXPORTS (AVERAGE 1970-72)

1970 1971 1972 FCFA Mln f (Million FCFA) Exports of Goods, NFS 16,802 2.8,141 20,640 Groundnut Products 5,504 49.8 Imports of Goods, NFS 25,873 24 268 26 272 Live Animals 1,958 17.7 Resource of Gap -9,071 f7-,62 Uranium Concentrates 1,449 13.1 Factor Payments (net) - 208 - 218 - 218 Cotton 305 2.8 Private Transfers (net) l 48 - 50 Hides and Skins 245 2.2 Current Balance -9,231 -6,345 -5,800 Onions 233 2.1 Direct Investment and Beans 149 1.3 Other Private Long-Term Other 1,216 11.D Capital (net) 5,193 2,960 1,120 Total Recorded Exports 11,059 loO.0 85.9 Inflow (5,704) (3,171) (1,330) Unrecorded Exports (est.) 1 822 14.1 Outflow (- 511) (- 211) (- 210) Total Merchandise Exports 1MT 100.0 Official Transfers (net) 7,725 7,430 8,700 Government Capital (net) 691 - 84 437 EXTERNAL DEBT, DECEMBER 31, 1973 Inflow (1,050) ( 726) (1,304) US$ Mln Outflow (- 359) (-810) (- 867) Public Debt incl. Guaranteed 116.7 Other Items (ret) -1 815 377 -2,187 G Change in Reserves 2,5 6 733 2,270 DEBT SERVICE RATIO for 1972

Gross Reserves (end year) 5,561 9,791 12,113 Central Bank (5,200) (8,592) (10,558) Public Debt, incl. Guaranteed 2.9 / Net Reserves (end year)-/ 3,275 7,613 9,883 Central Bank (5,081) (8,580) (10,553) IDA LENDING, DECEMBER 31 , 1974 US$ Mln Petroleum Products Otani and Disbusbre 15-85 Imports - FICFA million 603 1,183 1,392 OUtsadigandisbursed79 - US$ million 2.2 4.3 5.4 Ottnig Undisbursednl 73.96 - 1,000 tons 51.0 56.9 60.3 Outstanding, i. Undisbursed 23.81 / Exports - - -

RATE OF EXCHANGE

Through November 1971 US$1.00 - ECFA 277.71 December 1971 through January 1973 US$1.00 - FCFA 255.79 Since February 1973 US$1.00 - FCFA 230.10

FF 1.00 - FCFA 50.0

j Including US$45.3 million undisbursed. / Ratio of external debt service (US$2.3 million) to exports of goods and non-factor services as shown in the balance of payments. Including medium- and long-term foreign liabilities of development banks. g Original principal amount (US$22.1) million) plus adjustment to reflect the devaluation of the United States dollar (US$1.71 million).

not available not applicable

December 1974

Internatronol Merid,on I I I I

° 4- oREPUBLIC OF NIGER R-"12--. L I B Y A 16 Roads_____ ADMINISTRATIVE …- Deportment boundaries ...... District boundaries 22' * National capital 22- * Deportment seat * District seat o Adminstrative center

100 200 300 9/ I II I I I I ' Kilometers o 50 loo 150 200 1 I Ml l I Pi/,? N

NArli o iterouone (

J1It 18

M A L IM ~~~~~~ ~~~\ j~~~n Goll inAl Aadez ----. ------..

Ich-Tain rode(,e

It.

''I nl,ou ~ I ak

*, 14 -

_~~~~~~~~~ U PPE R

VOLTA? *Goyo 77, mrr'rrmrJ;,N I G E R IA

/'DAHOMEYa*p;zrr~~~~~~~~~~r'hr ,rW!rc,I'ncrr'rrr 12~~ 16' .,

REPUBLIC OF NIGER I-,. 1- POPULATION DENSITY

o''''~ *

*One dot equals 3000 inhabitants * *

* - J Iferouane r - ARLIT *BILMA 17~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~.0

M A L I \ * f-

j\\AGADEZ ., * In Gall * / The boundaries shown on this map do not . imply endorsement or acceptance by the * T i lii a * '*- World Bank and its affiliates. * * * | 0* TCHIN-ABARADENE *

Abalak N'Gourti

, Bani-Ban gottAaa* \ * -. * I . .. . (-YataJcealra * * a'A1%YLTI10" - tTANOtLTI OL 0 . * * .;y'#K9R(, ' 0 .1 *.XAjL a re *.?FILIN*.e .Dh6gRE&%:0 **GU*IG N

-fjt C~ ,.,! O O * ~6 * alGOUREA' o ¶r~~~~J~~ Ali 1 a. *- . e**t43 1J'E 0 ** * iv*r >5*4 50 o 50 Goa 2 N IRI A . * 0 It L-'*t0G0ND0UTCHIgt ir.;OURE Madarou 4 OS- 6\,1.. -| ,, . . *-* *

O D A H Os M E MAI N E_-S -< V ~~~~~~~~~~~~~~~~Miles

'0 ~ ~~~DA H 0M E Y - _ _ _ _ _ - _ _ _ _ _ b4

REPUBLIC OF NIGER AGRICULTURAL PRODUCTION z 0 AU-weather roods

All-weather tracks

Tracks without regular maintenance aDjodo\

Roinfoll lines (mm per year) C Millet

_-.. Groundrtuts °-0 (3) Contrt f

4 Sorghum /~ 1 Niebe Beans NLC -Northern limit of crops /a

/ej .~\ O \a 2. c c

VOLTh( iv>AjRICA 800GoaT~ I G R A00

'N' ~ ~ ~ ~ '~o

______j ~~ ~ ~ ~ ~ ~ ~ ~ ~~ ~~~ . o~~~~15 )

M A H 0I ~ 0 10 5 0 0C h'lonoksJono hsnwd W

Ati~ ~~~ Wrd&kad f ftncs r/ -1-

UP E 7 -taflac IoAN Moalaz [Mrll4'S;n /o

REPUBLIC OF NIGER N I G E R OUTLETS TO THE SEA

j A n~~~~~~~~~~~~~~~~~~TAHOUA TSATBNOKUTF SAOKAFI

M A L I BIRNI N'KONNI

' s._) ) ~~~~~~~~~~~~~~NAMEY TESSAOUA KIEANDER

U P PE R V 0 L T A A

.2 0 JDAHOMEY.) \k

(~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ I V O R Y I PARAKDI1 C O A S T t j ¢TGqN G E R i A

\ v G H A N A jj392

G U L F OF G U / NLEA

7The bourlaldes shb- nr dth map do wtl ampl -dorsemenw or .-eptrac by the WodldBask o,d It, ffihotexby 4e cv --d Roads 50 2500ml Ro0ods

50 0 SO 150 250 M -c 2I0 SOO 350KM Internot,onal boundares

IBRD3S33RI OCTOBER 1974' MALI REPUBLIC OF NIGER

< OXTohouo go Tanout

cAKabonkof,

t Blrns ~~~~~~~~~~~~~~~~43\

101 Malbozo

619~~~~~~~~~~~~~~~~~~~~~~~1 I..~~~~~~~~~~~~~~~~~~~~~~~~~~01057 Dosso 438 /

UPPER VOLTA\ G ; Molanvlle : n

753

.5/ 43 / e1an Ai

LDAHOMEY ) N

( f/ /' *,i' 1Ililil ~~~~~~~~Railway

438 Prokou Road

l OT G O;I D ESTANCESTO438 Distance by railway * i. !) .9/ SEAPORT 315 Distance by road 753 Total distance to seaport

O 100 200 300

Kilometers

0 50 100 150 200

Miles

ATZANTIC OCEAN

REPUBLIC OF Nl(,ER \.

TRANSPORTATION ROUTES , T, d- h..,, tho,.po:... don

FOR GROUNDNUT EXPORTS Woeld

40 8° L I BYAA NIGER_ NIGER RAINFALL,GEOGRAPHICAL AREAS AND \ / 2 ) bR 7MAIN ROUTES IN THE 0 k . \ 22 ) ( -22° PASTORAL ZONE

\, tJ 6,? 0 50 100 150 200 KILOMETERS - 0 50 100 ISO 200

MILES To Tanan f. oos 9 0. I~~~~~~~~~~~~~~~~FortLhprtOV ~ andGhardafa - , . -,. . - 1 STUDY AREA (FAC-SEDES) _,K:-; ,,>a"*

i Z20 _ YtI.V* ~LtSe - --i -. -5> -- - svGe7 g

l F 0215.3 RAINFALL STATION J t~~~~~NORMAL RAINFALL IN MM) §, ,--5,_,,, S 'mBlc TRACK (FOR MOTOR VEHICLES) A8oK 21r

x > TRACKS -7Bz-L.---.-:=INORMALRAINFALLINMMI o-eA ~~~CAMEL | I T A 'L K E3(50~~~~~N g o IA1NFE.g m ofB Im°8- -18° .+ . SE AiONrAL FLOOCW ,, , , E f RI ER | r N

-. X- I'TERiNT-ONAjL BOUNCO4IES .

23,;~ Goo

|JV. IO L T A i> < \ , I -. 4 4 '000.- a d t n W tTan.:.uv ~ - 3'- _.-

oo0 J> DAHOMEY 'Vw°\~ _

on5koandAbidjan\ J~~~~~~~~~~~~~~~~~~~~~~~o~ \; f ' 4 31

NIAME~~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~~- t DAE VOLTANDJMA

Thlebowadariee h. owne gihistop do wiot TO Ft-no imply endmretment o, acweptnner by threN IG E A and Connoon 5'nWrldAmookd its r,ffilotes to0

D'AHOMEY~t 10820 1z

SUMMARY AND CONCLUSIONS

I - Recent Developments

1. Unofficial estimates show that GDP at current market prices (no constant price data exisl:), after stagnating between 1967 and 1969, increased about 4-5 percent on average during 1970-1972. Allowing for population growth and inflation, however, real GDP growth per capita was negative in the last few years.

Sectoral Developments

2. Agriculture is the principal activity in Niger, providing a living for 90 percent of the population and accounting for the bulk of export earnings. Crop cultivation is limited to a strip of land in the southern part of the country where average rainfall varies between 800 mm and 350 mm (see map). Animal husbandry extends farther into the northern regions. About 90 percent of the cultivated area is devoted to food crops, mostly millet, sorghum and beans. Groundnuts and cotton are the main cash and export crops.

3. Because of repeated drought, the contribution of agriculture to GDP, which had been about 56 percent in 1966, fell to less than 48 percent in 1971 and probably declined further in 1972. Drought-induced fluctuations in food production necessitated considerable imports. While this went largely unnoticed by the rest of the world for a number of years, the 1972/73 drought received wide attention and prompted substantial aid from bilateral and multilateral sources. About 116,000 tons of grains were shipped to Niger in the twelve months ending October 1973, but less than 90,000 tons could be distributed within the country. Aid of at least twice that amount will be required in 1974. However valuable such aid may be in the short term, it cannot solve Niger's basic problem to find durable ways to feed its growing population.

4. Groundnuts also suffered substantially from the recurrent drought. The 1972/73 crop was one-third less than that of 1967/68, and the outlook for 1973/74 is still much bleaker. Moreover, the regional composition of marketed production changed appreciably during the past few years. While the Zinder region (East) considerably increased its share in the shrinking total, since its output was least affected by the drought, the Maradi region (Center) experienced a sharp fall in output and a corresponding reduction of its share, and the parit of the Dosso region (West) almost disappeared, largely because farmers found it more advantageous to grow food crops for which the Niamey area provided an increasingly profitable market.

5. Next to crop production, livestock has been Niger's most important source of income, employing about one-fifth of the population -- mainly nomadic or semi-nomadic Fuilani (Peuhls) and Tuareg. After the losses caused - ii - by the 1969 drought, which reduced the sector's share in GDP from 18 to 11 percent, the herd was estimated to have largely recovered before the 1973-1974 drought occurred. It is very difficult to assess the real effects of this drought on the livestock sector, since there have been considerable cattle movements across southern borders to evade the drought; but surveys conducted in the first quarter of 1974 seem to confirm the most pessimistic estimates: almost half the 1972 cattle herd may have disappeared due to starvation and emergency slaughtering.

6. Until recently, cassiterite was the most important product mined in Niger; it represented a very small export item. Research and prospecting by the French Commissariat a 1'Energie Atomique (CEA) yielded evidence of large uranium deposits in the department of Agadez, in the Sahara, ranking Niger fifth in the world after the United States, Canada, South Africa and France. Uranium production started in 1971 and reached 867 tons (concentrates; U3 08) in 1972 and an estimated 950 tons in 1973. Export demand was less than expected, however, and prices were depressed awing to a slowdown in construction of nuclear power plants so that part of the production had to be stockpiled. The energy crisis has favorably changed the outlook for uranium; the existing company has decided to go ahead with the planned expansion of its treatment plant, a second company is to be formed in 1974, which could start producing by 1979, and there are strong possibilities that a third company will begin operations in the early 1980's.

7. Despite considerable growth in recent years, raising its share in GDP from 9 to over 14 percent, industry still plays a relatively modest role in Niger. A restricted market, lack of raw materials, high cost of supplies due to long distances and a rudimentary transport system, and lack of cheap sources of energy are the main reasons for this situation.

8. Electric power is generated exclusively by diesel plants. Because of high production costs and total dependence on imported fuel, a situation which was substantially aggravated by the recent rise in crude oil prices, the Niger Government sought alternative sources of energy supply. As a first step, an agreement was signed with Nigeria concerning the purchase of power from the Kaindji dam; deliveries are expected to start in 1976. Dam projects are under study on the Mekrou river at the border with Dahomey and on the Niger river at Kandadji, and reportedly German firms have expressed interest in the establishment of a nuclear power plant.

9. The bulk of manufacturing consists of agro-industries, among which the processing of groundnuts is one of the main activities. Because of the continued decline in groundnut production, plants stood increasingly idle. Another problem is how to make the privately owned oil mills and industries based on local raw material in general contribute more to the national economy. Existing arrangements obliged SONARA, the marketing outfit, to sell groundnuts to the mills at prices 20-30 percent below export prices, whereas - iii - exports of processed groundnuts (oil and cakes), on average, yielded only 8 percent higher foreign exchange earnings than shelled groundnuts. Cotton fiber is either exported cr sold to NITEX, the most important industrial enterprise established in recent years. Despite the ample benefits provided by the Investment Code, including substantial price concessions, NITEX ran into financial problems because of competition from cheaper and better quality imports. To help overcome these problems, the Government authorized a price increase for NITEY products in 1972 and put a curb on imports.

10. Niger's landlocked economy is burdened with high transport costs resulting from an undeveloped transportation system and the long distances within the country as well as to the nearest sea ports. The domestic road system is being upgraded rith Canadian, FED and IDA assistance. The improvement of the transport infrastructure in neighboring Dahomey and Nigeria will help reduce shipping costEs of Niger's exports and imports, and the efforts to make the Niger river navigable are directed toward the same end. A first experimental barge convoy made the trip up-river from Port Harcourt to Gaya under a Canadian aid project in January 1973, but no final conclusions about the economic feasibility of river transportation have been reached yet.

11. Education is among the most fundamental and most difficult problems facing the Government. The key issue is cost and education efficiency relative to cost. The magnitude of the problem is illustrated by the fact that at 1971 unit costs and with six years of primary schooling it would have cost CFAF 6.9 billion (60 percent of 1971 revenue) to enroll the estimated 665,000 children of primary school age. But the previous Govern- ment's 10-year perspective plan avoided raising the crucial questions: Should mass education, to which the plan alludes, consist of the present six-year primary school; and, how can primary education costs be reduced. Education presently receivres about 20 percent of the national current budget and it is unlikely that this share can be increased in the light of pressing needs in agriculture and ]ivestock. At the same time, the growth of the economy is not likely to permit any significant increase in enrollments (the 1974/75 current budget "ceiling" is to be the same as in 1973/74) nor even the implementation ol the qualitative improvements planned (boarding at the lower secondary level, introduction of science and technology). At present, educational development policy is ill-defined and even confused: for example, extension of television to more primary schools (which alone would double current costs by 1980) as well as the program of qualitative improvement at the secondary level are being pursued. Overall reform is needed, leading to a reduction of program duration, adaptation of content and methods to development needs, and changes in the structure of costs (where salaries are the principal factor at present).

External Trade and Payments

12. In spite of repeated drought, merchandise exports grew rapidly between 1968 and 1972, because agricultural export earnings stood up quite well largely as a result of rising world market prices and the start of - iv -

uranium exports in 1971 brought diversification when it was most needed. Merchandise imports rose at a slower pace than exports, and the deficit of services and private transfers was reduced. As a result, the current balance improved with the deficit decreasing from CFAF 7.1 billion in 1968 to CFAF 5.8 billion in 1972. For 1968-1972 as a whole, the current deficit amounted to CFAF 36.5 billion. This deficit was more than compensated by inflows of private and public capital and, most importantly, public transfers, permitting the build-up, since 1969, of sizeable foreign exchange reserves. Despite the severe drought of the 1972/73 season, the 1973 balance of payments was again in overall surplus; net exchange reserves increased by CFAF 1.0 billion to CFAF 10.7 billion (US$48 million), equivalent to about 5.5 months' imports of goods and non-factor services.

13. Since most inflows of official funds in recent years were in the form of grants (about 90 percent of gross inflow in 1971 and 1972), Niger's external public debt remained quite manageable. At the end of 1973, the total amount outstanding was US$116.3 million, of which US$71.4 million were disbursed. Debt service payments, which were equivalent to about 3 percent of exports of goods and non-factor services in 1971 and 1972, are estimated to have been about 3.5 percent in 1973.

14. France, the European Development Fund, Canada, the USA, and the Federal Republic of Germany have been the most important aid donors in recent years, followed by IDA and the UN. During 1968-1973, Niger obtained commitments of about US$40 million each year from these sources, chiefly to finance projects in agriculture, transportation, and social infrastructure. Aid was also given by the Republic of China, Libya, Italy, the Republic of Korea, Belgium, Tunisia, and others. To this must be added the drought relief provided by various countries and international organizations which according to estimates by the Nigerien authorities amounted to about US$41 million in 1972/73. In January 1974, the EEC Commission approved additional emergency aid of 73.7 million U.C. for the six Sahel countries -- nearly four times the 1973 amount - to help cope with the effects of the persistent drought. This aid will be distributed in collaboration with the "Comite inter-Etats de lutte contre la Secheresse".

Public Finance

15. Through 1971/72, Niger was able to generate increasing budgetary savings; the current surplus reached nearly CFAF 900 million in that year, equivalent to 7.3 percent of revenue. The 1972/73 budget estimates showed an even larger surplus despite some tax reductions to help drought-stricken farmers and herders; the actual outcome is not yet known. In the 1973/74 budget plan the current surplus was reduced to about CFAF 300 million (2.3 percent of revenue), but it seems more likely now that the budget year will end with a current deficit. 16. When capital expenditures (excluding investment financed out of foreign aid) are taken inlto account, the current surpluses turn into deficits. Thus, in 1971/72, the overall budget deficit reached about CFAF 1.6 billion (11.4 percent of total expenditure) as investment climbed to CFAF 2.5 billion. The 1972/73 and 1973/74 budget estimates foresaw capital expenditures of over CFAF 3 billion each; as a result, the deficit increased to about CFAF 1.8 billion in 1972/73 and a record CFAF 3.0 billion in 1973/74 (19.2 percent of total spending). Financing for these deficits is obtained largely from abroad, most]Ly in the form of French treasury grants. In 1971/72, the share of foreign financing was 85 percent. The 1972/73 budget brought it down to 57 percent, since domestic financing was expected to contribute substantially more than in the preceding years, but in 1973/74 the entire deficit was to be covered by foreign grants. When the mission visited Niamey, only one-l:hird of the required amount had been committed.

17. Niger is a member of the French franc area. Together with Dahomey, Ivory Coast, Senegal, Togo, and Upper Volta it forms the West African Monetary Union. The Union has a common currency, the CFA franc, issued by a common central bank which maintains an agency in each member state. The CFA franc is freely convertible into French francs at the fixed rate of CFAF 50 = FF 1. 1'he agreements with France, on which the Monetary Union is based, have been revised in 1973 giving more power to the member states while retaining the French guarantee for their common currency.

18. Between 1968 and 1972 1/ net foreign assets of the banking system rose sharply while domestic credit declined (-9.8 percent a year), because the public sector (government and public institutions such as marketing boards, 2/ social security, etc.) steadily improved its net creditor position and credit to the private sector nearly stagnated. Since other factors also worked to offset the exparLsionary effect of the increase in foreign assets, the growth of money supply averaged only about 12 percent a year. In 1973, the growth of foreign assets was halved compared with 1972 while credit to the private sector expanded strongly, resulting in a growth rate of money supply of nearly 20 percernt.

19. A general price index for Niger is not compiled at present. The two existing consumer price indices for Niamey increased only moderately in 1970 and 1971. In 1972 and 1973, however, prices rose sharply mainly as a result of food shortages caused by the drought. It must be expected that this trend continued during the first half of 1974.

1/ No comparable data are available for 1973.

2/ Mainly the CSPPN. - vi-

II - Development Prospects

20. Following an assessment of the short run outlook Part II of the report focuses on the development prospects and strategies for the coming decade; it then briefly outlines the nature of the problems of the late eighties.

Short Term Outlook

21. Catastrophic crop failures and cattle losses due to the worsening of the drought in 1973/74, higher import prices resulting from accelerated worldwide inflation, and the "energy crisis" (resulting in a doubling of refined product prices to Niger), all concur to make 1974 probably the worst year for Niger's economy since independence. Real rural incomes will decrease perhaps by as much as 50 percent; the budget and the balance of payments will deteriorate considerably. However, the high level of external reserves and public sector liquidity at the beginning of 1974, the borrowing facilities offered by the central bank of the West African Monetary Union and the French convertibility guarantee for the CFA franc will prevent budget and balance of payments deficits from leading to a liquidity crisis; at the same time one can hope that international aid will meet in full the emergency food requirements of about 300,000 tons for 1973/74.

22. The outcome for 1975 will essentially depend on th'e amount and distribution of rainfall in 1974. Under the favorable assumption of good climatic conditions, a reasonable level of food supplies and some revival of agricultural exports can be expected, but the budgetary situation will remain difficult. The external accounts show better prospects thanks to uranium exports. Even with unchanged prices of uranium, the loss of 2/3 of reserves expected to occur in 1974 could be largely recovered in 1975.

Constraints to Development

23. The combination of natural, demographic, and economic conditions that constrain Niger's development effort is an unusually hard one. The climate is inimical in two ways: by severely limiting areas where cultivation is normally possible and by the occurrence of years of abnormally low rainfall as examplified by the current drought. Generally mediocre soils, erosion, further aggravate the climatic influence. Distances, both internal and external, are enormous, putting Niger at a disadvantage with competitors in export markets, burdening the cost of imports while failing to provide a sufficient protective barrier against imports because of the extreme narrowness of the local market.

24. The most precious of natural resources, water, though physically abundant underground, in the Niger and a few other rivers, is costly to exploit on a large scale. In particular, irrigation beyond about 15,000 hectares in the Niger valley (where 2,000 ha are already developed) would necessitate a regulatory dam on the river at a cost of probably more than $100 million. - vii -

25. Population growth (at a rate variably estimated between 2.2 and 3.6 percent) poses the faiiliar problems of education in the acute manner already noted (see para. 11) making it inconceivable to expand the present system in any significant degree. Productive employment opportunities outside the rural sector cannot, under the most favorable assumptions, increase by more than a few thousands whereas the working age population increases by forty or fifty thousand each year, most of whom are illiterate and unprepared to acquire attitudes and skills needed for some of the new development programs. The most serious difficulty lies in the growing pressure of population on land as evidenced by migration toward and even beyond the northern limit of the cultivable area, the high densities (30/sq.km. and above) in the most favorable zones of the south, the shortening of fallow periods over the years and erosion due to overgrazing in the pastoral zone. Thus, one reason for the dramatic character of the present drought stems from the fact that the population living in drought-prone areas is much larger now than in the past.

26. Finally, in determining its development policies and designing programs Niger is severely constrained by the country's high degree of dependence upon external factors which also imply an uncomfortable dose of uncertainty be it in terms of export markets and world prices, transport routes, sources of finance and technical knowledge, availability of production inputs as well as of consumption goods, notably foodstuffs.

Government Policies

27. At the time of the military take-over of April 1974, the previous administration was actively engaged in a thorough revision of former planning procedures as well as development objectives for the coming decade. However, no overall or sectoral program had been finalized. Indications were that the public investment program was set at CFAF 120 billion for a ten-year period, a level about twice as high as in the recent years. The new Govern- ment has not presented yet any general statement on economic issues. Some priorities and policy directions are apparent, however.

28. First priority is clearly given to food supplies, i.e. efficient distribution of relief food now and production thereafter. A second major objective is the growth andi diversification of agricultural exports in the longer run as a means to raise rural incomes and lessen dependence on groundnuts. Development of uranium exports and exploitation is already well underway and actively supported by the Government. Other sectoral objectives are less clear; an ambitious frame program exists, however, for road construction and rehabilitation of over 1,600 km that would call for external financing of CFAF 40 billion or so ($150 million). In education, the previous Government had apparently decided to go ahead with instructional television (ITV) at the primary level before a decision had been made about the scope and nature of educational reform and before the cost of the operation to Niger had been - viii - assessed. There is no doubt that Niger lacks middle and upper level skills. But, considering the relatively small number of persons required in each specialty, the problem is to find the most economical way to produce them; through education and training at home or abroad, or a combination of the two.

Strategies and Prospects

29. Niger's strategy for the long run should be based unreservedly on the agricultural sector with two closely related objectives: adequate food supplies with a reasonable degree of certainty, and development of exports. All other sectoral developments and consequently the choice of projects should be in support of these overall objectives. Special attention should be given not to burden public finances as a result of excessively generous fiscal treatment of private projects or of excessive maintenance cost of public projects such as transport infrastructure.

30. Prospects, under any reasonable hypothesis, are that the rural population will continue to increase over the next 10-20 years even with urban centers, which now represent less than 10 percent of total population, growing as in the past by about 6 percent per annum. This basic observation and the limited role that other sectors could play in augmenting both productive employment and output point to a role for agriculture which is both more limited and more ambitious than is suggested by the "normal" model of growth where the relative contribution of agriculture in GDP and the size of its labor force both diminish over time. The role agriculture in Niger is first to provide food for the rural population itself and for the urban centers; second, it is to provide the basis for export growth, both as a source of foreign exchange and as a key determinant of national income; it is also to provide a source of savings assuming these savings are reinvested in agriculture, which implies in particular that tax and quasi-tax revenue from the sector should certainly not, as in the past, exceed budgetary expenditure on the sector.

31. The proposed strategy for agricultural development would center around three basic programs to be implemented roughly over a ten-year period at a cost (end-1973 prices) of some CFAF 30 billion ($120 million): (a) four large-scale rural development operations (CFAF 16 billion) consisting of an expansion of the ongoing, FED-financed project (Zinder), a still larger operation in the Maradi region (to start in 1974 or 1975), one in the Dosso department and one, in the early eighties, in part of the Niamey department. These projects would cover 90 percent of cereal production and 100 percent of groundnuts and cotton producing areas. They would aim at the widest possible dissemination of simple, improved techniques leading to moderate but sustained average increases in yields (e.g. + 15 percent for cereals and + 33 percent for groundnuts after 5 years). They imply a denser extension network, strengthening of cooperative structures and above all farmers' participation. - ix -

32. (b) an irrigation program (CFAF 6 billion), chiefly the development of another 15,000 lha in the Niger valley where double cropping is possible, aiming at ensuring a modest but much-needed food insurance at the national level thus economizing both on land under rainfed cultivation (the 18,500 ha under irrigation will provide the same volume of cereals as 150,000 ha under rainfed farming with normal rainfall), and on food imports which, in case of a crop deficit, appear expensive as well as problematic. Recent progress made in management of irrigation projects opens an encouraging perspective in this respect. The irrigation program would be logically complemented by a much expanded and more effective buffer stock policy for basic foodstuffs, calling for a tenfold increase in storage capacity from the present 15,000 tons.

33. (c) in livestock, the reconstitution of the herd will take 8-10 years -- assuming no new climatic catastrophy occurs in the next few years. The essence of the development program (CFAF 7 billion) is to make effective the complementary character of the pastoral and farming zones; the former would remain a breeding zone of extensive cattle raising, ana fattening by small farmers or in small feedlots, eventually with irrigated fodder, would constitute complementary stages further south. The success of livestock development is very much dependent upon attractive prices to herders and consequently on a more liberal meat import policy in consuming countries on the coast, namely Nigeria, where demand is rapidly increasing.

34. Other aspects of an agricultural strategy will include development of agro-industries essentially by private capital (about CFAF 6 worth of projects seem feasible), agronomic research, training and price policies as the most important components.

Overall Growth and Balance of Payments Prospects

35. Agricultural production will grow only moderately in the seventies relative to pre-drought levels since this will be a phase of reconstruction, but it will be about 80 percent higher in the late eighties when the program has achieved full results. Exports in current terms could approximately double between 1972 and 1980 to reach CFAF 23 billion. Groundnut products will remain prominent (65 percent) for some time, but livestock products should become progressively more important in the eighties after the herd has been reconstituted and off-take rates raised. By the mid- eighties agricultural exports may more than double again. The projected increase in export values will result approximately in equal proportion from volume and from price increases.

36. The most notable development outside agriculture over the next decade will probably be in uranium exports from the existing (SOMAIR) and one or two newly formed mining ccompanies. Assuming a 50 percent price increase in the near future and a similar rise in the mid-eighties, uranium exports net of directly related imports, may be near CFAF 7 billion by the end of the seventies and CFAF 10 billion by 1985, against CFAF 2 billion in 1973. Even under fairly optimistic assumptions the real growth of GDP in the rest of the seventies can only be modest -- perhaps 3 to 3.5 percent p.a. -- picking up to 7 percent in the following five years or an average of 4-4.5 percent over the 14 years 1971-1985. 37. Despite the projected large increase in export values the external balance will continue to display large deficits on current account because of projected rises in import prices and even assuming a moderate growth of imports. The cumulative deficit is estimated to be close to CFAF 70 billion ($280 million) over the 6 years 1975-80 against CFAF 42 billion in the period 1968-73. This, however, should not represent a significant increase in the real volume of aid required and therefore not an unreasonable objective for external financing. In fact, it would be highly desirable that aid flows somewhat exceed the projected deficit. The resulting build-up of reserves would then reflect the participation of foreign sources in local cost financing, as the Government budget will not be in a position to contribute significantly to development expenditures.

38. Very serious growth problems can be foreseen for the years beyond the next decade or so, as a consequence of population growth relative to land availability and the difficulty of maintaining the expansion of agricultural output. Unemployment and inadequate food supplies or a decline in exportable production may be feared. Application of new -- as yet unknown -- techniques and/or massive doses of capital -- e.g. for the development of irrigation on a much wider scale -- , rapid development of mineral exports and of course population control are conceptually among the various solutions to the problem of a possible levelling off of overall growth and a long-run decline in real income. PART ONE

RECENT ECONOMtC DEVELOPMENT

A - General

Economic Growth

1. UN estimates for 1966-1969 and IMF estimates for 1970 and 1971 and show that GDP at current maarket prices, after stagnating between 1967 1969, increased by 4 percent in 1970 and by over 7 percent in 1971 (see Table 1). The severe drotught that struck Niger in the 1972/73 season un- doubtedly depresssed economic growth, but, given the state of statistical information, it is imposs:ible to quantify its impact with any precision. Roughly estimated, curreni: GDP growth may have been 2-3 percent in 1972. Allowing for population growth 1/ and inflation, 2/ real GDP growth per capita was negative over the past few years. 3/

2. Because of bad weather, agricultural production declined between 1967 and 1969, but this was compensated by increases in the services sector the same and, to a lesser extent, in industry. Hence GDP in 1969 was about de- as in 1967. The growth of GDP in 1970 in the face of a further drastic cline in agriculture caused by another drought reflected mostly the strong rise of industrial output following the start of operations of the Societe Nigerienne des Textiles (VITEX). The services sector also expanded consider- and the ably. In 1971, GDP growth was due to the recovery of agriculture beginning of uranium production by the Societe des Mines de 1'Air (SOMAIR). Industry grew at a slower pace than GDP and the services sector stagnated.

3. As a result of these deve]Lopments, the composition of GDP changed considerably between 1966 and 1971. The share of agriculture, which had On been nearly 56 percent in 1966, amounted to less than 48 percent in 1971. other hand, the contribution of industry (manufacturing) increased from the 11 just over 9 percent (6.3 percent) in 1966 to more than 14 percent (about percent) in 1971. The share of services rose slightly from 35 to 37 percent and that of mining from next to nothing to over 1 percent of GDP.

Investment and Saving 1966- 4. National expenditure data are available only for the period 1969. During these four years, consumption and investment exceeded GDP, causing rapidly rising import surpluses (see Table 2). The share of consumption expanded from abolut 94 percent of GDP in 1966 to over 100 percent fell in 1969, while that of investment, after growing to 10 percent in 1968, With to 6.5 percent in 1969 becamuse of drought-inflicted losses of livestock.

1/ Recently estimated by a UN paper to be 2.2 percent a year. 2/ Based on consumer price indices for Niamey, the only available indicators, the average price increase was 4.2 perdent during 1970-72. 3/ The 1973 World Bank Aitlas estimated average GNP per capita growth for 1965-1971 at -4.4 percent a year. Table 1: ECONOMIC GROWTH I967-I97I 1/

1 9 6 6 1 9 71 CFA F Growth Rates (Percent) CFA F Billion Percent 1967 196 1969 1970 1971 1967-71 Billion Percent

Agriculture 53.56 55.8 0.3 -5.2 -1.7 -7.3 11.9 -o.6 51.95 L7.6

Mining O.Oh 0.0 -8.1 250.0 -11.8 h.8 1000.0 2/ 1.21 1.1

Industry 3.72 9.1 o.h 6.1 8.0 49.L 5.5 12.7 15.81 1i.4

Manufacturing 6.03 6.3 2.3 5.2 -3.2 7L.8 8.6 1L.6 11.92 1C.9 Electricity and water supply 0.38 0.4 5.5 7.7 38.5 1L.2 18.8 16.L 0.82 0.7 Construction 2.31 2.L -5.4 8.5 33.0 5.3 -7.2 5.9 3.07 2.8

Services 33.70 35.1 L.1 0.2 6.9 6.9 -o.1 3.6 LC.15 36.9

Commerce 13.82 16.4 -0.3 -3.5 8.L 6.7 -4.5 1.2 14.70 130r r Transportation, communications 2.47 2.6 12.1 -4.7 18.6 32.9 1.2 11.3 4.21 3.9 Government 6.61 6.9 7.9 L.L 5.5 2.3 2.6 4.5 8.24 7.6 Other services 10.80 11.2 5.7 3.3 3.4 3.3 3.3 3.8 13.00 11.9

Gross domestic product (PIB) 96.02 100.0 1.6 -2.1 2.4 4.0 7.3 2.6 109.12 100.0

1/ At current prices; constant price national accounts data are not available. 2/ Over 100 percent a year.

Source: Statistical Appendix, Tables 2.1, 2.2, and mission estimates. - 3 - declining agricultural production and income, the share of exports of goods and non-factor services dropped from over 13 percent in 1966 to less than 11 percent in 1969, and gross domestic saving decreased from an already modest 6 percent in 1966-1967 (neighboring Mali's national accounts for 1969-1972 show a saving rate of 12 percent) to under 5 percent in 1968 and turned negative in 1969. Using balance of payments data as a substitute for non- existent national accounts, it appears that Niger's basic situation of dependence on foreign rescources has remained unchanged despite some improvement in recent years (see Tabile 5).

B - Main Sectors

Agriculture

5. Agriculture is the principal activity in Niger, providing a living for most of the population and accounting for the bulk of export earnings. Crop cultivation is limited to a strip of land in the southern part of the country where average annual rainfall varies between 800 gm and 350 mm (see map). Animal husbandry extends farther into the northern regions.

6. About 90 percent of the cultivated area is devoted to food crops, mostly millet, sorghum, and beans (niebe and voandzou). Other food crops are cassava, sugarcane, rice, onions, sweet potatoes, and corn. While these crops are chiefly grown for domestic consumption, exports of beans and onions to neighboring countries are of some importance. During 1967-1972, each represented about 2 percent of recorded merchandise exports, and more were shipped out through traclitional channels. Most crops are planted and harvested in the second half of the calendar year and marketed in the first half of the following year.

7. After .a recovery in the crop year 1969/70, production of millet and sorghum suffered a subst:antial setback in 1970/71 because of recurring drought: despite some expansion of cultivated area, only about 1.1 million tons (82 percent of 1967/68) were harvested. Output of other crops also suffered. As a result of further expansion of area and somewhat better weather in 1971/72, output of millet and sorghum reached more than 1.2 million tons (91 percent of 1967/68). Sugarcane and onions also showed gains, but cassava, beans, and rice declined. In 1972173, the recurrence of poor weather caused food production to fall again. The millet and sorghum crop was just over 1.1 million tons (84 percent of 1967/68), and that of cassava and onions dropped sharply. On the other hand, the bean harvest soared to a record level (nearly 140 percent of 1967/68), and output of rice and sweet potatoes also improved. Details are given in Table 3.

8. Because of these fluctuations in food production, considerable imports were necessary to prevent famine. While this went largely unnoticed by the rest of the world for a number of years, the 1972/73 drought received - a -

Table 2: RJSOIRCF.ITILI7ATION (Percent of cuirrent CGDP)

1966 1967 1-968 1969

Consumption 93.7 9L.1 95.3 100.3

Private (82.L) (32.2) (82.8') (87 .l,) Public (11.3) (11.9) (12.y') (12.9)

Investment 8.8 9.0 1.0.0 6.5

Fixed capital formation ( 7.8) ( 7.7) ( 8.(') (10.9) Investment in livestock ( 0.9) ( 1.l) ( -')) (-IL.-) Inventory change ( 0.1) ( 0.2) ( 0.5) (-0.3)

Gross domestic expenditure 102.5 103.1 1C5.3 106.8

Import surplus -2.5 -3.1 -5.3 -6.3

Exports of goods and NFS ( 135) ( 12.9) ( 11.9) ( 10.8) Imports of goods and NFS (-16.0) (-16.0) (-17.?) (-17.6)

Gross domestic product 1/ 100.0 100.0 100.0 100.0

Less: Consumption 93.7 9A.1 95.3 100.3

Gross domestic saving 6.3 5.9 L.7 -(.3

1/ Produit interieur bruit.

