Public Disclosure Authorized

Document of
The World Bank

Report No. 115661-NE

Public Disclosure Authorized

REPUBLIC OF NIGER

PRIORITIES FOR ENDING POVERTY AND BOOSTING

SHARED PROSPERITY

SYSTEMATIC COUNTRY DIAGNOSTIC

Public Disclosure Authorized

November 28, 2017

International Development Association

Public Disclosure Authorized

Country Department AFCW3

Africa Region

International Finance Corporation

Sub-Saharan Africa Department

Multilateral Investment Guarantee Agency

Sub-Saharan Africa Department
 REPUBLIC OF NIGER - GOVERNMENT FISCAL YEAR
January 1–December 31

CURRENCY EQUIVALENTS
(Exchange Rate Effective as of October 2017)

Currency Unit = CFA Franc (CFAF)

US$1.00 = CFAF 556

ABBREVIATIONS AND ACRONYMS

3N Nigériens Nourrissent les Nigériens, Nigeriens feed Nigeriens

ARMP Agence de Régulation des Marchés Publics, Public Procurement Agency
ARSM L'Agence de Régulation du Secteur de la Microfinance, The Microfinance
Sector Regulatory Agency
BAGRI Banque Agricole du Niger, Agricultural Bank of Niger
BCEAO La Banque Centrale des Etats de l'Afrique de l'Ouest, Central Bank of the
States of West Africa
BCG Bacillus Calmette-Guérin
BRACED Building Resilience and Adaptation to Climate Extremes and Disasters
CAFER Caisse Autonome de Financement de l'Entretien Routier, Road Maintenance
Fund of Niger
CAIMA La Centrale d'Approvisionnement en Intrants et Matériels Agricoles, Central
Supply of Inputs and Agricultural Materials
CDV Contract Development and Verification
CFAF Franc de Communauté Financière Africaine, Franc of the African Financial
Community
CGE Computable General Equilibrium
CNECDD Comité National Consultatif pour l'Environnement et le Développement
Durable, National Advisory Committee on Environment and Sustainable
Development
CNPC China National Petroleum Corporation
COFO Commission foncière, Land Commission
CPIA Country Policy and Institutional Assessment
DGTPC Direction générale du trésor et de la comptabilité publique, General
Directorate of the Treasury and Public Accounting
DHS Demographic and Health Survey
DPT Diphtheria, Pertussis, and Tetanus
ECOWAS Economic Community of West African States
EDSN-MICS Enquête. Démographique et de Santé et à Indicateurs. Multiples du Niger,
Niger’s Demographic and Health Survey with Multiple Indicators
EITI Extractive Industries Transparency Initiative
EIU Economist Intelligence Unit
ENBC Enquête Nationale sur le Budget et la Consommation des Ménages, National
Household Budget and Consumption Survey

i
ENISED Etude Nationale d’Evaluation d’Indicateurs Socio-Economiques et
Démographiques, National Survey of Socioeconomic and Demographic
Indicators
FIMA Festival international de la mode africaine, African Fashion International
Festival
FINDEX Financial Inclusion Index
GDP Gross Domestic Product
HH Household
HIPC Heavily Indebted Poor Countries
IBRD International Bank for Reconstruction and Development
ICARDA International Center for Agricultural Research in the Dry Areas
ICT Information and Communication Technology
IDA International Development Association
ID4D Identification for Development Initiative
IFC International Finance Corporation
IIED International Institute for Environment and Development
IMF International Monetary Fund
INS Institut National de la Statistique, National Statistical Institute
IRIN Integrated Regional Information Networks
ISFM Integrated Soil Fertility Management
ITU International Telecommunication Union
LASDEL Laboratoire D'études Et Recherches Sur Les Dynamiques Sociales Et Le
Développement Local, Laboratory of Studies and Research on Social
Dynamics and Local Development
LINKAGE World Bank’s Global Dynamic CGE Model
LSMS-ISA Living Standards Measurement Study - Integrated Surveys on Agriculture
LUCC Land-Use and Land-Cover Change
MCC Millennium Challenge Corporation
MDRI Multilateral Debt Relief Initiative
MICS Multiple Indicator Cluster Survey
MINUSMA United Nations Multidimensional Integrated Stabilization Mission in Mali
MOH Ministry of Health
NIGELEC Société Nigerienne d'Electricité, Electricity Company of Niger
NGO Nongovernmental Organization
OLS Ordinary Least Quares
ONAHA Office National des Aménagements Hydro agricoles, National Hydro
Agricultural Development Office
OPVN Office des produits vivriers, Office of Food Products
PASEC Programme d’Analyse des Systèmes Educatifs de la CONFEMEN, Program
Analysis of the CONFEMEN Education Systems
PDES Plan de Développement Economique and Social, Economic and Social
Development Plan
PEFA Public Expenditure and Financial Accountability
PER Public Expenditure Review
PBF Performance Based Financing
PFM Public Financial Management

ii
PIMA Public Investment Management Assessment
PPP Purchasing Power Parity
PNDS Parti Nigerien pour la Democratie et le Socialisme, Nigerien Party for
Democracy and Socialism
QUIBB Questionnaire Unifié des Indicateurs de Base de Bien-être, Unified
Questionnaire of Basic Indicators of Well-being
RESEN Rapport d’Etat du Système Educatif Nigérien, State Report of the Nigerian
Educational System
SAM Social Accounting Matrix
SCD Systematic Country Diagnostic
SDDEL Stratégie de Développement Durable de l’Elevage, Sustainable Livestock
Development Strategy
SDI Service Delivery Indicator
SPCR Strategic Program for Climate Resilience Niger
SSA Sub-Saharan Africa
TFP Total Factor Productivity
TOR Terms of Reference
TVA La taxe sur la valeur ajoutée, Value Added Tax
UNDP United Nations Development Programme
USAID U. S. Agency for International Development
UNEP United Nations Environment Programme
UNFPA United Nations Population Fund
UNESCO United Nations Educational Scientific and Cultural Organization
UNISDR United Nations Office for Disaster Risk Reduction
UNHCR United Nations High Commissioner for Refugees
WAEMU West African Economic and Monetary Union
WDI World Development Indicators
WFP World Food Programme
WHO World Health Organization
WRI World Resource Institute

IDA IFC MIGA

Vice President: Makhtar Diop Dimitris Tsisiragos Keiko Honda
Director: Soukeyna Kane Vera Songwe Merli Baroudi
Manager: Andrew Dabalen Ronke-Amoni Ogunsilire Dan Biller
Task Team Leaders: Johannes Hoogeveen; Frank Douamba Conor Healy
Aly Sanoh; Luc
Razafimandimby

iii
TABLE OF CONTENTS

FOREWORD .............................................................................................................................................vii
EXECUTIVE SUMMARY ........................................................................................................................ix
1. Introduction.......................................................................................................................................... 1
2. Poverty, Risks and Vulnerability ....................................................................................................... 8
2.1 Poverty and Poverty Trends ........................................................................................................... 8
2.2 Poverty Profile ............................................................................................................................. 12
2.3 Risks and Vulnerability ...............................................................................................................13
2.4 Poverty Traps ...............................................................................................................................15
2.5 Climate Change ...........................................................................................................................19
3. Human Capital ................................................................................................................................... 23
3.1 Introduction..................................................................................................................................23
3.2 Health ...........................................................................................................................................25
3.3 Education .....................................................................................................................................30
4. Economy and Opportunities for Growth ........................................................................................ 36
4.1 Introduction..................................................................................................................................36
4.2 Sources of Growth .......................................................................................................................38
4.3 Behind the Headline Numbers .....................................................................................................42
4.4 Policy Simulations .......................................................................................................................47
5. Governance ......................................................................................................................................... 50
5.1 Introduction..................................................................................................................................50
5.2 Niger’s Political Settlement .........................................................................................................52
5.3 Consequences of the Political Settlement ....................................................................................56
5.4 The Challenge of Reform ............................................................................................................59
6. Identifying and Prioritizing Pathways to Poverty Reduction ........................................................ 62
6.1 The Challenge of Reducing Poverty in Niger ..............................................................................62
6.2 Reducing Poverty by Increasing Productivity of Agriculture .....................................................66
6.3 Complementary Pathways to Reducing Poverty .........................................................................71
6.4 Binding Constraints .....................................................................................................................72
6.5 Additional Research Suggested ...................................................................................................90
Annex 1: OLS Regression of Log per Capita Consumption .................................................................. 96
Annex 2: Additional CGE simulations .................................................................................................... 97
Annex 3: SCD Consultations .................................................................................................................... 99

iv
LIST OF FIGURES

Figure E.1: Demographic challenges ........................................................................................... xxi

Figure E.2: Poverty and the potential to increase agricultural productivity through irrigation .... xx
Figure 1.1: Challenges faced by Niger ........................................................................................... 2
Figure 1.2: Structural challenges to economic development .......................................................... 4
Figure 1.3: Economic opportunities5Figure 2.1: Poverty incidence and number of poor
....................................................................................................................................................................... 8
Figure 2.2: Growth incidence curves and elasticity ....................................................................................... 9
Figure 2.3: Poverty decomposition ................................................................................................................ 9
Figure 2.4: Population growth rate and poverty incidence by region .......................................................... 10
Figure 2.5: Poverty and agro-ecological zones ............................................................................................ 11
Figure 2.6: Sources of food consumed and sources of cash income agro-ecological zones ....................... 12
Figure 2.7: Inequality in land and livestock ownership ............................................................................... 13
Figure 2.8: Vulnerability and poverty ......................................................................................................... 14
Figure 2.9: Perceptions of poverty and its causes ........................................................................................ 15
Figure 2.10: Agricultural inputs and yields ................................................................................................. 16
Figure 2.11: Education ................................................................................................................................. 17
Figure 2.12: Differences in main activities between men and women ........................................................ 18
Figure 2.13: Perceptions of climate change, cereal, and livestock production ............................................ 20

Figure 3.1: Niger does not yet realize its migration potential....................................................... 23
Figure 3.2: Progress in human capital outcomes .......................................................................... 24
Figure 3.3: Fertility rates and child survival ................................................................................. 26
Figure 3.4: Niger’s health indicators in relation to comparator countries .................................... 29
Figure 3.5: Levels of education for adults (2012) and access to mass media ............................... 30
Figure 3.6: Education attendance and main activities in rural and urban areas ............................ 31
Figure 3.7: Education enrollment and quality............................................................................... 32
Figure 3.8: Regional inequalities in education ............................................................................. 33
Figure 3.9: Difference in per capita consumption relative to households with heads who have no
education (only significant results are presented) ......................................................................... 35
Figure 4.1: GDP growth and rainfall ............................................................................................ 36
Figure 4.2: GDP, growth, and the external sector......................................................................... 41
Figure 4.3: The business environment .......................................................................................... 43
Figure 4.4: Access to finance (2014) ............................................................................................ 46
Figure 5.1: Public Financial Management .................................................................................... 50
Figure 5.2: Governance indicators: 1996–2014 ............................................................................ 52
Figure 5.3: Empowerment and service delivery ........................................................................... 57
Figure 5.4: Challenges with service delivery in health facilities .................................................. 58
Figure 6.1: Past per capita consumption growth (2005–2014) and simulations of the change in
US$1.9 PPP poverty under different future growth scenarios (2015–2030) ................................ 62
Figure 6.2: Analytical framework for poverty reduction .............................................................. 64
Figure 6.3: Yield gap and input use .............................................................................................. 66
Figure 6.4: Economic opportunities associated with migration.................................................... 71
Figure 6.5: Five-step process to identify and prioritize binding constraints................................. 73
Figure 6.6: Productivity interventions can be spatially focused ................................................... 79

v
LIST OF TABLES

Table 3.1: Summary of indicators on health and education in Niger ........................................... 27

Table 4.1: Structure of the Niger Economy: 2007-2016............................................................... 40
Table 4.2: Selected Economic and Financial Indicators, 2014–2021 ........................................... 49
Table 5.1: High tax rates create incentives for tax evasion and informality................................. 56
Table 6.1: Illustrating the structural transformation challenge and job characteristics ................ 65
Table 6.2: Addressing the rural productivity constraint in a sustainable manner ......................... 80
Table 6.3: Addressing the human capital constraint with particular attention to women............. 83
Table 6.4: Governance constraints to inclusive growth and service delivery ............................... 87

LIST OF BOXES

Box 1.1: Informal trade in scarcely populated areas presents a governance risk ........................... 6
Box 2.2: Determinants of poverty decline .................................................................................... 21
Box 4.1: Niger’s economic symbiosis with Nigeria and consequences of the naira devaluation 37
Box 5.1: The role of the army ....................................................................................................... 54
Box 5.2: Religious radicalization .................................................................................................. 55
Box 5.3: Governance and the quality of statistics......................................................................... 58
Box 6.1: Climate-smart agriculture practices can foster productivity in agriculture .................... 69
Box 6.2: A citizen-centered approach requires local knowledge ................................................. 78
Box 6.3: Not all interventions are equally politically attractive ................................................... 94

vi
FOREWORD
This document presents the Systematic Country Diagnostic (SCD) for Niger. It identifies, in
an empirically supported manner, the core constraints to rapidly reducing poverty and improving
shared prosperity by 2030.

The team has tried to be selective in the identification of binding constraints. Public resources
(financial means but also capacity) are not available in unlimited quantities and need to be used
selectively. Selectivity means the identification of principal opportunities for poverty reduction in
the next 15 years, as well as the identification of binding constraints to seizing such opportunities.
In the search for selectivity, there is always the risk of not identifying the correct set of constraints.
However, the risk of not being selective would probably have more serious implications as it could
lead the Government and its development partners to disperse their resources and attention too
thinly over too many priorities.

Selectivity implies making trade-offs between immediate and longer-term objectives. In this
SCD, priority is given to poverty reduction opportunities which could deliver results before 2030.
Given the challenges Niger faces, it would be optimistic to assume that poverty will be eliminated
by 2030. Reducing poverty to 3 percent will probably require a longer time perspective with
concomitant consequences for the selection of priorities, which need to include creating a solid
basis for future poverty reduction. As a consequence, investments in very young children, which
take more than 15 years to yield a return in terms of raised incomes were still considered; the same
holds for investments in urban development, mining, transport corridors, and large-scale power
generation, activities with limited direct impact on the poor but critical to gross domestic product
(GDP) growth and economic transformation.

This SCD presents binding constraints that can feasibly be addressed. Niger has a complex
political economy characterized by low capacity, ineffective institutions, limited resources, and a
political settlement that relies, for its survival, heavily on the distribution of privileges and co-
optation of opposition members. While this has created stability and security (though the latter is
increasingly under threat)—critical prerequisites for development—it has not provided a very
conducive environment for poverty reduction. The SCD takes this political reality into account
and argues, among others, for the creation of centers of excellence in the central administration
and a citizen-centered approach to development activities empowering citizens with information,
education, purchasing power (transfers, vouchers), and choice in service providers.

The SCD has given preference to actions that can set in motion positive feedback loops or
that can address multiple poverty traps at the same time. Investments in irrigation increase the
time in which land and labor can be used productively and reduces dependence on the vagaries of
the weather, thus addressing poverty rates associated with a lack of assets, weather risks, and
declining soil fertility. A decline in fertility would catalyze a change in age structure resulting in
lower dependency ratios, which enables higher investments in health and human capital, leading
to higher economic growth and poverty reduction and more resources for future investments in
poverty reduction.

The SCD was prepared by a team led by Johannes Hoogeveen (Lead Economist), Aly Sanoh
(Economist) of the Poverty and Equity Global Practice, and Luc Razafimandimby (Senior

vii
Economist, Macro and Fiscal Management) in close collaboration with the Program Leaders for
Niger, Jose Lopez-Calix, Pierre Kamano, Christophe Lemiere, and Michel Rogy as well as with
Siaka Bakayoko (Country Manager), Paul Noumba Um and Soukeyna Kane (Country Directors),
and Paola Ridolfi (Country Program Coordinator). Other members of the team included Dahlia
Lotayef and Bougadare Kone (Environment); Inoussa Ouedraogo; Aimilios Chatzinikolaou,
Kirstin Roster, Sizwe Mdluli, and Olivier Nour (IFC); Conor Healy (MIGA); Michel Mallberg
(Governance); Dinar Dhamma Prihardini and Abdoulahi Garba (Macro and Fiscal); Jean-
Christophe Maur, Mahaman Sani, and Magueye Dia (Trade and Competitiveness); Brigitte
Bocoum and Mamadou Barry (Mining); Fatou Fadika and Marilyne Goncalves (Financial
Markets); Jean Baptiste Migraine and Sylvie Debomy (Urban); Daniel Kirkwood (Gender); Emilie
Jourdan (Fragility); Kirsten Majgaard and Adama Ouedraogo (Education); Djibrilla Karamoko
and Rifat Hasan (Health); Carlo del Ninno and Mahamane Amadou (Social Protection); Manuel
Luengo, Charles Joseph Cormier, David Vilar, and Sameer Shukla (Energy); Amadou Ba, Vikas
Choudhary, Joanne Gaskell, Yeyande Sangho, Christian Berger and Friederike Mikulcak
(Agriculture); Andreas Schliessler and Aguiratou Savadogo-Tinto (Transport); Pierrick Fraval and
Aude-Sophie Rodella (Water); Thea Hilhorst and Caroline Plançon (Land); Cheikh Sagna (Social
Development); Gina Kosmidou (Consultant) and Fatimata Sy, Salimata Dera, Senait Yifru,
Hamsatou Barke, Siele Ketema, and Martin Buchara (Program Assistants). The final document
was peer reviewed by Gael Raballand (Senior Public Sector Specialist) and Pierella Paci (Lead
Economist) and benefited from guidance from Pablo Fajnzylber and Andrew Dabalen (Managers
Africa Poverty and Equity Global Practice), Lars Moller (Manager Macro and Fiscal Management)
and the Systematic Country Diagnostic (SCD) advisory group.

The preparation of the SCD benefited from excellent collaboration with the Government of Niger.
Consultations were held in May and September 2016.

viii
EXECUTIVE SUMMARY

1. This document presents the Systematic Country Diagnostic (SCD) for Niger. It
identifies the constraints and opportunities for achieving the twin goals of ending poverty and
improving shared prosperity by 2030 in a sustainable manner while acknowledging (a) the need
for selectivity and (b) the need to identify constraints that can feasibly be addressed. The objectives
of the World Bank are closely associated with those of the Government of Niger, which aims in
its Renaissance Program, to achieve rapid poverty reduction by 2035.

2. Located in the Sahel, landlocked Niger (the closest port, Cotonou, is over 1,000 km
away) finds itself at the heart of a turbulent region marked by political and religious violence
in northern Nigeria, separatist and armed movements in northern Mali, and intercommunal
violence and state collapse in southern Libya. It has affected Niger in important ways, including a
state of emergency in the southeastern region of Diffa and an estimated 198,000 refugees and
137,000 internally displaced persons. With a population of 19.9 million in 2015 (World
Development Indicators) and a land area of 1.27 million km2, Niger is sparsely populated on
average. However, most people live in the south of the country (about 12 percent of the land area)
where most arable land is located. Niger’s significant mineral wealth deposits of uranium, gold,
coal, and petroleum generate up to a quarter of all Government revenue and 10 percent of GDP.

3. With a per capita gross domestic product (GDP) of US$895 in 2015 (constant 2011
U.S. dollar), Niger is among the poorest nations in the world. The vast majority of Niger’s 8.2
million poor (2014 estimate) live in rural areas where food insecurity is high. Human development
indicators are low. The average level of education is 1.4 years; only 52 percent of children have
received a complete set of vaccinations and 44 percent of children under five years are stunted.

4. The economy is undiversified with few indications of structural transformation.

Agriculture is the dominant sector in the economy (40 percent of GDP) and sectors such as
manufacturing (6 percent of GDP), construction and public works (3 percent of GDP), and
production of electricity gas and water (1 percent of GDP) are relatively small and underdeveloped.
More than 60 percent of GDP is generated in the informal sector. The share of the secondary sector
in GDP did increase over the past 15 years, however, not because of growth in industrial production
but due to the expansion of the extractives industry. The tertiary sector generates around 40 percent
of GDP. The relatively high contribution of the tertiary sector is not so much the result of the
development of a more modern section of the economy as the reflection of the importance of
import and export trade and the cost of transportation. Commerce and transport and the public
sector represent the most important activities in the tertiary sector with shares of 12 percent of
GDP respectively.

5. The majority of the population generates its income from (rain-fed) agriculture and
livestock rearing. The Sahara Desert aside, people live in four agro-ecological zones. The first
zone is the pastoral zone with rainfall of 100–300 mm per year and a sub-desert climate. It is home,
primarily, to transhumant cattle herders. The second is an agro-pastoral zone which receives 300–
500 mm of rain per year and is suitable for extensive farming (of millet mostly). Most households
in this zone do not produce enough food to feed themselves and engage in goat rearing, casual
labor, small trade, and seasonal migration to make ends meet. The third zone (the south-Maradi,

ix
south Zinder and Dosso regions) is characterized by 500-600 mm of rainfall per year and by semi-
intensive, rain-fed agricultural practices and livestock rearing. Finally, irrigated cash crops are
grown in selected areas along the Niger River. Together, the agriculture and livestock sectors
engage more than 80 percent of the workforce and account for 40 percent of GDP. Niger’s
subsistence agriculture is based on cereal crops (millet and sorghum) as well as cow peas, crops
that also constitute the staple diet.

6. Despite opting for drought-resistant crops and transhumant herding practices,

Niger’s rural population is vulnerable to climatic hazards. Inadequate yields, poor
diversification of incomes, climate change, and increasing pressure on land due to population
growth are the reasons why economic and food insecurity persist and why levels of malnutrition
are high. Niger is a net importer of food (food is the second most important import good after
capital goods). Nigeriens regularly undertake seasonal migration to reduce the pressure for food at
home (one less mouth to feed) and to earn some income during the off-season.

7. Rapid population growth presents a major challenge. Population growth has reached
3.9 percent per year on account of a high desire for children (7.3 children per women in 2015) and
a rapid decline in child mortality. High fertility is associated with large families, high dependency
ratios, and low levels of education, factors that are all positively associated with poverty. High
dependency ratios reduce the ability to save and invest in human and physical capital, thus
perpetuating poverty as families opt to rely more on labor and invest less in the education and
health of their children. High fertility has negative consequences for women’s health and their
nutritional status, as well as that of their offspring. It increases pressures on limited resources
(water, fertile land, and forests) and because the population is relatively young, the state is
burdened with much higher demands for investments in education and health services than would
be the case in a situation of lower population growth.

8. High levels of fertility in Niger is unique in that the desire for an additional child
barely declines with the number of children. High wanted fertility may appear exceptional but
established correlates of fertility decline have been found to be valid for Niger as well. Women in
the highest wealth quintile, for instance, tend to have fewer children. Niger’s exceptionally high
fertility can be explained by low levels of income, little education, and limited access to
information and health services. There are also cultural aspects that explain a preference for
children. Some of these may be associated with religious interpretations, income risks in the face
of poverty, and gender discrimination. Without improvements in these general conditions (risk,
human capital, access to health services) and without an active (media) engagement to discuss and
challenge established norms, population growth is likely to remain high. The consequences of this
may be dire because—depending on the scenario—the population of Niger is projected to increase
to about 30–35 million by 2030 and between 67 and 78 million by 2050 (see Figure E.2).