Source: Statistical Appendix, 'rable 2.). - 5 - wide attention and prompl:ed substantial aid from bilateral and multilateral sources. About 116,000 t:ons of grains were shipped to Niger in the twelve mDnths ending October 1973, but less than 90,000 tons could be distributed within the country. Food aid requirements in 1973/74 are much higher, possibly over 300,000 tons; shipments of this size pose difficult transport problems and delays seem inevitable. In any event, food relief cannot solve Niger's basic problem to find durable ways to feed its rising population.

9. Groundnuts, which are grown mainly in the eastern (Zinder) and central (Maradi) parts oi the country, are the principal cash and export crop. Following a 15 percent decline in 1968/69, output declined even more sharply (-18 percent) in 1969/70 in spite of improved weather, since cultivated area was substantially reduced to make room for expanded food production. With recurring drought in 1970/71, a 12 percent increase in area -- possibly induced by the government's decision to raise producer prices -- did not bring any gain in output. Further expansion of area (+10 percent) and better weather in 19:71/72 resulted in a recovery of production to 257,000 tons (25 percent over 1970/71, but only 86 percent of 1967/68). Despite another increase of cultivated area (+6 percent), the 1972/73 drought reduced the crop to a low of about 200,000 tons (67 percent of 1967/68). The outlook for 1973/74 is still much bleaker; according to the most recent reports, the crop may be as lowJ as 20,,000 tons.

10. Groundnuts are marketed by the Societe Nigerienne de Commercialisa- tion de l'Arachide (SONAMA), a mixed enterprise. The composition of marketed production changed appreeiably in the past five years. The Zinder region supplied over two-thirds of the total in 1972/73 compared with less than 50 percent in 1967/68, since its output was least affected by the drought, declining only 16 percent between the two years. The Maradi region, on the other hand, experienced a sharp fall in output (-60 percent); as a result, its part in total marketed production was reduced from about 47 percent in 1967/68 to little over 30 perceni: in 1972/73. Finally, marketed production in the Dosso region, which had accounted for about 5 percent of the total in 1967/68, dropped to 1 percent in 1972/73, largely because farmers found it more advantageous to grow food crops for which the Niamey area provided an increasingly profitable market.

11. Marketed groundnuts are either exported, sold to local oil mills, or kept as seeds. With exptnding milling capacity in the face of shrinking supplies of groundnuts, the portion delivered to local mills increased from 11 percent in 1967/68 to neairly 60 percent in 1972/73, while that of exports was reduced from 88 percent to less than 40 percent. However, even with the preferential treatment of local processing reflected in this shift excess capacity remained. On the other hand, SONARA saw its extended marketing system increasingly under-utilized. 1/ Groundnut exports are shipped either via Cotonou, Dahomey, or via Lagos/Apapa, Nigeria (see map). While in

1/ A positive aspect o1 this situation is that SONARA's idle transport capacity can now be used to help move food relief shipments. Table 3: PRINCTPAL CROPS

1967/68 1968/69 1969/70 1970/71 1971/72 1-972/73

Production (in thousands of metric tons)

Food crops

Millet 1,000 733 1,095 871 958 919 Sorghum 342 215 289 230 267 208 Beans 1/ 119 101 127 114 103 165 Cassava 169 198 197 182 166 95 Sugarcane 21 25 25 37 54 54 Rice 33 39 38 37 27 32 Onions 44 39 27 31 36 20 Sweet potatoes 13 10 9 8 9 12 Corn 3 2 2 2 2 2

Cash crops

Groundnuts (in shell) 298 252 207 205 257 200 2/ Seed cotton 6 7 13 11 9 6

Area under cultivation (in thousands of hectares)

Food crops

Millet 1,865 1,895 2,272 2,310 2,356 2,370 Sorghum 530 557 596 593 579 581 Beans 1/ 739 793 1,028 1,036 1,056 971 Cassava 21, 27 28 24 24 19 Sugarcane 1 1 1 1 2 2 Rice 12 15 16 16 17 17 Onions 2 2 2 2 2 1 Sweet potatoes 1 1 1 1 1 1 Corn 5 4 3 3 3 h Other 3/ 3 4 7 29 30 26

Cash crops

Groundnuts 357 432 320 358 39L 418 Cotton 17 17 20 20 21 15

1/ Mainly niebe beans. 2/ Tentative estimate; based on past relationships between marketed (110,000 t) and total production, the figure may be as low as 170,000-195,000 tons. 3/ Includes tomatoes, okra, red pepper, tobacco, fonio, wheat, sesame.

Source: Ministere de 1'Economie Rurale, Direction de l'Agriculture, Annual Reports. See Statistical Appendix, Tables 7.1 and 7.2. -7-

1967/68 about 63 percent l:ook the route via Nigeria, the share rose to over 70 percent in the three years 1969/70-1971/72 and to 96.5 percent in 1972/73, partly because this was the most convenient outlet for the Zinder region, partly because the Nigeria railways demanded an interesting transport volume (40,000 tons for the 1972/73 campaign) in exchange for reasonable tariffs for Niger's imports they hand]ed.

12. Cotton is Niger's second cash and export crop. Production started on a larger scale after 1956, when the Compagnie Francaise pour le Developpe- ment des Fibres Textiles ICFDT) was entrusted with the task of developing the culture in collaboration with local authorities. 1/ Niger's climate and soil are only marginally suitable for cotton cultivation; production is concentra- ted in the region of Tahoua which accounts for over 80 percent of the total.

13. After reaching Et record level in 1969/70 (over 200 percent of 1967/ 68), cotton production declined steadily, reflecting unfavorable weather as well as, in 1972/73, a substantial reduction in cultivated area. The 1972/73 crop was only 6,000 tons, the same as in 1967/68, and the estimate for 1973/74 is 3,000 tons. Through price incentives the government succeeded in improving quality considerably, and efforts are made to raise yields by supplying farmers with subsidized fertilizer and encouraging the use of selected seeds. Improvements in production. will be difficult to achieve, however, as long as drought conditions persist, practically forcing farmers to shift from cash crops to food crops.

14. Next to crop production, livestock has been Niger's most important source of income, employing about one-fifth of the population -- mainly nomadic and semi-nomadic Fulan.i and Tuareg. During 1966-1968, the livestock sector accounted for 18 percent of GDP; in 1969, its share plunged to 11 percent because of severe drought. Exports of live animals, hides, skins, and meat constituted 21 percent of total recorded exports in 1972; in addition, a substantial number of animals was exported through traditional channels.

15. After the losses caused by the 1969 drought, goats and sheep were estimated to have fully recovered during 1970-1972, while cattle and camels recovered partially (see Table 4). It is very difficult to assess the present situation of the livestock sector, since considerable movements of animals across southern borders occurred to evade the 1973-1974 drought. Htowever, surveys conducted in the first quarter of 1974 seem to confirm the most pessimistic estimates: almost half the 1972 cattle herd may have disappeared because of starvation and emergency slaughtering.2/

16. Fishing is a relatively minor activity in Niger (little over I percent of GDP during 1966-1969), although the Niger river, the Komadougou, and

1/ See Volume III, Agriculture, Annex XIII, paragraph 8 ff.

2/ Table 4, page 8 includes estimates for 1973 based on a survey of the situation in December of that year showing losses of about 37 percent. - 8 -

Niger's part of lake Chad constitute a fairly large area available for fishing in normal years. Over 1,000 fishermen are estimated to operate on the Niger river, many of them foreigners from other African countries. The equipment used is traditional, except for a few motorized canoes. Some 3,000 fishermen fish on lake Chad and the Komadougou river. Physical conditions on the lake shore make operating with small boats (built of papyrus stems) rather difficult. Total annual catch is estimated at 10,000 tons, of which about 20 percent is consumed fresh; the rest is dried and smoked and largely exported to neighboring countries. Since proper transport and storage facilities are lacking, losses through insect infestation are high.

17. Forests, or rather more densely wooded patches of savanna, located in scattered areas in the southern parts of the country (about 600,000 ha), provide wood for the construction of traditional housing and for use as fuel. Other types of lumber generally have to be imported. Most forests are pro- tected, cutting being permitted only under special licenses.

Table 4: LIVESTOCK

(In thousands; end of period)

1968 1969 1970 1971 1972 1973

Cattle 4,500 4,000 4,000 4,100 4,200 2,650

Sheep 2,430 2,070 2,700 2,765 2,850 2,140

Goats 6,140 5,700 6,000 6,165 6,300 5,355

Camels 360 330 345 345 345 287

Donkeys 360 335 370 370 370 277

Horses 170 170 200 200 200 170

Source: Data provided to the IMF by the Niger authorities. For 1973: Etude sur la situation actuelle de l'Elevage dans les pays du Sahel, 1974. See footnote 2, page 7.

Mining

18. Until recently, cassiterite was the most important mineral mined in Niger. Production is very modest; it reached 136.6 tons in 1972 against 125.9 tons in 1971. Exports -- to Belgium and Nigeria -- were 145.3 tons in 1972 (CFAF 70.7 million). - 9-

19. Research and prospecting conducted by the French Commissariat a l'Energie Atomique (CEA) since the beginning of the 1960's yielded evidence of important uranium deposits at Arlit (more than 20,000 tons), Akouta (also over 20,000 tons), Madouela (about 8,000 tons), and Azelik (about 7,000 tons), all in the department of Agadez, in the Sahara. With these deposits, Niger ranks fifth in the world after the United States, Canada, South Africa, and France.

20. On January 10, 1971, the Societe des Mines de l'Air (SOMAIR) 1/ produced the first uraniun at Arlit, and exports started in the following month. Production reached 410.5 tons in 1971 and more than doubled to 867.0 tons in 1972. Only roughly half of the 1972 production was exported, since demand was less than expected and prices were depressed owing to a slowdown in construction of nuclear power plai:ts, and SOMAIR hesitated to go ahead with the planned expansion of its capacity to 1,500 tons per year. 2/ The expansion was started in 1973, however, and was to be completed in 1974. During the first six months of 1973, exports amounted to 808 tons. Although prices had dropped 15 percent compared with the first semester of 1972, this still represented a value of CFAF 3.4 billion, more than compensating the shortfall of agricultural exports caused by the drought. But uranium exports leave only limited net benefits for Niger, since inputs are mainly imported (equipment and supplies, expatriate staff), and the distribution of income from uranium sales is, of course, totally different from that of income from traditional exports.

21. Japanese interest in the Akouta deposit (near Arlit) led to the formation, in 1970, of an association of Niger, the CEA, and the Overseas Uranium Resource Developmemt Corporation (OURD) of Japan. The three partners agreed on a two-phase approach: In the first phase, financed by OURD, the deposit would be mapped precisely; next, a company similar to SOMAIR would be formed, in which the Japanese would hold a 25 percent and Niger a 30-40 percent participation. ResuiLts obtained so far show that up to 30,000 tons could be mined; since the uranium is found at a depthi of about 250 m compared with 35-100 in at Arlit, this would require sinking shafts and developing galleries. The necessary investment would be in the order of CFAF 19 billion (Arlit: CFAF 16.5-18 billion, including infrastructure and the second treatment plant now under construction). In January 1974, talks were held in Niamey and Paris concerning the setting up of the planned mining company, to be known as the Compagnie Miniere d'Akouta (COMINAK). It was indicated that the formalities involved in forming the company could be completed by May 1974. COMINAK could go into production by 1979, starting with 2,000 tons per year.

1/ In 1970 the capital of SOMAIR was raised to CFAF 3.2 billion, of which 33.5 percent is held by the CEA, another 33.5 percent by the group Pechiney-Mokta (18.84 percent) and the Compagnie Francaise des Minerais d'Uranium (14.66 percent), 8.125 percent each by Urangesellschaft (Germany) and AGIP Nucleare (Italy), and the remaining 16.75 percent by the Republic of Niger. 2/ W4orld prices declined, about 30 percent during 1970-1972 and Australia and Canada were selling part of their stocks at $4.50 per kilogram. - 10 -

22. The group Niger-CEA-OURD is also pursuing the study of a coal deposit in the area of Anou Araren, near Agadez, which could provide the fuel for a thermal power plant serving Akouta. The deposit, estimated at 4.5 million tons at a depth of about 40 m, is said to be amply sufficient to supply energy during the entire mining operation.

23. In 1972, after more than a decade of prospecting covering the most promising areas of the country, the CEA began looking for partners to join its efforts. In December 1973, an agreement was signed by Niger, the CEA, and Urangesellschaft of Germany (which alreadv holds a share in SOMAIR) concerning uranium prospecting and, eventually, mining in the Djado area (Northeast of Niger). The Societe des Mines du Djado was founded with 35 percent Government of Niger, 35 percent Urangesellschaft, and 30 percent CEA participation. Niger's part will be financed by German aid. The possibility of other inter- ests participating in the company was left open. Prospecting costs are estimated at CFAF 3 billion. 1

24. The US Continental Oil Company (CONOCO), which is already prospecting for oil in Niger, announced in April 1974 that it had joined the CEA in signing a three-year agreement with the Niger government on uranium prospecting in the area of Imouraren, about 80 km south of Arlit and 100 km north of Agadez. For the case that exploitable deposits are found, the agreement provides that each partner can market his share of the production individually -- which precludes a situation like 1972 when SOMAIR stockpiled part of its output while the Niger government would have preferred to see it all sold. The costs of prospecting are to be shared equally between CONOCO and the CEA.

25. Upon the invitation of the Nigerien and Gabonese governments the French Minister of Industry visited Niamey on March 22, 1974, to discuss "uranium problems". The tripartite discussions lasted two davs and ended without result, but it was decided that they would be resumed "as soon as possible". In view of the military take-over in Niger on April 15, 1974, it is not clear when this will be; so far, the new government has only announced that the question of uranium "would be discussed when its time comes".

26. Besides uranium and cassiterite, actual mining output consists of a few kilograms of gold each year -- 7.3 kg in 1970, 3.7 kg in 1971 -- and the gypsum and limestone produced by the cement factory at Malbaza. Iron ore deposits totalling 600 million tons, of which about one-sixth is of high grade, exist near Say. Their exploitation depends on the navigability of the Niger river and on the availability of a cheap source of energy.

27. After Petropar, Shell, and liunt had abandoned their permits in 1965 (having spent CFAF 4.3 billion), no oil prospecting was done in Niger until 1970. Since early 1970 four US companies -- Texaco; Continental Oil - Shell; Global Energy Co. - Sun Oil- Bishop Oil -- search for oil; their permits cover an area of 885,000 km . Total spending by these companies during 1970- 1972 was CFAF 2.2 billion, half of which by Texaco. Texaco may start drilling in 1974. Industry

28. Despite considerable growth in recent years (12.7 percent annually during 1967-1971), industr7 still plays a relatively modest role in Niger. A restricted market, lack of raw materials, high cost of supplies due to long distances and a rudimentar7 transportation system, and lack of cheap sources of energy are the main reasons for this situation.

29. Electric power is generated exclusively by diesel plants. The Societe Nigerienne d'Electricite (NICELEC), a mixed enterprise, is responsible for production and distribution in the main urban centers. At the beginning of 1973, it had plants in Niamey (installed capacity 15,600 kW), Maradi (1,090 kW), Zinder (970 kW), Tahoua (270 kW), and Agadez (250 kW), and was preparing to take over the facilities at Dosso. Besides, NIGELEC is charged with the distribution of the electricity produced by SOMAIR's plant (8,600 kW) at Arlit. The cement factory at Malbaza operates its own generator (524 kW). In addition, the government maintains small generating units in a number of communities.

30. With the start of operations of NITEX in 1970, the textile industry became by far the most important industrial consumer of electricity. 1/ Commercial power consumption rose 50 percent in 1970 and an average 15 percent in 1971-1973, while total consumption increased by 19 percent in 1970 and an average 11 percent in 1971-1973.

31. Because of high production costs 2/ and total dependence on imported fuel, a situation which was substantially aggravated by the recent rise in crude oil prices, the Niger government sought alternative sources of energy supply. As a first step, an agreement was signed in 1971 with Nigeria concerning the purchase of electricity from the Kaindji dam station, the capacity of which (960 MW) is now only partially utilized. Canada agreed to finance the construction of the required transmission line from the Nigeria/Niger border to Niamey. Before the energy crisis it was estimated that electricity prices would drop about one-third with the completion of the project. Because of delays on the Nigeria side, deliveries are now expected to start in 1976 instead of 1975 as originally planned.

32. Another project is the construction of a dam and power plant on the Mekrou river at the border with Dahomey. It is to assure power supply from about 1980 on, when Nigeria is estimated to absorb the entire output of Kaindji so that deliveries to Niger would cease. According to an EDF/FAC study made in 1969, the project (including a 212 km transmission line) would

1/ See Statistical Appendix, Table 8.1.

2/ Electricity prices in. Niger vary between CFAF 23.5 and CFAF 37.0 per kWh, said to be among the highest in the world. - 12 - cost CFAF 3.3 billion for an installed capacity of 15,000 kW and a guaranteed capacity of 7,500 kW. 1/ The study of a dam site on the Niger river upstream of Tillabery (Kandadji) is being undertaken by a private US-Prench group, and German firms have shown interest in the establishment of a nuclear power plant (80,000 kW).

33. The bulk of manufacturing consists of agro-industries, among which the shelling of groundnuts is one of the main activities. In recent years, the three shelling plants owned by SONARA at Dosso, Malbaza, and Tchadaoua achieved a turnover of CFAF 1.8 billion. Because of the continued decline in groundnut production, however, their capacity of about 80,000 tons (unshelled weight) stood increasingly idle, and two plants had to be shut down recently.

34. Until 1972, there were two groundnut oil mills in Niger, one at Maradi owned by the Societe Industrielle et Commerciale du Niger (SICONIGER) with a capacity of 25,000 tons (shelled weight), and one at Matameye (18,000 tons) owned by the Societe des Huileries du Niger (SIUN). In 1972, both SHN and SICONIGER (+45,000 tons) expanded their capacities, and a third company, the mixed German-Nigerien Societe d'Exploitation des Produits d'Arachide du Niger (SEPANI), began operations at Magaria (40,000 tons). SEPANI, which plans to establish a refinery for table oil in the future, operates under a very advantageous "convention" providing not only tax benefits but also price and supply guarantees for groundnuts delivered by SONARA. 2/ The volume of groundnuts transformed into oil increased from 20,600 tons in the 1967/68 season to 65,000 tons in 1972/73. WJith the recent plant expansions it is clear, however, that unless groundnut production recovers, considerable excess capacity will persist even if groundnut exports are reduced to a bare minimum. Another problem that must be solved is how to make the oil mills contribute more to the national economy. The existing arrangements obliged SONARA to sell groundnuts to the mills at prices which were 20-30 percent lower than export prices, whereas exports of groundnut oil and cakes earned, on average, only 8 percent more than shelled groundnuts.

35. Paddy rice is processed by Riz du Niger at Tillabery and millet and sorghum by SOTRAMIL at Zinder, two enterprises in which the Niger government has a majority participation. Riz du Niger has generally operated efficiently, although scarce supplies limited its activity. After a long experimentation phase, SOTRAMIL succeeded in producing stabilized millet flour for noodles and biscuits which sell at competitive prices. As a result, a first operating surplus was achieved in 1970/71.

1/ A recent cost estimate gives a total of US$21 million (CFAF 4.7 billion at the 1973 exchange rate).

2/ The same prices apply to the other two oil mills. For details see Volume III, Agriculture, Annex XIII, paragraph 15. - 13 -

36. The CFDT maintains three cotton mills in Niger. The cotton fiber is either exported or sold to NITEX. NITEX, a private French company, is the most important industrial enterprise established in recent years, representing an investment of CFAF 2.3 billion and employing up to 600 workers. Its annual capacity is 200 tons of raw cloth, 600 tons of bleached cloth, and 3 million meters of printed cloth. Despite the ample benefits provided by the Invest- ment Code (inter alia, a price of cotton delivered to the firm 30 percent lower than export prices), NITEX ran into financial problems in its initial years because of competition from cheaper and better quality imports. To help overcome these problems, the government permitted a 20 percent price increase for NITEX products in 1972 and put a curb on imports, consisting of higher tariffs and volume restrLctions for some items and an outright ban for others.

37. Processing of Livestock products is gaining importance. Since 1965, three tanneries have been established at Zinder, Maradi, and Niamey with a total capacity of more than 1.4 million hides and skins per year. The Societe Nationale des Cuirs et Peaux is responsible for the organized marketing of their products. To promote meat exports, refrigerated slaughterhouses are planned at M'aradi and Talhoua in addition to the one existing in Niamey. The Niamey slaughterhouse produces about 3,500 tons of meat annually, of which one quarter is exported.

38. nTo mixed ente:rprises supply building materials. The Societe Nationale de Cimenterie 1'SNC), established in 1966 with FAC financing, produces cement at Malbaza. Because of high costs it cannot compete with imports. In deficit until 1969/70, it profited in that year from demand for the construction of the mining town of Arlit and the Kennedy Bridge in Niamey. As a result, its capacity of 45,000 tons was for the first time nearly fully utilized. A new though possibly temporary market for SNC cement has developed in Northern Nigeria owing to technical difficulties experienced by the Sokoto cement plant. The Societ:e Nigerienne des Produits Ceramiques (SONICERAM) manufactures bricks, other building materials, and ceramics. Like SNC it operates below capacity. Its main problem, further aggravated by the recent oil price increases, is the high cost of fuel; attempts to substitute groundnut shells or wood for fuel cil have not been very successful.

39. Other industria!l enterprises of some importance are the Societe des Brasseries et Boissons Gazeuses du Niger; the SONIFAME, conceived to manu- facture agricultural implements, but now successfully producing metal furniture, mainly for schools; and the Societe des Produits Chimiques du Niger (turnover CFAF 300 million), which produces soaps and detergents. In addition, there are a number of smaller firms manufacturing paints, industrial gases, plastic articles, matches, candy, and perfumes, as well as a printing house.

Transportation

40. Niger's landlocked economy is burdened with high transport costs resulting from an undeveloped transportation system and the long distances within the country as well as to the nearest sea ports, Cotonou and Lagos/ Apapa (see maps). The improvement of the transport infrastructure in - 14 - neighboring Dahomey and Nigeria -- for instance the rehabilitation of the Parakou-Malanville road now underway with US-AID (US$8 million) and IDA (US$11.8 million) financing -- will help reduce shipping costs of Niger's exports and imports, and the efforts to make the Niger river navigable are directed toward the same end. Domestic transport is mostly by road. There is no railway. Land transport by motor vehicle is complemented on the one hand by animal transport, on the other hand by air transport. Water transport is of little importance.

41. Niger has about 11,000 km of roads, of which about 12 percent are paved; the rest are dirt roads and tracks. The backbone of the road network is the 1,800 km long west-east axis between the Mali and Chad borders crossing the most fertile and most densely populated southern parts of the country. From this main axis, which is being upgraded with Canadian, FFD, and IDA assistance, roads go north and south linking the major towns and continuing across the Sahara to the Mediterranean and across the southern border to the railheads of Parakou in Dahomey and Kano in Nigeria.

42. Transportation by camelback is still quite important, especially in the sparsely populated north where the transport volume is too low to justify the construction of modern roads, even though operating costs are estimated to be two to three times higher than for trucking. 1/ In 1971, the total number of vehicles registered in Niger was 13,300, of which somewhat less than half were passenger cars (including commercially used vehicles).

43. The completion of the Kaindji dam in Nigeria made the Niger river potentially navigable for about seven months of the year (between September and April). Canada is studying the possibility of river transportation with low-draft barges, and US-AID committed funds to raise the bridge at Gaya which is necessary to permit traffic to pass up to Niamey. A first experimental convoy made the trip upriver from Port Harcourt to Gaya in January 1973, but no final conclusions have been reached yet under the Canadian project. The eventual construction of the Kandadji dam would make the Niger navigable all year round. Although hurting OCDN, the joint Dahomey-Niger transport enterprise handling traffic between Cotonou and Niger, river transport would bring substantial benefits in the form of reduced shipping costs, particularly for bulk cargo like petroleum products, and would remove one of the obstacles that now prevent the exploitation of Niger's known mineral reserves (Say; Liptako-Courma).

44. Air transport is centered around Niamey airport which is the closest to Europe of all West African airports south of the Sahara and is conveniently located on the main routes to serve as a transit stop. Over the past five years, the number of transit passengers increased about 20 percent annually

1/ The development of new uranium mines (see Section Mining above) may change the economics of road projects in this region, however, because of the large volume of imports required in the operation. - 15 -

(against 7 percent for Niamey passengers) and the number of flights about 10 percent, partly because of increased cargo services. Five international airlines fly to Niamey, -including Air Afrique, in which Niger holds a 6 percent participation. Domestic routes are served by Air Niger, a mixed enterprise which has a networlc of some 2,600 km connecting five airports (Maradi, Zinder, Tahoua, Agadez, Arlit). These services are complemented by air taxi operations using 18 airf:Lelds.

45. Exports of meat and vegetables to coastal African countries and to Europe, a small but promLsing activity, depend on air transport. To facilitate such exports and to accomnodate aircraft of growing size, Niamey airport is being modernized under a long-term development plan prepared by ASECNA. 1/ IDA made a credit of US$5 mi:Llion for this purpose in May 1974.

Education

46. Among the most fundamental and most difficult problems facing the government, education has reached a major turning point, a fact that was clearly recognized in the former administration by the Ministry of Develop- ment and the Ministry of Education planning team, but which the political/ professional branch of the Ministry of Education dared not face. The key problem is cost and education efficiency relative to cost. The Ministry of Development estimated that to achieve the targets of the "Perspectives Decen- nales" prepared by the MlLnistry of Education in November 1972 current education expenditures would have to be raised from CFAF 1.5 billion in 1973 to CFAF 5.4 billion in 1982, or from 18 to 27 percent of total expenditures.

47. Primary education costs are staggering: about CFAF 380,000 on average per primary school teacher and about CFAF 240,000 for an unqualified "moniteur", against a per capita GDP of CFAF 20-25,000. At 1971 unit costs (CFAF 10,400) and with six years of primary schooling, it would have cost CFAF 6.9 billion (60 percent of 1971 revenue) to enroll the estimated 665,000 children of primary school age. The previous government's plans were only to expand enrollment from 94,500 in 1971/72 to a minimum of 175,000 and a maximum of 275,000 by 1982. These plans were remarkably conventional, however, and avoided raising the fundamental issues: (i) should mass education -- to which the "Perspectives" allude -- consist of the present six-year primary school; and (ii) how can primary education costs, and especially teacher salaries, be reduced? Of course, these questions are seen in a different light by planners and the rather powerful teacher unions.

48. Niger has experience with ITV since it allowed France to run an experiment with a new primary education curriculum for several years. But this went on without involvement of the Ministry of Education and concerned

1/ Agence pour la SecuLrite de la Navigation Aerienne en Afrique et a Madagascar. - 16 - only a small number of pupils around Niamey. A third of them entered the first grade of secondary education in 1972/73, where they were unable to adapt to rigid classroom discipline, absence of team work, and authoritarian teaching methods.

49. Ex-president Diori Hamani decided to go ahead with ITV despite these potential difficulties at the secondary education level and before a decision had been made about the restructuring of primary education. And also, it seems, before Niger's share of the costs of ITV had been assessed. Unit operating costs would be about CFAF 30,000 for a coverage of 10,000 pupils, decreasing to CFAF 6,500 for 247,000 pupils (90 percent of maximum enrollment projected for 1982); but total costs would increase from CFAF 300 million to CFAF 1.6 billion per year. Although the entire question of ITV is supposedly under review, extension to a further 100 primary classes is foreseen for school year 1974/75 and the microwave network is therefore being extended at Niger's expense (since France is prepared only to finance the ITV production center and to give related technical assistance). A commitment to ITV is not only expensive but is in contradiction with the proposal to employ national languages as a medium of instruction in primary schools. The partial justification of ITV is the establishment of a telecommunications network. However, the viability of the network itself has not been established yet.

50. Proposals concerning secondary and higher education are for rapid expansion, which is justified by reference to modern sector manpower needs. These are at best uncertain, however, particularly since there is already some unemployment among holders of the lower secondary certificate (BEPC). Further, the type of education being developed seems inappropriate: the university in particular has high cost programs similar to those in France, with low teaching loads for instructors and a theoretical and literacy bias. Total salaried employment in 1970 was about 26,500 (excluding household personnel), with about 11,000 in the private sector and 15,500 in government. Extrapolating past growth in government (6 percent) and in the private sector (4 percent), plus 2 percent replacement, annual needs for all levels of qualification may be about 1,500 by 1982. In addition, allowance must be made for an accelerated replacement of expatriates. The crucial question is to determine the appropriate flow into secondary education. There is no doubt that Niger lacks middle level and upper level skills. Considering the relatively small number of persons required in each specialty, however, the problem is to find the most economical way to produce them: through education and training at home or abroad, or a combination of the two.

51. There are a number of innovative schemes of non-formal training in Niger, but without much coordination among each other. FED'maintains a functional literacy scheme in the Zinder area. UNICEF conducts an imaginative experiment integrating youths and women into an ongoing development project. In the Maradi project considered by IDA, UNCC (Union Nigerienne de Credit et de Cooperation) may play a leading role parallel with an expansion of - 17 - functional literacy efforts. 1/ Of these schemes, the strongest nationwide is the functional literacy program which operates 450 centers reaching 10,000 adults; it offers a three-year course taught by instructors who are paid as little as CFAF 2,500 per mDnth (against a SMIG of CFAF 5,500), and publishes newspapers in Haussa, Zarma, and Tamachek.

C - Financial Developments

Balance of Payments

52. In spite of repeated drought, merchandise exports grew rapidly between 1968 2/ and 1972, averaging 17.6 percent a year (in current prices), because agricultural exports stood up quite well largely as a result of higher world market prices and the start of uranium exports in 1971 brought diversification when it was most needed. Merchandise imports rose by only 11.8 percent a year; since they were 50 percent larger than exports in 1968, however, this was not sufficient to prevent the trade deficit from expanding (see Table 5). It reached a high of CFAF -6.8 billion in 1970, but declined to CFAF -3.7 billion thereafter. Net services and private transfers, of which net factor income represented about 10 percent, fell -- with intermediate ups and downs -- from CFAF -2.8 billion in 1968 to CFAF -2.1 billion in 1972. As a result of these developments, the current balance deteriorated considerably between 1968 and 1970 (from CFAF -7.1 to -9.2 billion), but improved even more (to CFAF -5.8 billion) during the following two years. For 1968-1972 as a whole, the current deficit amounted to CFAF -36.5 billion.

53. This deficit was more than compensated by inflows of private and public capital and public transfers, permitting the build-up, since 1969, of sizeable foreign exchange reserves. Medium- and long-term private capital inflow (net) increased from CFAF 2.0 billion in 1968 to CFAF 5.2 billion in 1970, financing equipment imports mainly of NITEX and SOMAIR, but fell back to CFAF 3.0 billion in 1971 and only CFAF 1.1 billion in 1972, as these investments were completed and no major new projects came up. Net (gross) public capital inflow peaked at CFAF 1.3 (1.8) billion in 1969 (a large part of which presumably represented the French government investment in SOMAIR) and showed even more pronounced annuatl variations than private capital inflow, although at a much lower level. Public transfers (net), on the other hand, increased steadily to CFAF 8.7 billion in 1972 (1968: CFAF 5.9 billion). About two- thirds of these transfers were French aid, another fifth grants by the European Development Fund (FED). 3/ Including SDR allocations and errors and omissions, net inflows of private and. public funds during 1968-1972 totalled CFAF 46.8 billion, thus allowing CFAF 10.3 billion to be added to foreign exchange reserves -- which for balance cf payments purposes are defined to include medium- and long-term foreign-liabilities of the banking system. At the end of 1972,

1/ See Volume III, Agriculture, Annex VII, paragraph 3, item vi. 2/ No balance of payments estimates exist for earlier years. 3/ See Statistical ApperLdix, Tables 3.1 and 3.6. Table 5: BALANCE OF PAYMFNTS (Billions of CFA F)

1968 1969 1970 15$71 1972

Merchandise exports 8.52 10.27 12.85 1L.Oh 16.29 Of which unrecorded exports 1/ ( 1.88) ( 2.hL) ( 1.90) ( 1.87) ( 1.70) Merchandise imports 12.78 16.19 19.66 18.20 20.00 Of which unrecorded imports 1/ ( 1.99) ( 2.8h) ( 2.6a) ( 2.49) ( 2.55)

Trade balance -4.26 -5.92 -6.81 -4.16 -3.71

Net services -2.83 -1.89 -2.L7 -2.19 -2.1L Of which factor income (net) (-0.10) (-0.29) (-0.21) (-C.22) (-0.22) Private transfers (net) 0.03 -0.26 0.05 - 0.05

Current balance -7.06 -8.07 -9.23 -6.35 -5.80

Private capital (net) 1.56 2.87 4.50 2.74 G.42 Of which medium- and long-term capital ( 2.01) ( 2.74) ( 5.19) ( 2.96) ( 1.12) Public transfers (net) 5.93 6.67 7.72 7.L3 8.70 Public capital (net) 0.78 1.33 0.69 -0.08 o.LL Drawings ( 1.19) ( 1.80) ( 1.05) ( 0.73) ( 1.31) Repayments ( 0.b1) ( 0.L7) ( 0.36) ( 0.81) ( 0.87) Other items (net) 2/ -1.39 -1.L6 -1.12 o.60 -1.L9

Change in reserves 3/ (increase = +) -0.18 1.34 2.56 4.3L 2.27

1/ Estimate. 2/ Tncluding errors and omissions. 3/ Including medium- and long-term liabilities of development banks.

Source: Statistical Appendix, Table 3.1. - 19 - net exchange reserves, so defined, amounted to CFAF 9.9 billion, 1/ equivalent to six months' merchandise imports or 4.5 months' imports of goods and non- factor services in 1972.

54. Despite the severe drought of the 1972/73 season, the 1973 balance of payments was again in surplus; foreign exchange reserves increased by CFAF 1,030 million, about half the amount registered in 1972. Judging by the scattered information available so far, this may have come about in the following way. Because of substantial price increases for all main agricultural exports, partly compensating the reductions in volume, and a doubling of uranium exports, total exports did much better than had been expected. Imports, on the other hand, grew only at about half the 1972 rate, since the sharp rise due to emergency aid shipments was in part offset by the decline in normal imports owing to the loss of purchasing power of a large segment of the population caused by the drought. As a result, the trade deficit decreased. Payments for services rose, apprec:Lably, but the balance on goods and services still showed some improvement against 1972. As in the years before, net inflows of grants and loans more than compensated the current deficit, producing an overall surplus. Table 6 compares 1972 and estimated 1973 developments.

Merchandise Exports 2/

55. Niger's real exports are unknown, since a substantial part (mostly livestock going to Nigeria) escapes all government control and a portion of what passes through customs (at posts other than Niamey, Maradi, and Zinder) is not registered in the trade statistics. Available estimates of unrecorded exports for recent years vary between CFAF 1.7 and 2.5 billion -- about 20-25 percent of average recorcled exports during 1967-1972.

56. Through times cf good weather and times of drought groundnuts and groundnut products remained the most important item among recorded exports in the recent past. 3/ But receipts from this source fluctuated between CFAF 6.60 billion for 191,000 tons in 1967 (77 percent of total export value), a record that has not yet been reached again, and CFAF 3.97 billion for 135,200 tons in 1969 (64 percent), the result of the first serious drought combined with a drop in average urit prices. Since prices improved considerably thereafter (nearly 30 percent in 1970 and about 10 percent in 1971 and 1972), the low volume of 113,200 tons available for export in 1971 due to another drought still produced earnings of CFAF 4.65 billion (44 percent), and in 1972 an export volume only marginally higher than that of 1969 fetched CFAF 6.18 billion (45 percent).

57. Next in importance through 1972 were exports of live animals (mainly cattle). Hovering at about CFAF 0.9 billion during 1967-1969 (12 percent on average), their value rose to CFAF 2.51 billion in 1972 (18 percent) as herders sold the animals they could no longer support because of the drought.

1/ See Statistical Appendix, Table 3.7. 2/ See Statistical Appendix, Table 3.2. 3/ See Table 7. _ 20 _

Table 6: BALANCE OF PAYMENTS ESTIMATE I973 (Millions of CFAF)

1972 1973

Groundnuts and groundnut products 6,174 5,240

Groundnuts (4,597) (2,970) Groundnut oil (1,221) (1,740) Oil cakes ( 356) ( 530)

Uranium concentrates 2,370 5,020 Cattle 2,209 2,720 Hides and skins 221 315 Cotton fibers 194 120 All other 2,544 1,795 Total recorded exports 13,712 15,210 Unrecorded exports 1,700 850 Total merchandise exports 15,412 16,060 Total recorded imports I6,576 17,500 Unrecorded imports 2,550 1,500 Total merchandise imports 19,126 19,000 Trade balance -3,714 -2,940 Net services -2,140 -2,600

Balance on goods and services -5,854 -5,540 Transfers (net) 8,750 1/ 7,300 2/ Other capital (net) 3/ 1,240 - 1,000 Errors and omissions -1,866 -1,730

Change in reserves (increase +) 2,270 1,030

1/ Nearly all public sector transfers. 2/ Private transfers assumed to be nil. 3/ Including SDR allocations. Source: Statistical Appendix, Tables 3.1 to 3.3, and mission estimates based on the first half of 1973. - 21 -

58. In 1971 a promising new export item, uranium concentrates, appeared on the scene producing receipts of nearly CFAF 2 billion (19 percent). As a result, total recorded exports, which would otherwise have declined slightly, increased by over 20 percent. In 1972 uranium exports rose to CFAF 2.37 billion (17 percent). If production and exports have developed as planned, uranium will have replaced livestock as Niger's No. 2 export in 1973.