9. A short rainy season and exposure to uninsured risk presents an enormous burden to
the economy. Niger’s economy depends largely on rain-fed agriculture, natural resource exports,
and aid. It creates high levels of underemployment, particularly outside the rainy season, and
makes the economy vulnerable to weather and price shocks and changes in donor sentiment. It
leads to cycles of booms and busts and—in an environment where monetary policy is determined
at the regional level (Niger is part of the CFA zone)—limited options for fiscal stabilization other

x
than by revising the public investment budget. At the household level it leads to risk aversion, slow
adoption of new (farming) techniques, huge investments in low-return savings (livestock),1 and,
at times harmful, informal insurance mechanisms such as pressing girls into early marriage (the
median age of first marriage for girls is 15 years!).

10. Poverty did decline over the past decade, but benefits from growth were largely
captured by better-off households. Poverty declined in all regions. The reduction was more
substantive in the capital city and in other urban areas where it declined from 29.6 in 2005 to 8.7
in 2014. In rural areas poverty declined from 58.3 percent to 51.4 percent. Inequality increased
during the same period as consumption growth was much higher among better-off households than
it was among the poorest. The reduction in poverty was driven by GDP growth that was made
possible by favorable exogenous circumstances. Comparatively favorable rainfall in 2014 relative
to 2005 explains much of the poverty reduction in rural areas as does the fact that between 2005
and 2014, weather variability was limited and major weather shocks absent. Poverty reduction in
urban areas came on the back of the natural resources boom. Uranium prices were favorable and
the production of oil came onstream. This boosted the Government’s budget and its ability to make
public investments (15 percent of GDP in 2016)—including major infrastructural investments in
the capital city, which in turn helped reduce poverty.

11. Multiple poverty traps make poverty reduction a challenge. The most destitute farmers
possess too few assets (land and animal traction) or are too much in debt to earn incomes that bring
them above the survival threshold where they can save and invest themselves out of poverty.
Instead they are often obliged to work on other people’s land to repay outstanding debts and unable
to bring sufficient land under cultivation to feed themselves through own-account farming. It
explains the noteworthy observation that only the less poor farmers are able to feed themselves
from own production, while the poorest are net buyers of food and dependent on income from
casual labor and gifts to make ends meet. There are numerous other traps related to ill-health, low
soil fertility, conflict, or cultural and gender practises. These impoverishing factors lead to low
incomes which in turn prevent these factors from being addressed, thus leading to self-perpetuating
cycles of poverty. Evidence of the prevalence of poverty traps can be inferred from references to
increasing landlessness, the formation of a class of medium-scale farmers who purchase land from
distressed peasants and the prevalence of acute malnutrition (a sign of food shortages) among the
poorest—even during non-drought years.

12. While multiple poverty traps have to be addressed simultaneously to lift households
out of poverty, certain measures address more than one trap. Irrigation offers much promise.
By lengthening the growing season, increasing yields per acre and by reducing exposure to weather
risk, irrigation addresses multiple poverty traps associated with low labor productivity, poor
nutrition, inadequate assets, and weather risk. By increasing incomes through irrigation—in
combination with activities that induce behavioural change (adult literacy training, access to
information, village health workers, extension)—one can also expect to have positive spillover

1
The value locked up in livestock savings is enormous. The INS (2015: Tableau de Bord) estimates that in 2013
there were 14.3 million goats, 10.7 million sheep, and 10.1 million cattle. Conservatively valued at US$70, US$70,
and US$250, respectively, the value these animals represent is the equivalent of 60 percent of GDP.

xi
effects on fertility, hygiene, nutrition, and resilience to climate change through the adoption of
adapted farming techniques.

13. Options for industrialization are limited by the size of the domestic economy, an
adverse business environment, and low levels of embedded technological knowledge.
Agriculture is expected to remain the dominant sector in the economy even though the share of the
secondary sector in GDP is on the rise. The scope for rapid industrialization through import-
substitution is limited by the small size of the domestic market, which reduces the scope for
specialization. The scope for industrialization through an export-led growth strategy is reduced by
high transaction costs as a result of an adverse business environment and the lack of productive
knowledge that is embedded in the economy. The latter can be inferred from the products which
are presently exported: unsophisticated products (minerals mostly) that are unconnected to other
products in the global product space.2 This leaves open the option of industrialization through the
transformation of agricultural produce; yet, to do this successfully, the cost of doing business will
need to decline.

14. High costs of doing business obstruct Niger’s development prospects. Being
landlocked and far from the nearest seaport, combined with low levels of human capital, present
formidable obstacles to developing a vibrant private sector. These disadvantages are made worse
by elevated costs of doing business. Transport costs are unnecessarily high because roads are not
maintained, roadblocks are common, and competition in the trucking sector is limited. Electricity
is costly and unreliable. Cross-border trade is expensive and inefficient due to the difficulty of
obtaining import and export licenses. Meanwhile, high import tariffs and levels of taxation drive
many toward informal trade. Telecom services are costly and grossly inadequate, as are banking
services. The regulatory burden is high, the tax system is complex, and the judicial system is
biased. Except for a few firms that exploit natural resources in enclave activities and some large
firms run by well-connected entrepreneurs, it makes for an unattractive investment climate for
domestic as well as foreign entrepreneurs and a very large informal sector.

15. Managing regional relations is an integral part of economic policy making in Niger.
Being landlocked and located in a turbulent region makes good relations with its neighbors critical
for Niger’s development prospects. There are many elements to this: Niger’s exports are largely
dependent on the efficiency of the transport system in neighboring countries with access to the sea,
while much of Niger’s informal trade in fuel and foodstuffs depends on the economic policies of
its neighbors, Algeria and Nigeria in particular. Most of Niger’s electricity comes from Nigeria
while most of Niger’s livestock are exported to Nigeria. This trade, as well as much of Niger’s re-
exports to Nigeria and remittances from Nigeria have been seriously affected by the devaluation
of the naira and by the ban on import of certain products (rice, meat), demonstrating on the one
hand the symbiosis between the two economies and on the other the difficulty of being part of a
currency zone (the West African Economic and Monetary Union [WAEMU]) of which the main

2
See Hausmann and Klinger (2006). Structural Transformation and Patterns of Comparative Advantage in the
Product Space downloadable from http://ksgnotes1.harvard.edu/Research/wpaper.nsf/rwp/RWP06-041 and Hidalgo
et al. (2007) The Product Space Conditions the Development of Nations. Science 317, 482 (2007); DOI:
10.1126/science.1144581.

xii
trading partner is not a member. Being downstream of the Niger River implies dependence on Mali
and Guinea for the quantity of water that arrives and its quality.

16. Rural-urban migration is potentially an important driver of growth and poverty

reduction. Labor shifting from the relatively unproductive agricultural sector, with high levels of
seasonal underemployment, to urban areas where one can be productive year-round is a potential
source of growth. Moreover, increased urbanization is known to accelerate growth because of the
scope for specialization and have positive spillover effects for rural growth by increasing demand
for agricultural produce and by providing cash and knowledge for productive investments in rural
areas. To date, this has not happened. Niger remains barely urbanized and as late as 2014 more
than 90 percent of the rural population lived in the same village where they were born. Reductions
in poverty have been driven by internal dynamics in urban or rural areas. Between 2005 and 2011,
and of the total 5.5 percentage point decline in poverty, only 0.14 percentage point was due to
rural-urban migration.

17. Niger’s development challenge can be illustrated by comparing the characteristics of

jobs of the self-employed in agriculture (81 percent of all jobs) with those in paid jobs in the
formal sector (4 percent of all jobs). Jobs in agriculture tend to be ‘bad’ jobs: returns are low,
rarely are they permanent, underemployment is high as is the fraction of people with a secondary
job. The reverse holds for the wage employed. Though they are few in number, their jobs are of
much better quality, being mostly permanent, with limited underemployment and often being
formal. People engaged in wage employment are also much more likely to receive health benefits.
Therefore, to reduce poverty it would be desirable if many more people became engaged in wage
employment. At the same time, it is unlikely that a sector that presently employs some 4 percent
of the population will be able to absorb the 81 percent that are currently primarily engaged in
agriculture.

18. Productivity needs to increase and the process of growth needs to become more
inclusive. A growth accounting exercise demonstrates that increases in labor account for most of
the growth in Niger, followed by increases in the capital stock. This is in line with the country’s
high population growth and, more recently, increases in public and private investments. There is,
however, little embedded technical change in these investments and total factor productivity (TFP)
is still catching up from a large decline in 1980. Other components, particularly changes in human
capital, play a much smaller role in explaining growth. The latter is unsurprising given the low
quality of education. To increase productivity, and hence household incomes, investments in
human capital will be needed to improve the quality of this key factor of production. The business
environment will need to improve to increase the rate of return to investments. This alone will not
be sufficient. The growth process also needs to become more pro-poor. Between 2005 and 2014
per capita consumption growth rate was 0.4 percent for those in the bottom 40 percent; much less
than the growth rate attained by those in the top sixty percent (2.7 percent). Investments in
infrastructure and the natural resources sector (the drivers of the investment boom) alone are
insufficient to generate an inclusive growth process.

19. The most promising approach to inclusive growth is by increasing productivity in the
short run and engaging in a process of classical structural transformation. One clear message
from the consultations held in September 2016 was that improvements in the business environment

xiii
for formal and informal enterprises and the way in which the public sector is managed could
immediately unlock much economic potential by stimulating private sector activity or by
increasing the efficiency of public investments and service provision. In the longer run, a process
of classical structural transformation could accelerate poverty reduction. This process starts by
increasing the productivity of agriculture (food stapes in particular) and livestock rearing.
Increases in agricultural production help suppress (fluctuations in) food prices, which is good for
the poorest who tend to be net buyers of food. Once the share of food consumers relative to food
producers grows (because of rural-urban migration), markets become more important, the nonfarm
and agribusiness sectors grow, and the food value chain and rural-urban linkages are strengthened.
As rural incomes grow, second-order effects are likely to emerge: the stock of human and physical
capital increases as households invest part of their increased incomes in their offspring. This leads
to further productivity gains and to out-migration of (now better-) educated people. It also unlocks
demographic transition, in part because higher incomes and higher levels of education induce
women to marry later, while increased irrigation and mechanization reduce exposure to weather
shocks and reliance on family labor.

20. Niger has a complex political settlement with multiple actors balancing each other’s
interests (and power) in a dynamic but relative stable equilibrium. The ruling coalition
changes regularly, co-opting new power brokers and sidelining others leading to high levels of
turnover in the administration. Since gaining independence in 1960, Niger has had no less than
seven republican regimes and four military coups. Among the core power players are the military;
a group of lifetime politicians; powerful traders; and selected traditional leaders, sheikhs, and
religious leaders. This ‘political class’ is sustained by a very poor, uneducated, and uninformed
population who seek protection against poverty and shocks. As a consequence of the dynamic
nature of the political settlement, politics is at times turbulent but rarely violent.

21. The political settlement casts a shadow over Niger’s development prospects. Not only
are incentives in the public sector not aligned with poverty reduction, the scope for change is
limited. Rent seeking, clientelism, and impunity are endemic as the competitive political settlement
and personalized bargaining among elites uses payoffs as means for co-optation. It ensures a
certain stability but also leads to a non-inclusive development model that is non-idealogical and
geared towards generating benefits to insiders. It explains a preference for capital-intensive
investments by the public sector such as in main roads, dams, large irrigation schemes and oil-
refineries as opposed to investments in agricultural extension, small scale irrigation or rural
electricifation. It explains the large informal sector as the economy is dominated by a small number
of public and private monopolies who prefer to restrict competition in their respective domains. It
gives rise to an adverse business environment with high transaction costs which can be avoided by
remaining informal, or by becoming large and well-connected. It also leads to an inefficient
administration with many ministries and with burdensome procurement procedures. And it leads
to economic exclusion and inefficient and very low quality service delivery in health and
education.

22. The analytical framework used to identify binding constraints starts from the notion
that to reduce poverty, household consumption has to increase. This can be achieved, for the
given income, by ensuring that consumption goods—food especially—becomes cheaper as
happens when food production increases. Alternatively, the household budget constraint can be

xiv
lifted by increasing the incomes of self-employed households, enhancing opportunities for wage
employment, or redistributing income from the nonpoor to the poor. Key environmental factors
affecting whether households can indeed obtain the fruits from their labor and investments are
exposure to risk (much of it weather risk); population (dependency ratios, gender practices); and
the overall governance environment which is understood to include the institutional environment
but also macro-economic governance, public finanancial and debt management and the business
environment. The various elements of the analytical framework are presented in Figure 6.2.

23. Opportunities to increase incomes of the self-employed lie largely in increasing the
productivity of agriculture. Once incomes in agriculture increase, opportunities for off-farm
activities can be expected to increase as well. The scope to increase agriculture productivity is
enormous. Limited access to irrigation leads to underemployment, low land productivity, and
exposure to weather risk. Farmers continue to rely heavily on the use of simple tools (hoes,
cutlasses, and spades) and techniques (manual weeding, hoeing, and harvesting), resulting in a
huge yield gap. Even if only half of the potential yield for rain-fed farming were to be attained,
millet yields would quadruple and sorghum yields almost 10-fold. Among the many reasons for
low yields, the immediate causes are soil degradation and the limited reliance on improved (let
alone hybrid) seed and other inputs (fertilizer, pesticide). Limited access to extension advice and
market interferences which reduce competition are also important obstacles to increasing farm
productivity.

24. Policies that lead to increased production of food crops consumed by the poor (millet,
sorghum, and cowpeas) are particularly attractive for poverty reduction. Increasing the
productivity of these crops offers three ways to poverty reduction: through increased production
(increased incomes); lower food prices (important for the rural poor who purchase food but also
for the urban poor); and increased demand for wage labor by commercial farmers.

25. There exists great potential for irrigation using groundwater. A back-of-the-envelope
calculation using information on the presence of aquifers suggests that at least 250,000 ha is
irrigable.3 As yields may increase to 6,000 kg if rice were cultivated, and two harvests a year could
be obtained, 250,000 ha could sustain a population of 48 million (exclusively rice eating) people.4
Irrigation thus has the potential to increase incomes in the short run, reduce vulnerability to weather
shocks, and avoiding a potential imminent Malthusian crisis as a result of high population growth
and dwindling access to fertile land. Successful irrigation does not necessitate investments in large-
scale infrastructure. A plot of 2,500 m2 can be irrigated by a solar pump presently marketed in
Kenya for approximately US$500. It is sufficient to feed a family of 48 people for an entire year.
Clearly there would be general equilibrium effects to consider if such a large scale program were
to be executed. Prices could drop considerably for instance which despite increased production
could have a negative impact on farmer income. A drop in income could be avoided if an irrigation
policy is accompanied by a market access (export) strategy and/or the development of value chains
for other produce. In that scenario, the (now lower) decine in prices and increased demand for
wage labor would be very beneficial for poor people who are net food buyers and those who

3
That is, the water table is at less than 8 m below the surface, a depth that allows the use of surface pumps, the land
above the aquifer is suitable to agriculture, a manually constructed borehole is feasible, and people live in the area.
4
Based on 374 calories per 100 gram of dry rice and total caloric needs of 2,100 calories per day per adult. Solar
pump specifications and cost (Practica: http://practica.org/projects/introduction-solar-irrigation-pumps/).

xv
depend on casual labor to make ends meet, while still raising income for net food sellers. Indeed,
irrigation plus market access is the package of reforms found to yield the best poverty reducing
results according to the CGE developed for this SCD.

26. Opportunities for wage employment (the second pathway) are limited. Few people are
employed in the formal sector, and with limited prospects for rapid industrialization, this will
remain the case in the foreseeable future. Casual labor opportunities on farm or in off-farm
enterprises, by contrast, are much more likely to emerge, particularly when agricultural
productivity increases.

27. Permanent migration is surprisingly unimportant. Despite the role that seasonal
migration plays in ensuring sustainable livelihoods and despite the importance of transhumant
livestock rearing, few Nigeriens migrate permanently. The majority of Nigeriens continue to live
in the place where they were born, and Niamey is a surprisingly small city with only 1.1 million
inhabitants in 2014 (compare, for instance, to 2.3 million for Bamako in Mali, a country with fewer
inhabitants than Niger: 15.8 million).5 Also in other countries of the region, there are fewer
Nigeriens than expected considering the population of the country. This limited migration is
surprising and the reasons behind it, and whether there is a latent demand for migration that
remains unmet, deserve to be investigated.

28. Social transfers are a third means to increasing household incomes. Social safety nets
can be used as short-term instruments to help the poor cope with economic shocks. They can also
operate as medium/long-term poverty alleviation programs, supporting minimum consumption
levels and promoting the accumulation of human and physical capital. When transfers are provided
over multiple periods to poor households, for instance, they are used to pay off debts, accumulate
productive assets, or buy inputs (fertilizer). 6 This enhances productive capacity and resilience such
that eventually these households no longer require support. Most social safety nets in Niger focus
on coping; only some are of the resilience-building type and none offer any guaranteed protections
in the sense that people affected by a shock can certainly rely on them (such as a standby cash for
work program). Structured well, social safety nets offer the opportunity to increase growth in a
pro-poor manner while also reducing poverty directly. Simulations carried out of this SCD suggest
that a combination of growth (2.4 percent per capita) over the next 15 years with perfectly targeted,
transaction-cost-free transfers to the equivalent of 2 percent of GDP is sufficient to achieve the
objective of poverty elimination by 2030. 7

29. To put Niger on a sustainable path of poverty reduction, a change in trajectory is

needed urgently. Though poverty reduced over the past decade, much of it can be attributed to
favorable external conditions which no longer exist. Natural resource prices have slumped, climate
change aggravates weather variability, and increased insecurity implies substantially larger

5
World Development Indicators. Niamey does not lie in Niger’s most fertile zone. However, unlike Mali, Niger has
a substantial number (13) of medium-size cities with more than 100,000 inhabitants (versus only 6 in Mali).
6
See, for instance, for evidence from Niger: Stoeffler, Quentin, and Bradford Mills. 2014. Households’ Investments
in Durable and Productive Assets in Niger: Quasi-experimental Evidences from a Cash Transfer Project. World
Bank Policy Research Working Paper no. 7839.
7
For comparison, in 2009, total tax exemptions were the equivalent of 1.9 percent of GDP (REDES 2011: rapport
sur les depenses fiscales au Niger).

xvi
spending on security and humanitarian assistance—the latter to deal with the large number of
refugees and displaced people with whom Niger is confronted. The economy of Nigeria is
experiencing a major recession and the naira has halved in value. It has led to reduced demand for
exports from Niger (goods as well as services - labor migrants) and increased imports from Nigeria
as a result. The combination of lower natural resource prices, increased competition from Nigeria,
and increased outlays for the security sector has created liquidity problems for the authorities.
Meanwhile, the pressure of higher population is making itself increasingly felt and a major climatic
shock is always a risk. As initial conditions remain poor 8 and levels of poverty extremely high,
and as the country looks increasingly fragile, business as usual will not suffice to sustainably
reduce poverty.

30. A citizen-centered approach is presented as the way to change the development

trajectory. Past approaches have not been able to deliver effectively: service provision is unequal
(focused on Niamey) and of low quality and low efficiency; large scale public investments are
inefficient; the business environment remains constrained and total factor productivity improves
only at a slow pace. An approach that targets citizens more directly and that pays more attention
to financing results as opposed to inputs offers promise. It strengthens local initiatives and decision
making, increases local incomes and autonomy, enhances access to information, and embraces
service delivery by whoever is capable of doing so. Such an approach would enhance ownership,
a precondition for sustainability, and move the focus of decision makers and development agencies
away from a centralized, state-led development model. As purchasing power is increasingly moved
toward local areas, it would provide incentives to private sector operators to invest in rural areas.
New technologies, cheap computing, mobile telephony, and solar energy, in particular, offer great
opportunities to accommodate a shift to citizen-centered approaches.

31. Three areas of binding constraints have been identified. These areas are informed by
descriptions of Niger’s economy, its long-term growth trajectory through economic
transformation, and the pathways to poverty reduction identified by the analytical framework. In
addition to these three areas, security has been identified as a precondition for development. Even
though it precedes any of these three areas of binding constraints, it is captured under the
governance constraint:
x Low rural productivity
x Inadequate human capital
x Poor governance
32. In the presence of multiple poverty traps, addressing one trap at a time is unlikely to
be effective. The implication is that preference should be given to integrated approaches that
address more than one problem at the same time.

33. Low productivity of key food crops and livestock is the first binding constraint to
poverty reduction. Modernization of the rural sector is held back by exposure to uninsured risk
and limited adoption of modern technologies. Where possible because of the availability of water,
(small-scale, solar) sustainable irrigation is critical. It reduces dependence on the weather, land

8
Low levels of human capital; an adverse business environment and a pattern of growth that favors
the non-poor.

xvii
pressure, and underemployment as multiple harvests are possible during the year. Implementing
an irrigation program will require close collaboration between those working on water
management, energy, agriculture, and finance (leasing) but also social protection as transfers can
be used as collateral and as means to entice households to diversify. Where sustainable irrigation
is not possible, access to improved seeds and other inputs in combination with agricultural
extension (to introduce climate-smart technologies, improve water management, and address soil
degradation) should be pursued along with activities that raise the productivity of livestock,
particularly birds and small ruminants, the animals most frequently owned by poor households.

34. Market access needs to be addressed too. Increasing farm productivity needs to go hand
in hand with improved market access,9 requiring attention to transport corridors, selected supply
chains, and promoting the transformation of agricultural produce. Improved farmer organizations
in cooperatives can also enhance market access. Crop markets are dominated by a small number
of powerful, politically connected traders who control all local purchases through their access to
capital and control over middlemen. Farmers who have joined in cooperatives can bypass these
middlemen and access markets directly. Investments in road infrastructure are less urgent. Niger’s
road network is not very dense but only in few areas would additional paved roads be economically
justified (that is, where there is traffic of more than 100 trucks a day). Given the generally dry
terrain, access problems are limited to the wet season. Improving access does not require
pavements but spot improvements in critical areas. Responsibility for such improvements can well
be given to local-level road maintenance groups that are paid and supervised by higher-level
authorities.

35. Low levels of human capital is the second binding constraint. The ability to work
productively is the core asset of poor individuals. As labor is the main asset of the poor, alleviating
this binding constraint is complementary to increasing rural productivity through supply- and
demand-side measures. Increased productivity leads to higher incomes, which leads to better
nutrition, which in turn improves the ability to work or to pay for health treatments. Literacy
provides farmers more access to new information and aids the adoption of new technologies, for
instance. Better-educated people are also much more likely to successfully migrate from rural to
urban areas or to other countries.

36. To address low levels of human capital, a first priority is service quality. Presently, the
quality of health and education services is so low that spending on the social sectors yields very
low returns. This needs to be addressed. Minimum levels of literacy and numeracy—for young
children and for adults—need to be ensured along with skills and competencies in areas critical to
development (health, education, extension). It requires investments in primary education, adult
literacy, and training at higher levels of education. Achieving the twin objectives of higher levels
of basic competencies and more people educated at higher levels requires a reconsideration of the
way the school system operates. An inclusive approach in the early years (when the unit cost of
schooling is low) may have to be combined with an exclusive one for higher education levels when

9
A Computable General Equilibrium (CGE) model developed for this SCD demonstrated that the largest impact on
poverty reduction comes from a combination of actions that raise farm productivity in conjunction with improved
trade facilitation.

xviii
unit costs are high. It requires stringent selection based on quality and, concomitantly, high dropout
rates.

37. A focus on skills and competencies should be accompanied by a focus on behavioral

change. Radio messages and shows and social and health workers can offer valuable information
on a wide range of issues from family planning to hygiene and healthy nutrition. Voter education,
adult literacy training, and greater transparency about budgets and spending decisions increase the
accountability of leaders. Relieving constraints to information requires investments not only in
information and communication technology (ICT) and mass media development but also in more
traditional channels of providing information including through extension officers.