59. Cotton fibers, the third-ranking traditional export item, experienced wide fluctuations in earnings during 1967-1972 -- CFAF 0.16 billion in 1970 (2 percent), CFAF 0.56 billion in 1971 (5 percent) -- essentially as a result of changing weather conditions. On the contrary, the group of other exports, which also consists largely of agricultural products (hides and skins, beans, onions, fresh vegetables, fish, etc.), showed a steady increase throughout the period; its value more than trebled since 1967, reaching CFAF 2.46 billion in 1972 (18 percent).

60. Over 50 percent of Niger's recorded exports went to the EEC in 1972, with France, Germany (Federal Republic), and Italy being the most important markets. 1/ In 1967 the EEC had taken up over 75 percent. This drastic decline was due to the reduction of French purchases which were halved during the period. On the other hand, Nigeria's importance as a market for Nigerien goods increased substantially; its share of total exports grew from 15 percent in 1967 to more than 27 percent in 1972. The main items sold to Nigeria are livestock, groundnut oil and cakes, onions and beans (niebe). Trade with Nigeria could be more profitable for Niger if meat instead of live animals could be exported, but a 67 percent tariff on meat makes this practically impossible. Exports to other UDEAO 2/ members fluctuated considerably, climb- ing from 4 percent in 1967 to nearly 10 percent of total exports in 1970 and falling back to just over 5 percent in 1972.

Merchandise Imports 3/

61. What has been said about exports also applies to imports: a substantial part (mainly imports of finished consumer goods from Nigeria) escapes the control of the government, entailing important losses of revenue. Esti- mates of unrecorded imports for the last few years range between CFAF 2 and 2.8 billion -- about 16-22 percent of recorded imports during 1968-1972. One source estimates the loss of customs duties resulting from uncontrolled imports at CFAF 800 million. 4/

62. Broken down by type of end-use, recorded imports during 1968-1972 presented the following picture (see Table 8): Between 40 and 50 percent

1/ See Statistical Appendix, Table 3.5. 2/ Union Douaniere des Etats de l'Afrique de l'Ouest: Dahomey, Ivory Coast, Mali, Mauritania, Niger, Senegal, Upper Volta; later transformed into the Communaute Economique de l'Afrique de l'Ouest (with Dahomey as an observer). 3/ See Statistical Appendix, Tables 3.3 and 3.4. 4/ Assuming, of course, such imports to be price inelastic. Table 7: RECORDED MERCHANDISE EXPORTS

1967 1968 1969 1970 1971 1972 a) Billions of CFAF

Groundnuts and groundnut products 6.60 4.92 3.97 5.69 4.65 6.18 Live animals 0.84 0.86 0.89 1.39 1.97 2.51 Cotton fibers 0.37 0.39 0.30 0.16 0.56 0.19

Subtotal 7.81 6.17 5.16 7.24 7.18 8.88

Uranium concentrates - - - - 1.98 2.37

Other exports 1/ 0.77 0.95 1.09 1.55 1.51 2.46

Total 8.58 7.12 6.25 8.79 10.67 13.71 b) Thousands of tons

Groundnuts and groundnut products 191.0 171.7 135.2 150.4 113.2 137.1 Live animals 18.9 20.2 20.4 32.2 44.8 59.5 Cotton fibers 2.6 2.9 2.2 1.3 4.9 1.4

Subtotal 212.5 194.8 157.8 183.9 162.9 198.0

Uranium concentrates - - - - 0.4 0.4

Other exports 1/ 15.6 19.9 15.1 23.7 12.7 14.6

Total 228.1 214.7 172.9 207.6 176.0 213.0

1/ Mostly agricultural products.

Source: Statistical Appendix, Table 3.2. - 23 - were goods entering the productive process (consommation intermediaire); in 1970 and again in 1972 thLs group reached nearly CFAF 8 billion (close to 180 percent of its 1968 value). Roughly one-third went into capital formation; its value rose to CFAF 5.4 billion in 1971 (170 percent of 1968), but fell to CFAF 4.8 billion in 1972 (little over 150 percent of 1968). Somewhat more than 20 percent (CFAF 2.4 billion in 1968, CFAF 3.9 billion in 1972) were destined for consumption, of which roughly half (60 percent in 1972) consisted of food products.

63. Among the princ:Lpal products imported, cotton textiles were the most important item; their share of total recorded imports was 18 percent in 1968 and 1969, surged to nearly, 30 percent in 1970, the year NITEX started operations, and declined to about 15 percent in the two years thereafter. Next in importance were vehicles and parts with a share varying between 9 and 15 percent, followed by mechanical equipment and parts with a share of about 10 percent -- except in 1969 when imports largely by NITEX and SOMAIR pushed it up to 17 percent. Petroleum products ranked fourth during 1968-1972. Their share, which had been 4-5 percent through 1970, soared to 8 percent in 1971 and 1972. With the recent increase in crude oil prices, a much more drastic rise must be expected in the future. Table 8 shows the development of the ten most important import items during 1968-1972.

64. Over 60 percent of recorded imports came from the EEC in the past few years, with France providing over 45 percent, followed by Germany (Federal Republic) and the Netherlands. 1/ The UDEAO countries supplied about 10 percent, of which more than half originated in the Ivory Coast. The USA accounted for about 5 percent in four out of the six years 1967-1972. Nigeria supplied only slightly more than 2 percent of recorded imports.

External Debt 2/

65. Since most inflows of official funds in recent years were in the form of grants (about 90 percent of gross inflow in 1971 and 1972), Niger's external public debt remained quite manageable. At the end of 1973, the total amount outstanding was US$116.3 million, of which US$71.4 million were disbursed and US$44.9 million still undisbursed. Debt service payments, which were equivalent to 3.5 percent of exports of goods and non-factor services in 1970 and around 3 percent in 1971 and 1972, are estimated to have been 3.5 percent again in 1973. This would be equivalent to 5.7 percent of 1972/73 budget revenue.

Foreign Aid

66. France, the European Development Fund (FED), Canada, the USA, and the Federal Republic of Germany have been the most important aid donors in

1/ See Statistical Appendix, Table 3.5. 2/ See Statistical Appendix, Tables 4.1 and 4.2. - 24 -

Table 8: RECORDED MERCHANDISE IMPORTS (Billions of CFAF)

1968 1969 1970 1971 1972 a) Breakdown by type of end-use

Intermediate consumption 4.44 5.35 7.80 6.48 7.90 Industry, transportation (4.37) (5.24) (7.65) (6.41) (7.83) Capital formation 3.15 4.61 5.20 5.36 4.83 Industry (2.19) (3.67) (3.74) (3.88) (3.55) Final consumption 2.40 2.61 3.21 3.14 3.85 Unallocated 0.25 - - - -

Total impnorts 10.24 12.57 16.21 14.98 16.58 b) Principal products

Cotton textiles 1/ 1.84 2.24 h.73 2.05 2.49 Vehicles and parts 1.54 1.10 1.95 2.21 1.90 Mechanical equipment and parts 0.94 2.16 1.44 1.47 1.41 Petroleum products 0.50 0.51 o.60 1.18 1.39 Electrical equipment 0.43 0.58 0.80 0.63 0.98 Iron and steel 0.41 0.80 1.04 0.80 0.91 Sugar 0.19 0.42 0.51 0.45 0.79 Tires and tubes 0.26 0.21 0.31 0.25 0.28 Patent medicines 0.18 0.15 0.25 0.33 0.25 Cigarettes 0.15 0.141 0.22 0.23 0.25

Suibtotal 6.44 8.31 11.85 9.60 10.65

Percent of total imports 62.9 66.1 73.1 64.1 64.2

1/ Prints and other fabrics containing at least 85 percent cotton.

Source: Statistical Appendix, Tables 3.3, 3.4. - 25 - recent years, followed by IDA and the UN. During 1968-1973, Niger obtained commitments of about US$40 million each year from these sources (see Table 9). Aid was also given by the Republic of China (irrigation), Libya, Italy, the Republic of Korea, Belgium, Tunisia (technical assistance), Saudi Arabia and others. To this must be added the drought relief provided by various countries and international organizations which according to estimates by the Nigerien authorities amounted to about CFAF 9.2 billion (US$41 million) in 1972/73. In January 1974, the EEC Commission approved additional emergency aid of about US$89 million 1/ for the six Sahelian countries 2/ (nearly four times the 1973 amount) to help cope with the effects of the persistent drought. This aid, two-thirds of which is food aid, will be distributed among the six countries in collaboration with the Interstate Committee to Fight the Drought (Comite inter-Etats de lutte contre la secheresse).

67. French aid 3/ (luring the past six years was almost entirely in the form of grants. Of the t:otal amount committed (about US$80 million) 38 percent was capital aid, 37 percent technical assistance (largely in education), and 25 percent budget aid! (including the Fonds National d'Investissement). Capital aid (about US$30 million) focussed on infrastructure and agricultural development; over one-third went into education, nearly 30 percent into agriculture, and one quarter into economic infrastructure (mainly roads).

68. All FED assistance 4/ so far has been in grant form. Highest priority was given to the development of economic infrastructure (almost exclusively roads), which received nearly half of Second and Third FED commitments and about 45 percent of total FED disbursements during 1968-1973. Next in importance were agriculture and social infrastructure with about one-fifth each of commitments and 19 and 22 percent of disbursements. At the end of 1973, the balance of undisbursed FED commitments was about US$39 million.

69. Since the start of its aid program in 1968, Canada has committed over US$30 million (on IDA terms) to finance a road project (the Route de l'Unite -- about 450 km -- between Goure and N'Guigmi; US$20 million), a Niger river navigation project (US$6.4 million) 5/, and the Nigerien portion of the transmission line between Niamey and the Kaindji dam in Nigeria (US$4.5 million). In addition, Canada maintains a widespread technical assistance program (grants) estimated at about US$1 million a year.

70. Since mid-1968, United States aid to the five Entente countries 6/ is provided on a regional basis. The program -- a combination of project

1/ 73.7 million EEC accounting units converted into current US dollars. 2/ Chad, Mali, MauritanLa, Niger, Senegal, Upper Volta. 3/ See Statistical Appenidix, Table 10.1. 4/ See Statistical Appendix, Tables 10.2 and 10.3. 5/ In connection with this project, the USA have provided US$2.3 million to raise the bridge and construct a river port at Gaya. 6/ Dahomey, Ivory Coast, Niger, Togo, Upper Volta. - 26 -

Table 9: COMMITMENTS OF MAJOR AID DONORS

(Millions of US-$)

Annual Average 1968-1973 Percent

France 1/ 13.36 33.6

European Development Fund 2/ 8.29 20.9

Canada 3/ 6.14 15.4

USA 4/ 4.05 10.2

Germany 5/ 2.92 7.4

IDA 6/ 2.83 7.1

UN 2.16 5.4

Total 39-75 100.0

1/ FAC (capital and budget aid) and direct technical assistance. 2/ Fxcluding emergency aid. 3/ Project loans and technical assistance grants. T/ Including Niger's estimated share in FY 1969-72 regional aid program. 5/ Capital aid and technical assistance. '/ Including adjustments to reflect the devaluation of the US dollar.

Source: Donor information and mission estimates (see Statisti- cal Appendix, Tables 10.1 to 10.5). - 27 -

grants and loans, technical assistance, and food aid -- concentrates on two areas: food production (cereals, livestock, and related activities) and transportation/communications links. Aid is also given for natural and human resource development and for institution building. Since 1972/73, the emphasis was on technical assistance and drought relief. For US FY1969-1972, Niger's share of total aid to the Entente states is estimated at about US$18 million, of which 55 percent were loans and 45 percent grants. Food production and transportation each received about 40 percent of the total, and somewhat less than 10 percent each went into health programs and development banking. In 1973, US$2.2 million emergency aid was committed to finance ongoing or fast-maturing projects in agriculture and health.

71. German capital aid 1/ during 1968-1973 amounted to US$12.5 million, of which about US$10.4 mLllion were undisbursed at the end of 1973. More than half of the total was for the financing of rural and urban water supply projects, nearly a quarter for a water supply and power project (Zinder), and one-fifth was commod:Lty aid. Under consideration are a sewerage project (Maradi) and three agricultural projects, for which US$10 million are earmarked but not yet formaLly committed. Over the years 1968-1973, the conditions of German aid were progressively softened; since 1972, capital aid is provided on IDA terms. The German technical assistance program (both civilian and military) is estimated at about US$5 million (grants) for the past six years.

72. IDA committed US$17.0 million during 1968-1973 for the financing of a road maintenance project (128-NIR), a small agricultural credit project (207-NIR), a road constrtction project (231-NIR), and a drought relief project (441-NIR). Of this total, US$12.2 million were disbursed at the end of 1973. 2/ An airport improvement project (Niamey) was approved by IDA's board of directors in May 1974 (US$5.0 million), and an integrated rural development project (Maradi) is under consideration.

Public Finance

73. During 1969/70-1971/72, Niger was able to generate increasing budgetary savings; the current surplus 3/ reached nearly CFAF 900 million in 1971/72 (see Table 10), equivalent to 7.3 percent of revenue. The original 1972/73 budget showed savings of almost CFAF 1.4 billion (11 percent of revenue), since current spending was held at the 1971/72 level while revenue was projected to grow as in the years before despite tax reductions (cattle tax, grazing tax) to help drought-stricken farmers and herders. But by early 1973 it became clear that this estimate was too optimistic: expenditure

1/ See Statistical Appendix, Table 10.4. 2/ See Statistical Appendix, Table 10.5. 3/ Net of total debt service, since available information does not allow to separate interest and amortization payments. - 28 - authorizations already exceeded the initial budget forecast by CFAF 380 million. Even savings of less than CFAF 1 billion, however, would be -- from a fiscal point of view -- a remarkable achievement in a drought year like 1972/73. In the 1973/74 budget plan, the current surplus was reduced to about CFAF 300 million (2.3 percent of revenue), because current expenditure was raised by about CFAF 1 billion and revenue declined slightly as the cattle tax was suspended and estimated non-tax receipts were much less than in the 1972/73 budget. At the time the budget was established, the worsening of the drought situation could not yet be foreseen; its revenue estimates appear quite optimistic now, and it seems more likely that 1973/74 will end with a current deficit than with the small surplus initially planned (see Part II - A).

74. When capital expenditures (excluding investment financed out of foreign aid) are taken into account, the current surpluses of 1969/70-1971/72 turn into deficits. Thus, in 1971/72, the overall budget deficit reached 11.4 percent of total expenditure as investment climbed, after a 17 percent fall in 1970/71, to CFAF 2.5 billion. The 1972/73 and 1973/74 budgets foresaw capital expenditures of over CFAF 3 billion each; as a result, the estimated deficit increased to nearly CFAF 1.8 billion in 1972/73 (12.2 percent of total spending) and a record CFAF 3.0 billion in 1973/74 (19.2 percent).

75. Financing for these deficits is obtained largely from abroad, mostly in the form of French treasury grants. The portion of French aid given to the National Investment Fund (CFAF 1 billion annually since 1970/71), although not having any explicit connection with the uranium mining by SOMAIR at Arlit, seems to have been maintained because Niger's receipts from the mine have fallen short of expectations so far. In the years 1969/70- 1971/72, the share of foreign financing declined from 101 percent to 63 percent of the deficit and mounted again to 85 percent. The 1972/73 budget brought the share down to 57 percent, since domestic financing was expected to contribute substantially more than in the preceding years, but in 1973/74 again the entire deficit was to be covered by foreign grants. When the mission visited Niamey, only one-third of the required amount had been committed. The most important source of domestic financing in recent years was the Caisse de Stabilisation des Prix des Produits du Niger.

76. Current expenditures increased by 5.3 percent on average between 1969/70 and 1971/72 -- a modest rate compared with that of neighboring Mali. In 1972/73, the estimated increase was only 3.5 percent and in 1973/74 it was 5.9 percent. Personnel spending, which accounted for roughly 40 percent of current expenditure growth between 1969/70 and 1971/72, was responsible for nearly 80 percent in 1972/73 and 1973/74. As a result, its share went up from 47 percent 1/ to 49 percent. The shares of all other current expenditure items, except debt service, remained practically unchanged in the period under review: each year somewhat less than one quarter was spent on

1/ Average 1969/70-1972/73. - 29 -

Table 10: GOVERNMENT EXPENDITURES AND THEIR FINANCING 1/

(Millions of CFAF)

Actuals Budget 1969/70 1970/71 1971/72 1972/73 19737

Government revenue 10,941 11,468 12,132 12,648 12,627 Tax revenue (10,414) (10,734) (11,098) (11.,251) (11,755) Non-tax revenue ( 527) ( 734) ( 1,034) ( 1,397) ( 872) Government current expenditure 10,134 10,622 11,243 11,261 2/ 12,332 Personnel ( 4,758) ( 4,879) ( 5,182) ( 5,491) ( 6,033) Materials a.nd supplies ( 2,477) ( 2,398) ( 2,523) ( 2,551) ( 2,799) Tra.nsportation ( 1,103) ( 1,400) ( 1,244) ( 1,236) ( 1,372) Debt service ( 634) ( 670) ( 742) ( 439) ( 380) Housing ( 268) ( 289) ( 348) ( 365) ( 439) Other ( 894) ( 986) ( 1,204) ( 1,179) ( 1,309)

Current surplus 807 846 889 1,387 295

Government investment expenditure 1,964 1,639 2,452 3,137 3,295 National Investment Fund ( 1,092) ( 807) ( 1,168) ( 1,616) ( 2,130) Current budget 3/ ( 872) ( 832) ( 1,284) ( 1,521) ( 1,165)

Budget deficit -1,157 - 793 -1,563 -1,750 -3,000

External financing 1,170 500 1,328 1.,000 3,000 Grants ( 896) ( 500) ( 1,328) ( 1,000) ( 3,000) Loans ( 271) - ) - ) - ) - ) Internal fina.ncing - 13 293 235 750 Contributions of public entities 4/ ( 250) ( 250) ( 200) ( 750) ( - ) Other (net) (- 263) ( 43) ( 35) ( - ) ( - )

Total financing 1,157 793 1,563 1,750 3,000

1/ The fiscal year.extends from October 1 to September 30. 2/ Expenditure authorizati.ons at the end of January 1973 exceeded the initial budget forecast by CFAF 380 million. Of this amount, CFAF 333 million represented an increase in debt service and CFAF 25 million additiona.l transportation expenditures. 3/ Part of Title IV, Government Interventions. 17/ Caisse de Stabilisatiorn des Prix des Produits du Niger (CSPPN).

Source: Statistical Appendix, Tables 5.1, 5.2, 5.4, 5.5. - 30 - materials and supplies, about 15 percent on transportation and housing, and one-tenth on other purposes. 1/ Debt service payments (mainly on domestic debt), which amounted to 6-7 percent of current spending in 1969/70-1972/73, dropped to 3 percent in the 1973/74 budget. It may well be, however, that during the year the estimate will be revised upward like in 1972/73 (see Table 10, footnote 2).

77. Broken down by ministry, current expenditures present the following picture 2/ the Ministry of Finance, which had absorbed 20 percent in 1971/72, saw its share reduced to 16 percent in 1973/74 because of the expected decline in debt service payments. The Ministry of Education, on the other hand, received 19 percent in 1973/74 against somewhat over 16 percent in 1971/72. Next in importance were the Ministries of Interior, Defense, Health, and Agriculture (Economie rurale); their shares in current spending were about 12, 9, 9, and 6 percent in both years.

78. During 1969/70-1971/72, actual capital expenditure was considerably less than had been budgeted. 3/ In 1969/70, 80 percent of the budget total of CFAF 2.5 billion was actually spent. Although the investment budget was reduced to CFAF 2.2 billion in the following year, the share of actual spending declined to 75 percent. In 1971/72, actual expenditures reached 83 percent of revised budget estimates. In view of this experience, it seems unlikely that the CFAF 3.1 billion and CFAF 3.3 billion provided in the 1972/73 and 1973/74 budgets will be fully spent.

79. Most capital expenditure included in the budget during 1969/70-1971/72 went into infrastructure (mainly roads and administrative infrastructure); its share in the total went up from 50 percent in 1969/70 to 64 percent in 1971/72 and was to stay at this level in 1972/73 and 1973/74. Participations, subsidies and loans (including Niger's participation in foreign aid financed projects) ranked second; their share fell from 23 percent in 1969/70 to 16 percent in 1971/72, but in 1972/73 and 1973/74 again 18 percent and 19 percent were budgeted for this purpose. Investment in production (mostly agriculture) accounted for 18 percent of the capital budget in 1969/70 and 15 percent in 1970/71 and 1971/72. In the 1972/73 and 1973/74 budgets, its share was 15 percent and 16 percent.

80. Total government revenue increased by 5.3 percent on average between 1969/70 and 1971/72, the same rate as current expenditure. Since tax revenue rose by only 3.2 percent because of the drought, its share in total revenue declined from over 95 percent to less than 92 percent. With tax growth lagging further behind total revenue growth (1.4 against 4.3 percent), this

1/ Essentially subsidies, contributions, and participations in international and interregional organizations. See Statistical Appendix, Table 5.2. 2/ See Statistical Appendix, Table 5.3. 3/ See Statistical Appendix, Table 5.4. - 31 -

tendency was expected tco continue in 1972/73. On the contrary, a sizeable increase of tax revenue (4.5 percent) and a slight decrease of total revenue (-0.2 percent) due to a drop in non-tax receipts were projected for 1973/74. This would raise the tax share again to 93 percent, the average for 1969/70- 1971/72.

81. The principal sources of tax revenue 1/ are foreign trade taxes (mainly on imports), income taxes (including minimum head taxes 2/), the sales tax, and consumption taxes on alcoholic beverages, tobacco and cigarettes, and petroleum products. Together, they represented between 93 and 96 percent of tax revenue and between 85 and 88 percent of total revenue during 1969/70-1973/74. Taxes on foreign trade, which accounted for an average 37 percent in 1969/70-1971/72 and 36 percent in 1972/73, were estimated to produce over 39 percent of total revenue in 1973/74. Income taxes, on the other hand, experienced a steady decline in their share from more than 34 percent in 1969/70 over about 32 percent in 1971/72 to 29 percent in 1973/74, reflecting the direct effect of the drought on incomes as well as tax reductions to help farmers and herders. The contribution of the sales tax remained around 9 percent through the period under review, while that of consumption taxes increased from less than 7 percent in 1969/70 to 9.4 percent in 1971/72 and 10.4 percent in 1973/74.

The Monetary System

82. Niger is a member of the French franc area (Zone Franc). Together with five other countries (Dahomey, Ivory Coast, Senegal, Togo, Upper Volta) it forms the West African Monetary Union (Union Monetaire Ouest Africaine, UMOA). The Union has a common currency, the CFA franc, issued by a common central bank, the Banque Centrale des Etats de l'Afrique de l'Ouest (BCEAO), which maintains an agency in each member state. The CFA franc is freely convertible into French :Erancs at the rate of CFAF 50 = FF 1 (CFAF 1 FT 0.02). Monetary policy for the Union is determined by the Board of Direc- tors (Conseil d'administ ration) of the BCEAO under the guidance and supervision of the Council of Ministers (Conseil des ministres) of UMOA. The Board is assisted in each member country by a National Credit Commiittee (Comite national du credit). Rediscount ceilings are the main instrument of credit policy employed by the BCEAO.

83. The rules of operation of the UMOA are laid down in the Treaty of November 14, 1973, which replaces the Treaty of May 12, 1962, that had established the Union, and three related documents: (i) the revised statutes of the BCEAO, annexed to the Treaty; (ii) the new Cooperation Agreement between the IMOA states and France, signed on December 4, 1973; and (iii) the agreement, signed on the same date, concerning the Operations Account (compte d'operations) maintained by the BCEAO with the French Treasury, which is the mechanism through which the convertibility of the CFA franc into French francs is assured. The new legal framework is the result of the member states' endeavors to obtain more independence from France in monetary matters than in

1/ See Statistical Appendix, Table 5.1. 2/ Impots forfaitaires sur les revenus (Title I, Chapter 102 of the budget). - 32 -

the past while retaining the French guarantee for their common currency. The principal innovations are the following.

84. The UMOA Treaty establishes a Conference of Heads of State (Confe- rence des chefs d'Etat) as the highest authority of the Union. The Conference grants admission to new members, takes formal note of the withdrawal or expulsion of members, determines the seat of the BCEAO, and settles all questions which are submitted to it by the Council of Mlinisters or which cannot be decided unanimously in the Council. Its decisions also require unanimity. The Conference gathers at least once a year; it is chaired by the head of state of the host country which changes every year in alphabe- tical order.

85. In the Council of Miinisters each member state is now represented by two ministers instead of one (one being the Mlinister of Finance), but each delegation has only one voice. The Council meets at least twice a year. As the highest organ of the BCEAO it defines monetary and credit policies to be followed, approves international agreements entered by the BCEAO, and now has the power to change, by unanimous vote, the parity of the CFA franc. It can also request the BCEAO to create or participate in financial institutions that foster the development and integration of the UMOA. Making use of this provision, the member states have decided to establish a West African Development Bank (Banque Ouest Africaine de Developpement., BOAD).

86. The seat of the BCEAO, until now Paris, will be moved to Africa. Its Board of Directors, which since the withdrawal of Mauritania from the UMOA consisted of 12 African and 7 French members, now has 12 African and 2 French members (two per country). Instead of a French managing director (directeur general) whose term was unlimited, the BCEAO now has an African Governor and Deputy Governor wlhose terms are fixed; the positions will be filled in turn by nationals of each member state. Central bank credit to member governments, under the old statutes limited to 15 percent of fiscal receipts in the preceding year, can now be extended up to 20 percent. The maturity of medium-term paper acceptable for rediscounting has been raised from 7 to 10 years. Finally, the percentage of its foreign assets the BCEAO does not have to deposit in the Operations Account has been increased to 35% since June 1967 it was already possible for the BCEAO to invest part of its foreign assets in certain types of negotiable bonds, maturing within two years, issued by international organizations of which all UMOA countries were members; the BCEAO has made use of this possibility by taking up short-term IBRD bonds.

87. Besides the agency of the BCEAO in Niamey, the banking system consists of one commercial bank (Banque Internationale pour l'Afrique Occidentale), three development banks (Banque de Developpement de la Republique du Niger, BDRN; Caisse Nationale de Credit Agricole, CNCA; Credit du Niger), a savings bank, and the postal checking system. The Treasury also performs certain banking operations, essentially by accepting customs duty bills. The French Caisse Centrale de Cooperation Economique (CCCE) extends medium- and long-term credit in Niger and acts as the authorized agent of FAC and FED for local aid disbursements. Tablell: CHANGES IN FACTORS AFFECTING MOlEY SUPPLY (Millions of CFAF)

Outstdg. Annual Change Outstdg. End-1963 1969 1970 1971 1972 End-1972

Foreign assets, net 6 1,8h0 2,743 4,480 2,184 11.253 Of which- Central bank ( 580) (1,259) ( 3,2h1) ( 3,500) (1,973) (10,553)

Domestic credit 10,295 - 376 -1,459 -1,786 135 6,809 Credit to the public sector, net ( - 531) (- 0) (-1,42L) (-1,495) (- 9h7) (-4,h37) Credit to the private sector (10,826) (- 336) (- 35) (- 291) (1,082) (11,2h6) Less:

Time and foreign exchange deposits 561 - 112 21 241 74 785 M< foreign borrowing of development banks 639 h96 180 ihi - 86 1,370 Other items, net 1,857 - 21 790 571 1,509 L,513

Money supply 7,2Lh 1,29h 293 1,7h1 822 11,394 As percent of GDP 7.6% 10%

Source: Statistical Appendix, Table 6.1. - 34-

Recent Monetary Developments

88. Between 1968 and 1972 net foreign assets -- mostly of the central bank -- rose sharply from CFAF 6 million to CFAF 11.3 billion (US$ 44.6 million), while domestic credit declined from CFAF 10.3 billion to CFAF 6.8 billion (-9.8 percent a year), because the public sector -- central government, local governments, and various public entities, notably the Caisse de Stabilisation des Prix des Produits du Niger (CSPPN) -- steadily improved its net creditor position toward the banking system and credit to the private sector nearly stagnated. Since other factors also worked to offset the expansionary effect of the increase in foreign assets, the growth of money supply averaged only 12 percent a year. Table 11 summarizes recent developments. In 1973, the growth of foreign assets was halved compared with 1972 while credit to the private sector expanded strongly, resulting in a growth rate of money supply of nearly 20 percent. But the ratio of money supply to GDP, although it has increased moderately- in the past few years, is still only around 10 percent, which is low even by African standards (Mali 18.5 percent, Senegal 14.8 percent, Upper Volta 12.9 percent), and reflects the low degree of monetization of the economy.

89. Most credit to the private sector is short-term; however, its share declined from 80 to 70 percent between 1968 and 1972, while that of medium- and long-term credit increased correspondingly. Main credit users are commerce, industry, and construction; together, they accounted for over 70 percent of total credit outstanding in 1968-1972. This share remained practically constant during the period, but the portion of commerce declined from over 50 percent to slightly less than 30 percent, whereas that of industry rose from less than 10 percent to nearly 30 percent. Agriculture received only about 1 percent of total credit extended to the private sector. Among sources of financing, the development banks play by far the most important role (58.4 percent of private credit at the end of 1972), followed by the Banque Inter- nationale pour l'Afrique Occidentale (16.3 percent) and foreign financial institutions (12.2 percent). 1/ In fact, the Banque de Developpement de la Republique du Niger has become more important as a commercial bank than the Banque Internationale pour l'Afrique Occidentale. The near stagnation of private credit in the face of a liquid banking system reflects more the lack of suitable credit possibilities than an overly restrictive central bank policy -- this policy is the same as in other UMOA countries and, in particular, does not limit the financing of agricultural activities.

Prices

90. The two price indices existing in Niger are an "African" and a "European" consumer price index for Niamey. 2/ The African index is based on the consumption pattern of unskilled workersT families (July 1962 - June 1963 = 100), the European index on that of French technical assistants' families (November - December 1964 = 100).

1/ See Statistical Appendix, Tables 6.3 and 6.4. 2/ See Statistical Appendix, Tables 9.1 to 9.3. - 35 -

Table 12: PRICE INDICES

1969 1970 1971 1972 1973

African consumer prices 125.2 126.6 132.0 144.8 161.8 Annual change (percent) 10.2 1.1 4.3 9.7 11.7 Of which: Food prices 134.0 130.1 137.8 163.1 194.0 Annual change (percent) 17.7 -2.9 5.9 18.4 18.9

European consumer price!; 122.4 127.7 132.3 135.0 138.0 Annual change (percent) 1.8 4.3 3.6 2.0 2.2 Of which: Food prices 117.7 122.9 128.4 133.3 139.0 Annual change (percent) 2.3 4.4 4.5 3.8 4.3

Source: Statistical Appendix, Tables 9.1 to 9.3.

91. In 1970 the Af'rican index rose only slightly, since there was a decline in food prices brought about by the relatively good 1969/70 crop. With recurring bad weather in 1970/71, food production dropped and food prices increased nearly 6 percent; the general index went up over 4 percent. The increase in food prices continued in 1972 at a greatly accelerated pace despite some improvement: in production, which is in part explained by the fact that after several years of less than normal crops stocks were low and their replenishment reduced market supplies. The general index rose nearly 10 percent. The generaL price increase was almost 12 percent in 1973, chiefly because of another sharp rise in food prices due to the 1972/73 drought, and it must be feared that ,his trend continued during the first half of 1974.

92. Since about 7() percent of the articles included in the European index are imported, one would expect it to reflect more the changes in import prices than those of locally produced goods and services. But contrary to the strong upward movement of import prices of less developed nations, and contrary to the African index, it showed a downward tendency in 1970-1973. Details are given in Table 12. - 36 -

PART TWO

DEVELOPMENT PROSPECTS

93. To a very large extent the current situation is the result of external and unpredictable factors, the most important and most unfavorable being the drought. The dramatic rise in petroleum prices and, of more weight in the case of Niger, the accelerated inflation of import prices is another one. These two sets of influences largely determine the short term outlook. At this time, fortunately, the country's financial position is relatively strong and this, within the framework of the West African Monetary Union, should prevent the occurrence of a liquidity crisis.

94. As to the longer term, there are some favorable factors. One is the relative optimism now prevailing as regards commodity prices of special importance to Niger such as groundnuts, cotton and livestock. Another lies in the country's uranium resources that naturally attract, as indicated earlier, considerable interest from abroad. Another one still, is the generally very sympathetic attitude of external sources of aid and possibly the active involvement of friendly Arab Governments in this predominantly Moslem country.

95. While the country now finds itself in an unusually weak economic position because of the short run factors already mentioned, the nature of the long run problems has not changed. These are formidable ones and basic- ally stem from the conjunction of population growth in respect to geographical configuration, unpredictable climate and mediocrity of agricultural resources, including water, and the country's high degree of economic dependence upon external factors generally out of Government's control.

96. First, the short term outlook is assessed from the point of view of rural incomes and internal and external finances (A); the long run problems are then analysed in terms of the major constraints (B) and the Government development policies (C) while a development strategy is broadly outlined and its main components and impact tentatively quantified (D). The central problem and the thrust of the development effort concern the agricultural sector to which volumes two and three of this report are devoted.

A - The Short-Term Outlook - 1974 and 1975

97. The first part of this report has shown that in the recent years, until 1972, despite mediocre climatic conditions, the main economic aggregates have not regressed notably; the value of exports has even increased thanks to more favorable world prices. In 1972, however, large sections of the rural population were hit by a serious food crop deficit. Meanwhile both the internal and external financial position remained strong. Following the rainfall deficit of 1973, the crop failure has taken a far more serious character: on the one hand the cereal deficit has been worse than in the previous year, and 37 - except in a few areas in the South, farmers have run out of food reserves; on the other hand the groundaut and cotton crops have been so catastrophic as to preclude any significant exports of these products in 1974. Also, livestock losses appear to have been worse than first thought and, at the eve of the 1974 rainy season, the herders have been left with about half the number of cattle they had in "normal times". 1/ Favorable export prices for 1974 have therefore become largely irrelevant to Niger.

98. Aggravating factors have been the continued rise in European export prices 2/ -- by 24% in 1973 relatively to 1972 -- and the increase in petroleum prices. In the absence of data relating directly to Niger, it can be estimated that the unit cost of refined petroleum products (there is no refinery in Niger) to the country has at least doubled in the first quarter of 1974, relatively to the pre-September 1973 level. This is based on an investigation of the case of neighboring Upper Volta where the pattern of demand, and transport conditions are similar.

99. In 1974, therefore, it is more than likely that, in the first instance, real incomes of the population will be seriously reduced and that the financial equilibrium will be upset. The final outcome will then depend on the force of compensating factors: the availability of external aid and the use of resources under the Government's command.

100. Predictions about 1975 (or for that matter for any particular future year) are extremely uncertain because of the annual pattern of Niger's crops. It is only possible therefore, taking into account the likely situation at the end of 1974, to imagine E!more or less favorable situation in 1975 assuming a good or bad crop for 1974/75 on the basis of an assumed satisfactory or deficient rainfall in June-Oc:tober 1974.

General Outlook - Rural Incomes

101. The drought will have two different effects on rural incomes. It will decrease the real and money income of the rural population overall, and it will cause sharper income inequalities. The loss of real income due to the foodcrop deficit is, of course, more meaningfully measured in physical terms. In conventional niational accounts terms, the 1974 cereal deficit of 25-30 percent of a "normatl" crop represents only a few percentage points decrease in GDP -- perhaps 5-6 percent -- and consequently a 10-12 percent decrease in agricultural value added. But clearly, the impact on living standards is far more prcfound; it is indeed of a different nature. It means threat of starvation to those -- about one million people -- living at the northern fringe of the sedentary cultivation area where the crop has been practically nil, and serious shortages for those in the southern belt especially in the central and eastern region -- about 2.5 million people -- , whereas the effect in the extreme southwest -- north of Dahomey's border -- where about 0.5 million people live, has been much less.

1/ Compare Table 4, Part I. 2/ The best approximation to a non-existent import price index for Niger. - 38 -

102. It should be noted in this connection that the exceptional food import requirements of 300,000 to 350,000 tons for 1973/74 are a minimum considered necessary to avoid widespread famine but do not fully compensate for the actual crop deficit -- variably estimated between 400,000 and close to 500,000 tons -- and are not enough to permit rebuilding farmers' stocks.

103. Cash incomes of the farming population from the two main sources groundnuts and cotton, -- with average crops of 200,000 tons and 10,000 tons respectively -- would have been in the order of CFAF 4.5 billion ($18 million). About 10 percent of the cereal crop is normally marketed representing some CFAF 2 billion. Livestock sales, in turn, yield CFAF 3-4 billion each year. Other agricultural sales produce perhaps another CFAF 1-2 billion. Total cash income of the rural population is thus "normally" about CFAF 11-12 billion (or 25 percent of agricultural GDP). A reasonable guesstimate is that in 1973/74 this figure will be reduced by two-thirds. The worst hit sections in this respect are the groundnut and cotton producers and their families -- about 1.5 million people in the Maradi and Zinder areas whose sales will be practically reduced to zero. Some herdsmen may still have obtained some income from sales to Nigeria, but at the cost of further depleting their only capital -- livestock; for tens of thousands others who lost all their animals, survival has meant becoming refugees in camps or provisional settlements near Niamey and other urban centers. On the contrary, since the drought affects regions very differently, the fortunate farmers who have any saleable surpluses greatly benefit from the general shortage, especially of cereals whose prices in Niamey and other consuming centers have multiplied two-, threefold or more. The merchants involved in this trade naturally benefit also. It is not sur- prising, therefore, to find side by side now situations of extreme impoverish- ment and of sudden wealth (relatively speaking) against a background of widespread mediocrity.

104. It is all too easy to predict the effects of another drought on the 1974/75 crops: most probably, the export crops would again be relatively more affected because farmers have clearly expanded the area under food crops at the expense of others. Livestock could suffer relatively less as the bulk of the surviving herd has already moved south, including to Nigeria, and herdsmen presumably will not have returned to the northern pastoral zone before the rainy season, as is usually the case. With a cattle population already reduced by half the problem of sharing the agricultural land in the south with the sedentary population will be less intractable and conflicts between sedentary and nomadic herdsmen hopefully less acute. On the other hand, if, despite the farmers' effort to expand the area under food crops, these are again in short supply, it will be again for international aid to supply emergency food relief. Not only the economic but also the psychological impact on people becoming used to a state of mendicancy would be plainly disastrous.