38. Poor governance is the third binding constraint. Poor governance leads to low levels of
efficiency and productivity in the public and private sector. There are four aspects to this. First a
secure environment needs to be guaranteed. Unfortunately, security can no longer be taken for
granted. Easing the burden that conflict and forced displacement impose in some of the most
deprived areas of the country is important for poverty reduction and for preventing future conflict.
It also implies paying attention to mechanisms of conflict resolution; strengthening internal
security mechanisms (police, gendarmerie); and addressing illicit financial flows.

39. Next measures need to be taken to reach citizens directly and to empower them. It
entails moving away from a public sector-led provision of services to an approach that focuses on
the empowerment of citizens and service provision by whoever is best suited to doing so (private
sector, nongovernmental organizations [NGOs], civil society organizations [CSOs], public sector).
It will be facilitated by relying more on small-scale (as opposed to large-scale) interventions that
can more easily target poor households. Technological advances in ICT and biometric
identification and engineering (solar power, computing) make small-scale interventions and asset
provision (such as pumps) implemented at scale realistic. Other aspects to operationalize a citizen-
centered approach include improved access to information (as well as literacy), a better alignment
of the incentives of service providers with results (performance-based financing), promoting
private sector service provision where feasible, and greater emphasis on external/civilian oversight
on public institutions and services, notably at the local level.

40. To successfully engage citizens directly, the capacity of the central administration
needs to be improved as well. Addressing governance constraints in a competitive political
settlement with low bureaucratic capacity is a major challenge. A long-term strategy to build
capacity is required. Improving capacity across the board may not be feasible given the many
vested interests and inability to implement a long-term strategy, but an opportunistic approach is
achievable. After all, the state is a complex organization machine, whose actions are shaped by its
actors, officials and bureaucrats; their histories and personalities; and the incentives they face.
Within the state, ‘islands of effectiveness’ already exist. Others could possibly be created in areas
such as education, health, agricultural extension, PFM or statistics—the latter especially when
statistics are used to assess the performance of service providers.

41. Third, economic opportunities need to be realized. In addition to the agro-industrial

sector, which was identified under the first area of constraints, this holds good for the telecom
sector—which plays a critical role in developing citizen-centered approaches and for the mining

xix
sector which, provided it is transparently managed, has much potential for growth, developing
forward and backward linkages, and contributing to public revenue. Cities, primary as well as
secondary cities, should be seen as centers of economic growth and transformation. To make them
productive, sufficient attention needs to be paid to city planning and management; infrastructure
provision (roads, energy, water and sanitation, telecom); and assurance of a conducive business
environment for formal as well as informal sector activities.

42. Finally, improved public financial management (PFM) is critical, on both the revenue
side and spending. Too much money is ‘lost’ through tax exemptions or through tax evasion
(informal trade), through nontransparent procurement procedures, and because of poorly selected
and executed investment projects. It is a problem that has long been flagged, which needs to be
addressed as a matter of urgency. The vulnerability of the economy to the oil-price shock and the
associated devaluation of the naira highlight the need to come up with policies to better deal with
economic shocks—particularly as the country has no means to deal with economic shocks through
its monetary instruments which are all managed at the regional level. It can be done by creating
financial buffers in times of plenty or by developing insurance instruments that cushion shocks
when they materialize.

Figure E.1: Poverty and the potential to increase agricultural productivity through irrigation
The distribution of the poor, in both rates and numbers, is spatially defined, with the poor located where
agricultural activity takes place.
Poverty incidence and number of poor Number of poor and GDP

Agriculture, in turn, is largely driven by water availability. Tapped sustainably, the presence of groundwater at
low depth in areas where many poor live creates scope for poverty reduction through irrigation.
Number of poor and groundwater depth Groundwater storage and poverty

Source: World Bank 2016 staff and M. MacDonald, H.C Bonsor, B.E. O Dachartaigh and R.G Taylor (2012)
Quantitative Maps of Groundwater Resources in Africa, Environmental Research Letter.

xx
 Figure E.2: Demographic challenges
Even though under-five mortality has declined very rapidly, and much faster than in other countries in the region,
population growth has in fact increased as fertility remains very high and the crude birth rate has not declined as
fast as the crude death rate.
Under-five mortality rate (per 1,000 live births),
1990 and 2015
400 328
254 238 215
177
200 115 139 130
96 94

0
Niger Mali Guinea Chad Central
African
1990 2015 Republic
The scope for reducing fertility is limited as wanted and total fertility do not diverge much.
Total fertility rate (per woman) Observed and wanted
1990 and 2015 total fertility rate
10
7 7 7 7 by wealth quintiles (per woman)
6 6 6 10 8 8 8 8
5
4 6
5 4
7 7 7 7
5
5

0 0
Niger Mali Guinea Chad Central Lowest Second Middle Fourth Highest
African
1990 2015 Republic Observed fertility Wanted fertility
Rapid population growth leads to high dependency ratios, much higher than other countries in the region even.
Niger 2015 Male Mali 2015 Male
80+ 80+
Female Female
70-74 70-74
60-64 60-64
Age group

Age group

50-54 50-54 100.2

40-44 113.0 40-44
30-34 30-34
20-24 20-24
10-14 10-14
0-4 0-4
8 4 0 4 8 4 2 0 2 4
Population (milllions) Population (milllions)
Even if fertility is effectively adressed, the total population increase that Niger faces is dramatic, putting increasing
pressure to increase productivity in agriculture in a setting where the the availability of fertilie land is limited.
2050-Low variant Male 2050-High variant
80+ 80+ Male
Female
70-74 70-74 Female
60-64 60-64
Age group

50-54 50-54
40-44 40-44
80.2 93.4
30-34 30-34
20-24 20-24
10-14 10-14
0-4 0-4
8 4 0 4 8 8 4 0 4 8
Population 66.7 millions Population 78.0 millions
Source: World Bank. 2016. Demographic Challenges and Opportunities in the Sahel and Central Africa.
.

xxi
1. Introduction
1. Located in the Sahel, Niger is in many ways defined by its natural environment. With
a land area of 1,267,000 km2, Niger is the sixth biggest country in Africa and the biggest in West
Africa. The country is landlocked and the closest port, Cotonou, is over 1,000 km away. Niger has
5,700 km of land borders, a high proportion of which run through sparsely inhabited regions that
are difficult to govern. Niger is located at the heart of a turbulent region marked by political and
religious violence in northern Nigeria, separatist and armed movements in northern Mali, and
intercommunal violence and state collapse in southern Libya. In the Diffa region and certain zones
in the regions Tillabery and Tahoua a state of emergency has been declared and there are an
estimated 198,000 refugees and 137,000 internally displaced persons in Niger.10 Niger participates
in a number of regional institutions, including the West African Economic and Monetary Union
(WAEMU), a customs and currency union, of which all eight member states use the CFA franc
(CFAF). Niger is also a member of the Economic Community of West African States (ECOWAS),
a broader organization that promotes regional peace, stability, and justice.

2. Niger’s population of 19.9 million (in 2015) is unevenly spread throughout the
country. An estimated three-quarters of the population live in the south, where practically all the
country’s arable land (12 percent of the surface area) is located. Conversely, some parts of the
north are almost uninhabited. The population is mainly rural—only 18 percent of the population
live in urban areas, Niamey in particular. A demographic transition—the shift from high to low
mortality and fertility levels—has begun through an impressive decline in child mortality. However,
fertility remains high and has actually increased in the last five years to 7.3 children per woman. The
population is estimated to increase to 30–35 million by 2030 and between 67 and 78 million by 2050.
Persistently high fertility and declining child mortality have resulted in a very young age structure,
with 49 percent of the population below 15 years of age and a child dependency ratio of 105, meaning
that there are 1.05 children for each person of working age. The presence of such a large share of youth
has implications at both the household and national levels in terms of health, nutrition, food security,
human development, demand for jobs, and economic growth and stability.

3. With a per capita GDP of US$895 in 2015 (constant 2011 U.S. dollar), Niger is among
the poorest nations in the world. The vast majority of Niger’s 8.2 million poor (2014 estimate)
live in rural areas where food insecurity is high. Human development indicators are concomitantly
low. The average level of education is 1.4 years; only 52 percent of children have received a
complete set of vaccinations and 44 percent of children under five are stunted.

4. People’s livelihoods are dependent on (rain-fed) agriculture and (extensive) livestock

rearing. The agriculture and livestock sectors together engage more than 80 percent of the
workforce and account for 40 percent of GDP. Agricultural productivity is low, particularly of
women farmers,11 and farming is characterized by smallholders tilling the land with limited

10
World Bank, and UNHCR (United Nations High Commissioner for Refugees). 2016. “Forced Displacement by
the Boko Haram Conflict in the Lake Chad Region.” Data provided by UNHCR Niger in May 2015.
11
Backiny-Yetna and McGee (2015) find that in Niger, plots managed by women produce 19 percent less per
hectare than plots managed by men. The primary factors that contribute to the gender productivity gap in Niger are
(a) farm labor, with women facing significant challenges in accessing, using, and supervising male farm labor; (b)
the quantity and quality of fertilizer use, with men using more inorganic fertilizer per hectare than women; and (c)
land ownership and characteristics, with men owning more land and enjoying higher returns to ownership than

1
mechanization, using little chemical inputs, and relying much on labor inputs while practicing
limited soil conservation strategies and in the general absence of enabling infrastructure for
agricultural development. Farmers rely heavily on the use of simple tools (hoes, cutlasses, and
spades) and techniques (manual weeding, hoeing, and harvesting). Soils are generally not very
deep, with low water retention capacity, low organic matter content, and easily eroded by wind or
rain. These characteristics get reflected in the most pressing problems identified by the population
in the 2015 Afrobarometer survey: food shortage, water supply, health, and poverty all feature
prominently (Figure 1.1).

5. Livelihood systems differ between ethnic groups living in Niger. While some ethnicities
such as the Hausa traditionally live in fixed locations, other groups such as the Peulh and Tuareg
have a tradition of ‘stateless societies’.12 Hausa, who make up more than half of the country’s
population are traditional subsistence farmers, living from staple grains. Another agricultural
group is the Djerma-Songhai. The (semi) nomadic Peulh base their livelihoods on animal
husbandry and largely depend on the natural productivity of grasslands. From the beginning of the
dry season, when pastoralists move down southwards to water their livestock from surface ponds,
vegetation on agricultural fields is used as temporary pasture. Hausa and Peulh traditionally share
a mutually beneficial relationship, as farmers exchange grain or crop residues for manure produced
by herders’ livestock.13

Figure 1.1: Challenges faced by Niger

Food security and access to water, health, and poverty Under favorable external economic circumstances,
are the main concerns of the population. Niger increased its GDP per capita substantially less
than its neighbors.
Most important problems GDP per capita 1990–2014
Male Female
60 55 200
4950 180
50 46
Index GDP per capita (1990=100)

38 160
40 36
34
140
30 120
21
18 18 17 18
20 14 16 100
13
11 11 10 1010
7 80
10 5 5
3 32
60
0
40

20

0
2005
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004

2006
2007
2008
2009
2010
2011
2012
2013
2014

Burkina Faso Mali Niger Chad

Source: Afrobarometer 2015; World Bank, World Development Indicators (WDI) 2015.

6. Niger’s subsistence agriculture is based on cereal crops (millet and sorghum) as well
as cow peas. Together, these crops take up most of the cultivated area and constitute the staple

women. Prospere Backiny-Yetna and Kevin McGee (2015). Gender Differentials and Agricultural Productivity in
Niger. World Bank Policy Research Working Paper No. 7199.
12
Thomson, J. T. “State Theory and Practice in Francophone Africa: French Roots and Perspectives.” Paper
prepared for presentation at a colloquium held at the “Workshop in Political Theory and Policy Analysis”, February
26, 1996
13
For example, Thébaud, B., and S. Batterbury. 2001. “Sahel Pastoralists: Opportunism, Struggle, Conflict and
Negotiation. A Case Study from Eastern Niger.” Global Environmental Change 11: 69–78.

2
diet of the majority of the population. Despite opting for drought-resistant crops, there exists a
great vulnerability to climatic hazards. Inadequate yields, poor diversification of incomes, climate
change, and increasing pressure on land due to population growth are the reasons why economic
and food insecurity persist and why levels of malnutrition are high. Niger is a net importer of food
(food is the 2nd most important import good after capital goods). Many Nigeriens undertake
seasonal migration to Nigeria and other countries in the region to make ends meet. Seasonal
migration ensures that there is a mouth less to feed and allows migrants to earn an income during
the off-season.

7. Extractive industries form an important part of the economy. Uranium has been mined
since the 1960s by companies dominated by French capital. Uranium production is expanding and
once the Imouraren mine in the Agadez region becomes operational (originally expected in 2016,
but now postponed following the fall in uranium prices), Niger is projected to become the world’s
second largest supplier of the metal. 14 Gold production has also increased in recent years.
Traditionally, the mineral has been mined artisanally and Niger’s first commercial gold mine only
began operating in 2004. A Chinese company, the China National Petroleum Corporation (CNPC),
extracted the first barrels of oil in 2012. Income from mining accounts for a significant proportion
of state revenue, 22–25 percent, in the recent past and minerals remain a coveted strategic resource.
Niger has been compliant with the requirements of the Extractive Industries Transparency
Initiative (EITI) since 2011.

8. Niger has a complex political settlement with multiple actors balancing each other out
in a dynamic but relatively stable equilibrium. Among the core players are the military, a group
of lifetime politicians, and powerful traders as well as selected traditional leaders, sheikhs, and
religious leaders. This ‘political class’ has created a political settlement which presides over an
uneducated, uninformed population with limited voice due to the need to associate oneself to
powerful principals to protect against shocks. As a consequence of the competitive nature of the
political settlement, politics has been volatile but rarely violent. Since independence in 1960, Niger
has had no less than seven republican regimes and four military coups. The latest dates from 2010
when military officers overthrew President Mamadou Tandja, who had been in office since 1999.
They quickly returned power to civilians, and in 2011, President Mahamadou Issoufou inaugurated
the Seventh Republic and embarked on an ambitious ‘Renaissance’ program. He was reelected in
2016.

9. Niger’s political settlement and history of frequent political uprisings casts a shadow
over its development prospects. While the country recently completed parliamentary and
presidential elections it remains fragile as internal and external security stresses threaten a delicate
political balance.15 Corruption, clientelism, and impunity are endemic; civil society is weak and
co-opted; and the rate of change slow. Niger’s competitive political settlement and personalized
bargaining among elites favors short-term fixes over solutions that take a long term to materialize.
Popular frustration and low capacity of the state to provide tangible services feed the expansion of

14
Others are also investing in uranium. GoviEx, a Canadian firm, got an exploitation licence in January 2016 to
exploit the Madaouela Mine not far from the Arlit Mine. It entails a US$676 million investment.
15
Several risk factors, including a major drought or a tightening of the elite coalition, could trigger instability and
violence. Niger thus remains a country whose future is more worrying than its current state of fragility.

3
an Islamic civil society that is particularly vocal in its criticism. It can represent a radical,
potentially violent protest movement or a peaceful attempt to ‘re-moralize’ public life.

Figure 1.2: Structural challenges to economic development

The majority depend on rain-fed agriculture in an Human capital is low. Malnutrition is widespread
environment in which rains are unpredictable and and levels of education, though improving, are
growing seasons short. extremely low.
Rainfall by agro-ecological zone Completed levels of education

200 100% 1 0 2 2 12
4 5 3 3 3 3
175 6 5 3
180 168 13 6 9
90% 12 11 8
10 18 10
160 149 13
80% 12
129 128 15 24
140
70% 17
120
98 60%
100 20
75 50%
80 92
64 82 81 86
54 55 56 40% 80 76 74
60 67
39 30% 60
40
19 15 16 20% 42
20 7 5 0 7
0 0 0 4 0 0 0 0 1 1 0 0 0 1 4 0 0
10%
0
December

December

December
May

May

May
April

April

April
June

June

June
October
November

October
November

October
November
September

September

September
August

August

August
January
February
March

January
February
March

January
February
March
July

July

July

0%

None Primary Secondary - first cycle Secondary - second cycle and above
Agricultural (Maradi) Agro-pastoral (Zinder) Pastoral (Tahoua)

Niger is landlocked, transport costs are high, and access Despite a vast land area and high transaction costs,
to markets is limited to regional markets, particularly in mobile telephony is underdeveloped.
Nigeria.
$543

129
Cost of exporting Mobile telephone subscriptions
$490

$486

108

92 95
$204

$191

70
$175
$163

66
$155
$144

$143

62
$111

$96

$86

$33

$25

39
$17

27
Senegal

Senegal
Togo

Togo
Niger

Niger
Kenya

Kenya
Ghana

Ethiopia

Mali

Ethiopia

Ghana

Mali
Burkina Faso

Burkina Faso

Cost to export: Border compliance (US$ per Cost to export: Documentary compliance (US$ per Ethiopia Niger Togo Burkina Kenya Senegal Côte Ghana Mali
hi t) hi t) Faso d'Ivoire

Rapid population growth puts a strain on (natural and A decline in uranium prices puts pressure on state
public) resources. finances.
Population Uranium price (US$ per pound)

25 140

120
20
100

15 80

60
10
40

5 20

0
Sep-89

Sep-96

Sep-03

Sep-10

0
Mar-86

Jul-88

Mar-93

Jul-95

Mar-00

Jul-02

Mar-07

Jul-09

Mar-14
Nov-90

Nov-97

Nov-04

Nov-11
May-87

May-94

May-01

May-08

May-15
Jan-92

Jan-99

Jan-06

Jan-13
1968

2010
1960
1962
1964
1966

1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008

2012
2014

Source: Rainfall: http://www.cameroon.climatemps.com/; Education Living Standards Measurement Study -

Integrated Surveys on Agriculture (LSMS-ISA) 2011; exports: Doing Business 2016; population: WDI 2016;
uranium price: IMF 2016.

4
10. Low levels of education, a small domestic economy, limited productive knowledge,
being landlocked, and high transaction costs limit the scope for rapid economic
transformation through leapfrogging or import substitution. It leaves open the ‘classical’ path
to economic transformation. In this process, agricultural and livestock sector output grow by
expanding the area under cultivation and through productivity gains powered by the adoption of
new technologies. As the share of food consumers relative to food producers grows through
urbanization, markets become more important, the nonfarm and agribusiness sectors grow, and the
food value chain and rural-urban linkages are strengthened. As incomes grow, second-order effects
are likely to emerge: the stock of human and physical capital increases as households invest part
of their increased incomes, leading to further productivity gains, to migration of (now better-)
educated people to urban areas (which supports the realization of positive agglomeration effects)
and to demographic transition (in part because women marry later and because fertility rates tend
to drop with increases in income). To rapidly reduce poverty in the short run, Niger will need to
harness this process.

Figure 1.3: Economic opportunities

Though landlocked, Niger can benefit from the presence of a big market in Nigeria as well as from exploiting its
various geological resources. For the latter to succeed and to contribute to revenue mobilization, much attention
will be needed to ensure transparent governance of the sector.
GDP density Mineral map

Source: World Bank 2015 and Economist Intelligence Unit (EIU) 2009.

11. Much of Niger’s economic future will depend on economic developments in Nigeria.
Rapid growth in Nigeria implies opportunities for export and labor migration. Nigeria’s economy
is facing strong headwinds, with significant and negative repercussions for Niger’s economy.

12. This SCD aims to identify the constraints and opportunities for achieving the twin
goals of ending poverty and boosting shared prosperity by 2030 in a sustainable manner
while acknowledging (a) the need for selectivity in pro-poor interventions, among the many
competing ‘binding’ reasons for poverty in Niger and (b) the need to identify constraints that can
feasibly be addressed. The twin objectives are considered to overlap because the incidence of
poverty, using the national poverty line, is 45 percent. The document thus focuses on reducing
headcount poverty. The objectives of the World Bank are closely associated with those of the

5
Government of Niger, which aims in its Renaissance Program to achieve rapid poverty reduction
by 2035.

Box 1.1: Informal trade in scarcely populated areas presents a governance risk
Informal trade is a core activity for a landlocked country such as Niger whose economy is closely integrated into
West and Northern Africa. In the southwest part of the country, Djerma and Songhai traders maintain close relations
with Burkina Faso, Ghana, Côte d’Ivoire, and Mali. In the south and east of the country, the key commercial
Haoussa centers, Maradi and Zinder, have close trade and family ties to northern Nigeria. The Kanura population
of Diffa is deeply connected to the Lac Tchad trade with Chad, Nigeria, and Cameroon. In the northwest (Agadez
and Arlit), Arab networks control the trade with Algeria and—to a lesser extent—Libya, while in the northeast,
Tubu dominate the exchanges with Libya.
Informal trade across the desert has a long history in Niger and is rooted in the ancestral caravan trade. This trade
took a different turn when in the 1970s, Algeria and Libya began subsidizing fuel and basic foodstuffs. It created
new commercial opportunities in which traders from the south of these countries exchanged food and fuel for
livestock with the nomadic population from northern Niger and Mali. They exported increasing quantities of
animals to Algeria and Libya, with the vast majority evading official trade circuits.
As the long-distance trade networks developed and became more profitable and organized some networks engaged
in cigarette smuggling from West African ports, with Niger as a key hub. Others got involved in drug trafficking
(hashish, cocaine, medicines, and so on), weapons smuggling, and human smuggling. What started off as an
informal trade thus grew into organized crime supported by, at times, heavily armed militias.
The emergence of this organized crime has had political consequences. Struggles over the control of the illicit
products, especially drug convoys, contribute to tensions along ethnic and tribal lines and even with the Nigerien
security forces. The empowerment of local communities as a result of the illicit economy has provided an impetus
for the reassertion of ethnic identities. To appease ethnic groups from the north, Tuareg and Tubu are prominent in
the national political and security system, while those who are not fully integrated benefit from a certain liberty to
smuggle and traffic.

13. Accelerating poverty reduction in Niger presents a huge challenge. Niger reduced
poverty by 9 percentage points over the past 15 years and made progress on a number of social
indicators such as access to education and reducing child mortality. It did so under relatively
favourable circumstances, with respect to the weather, commodity prices, and security.
Nonetheless, per capita GDP in 2014 was at the same level as it was in 1990 (see Figure 1.1).
Recently, the external environment has changed. The commodity price boom is over, insecurity
and extremism are unfortunate realities, and climate change is becoming more manifest.
Meanwhile, Niger’s structural constraints remain unchanged (landlocked, low levels of human
capital) while high population growth puts ever more pressure on limited natural resources, land,
forest resources, and water. It underscores that to reduce poverty in the future a major shift in
trajectory will be needed: to overcome Niger’s structural constraints and to counterbalance the
challenging external environment.

14. The remainder of the document is organized as follows. Chapters 2 to 5 provide

background material on Niger, starting with poverty, risks, and vulnerability in Chapter 2 and
human capital in Chapter 3. After these micro-oriented chapters, the document discusses the
economy and opportunities for growth in Chapter 4 and governance in Chapter 5. Armed with this
information, Chapter 6 sets out to identify binding constraints. The analytical framework is
introduced along with the main pathways to reduce poverty. Informed by these pathways, three
areas of core binding constraints are finally presented and discussed.