105. On the other hand, for the reason given, even a good rainy season in 1974 will still probably result in a modest groundnut and cotton crop while producing a large crop of cereals and other foodstuffs. This should then permit farmers to rebuild their reserves and the Government cereal marketing - 39 -

organization -- OPVN 1/ -- to start building up its own buffer stocks and thus move from its role of distributor of imported food to the one for which it was primarily intended: to sattenuate interseasonal supply and price fluctuations and regional disparities.

Budget

106. The original budget for 1973/74 (see para. 73) was based on a projected slight decline in revenue over the 1972/73 estimates and against an actual average increase of 6 percent during the previous 5 years. With current expenditures expected to increase by 1 billion over 1972/73 estimates, the current surplus was to decrease drastically from about CFAF 1.4 billion to less than CFAF 300 million. These estimates took into account the suspension of the cattle tax (CFAF 610 million in 1971/72) decided by the Government to alleviate the burden of drought-stricken herders but neither the full extent of the catastrophic rainfall deficit of 1973/74, nor the oil crisis and the accelerated pace of world inflation could have been foreseen.

107. In view of these developments it is reasonable to predict (a) a sharp reduction in proceeds from export taxes that are based mainly on groundnut products and cotton, or less CFAF 600 million (against budgeted receipts of 817 million), and (b) a reduction in receipts from income (poll) tax on farmers that will be extremely difficult to collect, or less another CFAF 600 million (or about 30 percent of budgeted revenue of CFAF 1.9 billion). Further- more, it is unlikely that revenue from import taxes will increase much since demand for imported consumer goods will hardly increase because of reduced cash incomes of the rural population and higher prices of imports. Assuming that the value of such imports does not decline (in other words, assuming that higher prices compensate for smaller quantities or that the price elasticity is about one) the revenue on this count should not change much. Taxes on petroleum products are in fact specific rates (not ad valorem) and quantities imported will not grow much if at all. Of course, exceptional food imports are tax free and capital goods and goods financed through foreign aid usually pay little or no taxes.

108. In the past, the Government has been rather efficient in limiting expenditure growth but the new Government may-not wish to impose further austerity measures, espec:Lally on wages and salaries, so soon after coming to power and in view of the current difficult situation. It would be difficult also, in view of the inflationary movement of import prices, to much reduce -- if at all -- budgetary expenses on goods and services. Assuming therefore a level of current expenditure in line with the budget estimates, the current budget could show a defic.Lt of about CFAF 900 million against a budgeted surplus of CFAF 300 million.

109. Investment expenditure in the budget (in FNI 2/ and also in the current budget) is usually overestimated and the Government might also decide to postpone some nonessential items of capital outlays. Instead of a budgeted

1/ Office des Produits Vivriers du Niger. 2/ Fonds National d'Investissement. - 40 -

CFAF 3.3 billion, a level of CFAF 3 billion, or still 0.5 billion more than in 1971/72 to take account of unit cost increases, may be assumed. Financing items in the 1973/74 budget estimates include CFAF 1 billion from France (grant), CFAF 2 billion (grant) from unspecified sources, and no internal resources. The French grant can be considered as secured; nothing can be said about the other external grants, and indeed internal sources of financing may well be discounted since the most important one -- the export price stabilization board (CSPPN) -- will have little or no revenue out of exports.

110. For the 1974/75 budget, two situations are possible as mentioned earlier. In the favorable case, one may assume that revenue from income taxes will pick up again, but exports may well recover much less and the cattle tax is unlikely to be re-imposed. Other things equal, revenue could be CFAF 600-800 million more than in 1973/74. If expenditure is stabilized -- a difficult task because the inflationary trends are expected to continue --. there could be a near balance in the current budget. In the unfavorable case of a persisting drought, the current deficit could, at best, be about the same as in 1973/74. Assuming further that in 1974/75 the Government will seek to maintain budget investment at around CFAF 3 billion, the overall deficit would also be the same. The following table summarizes the main magnitudes:

Table 13: SHORT-TERM OUTLOOK - GOVERNMENT BUDGET (Billions of CFAF)

1974/75 1973/74 "favorable"

Revenue 11.4 12.2 Current expenditure 12.3 12.3

Current balance -0.9 -0.1

Investment expenditure 3.0 3.0

Overall balance -3.9 -3.1

Financing - assured 1.0 - other 2.9

11l. Ilie treasury's cash position toward the end of 1973 was comfortable with gross liquid assets of about CFAF 4.5 billion and a net creditor position with the banking system of CFAF 3.8 billion. In case of need the Government could also borrow from the central bank up to 20 percent of the previous year's tax revenue -- or about CFAF 2 billion. There is no danger therefore of a liquidity crisis. However, it would be a most unwelcome setback if the Govern- ment had to have recourse to the central bank facility: it would mean a brutal return to a situation of financial difficulty that it had taken six years of painful efforts to reverse. Apart from the French subsidy (CFAF 1 - 41 -

billion), other possible contributions that were contemplated at the time the mission was in Niger were one from FED to compensate for the loss of revenue on account of the cattle tax and others from "friendly countries", possibly Arab states.

Balance of Payments

112. Lack of recent estimates makes the assessment of the external balance difficult. For 1974 the adverse impact resulting from the export crop failure will no doubt be very serLous. Groundnut and cotton exports may be practically discounted -- except for some exports by the end of the year if the next crop permits this, and possibly also some sales of oil and cakes from existing stocks if the Government authorizes such sales again. A big unknown is livestock. On the one hand, the herd hati been so depleted that further sales would only com- plicate its future reconst:itution to "normal" levels, especially as this would now mean increased sales of young female animals. The Government's aim is to prevent this from happening. On the other hand, herdsmen may be forced to sell to obtain some cash. The need for cash, now that taxes on livestock have been suspended, will depend on the degree to which herdsmen will have to pay personal taxes and will have to purchase food from the market where prices are exceptionally high. This in turn will depend on the efficiency of relief food distribution. Other exportable agricultural products have also been affected by the drought; obviously meait, hides and skins are a case in point.

113. The only bright point on the export side relates to uranium. Hav- ing installed its full capacity equipment, SOMAIR could conceivably export some 1,500 tons of concentrates in 1974. However, the company may wish to dispose of existing stocks while avoiding a too rapid increase in quantities offered, especially at a time when the question of future prices is to be renegotiated. Assuming sales of 1,250 tons as previously planned by the company for 1974, and an unchanged price, the value of exports would be around CFAF 6 billion, against CFAF 5 billion in 1973.

114. For 1975 a further increase in export volume of uranium, to 1,380 tons, is also part of the company's plan. What prices will then be is impossible to say. Two assumptions -- same level as 1973-1974 (assumption (a)) and 50 percent increase (assumption (b)) -- are made here, but since press reports mentioned a fourfold increase in price as the (former) Government's objective in the negotiations that w,ere to take place on this matter with France, the margin of uncertainty is indeed very large. One central issue is, therefore, to what extent uranium exports will compensate for the fall in agricultural exports.

115. Another one relat:es to imports for which four main factors will be at play: (i) the oil bill will double on account of price increases alone; in addition, volume imported should again increase as a result of the stepping up of operations of the urtnium mine (a large consumer of gas oil) and the distribution of relief food imports throughout the country: the volume involved is larger than that of the "normal" groundnut crop; (ii) food imports expected to be about 250,000-300,000 tons are, of course, a special item though it is hoped that they will entail little or no foreign exchange cost - 42 -

to Niger; (iii) general price rises of other imports forecast to be about 14 percent in 1974 and 11 percent in 1975 in line with projected world rates of inflation; (iv) on the other hand, the volume of consumer goods imports other than food should be depressed by the fall in rural incomes in 1974 and could increase again moderately in 1975 assuming a revival of agricultural exports and incomes. The goods most likely to be affected, however, fall under the category of "unrecorded imports", mainly border trade with Nigeria, representing approximately 15 percent of total merchandise imports.

116. The third major issue in the external balance relates to the volume of aid. Previous commitments as well as new ones make it very likely that the level of aid attained in recent years - about CFAF 10 billion - will be at least maintained over the next two years. Additional aid in the form of food and related supplies for 1974 is expected to be in line with expressed requirements. Its money value may be only slightly more than in 1973, though physical volumes of food required are much larger, because their transport to and distribution within Niger is expected to be much less costly since air- lifts should not be needed this time. 1/ It is assumed that no such aid will be needed in 1975. In any case, to the extent that food aid grants match corresponding imports, their net effect on the overall balance of payments is nil.

117. Based on the foregoing discussion, a summary picture of the balance of payments is presented as a very tentative forecast in Table 14 below; 1972, the last year for which figures are available (see Statistical Appendix, Table 3.1), is taken as reference.

118. In 1974 the impact of the adverse factors -- weather, oil prices, inflation -- could result in a loss of reserves of about CFAF 7 billion ($28 million), a sharp reverse of the trend in the six previous years when reserves increased by CFAF 12 billion ($48 million). Reserves (net) exceeded CFAF 11 billion at the beginning of 1974 and the projected decline should therefore be easily absorbed and still leave reserves equivalent to 2-3 months imports. Besides, barring another drought in 1975, the normal recovery of agricultural exports and the growth of uranium exports should permit to recover two-thirds of the loss with an unchanged uranium price and the totality if this price is renegotiated at a 50 percent higher level. On the contrary, another crop failure in 1975 could easily mean a reduction of foreign exchange reserves to zero or make them negative, as they were in 1968 -- unless uranium prices could at least be doubled. However, the only conclusion that should be drawn with some confidence from this summary analysis is that Niger's internal as well as external financial position at this juncture has become a fragile one.

1/ It is difficult to value food and related aid (medicine, supply of trucks, relief teams, etc.) at this stage. A reasonable approximation is to assume an intermediate figure of 300,000 tons of food at an average of CFAF 40,000/ton, which is the estimated cost of US sorghum delivered at Niamey. - 43 -

Table 14: SHORT-TERM OUTLOOK - BALANCE OF PAYMENTS (Billions of CFAF)

1972 1974 1975 (a) (b)

Exports of goods Agricultural products & misc. 14.0 2.5 14.0 14.0 Uranium 2.4 6.0 6.9 10.4 Total 16.4 8.5 20.9 24.4

Imports of goods Petroleum 1.3 3.1 3.7 3.7 Other 18.7 19.5 20.6 20.6 Relief food - 12.0 - - Total 20.0 34.6 24.3 24.3

Services Li, net -2.2 -3.0 -3.0 -4.0

Current balance -5.8 -29.1 -6.4 -3.9

Public transfers, net Normal aid 8.7 10.0 11.0 11.0 Food aid - 12.0 - -

Capital Public, drawings 1.3 1.5 1.8 1.8 Public, repayments 0.9 0.7 1.0 1.0 Public, net 0.4 0.8 0.8 0.8 Private, net 0.4 0.5 0.6 0.6 Transfers and Capital, Total 9.5 23.3 12.4 12.4

Other items -1.4 -1.0 -1.0 -1.0

Overall balance 2.3 -6.8 5.0 7.5

/1 Including factor services and private transfers.

B - The Longer Term Outlook - Constraints

Natural Constraints

119. All developing countries face constraints of a kind or another, but few face so many and so sierious obstacles to development as Niger. Natural constraints result from the geographical situation and size of the country, and from the vagaries of the weather. Distances, both internally and to the sea ports, impose high transport costs both financial and in terms of - 44 - delays, the latter being sometimes more damaging than the former. High transport costs decrease Niger's net export proceeds and weaken its position vis- a-vis competitors on the same market, principally Nigeria and Senegal for groundnuts and groundnut products. Thus transport cost of the groundnut crop to export ports (Lagos, Cotonou) is seven times higher than in Senegal. This, of course, is one of the reasons why this latter country can afford to pay producers a price 100 percent higher than in Niger.

120. High transport costs also weigh on the cost of imports. This could represent a natural protective barrier favoring development of import substitution industries. This factor, however, works very little for two main reasons. One is that there is practically no line of production -- except pure traditional subsistence agriculture -- that can dispense with imported inputs, be it fuel, semi-finished products, parts, fertilizers and pesticides, or consumer goods regarded as necessary incentives by farmers. The second reason is that the local market is so narrow and so fragmented by internal distances and transport costs, that few units of production of economic size can be viable. On the other hand, export industries that would tend to reduce the relative weight of transport costs in the cost price of processed products meet other obstacles (see para. 133 below).

121. Adverse climatic factors need not be stressed at this time of drought, nor the fact, more dramatically visible every day, that of the Sahelian countries Niger has been most seriously affected by the disastrous rainy season in 1973. It may be recalled, however, that the current drought has historical precedents (1913-16, 1942-44, 1955-56), though apparently not of such a long duration. Even if the current situation is not the beginning of a trend of increasing aridity in the region, "accidental" droughts are certainly part of the "normal" climate and therefore pose the problem of how to prevent or mitigate their effects on agricultural production in general and food supplies in particular. On the other hand, even if serious droughts do not occur, the normal, i.e. average climatic conditions in terms of rainfall, evaporation, winds, etc., are only moderately favorable in very limited areas (the most southern regions north of Dahomey with annual rainfall up to 800/900 mm), mediocre in the greater part of the southern belt (up to 500 mm rainfall) and truly marginal further north, say up to the 300 Tm limit, where farming has expanded over the years under the pressure of population growth, and competes with livestock for the scanty resources of that region. This, of course, is the area worst hit by the drought and from which people have massively emigrated in the last two years.

122. To palliate irregular and deficient rainfall the use of surface and groundwater is a possibility. This, however, presents difficulties in Niger. Large amounts of groundwater, some at great depth, are known to exist in the pastoral zone, but no complete survey of this resource has been made yet and, above all, its use would be very costly. Though of interest for supplying wells, especially for livestock, groundwater resources do not seem, at the present stage of technology, to offer economical prospects on a large scale. On the other hand, surface water and irrigable land resources are limited. - 45 -

123. The Niger river valley offers about 30,000 ha of lowlands ("depres- sions") of good soil at stream level, and 20,000 ha of highlands ("terrasses") also suitable for irrigat:ion though generally of lesser soil quality. The main limiting factor, however, is water itself because the minimum discharge of the river -- that fortunately, occurs during the rainy season in June/July -- is small and variable (atsolute known minimum, June 1973: 3 m3/sec; median of minima: 41 m3/sec). Consequently, it is estimated that the irrigation potential on the river (based on water requirements for two crops of rice) with a reasonable assurance of adequate water availability is no more than 15,000 ha to 18,000 ha. Beyond that limit regulation of the river by a large dam would be necessary. A site for such a structure has been identified at Kandadji near the Malian border, but the constraint that this situation imposes is evident from the (roughly) estimated cost of such a dam: about $100 million. This dam would have a potential for electricity production, and the regulation of the river would serve navigation.

124. Other water resources exist in the Komadougou valley (east), the Maggia (center), the dry valleys ("dallols" and "goulbis") where shallow groundwater is easily accessible, around lake Chad and in the Telak and Erhazer plains (in the southern fringe of the Sahara), representing a total of about 100,000 ha. However, whereas the Niger river would normally permit double cropping, this would be difficult in the other regions. Besides, parts of this potential are not readily accessible (east, Sahara).

Population Problems

125. The climate and other physical obstacles -- lack of water. mediocrity of soils, access difficulties -- are factors to which a given population can adapt itself, as Niger's and African history in general well demonstrate. The problem takes new dimensions, however, with demographic expansion. Though population growth is a readily recognized fact, its pace is the subject of an unusually large number of estimates; annual rates of or close to 2.2, 2.5, 2.7, 2.9, 3.2 and 3.6 percent have been found in various documents. If for no other reason, a population census has wisely been planned by the Government, under ECA 1/ auspices, for 1974 or 1975. The statistical uncertainties in this domain also make the Government understandably cautious in its approach to the population problem. In any event, in a strongly traditional country where Moslem influence is widespread, a country the total population of which is very small by international standards -- compared with the 65 or 80 million in Nigeria, for example -- and which is geographically so vast, the notion of a population problem that by its nature is a slowly evolving phenomenon is not readily accepted.

126. There are serious indications, nonetheless, that a problem already exists and that it will be a central issue for the long-run development of the country. Whatever the exact figure, it is certain that the rate of population growth is high: twenty years from now -- a short span of time in relation

1/ Economic Commission for Africa (UN). - 46 -

to the development problem -- Nigeriens will be 55 percent (2.2 percent p.a.) to 70 percent (2.7 percent p.a.) more numerous than now (see Statistical Appendix, Table 1.4). The question is: how can the additional 2.4-3.1 million people be decently fed, kept reasonably healthy, be properly educated, and gainfully employed? If clearcut answers to these questions could be given, Niger's development strategy would ipso facto be determined. This cannot be done, but the following considerations, though certainly incomplete, are rele- vant to the shaping of such a strategy.

127. The agricultural problem, and above all the supply of foodstuffs, is becoming more and more one of a growing imbalance between population and land. People/land relationships are not easily quantified and existing statistics are very deceptive in this respect in that they would lead to think that there is still plenty of land suitable for agricultural production. Indications are indeed to the contrary. The best agricultural areas are already densely populated and fallowlng periods, an essential factor with the current and foreseeable state of farming techniques, are becoming shorter and shorter; as a rough yardstick, areas with a population density of 30 inhabitants/km2 or more can be considered as practically saturated. The districts of Maradi, Tessaoua, Birni N'Konni, Bouza, Magaria and Matameye, representing perhaps 80 percent of all good (or reasonably good) land, with about 1.2 million people, are in that situation. At the same time, population movements towards the north have slowly but continuously taken place over the years. Thus, some 1.5 million people live in areas where "normal rainfall" is less than 500 mm and particularly erratic and where soils are generally mediocre and the danger of over- cultivation and overgrazing is serious. Indeed, one reason why the current situation is so dramatic is because population in the areas most exposed to drought is perhaps two or three times larger than, say, 30 years ago.

128. Problems arise also, quite independently from the drought, from the age structure of a fast growing population. Persons under the age of 15 form 45 percent of total population. Each Nigerien at working age (15-59 years), and assuming that all work productively, has to support another fellow citizen; in a typically developed country the ratio is closer to 1:0.5. The demographic structure, therefore, imposes a heavy burden on the productive sector. The social cost of this is the more readily visible in the field of education. As noted earlier (Part I, para. 46), the very low school attendance of 14 percent and the actual education system already absorb about 20 percent of Government current expenditure. Thus, with population growing at 2.7 percent p.a. it would take 25 years to reach a school attendance rate of 52 percent, and this would then absorb 50 percent of Government revenue assuming budgetary resources to grow by 5 percent p.a. in real terms, which is probably optimistic. This, in any sense, is an impossible prospect. While it points to the need for educational reform, of which the Government is well aware, the dimension of the problem is such, with continuing demographic expansion, that it may be wondered if any solution is at all conceivable (see para. .126 above). - 47 -

129. The employment problem is of a different kind, but no less serious. The basic consideration h,ere is that no imaginable development pattern could, over the foreseeable future, permit to absorb any significant proportion of the increase in the labor force into non-agricultural sectors. Between independence and the present time! salaried employment has grown by 20,000 people only. The Government sector clearly is constrained by revenue considerations and, besides, requires qualitative improvement rather than increased numbers of personnel. There are no known projections of employment in the private sector, but it would be unreasonable to expect that anything but a minimal proportion of the additional labor force will be able to find jobs in private or mixed enterprises though these should, and no doubt will, represent a growing sector. Unemployment among primary school leavers is already high and holders of secondary degrees are probably already exceeding the number of available vacancies. To sum up, the essence of the problem lies in the fact that while non-agricultural activities may gainfully employ hundreds, or at best a few thousand more persons each year, the annual increase in population at working age is 40,000-50,000.

130. This kind of situation is not peculiar to Niger, however. What makes the problem much more serious here, at any rate potentially, is the possibility of exc£ss population relative to land on a national scale. Widespread signs of this sort of situation exist already as noted earlier. Labor intensive techniques (relative to land, not to capital), irrigation being the prime example, may both help reduce fluctuations in production and increase productive employment. Roughly, one hectare of irrigated land with double cropping will provide work and income for a family of 6-7 people that would otherwise need perhaps 12-14 hectares. Assuming then, for reason- ing purposes, that the irrigation potential of 150,000 ha is effectively developed over the next 20 years (with 50,000 under 2 crops and 100,000 ha under one crop) -- an optimistic hypothesis -- the resulting additional employment provided would take care of 100,000 families or 600,000 - 700,000 people (including non-working persons), whereas the additional population will be at least 2.4 million (para. 126). The trend in climate (if any) is also an important consideration, since a southward shift of the 300 mm rainfall line amounts to withdrawing land from cultivation altogether.

131. Of course, ruraL unemployment due to relative scarcity of land will not occur at once, or evein in a visible manner. But this does not make it less of a very real threat in the long run. Emigration to the coastal countries is one of the natural solutions to such a situation. Seasonal emigration exists already; it may well become more permanent. Birth control, besides being eminently desirable from the viewpoint of the personal health of mothers, is, of course, another solution or at least part of it, and it may be well for the Government to give some thought to this aspect. Several other African countries -- some of which do not even face serious land shortages -- have done so already and started, or are about to start, active population policies. - 48 -

Economic Dependence

132. Dependence, in the sense of lack of control over factors that determine external relations, is a profound feature of Niger's economy. Its first manifestation is in relation to foreign markets on which Niger has no influence since the various support schemes of France and the EEC for groundnuts and cotton were terminated in 1968. The effect of the wide price fluctuations for these products is essentially twofold: first, in order to avoid marked changes in prices that would not be understood by the farmers, producer prices have been isolated from the world market at a low level, thus leaving the marketing margins to absorb price movements; second, these margins, which are a substantial source of public revenue, are impossible to predict with any accuracy and as a consequence their use tends to be haphazard. Further, since the volume of exports, including livestock, is very sensitive to weather -- more than it is to efforts at improving techniques -- it can be concluded without much exaggeration that Niger's control over its main exports, the primary source of economic activity, is practically nil.

133. External markets may also present a particular "twist" that is unfavorable to a primary producer like Niger. This appears to happen in the case of groundnuts and groundnut oil (see para. 34) preventing the processing industry from generating a significant proportion of value added locally. The groundnut/oil price relationship is such that the greater part of value added occurs in the consuming countries, at the last stages of transformation into edible oil, margarine or other products.

134. Niger should draw maximum benefit from the size and economic dynamism of the coastal countries, chiefly Nigeria, that provide the main outlet for livestock, but here again it is especially dependent upon them in the sense that they, as consuming countries, determine the terms of trade, in the broad as well as the strict sense of the word, via tariffs or price controls. This is the main reason why animal exports are predominantly made on the hoof and very little is exported in the form of meat.

135. Niger is also highly dependent on the external world for its investment program as can readily be inferred from the size of the "resource gap": 6-9 percent of GDP, a magnitude sometimes (i.e. 1969) larger than total gross investment. The constraint in this respect is not so much finance, for in the past the Government has been quite successful in attracting foreign public and private capital. It is rather the difficulty in designing and implementing national plans due to the uncertainties as to the amount, context, and timing of external aid, and the slow progress in coordinating a growing number of aid agencies with widely varying approaches and procedures. This applies to capital aid as well as technical assistance and pre-inves!tment activity such as studies or mineral exploration.

136. Inter-regional cooperation also imposes limitarions. The fact that Niger is a member of no less than ten regional bodies is witness to the com- plexity of the problem. Transport to and from the coast, and the use of the Niger waters are major cases in point. - 49 -

137. In the end, Niger's effective command over national resources, directly or indirectly, is practically always contingent upon some form of external intervention. This is to be borne in mind when assessing Niger's economic performance as well as future strategy.

C - Government Development Policies

138. The previous Bank economic report (AW-36, Volume II, Dec. 1971) described extensively Niger's planning system as it worked until 1970 or 1971. At the time of the take-over by the military forces (April 1974) the former Government, apparently dissatisfied with results achieved so far, had been engaged for many months in a thorough revision of goals and methods of development policies. Considerable work had been done by the technical ministries and the ministry of development, with some foreign technical assistance, in preparing sectoral dossiers that were to lead, eventually, to new "prospects for the ten years 1973-1982" after approval by the political authorities. The contents of the sectoral studies remained unknown to outsiders though indications were that total public investment over the ten years was to be around CFAF 120 billion (presumably commitments) or about twice the level (disbursements) of the last few years.

139. On the other hand, some major orientations had been made public on various occasions, albeit without reference to any program framework. First priority was given to food crops. This choice is clearly dictated by the current dramatic food shortage, but is also a necessary condition for the revival of commercial crops: in the absence of reasonably assured food supplies farmers will neglect export crops. A second priority line of development was the growth and diversification of agricultural exports in terms of products, degree of processing and,markets. Thus, besides groundnuts, the aim would be to develop secondary export crops including cotton, cowpeas (niebe), onions, and fresh vegetables that have good market prospects in neighboring countries; processing of exports was seen as a means to increase domestic value added, hence the development of cil mills, slaughter houses and other processing industries.

140. Also in response to the present situation, a program of resource conservation and drought control was very much to the fore: some actions in this direction have alreadly been submitted to and approved by external sources of aid (including IDA), but a much broader program was to be designed, including reforestation and systematic use of water resources. At the meeting of the heads of state of the Sahelian countries of September 1973, in Ouagadougou, the former President of Niger had mentioned a figure of CFAF 200 billion ($800 million) for a long-term program in this domain. - 50 -

141. The chosen mode of development would not differ in nature from the past. It would rather intensify an array of actions ("animation") aimed at developing the farmers' awareness of and participation in economic development and social progress ("promotion humaine") without significantly altering the fabric of traditional society -- for example as regards land ownership and the structure of farms -- , but rather by superimposing upon it a network of cooperatives or quasi-cooperative organizations. Rural development institutions would not be modified, with the "integrated" arrangements between the staffs of the ministry of rural economy, UNCC, the ministry of human promotion ("service de l'animation") and the ministry of education (for the functional literacy component) remaining the basic organization at the field level. There were under study, however, proposals to give a more unitarian control to the implementation of selected projects with a project directorate getting full command and having staff from the other institutions fully seconded to it. Irrigation projects are already under the sole responsibility of one institution, either UNCC or the Service du Genie Rural of the ministry of rural economy.

142. Objectives and methods in other sectors had not yet been spelled out at the time of the change in Government, although some directions appeared fairly clearly. Thus, the effort to identify and develop mineral resources undertaken over the past years was to be intensified with priority given to uranium (see Part I, paras. 20, 21, 23, 24, and 58), but also to oil following "encouraging" findings by foreign prospecting companies in the eastern part of the country. Systematic prospecting in the west -- in cooperation with the inter-state Liptako-Gourma Authority (Mali, Niger, Upper Volta) -- , where iron, copper, manganese and other minerals are known to exist, is also part of this effort. The role of the mining sector would be to consolidate the country's export potential, provide Government revenue, open up new employment opportunities and eventually constitute the basis for metallur- gical industries, with the first two objectives being of paramount importance.

143. Transport policy in the past has been to upgrade the most important trunk roads: the east-west road running 1,830 km from Lake Chad to the Mali border and linking the country's most important centers (Zinder, Maradi and Niamey), and the branches towards Dahomey and Nigeria to the south and Tahoua to the north. Total length of paved roads thus increased from a mere 150 km in 1965 to about 1,000 km at present. In parallel with this vast construction program (supported mainly by FED, CIDA, FAC and IDA) the former Government undertook, with IDA assistance, a comprehensive highway maintenance program which resulted in the building up of adequate capacity to ensure current maintenance of roughly 4,500 km of roads out of the 7,000 km constituting the country's classified highway network.

144. The main components of the upgrading program for the future would be:

(i) the widening and strengthening of about 400 km of paved roads built to one-lane standards (3.5 m wide pavement) in the 1960s;

(ii) the completion of the paving of the east-west trunk road with financing to be provided by FED. The links for which financing is still to be found are Tillabery-Mali border (115 km) and Myrria-Goure (160 km); - 51 -

(iii) the upgrading of road connections with Nigeria and Upper Volta; and, most importantly,

(iv) the construction of the Trans-Sahara road the first sections of which, Tahoua-Agadez (445 km) and Agadez-Arlit (260 km), would serte mining developments in the Air region.

145. The proposed program concerns more than 1,600 km and would require large amounts of external. financing, of the order of US$150 million. However, this set of operations was no more integrated into an overall program than other sectoral programs. With a view to completing the transport -- in fact, the road -- program in terms of its timing, project content, maintenance, organization and regulatory policies, a Transport Survey to be undertaken in late 1974 by consultants has been commissioned by the Government with French (FAC) financing. The survey is also to give particular attention to the need for secondary and rural roads (for which a first improvement program covering 1,400 km has been launched in the framework of drought relief measures financed by external agencies). ELesides roads, the Government is keenly interested in the possibility of using the Niger river for transportation especially of bulk goods such as petroleum products (see para. 43).

146. In the particularly difficult field of education, it seems that the former Government had decided to go ahead with instructional television (ITV) at the primary level before a decision had been made about reforming primary education (curricula, duration, structure) and also before Niger's share in the costs of ITV (now borne by France, see Part I, paras. 48, 49) had been assessed. However, no program -- with or without ITV -- had been formalized yet and the whole issue of the future of education was left unresolved, presumably to be discussed again in the framework of the development program of the "ten-year perspective 1973-82".

147. The new authorities thus assumed responsibility at a time when the development strategy for the long run was still in the making and many uncertainties remained as to the size of the program, its resources, sectoral priorities and institutional reform. As of now, the Supreme Military Council (Conseil Militaire Supreme, CMS) has not made any formal statement on its economic policies in general. It has strongly indicated, however, its resolu- tion to address itself, first and above all, to the task of ensuring speedy and effective distributiona of food supplies to all sections of the population affected by the drought. Until the next harvest, in October-November 1974, this task will probably demand the best part of the administration's time and capability, but there are indications also that the Government wishes to eventually embody its policies into a formal development plan.

148. In the meantime, a reorganization of the Government structures has been effected. The main departments in charge of economic development are now -- besides the Ministry of Finance the structure of which has not been modified -- the Ministere du Developpement, des Mines et de l'Hydraulique; the Ministere de l'Econom:Le Rurale, du Climat et de l'Aide aux Populations; and the Ministere des Affaires Etrangeres et de la Cooperation. Besides, three - 52 -

of the four recently appointed Secretaries of State, all young civilians with high professional responsibilities in the former Government, have been put in charge of Rural Economy, Development and Cooperation.

D - Strategies and Prospects

149. There is no reason to believe, at this point, that the new Government will opt for objectives essentially different from those stated above. Surely, the priority currently given to food distribution is understandable and is only the most urgent aspect of a longer-term effort to ensure adequate food supplies to the population, and of a broader action toward recovery of agricultural production including that of exportable crops. This and other indications point to the Government's desire to found its development policy on the widest possible base in the rural areas. Presumably, agricultural policies will imply a reinforcement of, rather than a departure from, past actions seeking to develop a cooperative system and obtain the participation of farmers in production as well as marketing improvements. It is therefore a basic assumption of what follows that agriculture will effectively constitute the Government's top priority and the center-piece of its development strategy.

150. On other sectors the official position is more difficult to ascertain. While it can be assumed that the transport program, which is essentially based on technical considerations, raises primarily a problem of 'phasing and financing rather than of strategy, the delicate question of the form and scope of education policy remains very much unanswered. On the other hand, it is clear that the Government will give great priority to mineral production by attracting as much as possible foreign capital and expertise to this sector, as illustrated by recent developments in uranium production and exploration (see Part I, paras. 19 ff.). More generally, it appears to be the CMS's intention to strengthen further the country's open and cooperative attitude vis-a-vis the rest of the world particularly within the West African Monetary Union and through cooperation with EEC. The "mixed" character of the economy, with thirty or so public and semi-public enterprises active in most sectors (see Statistical Appendix, Table 10.6), is still expected to leave room, as in the past, to private foreign capital, although in industrial undertakings rather than in commerce or services.

151. This brief characterization of the Government's position is taken as background to the following sections of this report in which a strategy is outlined and supporting projections are made. But clearly neither one or the other is intended to be a substitute for a development program. Their aim is rather to highlight issues and roughly estimate requirements for external assistance. One obvious limitation of the following comments stems from the lack of sectoral expertise, outside agriculture, in the economic mission. Use is made, however, of the provisional conclusions of the education and transport missions that visited Niger at various times in 1973 and 1974. - 53 -

Development Objectives

152. The structure of the economy, its current experience and the nature of the dominant constraints strongly suggest that the thrust of the development effort should be towards a dual objective: to ensure food supplies and to develop exports. Other economic goals should be subsidiary to these, exactly in the sense of furnishing aid and support to them. Consequently, for projects not directly related to the achievement of the two priority objectives one decisive, although negative, criterion should be to avoid burdening the economy in general and Government finances in particular. This approach would apply to industry as well as transport, power, telecommunications and other service sectors.

153. To some extent, the twin objectives relating to food production and exports compete with each other, but in a large measure they are also either complementary or essentially independent and therefore do not raise problems of choice as difficult as might be thought. The first reason for this is that in agriculture, where the export potential lies in the first place, farmers will not give attention to export crops unless they feel reasonably sure of their food supply, as already noted; conversely, they will become quite res- ponsive to incentives to develop export crops when and if the availability of food supplies raises no doubt in their minds. Secondly, most if not all export crops are grown in association with food crops, i.e. millet/sorghum; this is generally the case of groundnuts or cowpeas; in other instances, the same "crop", as is most clearly the case for livestock, but also for groundnuts and cowpeas, is produced both for home consumption and for sale, though the relative importance of each "market" varies. "Pure" commercial production is rather the exception: cotton is the main one (tobacco is another minor example).

154. The second reason is that the other notable export potential is in mining, uranium at the moment, a sector that is largely isolated from and does not really compete with agriculture for the use of resources, essentially because of its "enclave" character. It can thus be safely said that the many billions of CFA francs that have gone or may go into exploration and production of uranium have not been dLstracted from agriculture, or any other sector for that matter.

Strategy for the Rural Sect:or

155. Agriculture will be central to the overall development strategy in fulfilling the two priority targets, while mineral exports will provide a most needed complementary instrument to generate an adequate volume of foreign exchange. In the generally accepted development model, agriculture is supposed to be (a) the supplier of food for the population in general and the urban centers in particular, (b) a source of additional savings for rein- vestment in the rest of the economy, (c) a source of foreign exchange, (d) a reservoir of labor for other lines of production, and (e) a market for other sectors' products. In thiu; model the share of agriculture in GDP and the absolute size of its labor force shrink over time. Of course, the five roles - 54 - assigned to the sector imply a continuous increase in agricultural productivity per head. In the Nigerien context (and in similar economies), however, agriculture should play at the same time a more important and a more limited part in the development process, essentially because not only the overwhelming majority of the population is rural, but because it is inconceivable that its absolute size could diminish given the lack of employment opportunities outside the sector. Thus, assuming continued urbanization at 6 percent p.a., irrespec- tive of the state of productive employment availabilities in the cities, the size of the rural population will still grow significantly as illustrated in the following hypothetical case (in thousands):

1973 1983 1993

Urban population: + 6 percent p.a. 234 419 750 Total population: + 2.25 percent p.a. 4304 5377 6717 Rural population: (thousands) 4070 4958 5967 Rural population: (index) 100 122 147

Put in a different way, for the rural population to remain at its present level the urban population would have to rise to 1.3 million in 1983 and over 2.6 million in 1993 -- clearly impossible assumptions.

156. Agricultural development will therefore aim principally at (a) ensuring food supplies for the rural population itself and partly for the cities, (b) providing savings, and (c) providing foreign exchange, while the other targets -- the labor supply and market functions -- will be of much lesser importance. The foreign exchange function is an especially important one because in Niger's conditions exports are a major determinant of national income, together with two other "autonomous" factors: subsistence agriculture and external aid. 1/

157. There are no figures on which to base a reasonably full assessment of the present and potential role of agriculture in generating savings. An interesting indication is the amount of public revenue in the form of taxes or quasi-taxes (margins of public marketing organizations) generated by agriculture, though even this is difficult to determine. In recent years agriculture has provided between CFAF 6 and 7 billion (including indirect taxes) annually to the public sector while "receiving" an average CFAF 1.5 to 3 billion (excluding foreign aid). 2/ While it is not possible, at this stage, to suggest a savings target or even one for agriculture's contribution to public revenue, it should be, contrary to past practice, an acceptable objective for the Government to make the rural sector a net beneficiary of public funds on a long-term basis; indeed, to achieve the production targets and the transformation of the rural world that are to be the mainstay of social progress, the agricultural program outlined hereafter will require a much larger volume of public expenditure on agriculture than in the past.

1/ See The Economy of Niger, IBRD report AF-77a, July 8, 1968.

2/ See Volume II, Agriculture, Introduction. - 55 -

Components of an Agricultural Program

158. A program for agriculture geared toward-the achievement of self- sufficiency in (basic) foodstuffs, consistent with a resumption of at least past volumes of exports and consistent also with the style of development adopted by the Government can be conceived as a continuation of current programs, although with different emphasis as to the various sub-programs, accom- panied by a significantly higher level of spending and a much intensified organizational effort.