6
 Figure 1.3: Niger’s Human Opportunity Indicators relative to comparator countries
Niger has the lowest attendance rate for primary… …and secondary education.
% of children attending school (ages 6–11) % of children attending school (ages 12–15)
84 86 91 92 88 90 94
84 85
79
75 77
73
61
55 57 58
51
46
37 35
33

Primary school completion rates are dismal. Many children are malnourished…
% of children ages 12–15 attending or having Rate of non-stunted children (% of 0–2-year-olds)
completed 6th grade 63 63 64 64 65
69 74 75

59
82 55
49

55
51

32 34
27
22 22
15
9 10

…and do not receive basic immunization. They grow up in households without electricity…
% of children immunized against measles, DPT, % of children (ages 0–16) living in a household
BCG, and polio with access to electricity
81 52
50
70
64 66
63 41

50 51
47
28
34
30
27
14 15 15 15
8 9
6

…and sanitation. Nonetheless, most households seem to have access to

a water source.
% of children (ages 0–16) living in a household % of children (ages 0–16) living in a household
with a flush or pit toilet latrine without access to piped, well, or rainwater
87 89 91
80 80 82 98
95 96
73 87 88
67 80 83

55 69
51
53
43
34
18

Source: World Bank, Inequality and Human Opportunity Index (values circa 2008).
Note: DPT = Diphtheria, Pertussis, and Tetanus; BCG = Bacillus Calmette-Guérin.

7
2. Poverty, Risks and Vulnerability
2.1 Poverty and Poverty Trends

15. The incidence of poverty remains very high, despite a 9 percent decline since 2005.16
Poverty incidence declined from 53.7 percent in 2005 to 44.5 percent in 2014. Poverty declined in
rural and urban areas, but the reduction was much more substantive in the capital city and in other
urban areas, declining from 29.6 in 2005 to 8.7 in 2014. Note that while the reported decline in
poverty is encouraging, it is likely to overstate actual progress made as the 2005 survey came
following a drought year, whereas the 2014 survey was implemented during a relatively normal
year. It underscores the difficulty of assessing poverty trends in Niger, as the consequences of
different levels of rainfall can easily overwhelm the impact of structural change, at least in the
short run. It makes it very hard to discern signal (structural changes) from noise (annual rainfall
variation).

16. In rural areas, poverty is widespread and the number of poor increases by the
thousands every year. In 2014, 51.4 percent of the rural population was estimated to be poor,
against 58.6 percent in 2005. Despite this drop, the absolute number of rural poor increased by 1.8
million people as a result of rapid population growth. The rural poor also became poorer relative
to their urban counterparts. In 2005, rural poor per capita consumption represented 60 percent of
that of the urban poor. By 2014, it declined to 43 percent.

Figure 2.1: Poverty incidence and number of poor

A strong decline in poverty but an increase in the number of poor particularly in rural areas.
Poverty incidence (%, 2005-2014) Number of poor (millions, 2005-2014)
60 9
58 58 8
7 7
53 54 7
52 51 8
50 48 7
6 6
7 6
44
40 6

32 5
30
27 4
26
22
20 3

14 2
10 10 10
1 0 0 0 0 0
5 0 0 0
0 0
2005 2008 2011 2014 2005 2008 2011 2014

Niamey Other Urban Rural Niger

Niamey Other Urban Rural Niger

Source: Authors’ calculations using Unified Questionnaire of Basic Indicators of Well-being (Questionnaire Unifié
des Indicateurs de Base de Bien-être, QUIBB) 2005; National Household Budget and Consumption Survey (Enquête
Nationale sur le Budget et la Consommation des Ménages, ENBC) 2008; LSMS-ISA 2011 and 2014.

17. Consumption growth benefited almost everybody, but better-off households benefited
most. Growth in real per capita consumption benefited everyone except those in the poorest decile.
As can be seen from the growth incidence curves (Figure 2.2), the distribution of growth worsened
between 2011 and 2014 relative to 2005–2011. Between 2005 and 2011, average per capita

16
Poverty numbers presented in this document differ from official poverty numbers for Niger as the available
consumption data from the various surveys were transformed to assure comparability across time. The decline used
in this SCD is less than the decline suggested by Niger’s official poverty numbers which put poverty at 62 percent in
2005, 60 percent in 2011, and 48 percent in 2011 (INS 2015: Tableau de Bord Social).

8
consumption growth was positive for every percentile of the distribution even though it was higher
for the richest segment of the population. Between 2011 and 2014, the poorest 30 percent of the
population experienced a decline in real per capita consumption of up to 10 percent, whereas the
better-off experienced even higher rates of consumption growth. As a consequence of the pro-rich
pattern of consumption growth, inequality increased.

Figure 2.2: Growth incidence curves and elasticity

Growth has benefited most of the poor, but the better-off The poverty to growth elasticity exceeds the average
benefited more. for Sub-Saharan Africa.
Real cons. growth incidence curve (%, 2005–14) Poverty-consumption growth elasticity (2005–14)
60 2005-2011 2005-2014 2011-2014
0

50 -0

40 -0

-0
30
-0
20
-1 -0
-0
10 -1

0 -1
1
4
7
10
13
16
19
22
25
28
31
34
37
40
43
46
49
52
55
58
61
64
67
70
73
76
79
82
85
88
91
94
97
100

-1
-10
2005-2011 2011-2014 2005-2014
-1
-20 -1
-2

Source: Authors’ calculations using QUIBB 2005, ENBC 2008, and LSMS-ISA 2011 and 2014.

18. Poverty reduction is relatively responsive to consumption growth. The growth

elasticity of poverty, which measures the percentage change in the poverty headcount for each
percentage point change in consumption, shows that in Niger an annual growth in consumption of
1 percent leads in general to an annual decrease in poverty of 1 percent. This elasticity is higher
than the average 0.7 consumption growth elasticity for Sub-Saharan Africa.

Figure 2.3: Poverty decomposition

Poverty reduction is driven by growth… …and not by internal migration
Growth-redistribution decomposition (2005–2014) Urban-rural decomposition (2005–2014)
Growth component Redistribution component Interaction component Total Intra-sectoral effect Population-shift effect Interaction effect
10 2
5 0 0
5
4
5 2 0
1
0 -0 -0
0 -2

-5 -4

-6 -5 -4
-10
-9 -9
-8
-15

-10
-20
-20
-12
-25

Source: Authors’ calculations using QU IBB 2005, ENBC 2008, and LSMS -ISA 2011 and 2014.

9
19. Reduction in poverty is driven by internal dynamics in urban or rural areas and not
by rural to urban migration. The spatial distribution of the population in Niger has changed little
over the past two decades. In 2014, more than 90 percent of the rural population lived in the same
villages as where they were born. Between 2005 and 2011, of the total 5.5 percentage point decline
in poverty, only 0.14 percentage points was due to rural-urban migration).

20. High population growth exacerbates poverty in Niger. Unlike in most countries,
population growth is on the rise. It increased from 3.1 percent between 1988 and 2001 to 3.9
percent between 2001 and 2012. The high population growth rate is due to persistently high fertility
rates and a rapid decline in child mortality (Figure E.2). The annual population growth rate of 3.9
percent is four times the annual pace of poverty reduction between 2005 and 2014 (1 percent). As
a result, the absolute number of people living in poverty continues to rise.

21. High fertility rates are poverty increasing for a number of reasons. They are associated
with large families and high dependency ratios factors that are positively associated with poverty.
High dependency ratios reduce the ability to save and invest in human and physical capital, thus
perpetuating poverty as families opt to rely more on labor and invest less in the education and
health of their children. High fertility also has negative consequences for women’s health and
nutritional status—and consequently for their capacity to work. Poor women’s health, in turn, has
a negative effect on the health of their offspring.

Figure 2.4: Population growth rate and poverty incidence by region

While poverty and population growth are closely related, at the regional level the correlation between population
growth and poverty is weak. One reason why this may be the case is because regional poverty levels change a lot
from one year to the next.
Population growth rate (%, 2001–2012) Poverty incidence (%, 2011 and 2014)
Agadez 20
Agadez 3 9 2011 2014

Diffa 34
Diffa 4 32

Dosso 52
Dosso 2 57

Maradi 3 Maradi 57
66

Tahoua 4 Tahoua 47
27

Tillaberi 3 Tillaberi 56
40
Zinder 4 47
Zinder 53
Niamey 2 10
Niamey 5
Niger 3
Niger 48
45
0 1 1 2 2 3 3 4 4 5 5
0 10 20 30 40 50 60 70

Source: INS 2012 and LSMS-ISA 2011/2014.

22. Poverty incidence varies considerably from one year to the next. Figure 2.4 illustrates
how poverty can vary over a short period. Changes in poverty are largely a reflection of differences
in the weather. Between 2011 and 2014, for instance, poverty declined by almost 10 percentage
points in Agadez but increased by about 9 percentage points in Maradi. These large variations
suggest the presence of high levels of transitory poverty with people switching between being poor
and nonpoor on a regular basis.

10
23. In spite of the large annual variation in the incidence of poverty, one can discern two
geographic poverty clusters. There are the lower poverty regions which include the capital city
of Niamey, Agadez in the north, and Diffa in the northeast. These three regions comprise 12
percent of the population and less than 5 percent of the poor. The high poverty regions are the
remaining five regions in the southwest of the country (Tahoua, Dosso, Maradi, Tillaberi, and
Zinder). Among these, Maradi has the highest incidence of poverty, 67 percent, and the highest
concentration of poor people. Thirty percent of the poor in the country live in this region.

Figure 2.5: Poverty and agro-ecological zones

Poverty incidence is highest in agricultural and agro-pastoral zones,…
Agro-ecological zones Poverty headcount (%, 2014)
60 56

51
50

40 36

30

20

10
10
5

0
Niamey Other Urban Agricultural Agro-pastoral Pastoral

…but the majority of the poor (65 percent of the poor or 5.3 million people) live in the southern agricultural
zone.
Number of poor (millions, 2014) Share of poor and population (%, 2014)
6
5 70 65

5 56
60

50
4
40

3 30 25
20
2
20
2 10
5 5 6
10
0 2
1 0
0
0 Niamey Other Urban Agricultural Agro-pastoral Pastoral
0
0 share poor (%) share population (%)
Niamey Other Urban Agricultural Agro-pastoral Pastoral

Source: Authors’ calculations using LSMS-ISA 2014.

24. Poverty incidence varies by livelihood zone. The combination of rainfall and
groundwater availability broadly defines different livelihood zones. Four zones are identified
(Figure 2.5). Below the desert lies the pastoral zone. With a rainfall of 100–300 mm per year and
subdesert climate, it is almost exclusively used for transhumant cattle herding though growing
population pressure has led to an encroachment of agriculture along its southern part. The second
zone is the agro-pastoral zone. It receives 300–500 mm of rain per year and is suitable for the
extensive farming of millet. Yet, due to low yields, most households do not produce enough food
to feed themselves throughout the whole year, and they thus engage in goat rearing, casual labor,
small trade, and seasonal migration. The third zone (south Maradi, south Zinder and Dosso) is
characterized by 500-600 mm of rain per year and semi-intensive rain-fed agricultural practices

11
and livestock rearing. Finally, irrigated cash crops are grown in small patches along the Niger
River. Poverty incidence is high in the rural agricultural zones. Sixty-five percent of the poor,
representing 5.3 million people, are located in this zone. The agricultural zone is also where the
majority of the population, 56 percent, reside.

2.2 Poverty Profile

25. The characteristics of the Nigerien poor are not different from those elsewhere in the
subregion. The poor tend to live in larger households and households with high dependency ratios.
Households with younger or older heads tend to be poorer. The poor also tend to be more isolated,
living at greater distances from key infrastructures and institutions. The poor lack education;
however, education below secondary high school level has no poverty reduction effect on rural
households. Households with heads employed in the public service or in nonagricultural activities
are less likely to be poor. (Annex 1 presents regressions which show the poverty profile in greater
detail.)

26. Poor rural households are highly dependent on the market for food to meet their
consumption needs. Even in the agricultural livelihood zone, more than 60 percent of the food
consumed by poor and nonpoor households is purchased (Figure 2.6). Households, even those
depending on subsistence agriculture, are unable to produce enough to cover their own needs.

Figure 2.6: Sources of food consumed and sources of cash income agro-ecological zones
Poor purchased more than 60 percent of foods consumed using cash obtained through agricultural wage and
nonfarm income.
Sources of food consumed, 2014 Sources of cash income, 2014
Pastoral Pastoral
Richest quintile
Richest quintile

Agro-pastoral Agro-pastoral

Agricultural Agricultural

Other urban
Other urban
Niamey
Niamey

Pastoral
Poorest quintile

Pastoral
Poorest quintile

Agro-pastoral
Agro-pastoral
Agricultural
Agricultural
Other urban
Other urban Niamey
Niamey 0% 20% 40% 60% 80% 100%
0% 20% 40% 60% 80% 100% Agricultural wage Non agricultural wage Farm-crops sales
Bought Produced on the farm Donations Farm-livestock sales Non farm income Transfers

Source: Authors’ calculations using LSMS-ISA 2014.

27. The majority of rural poor earn the greater part of their cash income through labor
and not from crop sales. The poorest in the agricultural and agro-pastoral zones derive about 25
percent of their cash income by working on other people's fields (Figure 2.6). This is probably an
underestimation because poor farmers also receive in-kind compensation for their labor. The
poorest rural households also obtain a large fraction of their cash income from livestock sales and
self-employment. The poor in the agricultural zones derive 15 percent of their income from sales
of livestock and about 20 percent from nonfarm businesses. Annual earnings from livestock
exceeds income from crops sales even in regions where agriculture is considered the dominant
activity.

12
28. Agricultural land, a key asset in rural areas, is unequally distributed. Agriculture in
Niger is basically a smallholder farming sector, with only a limited number of large-scale
commercial/state farms. More than 60 percent of all agricultural landholdings are less than 5 ha.
Land is much more unequally distributed than consumption. The Gini coefficient for land is 0.46
compared to 0.34 for consumption. Poverty incidence among farmers averages 55 percent, and the
size of cultivated area per household matters only beyond 10 ha. Poverty rates among farming
households owning more than 10 ha is 20 percentage points lower.

29. Livestock, a key asset for cash income generation, is very unequally distributed.
Livestock is an important source of income in the economy and an important export product. In
the agricultural and agro-pastoral zones, more than 70 percent of poor households do not own a
single cow. Even in pastoralist zones, 65 percent of poor households own no cattle. The Gini
coefficient for livestock ownership is estimated at 0.68, which is double that for consumption. The
10 percent wealthiest own 90 percent of all animals. Even more than access to land, does livestock
ownership determine a family’s wealth. Better-off households use large animals on their farms to
increase their crop production, but they also use them as saving and investment good. Poverty
among households owning fewer than 10 animals averages 50 percent; it is 10 percentage points
lower for households owning more than 10 animals.

Figure 2.7: Inequality in land and livestock ownership

The two most important assets (land and livestock) are unequally distributed.
Lorenz curve agricultural land, 2014 Lorenz curve livestock ownership, 2014
1
1

.8
.8

.6
.6
.4

.4
.2

.2
0

0 .2 .4 .6 .8 1 0 .2 .4 .6 .8 1

Lorenz (Consumption) Lorenz (Land) Lorenz (Consumption) Lorenz TLU

45 degree line 45 degree line

Source: Authors’ calculations using LSMS-ISA 2014.

2.3 Risks and Vulnerability

30. Risks and shocks play an important role in perpetuating poverty in Niger. The great
droughts of the 1980s were transformative for Niger with the disappearance of forests, and the
pastoralists’ herds from the north were decimated due to the lack of forage production. The last
serious drought in 2010 combined environmental degradation, population displacement, high grain
prices, and poor food access and affected the food security of nearly 40 percent of Niger’s
population.17

17
USAID (United States Agency for International Development). 2014. Climate Change and Conflict in the Sahel:
A Policy Brief on Findings from Niger and Burkina Faso.

13
31. National averages hide a great amount of churning in and out of poverty. From 2011,
which was a drought year, to 2014, 43 percent of people moved out of poverty while 27 percent
fell in poverty. This volatility in poverty incidence follows from the high dependence of the overall
economy on rain-fed agriculture and the inability of the population to insure themselves adequately
against shocks.

32. Price and drought/flood shocks dominate the risk environment. In both the 2011 and
2014 surveys, households report price and drought/flood as the most severe shocks they face.
About 30 percent of households view price shocks as their greatest shocks in 2011. Indeed, prices
of cereals (that is, millet), which constitute the main staple of the population and particularly of
the poor, display large intra-annual variations. As the poor are net buyers of food, with about 60
percent of food consumed purchased on the market, price fluctuations have a direct impact on
welfare.

Figure 2.8: Vulnerability and poverty

While chronic poverty is high, there is also a lot of churning because of weather and price shocks.
Poverty dynamics 2011-2014 Distribution of victims across shocks since 1990
38 99%
40 100%
34 84% Human victims Cattle lost
35
27 80%
30
25
60%
20
15 40%

10
20% 10%
5 5%
0% 0% 1% 0%
0 0%
Chronic poor Transient poor Never poor Drought Animal disease Flooding Locusts

Staple food prices vary significantly within and across years, creating huge vulnerabilities, particularly among
households dependent on food purchases.
Millet prices in selected markets (1994–2016)
350

300

250

200

150

100 Agadez
Commune
Tillaberi
50 Commune
Maradi
Commune
0
1 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7101 4 7102 5 8123 6
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Source: Authors’ calculations using LSMS-ISA 2011 and 2014 and United Nations Office for Disaster Risk Reduction
(UNISDR) 2016. Prices: World Food Programme (WFP) 2016.

33. Exposure to uninsured (weather and price) risks induce risk-mitigating strategies at
the expense of higher yields. In 2014—a ‘normal’ agricultural year—74 percent of households

14
faced shocks of different types and experienced a decrease in revenue; another 73 percent of
households lost some assets. Shocks can lead to food insecurity and malnutrition. As a
consequence of shocks, 75 percent of households reported a decrease in food production. About
35 percent of households decreased their reliance on food purchased on the market and reduced
the quantity of food consumed. Because of the omnipresence of shocks in a context where
households live not far above the survival threshold, farmers opt for relatively safe but low-return
crops, such as millet and sorghum, while limiting their exposure by relying on traditional seed as
opposed to improved or hybrid seeds which have to be purchased (often on credit). Households
who have access to irrigation are less exposed to weather shocks.

34. The prevalence and ranking of self-reported price and weather shocks is consistent
with self-reported views on the causes of poverty. Most households consider themselves
extremely poor. In 2011, 55 percent of the population of Niamey ranked themselves as poor
compared to the measured 10 percent poverty headcount. In the poorest agricultural zones, 75
percent of the population perceive themselves as poor. This figure reaches 78 percent in the rural
pastoral zones. Drought/floods was most frequently mentioned as the main cause of widespread
poverty (33 percent), followed by the lack of employment (28 percent) and the high cost of living
(16 percent).

Figure 2.9: Perceptions of poverty and its causes

Most households view themselves as extremely poor…because of drought, lack of employment, and high living
cost.
Households perceiving themselves as extremely Principal causes of poverty (% of HH, 2011)
poor (%, 2011) 35 33

78 30 28
80 74
70
25
70

55 57 20
60 16

50 15

40 10

4 3 3
30 5 3 3 2 1

20 0

10

0
Niamey Other Urban Agricultural Agro-pastoral Pastoral

Source: Authors’ calculations LSMS-ISA 2011.

Note: HH = Household.

2.4 Poverty Traps

35. Results from the 2011–2014 panel data suggest that 57 percent of poor Nigeriens18 in
2011 could be considered chronically poor and thus potentially in a poverty trap. Households
may end up in a poverty trap because of adverse initial conditions (they ‘inherited’ too few assets
and human capital), in combination with limited options to finance costly assets, or because of

18
That is 27 percent of all Nigeriens.

15
exposure to uninsured shocks. There are various ways in which poverty traps can occur; some of
these, such as the demographic trap, have already been mentioned. 19

36. Asset poverty traps occur when asset holdings are below some critical minimum
needed to withstand a macro, community (drought, flooding, insecurity) or household shock
(illness, death in the family). Such shocks would force affected households to dispose of some of
their assets or to indebt themselves and be pushed into a state of chronic poverty. For instance, a
poor household may lose its seeds and then fail to have the means to purchase new seeds. It may
also happen that households lack the means (animal traction) to bring a sufficiently large area
under cultivation, or they may be indebted and forced to first work on other people’s farms to
repay their obligations before they can tend to their own fields. Asset traps can result from the
death of the head of the household, particularly when productive assets which were previously
shared, such as ploughs or draft animals, are inherited by one survivor. Conflict and forced
displacement have also resulted in asset traps as all productive assets—including land access and
ownership, agricultural tools and inputs, seeds, and animals—are lost in the process of fleeing.
The likelihood that asset traps are prevalent can be inferred from references to increasing
landlessness and the formation of a class of medium-scale farmers who purchase land from
distressed peasants.20 It can also be seen from the fact that the poorest households plant the smallest
areas per capita, have few productive animals and little in productive assets, and are most likely to
have acutely malnourished children (a sign of food shortages).

Figure 2.10: Agricultural inputs and yields

Use of modern inputs is low and the poorest are less productive in farming major cereal crops which they end up
purchasing on the market.
Use of modern inputs (% of HH, 2014) Yields of millet, sorghum and cowpeas (kg/ha)
20 Bottom 20 Top 20
21 700
592
600
507
16 500 446
12
400
10 292
11 9 9 275
300 264 247
229 217

5 5 200 145 139 136 131

6 92 95 109
74 76
100

0 0
1 2011 2014 2011 2014 2011 2014

Fertilizer Seeds/insecticides Animals plow Tractor plow Irrigated Rainfed Agropastoral

-4 Millet Sorghum Cowpeas

Source: Authors’ calculations using LSMS-ISA 2011.

37. Nutrition trap. For poor adults, low nutritional status reduces their ability to engage in
physical activities that are necessary to grow food or raise livestock. This reduces productivity,
translating into lower incomes, leading to poverty and inadequate food consumption, further
lowering their productivity and creating a vicious spiral into a destitute state. Hunger and

19
Presented is an adaptation of a taxonomy by: Thorbecke, Erik. 2013. “The Interrelationship Linking Growth,
Inequality and Poverty in Sub-Saharan Africa.” Journal of African Economies 22 (1): i15-–i48.
20
Abdoulaye, T., and Ibro G. 2006, Analyse des Impacts Socioéconomiques des Investissements dans la Gestion des
Ressources Naturelles: Etude de Cas Dans les Régions de Maradi, Tahoua, Tillabéry au Niger. Centre Régional
d’Enseignement Spécialisé en Agriculture de Niamey et Université Libre d’Amsterdam.

16
malnutrition are widespread before the planting season starts, when food stocks are low and market
prices high. Across rural livelihood zones, 31 percent report not having enough food to feed
themselves. For children, malnutrition during the first few years of life causes irreversible damage
by negatively affecting cognitive development which is important for learning and the building of
human capital. Malnutrition is not only the consequence of inadequacy of the quantity of food but
also about inadequate caring practices, including psychosocial stimulation. This is evidenced by
the fact that most malnutrition occurs during the first 24 months in life, when the quantity of food
needed is limited. It points toward the criticality of behavioral aspects of infant feeding: reliance
on exclusive breastfeeding, introduction of appropriate complementary feeding, use of safe water,
and dietary diversity but also birth spacing.

38. Health trap. Recurrent health issues have the ability to trap the poor in a vicious cycle of
low productivity, low incomes, and poor health, leading to low productivity. Healthy workers are
more likely to engage in productive activities; similarly freed from the need to look after the sick,
caregivers can earn an income. During the four weeks preceding the 2014 survey, 36 percent of
individuals reported a sickness. Fever/malaria is the leading cause of illness, followed by
respiratory infections (often caused by indoor air pollution) and diarrhea. These health problems
prevented 73 percent of those in the poorest quintile from undertaking their normal activities. Yet,
only 39 percent of sick individuals in the poorest quintile sought treatment, as opposed to 66
percent of ill individuals in the richest quintile.