159. Current agricultural policies are made up of (or can be rationalized as consisting of) six types of programs plus one specifically related to the drought: 1/

(i) General coverage programs ("programmes de couverture") comprise the general activities carried out by the Agricultural Services within the framework of their current budgetary allocations. They include chiefly the distribution of pesticides, improved seeds and fertilizers as well as animal health programs. The scope of these actions, however, has remained quite limited for lack of receptive structures outside the areas where cooperatives are active, and above all because of the weakness of the financial and personnel facilities of extension services (on the average there is one extension worker for 5,000 farmers);

(ii) Four specific crop development schemes to increase productivity have been carried out successfully; for groundnuts ("improved seeds plan"), the most important export crop; for cotton with a view to fully develop the country's modest potential of some 20,000 hectares; for cowpeas ("niebe") which are increasingly grown since 1971 and are of growing interest for export; and for fresh vegetables (irrigation project undertaken by the Government: Societe Nigerienne des Primeurs) for export to coastal and European markets;

(iii) The so-calLed productivity operations deal with a well-defined geographical area rather than with a specific crop. They are conceived as integrated rural development projects with some key common characteristics, in principle at least. They concern the mass of the farmers in a given zone; they are implemented :Ln the framework of traditional farming; they imply an active participation by farmers; they aim at increasing the whole pattern of crops rather than any one in particular; they seek-to improve general-living conditions of the farmers by providing siome social infrastructure. The first phase of such an operation has started in the Zinder region with FED financing; in the same vein, though on a more limited scale, projects are underway in Badeguicheri and Dosso;

1/ See Volume II, Chapter III. - 56 -

(iv) Irrigation projects are the most typical of all specific operations in that they imply a heavy concentration of investments, an almost industrial type of management and a high level of productivity. At the end of' 1973, a little over 4,000 hectares, of which 2,500 hectares in the Niger valley, had been put under irrigation at a total cost of about CFAF 3.5 billion. These projects provide an attractive income for farmers though they have in the past met with a number of difficulties in connection, among others, with land tenure problems, farmers' resistance to the necessary production discipline, and sometimes unforeseen technical incidents. However, in recent years considerable progress-has been accom- plished by UNCC with regard to management;

(v) Specific schemes for livestock concern semi-extensive ranching in the sahelian zone (Ekrafane), milk production around an irrigated lot (Kirkissoye), and an attempt at developing feedlots with irrigated fodder production (Tiaguirire, starting in 1974). In varying degrees these operations still have an experimental character, although they are implemented as actual development projects;

(vi) Special efforts have been made in recent years to develop processing industries based on local products, either through incentives to private investment (oil mills, textiles), or by creating public or mixed enterprises (rice mill, millet flour mill, tannery);

(vii) Finally, a short-term program against the drought has been conceived within the Sahelian Interstate Organization amounting to a little over CFAF 10 billion for Niger alone. It concerns a list of projects whose funding by external sources is practically ensured (including $2 million from IDA).

160. The proposed strategy would call essentially for (a) the implementation of large-scale productivity or integrated rural development operations in four areas in the south, (b) the development of irrigation projects mainly in the Niger valley covering 15,000 additional hectares, and (c) the shaping of livestock policy into a system of three successive stages of livestock development from breeding in the pastoral zone to fattening in the southern areas. The implementation period of this basic program would be about ten years. Its cost would approximate CFAF 30 billion ($120 million) with the following breakdown: - 57 -

Table 15: BASIC INVESTMENT PROGRAM (Billions of CFAF)

1st Decade 2nd Decade (implementation) (implementation) 1974-1983 1984-1993

Productivity operations 15.9 9.3 Irrigation 6.0 1.2 Storage 1.2 0.3 Livestock 6.8 -

Total (rounded) 30.0 11.0

161. These figures do not include the cost of agro-industries that would logically complement the basic program (sugar mill, rice mills, etc.) but are expected to be financed principally by private capital. Their total cost would be around CFAF 5.5 -- 6 billion. 1/ Besides, the figures above are based on end-1973 cost estimates.

1. Rural Development Projects (Productivity Schemes)

162. The productivity schemes would consist of an expanded program for the Zinder (east) region; a larger project, starting hopefully in 1974/75, in the Maradi department graclually embracing close to half a million people; a new, similar project in the Dosso department by the end of the current decade, and one in the Niamey department (except two districts) in the early eighties. About 80-90 percent of cereal production (millet-sorghum), 100 percent of groundnut and cotton production as well as practically all secondary crops -- especially cowpeas (niebe), onions and tomatoes -- would fall under these four operations. Thus, the bulk of the rural population would, over the next ten years, be covered by this part of the program.

163. Each of these projects would take on average five years (gestation period) for its physical components (which form a modest share of the cost and consist of storage facilities, housing for extension and supervision staff, secondary rural roads, somketimes small irrigation lots using underground water, and social infrastructure such as dispensaries, etc.), the extension and supervision network and thle cooperative structures to be put in place. The full penetration of the technical themes among farmers (use of pesticides, improved seeds, planting in line, use of fertilizers, use of draft animals, irrigation techniques whern applicable, etc.) will take even longer. In fact, the various "progress thenies" that tend to reinforce each other will not be adopted at the same speed or to the same extent: probably 10-20 percent of the population concerned w'ill remain totally unreceptive to all of them, others will be accepted and effectively applied by 20, 30 or up to 90 percent of the farmers.

1/ See Volume II, para. 6.77. - 58 -

164. What is expected of this type of program is not dramatic increases in yields and/or output per head but rather a maximum dissemination of well- proven, simple techniques. Thus average increases in yields 1/ would be typically as follows compared to traditional levels:

After 5 years After 10 years (gestation period) (maturation period)

Cereals (kg/ha) +15 percent +15 percent

Groundnuts (kg/ha) +33 percent +67 percent

Cost per farm per year CFAF 48,000 CFAF 5,600

The table shows another notable feature of this sort of operation, namely the sharp decrease in the unit cost of the project after the implementation and gestation period of five years following which costs are akin to maintenance expenditures; this is due essentially to the lighter extension network once maximum dissemination of the technical themes has been achieved.

165. The success of this program with its very wide scope -- geographical, human, technical -- will critically depend upon two unrelated factors: organization, and the weather. Little can be said about organization here, as this aspect is to be directly dealt with in the preparation of each project; also, the organizational pattern may differ somewhat from region to region, depending on local experience, strengtlh of the cooperative system and idiosyncrasy of the external aid agency involved. As a general rule, however, there would appear to be a strong case for a more clear-cut, unitarian structure of command for each project than allowed for by the current "coordinated" approach of the various Government agencies involved, based on an annual action program and relying on various joint committees for decision making. One basic reason is that, in fact, the cooperative structure is still very loose despite remarkable progress and has little impact on production methods as it is almost entirely geared to marketing.

166. The second problem stems frorn the fact that whatever the merits of the productivity projects in terms of agricultural techniques, organization, farmers' cooperation or financial dimension, they will not escape the influence of weather vagaries since they essentially concern rainfed crops. Thus, their success will be measured by the growth of production under the "normal" climatic conditions of each region as represented by average rainfall and normal rainfall distribution. No doubt, some of the techniques to be introduced -- e.g.

1/ These and other technical and economic coefficients are based on the current appraisal of the Maradi-project, the largest and most thoroughly studied operation in this category. See Volume II, Part II and Volume III, Annexes VII and XIV. - 59 -

the use of fertilizers or of short-cycle varieties -- will permit better results under poor weather conditions than would be achieved otherwise. Also, the productivity projects will normally include drought control programs -- e.g. reforestation to prevent soil erosion caused by wind and rain; they may also include a small irrigation component -- e.g. 100 ha/year provided for the proposed Maradi project. Despite these components, however, the effect of rainfall deficits will be unavoidable, whether they occur in a haphazard way or result from a long-term trend.

2. Irrigation Program

167. The fundamental uncertainty linked to the climate -- or rather the certainty that there wi:Ll be unpredictable ups and downs in rainfed crops -- calls for corrective measures since, clearly, the recourse to international aid in case of drought is something that all parties concerned, the Government in the first instance, will want to minimize. The corrective factor can be found in irrigated agriculture. The agronomic, hydrological, organizational and financial aspects of irrigation are discussed in Volumes II and III of this report (see especially Annex X), and the following brief comments are therefore confined to its economic rationale. However, it cannot be too strongly emphasized that. in a country with limited and somewhat inconclusive experience in irrigated agriculture, those aspects are critical for the success of this part of the development strategy, whatever its justification in principle.

168. The desired level of food supplies for the population at large can be met from three sources: (i) rainfed production, (ii) irrigated production, and (iii) imports. The choice, of course, is not between one or the other of these alternatives at the exclusion of the other two. It must rather be decided what should be their resDective role so as to minimize the total cost to the country while achieving the stated objective. More precisely, since the bulk of food production comes from rainfed cultivation 1/ the question is to decide what complementary role, if any, irrigation and/or imports should play. On the other hand, the probLem is made more complex by the uncertainty regarding future weather accidents and future prices (especially of imports) and costs (especially of irrigation); but while some forecasts are possible as to costs and prices, none can be made as to climatic conditions. 2/

1/ Even in a particularly bad year, 1973, the cereal crop was still 70-75 percent of normal requirements.

2/ The question here is double: (a) what is the probability distribution of rainfall deficits around the "norm", and (b) is there a downward trend in "normal" rainfall. On question (a) use could be made of rainfall records over 30 years or so (see Vol. III, Annex I); on question (b) scientists do not seem to agree as yet. - 60 -

169. Irrigation and/or imports thus appear as complements to rather than substitutes for rainfed production. Indeed one or the other is at a disadvantage relative to rainfed production if one compares average costs per unit of a given volume, and the economic value of irrigated production and/or imports lies in the fact that they represent assured sources of supply, whereas, at the margin at least, rainfed production does not. Thus, the cost of irrigation and/or imports is akin to the cost of an insurance, with the complicating factor just mentioned that the risk to be covered cannot be measured in any actuarial sense, but can only be guesstimated. A pragmatic approach is therefore indicated.

170. As a policy objective it is probably reasonable, first of all, to accept that catastrophic crop failures (as in 1973) cannot be economically prevented and that in such circumstances international aid will have to play an essential role. Secondly, as noted earlier, the irrigation potential cannot be developed at will: an important threshold exists at the point where a major structure on the Niger river would be necessary (see para. 123); this leaves some 17,500 ha in the river valley 1/ (plus a few hundred within the productivity projects) which is also about the size of a feasible program for the next ten years or so from the viewpoint of the country's construction capacity.

171. The implementation of a program of this size at a cost of some CFAF 6 billion ($24 million) can then be justified because the opportunity cost of the alternatives would be higher both in economic terms and in terms of practicability:

(i) Conceivably, allocating more resources to rainfed production could permit and ensure adequate cereal supplies even in case of poor weather; however, because of limited land availability this could be done only (within the productivity projects) at the expense of export crops, chiefly groundnuts; further, to obtain the same amount of cereals as from 12,500 ha 2/ of irrigated land, or 100,000 tons, over 150,000 ha under rainfed cultivation would be needed which in turn would mean foregoing approximately 100,000 tons of groundnuts (unshelled) or CFAF 5.5 billion ($22 million) worth of exports (f.o.b., 1973 prices) Finally, in order to ensure the desired production under all circumstances the area under dry cultivation would have to be even larget, in order to include a safety margin.

(ii) The cost of the other alternative, imports, will depend on world prices and exchange rates; although the CFA franc system prevents the occurrence of short-run exchange problems, the

1/ Including 2,500 ha already under production. See Volume II, para. 6.60.

2/ Projected to be devoted to cereals (mainly rice). - 61 -

balance of payments position of Niger, as will be seen later, will not be an easy one in the long run and the foreign exchange constraint may become serious. It appears that projected world prices of cereals -- especially sorghum and rice -- and their cost to Niger are such that local irrigated production is likely to be competitive even without shadow pricing any factor of production. 1/ Also, in case of a food deficit resulting from poor weather, prices will rapidly rise worldwide as in 1973, and a marginal buyer such as Niger cannot expect favorable conditions under these circumstances; rather it may encounter difficulties in obtaining supplies. Timely delivery of bulk supplies -- as current experience demonstrates all too well -- is a further problem, due to, among other things, transport bottlenecks, especially at the ports of Lagos and Cotonou. Thus, it would seem preferable to leave to imports only a marginal role in covering possible staple food deficits. Until a sizeable area is under irrigation and buffer stocks are put in place, however, imports will remain important. And it should be clear that large deficits will in any case require external financing -- in fact free food deliveries. Indeed, if Niger had had to pay for its exceptional food imports in 1973/74 (say, 300,000 tons) the bill 2/ would have been equivalent to the country's total foreign assets at the end of 1973; at that time they were about 5 months worth of imports.

172. The development of up to 17,500 ha of irrigation (including 2,500 ha already developed) ovier ten years, as proposed, would also include 3,000 ha for fodder crops, in Line with the livestock program and 3,000 ha for sugar-cane assuming that an economically justified project for sugar production has been designed on its own merits. 3/

173. Irrigation wilL also be beneficial in other ways besides its "food insurance" role: first of all for the farmers directly concerned and their families (over 100,000 people) for whom it will be an important source of income, especially in the river valley where alternative employment possibilities are very limited. In the longer run, the question whether further irrigation projects, in other parts of the country and in the valley, will be economical, will depend essentially on two factors: population growth, and the degree to which technical progress in rainfed agriculture will permit to compensate the effects of poor rainfall. On both counts there seems to be room for an expanded irrigation program, but the Government should be well aware of the fact that its incremental cost is likely to be much higher than that of the more limited program proposed for the next decade.

1/ See Vol. II, paras. 6.21 and 6.22. 2/ See footnote p. 42. 3/ See Volume II, paras. 3.31 and 3.32. - 62 -

174. As a complement to and with the same general justification as the irrigation program the Government should implement a buffer stock policy by considerably expanding the present role of OPVN. 1/ This organization (created in 1971) was designed to help reduce food price fluctuations during the year as well as regional price disparities; in this respect it has not had the time nor the means to act effectively. Since 1972 it has been entirely engaged in the distribution of relief food. In the future, after the end of the current drought, it should act in coordination with the cooperatives to build up and manage buffer stocks of basic foods (cereals). A first estimate would indicate the need for developing storage capacity from its present level of 15,000 tons to 140,000 tons in 1984. 2/

3. Livestock Policy

175. The third component of the basic program for agriculture is livestock. It is an essential part of it because it will go a long way, if successful, to meet the food supply and export objectives, and it is of direct concern to about 800,000 people. It is, furthermore, a sector particularly vulnerable to droughts.

176. Substantially along the lines of a recent study by consultants commissioned by the Government, livestock policy should be founded on the recognition of the complementarity of different zones: extensive breeding in the pastoral zone (i;e. roughly north of the 350 mm rainfall line) and fattening in the agricultural zone. This approach would require the introduction of large-scale grazing control measures in the pastoral zone, including extension and animal health services and improved watering and livestock marketing facilities Four pilot zones could constitute the initial phase of the program. The lean cattle would be fattened in higher rainfall zones by smallholders or in small feedlots using crop residues, agro-industrial by-products and, eventually, irrigated fodder. For this reason the proposed irrigation program foresees the development over ten years of 2,000 hectares irrigated fodder production along the Niger. This two-stage circuit, organized for example by mixed enterprises managing feedlots and selling meat through SONERAN, 3/ would develop parallel to the traditional circuits.

177. Because of the livestock losses caused by the drought (preliminary estimates indicate them to be almost 50 percent of the pre-drought herd) the first objective must be the rebuilding of the herd. It is tentatively estimated that the cattle stock will regain its optimum size (about 4 million head) in only 8-10 years, provided no new catastrophic droughts occur. The proposed policy would facilitate this task and would at the same time allow an appreciable and needed increase of the rate of exploitation.

1/ Office des Produits Vivriers du Niger.

2/ See Volume II, para. 6.59.

3/ Societe Nigerienne d'Exploitation des Ressources Animales. - 63 -

178. Two important arLd closely related assumptions for the development of Nigerien livestock are that beef prices in importing countries will continue to rise both in real and money terms 1/ and that Governments in these countries will permit a reasonable share of the increase to be passed on to producers. This implies that no price controls are imposed in the consuming countries. It would also imply that import taxes designed to dis- criminate against imports of meat, thereby favoring imports of live animals, are not prohibitive. On the other hand, in view of the foreseeable increase in demand for meat in West Africa, the question of exports to other markets does not arise, except perhaps for some marginal sales (frozen meat) to North Africa and the Middle East, for example.

Other Aspects of Agricultuiral Policy

179. The three components described above form the program deemed essential to the achievement of the main objectives. There are, of course, other aspects of a policy of rural development, but these are in support of the basic program rather than being distinct elements. This is the case of agro-industries (oil mills, rice mills, cotton ginneries, millet flour mills, slaughterhouses, etc.), and it is suggested in this respect that to the extent possible these undertakings be left to private enterprises or private management with as little public capital (directly or indirectly through tax holidays and other benefits) as possible; there is no point in overburden- ing the Government with management and supervisory tasks when the implementation of the basic program will already require all its resources and effort. Agronomic research and training are other important supporting programs.

180. Price policy is also, in a sense, secondary. It is so because to the extent that the production objectives are met, and the buffer stock policy is successful, prices of staple foods (for the small part which is marketed) will effectively reflect relative scarcities at levels that ensure adequate supplies. Government intervention will remain important, however, for the two export crops where for structural reasons price policy can be effective -- groundnuts and cotton -- provided food crops are more or less adequate. Price policy for these two products will have two purposes: first, to maintain a price relationship between these and other products (essentially cereals) that makes export crops sufficiently attractive to farmers; thus, experience suggests that producer prices of groundnuts and cotton per unit of volume should be about twice the price of millet-sorghum. The second purpose will be to collect revenue (or pay out subsidies) according to export market conditions. A third purpo3e which may also be thought valuable is to avoid excessive price fluctuations that would be incomprehensible to and badly

1/ Current orolections of world market prices are that beef prices will increase by 188 percent in current dollars and 115 percent in 1974 dollars between 1973 and 1985. - 64 -

received by farmers. Still other objectives may be sought (e.g. to maintain real purchasing power of a given crop, etc.) but do not appear as essential for the realization of the basic program. 1/ An important consideration in fixing producer prices for groundnuts (and also cotton) is the level of corresponding prices in Nigeria. In the past, price differentials have determined diversion of sales by farmers in one direction or the other. Producer prices in Nigeria for 1974/75 have been raised considerably: they are now equivalent to about CFAF 42/kg (shelled nuts), whereas the price in 1973/74 in Niger was CFAF 29/kg. The difference is even larger for cotton. Diversion of sales, of course, may pose a problem for the balance of payments and Govern- ment revenue but is by definition, advantageous to the farmers themselves.

181. Table 16 summarizes the development of agricultural exports up to 1980. Its price and volume assumptions are spelled out in Volumes II and III (especially Annex XIV), but corrections have been made concerning (a) the estimates for 1973, based on more recent information, and (b) future prices of groundnut products and cotton, based on revised IBRD projections as of June 1974. As a result, the projected export levels, in current terms, are somewhat more favorable than those shown in the report on agriculture (which was substantially completed in February 1974).

182. Agricultural exports would more than double, in current prices, between 1972 and 1980. This growth would result approximately in the same proportion from price and from volume increases. During the projection period the share of groundnut products would remain predominant, increasing until 1977 and then decreasing'again. The share of livestock and meat would slowly recover to its 20 percent "pre-drought" position but would become progressively more important in the eighties (see para. 203 below). In constant dollars, i.e. in terms of purchasing power, the price of groundnut products and cotton would decline somewhat, whereas that of livestock and animal products (including hides and skins) would most probably rise, since this is a line of production where Niger's comparative advantage is presumably greater than for groundnuts; oils and fats are highly substitutable and are produced in neighboring countries (i.e. palm oil), whereas ecological factors limit the possibilities of livestock development in these countries.

1/ See Volume II, paras. 6.71 ff. - 65 -

Table 16: AGRICULTURAL EXPORTS (Billions of CFAF)

1972 1973* 1974 1975 1976 1977 1978 1979 1980

Groundnut products 6.2 5.2 0.5 9.4 13.1 13.9 14.5 15.2 15.6 Cotton 0.2 0.1 - 0.3 0.5 0.6 0.9 1.0 1.1 Livestock (and meat) /1 2.2 2.7 1.0 1.5 2.1 2.4 3.3 3.6 4.5 Other /2 0.8 0.8 1.0 0.7 0.9 0.9 1.5 1.8 2.0 Unrecorded 1.7 0.9 ------

Total, 11.1 9.7 2.5 11.9 16.6 17.8 20.2 21.6 23.2 Total ($ million)** 44.5 43.7 10.0 47.5 66.5 71.3 80.8 86.4 92.8

*Very provisional. **$1 = 252 CFAF (1972), 222 CFAF (1973), 250 CFAF (1974 etc.).

/1 Excludes meat up to 1973, includes meat after 1973. /2 Hides and skins, cowpeas, onions, vegetables, and miscellaneous.

Other Sectoral Prospects and Overall Growth

183. No more than for-computing import elasticities (see below) does there exist a sound basis to derive capital-output ratios to use in projecting GDP or sectoral aggregates. Surely, past investment rates (see Statistical Appendix, Tables 2.3-2.6) appear to have been quite low (under 10 percent) consistent with low or negative real growth of income. However, not only serious statistical gaps, but also the impact of non-economic elements such as the weather, the weight of rural and other traditional activities where the role of capital Is hard to grasp even conceptually, and the developmental effect of non-capital expen(litures make the capital-output ratio at best a loose relationship and, without further in-depth research, one that cannot meaningfully serve in projection exercises in a case like Niger's.

184. For reasons alreadty indicated, a systematic sector-by-sector approach is not feasible either. A number of partial indicators can be used, however. First, as a result of the agricultural strategy proposed the volume of agricultural output is roughly expected to be 20 percent over its "normal" level (1971) in 1980, but by as much as 80 percent over that level by the mid-eighties 1/ when the various programs have become fully productive. Mineral production (uranium), in terms of value added, is subject to serious uncertainties (see paras. 188 f. and Statistical Appendix, Table 10.7). It is

1/ See Volume II, para. 6.66. - 66 -

projected to positively contribute to GDP till the mid-eighties, much less or not at all thereafter, if prices do not increase further. Value added by the secondary sector roughly doubled (in current terms) between 1966 and 1971 as a result of an effort to develop agro-industries; this trend should continue in parallel with the growth of agriculture itself; no other manufacturing activities of major importance are projected, though some development may occur in light, labor-intensive, export-oriented lines of production (e.g. garment industry). The growth of exports and imports and expanding industrial activities will, as in the past, produce continued growth of public utilities, commerce, transport and related services, though at a modest pace as their share in GDP is already over 40 percent.

185. Finally, the growth of Government services (i.e. salaries) will, of course, be constrained by overall budgetary considerations. Revenue and expenditure in current prices may increase considerably during this and next decade, notably as a result of the growth of external trade which provides the taxable basis for over half of current revenue and which will more than double between 1972 and 1980 (see following section). In real terms, however, the average annual increase of current revenue/expenditure (and accordingly of the Government's contribution to GDP) could be a modest 3-3.5 percent if prices in Niger follow projected world trends. Since the internal price level, assuming continued adequacy of local food supply, should increase less than international prices, the rate could be closer to 4.-4.5 percent.

186. The combination of the above hypotheses would point to a modest real growth rate of GDP of 3-3.5 percent p.a. up to 1980 (base 1971) picking up to 7 percent p.a. in the following five years, resulting in an average rate of about 4.5-5 percent over the 14 years 1971-1985. These may seem modest prospects -- and it should be remembered that it is assumed no major drought will recur -- but they should be regarded in the light of past trends and the current situation: there was little real growth in the early sixties and GDP stagnated from 1966 to 1972 and most probably dropped in 1973-74. The years ahead are therefore a period of recovery -- assuming no new national catastrophy -- while the eighties will witness more rapid progress. Above all, because of their hypothetical nature, the above figures should emphatically not be taken as more than a rough indication of possible lines of future development.

Balance of Payments Outlook

187. The following assumptions underlie the projections of the balance of payments. Three groups of exports have been considered: agricultural products, as analysed earlier, uranium, and "others". This last category is made up of a variety of miscellaneous products and is arbitrarily projected to represent a slightly higher proportion of total merchandise exports than in the past, since its share has been growing over time (7.5 percent in 1967-72); it is assumed to be 10 percent over the projected period, for lack of a better hypothesis. - 67 -

188. In the case of uranium the only component on which information readily exists are the quantities projected to be produced but, of course, even this may change. Some estimate of costs is necessary, however, because of their very high import content, but it must be emphasized that they are hypothetical and based on rather indirect information.

189. Present estimates are that with the improved demand outlook due to the recent rise in crude oil prices exports of uranium concentrates by SOMAIR may reach 1,500 tons in 1976 and 2,000 tons in 1979, a level which would be maintained during the following five years. Thereafter export volume would fall to less than 1,000 tons, since SOMAIR's deposits are assumed to near exhaustion by 1987, having yielded a total of about 23,000 tons. COMINAK is estimated to start production 1979, exporting 1,250 tons in that year and 2,000 tons from 1980 on. The exploitation of the deposits at IMOURAREN may begin in 1982 with exports rising from 500 tons in that year to the target of 2,000 tons by 1985. At the 1971-1972 unit price of about CFAF 5 million per ton (expected to be reached again by 1975), Niger's export earnings from uranium would thus rise from their actual 1972 level of CFAF 2.4 billion over CFAF 7.5 billion in 1976 and about CFAF 16 billion in 1979 to a peak of CFAF 27.5 billion in 1984 and would drop to a still very substantial CFAF 22.5 billion in 1986.

190. Imports required to produce one ton of uranium concentrates are estimated to have cost CFAF 2.65 million in 1972. If one applies the rate of increase of industrial export prices projected by the I.B.R.D. to this figure to obtain future current values, the following picture emerges. Imports of production inputs would soar from CFAF 2.3 billion in 1972 to CFAF 6.5 billion in 1976, CFAF 17.5 billion in 1979, and a staggering CFAF 40 billion in 1984 before declining again to CFAF 37 billion in 1986. The balance of exports less imports required to produce them (Balance A in Table 10.7 of the Statistical Appendix) would become negative by 1978; in other words, from 1978 on export earnings would cease to cover production costs. For the period 1973-1979, there would still be a surplus of CFAF 6 billion, but for 1980-1986 a deficit of CFAF 64 billion would result. Thus, no contribution to the financing of necessary equipment imports could be expected, which are estimated at CFAF 5 billion for the expansion of SOMAIR and CFAF 19 billion each for the installation of COMINAK and the company to exploit IMOURAREN, spread over the years 1973-1982.

191. Assuming, on the other hand, that the Niger Government succeeds in negotiating an increase in the export price to, say, CFAF 7.5 million per ton (or +50 percent) i:o take effect by 1975, which would subsequently be paid to the two new companies as well, no such problems would arise. Net export proceeds (Balance A) would be substantial through 1983 -- varying between CFAF 2 billion and CFAF 6.9 billion -- and would turn negative only in 1985 and 1986, which could be prevented by a 10 percent price rise in 1984. For 1973-1979, cumulative net earnings of CFAF 29 billion would be - 68 -

achieved, and for 1980-1986 the total would still amount to CFAF 16 billion. Taking investment imports into account, a net contribution to the overall balance of payments of about CFAF 2 billion would remain in both 7-year periods. Table 10.7 of the Statistical Appendix contains the full estimates for 1973-1986.

192. Imports are examined in three categories: those related to uranium (see above), petroleum products, and other imports. Petroleum products are assumed to grow by 6 percent p.a. in volume or less than in the past (8 percent p.a.) to reflect (a) the fact that the starting base (1960) was very low and therefore relative increases in the sixties were very high, (b) the effect of higher prices on demand and (c) the partial substitution to be provided by the transmission line from Kaindji (Nigeria) during the second half of the seventies. Prices are projected by applying a simple formula relating the increase in the price of crude oil to the increase in the price of refined products delivered in Niger. 1/ The ratio between the two is taken to be 0.57: for example, the price of crude is projected 2/ to be $13.75/brl in 1980 against $2.71 in 1973, or 5 times higher (rounded); the price to Niger would then be $7.85 or 2.9 times more (rounded) than in 1973. Regarding other imports, existing statistics do not permit to compute reasonably reliable elasticity relationships. The evidence would suggest a pattern whereby imports move in parallel with GDP in periods of slow growth (income elasticity slightly above one?), and much more rapidly in periods of accelerated growth of GDP (elasticity between 1.5 and 2?). Over a long period (1956-72) the volume of imports per capita seems to have increased only moderately: in current prices the figure was about CFAF 3,000 in the early years of independence, CFAF 4,000 in the latter sixties and CFAF 4,300' in the early seventies or an increase of 43 percent while import prices (before 1972) may have increased by 25 percent or so, but here also the statistical evidence is indeed fragile.

193. The purpose of these projections is to show the conditions of external equilibrium under a chosen assumption rather than to predict actual developments. A reasonable, simple assumption is that (a) imports per head will not decrease, and (b) the unit value of imports will follow the projected index of international prices (as currently projected by the Bank - June 1974). It is also a useful assumption because, while implying what is probably a minimal growth of imports, it would lead nevertheless to substantial current deficits.

194. At the same time, since GDP per head will grow -- though only moderately -- this hypothesis implies an income-elasticity of imports of less than unity. In Niger's open economy, with limited possibility for import substitution, this will not be achieved easily, thus some import restrictions may be in order (but only when and if the current deficit becomes unmanageable,

1/ Besides, this relationship is derived from observations for.Upper Volta. 2/ June 19, 1974 (Price forecasts of major etc ...), "high" hypothesis. - 69 -

that is to say, aid is insufficient, in which case they should be made via tariff increases rather than quotas that are more difficult to administer and may lead to distortion of the price system and excessive protection). However, the recommended strategy, which gives much more emphasis than in the past to agriculture, should entail a lower import content of development expenditures (in the recent past capital goods represented 32 percent of mer- chandize imports). Also, the high rates of projected price increase should work toward suppressing somewhat the volume of imports.

195. No n-factor services are a mixture of very different items, some poorly identified, and not amenable to straightforward hypothesis. As in the past, they will represent a net negative entry in the balance of payments, mainly because of the cost of foreign technical assistance. 1/ It is assumed that for the rest of the decade the real value of this item will remain constant, i.e. its current value will increase as international prices. Other services (freight, insurance, travel, etc.) will increase also, but the net effect will be small as there are some credit items for Niger (for example, transport revenue from OCDN, the railway and transport enterprise jointly operated with Dahomey).

196. In the absence of known foreign private investment of importance outside the uranium sector and in view of the apparently modest profitability of uranium production, and also the fact that external debt will remain small, factor services, which now constitute a small item, are projected to grow only moderately.

197. The combination of the various assumptions made so far results in the hypothetical current balance for the rest of the decade given in Table 17; still more tentative figures are shown for 1985.

198. As projected, the current balance of payment would imply financing requirements of more than CFAF 65 billion ($260 million approx.) over the six years 1975-80, or an average of CFAF 11 billion ($43 million) per year. The current deficit in the preceding six years (1968-73) was about CFAF 42 billion, that is of the same order of magnitude in real terms. 2/ Amounts of this order should raise no particular difficulty since external aid is currently CFAF 9-10 billion annually (not counting exceptional food aid), though it has been rising very moderately over the years. This conclusion should be inter- preted, however, in the light of a number of important considerations that have been mentioned on (lifferent occasions earlier in this report -- not to speak of the poor statistical base on which all projections have been built.

1/ Foreign technical assistance is included as a current import of Niger (tinder "Government not included elsewhere") and a corresponding item is included as a credit under Government transfers. 2/ The exceptionally bad performance of 1974 on account of the drought is excluded from the comparison. - 70 -

Table 17: BALANCE OF PAYMENTS CURRENT ACCOUNT (Billions of CFAF)

1972 1975 1976 1977 1978 1979 1980 1985 Max. Min.

Exports, goods Agricultural products 11.4 11.9 16.6 17.8 20.2 21.6 23.2 51.6 51.6 Uranium (net)* 2.4 5.1 4.7 4.2 4.2 6.9 6.8 10.2 -1.2 Other & unofficial 2.4** 2.1 2.3 2.4 2.7 3.2 3.3 6.8 5.8

Total 16.2 19.1 23.6 24.4 27.1 31.7 33.3 68.6 58.6 Imports, goods Petroleum products 1.3 3.7 4.1 4.5 5.0 5.6 6.2 Other 18.7 24.6 27.1 29.7 33.4 36.8

Total 20.0 24.3 26.7 31.6 34.7 39.0 43.0 86.0 74.0

NF Services, net -1.7 -3.0 -3.2 -3.2 -3.4 -3.5 -3.7 -5.2 Resource balance -5.5 -8.2 -6.3 10.5 -11.0 -10.8 -13.4 -22.6 -19.6

Factor payments -0.4 -0.7 -0.8 -0.8 -0.8 -0.9 -1.0 -1.5 (interest on debt) (0.2) (0.4) (0.5) (0.5) (0.5) (0.6) (0.6)

Current balance -5.9 -8.9 -7.1 -11.3 -11.8 -11.7 -14.4 -24.1 -21.1 Current balance ($ million) -23.6 -35.6 -28.4 -45.2 -47.2 -46.8 -57.6 -96.4 -84.4

* Balance A (high price); see Statistical Appendix, Table 10.7.

** Exceptionally high figure; projection based on trend 1967-71.

199. While the size of the future current deficits may appear rather moderate, it should be noted that the short-term outlook is such that Niger's foreign exchange reserves -(and Government liquid resources) will be low or very low at the outset of 1975. Some reconstitution of reserves may be necessary over the years -- though there is no need to aim at the high level of the recent past. This could be achieved if aid increased in parallel with international prices as it would then be around CFAF 80 billion for the 1972-80 period.

200. Secondly, as already pointed out, the import projection is certainly low. Unless severe droughts recur and again depress incomes -- in which case more food aid will be required -- import growth is likely to be more rapid - 71 -

than projected; thus, if the volume of imports increased twice as fast as population, still a modest rate, the deficit would increase by roughly another CFAF 4 billion during 1975-80.

201. Thirdly, if the Government program for the next decade called for public investment (outside the mining sector) averaging CFAF 12 billion annually, at 1972/73 prices (the time when the program was drafted), meaning an average of CFAF 15-16 billion in.current terms over the 1975-80 period, aid requirements would also increase by CFAF 4-5 billion. This is so because one assumption underlying the balance of payments projections is that local participation in development expenditures will remain very limited and external aid will have to finance a sizeable proportion of local costs, as in the past. Limited absorp- tive capacity may keep the effective flow of aid below the CFAF 16 billion mark, but the likelihood of aid requirements being somewhat more than the projected CFAF 11 billion annually is relatively strong nevertheless.

202. Finally, as repeatedly said before, the permanent constraints upon Niger's development, the profound uncertainty not only about yearly weather conditions but also about future climatic trends, the unknowns regarding official policies, including that concerning aid, and the unpredictable conditions of world markets are sufficient reason to consider all projections made here as a starting point in helping to design policies rather than as predictions of any sort.

After the Next Decade

203. A favorable element until the mid-eighties will be the continued growth of exports; thus, as a result of the reconstitution of the herd and improved exploitation rates, the volume of livestock exports could double between 1980 and 1985; tide volume of exportable groundnuts and cotton could still grow by 20 percent; similar increases are possible for secondary agricultural exports. 1/ If prices increase further more or less in line with world inflation rates, sLzeable additional receipts from traditional exports can be expected.

204. On the other hand, it would appear that uranium exports will produce net earnings for the country only if prices go up beyond the 50 percent increase projected for the near term (see Statistical Appendix, Table 10.7). But, above all, as time passes the effect of population growth will be more acutely felt. This is the result of two important characteristics of the proposed agricultural strategy. First is the fact that the growth of production does not, by and large, require additionaL labor inputs (it will require a little more labor per farmer, but not more farmers), which in turn is due to the intensification of land use (through appLication of new inputs and techniques) rather than the expansion of cultivated area, land being a scarce factor. Secondly, also

1/ See Volumes II and '[II, especially Annex XIV. - 72 -

because of land shortage, after the mid-eighties, when the productivity operations have reached maximum coverage, when the animal herd has reached its optimum size, and when the more easily accessible part of the irrigation potential has been fully developed, agricultural production will tend to level off.

205. The two foreseeable consequences of these facts are the likelihood of growing unemployment of rural labor, even before the mid-eighties, and the likelihood of food shortages after the mid-eighties.