Figure 2.11: Education

Education levels are uniformly low, with the poor having less than 1 year of schooling.
Mean year of schooling (years, 2014) Highest level of education completed (2014)
6 5
Poorest 20% Richest 20%
Q5

Q4
4 3

Q3
3
2

2 Q2
1 1
1 1
0 1
0
1 Q1

0 0% 20% 40% 60% 80% 100%

Niamey Other urban Agricultural Agro-pastoral Pastoral No education Primary Secondary Tertiary

Source: Authors’ calculations using LSMS-ISA 2014.

39. Education trap. Despite the sharp increase in enrollment over the past 20 years, education
levels remain exceptionally low in Niger. About 50 percent of the population ages 15–24 years
cannot read or write. In addition, 72 percent of the population has no formal education. The mean
year of completed schooling is about one year for the poorest quintile in rural areas. Moreover, the
return to education is low for levels below secondary school. Relative to households with no
education, households with primary education do not have higher consumption. However, children
from the poorest quintile struggle to transition to secondary schools, in part due to distance.
Furthermore, households that experience income shocks from drought/floods are 4 percentage
points less likely to have their children attending schools.

17
40. Social- and gender-based traps may result from long-standing cultural values, which
in turn may be a response to coping with a risky environment. Traps are associated with
attaching less value to the education of girls than of boys; the custom of marrying girls young
(particularly in situations of financial distress and preferably to well-to-do (hence older) men from
a different climatic zone); customs prohibiting women from inheriting upon the death of their
husband (leading—in polygamous households—to a competition for children as it justifies a larger
share of the inheritance); or customs separating the economic spheres and responsibilities of
husband and wife. Societal norms and expectations limit the full economic potential of women,
and by implication of society. Thirty-four percent of Nigerien women are out of the labor force as
opposed to 10 percent for men; those working are employed on average for fewer hours than men
(28 versus 43) and receive lower earnings. Few women engage in seasonal labour migration.21
Gender- and social-based traps are rarely purely ‘cultural’ and are often influential, that is, they
serve an economic function. This is the case, for instance, with girls marrying young in exchange
for a dowry. As a consequence, many social and gender traps could gradually become less binding,
as social norms change or as the economic reasons for the practices become less pressing.

Figure 2.12: Differences in main activities between men and women

Men and women have very different activity profiles. Unlike men, women are much more likely not to be in
formal schooling. Men by contrast are much more likely to work or to combine work with schooling.
Main activity, men Main activity, women
100% 100%

80% 80%

60% 60%

40% 40%

20% 20%

0% 0%
5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35

Only work Only work

Work and Formal Schooling Work and Formal Schooling
Only Formal Schooling Only Formal Schooling

Not Employment or Formal Schooling Not Employment or Formal Schooling

Source: World Bank. 2016. Jobs Assessment in Niger.

41. Soil fertility trap. The arenosols on which most agriculture in Niger is practised have a
low natural fertility and low water retention capacity but are permeable and easy to work. These
soils are suitable for low-demand agricultural crops such as millet but they erode easily by wind
and water as soon as the vegetation cover is gone. Soil fertility is typically restored by relying on
fallow, but land pressure because of population increase and low productivity because of soil
degradation reduces fallow periods and thus reinforces declining soil fertility. 22 Reliance on wood

21
World Bank. 2016. Jobs Assessment in Niger.
22
A recent study estimated the cost of land degradation in 2007 due to land-use and land-cover change (LUCC) as
approximately US$0.75 billion, which is 11 percent of the 2007 GDP.

18
fuels (85 percent of energy consumption in Niger is from wood) also contributes to soil
degradation.

42. Conflict can also be a trap. The destruction of property and the loss of life and access to
services that are associated with conflict have already been identified as potential reasons for
poverty traps. However, conflict also damages the social fabric, reduces the scope of informal
safety nets, and limits productive opportunities, leading to further deprivation which in turn can
fuel conflict, for instance when destitute youth feel compelled to join armed groups for economic
gain. Conflict thus generates further conflict, leading to vicious cycles of increasing poverty.

43. Faced with very low incomes and exclusion from financial and insurance markets, a
poor household’s only option to avoid chronic poverty is an autarkic savings strategy to
invest in the necessary assets. This requires substantial medium-term sacrifices in the form of
diminished consumption, which many very poor households cannot afford, as their consumption
levels are already low. Households in chronic poverty are likely to forgo nutrition, health, and
educational investments which will undermine their long-term productivity and further entrap
them. Poor households may also be forced to put their children to work, entrapping them in poverty
in the future when they are grown-ups.23

44. The prevalence of multiple poverty traps implies that successfully attacking poverty
is likely to require a multifaceted strategy. As poverty traps could not occur in the presence of
well-functioning financial markets, financial deepening is an important issue, especially in rural
areas where most of the poor live. As financial markets can be expected to remain incomplete,
other interventions will also be needed to address poverty traps. In locations with more than one
trap, rather than attacking each trap separately to break its vicious cycle, multiple cycles have to
be broken at the same time to create a more virtuous cycle. 24 Single interventions may address
multiple traps at the same time: improved female education can be expected to reduce traps
associated with gender, the lack of assets (human capital), and high levels of fertility. Irrigation
could address nutrition, productive asset, spatial, and soil fertility traps simultaneously by
lengthening the growing season and increasing yield.

2.5 Climate Change

45. There is a great awareness of the rapidly changing climatic phenomena in Niger. Over
the period 2009–2014 most households observed less rainfall (52 percent), worse distribution of
rainfall in the year (62 percent), more frequent droughts (59 percent), shorter rainy seasons (77
percent), and more delays in the start of rainy seasons (66 percent). These perceptions are
homogenous across livelihood zones and between poor and nonpoor households. However, only
13 percent of households have any adaptation strategy with respect to climate change. The
dominant adaptation strategies are diversification to nonfarm activities (26 percent), migration of
family members (23 percent), raising fewer livestock to increase agriculture (23 percent), and

23
This is clearly happening. Some 16 percent of those between ages 5 and 14 combine school and employment. As
working children are employed on average for 27 hours per week and also often contribute to other household
chores, it is likely that work obligations affect their school progression and hence the ability to earn an income in the
future. World Bank. 2016. Jobs Assessment in Niger.
24
Thorbecke, Erik. 2013. “The Interrelationship Linking Growth, Inequality and Poverty in Sub-Saharan Africa.”
Journal of African Economies 22 (1): i15-–i48.

19
changing seed varieties (21 percent). Only 6 percent of households irrigate more intensely as an
adaptation strategy. The nonpoor adapt more through diversification of sources of revenues (30
percent) while the poor adapt by shifting from raising livestock to increasing agricultural
production.
Figure 2.13: Perceptions of climate change, cereal, and livestock production
Households are firmly aware of climate change which is already happening with the strong impact of agriculture.
Climate perceptions (% of HH, 2014) Rainfall and production (%, 2009-13)
Agricultural Agro-pastoral Pastoral
Rainfall Cereal production Livestock production
60
85 80 80 51
75 77
50
72 41
75 69
68 37
64 65 40
62 63 61
65 27
56 57 30
52
55
20
45
10 3 2 1
35
0

25 -10
-10 -9 -8
15 -20
-18 -18
-21
5 -30
-28 -28
-5 Less rainfall Worse distribution more frequent delay in rain season short rainy seasons -40
of rainfall droughts 2009 2010 2011 2012 2013

Source: Authors’ calculations using LSMS-ISA 2011 and WDI.

46. The overall economy is exposed to rainfall variability which will likely be heightened
by future climate change with consequence for poverty reduction. Households dependent on
rain-fed agriculture and livestock rearing for subsistence will continue to face large income
fluctuations originating from climate variability. Exposure to food insecurity, hunger, and
malnutrition will increase. The annual variation in rainfall is highly correlated with cereal
production. During the last drought of 2011, a 21 percent decline in rainfall led to 28 percent
decline in cereal production and 8 percent reduction in the stock of animals.

47. Levels and timing of rainfalls are important for households’ poverty. There is a strong
relationship between households’ poverty and the amount of rainfall and the timing of rainfall
across livelihood zones. Levels of rainfall above the historical mean are associated with lower
levels of poverty. In 2014, poverty among households that received above-average rainfall was 39
percent compared to 47 percent for households receiving below-average rainfall. Poverty among
households that receive rainfall late in the planting season was 52 percent compared to 42 percent
for those households that received rainfall just in time. While poverty is high in the southern
agricultural zones (56 percent), poverty is 4 percentage points lower in areas that practice irrigated
farming. Small-scale irrigation and weather insurance provide one potential solution to minimize
weather risk to production and therefore reduce poverty.

20
Box 2.1: Determinants of poverty decline
Identifying the determinants of poverty decline is hindered by the absence of detailed survey information on sources
of income for households. Such information was only collected in 2011 and 2014. As a consequence, explaining
the poverty trend can only use data spanning a relatively short period, making it hard to differentiate signal (policy
actions) from noise (weather events). This is particularly pressing as rainfall is a core determinant of productivity
in agriculture. This is immediately evident when considering information on poverty incidence in Figure 2.4, which
shows large changes in poverty (going in both directions) across different regions. Since all regions operate in the
same policy environment, changes in poverty need to be driven by local factors. Weather is the main one.
On average, the proportion of individuals living on less than CFAF 518 per day (the poverty line) fell by 1.2
percentage points per year since 2011. This pace was faster than the rate of progress in earlier years between 2005
and 2011 when annual poverty reduction was 0.9 percentage points. Poverty reduction among households engaged
in rural areas was driven by higher levels of rainfall—up by 30 percent higher between 2011 and 2014. As a
consequence, yields of the three major food crops (millet, sorghum, and cowpeas) were at least 1.5 times higher in
2014. As agricultural production increased, crop sales as a share of agricultural income also grew from 25 percent
in 2011 to 51 percent in 2014. The increase in crops sales led to declining food prices, which was advantageous for
net food buyers in rural areas.
Annual variation in rainfall is strongly correlated with Owing to good rains, millet yields in 2014 were
annual cereal production. higher than in 2011, driving poverty reduction.
Annual variation in rainfall and cereal production (%) Millet yield/ ha
80
700
592
60 600 507
40 500 446
20 400
292 275 264
0 300
-20 200
-40 100
-60 0
2011 2014 2011 2014 2011 2014
Irrigated Rainfed Agropastoral
Rainfall Cereal production

Which led to much higher production. And despite a slight decline in price, led to a much
higher value of total production.
Production of millet in '000 of tons Value of millet production in billion CFAF
900 835
140 122
800 2011 2014 2011 2014
120
700
600 100 81
482
500 80 55
381 384
400 60 46 54
264
300 40
164 0 9 18 6
200 64 33 5
1 20 0 3
100 3 28 29
-
-

Agricultural output growth was driven by rainfall and not by technology adoption or changes in the nature of
production. Compared to 2011, only a few more households used modern equipment (32 percent vs. 35 percent),
inorganic fertilizer (20 percent vs. 24 percent), and pesticides (7 percent vs. 8 percent) in 2014. However, the
proportion of households benefitting from agricultural extension services grew from 13 percent in 2011 to 27
percent in 2014. With low levels of inputs use, good luck (favorable weather) was the most significant contributor
to rural agriculture income growth and the subsequent poverty reduction.

21
Urban poverty fell by more than 2 percentage points per year since 2011. In 2011, Niamey and other urban
areas had 10 and 22 percent poverty incidence, respectively, which declined by 5 and 10 percent, respectively,
in 2014. As a result, the number of urban poor declined from 511,000 to 260,000 people. There are two
explanations for this decline. First, there is the decline in food prices (millet, sorghum, and maize) following
the relatively good harvest of 2014. Even more than rural households, urban households are net food buyers, so
they benefit from lower food prices. In addition, and on the back of increasing rural incomes and expansionary
government spending on investment projects, wage income as a share of total income increased from 46
percent to 54 percent. This too contributed to urban poverty reduction.

22
3. Human Capital
3.1 Introduction

48. Offering quality education and health services to all Nigeriens is a major challenge.
Niger falls into the category of low human development, ranking last but one out of 188 countries
on the 2016 Human Development Index. Niger’s levels of education are very low (1.4 years on
average), rates of malnutrition elevated (44 percent of under-five-year-olds are stunted) and
vaccination and health service use rates are low. Seventy-two percent of children and 46 percent
of pregnant women are anemic. Only 52 percent of the Nigerien children under the age of 24
months have received a complete set of vaccinations. Maternal mortality rates are high: 630 per
100,000 live births compared to 506 for Sub-Saharan African and only 15 percent of births are
attended by a skilled health professional.

49. Investments in human capital are needed as the capacity to work is one of the main
productive assets of poor people. For the poorest who lack physical assets, the health of 15–49-
year-olds in the household is of particular significance. In those parts of the economy where the
main pathways out of poverty are productivity increases in agriculture and out-migration,
investments in health and basic competencies are needed to break the vicious cycle of poverty and
poor quality of life that may otherwise persist.25 To serve the needs of a modernizing economy, it
is equally critical that citizens are equipped with skills to contribute to the structural transformation
necessary to achieve higher levels of income. Finally, being healthy and educated empowers
citizens and decreases dependency on principals for mere survival. It opens opportunities to hold
leaders to account and demand good governance.

Figure 3.1: Niger does not yet realize its migration potential
Despite a symbiosis with the economy of Nigeria and Nigeria being the most important source of remittances,
remittances from Nigeria are relatively small (0.6% of GDP), suggesting scope for growth particularly when the
human capital base of Nigeriens improves.
50
2 44
2 Bilateral remittances from Nigeria (% of GDP) Percentage of total remittances received from Nigeria
45
40
2
1 35 31

1 30
1
25 22
1
0 0 18
1 20
0 13
15
9
0 10
0 0 4 3 3
0 0 0 0 0 5 1 1 1
0 0 0 0
0 0

Source: World Bank Migration and Remittances data, April 2016.

25
See for instance Barro and Lee 2010; Krueger and Lindahl 2000; Gyimah-Bremponga and Wilson 2004; Becker et
al. 1994. The direct relation between education and agricultural productivity is more tenuous among the poorest
countries (Reimers and Klasen 2013), but there are reasons to believe that education will have a positive impact on
agricultural growth. Education through extension services is important for improving farming techniques. Generally,
better education would matter also for managing the business of running a farm.

23
 Figure 3.2: Progress in human capital outcomes
In the last 20 years, Niger has made significant Despite the significant decrease in child mortality, Niger
progress in reducing under-five mortality. lags behind other countries in the region.
Neonatal and Child mortality per 1,000 live births 2015 Child mortality per 1,000 live births
318
114
274
95 92
88
78
198
61 59
49 47
127

Mali Niger Côte Burkina Togo Ghana Ethiopia Kenya Senegal

d'Ivoire Faso
EDSN I 1992 EDSN II 1998 EDSN III 2006 EDSN IV 2012

Progress was made in all regions... …and across all wealth quintiles.
Under-five mortality by region Under-five mortality by wealth quintile

450 400
391 355 348
400 374
356
343
336 350 315
350 318
303
274 285 283 274 282
300 300
247 254
238 231 240 245
250 215 204 232
198 190 193 250
166 168 198 206
200 157
147 184
135 146
127 132 200 168 168 164
150 157
80 144
100 150 127
114
50
100
0
50

0
Niger Poorest 2nd 3rd 4th Wealthiest

1992 1998 2006 2012 1998 2006 2012

Similar patterns are observed for other indicators like school attendance and literacy.

School attendance and literacy by region School attendance and literacy by wealth quintile

90 84 90
77
80 74 80
67
70 70
55
60 54 5456 55 53 60
50 49
49 47 48 44
50 40 41
50 41 42 37 37 37
37 40 34
35 34 35 31
40 33 26 28
28 30 29 30
30 22
20 1214 10
20 1214 7
911 10 69 811 911 1110 10 44 3 5 55
6
10
0
0
4th

4th
3rd

3rd
Niger

2nd

Niger

2nd

Wealthiest
Wealthiest
Poorest

Poorest
Zinder

Zinder
Niger

Niger
Dosso

Dosso

Tahoua
Tahoua
Maradi

Maradi
Agadez

Agadez
Niamey

Diffa

Niamey

Diffa
Tillabéri

Tillabéri

Net primary school attendance Literacy of women aged 15-49 Net primary school attendance Literacy of women aged 15-49

2006 2012 2006 2012

Source: Demographic and Health Surveys (DHSs), various years and WDI 2015.

50. Human capital outcomes were worse two decades ago. Between 1992 and 2012, net
primary school enrollment rates rose from 18 percent to 70 percent, a gain of 3 percentage points
per year. Infant mortality dropped from 318 per 1,000 live births in 1992 to 127 two decades later.
The lethality of malaria receded from 1.8 per 1,000 cases to 1.0 between 2006 and 2012, a

24
reduction that can partly be attributed to a tripling in the use of insecticide-treated nets to around
20 percent. Progress in human capital development is broadly shared, even though large
differences persist between regions, by wealth category and by gender. Urban centers, particularly
Niamey, exhibit the best human development outcomes. For instance, in Niamey, 34 percent of
the population has no education; in Tahoua, 82 percent has no education.26

51. Not in all respects was progress made. Maternal mortality—an indicator of the ability of
the health system to deliver complex services—declined only slightly from 652 deaths per 100,000
live births in 1992 to 630 in 2014. Also, malnutrition rates have remained stubbornly high. Poor
maternal and child health are reflected in low utilization of services and poor adoption of protective
health behaviors. For example, skilled attendance at delivery is only 29 percent and bed net use
only 20 percent, putting women, newborns, and children at risk for poor health and nutrition
outcomes.

3.2 Health

52. With 7.3 children per woman, Niger has the highest fertility rate in the world. In 2012,
only 12 percent of women in Niger used modern contraceptive methods—very low by global
standards. High fertility not only increases the risks to maternal and child health and nutrition but
also increases child dependency ratios and exacerbates poverty and food insecurity. As death rates
have progressively declined over several decades while fertility has remained relatively unchanged
(Figure E.2), population growth has increased to 3.9 percent per year. Age-specific fertility rates
show an extremely high adolescent fertility rate: 204.8 births to adolescent mothers ages 15–19
years, twice as high as the Sub-Saharan Africa average of 110. Sixty-one percent of girls between
the ages of 15 and 19 are married and 40 percent of 15–19-year-old girls already mothers or
pregnant with the first child. These figures reflect sociocultural norms encouraging early marriage
and childbearing, limited educational opportunities beyond primary education, and low levels of
contraceptive use.

53. High levels of fertility largely reflect wanted fertility. Unlike anywhere else in the world,
in Niger, the desire for an additional child hardly declines with the number of children. So, not
only is fertility high, high fertility is wanted. Niger thus appears to be exceptional; yet, most
established correlates of fertility decline remain valid in Niger (the exception being the fact that
fertility has not declined despite large declines in child mortality). For instance, there is variation
in fertility between women of different wealth quintiles, but only women in the highest quintile
have lower fertility (Figure 3.3 ). It suggests scope to reducing fertility through income growth,
except for the fact that for the poorer households income growth would have to be substantial
before fertility starts to decline. Living in an urban area is also associated with lower fertility, and
correlates positively with known determinants of lower fertility: higher levels of education, access
to information and access to health services. Niger’s exceptionally high fertility can thus largely
be explained by the fact that most earn very low incomes, have very little education and limited
access to information and limited access to health services. Without improvements in these
conditions, population growth is likely to remain high, and the impact of population policies
limited.

26
INS (Institut National de la Statistique). 2012. Enquête Démographique et de Santé et à Indicateurs Multiples.

25
 Figure 3.3: Fertility rates and child survival
Unlike elsewhere in Sub-Saharan Africa, fertility rates are not declining. This is despite the fact that the child
survival rate has increased substantially from 76 percent to almost 90 percent.
Fertility rates Child survival

9 8 7 95%
7
7 89% 89%
8 7 7 88% 6
87% 90%
5 5
7 6 5
5
85%
6 5 4 81%
6 84%
3
5 4 3 76% 80%

4 4 3
2 75%
1
3 2
0 0 70%
2 1

1 0 65%
15-19 years20-24 years25-29 years30-34 years35-39 years40-44 years45-49 years
0
1970 1980 1990 2000 2010
Niger Sub-Saharan Africa kids born kids survived survival rate

Source: UN Population Division, World Population Prospects 2015 Revision, and the National Survey of
Socioeconomic and Demographic Indicators (Etude Nationale d’Evaluation d’Indicateurs Socio-Economiques et
Démographiques, ENISED) 2015 survey.

54. Chronic food insecurity and infectious diseases have resulted in some of the highest
rates of malnutrition and mortality in the world. Stunting is the result of chronic malnutrition,
triggered by a continual insufficient caloric intake or by recurring infections that prevent the
absorption of nutrients and expand nutritional needs. By 2012, the prevalence of stunting was 44
percent, compared to 38.3 percent in Mali and 18.7 in Senegal. Stunting is strongly associated with
exclusive breastfeeding, which is very low in Niger—only 23 percent. The prevalence of wasting,
which indicates acute undernourishment, was 18 percent.27 At this level, acute malnutrition
exceeds the WFP’s threshold for emergencies. The highest prevalence is observed in the Maradi
region (16 percent) and in Niamey, where the levels are very high (13 percent). There is a strong
seasonal aspect to food insecurity and levels of malnutrition are especially high during the
‘soudure’, the period when food stores are depleted and the new crop not yet ready for harvesting.
It lasts from June to October and coincides with the rainy season when the incidence of diarrheal
disease and malaria are most elevated. High rates of malnutrition are also associated with higher
susceptibility and severity of illness, putting a substantial number of children at higher risk for
contracting and suffering from illnesses.

55. A lack of medical personnel negatively affects the health system’s performance. Niger
has the lowest nurse to population ratio of all comparator regional countries and half the minimum
number of nurses recommended by the World Health Organization (WHO) (1 per 5,000 people).
In 2009, 0.1 nurses were registered per 1,000 people, five to six times less than in Côte d’Ivoire
and Burkina Faso. The lack of trained personnel is aggravated by an uneven spatial distribution of
staff placement. In 2010, in Dosso for instance, one nurse served 7,786 people while in Niamey
one nurse served 3,385. The density of doctors in Niamey is 17 times greater than in Tillaberi and
13 times greater than in Dosso. The personnel challenge is compounded by very high absence

27
WFP (World Food Programme). 2015. Avis sur les perspectives agricoles et alimentaires 2015-2016 au Sahel et
en Afrique de l’Ouest. http://documents.wfp.org/stellent/groups/public/documents/ena/wfp277905.pdf.

26
rates: 53 percent nationally, low drug availability (around 40 percent for tracer drugs) and a limited
ability to correctly diagnose a patient.28

Table 3.1: Summary of indicators on health and education in Niger

Indicator (following lifecycle logic) Value Unit Year Source
Maternal and reproductive health
per 10,000
Maternal mortality 630 2012 DHS
live births
per woman
Total fertility rate 7.3 2015 ENISD
ages 15–49
Women, ages 15–49, who took basic prenatal health tests 83 % 2012 MICS4
Women, ages 15–49, who had qualified assistance during childbirth 29 % 2012 MICS4
Women giving birth in a qualified health facility 30 % 2012 MICS4
Contraceptive prevalence rate (modern methods) 12 % 2012 DHS
Child mortality and child health
Per 1,000
Under-5 mortality 127 2012 MICS4
live births
Per 1,000
Infant mortality 51 2012 DHS
live births
Under-5 stunting (low height for age): Moderate to severe 43.9 % 2012 DHS
Severe 21.6 % 2012 DHS
Under-5 underweight (low weight for age): Moderate to severe 36.4 % 2012 DHS
Severe 13.3 % 2012 DHS
Under-5 wasting (low weight for height): Moderate to severe 18 % 2012 DHS
Severe 6.2 % 2012 DHS
Under-2 full vaccination coverage 52 % 2012 DHS
Under-5 who slept under an insecticide-infused mosquito net 20 % 2012 MICS4
Under-6 months on exclusive breastfeeding 23 % 2012 DHS
Under-5 diarrhea 19.4 % 2012 DHS
Basic education
Preschool enrollment of 3–5-year-olds 7.1 % 2014 WDI
Gross primary school enrollment 70.6 % 2014 WDI
Net primary school enrollment 61 % 2014 WDI
Gross secondary school enrollment 18.8 % 2014 WDI
Net secondary school enrollment 15.7 % 2014 WDI
Gender parity at primary school level 0.84 Girls’ net 2012 MICS4
enrollment/
Gender parity at secondary school level 0.69 boys’ net 2012 MICS4
enrollment
Education and skills of adults
Years of schooling of women ages 15–49 0.83 Years 2014 HDI
Years of schooling of men ages 15–49 2 Years 2014 HDI
Women, ages 15–49, who can read and write a short simple phrase
8.90 % 2012 WDI
in French or English
Men, ages 15–49, who can read and write a short simple phrase in
23.20 % 2012 WDI
French or English
Source: DHS 2012, ENSD 2015, WDI 2015.
Note: ENISD = Niger’s Demographic and Health Survey with Multiple Indicators (ENISD l'Enquête Nationale
d'Evaluation des Indicateurs Socioéconomiques et de Démographie; MICS = Multiple Indicator Cluster Survey ;
ENSD l'Enquête Nationale d'Evaluation des Indicateurs Socioéconomiques et de Démographie.

28
World Bank. 2016. Service Delivery Indicator Survey.

27
56. Low population density, a harsh climate, and poor road infrastructure makes it a
challenge to access medical services. Walking long distances to seek treatment is not unusual.
During the rainy season, flooding makes health facilities even less accessible. While during the
dry season 39 percent of the population lives within a 1-hour walk of a health center, this drops to
24 percent during the rainy season. Vaccination rates are strongly correlated with distance.
Children living within a 1-hour distance from a health center are 1.9 times more likely to have a
complete set of vaccinations compared to children living further away. 29 Access to health care is
impeded not only by inadequate infrastructure and personnel but also by cultural attitudes. For
example, the most recent DHS shows that getting permission to go for treatment is listed as a
barrier to accessing health care by high proportions of women in Agadez (44 percent), Maradi (40
percent), and Niamey (30 percent).

57. Preventable diseases such as malaria and bronchitis are prevalent and often fatal. In
addition, infectious diseases such as cholera, meningitis, and trachoma remain major public health
threats. Measles, meningitis, polio, and pneumonia are prevalent during the dry season (generally
between October and March) while cholera (June to September) and malaria (August to
September) are highest during the wet season.

58. Lack of sanitation, limited water treatment, and poor diets facilitate the spread of
disease. Only 11 percent of the households have access to ameliorated toilets and over 70 percent
practice open defecation—one of the highest rates in the world. While 58 percent of the population
has access to improved sources of water, important disparities can be found between urban areas,
where access to improved water is nearly universal and rural areas where less than half of the
population has an improved access.30 The combination of both with low water treatment (83
percent of households do not use an appropriate means to treat water) explains why one in five
children suffered from acute and prolonged diarrhea in the three years preceding the MICS4
survey. While the disease is on the decline, diarrhea instances are only now reaching the levels
other Sub-Saharan Africa countries already attained in the 1990s. Infectious diseases are both a
cause and a consequence of the lack of a nutritional diet, as an immune system weak from
inadequate nutrition is more disease prone and a sick person has higher caloric needs.

59. Quality of care is poor, with untimely and inappropriate care being provided to
clients. According to the 2012 DHS, among children with diarrhea and acute respiratory
infections, only 43 percent and 53 percent, respectively, received appropriate care. Only 35 percent
of pregnant women received the two recommended doses of drugs for the Intermittent Preventive
Treatment of Malaria. Use of health services is limited among adolescents: 16.4 percent of
pregnant adolescents, ages 15–19, do not receive any antenatal care, two-thirds deliver at home
with no assistance, and only 7 percent use contraception. A quality survey conducted in 2013 by
the Ministry of Health (MOH) also reported inadequate providers’ practices and behaviors toward
women and adolescent health, including lack of privacy, inconsistency of clinical practices, staff
absenteeism, and lack of adolescent-friendly approaches.

29
Blanford, J., Supriya Kumar, Wei Luo and Alan M MacEachren 2012. “It’s a Long, Long Walk: Accessibility to
Hospitals, Maternity and Integrated Health Centers in Niger.” International Journal of Health Geographics 11: 24.
30
Forty-nine percent in 2015, according to the WHO/UNICEF Joint Monitoring Program: www.wssinfo.org.

28
 Figure 3.4: Niger’s health indicators in relation to comparator countries
Preventable infectious diseases are rampant… …and immunization levels very low.
Deaths from Infectious Diseases Children under-2 having received full set of vaccines
861 81
70
740 66
681 63 64
657 648
588 587 51
558 50
47
476
34
30
27

Côte Niger Togo Kenya Burkina Mali Senegal Ethiopia Ghana

d'Ivoire Faso
Deaths from infectious diseases (deaths/100,000)

The maternal mortality rate declines but remains high …and sanitation standards are low.
Maternal Mortality Rate % of children (0-16) living in a household with a flush or pit toilet latrine
1600 87 89 91
79 80 82
1400 73
67
1200
55
51
1000

800
873 828 794
600 723
657 18
400 553

200

0
1990 1995 2000 2005 2010 2015
Niger Burkina Faso Mali Chad

Niger has few physicians and nurses.

45

40 Physicians Nurses
Physicians per 100,000 population

35 180
Nurses per 100,000 population

30 160
140
25
120
20
100
15 80
60
10
40
5 2 14
20
0 0

Source: INS 2015; WHO 2012 and 2015; DHS 2012; Human Opportunity Index 2014.

60. Financing for the health sector is a major challenge, underlying many of the supply-
and demand-side barriers. Niger’s health sector suffers from chronic underfunding. Only 2.4
percent of Niger’s GDP is allocated to the health sector. Given the reliance on out-of-pocket
expenditures as the main source of health financing, the cost and unaffordability of health services
remain the leading barriers for poor people. Annual per capita health spending is US$8, which is
far below global health care financing benchmarks. Due to declining donor contributions,
government expenditures on health declined significantly between 2008 and 2010, from US$92.9
million to US$49.6 million), which represents a decline of 47 percent during this period. Between
2010 and 2011, health expenditures increased to US$67.9 million, which is a significant
improvement but still less than the amount in 2008. As a share of total government expenditure,
health expenditures have also fallen, declining from 12.4 percent in 2008 to 7.1 percent in 2011.

29
The total contribution of health expenditures of bilateral and multilateral agencies, including
NGOs, also dropped drastically from 33.5 percent in 2005–2006 to 20 percent in 2009. Spending
on goods and services declined by 11 percent, and spending on transfers and subsidies fell by 3.6
percent, while personnel costs increased drastically after 2011. Capital expenditures continued to
decline, representing only 8.4 percent of total public expenditure in the sector.

3.3 Education

61. Levels of education are extremely low. With 1.4 years of education on average, the level
of education of Nigeriens is among the lowest in the world. Sixteen percent of the adult population
has completed primary education and only 2.1 percent has completed secondary. Literacy rates are
concomitantly low—14 percent of women and 42 percent of men are literate (2012 data)—as is
the availability of skills in the economy. Limited access to information further compounds the lack
of education of the population. Internet access is a rarity and the majority of the population does
not even have access to mass media; only 40 percent of the population listens to the radio at least
once a week (Figure 3.5).

Figure 3.5: Levels of education for adults (2012) and access to mass media
Levels of education are extremely low: the median adult Access to information is also very limited. The
has no education at all and only slightly more than 2 majority of the population does not have access to
percent of the population completed secondary education. any form of mass media.
Levels of education (%) Access to mass media

100 0 70
2
7
90 1 59
16 60
9
52
80 2
50
70 42
17
40 36
60

50 30
20
40 80
20 14
30 59
10 5
2 3
20 1
0
10 Read a Watch television Listen to the Access to No access to
newspaper at at least once a radio at least newspaper, mass media
0 least once a week week once a week television and
Women No education Men radio at least
Some primary education once a week
Completed primary education
Some secondary education
Women Men
Completed secondary education
More than secondary education

Source: DHS 2012.

62. There are major differences in school attendance between rural and urban areas. In
urban centers, schooling is the main focus for the majority of children up to age 15. Nearly 85
percent of 8-year-old children go to formal schools, while 7 percent combine school with work.
Overall, only a minority of youth in urban areas works and studies at the same time; young urban
Nigeriens focus mainly on school in the early years and by age 29 virtually all Nigeriens in urban
centers either work (64 percent) or are out of both the labor force and formal education (33
percent). Those who remain in school after age 25 pursue higher education.

63. In rural areas, by contrast, only a minority of children of school age are in formal
education. Only a small fraction of youth in rural areas exclusively attends school and most
exclusively work or combine education with work. The age cohorts most exposed to formal

30
schooling are the 8- and 9-years-olds: among the 8-year-olds, only 27 percent attend formal
schools and 17 percent combine schooling with work; among the 9-year-olds, only 26 percent
focus on formal schooling and 22 percent combine formal education with employment. After age
16, almost no Nigerien in rural areas is exclusively focused on studying: the small numbers of
youth who continue with their studies do so by combining education with work. The education
levels attended by youth in rural areas are almost never higher than primary (up to age 16) or the
first cycle of secondary (between ages 16 and 24).

Figure 3.6: Education attendance and main activities in rural and urban areas
School attendance in urban areas is high, unlike in rural areas.
School attendance, urban School attendance, rural
100%
90%
90%
80%
80%
70%
70%
60%
60%
50%
50%
40%
40%
30% 30%
20% 20%
10% 10%
0% 0%
12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
Primary Primary
Secondary first cycle Secondary first cycle
Secondary second cycle+ Secondary second cycle+
In urban areas, young Nigeriens focus on education; in rural areas they mostly work or combine work with
schooling.
Main activity, urban Main activity, rural
100% 100%
90% 90%
80% 80%
70% 70%
60% 60%
50% 50%
40% 40%
30% 30%
20% 20%
10% 10%
0% 0%
5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35

Only work Only work

Work and Formal Schooling Work and Formal Schooling
Only Formal Schooling Only Formal Schooling
Not Employment or Formal Schooling Not Employment or Formal Schooling

Source: World Bank. 2016. Jobs Assessment in Niger.

64. To address low levels of education, major investments are being made, but universal
primary education is far from achieved. In 2011, public spending on education was 3.2 percent

31
of GDP, 23 percent of total public expenditure, placing Niger above the median of other countries
in the region. The greater part of Niger’s education budget goes to primary education. In 2010, 60
percent went to primary education, 25 percent to secondary education, and 12 percent to tertiary
education. Nonformal education received the remaining 3 percent. Still, enrollment is far from
complete. The net enrollment rate in primary education is 63 percent; 22 percent in lower
secondary education and around 7 percent attending upper secondary, the lowest rates of all the
comparator countries in the region.

Figure 3.7: Education enrollment and quality

The school enrollment rate in Niger is one of the lowest in the region for all education levels.
Net primary school enrollme nt (% ) Net lower secondary school enrollment (%)
90 90
87 85
81
73
66 67 68 68
61 62
59

38 39
35

21

Côte Niger Burkina Ethiopia Mali Senegal Kenya Ghana Togo Niger Burkina Ethiopia Senegal Mali Togo Ghana Kenya
d'Ivoire Faso Faso
Primary school enrollment Lower secondary school enrollment

As a result, those who have basic reading and writing skills represent lesser than 20 percent of the population.
Net upper secondary school enrollme nt (%) Adult literacy rate (% of pop. aged 15+)
43 76 77
42
35 66
31 57
27 49
43
36 38
16
11 19
6 7

Niger Ethiopia Burkina Senegal Mali Côte Togo Ghana Kenya Niger Burkina Mali Côte Ethiopia Senegal Togo Ghana Kenya
Faso d'Ivoire Faso d'Ivoire
Upper secondary school enrollment Adult literacy rate

Less than one in ten Nigerien students receive passing …and the educational system does not manage to
scores in French in early primary… reverse this trend, which worsens by late primary.
Early primary, % of students achieving sufficient Late primary, % of students achieving sufficient
competency scores competency scores
100 100
90 90 % of students achieving sufficient scores
80 80
70 70
60 60
50 50
40 40
30 30
20 20
10 10
0 0
Niger

Togo

Niger

Togo

Niger

Togo

Niger

Togo
Chad

Burkina Faso

Chad

Burkina Faso

Chad

Burkina Faso

Chad

Burkina Faso
Cameroon
Cameroon

Congo
Burundi

Cameroon

Congo
Burundi

Congo

Cameroon

Burundi

Congo

Burundi
Benin

Benin

Benin

Benin
Senegal

Senegal

Senegal

Senegal
Côte d’Ivoire

Côte d’Ivoire

Côte d’Ivoire

Côte d’Ivoire

Early Primary - Language Early Primary -Math Late Primary - Language Late Primary - Math

Source: United Nations Educational Scientific and Cultural Organization (UNESCO) 2014; Program Analysis of the
CONFEMEN Education Systems (Programme d’Analyse des Systèmes Educatifs de la CONFEMEN, PASEC) 2014.

32
 Figure 3.8: Regional inequalities in education
A child in Niamey is twice as likely to attend primary The percentage of population with no education in the
school than a child in Diffa. capital is less than half compared to the other regions.
Gross enrollme nt rate in primary education % of the population that has not completed primary school

113 91 91 89 92 92 89
2010
80
73
66 66
86 61 62
80 57 58
75 55
73 71
68
59
28

Agadez Diffa Dosso Maradi Tahoua Tillaberi Zinder Niamey

% of the population with no schooling

Agadez Diffa Dosso Niamey Zinder Tahoua Tillabéri Maradi % of the population that has not completed primary school

Dropout rates are very high in all the provinces While Diffa has a low pupil-teacher ratio, the education
except for the capital and Maradi. outcomes remain poor.
Repetition and Dropout Rates, 2009 Pupil-teacher ratio in primary education, 2010
2009 Repetition rate primary 2009 Dropout rates primary
21 46
20 42 42
19 19
19
18
36 36 36
34
15
14

11 25

5
3 4 4
3 3

Agadez Diffa Dosso Niamey Zinder Tahoua Tillaberi Maradi

Agadez Diffa Dosso Niamey Zinder Tahoua Tillabéri Maradi

Source: DHS 2012.

65. There are very large differences in education outcomes between rural and urban
areas, between those from low- and high-income families, and by gender. According to the
2014 Gender Inequality Index, the mean years of schooling for a girl are 0.83 years compared to
two years of schooling for a boy. A girl who is currently six years old can expect to complete 4.8
years of education, while her male classmates can expect to complete 6.1 years of schooling.

66. The quality and efficiency of the primary education system are low. According to the
2014 PASEC survey, only 8.5 percent of the students achieve passing scores in French and 7.7 in
math. The State Report of the Nigerian Educational System (Rapport d’Etat du Système Educatif
Nigérien, RESEN) 2010 estimates the retention rate for primary education at 66.8 percent,31
implying that only about seven out of ten children entering primary education complete it. A high
number of repeaters and dropouts thus leads to a significant waste of resources. The RESEN (2010)
calculates an efficiency of 78.8 percent, which means that 21.2 percent of resources are wasted.

31
RESEN uses the pseudo-longitudinal method to evaluate the progress of a given school cohort through the
education system by reconstructing (hypothetical) a flow diagram of a cohort retention in the system. It compares
the actual non-repeaters in a given class at time t to the number of non-repeaters in the previous class at time t-1.

33
At the same time, unit costs for primary education in Niger are relatively high (21 percent of GDP
per capita in 2010), which further reduces the effectiveness of the education system.

67. Secondary education is also characterized by low access and efficiency. With a
retention rate of 33.7 percent in the lower secondary education cycle, the ability to produce
secondary education graduates is limited. For students completing lower secondary education and
enrolling in upper secondary education, chances of graduating are significantly higher with
retention rates of 73.4 percent in 2010. Because of high repetition rates for lower secondary
education, the efficiency of this cycle is low. The RESEN (2010) calculates an efficiency index of
49.5 percent for lower secondary education in 2009 and 73.3 percent for upper secondary
education.

68. Low quality and efficiency in education has many causes, many of which are rooted
in inadequate management of the sector. Access to learning materials and textbooks is a
problem. Almost 20 percent of the primary schools have no access to textbooks, and 30 percent
lack access to mathematics textbooks. There is also high variation in the availability and quality
of learning materials across schools, suggesting that the issue of textbook availability is not only
about overall availability but also about inequitable distribution. Quality of education is also
affected by uneven distribution of teachers across schools and limited teaching time. There is a
large variation in pupil-teacher ratios. The average number of pupils per teacher was 39 in 2011,
but the large variation means that many schools are well above this average. Furthermore, the
quantity of schooling time is challenged by high rates of absenteeism among teachers, which is
more than 18 days during a school year for almost a third of the teachers (RESEN 2010). The latter
two issues point to the need for more efficient teacher deployment and stronger accountability of
teachers to schools and communities. Adding to the shortage of textbooks and teachers in many
schools, the majority of primary schools also lack basic amenities such as sanitary facilities,
portable water, and electricity. This further reduces the quality and equity of education. The quality
of education is further brought down by poor teaching methods. The current curriculum puts much
emphasis on content and rote learning instead of on skills acquisition by focusing on reading,
mathematics, and problem solving. This is exacerbated by the limited subject knowledge of many
teachers (in particular contractual teachers) and their lack of competency in teaching methods.

69. Low quality of education translates in low returns, particularly in rural areas.
Examining the effect of education on per capita consumption by place of residence, it is evident
that the returns to schooling are low. Urban residents who completed primary education have a per
capita consumption that is 12.9 percent higher than those who have no education. In rural areas
the difference is only 5 percent and only significant for those living in the agro-pastoral zone.
Benefits of education are much higher for those with secondary education (23 percent) or higher
(64 percent) but the fraction of the population that meets these criteria is extremely small.

34
 Figure 3.9: Difference in per capita consumption relative to households with heads who have no education
(only significant results are presented)

70%
64%
61%
60%
60%

51%
50%

40%

30%
23%

20% 16%
13% 12%
11%
10% 7%
5%

0%
Urban Rural Agricultural Agro-Pastoral Pastoral

Primary Secondary Tertiary

Source: World Bank staff estimates using the LSMS-ISA survey 2014.

70. Lack of efficiency is symptomatic of Niger’s inadequate institutional capacity and the
absence of incentives to perform. As illustrated by the lack of efficiency in the allocation and
use of human resources, the administration has a limited capacity for personnel planning and
management, supervision of teachers, and monitoring and evaluation. Roles, functions, and
responsibilities are not very well balanced among the central, regional, and local levels and the
education sector lacks high-level managerial and technical capacity to provide strategic and
operational guidance. Very few incentives are in place to motivate employees and the composition
of human resources in the sector and the deployment of skills at different sector levels need to be
improved to enhance efficiency. Finally, there is a serious lack of physical resources, ranging from
buildings and facilities to furniture, office equipment, and communications equipment.

35
4. Economy and Opportunities for Growth
4.1 Introduction

71. Niger’s economy is reliant on primary commodities and aid, making the economy
dependent on the vagaries of the weather (Figure 4.1), changes in raw material prices, and
donor sentiment. Strong growth supported by agriculture in the 1960s was followed by economic
decline as a result of several years of drought in the early 1970s and the oil crisis. Growth resumed
led by an expansion of uranium exports until its prices collapsed in the early 1980s. In combination
with another severe drought, it led to yet another period of economic decline which went hand in
hand with political instability, a banking crisis, and followed by a sharp devaluation of the currency
in 1994. The past 15 years were marked by relatively strong and less volatile growth aided by
favorable commodity prices, more favorable rains, increases in public investment, and high levels
of aid. Still, per capita income in 2014 was at about the same levels as 25 years earlier in 1990 and
almost 30 percent lower than in 1960. Between 2007 and 2016, donors contributed 8 percent to
GDP (in 2015, even 11 percent) and financed about 33 percent of the country’s budget.

Figure 4.1: GDP growth and rainfall

Niger’s economy has been characterized by booms and After a long period of gradual decline, per capita
busts, due largely to the fact that the economy is not incomes have stabilized and are on the increase,
diversified and reliant on rainfall and the price of owing to a period of relatively good rainfall and
uranium. political stability.
200 15 600
Rainfall and GDP growth Income per capita (constant 2005 dollar)
150
10
500
GDP per capita (2005 coconstant dollar)

100
5
Difference in rainfall (mm)

50 400
GDP growth rate

0 0
300
-50 -5
200
-100
-10
-150
100
-15
-200

Rainfall GDP growth 0

-250 -20
2002
1960
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000

2004
2006
2008
2010
2012
2014
Poly. (Rainfall) Poly. (GDP growth)

Source: National Advisory Committee on Environment and Sustainable Development (Comité National Consultatif
pour l'Environnement et le Développement Durable, CNECDD) 2013 and WDI 2016.

72. The steady growth experienced over the past decade and a half may not last. External
security threats originating from Niger’s northern neighbors Mali and Libya as well as from Boko
Haram in the south put increasing pressure on public finances as more resources have to be
allocated to the security sector. Unfavorable commodity prices for oil and uranium, the recession
in Nigeria, and the devaluation of the naira put further strain on the economy. With climate change
manifesting itself more visibly, it seems unlikely that the period of relatively favorable rains
(Figure 4.1) will last indefinitely. As the economy continues to rely heavily on agriculture, a major
contraction of economic activity remains a real possibility. Continued rapid population growth
increases the vulnerability of the economy as stresses on natural resources (fertile land, water, and
forests) increase with time. So far however, these doom scenarios have not materialized and GDP
growth remained relatively strong in 2015 at 3.6 percent (0 percent per capita).