206. There are, conceivably, various solutions out of this rather bleak perspective. One is a significant decrease in population growth through a decline of fertility rates: however, even if put into effect soon (which is unlikely), an active population policy will not have consequences before the end of the century. The orientation of agricultural production toward food crops and away from export crops would buy time, but it is only conceivable if other export sectors develop sufficiently -- for example, minerals. Some as yet unforeseen technological "revolution" in agriculture that would permit yield increases well beyond what current technology permits is another solution, in theory. Finally, a less dramatic though not easily feasible policy would call for an intensification of agricultural production through massive application of capital, and technical assistance, for example by systematizing the use of fertilizers (assuming no agronomical obstacles) and of animal-drawn cultivation and developing irrigated agriculture to the limits of physical possibilities, regardless of cost. Designing a strategy for the long run will essentially mean for the Government chosing one of the solutions just outlined or a combination of them. STATISTICAL APPENDIX

Table Title

1.1 Population and Area by Region, 1973 1.2 Population by Age Group and Sex, 1973 1.3 Population of Main Urban Centers, 1973 1.4 Population Projections Through 1995 1.5 Number of Salariecl Employees

2.1 GDP at Current Market Prices by Sector (Million CFAF) 2.2 GDP at Current Market Prices by Sector (Percent) 2.3 Expenditure on GDE' at Current Market Prices (Million CFAF) 2.4 Expenditure on GDF at Current Market Prices (Percent) 2.5 Composition of Gross Fixed Capital Formation at Current Prices, (Million CFAF) 2.6 Composition of Gross Fixed Capital Formation at Current Prices (Percent) 2.7 Distribution of GDP at Current Market Prices (Million CFAF, percent) 3.1 Balance of Payments 3.2 Merchandise Exports 3.3 Merchandise Imports 3.4 Recorded Imports - Principal Products 3.5 Direction of Recorded Trade 3.6 Disbursements of Official Foreign Grants 3.7 Foreign Assets of the Central Bank and Other Monetary Institutions

4.1 External Public Debt Outstanding, December 31, 1973 4.2 Changes in External Public Debt Outstanding, 1969-1993

5.1 Government Revenue 5.2 Government Current Expenditure by Nature 5.3 Government Current Expenditure by Ministry 5.4 Government Investment Expenditure 5.5 Government Financial Transactions 5.6 Consolidated Budget of the Districts 5.7 Municipal Budgets

6.1 Evolution of the Monetary Situation 6.2 Assets and Liabilities of the Central Bank 6.3 Distribution of Cre!dit to the Private Sector (Million CFAF) 6.4 Distribution of Credit to the Private Sector (Percent) -2-

Table Title

7.1 Food Crops 7.2 Cash Crops 7.3 Groundnuts - Production and Utilization 7.4 Cotton - Production and Marketing 7.5 Livestock - Recorded Production 7.6 Recorded Imports of Food and Agricultural Products 7.7 Exports of Agricultural Products

8.1 Electricity Production 8.2 Consumption of Petroleum Products

9.1 African Consumer Price Indices, Niamey 9.2 European Consumer Price Indices, Niamey 9.3 General Consumer Price Indices, Niamey 9.h Employment in the Private Sector by Branch and Salary Level 9.5 Employment in the Public Sector by Salary Level

10.1 Contribution of F.A.C. to the Development of Niger 10.2 Status of F.E.D. Projects in Niger 10.3 Sectoral Distribution of F.E.D. Aid to Niger 10.h German (Federal Republic) Capital Aid to Niger 10.5 I.D.A. Lending to Niger

10.6 Mixed Enterprises in Niger

10.7 Estimated Contribution of the Uranium Sector to the Balance of Payments Table 1.1: POPULATION AND AREA BY REGION, 1973

Population Area Density Department/District / (Thousand) (km2) QPers./km 2)

Agadez 634209 0.11 Agadez 49.5 145,635 0.34 Arlit 13.0 207,639 0.06 Bilma 8.2 280,935 0.03

Diffa 154.2 140.216 1.1 Diffa 51.1 6,979 7.3 Maine-Soroa 75.9 15,111 5.0 N'Guigmi 27.2 118,126 0.2

Dosso 612.7 31,002 19.8 Boboye 94.9 4,423 21,5 Dogondoutchi 223.3 11,044 20.2 Dosso 159.7 7,800 17.9 Gaya 101.9 4,044 25.2 Loga 52.9 3,691 14,3

Xaradi 749.1 38,581 19.4 Dakoro 119.7 16,213 7.4 Maradi 261.6 8,045 32.5 Mayahi 125.7 6,424 19.6 Tessaoua 242.1 7,899 30.6

Niamey 995,2 90,29 1.1.0 Filingu6 18 . 24,346 7.7 Niamey (incl. city of Niamey) 271,4 8,299 32.7 Ouallam 139,1 20,497 6.8 Tera 190.4 12,444 i5.3 Tillabdry 147.0 7,975 18.4 Say 60,7 16,732 3.6

Taboua 855.4 106,677 8.0 Birni-N'Konni 164.3 4,661 55.2 Bouza 111.1 5,589 51.0 Illela 100.4 6,719 L4.9 Keita 120.8 4,860 24.9 Madaoua 127.8 4,503 28.4 Tahoua 155.0 8,805 17.6 Tchin-Tabaradene 76.0 73,540 1.0

Zinder 866.6 145,430 6.0 Gour4 103.5 88,930 1.2 Magaria 261.8 8,021 32.6 Matameye 89.7 2,109 42.5 Mirria (incl. town of Zinder) 284.1 12,423 22.9 Tanout 127.5 33,947 3.8

TOTAL 4,303.9 i,186,408 3

1/ Old administrative subdivision.

Source: UN estimates. Table 1.2: POPULATION BY AGE GROUP AND SEX, 1973

(Thousands)

Age Group Male Female Total

0-4 402 403 805 5-9 305 306 611 10-14 251 254 505

0-14 958 963 1,921

15-19 213 215 428 20-24 185 186 371 25-29 161 160 321 30-34 137 137 274 35-39 115 115 230 40-44 96 98 194 45-49 79 81 160 50-54 63 63 126 55-59 49 49 98 60-64 36 38 74

15-64 1,134 1,142 2,276

65-69 24 26 50 70-74 14 19 33 75-79 7 10 17 80- 3 4 7

65- 48 59 107

Total 2.140 2,164 4,304

Source: UN estimates. Table 1.3: POPULATION OF MAIN URBAN CENTERS, 1973

(Thousands)

Niamey 121.9 Maradi 40.0 Zinder 35.5 Tahoua 28.0 Agadez 8.3

Source: UN estimates. Table 1.4: POPULATION PROJECTIONS THROUGH 1995

(Thousands)

Assumption A Assumption B Year Growth Rate Population Growth Rate Population

1973 2.2 j 4,334 2.7 2/ 4,304 1974 2.2 4,399 2.7 4, 420 1975 2.2 4,495 2.7 4,539

1976 2.2 4,594 2.7 4, 662 1977 2.2 4,695 2.7 4,788 1978 2.2 4,799 2.7 4,917 1979 2.2 4,904 2.7 5,050 1980 2.2 5,012 2.7 5,:L86

1981 2.2 5,122 2.7 5,326 1982 2.2 5,235 2.7 5,470 1983 2.2 5,350 2.7 5,618 1984 2.2 5,468 2.7 5,x769 1985 2.2 5,588 2.7 5,925

1986 2.2 5,711 2.7 6,085 1987 2.2 5,837 2.7 6,250 1988 2.2 5,965 2.7 6,418 1989 2.2 6,o96 2.7 6,592 1990 2.2 6,231 2.7 6,770

1991 2.2 6,368 2.7 6,952 1992 2.2 6,508 2.7 7,140 1993 2.2 6,651 2.7 7,333 1994 2.2 6,797 2.7 7,531 1995 2.2 6,947 2.7 7,734

UN estimate. ?I Previous UN estimate. Table 1.5: NUMBER OF SALARIED EMPLOYEES

1962 1964 1966 1968 1969 1970 1971 1972 a) Private Sector /

Construction 2,855 3,460 3,874 3,854 4,216 2,849 Industry - 741 1,574 1,601 1,880 2,180 Trade 1,018 1,339 1,434 1,635 1,776 1,871 Transportation 858 818 1,126 1,136 1,163 1,215 Banking 260 412 514 576 66s 591 Mining - - - 226 289 466 Mechanical workshops 409 296 3o6 345 391 458 Consulting firms------365 612 527 470 328 Hotels and restaurants 203 184 207 209 210 222 Miscellaneous 716 480 690 734 786 782

Total a) 6,319 8,095 10,137 10,843 11,846 10,962 b) Public Sector a

Civil servants 4,367 4,608 4,835 5,165 5,439 5,696 other 5,231 5,940 5,947 5,652 5,588 5,634

Total b) 9,598 10,548 10,782 10,817 11,027 11,330

Grand Total 20,441 22,394 21,744

4 Figures provided by the four departments of the Inspection du Travail (Niamey, Maradi, Zinder, Agadez) of the Ministere de la Fonction Publique et du Travail. Employers and employees covered are those falling- under the Code du Travail of Niger. Besides permanent public employees the following are excluded from the figures shown here for technical reasons: salaried employees in agriculture, domestic employees, emln1oyees in sell trsad3tit-nrl handicrft and emall shops. 2/ All personnel paid by the Government budget with the exception of the gendarmerie, the staff of the postal service, and the armed forces.

Source: Ministere de la Fonction Publique et du Travail, Direction du Travail et de la Securit6 Sociale; Ministbre du D6veloppement et de la Cooperation, Service de la N6canographie (according to H. Wiesler, UN statistical expert, Emploi et Salaire dans la Republique du Niger, Niamey 1973). Table 2.1: GDP AT CURRENT MARKET PRICES BY SECTOR

(Millions of CFAF)

1966 1967 1968 1969 27-0 1971

Agriculture 53,560 53,707 50942 50,08 46,420 51950 Crops 31,452 30,344 27,964 32,123 Livestock 16,989 17,578 16,808 10,9P4 Forestry 4,001 4,520 4,893 5,679 Fisheries and hunting 1,118 1,265 1,277 1,377 Mining and quarrying 37 34 119 105 110 1,210 Manufacturing 6028 6,169 6 489 6,282 io,98o 11,920 Textiles, clothing, leather 2,385 2,359 2 2,285 Wood and wood products, incl. furniture 1,019 1,099 1,214 1,303 Oils and fats 988 893 945 777 Other foods 684 802 702 679 Other 952 1,016 1,202 1,238 Electricity and water 384 405 436 604 690 820 Construction 2,303 2,178 2,364 3,144 3,310 3,070 Trade, restaurants and hotels 13,824 13,188 13,301 14,421 15,390 14,700 Wholesale and retail trade 13,658 13,643 13,132 14,238 Restaurants and hotels 166 145 169 183 Transport, storage and communication 2,469 2,768 2 9 3,131 4 160 4 210 Land and water transport 1,695 1,904 1,681 2,011 Air transport 290 298 322 366 Other 484 566 636 754 Government services 66o7 7,128 7,442 7,855 ) General administration 3,66 3,869 3,897 4,059 ) Education 1,421 1,627 1,812 1,973 ) Medical and veterinary services 897 933 1,005 1,043 ) Defense 497 502 520 569 ) 20,620 21,240 Other 186 197 208 209 ) Other 7,223 7,679 8,o60 8,449 )

Duties and taxes on imports 3,582 3,736 3,726 3,736 ) 0 Gross domestic product (GDP) 96,017 97,592 95,518 97,808 i1,68o 109,120

Source: 1966-1969 UN estimates, 1970 and 1971 IMF staff estimates. Table 2.2: GDP AT CURRENT MARKET PRICES BY SECTOR

(Percent)

1966 1967 1968 1969 1970 1971

Agriculture 55.8 55.0 53-3 51.2 45.6 47.6 Crops (32.7) (31.1) (29.3) (32.8) Livestock (17-7) (18.0) (17.6) (11.2) Forestry ( 4.2) ( 4.6) ( 5.1) ( 5.8) Fisheries and hunting ( 1.2) ( 1.3) ( 1.3) ( 1.4) Mining and quarrying u.u 0.0 0.1 0.1 0.1 1.1 Manufacturing 6.3 6.3 6.8 6.4 10.8 10.9 Textiles, clothing, leather ( 2.5) ( 2.4) ( 2.5) ( 2.3) Wood and wood products, incl. furniture ( 1.1) ( 1.1) ( 1-3) ( 1-3) Oils and fats ( 1.0) ( 0.9) ( 1.0) ( 0.8) Other foods ( 0.7) ( 0.8) ( 0.7) ( 0.7) Other ( 1.0) ( 1.0) ( 1.3) ( 1.3) Electricity and water 0.4 0.4 0.5 o.6 0.7 0.7 Construction 2.4 2.2 2.5 3.2 353 2.8 Trade, restaurants and hotels 14.4 14.1 13.9 14.7 15.1 13.5 Wholesale and retail trade (14.2) (14.0) (13-7) (14.5) Restaurants and hotels ( 0.2) ( 0.1) ( 0.2) ( 0.2) Transport, storage and communication 2.6 2.8 2.8 3.2 4.1 3.9 Land and water transport ( 1.8) ( 1.9) ( 1.8) ( 2.0) Air transport ( 0.3) ( 0.3) ( 0.3) ( 0.4) Other ( 0.5) ( 0.6) ( 0-7) ( 0.8) Government services 6.9 7.3 7.8 8.0 ) General administration ( 3.8) ( 3.9) ( 4.1) ( 4.1) ) Education ( 1.5) ( 1.7) ( 1.9) ( 2.0) ) Medical and veterinary services ( 0.9) ( 1.0) ( 1.1) ( 1.1) ) Defense ( 0.5) ( 0.5) ( 0.5) ( 0.6) ) 20.3 19.5 Other ( 0.2) ( 0.2) ( 0.2) ( 0.2) ) Other 7 .5 7,9 P. IL ) ) Duties and taxes on imports 3.7 3.8 3.9 3.8 )

Gross domestic product (GDP) 100.0 100.0 100.0 1O0.0 100.0 100.0

Source: Table 2.1. Table 2.3: EXPENDITURE ON GDP AT CURRENT MARKET PRICES

(Millions of CFAF)

1966 1967 1968 1969

Consumption 90,002 91,804 91,024 98,112 Private (79,164) (80,161) (79,090) (85,515) Government (10,838) (11,643) (11,934) (12,597) Gross investment 8,441 8,795 9,589 6,289 Gross fixed capital formation ( 7,556) ( 7,486) ( 8,188) (10,699) Investment in livestock ( 835) ( 1,127) 882) (-4,075) Inventory change ( 50) ( 182) ( 519) ( -337)

Gross domestic expenditure 98,445 100,599 - 100,613 104,401

Exports of goods and non-factor services 12,950 12,633 11,310 10,601 Merchandise exports, f.o.b. (12,165) (11,823) (10,428) ( 9,751) Exports of non-factor services ( 785 ( 810) ( 882) ( 850) Imports of goods and non-factor services -15,576 -15,640 -16,405 -17,194 Merchandise imports, c.i.f. (-13,305) (-135315) (-15,949) (-14,657) Imports of non-factor services ( 2,073) ( 2,327) (-2,456) (-2,537)

Gross domestic product 96,017 97,592 95,518 97,808

Source: UN estimates. Table 2.4: EXPENDITURE ON GDP AT CURRENT MARKET PRICES

(Percent)

1966 1967 1968 1969

Consumption 93.7 94.1 95.3 100.3 Private (82.4) (82.2) (82.8) (87.4) Government (11-3) (11.9) (12.5) (12.9) Gross investment 8.8 9.0 10.0 6.5 Gross fixed capital formation ( 7.8) ( 7-7) ( 8.6) (10.9) Investment in livestock ( 0.9) ( 1.1) ( 0.9) (-4.1) Inventory change ( 0.1) ( 0.2) ( 0.5) (-0.3)

Gross domestic expenditure 102.5 103.1 105.3 106.8

Exports of goods and non-factor services 13.5 12.9 11.9 10.8 Merchandise exports, f.o.b. (12.7) (12.1) (11.0) ( 9.9) Exports of non-factor services ( 0.8) ( 0.8) ( 0.9) ( 0.9) Imports of goods and non-factor services -16.0 -16.0 -17.2 -17.6 Merchandise imports, c.i.f. (-13.8) (-13.6) (-14.6) (-15.0) Imports of non-factor services (-2.2) (-2.4) (-2.6) (-2.6)

Gross domestic product (GDP) 100.0 100.0 100.0 100.0

Source: Table 2.3. Table 2.5: COMPOSITION OF GROSS FIXED CAPITAL FORMATION AT CURRENT PRICES

(Millions of CFAF)

A. By Type of Capital Goods 1966 1967 1968 1969

Traditional housing 1,892 2,065 2,244 2,422 Other buildings 2,067 1,811 1,793 2,956 Roads I/ 120 73 308 751 Other construction, excluding land development works 1 631 621 684 775 Land development and preparation of plantations and orchards 1 132 156 319 352 Sub-total: construction 4,842 4,726 5,348 7,256 Transport equipment 993 1,374 1,120 963 Other machinery and equipment 1,721 1,386 1,720 2,480 Live animals 835 1,127 882 -4 07 Total capital formation 8,391 8,613 9,070 6,626 Of which: imported goods and services and duties and taxes on imports (2,283) (2,345) (2,411) (3,007)

B. By Economic Sector

Agriculture 1,028 1,352 1,288 -3,652 Livestock ( 835) (1,127) ( 882) (-4,073) Mining and quarrying 4 2 439 1,104 Manufacturing 425 296 142 1,853 Textiles, clothing, leather ( 76) ( 10) ( 1) (1,520) Electricity and water 690 983 1,033 770 Construction 747 537 582 453 Trade, restaurants and hotels 353 151 277 235 Transport, storage and communication 923 1,096 947 885 Land and water transport ( 501) ( 846) ( 661) ( 541) Government 1,795 1,604 1,336 1,844 General administration, economic services ( 368) ( 264) ( 613) (1,255) Education ( 844) ( 925) ( 455) ( 383) Other sectors 2,426 2,592 3,026 3,134 Real estate (2.351) (2,515) (2,906) (2 969) Total capital formation 8,391 8,613 9,070 6.626

/ Consumption of capital is not calculated for roads and other public construction, but is considered as intermediate consumption.

Source: UN estimates. Table 2.6: COMPOSITION OF GROSS FIXED CAPITAL FORMATION AT CURRENT PRICES (Percent)

A. By Type of Capital Goods 1966 1967 1968 1969

Traditional housing 22.6 24.0 24.7 36.6 Other buildings 24.6 21.0 19.8 44.6 Roads ! 1.4 0.9 3.4 11.3 Other construction, excluding land development works / 7.5 7.2 7.5 11.7 Land development and preparation of plantations and orchards I1 1.6 1.8 3.5 5.3 Sub-total: construction 57.7 54.9 58.9 109.5 Transport equipment 11.8 15.9 12.4 i4.5 Other machinery and equipment 20.5 16.1 19.0 37.4 Live animals 10.0 13.1 9.7 -61.4 Total capital formation 100.0 100.0 100.0 100.0 Of which: imported goods and services and duties and taxes on imports (27.2) (27.2) (26.6) (45.4) B. By Economic Sector

Agriculture 12.3 15.7 14.2 -55.1 Livestock (10.0) (13.1) ( 9-7) (-61.4) Mining and quarrying 0.0 0.0 4.8 16.7 Manufacturing 5.1 3.4 1.6 27.9 Textiles, clothing, leather ( 0.9) ( 0.1) ( 0.0) (22.9) Electricity and water 8.2 11.4 11.4 11.6 Construction 8.9 6.2 6.4 6.8 Trade, restaurants and hotels 4.2 1.8 3.1 3.6 Transport, storage and communication 11.0 12.7 10.4 13.4 Land and water transport ( 6.0) ( 9.8) ( 7-3) ( 8.2) Government 21.4 18.6 14.7 27.8 General administration, economic services ( 4.4) ( 3-1) ( 6.8) (18.9) Education (10.1) (10-7) ( 5.0) ( 5.8) Other sectors 28.9 30.1 33.4 47.3 Real estate (28.0) (29.2) (32.0) (44.8) Total capital formation 100.0 100.0 100.0 100.0

1 Consumption of capital is not calculated for roads and other public construction, but is considered as intermediate consumption.

Source: Table 2.5. Table 2.7: DISTRIBUTION OF GDP AT CURRENT MARKET PRICES

(Millions of CFAF, percent)

1966 11968 1969 A. Millions of CFAF

Compensation of employees 11,040 11,676 12,257 13,792 Government ( 6,169) ( 6,633) ( 6,919) ( 7,353) Operating surplus 75,830 76,510 73,402 73,831 Agriculture (53,446) (53,603) (50,830) (49,986) Consumption of fixed capital 3,999 4,265 4,560 4,960 Indirect taxes 5,216 5,202 5,367 5,302 Duties and taxes on imports ( 3,582) ( 3,736) ( 3,726) ( 3,736) Less: operating subsidies -68 -61 -68 -77 Gross domestic product (GDP) 96,017 97,592 95,518 97,808

B. Percent of GDP

Compensation of employees 11.5 12.0 12.8 14.1 Government ( 6.4) ( 6.8) ( 7.2) ( 7.5) Operating surplus 79.0 78.4 76.9 75.5 Agriculture (55.7) (54.9) (53.2) (51.1) Consumption of fixed capital 4.2 4.4 4.8 5.1 Indirect taxes 5.4 5.3 5.6 5.4 Duties and taxes on imports ( 3.7) ( 3.8) ( 3.9) ( 3.8) Less: operating subsidies -0.1 -0.1 -0.1 -0.1 Gross domestic product (GDP) 100.0 100.0 100.0 100.0

Source: UN estimates. Table 3.1: BALANCE OF PAYMENTS

(Millions of CFAF)

1968 1969 1970 1/ 1971 1/ 1972 2

Merchandise exports 8,517 10,268 12,854 14,041 16,290 Recorded exports, f.. b. 3/ ( 6,637) ( 7,828) (10,953) (12,175) (14,590) Unrecorded exports,o; ( 1,880) ( 2,440) ( 1,901) ( 1,866) ( 1,700) Merchandise imports P 12,781 16,188 19,662 18,196 20,000 Recorded imports, c.i.f. 3/ (10,791) (13,353) (17,022) (15,710) (17,450) Unrecorded imports 2 1,990) ( 2,835) ( 2,640) ( 2,486) ( 2,550)

Trade balance -4,264 -5,920 -6,808 -4,155 -3,710 Non-monetary gold - 24 .. grf -16 - - - Freight and insurance on merchandise 319 ° 160 230 245 250 Other transportation 176 - -45 480 400 530 Travel -318 -246 -301 -305 -320 Investment income -223 7 -376 -429 -450 -450 Government, n.i.e. -1,526-_ -1,458 -1,698 -1,780 -1,800 Other Services -1,231., 91 -753 -300 -350

Net services -2,827 -1,890 -2,471 -2,190 -2,140

Unrequited transfers 5,962 6,415 7773 7,430 8,750 Private 29 -259 48 - 50 Government 5,933 6,674 7,725 7,430 8,700 French aid ( 3,836) ( 4,534) ( 5,202) ( 5,186) ( 5,771) European Development Fund ( 1,290) ( 1,077) ( 1,392) ( 1,460) ( 2,250) U.N. organisations ( 581) ( 402) ( 618) ( 615) ( 650) Other, net ( 226) ( 661) ( 513) ( 169) ( 29)

Private capital, net 1,558 2,870 4,499 2,741 420 Medium- and long-term ( 2,008) ( 2,737) ( 5,193) ( 2,960) ( 1,120) Short-term ( -450) ( 133) ( -694) ( -219) ( -700) Official capital, net 781 1,331 691 -84 437 Drawings ( 1,194) ( 1,805) ( 1,050) ( 726) ( 1,304) Repayments ( 413) ( 474) ( 359) ( 810) ( 867)

Net capital 2,339 4,201 5,190 2,657 857

SDR allocations - - 466 386 383

Change in net foreign assets 4/ (increase = -) 183 -1,345 -2,563 -4,338 -2,270 Central bank ( -427) (-1,259) (-3,241) (-3,499) (-1,973) Other monetary institutions ( 610) ( -86) ( 678) ( -839) ( -297)

Net errors and omissions -1,393 -1,461 -1,587 210 -1,870

1/ Preliminary. 2/ Estimates. 3/ Including adjustments for valuation, coverage, and timing. 4/ Including medium- and long-term liabilities of development banks to foreign financial institutions. Source: IMF and mission estimates. Table 3.2: MERCHANDISE EXPORTS

(Quantities in 1,000 tons, values in million CFAF)

1967 1968 1969 1970 1971 1972 Q V Q V V Q V Q V Q V

Groundnuts and groundnut products 191.0 6,600 171.7 4,921 135.2 3,975 150.4 5,693 113.2 4,645 137.1 6,174 of which: Groundnuts (shelled) (176.0) (5,961) (162.4) (4,513) (128.3) (3,721) (131.9) (4,934) ( 93.3) (3,413) ( 92.2) (4,597) Groundnut oil ( 7.5) ( 531) ( 3-8) ( 330) ( 2.5) ( 191) ( 7.4) ( 566) ( 10.4) ( 967) ( 18.1) (1,221) Oilcakes ( 7.5) ( 108) ( 5.5) ( 78) ( 4.4) ( 63) ( 11.1) ( 193) ( 9.5) ( 265) ( 26.8) ( 356) Live animals 18.9 844 20.2 863 20.4 890 32.2 1,390 44.8 1,973 59.5 2,511 of which: Cattle ( 17-7) ( 709) ( 19.4) ( 779) ( 19-3) ( 771) ( 30-8) (1,232) ( 42.6) (1,703) C 55.2) (2,209) Sheep and goats ( 1.2) ( 135) ( 0.8) ( 84) ( 1.1) ( 119) ( 1.4) ( 158) ( 2.2) ( 270) ( 4-3) ( 302) Uranium concentrates ------0.4 1,978 0.4 2,370 Cotton (lint) 2,6 367 2.9 393 2.2 297 1.3 160 4.9 561 1.4 194 Hides and skins 0.4 95 0.5 87 0.9 172 0.8 185 1.2 329 o.6 221 Onions 3.0 49 2.3 46 1.8 126 4.7 326 2.8 193 2.7 182 Beans 5.7 171 12.8 385 3.9 116 10.6 318 3.0 91 0.8 37

Other 6.5 454 4.3 430 8.5 674 7.6 723 5.7 900 10.5 2,023

Total recorded exports 228.1 8,580 214.7 7,125 172.9 6,250 207.6 8,795 176.0 10,670 213.0 13,712

Unrecorded exports V (estimates) ...... 1,88o .. 2,440 .. 1,901 .. 1,866 .. 1,700

Total exports 9,005 8,690 10,696 12,536 15,412

j Preliminary. / Mainly livestock.

Source: M.D.C., Direction de la Statistique, Bulletin de Statistique; mission estimates. Table 3.3: MERCHANDISE IMPORTS

(Quantities in 1,000 tons, values in million CFAF)

1968 1969 1971 1972 1 QV 2V _2 V 2V 2V

Total recorded imports 105.5 10,237 / 108.9 12,570 143.0 16,213 121.3 14,975 159.9 16,576

By type of end-use and principal user:

Final consumption 35.9 2,395 33.9 2,609 39.1 3,206 33.7 3,144 44.8 3,850 Intermediate consumption 58.8 4,442 63.9 5,355 91.4 7,805 75.9 6,475 104.2 7,898 Agriculture ( 1.2) ( 73) ( 2-7) ( U4) ( 2.6) ( 153) ( 1.0) ( 69) ( 1.0) ( 71) Tndustry. transpnrtnfi-n 57.6) 7 8 ' ) (',24.) 'Ummn (7,.52).T4.8).6,4-6j (W°.2) 2 Capital formation 8.5 3,148 11.1 4,606 12.4 5,202 11.7 5,356 10.8 4,827 Households (1.5) ( 551) (1.4) ( 551) ( 1.6) ( 688) ( 2.2) ( 825) ( 1.6) ( 795) Agriculture ( 1.0) ( 404) ( 0.5) ( 192) ( 0.9) ( 458) ( o.6) ( 310) ( 0.7) ( 293) Industry ( 6.o) (2,193) < 7.2) (3,674) ( 8.4) (3,739) ( 8.0) (3,884) ( 7.0) (3,546) Other , _ ) ( _ ) (2.0) ( 189) ( 1.4) ( 317) ( 0.9) ( 338) ( 1.5) ( 193)

By type of product and principal user:

Food products 14.7 1,124 16.4 1,335 17.5 1,562 13.3 1,377 21.9 1,971 Energy 43.1 413 38.9 417 50.1 520 55.9 987 59.1 1,281 Raw materials 9.1 211 7.6 209 19.5 553 8.5 2'6 18.9 474 For agriculture (- ) ( -) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) For industry ( 9.1) ( 211) ( 7.6) ( 209) (19.5) ( 553) ( 8.5) ( 246) ( 18.9) ( 474) Semi-finished products 8.0 494 8.2 583 11.5 971 8.9 874 14.1 1,110 Investment goods 8.5 3,148 9.1 4,417 11.0 4,885 10.8 5,018 9.3 4,634 For agriculture ( 1.0) ( 404) ( 0.5) ( 192) ( 0.9) ( 458) ( o.6) ( 310) ( 0.7) ( 293) For industry ( 6.o) (2,193) ( 7.2) (3,674) ( 8.4) (3,739) ( 8.0) (3,884) ( 7.0) (3,546) For households (1.5) ( 551) (1.4) ( 551) ( 1.6) ( 688) (2.2) ( 825) ( 1.6) ( 795) Other products 19.7 4,593 28.7 5,609 33.4 7,722 23.8 6,473 36.4 7,106 For agriculture ( 1.2) ( 73) ( 2.7) ( 114) (2.6) ( 153) ( 1.0) ( 69) ( 1.0) ( 71) For industry (16-3) (3,449) (21.6) (4,236) (27.0) (5,855) (19.6) (4,666) ( 29.9) (5,423) For households ( 2-3) (1,072) ( 2.4) (1,070) ( 2.4) (1,398) ( 2-3) (1,400) ( 4,1) (1,419) For other users ( ) ( - ) (2.0) (189) ( 1.4) (317) ( 0.9) (338) ( 1.5) (193)

Unrecorded imports (estimates) .. 1,990 . 2,835 .. 2,640 2,486 2,550

Total imports 12,227 15,405 18,853 17,461 19,126

j/ Preliminary. 2/ Including unallocated products.

Source: M.D.C., Direction de la Statistique, Bulletin de Statistique; mission estimates. Table 3.4: RECORDED IMPORTS - PRINCIPAL PRODUCTS

(Quantities in 1,000 tons, values in million CFAF)

1968 1969 1970 1971 1972 V V V 2 V V TOTAL 105.5 10,237 108.9 12,570 143.0 16,213 121.3 14,975 159.9 16,576 Milk, milk products; eggs 0.7 111 0.5 83 1.0 114 0.7 143 0.8 Wheat flour 170 2.8 120 3.5 124 4.9 228 3.4 117 4.0 150 Cola nuts 2.6 184 2.4 170 2.0 140 1.5 141 2.3 Sugar 192 3.4 193 7.6 422 9.0 514 6.9 448 10.6 789 Beer, wine, other alcoholic beverages; vinegar 3.0 240 3.5 283 1.9 212 1.5 182 1.6 186 Cigarettes 0.2 153 0.2 139 0.3 221 0.3 227 0.5 Salt 245 8.4 136 6.3 101 13.3 180 7.8 110 12.8 151 Automobile gasoline 13.3 155 11.8 154 14.2 172 14.5 276 15.1 341 Other petroleum products 31.5 342 28.7 353 36.8 431 42.4 907 45.2 1,051 Patent medicines 0.2 183 0.1 150 0.2 254 0.3 326 0.2 250 Tires and tubes o.6 256 o.6 214 0.7 312 0.5 253 0.6 Paper, cardbort 284 0.8 152 0.8 157 1.1 199 0.9 123 0.9 201 Cotton prints 2/ 1.0 828 1.4 1,272 1.6 1,672 1.1 1,368 1.6 1,936 Other cotton fabrics - 2.6 1,010 2.2 967 4.5 3,055 1.4 683 1.1 552 Bags 2.1 98 2.7 103 3.9 295 1.5 90 1.6 184 Iron and steel 5.3 412 7.0 804 8.6 1,043 6.6 804 9.8 913 Mechanical equipment and parts 1.9 936 2.8 2,163 2.2 1,435 1.6 1,472 1.8 1,408 Electrical equipment 0.7 431 0.8 575 1.2 797 0.9 626 1.5 983 Vehicles and parts 4.0 1,543 2.4 1,096 4.3 1,954 4.0 2,207 3.8 1,896 of which: Passenger cars and buses with less than 22 seats ( o.6) ( 256) ( o.6) ( 245) ( 0.8) ( 348) ( 1.0) ( 450) ( 0.8) ( 399) Trucks and pick-ups ( 0.8) ( 262) ( 0.6) ( 278) ( 1.0) ( 467) ( 1.4) ( 654) ( 1.0) ( 480) Spare parts ( 0.2) ( 159) ( 0.1) ( 138) ( 0.2) ( 172) ( 0.2) ( 165) ( 0.2) ( 230) Optical and precision equipment 0.0 101 0.1 110 0.1 185 0.1 248 0.1 219 Subtotal 85.1 7,584 85.4 9,440 111.8 13,413 97.9 10,811 115.9 12,101 ercent of total) (80.7) ( 74.1) (78.4) ( 75-1) (78.2) ( 82.7) (80.7) (72.2) (72.5) ( 73.0)

/ Preliminary. / Containing at least 85 percent cotton.

Source: M.D.C., Direction de la Statistique, Bulletin de Statistique. Table 3.5: DIRECTION OF RECORDED TRADE

(Percent of total value)

1967 1968 1969 1970 1971 1972 1973 1/ A. Exports

E.E.C. 2/ 76.5 69.0 67.6 64.1 57.0 51.5 61.9 of which: France ( 75.8) ( 56.6) ( 62.7) ( 46.7) ( 51.6) ( 38.4) ( 50.7) Germany (Federal Republic) ( 0.0) ( 0.1) ( 0.2) ( 0.5) ( 0.9) ( 6.7) ( 5.2) Italy ( 0.7) ( 11.3) ( 3.9) ( 14.9) ( 3.4) ( 5.2) ( 5.9)

United Kingdom 0.0 0.2 0.4 0.4 1.9 1.1 2.5

Nigeria 15.1 19.6 16.1 19.8 25.6 27.5 25.9

U.D.E.A.O. 3/ 4.2 8.1 8.7 9.9 7.7 5.4 5.8 of which: Ivory Coast ( 1.4) ( 2.3) ( 3.3) ( 4.0) ( 2.5) ( 2.2) ( 1.1) Mali ( 0.0) ( 0.1) ( 0.1) ( 0.1) ( 0.1) ( 1.3) ( 1.2) Dahomey ( 2.0) ( 3.5) ( 3.1) ( 4.3) ( 4.5) ( 1.1) ( 2.0)

Ghana 1.2 1.3 2.4 2.7 1.1 0.6 1.1

Other countries 2.9 1.9 4.8 3.1 6.7 13.9 2.8

Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 (CFAF million) (8,580) (7,125) (6,250) (8,795) (10,670) (13,712) (13,817)

B. Imports

E.E.C. 2/ 59.3 59.3 62.1 61.5 60.7 62.4 59.7 of which: France ( 48.1) ( 47.4) ( 48.7) ( 45.8) ( 43.2) ( 46.6) ( 43.2) Germany (Federal Republic) ( 3.8) ( 6.3) ( 6.4) ( 7.8) ( 7.7) ( 8.0) ( 7.8) Netherlands ( 4.1) ( 2.9) ( 4.3) ( 4.8) ( 5.3) ( 4.5) ( 3.6)

United Kingdom 2.1 2.4 1.8 2.3 3.8 2.6 3.8

U.D.E.A.O. 3/ 10.9 10.5 9.7 11.3 8.4 10.4 6.1 of which: Ivory Coast ( 5.9) ( 6.2) ( 4.5) ( 5.2) ( 5.4) ( 7.6) ( 3.6) Senegal ( 3.6) ( 3.3) ( 4.1) ( 5.4) ( 2.0) ( 1.9) ( 0.9)

U.S.A. 5.4 7.2 5.1 5.3 7.8 4.9 7.5 Nigeria 2.2 2.5 2.0 1.4 2.3 2.8 5.5

Other countries 20.0 18.1 19.3 18.2 17.0 16.9 17.5

Total 10.0 100.0 100.0 100.0 100.0 100.0 100.0 (CFAF million) (11,352) (10,237) (12,570) (16,213) (14,975) (16,576) (19,098)

1/ Preliminary. 2/ Belgium-Luxemburg, France, Germany (Federal Republic), Italy, Netherlands. 3/ Union Douani're des Etats de l'Afrique de l'Ouest: Dahomey, Ivory Coast, Mali, Mauritania, Niger, Senegal, Upper Volta.

Source: M.D.C., Direction de la Statistique, Bulletin de Statistique, B.C.E.A.0., Indicateurs 6conomiques nigeriens. Table 3.6: DISBURSEMENTS OF OFFICIAL FOREIGN GRANTS

(Millions of CFAF)

1968 1969 1970 1971 j972

French aid 3,836 4,534 5,202 5,186 5,771

Fonds d'Aide et de Cooperation (F.A.C.) 3,602 3,668 3,617 3,556 4,240 Subsidies ( 773) ( 333) ( 514) (1,000) Project grants (1,113) (1,507) (1,933) (1,610) (1,770) Technical assistance (2,414) (1,218) (1,289) (1,362) (1,400) Other ( 75) ( 170) ( 62) ( 70) ( 70) Other French aid 234 866 1,585 1,630 1,531 Subsidies ( 138) ( 497) (1,234) (1,354) (1,400) Technical assistance (- ) (307) ( 130) (-) (-) Other ( 96) ( 62) ( 221) ( 276) ( 131)

European Development Fund (F.E.D.) 1,290 1,077 1,392 1,460 2,250 Subsidies ( 216) ( 105) ( 172) ( 199) ( ) Technical assistance (1,074) ( 972) (1,220) (1,261) ( *- )

United Nations 581 402 618 615 650 Technical assistance (378) ( * -)(263) (.) ( ) Other (203) (3) (555) (..) (*-)

Other official grants 642 1,214 1,184 839 729 U.S. - A.I.D. ( .. ) ( .. ) ( 235) ( 250) ( 250) Canada ( .. ) ( .. ) (171) ( 200) ( 200) Federal Republic of Germany ( .. ) ( .. ) ( 162) ( 82) ( 100) People's Republic of China ( .. ) ( .. ) ( 126) ( 130) ( 179) Other ( ) (. ) (490) ( 177) ( -)

Total 6, 49 7,227 8,596 8, i,40

1/ Preliminary. / Estimates.