36
73. To avoid continued exposure to shocks, the economy will need to become more
resilient and productivity needs to increase. The challenge is how. Investments in human capital
will be needed to improve the quality of the key factor of production. The business environment
will need to improve to increase the rate of return to investments. In terms of sectors, the most
promising growth path is to improve productivity in agriculture and livestock given the importance
of these sectors in economic terms, to promote agro-industrial transformation and to take
advantage of the fast-growing extractives sector to invest in the country’s human capital base. In
the longer term, Niger would need to expand its export basket to non-extractive sectors and
possibly the generation of remittances. There is scope for this as Niger’s economy is in relative
symbiosis with that of Nigeria which acts as a destination for exports, source of fiscal revenue
through reexports, source for remittances, and as a source of imports, in particular food. Niger
imports about 60–70 percent of its grain from Nigeria.32

Box 4.1: Niger’s economic symbiosis with Nigeria and consequences of the naira devaluation
Niger’s economy is heavily integrated with that of Nigeria. Niger shares 1,500 km of borders with its southern
neighbor and Niger’s main cities are located close to the border, including the capital Niamey. Corridors to Niamey
are also a path for informal reexports and trade smuggling to Nigeria.
Nigeria is a key destination market for Niger exports, first among which are livestock exports. Livestock products
are Niger’s main exports, with Nigeria receiving more than 95 percent of the total livestock products exported from
Niger. However, these exports have declined by 28 percent in terms of value and 30 percent in terms of quantity
since 2010, though these figures may be underestimated. In fact, live animal exports are far more likely to pass
through informal channels given the openness of the border, nontariff barriers, and multiple livestock markets along
the 1,500 km border. While exports of livestock to Nigeria are not quantified with accuracy, conservative estimates
put these exports in the range of US$150–190 million yearly, about 2 percent of GDP.
Reexports are another aspect of trade between Niger and Nigeria. Niger functions as a warehouse state for products
that are heavily taxed or subject to import restrictions in Nigeria, including used cars, textiles, rice, and cigarettes.
In 2014 and 2015, the value of reexports to Nigeria represented 15 percent and 12 percent of the GDP, respectively.
While these figures are not part of Niger’s trade balance, they however contributed the equivalent of approximately
1 percent of GDP to the national budget each year in terms of customs duties.
The cumulated effect of lower demand from Nigeria because of the recession in Nigeria for livestock and other
products exported by Niger and the lower transit trade is significant. The impact of transit trade alone could be
about 0.15–0.2 percent of GDP reduction in growth. The negative impact is mitigated to some extent by lower
prices of imports from Nigeria. Cereal imports from Nigeria, which account for 2 percent of GDP, play a major
role in food security. Well-organized distribution channels supply Niger’s markets from regions of Nigeria where
there is surplus production. The substantial naira devaluation affected prices of food products favorably, even
without full pass-through of this devaluation.
Remittances from Nigeria are equivalent to 0.6 percent of GDP. While less than what other countries attain (see
Figure 3.1), a non-negligible amount. Investment flows from Nigeria in recent years have been substantial,
equivalent to 1 percent of GDP, due to one large investment in cement. It is unclear whether the situation in Nigeria
will affect the prospects of any follow-up investments.
Finally, under an agreement with Nigeria, Niger imports around 80 percent of its electricity needs from Nigeria at
a relatively low cost, which makes it possible to supply consumers at relatively low prices. There is no impact of
the devaluation on electricity, as it is priced in euros.
Source: World Bank. 2016. Impact of Nigeria’s Economic Woes on Neighboring Economies: Update.

32
http://www.inter-reseaux.org/publications/revue-grain-de-sel/51-special-issue-nigeria/article/nigeria-s-role-in-
niger-s-food.

37
 4.2 Sources of Growth

74. On the output side, the primary sector continues to be the main driver of growth. The
primary sector has represented 45 percent of GDP on average over the last 15 years (Figure 4.2).
Within the primary sector, agriculture is the main economic activity with a share of 27 percent of
GDP. Livestock with 10 percent of GDP is also an important source of revenue and, as was
illustrated in Chapter 2, a key source of wealth for households.

75. There are few indications of structural transformation. Agriculture remains the
dominant sector in the economy and sectors such as manufacturing (6 percent of GDP),
construction and public works (3 percent of GDP), and production of electricity gas and water (1
percent of GDP) are relatively small and underdeveloped. More than 60 percent of GDP is
generated in the informal sector. The share of the secondary sector in GDP did increase over the
past 15 years, however. It averaged 19 percent in 2016, up from 13 percent in 2010 and from 2 to
5 percent in the early 2000s. This increase is due to the expansion of the extractives industry and
not due to growth in industrial production. Niger has significant mineral wealth with deposits of
uranium, gold, coal, and recently crude oil being commercially exploited. The extractive industry
generates significant though varying levels of revenue for the Government, from 11 percent of
total revenue in 2010 to 27 percent in 2012 but down in 2015 as a result of the decline in
commodity prices. The large contribution of the (formal) extractives sector to government revenue
is unsurprising given that Niger’s tax base is very narrow as most of the informal sector does not
contribute to government revenue. Extractives are the fastest growing sector (25 percent on
average between 2010 and 2015), but variability in commodity prices affects investments and
accentuates growth volatility in agriculture.

76. The tertiary sector generates around 40 percent of GDP, down from 45 percent of
GDP in the early 2000s. The relatively high contribution of the tertiary sector is not so much the
result of the development of a more modern section of the economy as the reflection of the
importance of import and export trade and the cost of transportation. Commerce and transport and
the public sector represent the most important activities in the tertiary sector with shares of 12
percent of GDP. Telecommunications is demonstrating the fastest growth in the tertiary sector (12
percent growth per annum on average between 2007 and 2016), followed by the public sector
which increased 9 percent per annum over the same period.

77. Productivity in agriculture is low. A comparison of value added and employment shares
shows that productivity in agriculture is low compared to the industrial and service sectors. The
value added per worker in agriculture is estimated at 328,000 CFAF as opposed to 632,000 CFAF
and 1,100,000 for those working in the secondary and tertiary sectors respectively. Also, in
comparison to other countries in the region agricultural productivity low. Using WDI data, the
GDP/worker ratio in Niger is half that of Sub-Saharan Africa.33 The sector is handicapped by
inadequate extension services,34 limited use of equipment and modern inputs, limited control of
water, a weak organization of producers, and declines in soil fertility. Weak organization of

33
World Bank staff estimates, 2014.
34
République du Niger, and FAO (Food and Agriculture Organization). 2009. Analyse diagnostique du système
d’appui conseil. Mise en place d’un dispositif intégré d’appui conseil pour le développement rural au Niger.

38
marketing channels and logistics—including inadequate storage facilities and limited ability to
process agricultural products—also account for low productivity in agriculture.

78. On the expenditure side, growth of investment by the public and private sector, and
exports contributed to the growth performance over the past decade (Table 4.1). Increased
aggregated demand also resulted in an acceleration of import growth. Household consumption
increased slowly, at about 4.2 percent per annum (or 0.2 percent per capita – in line with the
relatively slow decline in poverty) between 2007 and 2016 remained behind the rapid increases in
investments which increased by 12 percent per annum. As a consequence, the share of household
consumption in GDP declined from 79 percent in 2007 to 72 percent in 2016.

79. The public sector played an increasing role in Niger’s economic performance. The
National Development Strategy 2010–15 envisaged major public infrastructure projects in
education, health, roads, and the energy sector. To implement it the Government increased the
share of public investment from 7 percent to 15 percent of GDP between 2007 and 2016. Public
investment supporting the Plan de Développement Economique and Social (PDES) included large-
scale investment in transport (railroad) and construction and significant rehabilitation of public
buildings and roads in major cities. The Government also invested in agriculture (through the
Nigériens Nourrissent les Nigériens [3N] project) and in major projects like the railroad, the
Kandaji hydro dam, and the Soraz oil refinery. The efficiency of these large-scale investments,
which boosted growth in the short run, is limited as most of these projects are still not (fully)
operational. Moreover, the multiplier effect was limited as these projects were high in import
content. Like public investments, private investments also increased rapidly largely due to
investments in mining.

80. A growth accounting exercise (Figure 4.2) shows that increases in labor account for
most of the growth in Niger, followed by increases in the capital stock. This is in line with the
country’s high population growth and, more recently, increases in public and private investments
in infrastructure and extractives. There is little embedded technical change in these investments
and TFP is still catching up from a large decline in 1980. Other components, particularly changes
in human capital, play a much smaller role in explaining growth. The latter is unsurprising given
the low quality of education.

81. Exports are undiversified; imports show a potential for substitution through domestic
production. Uranium is the main export commodity, making up as much as 70 percent of total
exports in 2011, a share that declined to 46 percent in 2015 following the drop in prices. Gold is
Niger’s second largest export product followed by live animals—cows, sheep, and goats which are
mostly sold to Nigeria and Chad. In 2012, Niger exported more than 1 million head each of sheep
and goats and over 425,000 head of cattle. 35 This represents less than 10 percent of the total value
of exports, an underestimation of its true value as much of the export of live animals remains
unrecorded. Exporting of fuel products declined from 26 percent of total exports in 2013 to 8
percent in 2015 due to the decline in oil prices. Food and consumer goods comprise the main
imports, almost 30 percent of total imports in 2015. Niger is structurally food deficient, suggesting
a potential market for domestic production provided productivity in agriculture can be raised.

35
Stratégie de Développement Durable de l’Elevage (SDDEL) 2012–2035.

39
Driven by the boom in public investments, capital goods comprised about 25 percent of total
imports in 2015.
Table 4.1: Structure of the Niger Economy: 2007-2016
Annual growth
Real GDP GDP per capita Share of GDP
2007-2016
Per
2007 2016 2007 2016 2007 2016 GDP
capita
Primary sector 843.1 1221.7 60,032 61,169 44% 41% 4.2% 0.2%
Agriculture 504.1 811.9 35,894 40,650 27% 27% 5.4% 1.4%
Livestock and hunting 251.7 293.3 17,922 14,684 13% 10% 1.7% -2.2%
Forestry 55.2 56.0 3,928 2,802 3% 2% 0.2% -3.7%
Fishing 32.1 60.6 2,287 3,034 2% 2% 7.3% 3.2%
Secondary sector 261.1 578.8 18,589 28,977 14% 19% 9.2% 5.1%
Extractive activities 80.8 258.5 5,750 12,945 4% 9% 13.8% 9.4%
Uranium 87.9 4,399 3%
Petrol 123.9 6,203 4%
Gold 29.1 1,456 1%
Informal extractives 19.2 962 1%
Related activities 9.9 493 0%
Manufacturing 106.6 182.1 7,588 9,117 6% 6% 6.1% 2.1%
Electricity, gas and water 22.2 41.9 1,578 2,096 1% 1% 7.3% 3.2%
Construction 51.6 96.3 3,673 4,820 3% 3% 7.2% 3.1%
Tertiary sector 794.5 1206.8 56,571 60,424 42% 40% 4.8% 0.7%
Commerce and repairs 262.0 368.1 18,656 18,428 14% 12% 3.8% -0.1%
Transport and storage 102.5 117.5 7,301 5,882 5% 4% 1.5% -2.4%
Hotels and restaurants 28.8 36.3 2,051 1,819 2% 1% 2.6% -1.3%
Communication 32.3 78.3 2,303 3,920 2% 3% 10.3% 6.1%
Other commercial activities 116.3 139.4 8,282 6,980 6% 5% 2.0% -1.9%
Public sector 218.9 435.1 15,585 21,785 12% 14% 7.9% 3.8%
Other services 33.6 32.2 2,393 1,612 2% 1% -0.5% -4.3%
GDP at factor costs 1898.8 3007.3 135,192 150,571 100% 100% 5.2% 1.2%
Taxes net of subsidies 144.7 257.8 10,305 12,906 8% 9% 6.6% 2.5%
GDP at market prices 2043.5 3265.1 145,498 163,477 108% 109% 5.3% 1.3%
Informal GDP 1299.1 1896.5 92,496 94,954 68% 63% 4.3% 0.3%

Consumption 1821.4 2642.9 129,683 132,322 96% 88% 4.2% 0.2%

Households 1493.3 2155.0 106,324 107,894 79% 72% 4.2% 0.2%
Public sector 328.1 487.9 23,359 24,428 17% 16% 4.5% 0.5%
Investments 471.0 1386.0 33,533 69,396 25% 46% 12.7% 8.4%
Private sector 337.8 941.3 24,053 47,129 18% 31% 12.1% 7.8%
Public sector 130.2 444.7 9,268 22,267 7% 15% 14.6% 10.2%
Trade
Exports of goods/services 366.5 571.4 26,094 28,609 19% 19% 5.1% 1.0%
Imports of goods/services 615.3 1335.2 43,812 66,851 32% 44% 9.0% 4.8%
Source: Government of Niger 2015.

40
 Figure 4.2: GDP, growth, and the external sector
The economy is dominated by agriculture and the Growth is volatile due to exogenous factors such as
extractives sector. There is no evidence of structural rainfall and commodity prices.
transformation.
Sectoral distrbution of GDP (%) Contributions to Growth (supply side %)

100 20
90
15
80 42 42 39 39 41 37 38 38 38
46 44 43 42 45 43 42
10
70
60 5
12 11 12 13 17 18 17 16
50 13 13 12 12 12
13 13 13 0
40 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
-5
30
45 46 47 50 46 49 46 47 46 45 -10
20 41 43 44 42 44 45

10
Agriculture Uranium Oil
0
2000 2003 2006 2009 2012 2015 Industry Services Taxes

Primary sector Secondary sector Tertiary sector GDP

Relative to other sectors in the economy, productivity in Growth is driven by increases in labor and more
agriculture is low. recently by capital accumulation and inceases in TFP.
Employment share (% of total employment) and value added (% of GDP), 2012 5 Growth Accounting 1974-2011
4
70 65 4 3

60 3 2
2 2
1 2
50 2
41
38 0
40
1 0 0
Percent

0
0
0 0 0 0
30
0
21
19 GDP Growth Labor Capital Human Capital TFP
20 16
-1 -0 -0

10 -0
-2

0
Agriculture Industry Service -3
-2
70-79 80-94 95-04 05-11
Employment share Value added (% of GDP) -4

Mining products comprise the bulk of exports. Food and capital goods are key imports.
Exports by group of products Imports by group of products

100% 100%

90% 90%
80%
80%
70%
70%
60%
60%
50%
50%
40%

30% 40%

20% 30%

10% 20%
0% 10%
2011 2012 2013 2014 2015e
0%
Food Livestock Mining Petroleum Services 2011 2012 2013 2014 2015e

Food products Consumption goods Intermediate goods Capital goods Fuels Services

Source: IMF 2015, Government of Niger, WDI 2015, Staff estimates.

Note: TFP = Total Factor Productivity.

41
 4.3 Behind the Headline Numbers

82. Niger’s economy is characterized by challenging initial conditions which increase the
cost of doing business. Salient characteristics include unfavorable geographical conditions, high
rates of population growth, a weak human capital base, a large informal sector (the nonagricultural
informal sector is estimated to constitute between 23 percent and 29.5 percent of GDP), an
underdeveloped financial sector, lack of infrastructure, and an unfavorable business environment.

83. As a landlocked country in the Sahel, options for farming and livestock rearing are
limited by the harsh climate. Nearly 90 percent of the territory receives less than 350 mm of rain
every year. Rainfall is extremely variable and not equally distributed across the country, leading
farmers to adopt costly risk aversion strategies such as cultivating multiple plots at large distances
from each other. Not only droughts but also floods occur regularly and reflect the most important
climate risk the country is facing.

84. High population growth rates and a weak human capital base limit economic
opportunities. Niger’s high population growth of 3.9 percent per year places increasing pressure
on arable land, which constitutes only 12 percent of Niger’s land mass, water, and forestry
resources. The stock of human capital is low despite significant progress in school enrollment.
Niger lacks people with higher education. In 2011, gross secondary school enrollment was around
13 percent compared to 35 percent36 in comparator countries. There were only 22,000 university
students in 2011, most of whom were enrolled in humanities courses. Apart from the low numbers,
and as discussed in the previous chapter, the quality of the education system remains weak, leading
to a labor force that is largely unskilled and which leaves basic jobs in electricity, repairs,
plumbing, or services to better-educated foreigners.

85. The financial sector is shallow. Lack of proximity of financial intermediaries due to
dispersed population and weak infrastructure hinders the development of the financial sector.
There are only 1.5 commercial bank branches per 100,000 adults.37 In Agadez, for example, there
are 8 points of contact for a population of about 130,000. Ninety-three percent of the adult
population does not have access to any kind of financial services, thus limiting their ability to
absorb shocks; make long-term plans; and invest in education, agriculture, or other entrepreneurial
activities. Credit to the economy, a measure of the degree of financial intermediation, averaged 15
percent of GDP over the recent past, the lowest among the eight WAEMU member states. Of this
credit, very little (2 percent) is invested in the agricultural sector despite the importance of
agriculture for the economy. Less than 5 percent of the credit provided by the agriculture state-
owned bank—Agricultural Bank of Niger (Banque Agricole du Niger, BAGRI)—went to the
agriculture sector. Only 2.5 percent of lending of the whole banking sector went to agriculture.38

86. Agricultural financing is limited as many factors constrain its development. These
factors include low population density that makes it unprofitable to service isolated areas using

36
WDI 2012.
37
WDI.
38
Short-term loans are defined as having a duration of less than two years. The duration of medium-term loans is
fixed at between two years and ten years. Loans with a length of more than ten years are considered long-term loans.
(BCEAO, “Décision No 397/12/2010 Portant Règles, Instruments et Procédures de Mise en Œuvre de la Politique de
la Monnaie et du Crédit de la Banque Centrale des Etats de l’Afrique de l’Ouest,” December 2010.)

42
traditional banking methods; the riskiness of agricultural loans; a lack of financial information on
farmers/herders; the lack of collateral in rural areas; and a lack of organization of farmers. The
Government’s efforts to address the shortage of agriculture finance have achieved limited results
and contributed to crowding out the private sector. Microfinance institutions have tried to serve
this underserved agriculture market. However, a lack of liquidity, lack of competencies for
agriculture lending, and other issues related to the microfinance sector are impediments. The
current situation is one in which the main products of many microfinance institutions—short-term
working capital loans with frequent expected repayments—are not well-suited to some of the
longer-term agricultural activities while financial products adapted to the agricultural sector, such
as micro-leasing or warrantage, are not on offer.

Figure 4.3: The business environment

High cost of production due to poor initial conditions Bureaucratic measures make exporting costly.
are made worse by an adverse business environment.

$543
Doing business indicators, 2016 Cost to export

$490

$486
Starting a business (134)

Construction Permits Enforcing contracts

(178) (154)

$204
Trading across borders

$191
Getting electricity (169)

$175
(156)

$163

$155
$144

$143

$111

$96

$86

$33
Registering property

$25
$17
Paying taxes (158)
(126)
Senegal

Senegal
Togo

Togo
Kenya
Kenya
Niger

Niger
Protecting Minority
Ghana

Ghana
Ethiopia

Burkina Faso

Mali

Ethiopia

Burkina Faso

Mali
Getting Credit (133)
Investors (166)

Cost to export: Border compliance (US$ per Cost to export: Documentary compliance (US$ per

Access to electricity is difficult… …mobile phone subscriptions are low as the cost of
telecommunications is high.
129
183 Ease of getting electricity rank Mobile telephone subscriptions
170 169
108
151

92 95
129 127
121
109
70
66
62

39

27

Burkina Faso Senegal Niger Mali Ethiopia Kenya Ghana Togo

Ethiopia Niger Togo Burkina Kenya Senegal Côte Ghana Mali
Faso d'Ivoire

Source: World Bank Doing Business 2016 and International Telecommunication Union (ITU) 2016.

87. Digital finance, which is a promising way to improve financial inclusion, remains at a
nascent stage. The number of mobile money transactions per 1,000 adults was at 69 in 2014
compared to 87 in Burkina Faso and 636 in Côte d’Ivoire.

88. The supply and quality of infrastructure are low. Transportation is key for a large,
landlocked country but road density is low and only 21 percent of roads in Niger are paved. Recent
data indicate that nationally 77.3 percent of paved roads and 73.6 percent of unpaved roads are in

43
good or fair condition.39 While it is only a small segment of the economy and the transport sector,
air transport is potentially of high importance given its ability to link the country to high value
added value chains (Paris is only a 5-hour flight away). Among the three international airports
and40 three domestic airports, the bulk of air traffic passes through Diori Hamani International
Airport in Niamey. Most recent data indicate that traffic is limited, with approximately 130,000
passengers and less than 4,000 tons of freight a year. 41

89. As a landlocked country, access to international markets is by all measures extremely

costly. Any added cost due to inefficient transport markets, burdensome and outdated regulations
and agencies, and inadequate infrastructure is like an added markup on all that Nigeriens consume
in imported products and that firms produce for external markets. Niger benefits from access to
several international trade corridors, but all of them represent distances farther than 1,000 km. The
shortest distance—1,035 km—is between Niamey and Cotonou. It is the most important transit
corridor and accounts for about 80 percent of the total traffic. Lomé is 1,240 km away and captures
about 15 percent of the traffic. Other ports are farther away and represent a modest part of transit
for Niger: Tema 1,500 km away, Abidjan 1,700 km away, and Lagos 1,525 km away. In the next
decade, the volume of traffic to Niger is expected to more than double. A comparison in the region
finds that Cotonou-Niamey has slightly lower costs per ton-km than other corridors. However,
transit time still takes 21 days on average and is subject to high variance of up to 40 days. Cost
and time of transit are multiples of what is experienced in developed economies and estimates
suggest that reform could lower costs by 15 percent on average.42 Prices for millet and sorghum
increase by 20–25 percent due to the border effect alone.43

90. Access to electricity is limited and power outages occur frequently. Despite an increase
in the share of the population with geographic access to the grid from 17 percent to more than 23
percent, the share of the population actually accessing grid electricity increased is less than 9
percent.44 Electricity is provided by the state-owned electric utility Electricity Company of Niger
(Société Nigerienne d'Electricité, NIGELEC) which purchases two-thirds of its electricity from
Nigeria at a subsidized rate of US¢3 per kWh, a rate established in 1977. 45 Imports lag behind the
fast growing demand and are constrained by transmission capacity. NIGELEC has pro-actively
engaged in various investment plans to partially meet the generation and transmission gaps,
including a two-year rental contract for 30 MW of small diesel units whose generation costs are

39
Niger Ministry of Works.
40
In addition to the airport at Niamey, the other two international airports are the Zinder International Airport,
located 900 km east of Niamey, and the Mano Dayak Airport in Agadez, 960 km northeast of Niamey.
41
Niger Ministry of Works, Statistics Department.
42
Nathan Associates. 2012. Impact of Road Transport Industry Liberalization in West Africa. Report for USAID.
43
Aker, Jenny C., Michael W. Klein, Stephen A. O'Connell, and Muzhe Yang. 2014. “Borders, Ethnicity and
Trade.” Journal of Development Economics 107.
Interestingly they also find that price differences are lower when traders of the same ethnicity (Hausa) are involved,
thereby suggesting that costs diminish when trade is facilitated and also suggesting that trade may naturally happen
more easily in regions where Hausa traders are present in larger numbers (such as the Maradi-Katsina-Kano
corridor, Zinder-Daoura-Kano corridor).
44
Système d’Information Energétique. Ministère de l’Energie, Niger.
45
Given this price, alternative choices of production would cost a much higher price. Diesel generation would cost
about US¢30 per kWh and coal generation US¢12 per kWh. “Niger’s Infrastructure: A Continental Perspective,”
June 2011, pp 29.

44
close to US¢30 per kWh and the development of the Kandaji multipurpose hydropower project,
which is expected to enter into operation in 2020–2021.

91. The ICT infrastructure is substandard and tariffs are high. Numbers from 2011
indicate that the use of mobile phones and Internet is limited, with only 27 mobile phone
subscriptions per 100 people and only 1.3 percent of the population using Internet services, the
lowest among its comparator countries. The total number of fixed broadband subscriptions is less
than 2,000.46 Tariffs are high, a reflection of the lack of competition in a market in which only two
providers are active. 47

92. Counterfactual analyses show that significant gains could be made if inefficiencies in
infrastructure were fixed. Niger could grow by as much as 4.5 percentage points per capita if it
expands and improves its infrastructure, particularly in the road sector. Improving the condition of
paved and unpaved roads would facilitate and increase trade within the country, boosting economic
growth by 1.71 percentage points. Power would contribute around 1.51 percentage points to per
capita growth if generation capacity and national access rates—which as of today are among the
lowest in the region—were increased. ICT would also make an important contribution to economic
prospects (1.31 percentage points), provided the mobile phone and Internet markets continue
expanding. The Millennium Challenge Corporation (MCC) analysis shows that investing in
making water more available is a worthy venture and the value added per hectare for rice
production improves by over 75 percent when water management infrastructure is used. Yields in
treated areas increased substantially for onions, Niger’s fifth largest export, which experienced
yield increases from 26 tons per hectare to 41 tons per hectare.