Source: I.M.F. Table 3.7: FOREIGN ASSETS OF THE CENTRAL BANK AND OTHER MONETARY INSTITUTTONS (Millions of CFAF/SDR, end of period)

1968 1969 1970 1971 1972 CFA SDR CFA SDR CFA SDR CFA SDR CFA SDR

Central bank (net) 580.4 2.35 1,839.7 6.62 5,081.0 18.29 8,580.3 30-90 10,553.2 38.oo

Foreign assets 654.7 2.65 1,870.1 6.73 5,199.7 18.72 8,592.1 30.94 10,557.6 38.02

Reserve position in the IMF ( 277.7) ( 1.12) ( 381.8) ( 1.37) ( 571.4) ( 2.06) ( 578.1) ( 2.08) ( 578.1) ( 2.08) SDR hn1di- - ' ( == , _ 466.4 ( . 66) ( 849.6) ( 3-O°) (1,232.1) ( 4.44) Foreign exchange ( 377.0) ( 1.53) (1,488.3) ( 5.36) (4,161.9) (14.98) (7,164.4) (25.80) (8,747.4) (31.50)

Foreign liabilities 74.3 0.30 30.4 0.11 118.7 0.43 11.8 0.04 4.4 0.02

Commercial bank (net) -721.5 -2.92 -450.7 -1.62 -711.2 -2.56 -180.7 -0.65 -243.3 -0.88

Foreign assets 280.1 1.13 196.8 0.71 135.3 0.49 474.6 1.71 213.7 0.77

Foreign liabilities 1,001.6 4.05 647.5 2-33 846.5 3.05 655.3 2.36 457.0 1.65

Development banks (net) -588.4 -2.38 -757.9 -2.73 -1,178.1 -4.24 -871.3 -3.14 -516.7 -1.86

Foreign assets 224.7 0.91 377.6 1.36 142.6 0.51 640.3 2.30 1,252.3 4.51

Foreign liabilities 813.1 3.29 1,135.5 4.09 1,320.7 4.75 1,511.6 5.44 1,769.0 6.37

Short-term ( 174-3) ( 0.71) ( 0.7) ( 0.00) ( 6.4) ( 0.02) ( 55.7) ( 0.20) ( 399.1) ( 1.44) Medium- and long-term ( 638.8) ( 2.58) (1,134.8) ( 4.09) (1,314-3) ( 4.73) (1,455.9) ( 5.24) (1,369.9) (4.93) Postal checking system (net) 96.5 0.39 80.2 0.29 83.0 0.30 84.4 0.30 89.7 0.32

Foreign assets 96.5 0.39 80.2 0.29 83.0 0.30 84.4 0.30 89.7 0.32

Total foreign assets (net) -633.0 -2.56 711.3 2.56 3,274.7 11.79 7,612.7 27.41 9,882.9 35.59

Foreign assets 1,256.0 5.09 2,524.7 9.09 5,560.6 20.02 9,791.4 35.26 12,113.3 43.62

Foreign liabilities 1,889.0 7.65 1,813.4 6.53 2,285.9 8.23 2,178.7 7.85 2,230.4 8.03

Note: CFA figures have been converted into SDR at the official rate of exchange, namely 246.853 CFAF for 1968 and 277.71 CFAF thereafter.

Source: I.M.F. Table 4.1: EXTERNAL PUBLIC DEBT OUTSTANDING, DECEMBER 31, 1973 (Thousands of US dollars)

Debt Outstanding Disbursed Undisbursed Total

Governments 50hl19 25 ,07 75,826 France 21,188 230,162 Germany (Federal Republic) 11,537 11,025 22,562 Canada 14,688 1,858 16,546 United States 3,oo6 2,250 5,256 Conseil de 1'Entente - 1,000 1,000

International Organizations 14 031 6 472 20,503 I.D.A. 14TT031 18,514 African Development Bank - 1,689 1,689

Suppliers 3,111 13,032 16,103 France - 13,032 13,032 Italy 3,111 - 3,111

Private Banks 3,775 - 3,775 Italy 3,701 - 3,701 Canada 74 - 74

Publicly Issued Bonds 12 - 12 France 12 - 12

Total 71,348 44,911 116,259

Note: Debt with a maturity of over one year.

Source: I.B.R.D., Economic and Social Data Division, Economic Analysis and Projections Department. Table 4.2: CHANGES IN EXTERNAL PUBLIC DEBT OUTSTANI)ING, 1969-1993 (Thousands of US dollars)

Debt Outstanding Transactions During Period Beginning of Period Cancellations Including Service Payments and Year Disbursed Undisbursed Commitments Disbursements Principal Interest Total Adjustments (1) (2) (3) (4) (5) (6) (7) (8) 1969 18,318 53,981 13,555 6,332 1,778 502 2,280 -3,903' 1970 21,511 61,855 25,263 15,770 1,343 799 2,142 399 1971 35,741 86,174 10,142 12,230 1,542 544 2,086 4,165 1972 49,499 98,939 3,198 11,722 1.661 668 2___ 1,515 1973 60,12u 101,988 21,653 12,114 1,816 1,444 3,260 -5,748

1974 71,166 116,077 - 13,159 2,490 1,895 4,385 -114,032 1975 81,835 99,555 - 11,441 3,642 2,066 5,709 - 1976 89,635 95,913 - 4,011 4,211 2,139 6,350 - 1977 89,434 91,702 - 1,177 3,902 2,055 5,957 - 1978 86,709 87,800 - 1,078 4,434 1,919 6,353 - 1979 83,353 83,365 _ 11 4,740 1,786 6,526 - 1980 78,S624 78,625 - 1 4,626 1,566 6,192 - 1981 74,000 74,000 - 4,960 1,350 6,311 - 1982 69,039 69,039 - - 5,543 1,138 6,681 - 1983 63,496 63,496 - - 5,583 905 6,488 - 1984 57,913 57,913 - - 5,852 702 6,555 - 1985 52,061 52,061 - - 2,534 507 3,041 - 1986 49,527 49,527 _ - 2,538 431 2,969 - 1987 46,989 46,989 - - 1,615 354 1,969 - 1988 45,374 45,374 - - 1,617 333 1,950 - 1989 43,757 43,757 - - 1,768 312 2,080 - 1990 41,989 41,989 - - 1,776 290 2,o66 - 1991 40,213 40,213 -- 1,498 270 1,768 - 1992 38,714 38,71h - - 1,500 258 1,758 - 1993 37,214 37,214 - - ,502 2)46 1,7148 -

Note: Excludes service on debts of US$14.0 million for which repayment terms are not available.

Source: I.B.R.D., Economic and Social Data Division, Economic Analysis and Projections Department. Table 5.1: GOVERNMENT REVENUE /

(Millions of CFAF)

Actuals Budget Estimates 1967/68 1968/69 1969/70 1970/71 761970/71 6/ 1971/72 / 1972/73 a/ 197/74 2I

TAX REVENUE 8,832 8,678 10,414 10,563 10,86i 10,440 9,987 10,216 10,991 11,435

Direct taxes 3,582 3,134 3,834 3,742 3,918 3,994 3,812 3,925 3,988 3,885

Modern income taxes 847 841 1,193 1,286 1,387 1,101 1,022 1,304 1,630 1,745 Presumptive income taxes 2,566 2,227 2,570 2,384 2,459 2,800 2,697 2,551 2,279 1,935 Poll taxes ( ) ( ) (1,826) (1,719) (1,851) (1,928) (1,857) (1,897) (1,925) (1,935) Livestock taxes ( ) ( ) ( 744) ( 665) ( 608) ( 872) ( 840) ( 654) ( 354) ( ) Other 169 66 71 72 72 93 93 70 79 205

Indirect taxes 4,994 4,919 5,850 6,oo6 6,542 5,824 5,589 5,946 6,614 7,105

Sales tax 614 738 946 1,009 1,230 916 910 1,000 1,035 1,150 Excise taxes 622 606 749 825 906 801 806 892 1,015 995 Alcoholic beverages ( ) ( ) ( 139) ( 175) ( 148) ( 186) ( 168) ( 148) ( 210) ( 180) Tobacco and tobacco products ( ) ( ) ( 251) ( 306) ( 297) ( 263) ( 285) ( 294) ( 350) ( 300) Petroleum products ( ) ( ) ( 359) ( 344) ( 461) ( 352) ( 353) ( 450) ( 455) ( 515) Duties and taxes on imports 3,104 3,075 3,529 3,677 3,593 3,521 3,318 3,456 3,822 4,143 Duties and taxes on exports 654 500 626 495 813 586 555 598 742 817

Other duties and taxes j 256 625 730 815 401 622 586 345 389 445

NON-TAX REVENUE 510 464 527 73 964 366 485 1 421 1,357 832

Income from government property | 151 53 63 93 378 45 46 365 357 382 Receipts from services, fines, levies, repayments 298 324 390 589 479 273 329 531 400 291 Extraordinary receipts 61 87 74 52 107 48 110 525 600 159

TOTAL CURRENT BUDGET REVENUE / 9,342 9,142 10,941 11,297 11825i 10,472 ii,637 12,348 12,267

REVENUE EARMARKED FOR THE F.N.I. 7] - - - 171 -0 229 244 300 560

Taxes on petroleum products 151 182 184 170 195 225 Taxes on the mining sector 20 55 45 34 65 95 National lottery _ 70 40 40 40

TOTAL GOVERNMENT REVENUE 9,342 9,142 10,941 11,468 12,132 10,80 10,701 11,881 12,648 12,627

1/ The fiscal year runs from October 1 to September 30. E/ Initial budget estimates. 3/ Revised budget estimates. / Including earmarked revenue. 5/ Including profit of the B.C.E.A.O. J Excluding accounting entries (recettes sur report gestion precedente), drawings on the Reserve Fund, contributions of public entities and external aid. | Fonds National d'Investissement, created in 1970/71.

Source: Data provided by the Nigerien authorities. Table 5.2: GOVERNMENT CURRENT EXPENDITURE BY NATURE f

(Millions of CFAF)

Actualsa Budget Estimates ~'68 '966/69 19701(1 1971/72I969/7 1969/70 2/ 1970/71 2/ t971/72 I 1972/73 2

Wages and salaries 4,357 4,496 4,758 4,879 5,182 4,598 4,787 5,165 5,491 6,033

Materials and supplies 1,887 2,088 2,477 2,398 2,523 2,255 2,276 2,546 2,551 2,799

Transportation .. .. 1,103 1,400 1,244 977 1,227 1,251 1,236 / 1,372 Housing .. ,, 268 289 348 -250 257 349 365 439 Debt service 176 298 634 670 742 597 622 747 439 / 380 Internal debt ( 35) ( 142) ( 486) (494) ( 535) ( 467) ( 446) ( 540) 156) ( 172) External debt ( 141) ( 156) ( 148) ( 176) ( 207) ( 130) ( 176) ( 207) ( 283) ( 208)

Other expenditures .. .. 894 986 1,204 837 898 1,217 1,179 1,309 Subsidies and contributions ( 373) ( 405) ( 376) ( 458) ( 495) ( 351) ( 437) ( 495) ( 533) ( 603) Participations in international and interregional organizations .. ,. ( 197) ( 216) ( 225) ( 196) ( 190) ( 225) ( 251) ( 296) Miscellaneous .. ,. ( 321) ( 312) ( 484) ( 290) ( 271) ( 497) ( 395) ( 410)

TOTAL CURRENT EXPENDITURE 8,404 9.569 10.134 10.622 11,243 9,514 10.067 11,275 11,261 / 11.332

i The fiscal year runs from October 1 to September 30. E Initial budget estimates. i Revised budget estimates. / Expenditure authorizations at the end of January 1973 exceeded the initial budget forecast by CFAF 380 million. Of this amount, CFAF 333 million represented an increase in debt service and CFAF 25 million additional transportation expenditure.

Source: Data provided by the Nigerien authorities. Table 5.3: GOVERNMENT CURRENT EXPENDITURE BY MINISTRY /

(Millions of CFAF)

Actuals Budget Estimates 1970/71 1971/72 1970/71 / 1971/72 / 1972/73 / 197/744/

National Assembly 325 338 248 338 309 276 Presidency 493 571 434 569 473 493 Human Development - - - - - 129 Information 55 60 61 67 72 89 Foreign Affairs 550 366 472 371 416 475 Development and Cooperation 149 116 151 115 178 94 Defense 1,024 1,040 1,001 1,041 1,092 1,146 Justice 97 102 95 98 109 114 Interior 1,307 1,338 1,250 1,335 1,373 1,459 Labor 75 68 75 73 74 82 Finance / 1,747 2,227 1,621 2,241 1,879 1,945 Economic Affairs 57 101 59 114 58 62 Agriculture 674 703 654 713 743 762 Public Works 203 159 203 163 163 163 Mining, Geology and Hydrology - - - - 70 80 Education, Youth 1,622 1,846 1,593 1,809 1,994 2,327 Health 907 970 899 970 1,017 1,117 Other 26 42 21 49 51 52

Common charges 1,273 1,169 1,184 1,172 1,172 1,444 Aid Fund 38 27 46 37 18 23

TOTAL CURRENT EXPENDITURE io,622 11,245 10,067 11,275 11,261 12,332

1/ The fiscal year runs from October 1 to September 30. ?.. Initial budget estimates. S/ Revised budget estimates. g/ Includes public debt service.

Source: Data provided by the Nigerien authorities. Table 5.4: GOVERNMENT INVESTMENT EXPENDITURE J .

(Millions of CFAF)

Actuals Budget Estimates 1969/70 1970/71 1971/72 1969/70 3/ 1970/71 / 1971/72 / 1972/75 / 1973/74 /

F.N.I. BUDGET | 1,092 807 1,168 J 1,507 1,589 1,704 1.616 2,130

Production 155 37 139 130 94 .. 120 139 Agriculture ( ) ( 34) ( 130) ( 78) ( 94) ( 120) ( 139) Other sectors ( ) ( 3) ( 9) ( 52) ( -) -) ( - )

Infrastructure 463 288 590 262 703 .. 905 1,055 Administration ( ., ) t 132) ( 202) ( 183) ( 253) ( 278) ( 441) Roads and bridges ( ,, ) ( 149) ( 329) ( - ) ( 339) ( 352) ( 358) Water resources ( . ) ( -) ( - ) ( 14) ( 16) (119) (104) Transport and comunication ( . ( 7) AL% 52) v 71) ; C 107) 80) Urban planning (I, ) ( _) ( 14) ( 13) ( 24) ( 49) ( 66)

Education and health - 15 53 98 68 .. 24 306

Participations 266 100 229 834 193 *- 289 242 in mixed enterprises ( 266) ( 3) ( 120) ( 832) ( 55) ( 135) ( 136) in foreign aid operations ( - ) ( 97) ( 109) ( - ) ( 138) ( 154) ( 106)

Subsidies 50 53 70 59 179 .. 112 122 Loans and advances _/ 128 148 80 124 152 *- 166 266 Other 30 166 7 - - - -

CURRENT BUDGET J 872 832 1.284 97799 1.262 1,521 1.165

Production 189 213 219 181 211 219 349 398 Agriculture ( 189) ( 213) ( 219) ( 181) ( 211) ( 219) ( 236) ( 275) Mining ( - ) ( - ) ( - ) ( - ) ( - ) ( - ) ( 113) ( - )

Infrastructure 524 583 919 668 572 1,027 1,156 750 Administration ( 6) ( 2) ( 3) ( 6) ( 3) ( 3) ( 4) ( 3) Roads and bridges ( 348) ( 514) ( 545) ( 304) ( 514) ( 545) ( 580) ( 615) Miscellaneous ( 170) ( 67) ( 371) ( 358) ( 55) ( 479) ( 572) ( 132)

Other 159 36 146 124 16 16 16 17

TOTAL INVESTMENT EXPENDITURE 1,964 1.639 2,452 | 2,480 2,188 2.966 137 3,295

J Exclidding investment expenditure financed out -of f1-reign aid. J The fiscal year runs from October 1 to September 30. J Initial budget estimates. / Revised budget estimates. 5 Special investment budget for 1969/70 and budget of the National Investment Fund starting 1970/71. Excluding expenditure financed out of suppliers' credits (CFAF 614 million). | Including prefinancing operations. J Part of Title IV, Government Interventions.

Source: Data provided by the Nigerien authorities. Table 5.5: GOVERNMENT FINANCIAL TRANSACTIONS 1/ (Millions of CFAF)

Actuals Budget Estimates 1967/68 1968/69 1969/70 1970/71 1971/72 1969/70 2/ 1970/71 2/ 1971/72 3/ 1972/73 2/ 1973/74 2/

Government revenue 9,342 9,142 10,941 11,468 12,132 10,806 10,701 11,881 12,648 12,627 Government current expenditure 4/ 8,404 9,369 10,134 10,622 11,243 9,514 10,067 11,275 11,261 12,332

Current surplus or deficit 938 -227 807 846 889 1,292 634 606 1,387 295

Government investment expenditure .. .. 1,964 1,639 2,452 2,480 2,188 2,966 3,137 3,295 Investment/F.N.I. budget 5/ ( 961) ( 627) ( 1,092) ( 807) ( 1,168) ( 1,507) ( 1,389) ( 1,704) ( 1,616) ( 2,130) Current budget ( ) ( ) ( 872) ( 832) ( 1,284) ( 973) ( 799) ( 1,262) ( 1,521) ( 1,165)

Budget deficit .. .. -1,157 -793 -1,563 -1,188 -1,554 -2,360 -1,750 -3,000

Deficit financing

External resources 305 449 1,170 500 1,328 1,188 1,279 1,607 1,000 3,000 Subsidies ( 260) ( 354) ( 896) ( 500) ( 1,328) ( 362) ( 1,233) ( 1,328) ( 1,000) ( 3,000) Loans and credits ( 45) ( 95) ( 274) (- ) (- ) ( 826) ( 46) ( 279) (- )

Internal resources .. .. -13 293 235 - 275 753 750 - Contributions of public entities 6/ ( - ) ( - ) ( 250) ( 250) ( 200) ( - ) ( 230) ( 450) ( 750) ( - Other, net 7/ (.) (.) ( -263) ( 43) ( 35) ( - ) ( 45) ( 303) (- ) (-

Total financing .. .. 1,157 793 1,563 1,188 1,554 2,360 1,750 3,000

1/ Excluding public works equipment utilization budget, municipal and district budgets. 2/ Initial budget estimates. 3/ Revised budget estimates. 4/ Including debt service. 5/ Excluding service on debt incurred before the creation of the F.N.I. already entered in the current budget. 6/ SONARA and CSPPN. 7/ Including errors and omissions.

Source: Tables 5.1 to 5.4 and mission estimates. Table 5.6: CONSOLIDATED BUDGET OF THE DIST-RICTS

(Millions of CFAF)

Actuals Budget Estimates 1969/70 1970/71 1971/72 1970/71 1971/72 1972/75

Revenue 919 850 881 1,057 1,159 1,183

Expenditure 950 900 964 1,057 1,159 1,183

Current expenditure (796) (764) (767) ( 883) ( 887) ( 940) Investment expenditure (154) (136) (197) ( 174) ( 272) ( 243)

Deficit -31 -50 -83 - -

Deficit financing

Government subsidies 15 19 20 Net borrowing and change in cash balances 16 31 63

Source: Ministry of the Interior, Budgets of Territorial Entities. Table 5.7: MUNICIPAL BUDGETS

(Millions of CFAF)

Budget Actuals Estimates -1969/70 1970/71 1971/72 1972/73

Revenue 431 574 1,181 582

Niamey 229 325 930 327 Maradi 88 131 132 125 Zinder 82 83 86 70 Tahoua 32 35 33 60

Expenditure 414 559 870 582

Niamey 212 512 623 327 Maradi 88 129 129 125 Zinder 82 83 85 70 Tahoua 32 35 33 60

Surplus 17 15 311

Source: Ministry of the Interior, Budgets of Territorial Entities. Table 6.1: EIVOLUTIONOF THE MONETARY SITUATION

(Millionsof CFAF, end of period)

1968 1969 1970 1971 -1972 Sept. usec. Sept. Dec. Sept. De. Sept. Dec. Sept. Dec.

Foreign assets 1-3584 L 256.0 2.6i7.3 2j54l 5)9.5 5,56.6 912§,4!22L142±826 12L113 Centralbank ~~~~~~ ~ ~~~~~997.68T 1794.7 1,870.1 4,695. 8,9. ,31 0592 .1 9,521.2 10,557 s Development banks1' 258.9 224.7 736.2 377.6 236.4 142.6 1,534.4 640.3 2,767.7 1,2S2.3 Connrc ial bank _j' 8.:2 280.1 8.9 196.8 317.4 135.3 726.8 4'74.6 50.0 213.7 Postal checking systen 93.7 96.5 77.5 80.2 80.2 83.0 84.4 84.4 89.7 89.7 Foreignliabilities s66.o 1,250.2 l.o66.i 6 1,062.9 7112 839.4 722 1,316o 860.5 Commeroial back 457.0 l,oo7.4 856.4 647-.5 922.9 84.5 71 1 653624 47. Devlopment books - 174.3 200.0 S.f 15.6 6.4 17.0 55 7 472.1 599.1 Centralbook 109.0 74.3 9.7 30.4 111.4 118.7 103.3 11S 222.56 4.4 Net foreignasaneto 7922,4 s.8 1,561t2 1,846j,1 4,266.6 4,589.0 84 2±69 9.022 6 i12±1 11,1252.6 Centralbank 58.80.4 1,785.0 1,859.7 4,584.1 5,o8i.0 669.3 8,5810.5 9.295.7 10.Y33.2 9 Development bonko 258.9 50.4 536.2 376.9 220.8 136.2 1,517.4 584.6 2.295 6 J3, 2 Postalcbeobing nyaten 93.7 96.5 77.5 80.2 80.2 83.0 84.4 834 4 89 7 6q y Comenercialbock -448.8 -721.5 -847.5 -450.7 -618.5 -711.2 7.7 -185.7 -571.4 -245 3

Donestic credit 7.091.4 10 298.0 8,198.7 2.,I18. 71,69O 8,459.2 5,9. 6,67i3.2 5 022.1507

Cloimsoon governoent (net) -S65.s 88 -364.9 93.2 -827.6 -1,040.9 fljQ10 -i,696.7 -2,747 9 -,~ Advancs 49.1 782-.9' 293.5 815.7 400.0 400.0 400 0 300.0 859.5 7,3 6 D-vmopneot banks 44.2) ( 44.7) ( 1 3) ( 1.3) ( 400.0) 1 400.0) ( 400.0) 300.5) 9 556.9) 05~)7 Centralbank I' ( 4.9) ( 38.2) (292.2) (814.4) 9 - ) ( - ) ( - 3 ( . 3 9 - ) 9 Covnvrciol bankb4/ ( - ) 9 - ) ( - ) ) ( -)-) - 3 ( 3)902 6) 9 27 9) Depo-t. -172.1 -132.4 -170.5 -195.4 -471.7 -614.6 -1.4917 -1,144 -2.911 3 -2,52)3 Corrency holdings -237.0 -Ž81.0 -237.0 -251.0 -343.0 -450.0 -255.5 -4015.5 -25,4.0 -470 0 Other abort-tor onsets 5/-200.2 -981.2 -270.9 -276.1 -412.9 -406.3 -433.4 -55!72 -412.1 -3535

Claiw on poblic entitles (ncr) -288.1 -318.8 -451.9 -664.0 -626.3 -9 .54. -1.912.3 LfL -1,054 2 -1,W43.9 DeveIapnent banks 6/ -51.4 -4008 %Tg. 743,81 -385.7 -633.3 -1,295.2 -1513 -1,465 4 -13525 2 rental ceceking syotee -236.7 -168.0 -187.4 -181.o -240.6 -521.0 -317 1 -35,2.2 -5o5.E -455,7 4 Cllama on the privtate setor. 8_444,7 10 1325.5 0,,,6 10,489.7 Th412 10.AS,45. 9.515.9 i.0,16'.4 21,WJ 13.245,7 Development banks 5,873.4 7,5-18.6 6,8. 7,431.2 6,-4208 7,540.0 6t25~.l 7.25(7.3 7. 040.0 Coemmercialbank 2,366.1 3,920.7 2,576.5 2,782.4 2,314.2 2,708.1 2,399.0 2,495!.9 2,953.9 2 ~-' 2 Tr.oncry 205.2 .981.2 270.9 276.i 412.9 406.3 433.4 •F7.2 412 1 355 7

Media- and long-ternliobil-xies to foreign financ-l cnstitot.onn 533.1 1 166.8 1,134j,S 1,257.2 1,314.3 1,471.5 14,,659 1,430.1 1563(.9 Develpment books 533.1 *58B.8 t :8 1,154.8 1,257.2 1,314.3 1,471.5 1.45-59 1,450.t 1.3(9 9

Coonterpart of SDR allocation-- - - 466.5 466.5 8S2.8 Ss2.8 1.233,3 1.255 5

Money 59066.4 y_1 6 119.9 81538.1 7,il663 6,60.5 8.367.3 10,571 1 10.743.4 Corre-y I 634 . 596l 495. 1 0'9t9 2,o.25.l 4,R48 4,780.2 3,42 , . 4030.4 5910 4937 . Semonddeponito I 2,941.3 2,-195.1 3,212.7 3,757.9 3,694.2 3,964.3 4,536 9 4,6io 1 8.35397 5,.2970 Dev1lp-et banks (1,396.1) (l,',08.8) (1,737.9) (2,050.6) (2,113.1) (2,217.9) (2.285.3) (2 151 5) (3,354.8') (2.9642) Conmmerciolbank (1,164.5) (1,127.5) (1,093.0) (1,301.7) (1,071.4) (1,334.4) (1,573.1) (1,579.s) (1.961.5) (1'5 1) Pontol oceokleg nynten 380.7) 9 08.8) 9421.8) (400.6) 5 09.7) 9412.0) 9475.5) 94V95 ) 9473 6) 947-' 03

QoSsa-noney 423.6 161.4 602.9 449 2 540.6 47. 709.7 711.0 8,94.2 07v-4P5 Tine and sa-Ingsdeposits U 404.3 1,00.0 579.0 i4oi6.-9 499.2 -435.1S 204.8 343Tr 48M20 T3:1 Develpeen.t banks 5533.6) 9472.4) 9492.9) 9327.2) 9378.9) 9342.0) 9 36.4) (IF5 0) 9 15.9) 3427 Savinngnbank ( 68.3) 9 75.0) ( 83.3) 9 86.7) 9 95.3) 9 96.0) (113.4) (109.7) 9107.) lI3~4 Commereial bank ( 2.4) ( 2.6) ( 2.8) ( 3.0) ( 25.0) ( - ) ( 55.0) 9 4.1) 9 E 3) 79119 Fcre-gscorreny deponits 19.5 11.4 23.9 32.3 41.4 31.8 104.9 367.2 212 2 171 7 Devel.pnent banks 8/( - ) ( - ) 6.6) 9 11.5) ( 28.8) 9 22.4) ( 467.5) ( 344.2) ( 13 9) 9 13-50) Comnmerciolbank 9/( 19.3) ( 11.4) ( 17.3) ( 20.8) ( 12.6) ( 9.4) ( 37.4) ( 25.0) 9 25' 3) 9 3/- 7)

Other iteno (net) 1,860.7 1,156.9 1,860.3 1,642.9 2,580.0 1,966.6 2,641.5 2,151 9 3,031.5 5 5-'

jJ Banqoe de Ddveloppewent Ce So Rldp.bliq.edo Niger (PORN),Crddit do Niger (CN) and Coaise Notionale de CrOdit Agricole (CNCA). 2/ Banqoc Internationale po:r l'Afrique Occidentale (1.AO). I ncloding rediscoontof o-tono duty bills.. 4/Spe-I advance related to operationounder the bilateral trade and poymectoagreenent witb Nigeria. Coonterpart of Treasury claims on the privatenectrr. Decond and tine depositn. 7/Private sector. D>Spo-ts of embassies pa,tly related to aid prograno. 9/ Mainly deposits of e.nbscies.

Source- IMP.F Table 6.2: ASSETS AND LIABILITIES OF THE CENTRAL BANK (Millions of CFAF, end of period)

1968 1969 1470 1971 1972 Sept. Dec. Sept. Dec. Sept. Dec. Sept. Dec. Sept. Dec.

Foreign assets 997.6 654.7 1,794.7 1,870.1 4,695.5 5,199.7 6,763.1 8,592.i 9.521.2 10,557.6 Reserve position in the IMF 277.7 277.7 347.1 381.8 381.8 571.4 575.1 578.1 578.1 578.1 SDR holdings - - - - 466.4 466.4 852.6 849.6 1,232.1 1,232.1 Foreign exchange 719.9 377.0 1,447.6 1,488.3 3,847.3 4,161.9 5,335.4 7,164.4 7,711.0 8,747.4 Foreign liabilities 109.0 743 9.7 30.4 111.4 118.7 103.3 11.8 222.5 4.4 To foreign banks 106.53 60 8.3 11.7 103.3 102.8 102.1 3.5 5.3 4.4 Other 2.7 68.3 1.4 18.7 8.1 15.9 1.2 8.3 217.2 - Net foreign assets 888.6 580.4 1,785.0 1,839.7 4,584.1 5,081.0 6,659.8 8,580.3 9,298.7 10,553.2

Domestic credit 1,781.6 3.783.4 1,111.9 3,085.7 -662.0 417.4 -1,688.3 -1,402.3 -2,934.1 -2,966.9

Claims on government (net) -336.8 454.4 52.5 562.u -760.2 -977.6 -1,690.2 -1,408.5 -2,914.3 -2,894.5 Advances - 500.0 50.0 650.0 ------Rediscount of customs duty bills 4.9 238.2 242.2 164.4 ------Deposits -104.7 -2.8 -2.7 -1.4 -417.2 -557.6 -1,405.2 -1,003.5 -2,630.3 -2,424.5 Currency holdings -237.0 -281.0 -237.0 -251.0 -343.0 -420.0 -285.0 -405.0 -284.0 -470.0

Claims on banks and other financial institutions 2,123.3 3,328.9 1,o6o.2 2,521.7 133.2 1,395.0 1.7 3-0 1.1 49.0 Claims on the postal checking system 2.9 1.6 0.9 2.5 0.9 1.2 1.7 3 1.12. Claims on the commercial bank 654.9 1,235.3 834.7 1,406.7 105.3 642.1 - - - 46.4 Claims on the development banks 1,465.5 2,092.0 224.6 1,112.5 27.0 751.7 - - - -

Other assets (net) -4.9 0.1 -0.8 2.0 -35.0 - 0.2 3.2 -20.9 -121.4

Liabilities to banks and other financial institutions 45.1 115.2 29.7 145.2 33.5 165.7 88. -564.2 175.4 254.3 Currency holdings 29.9 101.4 25.8 140.8 29.9 124.8 41.6 304.0 78.3 224.5 Deposits 15.2 13.8 3.9 4.4 3.6 40.9 46.7 60.2 97.1 29.8

Counterpart of SDR allocation - - - - 466.5 466.5 852.8 852.8 1,235.5 1,235.5

Currency 2,625.1 4,248.6 2,867.2 4,780.2 3,422.1 4,866.2 4,030.4 5,96i.0 4,953.7 6,o96.5 Bills and coins issued 2,892.0 4,631.0 3,130.0 5,172.0 3,795.0 5,411.0 4,357.0 6,670.0 5,316.0 6,791.0 Currency held by the Treasury -237.0 -281.0 -237.0 -251.0 -343.0 -420.0 -285.0 -405.0 -284.0 -470.0 Currency held by banks and other 1ita-c,ciai institutions -29.9 -101.4 -25.8 -140-. -29.9 -12~.8 -41.6 -304.0 -78.3 -224.5

Source: Central Bank of West Africa (B.C.E.A.0.); I.M.F. Table 6.3: DISTRIBUTION OF CREDIT TO THE PRIVATE SECTOR (Millions of CFAF, end of period)

1968 1969 1970 1971 1972 Sept. Dec. Sept. Dec. Sept. Dec. Sept. Dec. Sept. Dec. By Type of Credit- 8,445 10,826 9,o36 10,490 9148 10 454 9 516 10, 163 1O 624 11.246 Short-term credit 6,595 8,628 6,454 8,037 6,565 7,865 6,463 6,966 7,260 7.849 Medium-term--credit- 656 665 639 576 747 717 1,056 1,113 1,318 1.306 Long-term credit 787 1,129 1,347 1,354 1,401 1,392 1,522 1,562 1,506 1,525 Participations 304 328 364 425 390 400 ZL22 /!25 42 ^th.er 103 76 232 98 45 80 53 97 111 132 By Beneficiary 8.445 10,826 9,036 10,490 9.148 10,454 9,516 10,613 10,624 11,246 Trade 4,109 5,650 3,525 4,425 3,518 4,346 3,081 3,520 2,801 5,261 Industry 575 934 1,263 1,389 1,853 2,020 2,366 2,282 2,9B0 5,3538 Construction 1.361 1,360 1,198 1,186 1,273 1,127 1.202 1,326 1,321 1.445 Transport 306 326 315 306 438 445 404 439 528 548 Financial institutions 1/ 348 468 459 597 281 481 200 202 173 185 Services 259 242 259 236 243 244 184 169 126 144 Agriculture 93 109 86 143 87 93 68 68 103 123 Other 2/ I/ 1,394 1,737 1.931 2,203 1,455 1,698 2,011 2,157 2,592 2,204 By Creditor 8,445 10,826 9,036 10,490 9,148 10,454 9,516 10,163 io.624 11.246 Development banks 5,874 7,319 6,188 7,431 6,421 7,340 6,684 7,277 7,258 8,040 Commercial bank 2,366 3,226 2,577 2,783 2,314 2,708 2,399 2,499 2,954 2,853 Treasury 205 281 271 276 413 406 433 387 412 353

By Source of Finance 8,445 10,826 9,o36 10,490 9,148 10 454 9,516 10,613 10 624 11,246 Development banks 3,192 3,869 4,043 4,345 4,424 4,622 4,688 5,412 5,497 6,565 Commercial bank 1,571 1,931 1,611 1,429 1,708 1,851 1,640 1,790 2,063 1,832 Foreign financial institutions 533 639 1,167 1,135 1,257 1,314 1,472 1,456 1,430 1,370 Postal checking system 749 693 788 686 1,103 753 1,158 983 1,091 944 Treasury 200 43 29 112 413 406 433 387 412 353 Savings bank 75 85 96 100 111 114 125 135 131 136 Central bank 2,125 3,566 1,302 2,683 132 1,394 -- 46

1'/ Mainly the Societe Nigerienne de Cr6dit Automobile (SONICA). 2, Mainly small credits to individuals which are not reported to the BCEAO's Centrale des Risques Bancaires. 3/ Including participations and other credits.

Source: I.M.F. Table 6.4: DISTRIBUTION OF CREDIT TO THE PRIVATE SECTOR (Percent)

1968 1969 1970 1971 1972 Sept Dec. Sept. Dec. Sept. Dec. Sept. Dec. Sept. Dec.

By Type of Credit 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Short-term credit 78.1 79.7 71.4 76.6 71.7 75.2 67.9 68.5 68.3 69.8 Medium-term credit 7.8 6.2 7.1 5.5 8.2 6.9 11.1 10.9 12.4 11.6 Long-term credit 9.3 10.4 14.9 12.9 15.3 13.3 16.0 15.4 14.2 13.6 Participations 3.6 3.0 4.0 4.1 4.3 3.8 4.4 4.2 4.1 3.8 Other 1.2 0.7 2.6 0.9 0.5 0.8 0.6 1.0 1.0 1.2

By Beneficiary 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 29.0 Trade 48.7 52.2 39.0 42.2 38.4 41.6 32.4 34.6 26.4 Industry 6.8 8.6 14.0 13.2 20.3 19.3 24.9 22.5 28.1 29.7 Construction 16.1 12.6 13.2 11.3 13.9 10.8 12.6 13.0 12.3 12.8 4.9 Transport 3.6 3.0 3.5 2.9 4.8 4.3 4.3 4.3 5.0 1.6 Financial institutions 1/ 4.1 4.3 5.1 5.7 3.1 4.6 2.1 2.0 1.6 1.2 1.3 Services 3.1 2.2 2.9 2.3 2.7 2.3 1.9 1.7 Agriculture 1.1 1.0 0.9 1.4 0.9 0.9 0.7 0.7 1.0 1.1 Other 2/ 3/ 16.5 16.1 21.4 21.0 15.9 16.2 21.1 21.2 24.4 19.6 100.0 By Creditor 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Development banks 69.6 67.6 68.5 70.9 70.2 70.2 70.2 71.6 68.3 71.5 Commercial bank 28.0 29.8 28.5 26.5 25.3 25.9 25.2 24.6 27.8 25.4 Treasury 2.4 2.6 3.0 2.6 4.5 3.9 4.6 3.8 3.9 3.1

By Source of Finance 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 58.4 Development banks 37.8 35.8 44.8 41.4 48.3 44.2 49.3 53.3 51.7 Commercial bank 18.6 17.8 17.8 13.6 18.7 17.7 17.2 17.6 19.4 16.3 Foreign financial institutions 6.3 5.9 12.9 10.8 13.7 12.6 15.4 14.3 13.5 12.2 8.4 Postal checking system 8.9 6.4 8.7 6.5 12.1 7.2 12.2 9.7 10.3 Treasury 2.4 0.4 0.3 1.1 4.5 3.9 4.6 3.8 3.9 3.1 Savings bank 0.9 0.8 1.1 1.0 1.2 1.1 1.3 1.3 1.2 1.2 0.4 Central bank 25.1 32.9 14.4 25.6 1.5 13.3 - - -

1/ Mainly the Societe Nigerienne de Credit Automobile (SONICA). 2/ Mainly small credits to individuals which are not reported to the BCEAO's Centrale des Risques Bancaires. 3/ Including participations and other credits.

Source: Table 6.3. Table 7.1: FOOD CROPS

A area in 1,000 ha P production in 1,000 t Y yield in kg/ha L/

1967 / 1968 1969 1970 1971 1972

Millet 3/ A 1,865 1,895 2,272 2,310 2,356 2,570 p 1,000 733 1,095 871 958 919 Y 536 387 482 377 407 390

Sorgho A 530 557 596 593 580 581 P 342 215 289 230 267 208 y 645 386 486 380 461 344

Cowpeas (niebe) A 690 744 968 980 1,000 921 P 77 74 83 84 72 144 y 112 100 86 86 72 136

Voandzou A 49 48 60 56 56 51 P 42 26 44 29 3L 21 y 844 546 723 522 588 419

Rice (paddy) A 11.5 15.3 15.5 16.4 17.1 17.2 P 32.6 39.0 38.0 37.1 27.3 31.8 Y 2,829 2,553 2,521 2,259 1.596 1,407

Corn A 4.6 3.6 2.6 2.7 2.9 3.7 P 2.6 1.8 1.5 1.6 L.9 2.3 Y 576 494 542 585 67( 457

Cassava A 23.6 26.8 27.5 24.3 24.3 18.5 P 169 198 197 182 166 95 y 7,550 7,379 7,165 7,480 6,860 7,083

Wheat A 0.6 0.3 0.2 0.4 .53 0.3 P 0.4 o.6 0.2 0.4 1.3 0.36 Y 1,300 1,480 977 900 900 819

Sweet potatoes A 1.2 1.2 1.3 1.3 L.4 1.5 P 12.6 9.7 8.8 8.3 9.5 11.9 y 10,600 8,010 6,950 6,450 6,800 7,900

Sugar cane A 1.0 1.3 1.4 1.4 1.5 1.5 P 21.3 24.7 24.9 36.8 55.8 53.6 Y 21,200 19,120 18,280 26,550 36,700 31,130

/ Average for specific regions and not overall average. U/ Last year with normal weather before the series of dry years 1968-1973. S./ Estimated 1973 product:ion: millet and sorghum approximately 800,000 t. Source: Ministry of AgricuLture, Department of Agriculture, Annual Report 1972. Table 7.2: CASH CROPS

A area in 1,000 ha P production in 1,000 t Y yield in kg/ha L/

1967 / 1968 1969 1970 1971 1972

Groundnuts (in shell) A 356.7 432.0 319.8 357.5 394.2 417.9 P 298.3 252.4 206.9 204.6 256.5 260.2 5/ y 836 584 647 572 650 385

Seed cotton A 17.2 17.3 20.2 19.9 20.6, 15.2 p 6.2 7.0 12.6 10.5 9.0 6.o Y 358 405 626 528 436 382 Onions A 2.1 1.8 1.7 1.9 2.1 1.3 p 44.1 38.7 27.4 30.7 36.o 20.3 Y 21,390 21,000 16,520 16,430 17,000 13,860

Tomatoes A 0.4 0.5 0.4 0.3 0.3 0.34 p 4.6 4.7 3.6 2.2 2.7 2.5 Y 11,730 9,580 8,075 7,490 7,740 10,840

Red pepper A 0.8 0.8 0.8 0.4 0.9 0.36 p 0.7 0.7 0.5 0.2 0.6 0.18 y 872 781 603 595 603 567

Tobacco A 0.7 0.7 0.7 0.7 0.7 o.63 p 0.2 0.2 0.2 0.3 0.5 0.25 Y 337 273 278 355 36o 445

j Average for specific regions and not overall average. U/ Last year with normal weather before the series of dry years 1968-1973. S./ Tentative estimate; a figure of 200,000 t is more likely.

Source: Ministry of Agriculture, Department of Agriculture, Annual Report 1972. Table 7.J: GROUNDNUTS - PRODUCTION AND UTILIZATION (Thousands of metric tons)

1967/68 1968/69 1969/70 1970/71 1971/72 1972/73

Production, in shell 298 252 207 205 256 260

Production, shelled 209 177 145 144 171 182

Marketed production, shelled 183 164 165 130 146 110

Balance 26 13 -20 16 25 72

Processing in Niger 21 24 33 31 58 64

Exports 162 139 131 96 85 43

In percent:

Processing in Niger 11.2 14.7 20.0 24.2 40.8 58.3

Exports 88.7 85.3 80.0 75.8 59.2 41.7

100.0 100.0 100.0 100.0 100.0 100.0

J Tentative estimate; a figure of 200,000 t is more likely. U/ Shelled weight is 0.70 of weight in shell. S/ Imports, subsistence consumption, seeds, and change in stocks.

Source: Production - Ministry of Agriculture, Department of Agriculture, Annual Reports; marketed production - SONARA. Table 7.4: COTTON - PRODUCTION AND MARKETING

.1967/68 1968/69 1969/70 1970/71 1971/72 1972/75

Seed cotton production

Rainfed cultivation Area (ha) 17,135 17,000 21,570 19,370 19,517 12,027 Production (t) 6,030 6,790 9,895 8,261 6,980 4,320 Yield (kg/ha) 351 399 458 426 357 359

Irrigated cultivation Area (ha) - 273 461 625 778 682 Production (t) - 218 623 1,336 1,292 867 Yield (kg/ha) - 797 1.351 2,138 1,660 1,270

Total marketed production of seed cotton (t) 6,030 7,007 10,518 9,597 8,272 5,187

Purchase value (1,000 CFAF) 197,394 298,782 277,348 245,328 165,517

Average price (CFAF/kg) 28.17 28.41 28.90 29.67 31.91

Average fiber yield (%) 35.86 33-52 34.90 36.19 37.23 36.10

Fiber productior (t) 2,192 2,349 3,671 3,468 3,080 1,853

Fiber exports (t) 2,192 2,349 2,675 2,918 2,065 853

Deliveries tc NITEX (t) - - 996 550 1,015 1,000

j/ CFDT figures corresponding to the part of cotton cultivation covered by extension services; they are slightly lower than those given by the Ministry of Agriculture (see Table 7.2).

Source: Production - C.F.D.T. Prices - Ministry of Development and Cooperation, Etude sur le prix du coton du Niger. Table 7.5: LIVESTOCK - RECORDED PRODUCTION

1967 1968 1969 1970 1971 1972

Slaughtering (1,000 head)

Cattle 64.6 75.8 75.1 67.0 0O.9 60.7 Sheep 81.8 94.5 96.9 92.0 38.6 104.0 Goats 331.1 312.6 384.5 381.7 398.3 396.2

Exports of live animals (1,000 head)

Cattle 60.3 67-3 64.3 101.7 143.0 181.0 Sheep 43.3 25.4 33.2 40.1 43.0 47.7 Goats 16.9 14.5 23.7 32.9 69.7 95.2

Exports of refrigerated meat (it)

Total 673.2 565.7

Of which: Beef 351.4 371.7 517.6 586.3 530.2 418.0 Mutton 99.1 158.0 139.8 103.9 85.4

Exports of smoked or dried meat (t) 90.0 72.8 168.3 95.0 45.5 79.4 Hides and skins (1,000) Processing

Hides (cattle) 164.3 179.6 250.6 232.9 166.0 146.9 Sheep skins 369.9 408.3 519.4 475.5 467.8 429.7 Geat skins 979.0 1,046.1 1,393.0 1,316.4 1,336.2 1,170.4 Exports

Hides 32.4 66.1 70.3 61.0 57.8 39.7 Sheep skins 107.0 154.0 185.7 233.7 403.1 274.7 Goat skins 554.8 906.0 900.9 1,081.4 1,357.5 389.0

Source: Ministry of Agriculture, Livestock Service. TaLble 7.6: RECORDED IMPORTS OF FOOD AND AGRICULTURAL PRODUCTS (Thousands of metric tons)

1967 1968 1969 1970 19R7 1972.L/

Milk and milk products 0.8 0.7 0.5 1.0 0.7 0.8

Cola nuts 3.7 2.6 2.4 2.0 L.5 2.3

Sugar 7.2 3.4 7.6 9.0 6.9 10.6

Wheat flour 3.5 2.8 3.5 4.9 53.4 4.0

Beer, wine, other alcoholic beverages, vinegar 3.0 3.5 1.9 1.5 1.6

Cigarettes 0.3 0.2 0.2 0.3 0.3 0.5

Cotton textiles 1.6 3.6 3.6 4.1 2.5 2.7

1/ Preliminary.

Source: M.D.C., Department of Statistics, Bulletin de Statistique. Table 7.7: EXPORTS OF AGRICULTURAL PRODUCTS

1967 1968 1969 1970 1971 1972

1) Quantities (Thousands of metric tons)

Groundnuts (shelled) 176.0 162.4 128.3 131.9 93^3 92.2 Cotton fiber 2.6 2.9 2.2 1.3 4.9 1.4 Groundnut oil 7.5 3.8 2.5 7.4 10.4 18.1 Groundnut oilcakes 7.5 5.5 4.4 11.1 9.5 26.8 Cowpeas (niebe) 5.7 12.8 3.9 10.6 3.0 0.8 Onions .30 2.3 1.8 4.7 2.8 2.7 Live animals, cattle 17.7 19.4 19.3 30.8 42.6 55.2 Meat 0.47 0.48 0.71 0.77 o.67 0.56 Hides and skins 0.4 0.5 0.9 0.8 1.2 o.6

2) Values (Millions of CFAF)

Groundnuts (shelled) 5,961 4,513 3,721 4,934 3,413 4,597 Cotton fiber 367 393 297 160 561 194 Groundnut oil 531 330 191 566 967 1,221 Groundnut oilcakes 108 78 63 193 265 356 Cowpeas (niebe) 171 385 116 318 91 37 Onions 49 46 126 326 193 182 Live animals and meat 844 863 890 1,390 1,973 2,511 Hides and skins 95 87 172 185 329 221

Unrecorded exports 2 1,880 2,440 1,900 1,866 1,700

Total value 8,575 8,016 9,972 9,358 11,019

I/ Preliminary. gS/ Estimated on the basis of 350 kg weight per head. 2 Mainly live animals (estimate).

Source: M.D.C., Department of Statistics, Bulletin de Statistique, and mission estimates. Table 8.1: ELECTRICITY PRODUCTION (Thousands of kWh)

1964 1966 1967 1968 1969 1970 1971 1972 1973

Intermediate Consumption

Textile industry 27 18 46 1,379 5,167 5,625 6,161 Food industry 789 1,002 1,318 1,275 1,293 1,473 2,867 Water supply 1,001 1,367 1,436 1,635 1,969 2,305 2,239 Trade 206 252 647 662 1,619 1,730 2,046 Electricity generation 544 605 990 1,134 1,218 1,462 1,725 Hotels and restaurants 617 986 1,216 1,210 1,416 1,496 1,575 Transport 606 1,124 1,145 1,255 1,208 1,315 1,416 Post and telecommunication 478 580 742 760 835 912 l,o66 Construction 123 295 342 318 331 462 542 Chemical industry 52 85 306 319 302 299 386 Metal industry 132 192 183 209 200 191 224 Miscellaneous and unidentified activities 492 763 722 786 887 1,072 1,297 25,054 Subtotal 5,067 7,269 8,075 9,093 10,942 16,445 18,342 21,544

Final Consumption

Public sector 4,434 4,635 5,788 5,616 5,483 6,324 6,882 Households and foreign missions 5,405 7732 10.339 13.427 13.761 13.668 16.271

Subtotal 9,839 12,367 13,848 16,127 19,043 19,244 19,992 23,153 23,860

Total 14,906 19,636 21,923 25,220 29,985 35,689 38,334 44,697 48,914

S/ Power needed to produce goods and services for the market. S/ Network losses excluded.

Source: M.D.C., Department of Statistics, Bulletin de Statistique. Table 8.2: CONSUMPTION OF PETROLEUM PRODUCTS (Cubic meters)

1967 1968 1969 1970 1971 1972 1973

Jet fuel 6,580 8,416 11,051 11,986 11,037 1o,169 15,151

Aviation gasoline 2,625 3,380 3,057 2,807 2,315 2,913 4,039

Automobile gasoline L6,998 18,190 19,031 19,469 21,212 22,860 25,69o

Petroleum 4,144 4,057 3,669 3,222 2,886 2,950 3,423

Gas oil 25.958 26,669 32,093 9o058 43,971 51,872 62.652

All products 56,305 60,712 68,901 76,522 81,421 90,764 110,955

Index 100.0 107.8 122.4 135.9 144.6 161.2 197.1

/ Preliminary. g/ Including consumption of NIGELEC.

Note: The Department of Mining and Geology participates in regulating Niger's fuel supply. The eastern part of the country is supplied from Nigeria (Kano), while the western part receives its supplies from Dahomey (Parakou) through O.C.D.N. and the pool of Nigerien fuel carriers.

Source: Service of Mining and Geology. Table 9.1: AFRICAN CONSUMER PRICE INDICES, NIAMEY (July 1, 1962 - June 30, 1963 = 100)

General Food and Beverages Dwelling and Miscel- Period Index Food Beverages Total Clothing Hous¶keeping laneous

1965 March 102.0 99.6 107.1 100.3 99.2 102.9 109.2 June 106.3 105.1 106.5 105.2 100.7 1.07.4 113.7 September 105.3 102.7 108.3 103.3 100.4 110.2 113.1 December 109.1 110.3 108.4 110.1 100.3 110.1 112.0

1966 March 111.6 115.3 106.4 114.4 101.6 107.6 112.6 June 120.4 130.6 103.2 127.9 101.3 1.15.1 113.0 September 116.9 124.6 102.9 122.5 103.9 1.07.7 113.7 December 115.5 119.9 102.1 118.1 109.6 X08.5 115.0

1967 March 114.2 113.2 114.8 113.3 111.9 111.1 120.7 June 120.4 127.1 113.9 125.8 103.7 118.8 116.1 September 117.4 121.7 113.5 120.8 106.5 1.18.8 113.5 December 113.4 112.5 115.3 112.8 109.1 115.7 118.4

1968 March 110.5 108.4 115.7 109.2 113.3 113.2 117.2 June 114.5 115.6 115.7 115.6 104.3 113.3 119.5 September 110.9 111.4 114.3 111.6 102.8 113.5 113.2 December 113.2 112.7 115.7 113.0 108.5 113.6 117.1

1969 March 126.2 136.6 116.2 134.6 108.9 113.6 118.6 June 131.8 148.5 116.2 145.3 103.3 120.8 114.8 September 127.6 137.3 116.5 135.2 107.9 121.8 120.9 December 123.6 127.5 116.6 126.4 110.0 127.6 122.5

1970 March 124.1 128.0 116.6 127.0 113.2 122.7 123.2 June 130.0 137.1 121.5 135.6 112.0 127.6 126.8 September 128.3 132.0 121.4 131.0 123.8 132.5 120.0 December 128.6 130.6 122.9 129.8 126.6 131.3 124.1

1971 March 128.7 130.8 121.7 129.9 126.6 131.3 124.4 June 135.4 144.9 127.0 143.1 115.2 138.4 123.1 September 134.0 141.1 125.6 139.5 110.0 144.2 127.6 December 131.5 138.4 112.7 135.9 110.0 144.2 125.9

1972 March 139.5 154.7 118.9 151.1 105.1 134.5 130.0 June 150.1 172.1 120.3 167.0 103.2 141.1 135.2 September 146.2 164.8 113.7 159.7 105.5 141.1 135.4 December 149.1 171.6 113.9 165.9 105.5 141.1 131.2

1973 March 155.3 182.9 113.2 176.0 105.5 141.1 133.1 June 167.7 202.2 103.4 192.3 105.5 141.1 148.7 September 164.5 201.6 103.8 191.9 104.9 141.1 137.4 December 164.2 199.4 115.2 191.0 104.9 141.1 133.5

Source: M.D.C., Department of Statistics, Bulletin de Statistique. Table 9.2: EUROPEAN CONSUMER PRICE INDICES, NIAMEY (Novemiber 15 - December 15, 1964 = 100)

General Gas, Water, Maintenance Clothing, Domestic Miscel- Period Index Foo(d Electricity Items Linen Services laneous 1965 December 103.0 103.1 106.6 104.8 io6.5 100,0 101.1 1966 March 102.7 101.8 106.6 102.0 105.5 100.0 102.8 June 105.1 107.1 106.6 100.6 104.6 100.0 106.6 September 107.7 107.6 106.6 102.1 110.0 100.0 110.7 December 108.7 107.6 106.6 104.6 109.6 100.0 114.6 1967 March 110.2 108.3 106.6 110.7 112.1 100.0 117.8 June 116.6 115.2 106.6 111.7 110.2 138.6 118.5 September 117.9 117.7 106.6 111.9 112.8 138.6 118.4 December 119.7 114.2 106.6 110.4 120.6 138.6 129.8 1968 March 119.4 114.7 106.6 111.0 121.8 138.6 128.6 June 1.21.7 118.L 106.6 112.8 122.0 138.6 129.9 September 120.7 116.1 106.6 111.0 122.0 138.6 129.9 December 120.1 114.l 106.6 112.0 121.7 138.6 131.0 1969 March 118.8 111.6 106.6 118.3 120.6 138.6 130.2 June 124.2 123.() 106.6 116.9 121.0 138.6 130.6 September 124.7 122.5 106.6 115.8 121.8 138.6 134.0 December 124.9 119.2 106.6 115.3 124.5 138.6 139.4

1970 March 125.2 118.]. 106.6 117.4 129.0 138.6 141.2 June 128.2 126.3 106.6 116.7 117.7 140.6 159.9 September 127.6 122.1 106.6 123.2 129.0 140.6 142.2 December 131.2 128.7 106.6 125.1 130.3 140.6 144.1 1971 March 131.1 124.9 106.6 132.6 148.3 140.6 145.2 June 133.3 131.8 106.6 120.5 135.1 140.6 146.0 September 133.2 130.3 106.6 122.8 134.8 140.6 147.8 December 132.0 126.8 106.6 133.6 134.8 140.6 148.7 1972 March 133.0 128.0 106.6 133.6 136.1 140.6 148.6 June 137.3 138.5 103.5 137.5 134.6 140.6 149.3 September 135.8 135.9 103.5 131.2 136.4 140.6 148.2 December 134.4 131.8 103.5 144.0 136.5 140.6 148.8

1973 March 134.5 131.3 103.5 151.1 136.4 140.6 149.4 June 140.7 145.6 103.5 150.5 136.4 140.6 147.9 September 140.5 144.4 103.5 152.6 136.4 140.6 149.0 December 140.4 141.8 103.5 151.8 136.4 140.6 153.4

Note: A survey of household expenditures of French technical assistance personnel was conducted during the period November 15 - December 15, 1964. The survey led to the establishment of the new price index for European consumption shown in this table.

Source: M.D.C., Department of Statistics, Bulletin de Statistique. Table 9.5: GENERAL CONSUMER PRICE INDICES, NIAMEY

African European Annual Increase (Percent) Consumption Consumption African European Period i/ 2 Consumption Consumption

1965 105.0 First quarter 101.8 Second quarter 104.3 Third quarter 106.2 Fourth quarter 107.5 103.4

1966 116.1 105.5 10.6 First quarter 109.4 102.0 Second quarter 116.1 103.7 Third quarter 122.5 106.3 Fourth quarter 116.3 109.2

1967 116.6 115.5 0.4 _ First quarter 114.4 110.3 Second quarter 118.4 114.4 Third quarter 119.8 117.4 Fourth quarter 113.9 119.9

1968 115.6 120.2 -2.6 4s.1 First quarter 112.5 119.4 Second quarter 112.7 120.3 Third quarter 115.2 121.1 Fourth quarter 114.0 119.9

1969 125.2 122.4 10.2 First quarter 121.2 118.7 Second quarter 127.9 122.3 Third quarter 129.6 123.9 Fourth quarter 122.3 124.6

1970 126.6 127.7 1.1 First quarter 122.7 124.6 Second quarter 126.8 127.3 Third quarter 127.7 128.4 Fourth quarter 129.3 130.4

1971 132.0 .4. First quarter 128.4 130.7 Second quarter 131.1 132.5 Third quarter 134.9 133.4 Fourth quarter 133.4 132.7

1972 144.8 155.0 9.7 2>.0 First quarter 135.1 132.7 Second quarter 146.6 135-3 Third quarter 147.2 136.0 Fourth quarter 150.5 136.0

1975 161.8 138.0 11.7 2'.2 First quarter 150.1 134-3 Second quarter 164.0 137.3 Third quarter 167.6 140.0 Fourth quarter 165.4 140.5

j July 1, 1962 to June 30, 1963 = 100. / November 15 to December 15, 1964 = 100.

Source: M.D.C., Department of Statistics, Bulletin de Statistique. Table 9.4: EMPLOYMENT IN THE PRIVATE SECTOR BY BRANCH AND SALARY LEVEL, END-1970

Monthly Salary IndustrY & Workshops Construction Trade Transport Banks (CFAF) Employees 1 Workers Employees 1/ Workers Employees i/ Workers Employees 1/ Workers Employees 1/ Total Percent Under 6,000 34 689 50 1,047 146 320 5 346 37 2,674 31.5 6,ooo to 8,000 - 604 - 445 - - - 259 - 1,308 15.4 8,000 to 10,000 104 - 59 - 262 177 43 - 97 742 8.7 10,000 to 12,000 60 343 31 576 119 47 44 99 ' 1,403 16.5 12,000 to 14,000 64 140 27 280 136 52 85 21 - 805 9.5 14,000 to 18,000 50 93 30 90 147 30 81 12 141 674 7.9 18,000 to 25,000 61 - 21 - 111 14 54 1 48 310 3.7 25,000 to 30,000 37 53 32 18 120 5 41 15 81 402 4.7 30,000 to 40,000 4 - 6 - 17 - 4 - 20 51 o.6 40,000 to 50,000 13 - - - 10 - 1 - 22 46 0.5 50,000 to 70,000 1 - 1 - 9 - - - - 11 0.1 Over 70,000 32 - 4 - 14 - 9 - - 59 0.7 Total 460 1,922 261 2,456 1,091 645 367 753 530 8,485 100.0 Average Monthly Salary 19,600 8,640 15,065 8,460 15,455 8,250 17,885 7,480 17,205 11,060 2/

1/ Excluding Europeans. 2/ Workers: CFAF 8,370; employees: CFAF 16,790.

Note: Salary levels in this table correspond to individual salaries as defined in the different salary categories of collective conventions into which a worker or employee is grouped. They are gross salaries in the sense that no social security deductions are made. On the other hand, they include neither family allowances, nor incentive payments, overtime pay, or payments in kind, etc.

Source: H. Wiesler, UN statistical expert, Emploi et Salaire dans la Republique du Niger, Niamey 1973. Table 9.5: EMPLOYMENT IN THE PUBLIC SECTOR BY SALARY LEVEL (February 1973)

Monthly Salary N u m b e r P e r c e n t (CFAF) Civil Servants Other L/ Total Civil Servants Other / Total

Under 6,000 18 546 564 0.3 9.7 5.0 6,ooo to 8,000 2 361 363 0.0 6.4 3.2 8,ooo to 10,000 3 558 561 0.0 9.9 5.0 10,000 to 12,000 33 786 819 o.6 14.0 7.2 12,000 to 14,000 39 871 910 0.7 15.5 8.o 14,000 to 16,000 140 349 489 2.5 6.2 4.3 16,000 to 18,000 1,069 723 1,792 18.8 12.8 15.8 18,000 to 20,000 475 421 896 8.3 7.5 7.9 20,000 to 25,000 755 410 1,165 13.3 7.3 10.3 25,000 to 30,000 1,071 158 1,229 18.8 2.8 10.8 50,000 to 40,000 966 270 1,236 17.0 4.8 10.9 40,000 to 50,000 395 59 454 6.9 1.0 4.0 50,000 to 60,000 226 45 271 4.0 o.8 2.4 60,000 to 70,000 193 33 226 3.4 o.6 2.0 70,000 to 80,000 99 7 106 1.7 0.1 0.9 80,000 to 90,000 45 4 49 o.8 0.1 0.4 90,000 to 100,000 31 6 37 0.5 0.1 0.3 100,000 to 150,000 106 19 125 1.9 0.3 1.1 Over 150,0oo 30 8 38 0.5 0.1 0.3

Total 5,696 5,634 11,330 100.0 100.0 100.0

Average monthly salary 33,120 16,360 24,350

1/ Auxil.iaries.

Note: Salaries in this table mean taxable salaries, equal to basic salaries plus housing allowances and other possible payments less family allowances.

Source: H. Wiesler, UN statistical expert, Emploi et Salaire dans la Republique du Niger, Niamey 1973. Table 10.1: CONTRIBUTION OF F.A.C. TO THE DEVELOPMENT OF NIGER

(Agreements signed; thousands of FF)

1967 1968 1969 1970 1971 1972 1973 i/

I General Studies 2 320 1 564 1,634 758 1.139 2.157 Scientific research 863 909 824 758 1,139 2,157 Cartography 450 Geological and mining studies 655 Hydrogeological studies 178 Hydrological studies 360 Soil and agronomical studies 1,279

1I Infrastructure I,32 11,950 2.277 4,548 2,710 7,907 10000 Road studies and construction 2,500 8,420 910 920 2,040 7,400 10,000 Road maintenance 4,440 ? 1,247 Aviation 3,260 120 Telecommunications 792 1,450 2/ 368 Water supply 2,080 550 507 Urban planning and infrastructure 120

III Rural Development 1,961 6,781 9,562 414 2066 6,046 1,949 _ _ _ _ ~ ~ ~7-~0 ~ ~~77i~, ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ - Inducement to development 3 and aid to cooperatives 67152 521 Training of agricultural staff 4,124 1,819 878 210 Equipment of agricultural services 116 90 Cotton cultivation 2,401 593 498 1,118 893 Other crops 140 822 512 937 846 Livestock and livestock production 1,284 4,766 4/ 3,008 3,470

IV Rural Development - Regional Programs and Irrigation Development 122z 1.02t 4 256 3,729 2J120 960 Ader Doutchi Maggia 12,118 2,334 4,256 2,199 2,120 Niger valley 1,530 Various ponds and valleys 12J 700 Department Dosso 960

V Other Production Development 2_0 1 220 21i20 _ _ Power 1,840 Industry 280 Tourism and hotels 2,030 2 Transportation 1,220

VI Investment in Social Sectors 72572 8,225 1,875 14,649 9.867 11,365 135140 Schools 1,790 500 124 3,100 1,900 6,300 4,600 Aid to education 77 558 525 470 465 165 Educational television 4,785 5,720 5,880 4,150 1,100 8,500 Vocational training and literacy programs 311 140 300 1,400 Training of administrative staff 436 436 308 116 Broadcasting equipment 700 2,730 700 Cultural research centers 340 487 560 Health 580 650 i,674 2,376 1,700 40

Total I - VI 33,853 31,554 20,824 30,168 17,902 28,435 25,089

Aid to the Budget and National Investment Fund 4£000 5,170 18,302 20,000 20,000 20 000 20,000

Total 37,853 36,724 39,126 50,168 37,902 48,435 45,089

Cumulative Total 37,853 74,577 113,703 163,871 201,773 250,208 295,297

/ Preliminary. 2/ Loan. 2/ Animation au ddveloppement. 4/ Including a loan of FF 1.5 million (working capital of SONERAN).

Note: This table does not show all French aid and not even all F.A.C. aid to Niger. Niger benefits in part from funds made available for projects of general interest, as in the case of aid to various inter-African organizations, The financing of temporary missions of experts falls directly under the Secretariat of State for Foreign Affairs and IV therefore not included in this table. The same applies to the cost of direct technical assistance personnel (around 500 persons, over half of whom are in education) amounting to about FF 25 million a year. Also not shown bere are certain external aid charges included in the budgets of other ministries (military aid; ASECNA; Treasury staff working in the Nigerien Trea- sury; French contribution to the current cost of African research institutes and universities). On the other hand, French budget aid (including F.N.I.) is fully taken into account here.

Source: Embassy of France in Niger, Permanent Aid and Cooperation Mission. Table 10.2: STATUS OF F.E.D. PROJECTS IN NIGER

(Cumulative amounts; thousands of accounting units)

1968 1969 1970 1971 1972 1973 Investment and connected technical assistance Commitments 44,515 51,825 52,325 81,713 83,296 88,392 Disbursements 27,839 31,480 35,469 40,449 48,838 59,793 Production aid Comni tments 4,869 4,868 4,447 4,447 4,554 4,554 Disbursements 2,151 2,374 3,147 1,992 2,290 2,649 Diversification aid Commitments 936 1,625 1,625 1,946 1,934 1,946 Disbursements 60 342 451 726 1,198 1,760 General technical assistance Commitments 280 280 280 818 883 2,175 Disbursements - 24 166 242 394 419 Emergency aid Commitments - - 225 225 225 225 Disbursements - - - 140 140 140 Total F.E.D. aid Commitments 50,600 58,598 58,902 89,149 90,892 97,292 Disbursements 30,050 34,220 39,233 43,549 52,860 64,761

(Annual disbursements) ( 5,064) ( 4,770) ( 5,013) ( 4,316) ( 9,311) (11,901)

Source: Semi-annual Statements of F.E.D. Projects. Table 10.3: SECTORAL DISTRIBUTION OF F.E.D. AID TO NIGER 1/

(Thousands of accounting units)

Cumulative Disbursements Original Dec. Dec. Dec. Dec. Dec. Dec. June Dec. Balance Balance Commitment 1967 1968 1969 1970 1971 1972 1973 1973 on 12/31/72 on 12/31/73 First F.E.D. Agriculture 7,677 7,619 7,752 7,752 7,752 7,752 7,677 T 7,677 T - - Industry 360 - - - - - 360 360 T - - E_o smic i .. fast_tr_2/5v,37 ... 963S417 S77 . o,799804 8,947 -10,099 1,u963 Social infrastructure 11,483 10,003 10,707 11,119 11,446 11,481 11,483 T 11,483 T - -

Total 30,483 22,659 25,336 27,288 27,997 28,180 29,619 30,483 864 - Second F.E.D. 3/ Agriculture 12,042 1,553 1,636 2,981 4,483 6,048 7,083 7,331 8,151 3,519 3,891 Industry 528 81 81 81 81 103 219 353 514 297 14 Economic infrastructure 2/ 6,898 183 487 812 1,855 4,133 5,772 6,844 6,878 1,126 -20 Social infrastructure 6,867 42 47 55 664 1,580 5,257 5,419 6,084 1,610 783 Other 4/ 2,102 18 312 605 840 1,026 1,026 1,026 1,026 1,076 1,076

Total 28,437 1,877 2,563 4,534 7,923 12,890 19,357 20,973 22,653 7,628 5,784 Third F.E.D. Agriculture 2,865 - - - 73 347 561 935 1,248 1,930 Industry 407 ------80 407 327 Economic infrastructure 2/ 25,455 - - - 32 656 768 5,933 24,799 19,522 Social infrastructure 4,570 - - - - - 57 772 1,257 2,614 3.313

Total 33,297 - - - 105 1,060 2,101 8,205 29,068 25,092

1/ Investment and connected technical assistance. 2/ Almost exclusively road projects. 3/ Includes 3 diversification aid projects and 1 production aid project. 4/ Essentially reserves and technical supervision.

Source: F.E.D., Semi-annual Statements of Projects. Table 10.4: GERMAN (FEDERAL REPUBLIC) CAPITAL AID TO NIGER

(Thousands of DM)

Cumulative Disbursements Date of Credit Credit Dec. Dec. Dec. Balance Type of Project Agreement Amount 1972 1973 1974 on 12/31/74

Water supply projects Dec. 01, 1965 10,000 ) 144 Increase of credit of 12/01/65 Apr. 03, 1968 3,000 ) 13,632 13,852 13,856 Rural water supply project Aug. 15, 1969 1,000 ) (Department Dosso) Livestock watering places in the Aug. 15, 1969 2,000 1,704 1,861 1,888 112 region of Agadez Water and power supply of Zinder Mar. 19, 1971 8,800 948 2,255 4,378 4,422 Sewerage project, Maradi Dec. 29, 1972 350 - 91 303 47 .(project preparation credit) Water supply of Niamey Sep. 18, 1973 14,300 - 853 13,447 Commodity aid (drought relief) Oct. 10, 1973 8,000 - 5,059 2,941

Credit to BDRN for the financing of industrial projects Dec. 06, 1966 2,000 1,966 1,966 1,966 34

Total commitments 49,450 18,250 20,025 28,303 21,147

Projects in preparation:

Sewerage project, Maradi (main credit) 10,650 Cattle fattening ranch, Tiaguirere 6,000 Irrigated truck farming in the Maggia valley 6,800 Commodity aid 8,000 Power transmission line Niamey - Tillabery 4,200

Total 35,650

Source: Data provided by the German authorities. Table 10.5: I.D.A. LENDING TO NIGER (Thousands of US dollars)

Original Exchange Cumulative Disbursements Credit Date of Credit Credit Adjust- Cancel- Dec. Dec. Dec. Dec. Dec. Dec. June Dec. June Dec. No. Type of Project ARreement Amount ment J lations 1967 1968 1969 1970 1971 1972 1973 1973 1974 1974

55 Road project June 24, 1964 1,500 309 1 468 1,101 1,499 1,499 1,499 1,628 1,808 1,808 1,808 1,808

128 Highway maintenance project Sep. 23, 1968 6,120 1,043 - - - 533 2,748 4,302 5,730 6,802 7,114 7,163 7,163

128 Highway maintenance project Nov. 26, 1973 350 ------105 248

207 Agricultural project June 29, 1970 584 20 _- - 57 126 158 304 304 324

231 2nd Highway construction project Jan. 29, 1971 5,700 338 - - 135 2,137 3,510 4,805 5,788 5,918

231 2nd Highway construction project Nov. 26, 1973 850 ------_ - 177

441 Drought relief project Dec. 07, 1973 2,000 ------200 218

473 Niamey international airport project May 24, 1974 5,000 ------

TOTAL 22,104 1,711 1 468 1,101 2,032 4,248 5,994 9,621 12,278 14,031 15,368 15,856

1/ Adjustment to reflect the devaluation of the US dollar on May 8, 1972, and February 13, 1973.

Source: I.D;A., Statements of Development Credits. Table 10.6: MIXED ENTERPRISES IN NIGER (Amounts in millions of CFAF)

Cumulative Date of Invest- Capital Turnover Net Result Deficit Name Abbreviation Establishment Purpose ment on 9/30/72 1970/7l 1971/72 1971/72 on 9/30/72 Societe Nigdrienne de Commercialisation SONARA 1962 Storage and marketing of groundnuts 304.00 300.00 7,344.80 7,297.66 +214.23 - de l'Arachide in Niger Socidte Nigdrienne de Commercialisation et COPRO-NIGER 1962 Reorganization and development of 135.00 de Production 300.00 3,950.70 4,932.24 + 97.32 - 58.58 commercial circuits, import-export trade Societe Nigerienne d'Electricite NIGELEC 1970 Production and distribution of 830.00 214.00 987.04 1,500.00 +100.00 - electricity Societe Nationale des Transports Nig6riens SNTN 1963 All kinds of road transport 647.00 186.00 948.10 1,110.53 + 60.16 Banque de Ddveloppement de la Republique BDRN 1961 All kinds of banking operations 460.00 1,000.00 du Niger 564.oo 683.35 + 82.26 Societd Nationale de Cimenterie SNC 1966 Production and sale of cement 1,677.00 900.00 343.59 Office National des Produits Pharmaceutiques 547.84 + 60.01 -488.96 ONPPC 1962 Wholesale of pharmaceutics, creation of 62.00 110.04 529.64 et Chimiques 545.44 + 50.82 - depots and pharmacies in Niger, production and conditioning of pharma- ceutical products Soci6te Nationale des Grands Travaux SNGTN 1962 Realization and promotion of all kinds 201.00 0.00 58.20 437.59 - 18.69 - 18.69 V du Niger of public works Societe Nigerienne de Fabrication de Meubles SONIFAME 1964 Production and sale of all kinds of 46.oo Mdtalliques 81.25 187.95 256.95 + 31.98 - furniture and office equipment Air Niger AIR NIGER 1966 Operation of air transport services 37.00 28.00 267.6s 241.85 - 0 - 0.36 within Niger Office des Produits Vivriers du Niger OPVN 1970 Marketing of Nigerien food products Socidte Nigdrienne 16.75 118.25 120.79 232.74 + 26.34 - d'Exploitation des SONERAN 1968 Utilization of animal resources, 185.00 270.44 151.24 147.96 + 11.34 - Ressources Animales operation of a ranch Societe Nigerienne d'Urbanisme et de SONUCI 1962 All kinds of real estate operations, 652.00 115.00 Construction Immobilibre 116.79 121.45 + 9.18 - 12.22 hire-purchase, sales, town planning, housing Credit du Niger CREDIT NIGER 1958 Personal equipment loans, credit for 120.00 220.00 95.06 106.00 + 2.19 residential construction, rental and hire-purchase operations Societd de Transformation du Mil et SOTRAMIL 1967 Processing of millet, sorghum and niebe 55.00 du Sorgho 84.01 153.50 105.69 + 2.00 - 45.70 (cowpeas), production of flour and cereals Riz du Niger RINI 1964 Processing, conditioning and marketing 112.00 77.00 147.75 96.13 + 7.23 of rice Socidtd Mini'ere du Niger SMDN 1961 Mineral research, mining, purchase and 58.00 24.00 53.08 70.90 + 5.16 - sale of minerals, particularly of gold and cassiterite Socidte Nigdrienne de Ceramiques SONICERAM 1966 Production of clay-based construction 90.00 62.00 44.40 54.06 + 10.42 - 47.48 materials and of ceramics Socidte Nigerienne des Primeurs SONIPRIN 1970 Marketing and production of early season 81.00 20.00 15.98 36.37 - 32.43 - 44.34 vegetables Socidtd Nationale des Transports Urbaina SNTU 1962 Operation of passenger transport services 28.00 5.00 27.47 33.11 + 1.75 - in the principal urban centers of Niger

i/ The previous deficit of CYAP 704.7 million was absorbed by the Government in 1971/72.

Source: Ministry of Economic Affairs, Commerce and Industry, General Secretariat of the Interministerial Committee in Charge of Mixed Enterprises, Annual Report FY 1971/72. Table 10.7: ESTIMATED CONTRIBUTION OF THE URANIUM SECTOR TO THE BALANCE OF PAYMENTS (Quantities in metric tons, values in millions of CFAF)

Export Export Value Imports of Balance A I/ Imports of Balance B J Year Volume Low Price High Price Production Inputs Low Price High Price Equipment Low Price High Price

1972 456 2,381 2,298 83

1973 1,090 5,020 3,030 1,990 1,000 990 1974 1,250 6,000 3,820 2,180 2,000 180 1975 1,380 6,900 10,350 5,250 1,650 5,100 3,000 -1,350 2,100 1976 1,500 7,500 11,250 6,510 990 4,740 6,000 -5,010 -1,260 1977 1,500 7,500 11,250 7,005 495 4,245 9,000 -8,505 -4,755 1978 1,700 8,500 12,750 8,535 -35 4,215 3,000 -3,035 1,215 1979 3,250 16,250 24,375 17,515 -1,265 6,860 3,000 -4,265 3,86o

1980 4,000 20,000 30,000 23,200 -3,200 6,800 6,000 -9,200 800 1981 4,000 20,000 30,000 24,560 -4,560 5,440 8,000 -12,560 -2,560 1982 4,500 22,500 33,750 29,295 -6,795 4,455 2,000 -8,795 2,455 1983 5,000 25,000 37,500 34,500 -9,500 3,000 -9,500 3,000 1984 5,500 27,500 41,250 40,260 -12,760 990 -12,760 990 1985 4,742 23,710 35,565 36,798 -13,088 -1,233 -13,088 -1,233 1986 4,500 22,500 33,750 36,990 -14,490 -3,240 -14,490 -3,240

Cumulative Totals: 1973-1979 6,005 29,330 -20,995 2,330 1980-1986 -64,393 16,212 -78,393 2,212

S/ Net export proceeds = gross export value less imports of production inputs. S/ Net effect on the overall balance.