93. Rather than aiming to offset unfavorable initial conditions by a favorable business
environment, the reverse is the case. While efforts aimed at improvement are ongoing, Niger
continues to score very low on the Doing Business indicators and burdensome institutional and
regulatory barriers continue to affect private sector operators. Significant differences in the tax
system exist, for instance, between formal and informal enterprises, and competition from the
informal sector which is lightly taxed reduces incentives for growth in the formal sector. The time
devoted to dealing with government requirements and regulations is much higher in Niger than
elsewhere in Sub-Saharan Africa or in other low-income countries.48 For example, the time and
documents needed to imports are nearly twice the Sub-Saharan Africa average and are worse than
for other similar landlocked countries.49

46
International Telecommunications Union, ICT Eye, 2011.
47
Niger’s high illiteracy rate, which is greater than 70 percent, is expected to reduce relative demand for
telecommunication services.
48
Enterprise Survey in 2009.
49
Doing Business 2013.

45
 Figure 4.4: Access to finance (2014)
Access to finance is limited. Relative to other countries in the subregion, access to financial institutions is
constrained by the small number of points of contact. Consequently, few people have bank accounts.

Number of point of contacts Account (% of people aged 15+)

600 551 40
34 34
492 35
500 447 461
402 30
400 25 20
18
300 264 20 16 15
14
15
200 158
10 6
100 5
19
0
0 SSA Benin Burkina Cote Mali Niger Togo Senegal
Benin Burkina Cote Guinea Mali Niger Senegal Togo Faso d'ivoire
Faso dÍvoire Bissau

As few people have bank accounts, formal savings are low as is lending. Mobile money does not make up for the
limited access to formal financial institution as the ICT sector is also underdeveloped.
Niger vs SSA : Financial inclusion indicators
Access and Usage of Mobile Money
Saved at a fin. Inst. in the past year (% 15
Number of accounts (thousands)
age 15+) 1 Active mobile
268
accounts

12 Registered
Mobile accounts (% age 15+) 1,599
3 mobile accounts

Mobile phone
Loan from a fin. Inst. in the past year (% 6 7,845
(ownership)
age 15+) 1

Adult
8,898
24 population
Account at a formal financial institution
(% age 15+) 3
Sub-Saharian Africa (SSA) Total population 17,830
0 5 10 15 20 25 30
Niger (2014)

Source: Financial Inclusion Index (FINDEX), Central Bank of the States of West Africa (La Banque Centrale des
Etats de l'Afrique de l'Ouest, BCEAO), The Microfinance Sector Regulatory Agency (L'Agence de Régulation du
Secteur de la Microfinance, ARSM) 2014.

94. Niger has enjoyed a relatively stable macroeconomic policy framework. Niger benefits
from its membership of the WAEMU which, together with the BCEAO, oversees macroeconomic,
monetary, and fiscal management. This has helped maintained a sound macroeconomic policy. As
a consequence, inflation has remained low (less than 3 percent). WAEMU membership also comes
with downsides as the absence of the possibility to rely on monetary and exchange rate policies
puts the onus on fiscal policy to make appropriate adjustments when the economy faces a shock.
Typically, such adjustments will take place in the investment budget, which makes public
investments subject to large, inefficient and costly, swings. Faced with low natural resource prices,
a devalued naira and increased security spending, Niger’s authorities are presently facing the need
to make such adjustments.

95. The level of public debt is manageable and stood at 42 percent of GDP in 2015. Niger
reached the completion point under the Enhanced Heavily Indebted Poor Countries (HIPC)
Initiative in April 2004 and in 2006 benefited from Multilateral Debt Relief Initiative (MDRI)
assistance from the African Development Fund, International Development Association (IDA),

46
and the International Monetary Fund (IMF). The debt relief contributed to a reduction of nominal
external debt from around 90 percent of GDP at end-2000 to 17 percent of GDP at end-2010. The
level of external public debt in Niger has increased significantly from 17 percent of GDP in 2010
to 30.4, percent of GDP in 2016 due to the Government’s involvement in the financing of natural
resource projects. The private sector’s debt is related to the large oil and uranium projects and the
stock of external private debt was 28 percent of GDP in 2014 and is projected to stabilize just
above 20 percent in the long run.

96. Niger’s medium-term outlook remains adequate but has significant downside risks.
Niger’s medium–term macroeconomic prospects remain positive with a projected growth of 5.5
percent on average through 2019 and higher from 2020 onwards with an expected resumption of
commodity prices. Although the current account deficit has recently increased following
investments in the extractive industries, the Government’s foreign exchange reserves at the
BCEAO are equivalent to 4.4 months of imports and are broadly adequate. The Government
envisages a strong fiscal consolidation path driven by better expenditure efficiency while the
current account is expected to improve as a result of more efficient public investment and better
performance of the extractive sectors. These results are subject to significant downside risks. Niger
is enduring the effects of structural changes that affect the economy, including commodity price
shocks along with continued tense security situation and the impact of the recession in Nigeria.
The risk that commodity prices do not return to their levels during ‘the glory days’ both for oil and
uranium is high; persisting security challenges take a toll on public resources with a level of
security spending estimated at 5 percent of GDP in 2015, a situation which may last and remain
tense for the years to come. The depreciation of the naira significantly affects Niger’s trade, mainly
agriculture and livestock. If these risks materialize, the macroeconomic situation may deteriorate
and represent a major constraint to growth.

4.4 Policy Simulations

97. To assess different pathways to poverty reduction systematically, a range of a range

of scenarios were simulated to assess the economy-wide effects of different government
policies and economic shocks. To this end a Computable General Equilibrium (CGE) model was
built. It is a single country model drawn from the World Bank’s global CGE model (LINKAGE).
The model is calibrated on a Social Accounting Matrix (SAM) comprising 45 sectors, 7 factors,
and 10 households representing each consumption decile. The model is a recursive dynamic CGE
model that links a sequence of static equilibriums with a set of equations, which update, at every
period, a selection of macroeconomic variables (population growth, capital stock, and
productivity). The SAM was developed by the Niger National Bureau of Statistics and expanded
to include four types of labor, capital, land, and natural resources to enable a richer set of reforms
to be modelled. Similarly, the single representative household was expanded to ten households,
each representing a consumption decile. The expanded SAM uses data from the establishment
survey, wage indicator survey, household expenditure survey, and GTAP (Global Trade Analysis
Project) database. While much effort has gone into carefully designing the CGE, simulation results
still need to be interpreted with great care.

98. Given the agricultural base of the economy and the depth of rural poverty, the first
scenario that was attempted was one in which the productivity of agriculture improves. The
results lend support to the notion that improvements agricultural technology have the potential to

47
lift activity and incomes of the poorest households. Investment that leads to a 10 percent
productivity boost to capital in the agriculture sector leads to a 3.8 percent expansion of the sector
by 2030, relative to the baseline.50 The productivity boost also supports higher incomes and by
2030, GDP is 1.7 percent higher than would otherwise be the case.

99. While all households enjoy a boost in consumption, poor households enjoy the highest
boost. The consumption of the bottom 40 percent of households (consumption deciles) increases
by 3.6 percent. In contrast, the consumption of the top 60 percent of households increases by 2.2
percent. This occurs for two main reasons. First, poor households derive most of their earnings
from agriculture. Second, the consumption basket of low-income households is heavily weighted
toward agriculture products, so the price of their consumption basket falls by a large amount. In
contrast, the income boost for the top deciles is more muted since they derive their income mainly
from nonagriculture sectors. In addition, the consumption basket for rich households is weighted
toward services, so the fall in the price of their consumption is also more muted.

100. The simulations also demonstrate that only in combination with improvements in
trade facilitation, do investments in agriculture generate the most significant results. This is
unsurprising as increased agricultural production needs to find a market. A 10 percent reduction
in transportation costs (reducing iceberg trade costs) would lead to a 19 percent increase in exports
by 2030; the cost reduction means that effectively exporters are receiving an additional 1–2 percent
in income for each unit of exports. The lift in export volumes combined with higher agriculture
productivity support an expansion of GDP of around 3 percent relative to the baseline by 2030.

101. The benefits of improving trade facilitation and boosting trade are spread more
evenly across rich and poor households because this reform benefits all sectors of the
economy. In combination with the agriculture productivity boost, improving trade facilitation and
boosting trade benefits poor households more than rich households. Consumption of the bottom
40 percent increases by 10 percent, while consumption of the top 60 percent increases by 7.5
percent.

102. A number of other simulation have been carried out, including ones in which there
are major investments in education, in which the efficiency of public investments does not
improve and one that assesses the consequences of an adverse weather event. These are
presented in Annex 2.

50
The cost of such investments has not been considered in the simulation, so these results can be interpreted as the
upper end of possible effects.

48
 Table 4.2: Selected Economic and Financial Indicators, 2013–2020

2013 2014 2015e 2016p 2017p 2018p 2019p 2020p

Real Economy (annual percentage change, unless otherwise specified)
Real GDP 5.3 7.0 3.5 4.5 5.2 5.5 5.4 7.4
Non-resources GDP 4.2 7.9 4.1 4.3 5.0 5.6 5.5 6.0
Per Capita GDP (US$ Atlas Method) 372.7 382.7 380.5 383.7 388.2 395.3 402.4 …
Government Consumption 26.3 16.3 11.0 -3.5 9.2 4.9 5.0 5.1
Investments 4.8 6.6 7.0 9.6 5.9 6.4 7.4 …
Imports 2.6 7.0 9.6 -3.9 13.1 10.1 9.2 10.2
Exports 6.5 -8.8 -10.1 -5.0 7.4 11.9 11.3 31.2
Consumer price inflation (average) 2.3 -0.9 1.0 1.6 2.0 2.1 2.0 2.0

Fiscal Accounts (Percent GDP, unless otherwise indicated)

Expenditures 27.2 31.0 32.7 26.5 28.1 27.3 26.4 26.0
Revenues 16.6 17.5 18.1 15.3 16.1 16.8 17.5 19.1
Overall balance (commitment basis, -4.7
including grants) -2.6 -8.0 -9.1 -6.5 -7.4 -6.0 -2.9

(Annual change, in percent of beginning-of-period broad money)

Selected monetary Accounts
Base money 10.1 25.7 3.6 14.4 9.4 9.7 11.5 9.6
Credit to non-government 2.5 6.1 6.8 7.5 4.2 4.3 3.9 4.6

Balance of payments (Percent GDP, unless otherwise indicated)

Current Account Balance -15.1 -15.4 -18.1 -15.4 -18.0 -18.5 -18.1 -15.4
Imports of goods and services, f.o.b. 26.3 26.2 27.5 25.3 26.7 27.3 27.7 28.1
Exports of goods and services, f.o.b. 20.7 17.5 15.2 13.8 13.8 14.3 14.8 17.9
Foreign Direct Investment 8.1 8.9 6.9 7.7 8.8 10.5 10.9 8.9
Gross reserves (in US$, eop)
In months of next year’s imports 4.2 4.8 4.6 4.2 3.9 4.0 4.0 4.1
Total Public Debt 27.2 33.7 41.9 47.0 51.5 53.0 53.9 52.4
Public External Debt 22.6 25.1 30.4 34.1 35.8 37.1 36.8 38.5
Public Domestic Debt 4.6 8.7 11.5 12.9 15.3 16.0 15.8 14
Foreign aid 11.1 8.9 10.4 9.5 9.0 8.9 8.4 7.5
Terms of trade (percentage change) -3.1 -19.4 -7.5 11.0 -4.9 1.2 -4.7 -4.7
Exchange rate (average) 494.2 536.8 596.9 596.9 596.9 … … …
Memorandum items:
GDP (Nominal-local currency) 3,703 4,077 4,242 4,430 4,761 5,130 5,504 5,993
Source: Nigerien authorities; IMF and World Bank estimates and projections, November 2016.

49
5. Governance
5.1 Introduction

103. Niger can be characterized by the recurrence of political, social, economic and
security crises. Following independence in 1960, the country has known three coups (1974, 1996,
and 2010); one presidential assassination (1999); and four returns to civil rule (1989, 1996, 1999,
and 2011). Rebellions (1990 and 2007), coup attempts (1976 and 2015), soldier mutiny (2002),
and major droughts and hunger in 1968–1973, 2005, and 2010 add to the volatile mix of Niger’s
politics. Early 2016 the country was in the grip of presidential elections and the effects of increased
insecurity.

104. Niger has been affected by terrorist attacks. Islamist militant sects have launched suicide
attacks in Agadez and at the uranium mine in Arlit. There have been several suicide car bomb
attacks and kidnappings of foreigners for ransom. Niger is battling an insurgency by the Islamic
militant sect Boko Haram, with a state of emergency declared in the Diffa region and about a third
of Diffa’s population forcibly displaced. Spillovers from crises in northeast Nigeria, Libya, Chad,
and northern Mali affect the country, with Niger having to cater for some 198,000 refugees.51 Niger
has placed a significant group of soldiers as part of the UN’s peacekeeping mission, United Nations
Multidimensional Integrated Stabilization Mission in Mali (MINUSMA), in the Gao region in
northern Mali.

Figure 5.1: Public Financial Management

Budget and budget execution are not only very weak, they are not improving.
Budget and budget execution PEFA scores
Budget credibility
2 100% 6
86%
Budget and expenses (million FCFA)

5
74%
80% 4
1 68% External control Completeness and
3
Execution rate (%)

and audit transparency

60% 2
1 1 1 1
1 1 1
1 0
40%

500
20% Accounting,
Budget based on
recording and
policy
reporting
- 0%
2008
2013 2014 2015
Axis Title 2012
Forecast and
control of the 2016
budget
Approved budget Actual expenses Execution rate

Source: Public Expenditure and Financial Accountability (PEFA) 2008, 2012, and 2016.

105. Political crises occur regularly and lead to leadership changes without plunging the
country into violence or instability. The price that is paid for this relative stability are poor
governance indicators (Figure 5.2) and the economic exclusion of the majority of the population52.
Public financial management (PFM) is one area in which governance challenges touch upon the

51
World Bank, and UNHCR (United Nations High Commissioner for Refugees). 2016. “Forced Displacement by
the Boko Haram Conflict in the Lake Chad Region.” Data provided by UNHCR Niger in May 2015.
52
BTI 2016.

50
core functions of the state. The overall budget increased from 22.3 percent of GDP to 30.1 percent
of GDP between 2012 and 2015, reflecting a significant increase in public investments which
reached 17 percent of GDP in 2015, up from 11 percent of GDP in 2012. This has been
accompanied by an increase in the level of external public debt which has more than doubled,
increasing from 26 percent of GDP in 2012 to 53 percent of GDP in 2016 due to the Government’s
involvement in the financing of natural resource projects, infrastructure, and social spending.
While budgets increased in size, budget execution remains very weak. In fact, according to the
2016 PEFA report, PFM is too weak to be satisfactory. It is so weak that budgetary discipline is
not assured. These weaknesses show up on low budget execution rates which, between 2013 and
2015, varied between 68 percent and 86 percent, with large differences between years (Figure 5.1).
Weak PFM is not a new phenomenon. It was already clearly identified in the 2003–2004 PEMFAR
report and has been reflected in the PEFA scores since. Improvements in certain areas have even
been registered but these have largely been undone by deteriorations in other areas. Consequently,
there has been very little progress overall.

106. Another area where poor governance has real consequences is with respect to the
business environment which is severely constrained. Nigerien firms report spending an average
of 21 percent of their time dealing with regulatory requirements as compared with an average of
6.8 percent for Sub-Saharan Africa.53 Trade is equally constrained by Niger’s regulatory and
institutional environment and the lack of a reliable judicial system to resolve disputes. It takes an
inordinate amount of time to file paperwork (192 hours for documentary compliance when
importing), there are costly delays at border crossings (114 hours when importing), and bribes or
informal payments may be expected. Additional delays may be created or payments solicited at
roadblocks and checkpoints along major transportation arteries. Domestic and international
regulation of the transportation and trucking sector may distort or limit competition within the
sector, resulting in high prices and poor-quality service. Niger ranks 158 out of 189 countries on
the Trading Across Borders indicator in Doing Business 2016. This is not simply a function of
being landlocked, since Niger performs worse than the other landlocked comparator countries such
as Mali (ranked 82) or Burkina Faso (103).

107. Governance indicators, particularly those associated with inclusive policies, improved
over the past decade but on average they remained unchanged as others deteriorated. There
has been a marked and encouraging improvement in a number of areas of governance over the past
15 years, with improvements in voice and accountability, economic managements, social inclusion
and equity, and anticorruption, changes that are associated with more inclusive policies. Greater
inclusiveness of the regime is reflected by the 3N program which is aimed at reducing widespread
food insecurity by improving agricultural productivity and an evolving decentralization process
with citizens gradually becoming more involved in municipal councils and school governance
structures. Social indicators seem to reflect this greater inclusiveness and have been improving.
These improvements took place in an environment in which the security landscape worsened, with
concomitant declines in governance indicators related to political stability and the absence of
violence and terrorism.

53
The amount of time devoted to dealing with the regulatory burden is even higher for medium sized firms (29.1
percent) and large firms (24.4 percent) in Niger. Enterprise Survey.

51
 Figure 5.2: Governance indicators: 1996–2014
After a rapid increase due to improved voice and Minor improvements in government effectiveness, rule
accountability around the year 2000, governance of law, and regulatory quality have been offset by a
indicators changed little. decline in political stability and absence of violence.
5
World Governance indicators World Governance Indicators
4 4 Regulatory Quality, Estimate
Voice and Accountability, Estimate
Political Stability and Absence of Violence/Terrorism, Estimate Rule of Law, Estimate
Government Effectiveness, Estimate 3 Control of Corruption, Estimate

2
2

0
0 1996 1998 2000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
1996 1998 2000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

The CPIA shows gradual improvement in non-security Despite improvements (in 2010 Niger ranked 134th on
related indicators. CPIA improvements are driven by the perception of corruption index for instance),
economic management and social inclusion and equity. goverance remains generally poor.
4 139
CPIA score 2015 Perception of Corruption Index

103 107 107

4 95 99

76
61
3 56

3 Economic management
Structural policies
Social inclusion and equity
Public sector management
CPIA Ghana Senegal Burkina Mali Niger Ethiopia Côte Togo Kenya
2 Faso d´Ivoire
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Rank 2015 Perception of Corruption Index
Poor goverance has an impact on the real economy. and the cost of doing business is high
Government effectivess is low…
Government Effectiveness Index 2015, Percentile Rank (100 is best) 43 44

908
885
820
Cost of doing business: imports

762
757
750

725
38

668
643
35
550
545

30
375
351

23
302

298
21
282

265
252
209
203

197
192

14
123
120
84
77
54

9
Senegal

Senegal

Senegal
Ethiopia

Ethiopia

Ethiopia
Togo

SSA Avg

SSA Avg

Togo

Togo

SSA Avg
Burkina Faso

Ghana
Kenya
Mali

Mali

Burkina Faso

Mali
Burkina Faso
Ghana

Kenya

Kenya

Ghana
Niger

Niger

Niger

Togo Mali Côte Niger Burkina Ethiopia Senegal Kenya Ghana

d'ivoire Faso
Government Effectiveness Index 2015, Percentile Rank (100 is best) Time to import: Documentary Cost to import: Documentary Cost to import: Border compliance
compliance (hours) compliance (USD) (USD)

Source: World Bank 2015. World Governance Indicators, Country Policy and Institutional Assessment (CPIA)
various years, and Doing Business 2016. Transparency International 2015. Perception of Corruption Index.

5.2 Niger’s Political Settlement

108. The political settlement in Niger is characterized by a relatively small elite, who have
an interest in maintaining overall stability but who also compete with each other over access
to rents from the country’s natural and environmental resources, illegal trafficking, and aid as well

52
as profits from skimming public procurement.54 The political settlement and the ruling coalition
changes over time as new powerful actors are coopted and others sidelined. The Nigerien political
settlement is thus dynamic and in a continuous process of redefinition of the elite coalition based
on a consensus to share political power and economic resources. Still, the size of the inner circle
remains fairly small and relations are personalized as opposed to rule based. This is most evident
in the judicial system which is overburdened and underresourced. There are few registered lawyers
outside Niamey, the cost of legal aid is too high for the vast majority of the population and
allegations of corruption frequent. 55

109. A limited number of key actors can be identified. There are those providing security,
comprising the gendarmerie (some 16–17,000 people), the National Guard, the police, and the
military. The latter are small in number (approximately 12,000) but powerful. They are well paid,
equipped, and organized. The military are battle hardened, and officers are trained at one of the
best schools in the country. The military benefit from external strategic intelligence and
operational support, largely from France and the United States.56 They are the ‘guardians’ of the
country’s significant natural resources, uranium and more recently oil, and a partner in the war on
terror. Traditional chiefs and sultans as well as religious leaders derive their power from their
social status and their ability to mobilize citizens.57 Businessmen—powerful traders in particular—
and politicians hold each other in a tight embrace, with politicians depending on the financial
support of business men to win elections, while business men depend on politicians to gain
favorable treatment with respect to public contracts, licenses, or (import) tax exemptions. A final
group that needs to be recognized are Niger’s deprived citizens. Though generally powerless, the
military coups of 1974, 1996, and 1999 were predicated by poor economic management and
popular dissatisfaction (see Box 5.1). The greater inclusiveness in policies observed starting 2000
may be a reflection of leaders realizing the importance of ensuring that the (minimum) economic
needs of the population are met. 58

110. The elite coalition remains fluid. The survival of the ruling elite coalition depends on its
capacity to distribute privileges and to weaken opponents through co-optation or other means.59
Each formation of government in Niger thus reflects an equilibrium in terms of regional,
communitarian, and political affiliation. This subtle equilibrium which has created de-facto
stability to the country is permanently threatened by three factors: (a) the inclination to accumulate

54
In the typology of political settlements developed by Brian Levy (2014): Working with the Grain, Niger can be
characterized as personalized-competitive-personal where politics is competitive, but the rules of the game governing
both the polity and the economy remain personalized.
55
BTI, 2016, page 9.
56
In September 2014, the U.S. Department of Defense announced plans to erect a second surveillance hub in Niger,
expanding its use of unarmed drones for intelligence gathering. France, meanwhile, committed an additional 3,000
troops to support ground operations in the region. (International Crisis Group 2015).
57
The important role of traditional leaders is a legacy from the colonial period during with the French colonial
power reinforced the power of certain ethnic groups, notables, religious authorities and traditional leaders to
compensate for its lack of human resources in Niger. This is not specific to Niger as it was common throughout
whole sparsely populated Sahara. The specificity of Niger is that the postcolonial authorities chose to preserve the
power of these traditional authorities.
58
Mueller, L. 2016. “Democratic Revolutionaries or Pocketbook Protesters? The Roots of the 2009–2010 Uprisings
in Niger.” African Affairs 112 (448): 398–420.
59
See for instance Bertelmann Stiftung 2016 (BTI 2016) on how little progress is made in fighting corruption, whereas
at times allegations of corruption or other legal procedings serve to disqualify political opponents.

53
power and resources and to narrow the elite coalition to the point that some of its elites consider
that they do not have sufficient interest to stay in this coalition (as in 2010);60 (b) the inability to
address or adapt to shocks (food crisis, economic downturn) which may lead to internal splits
among the elites and lead some of them to leave the coalition; and (c) a generational conflict in
which an increasingly young population does not feel represented by its leaders. In all instances,
the risk of authoritarian drift is real (to eliminate the discontent voices), and the risk of a (violent)
political crisis never far away.

Box 5.1: The complex developmental role of the army

Though Niger has experienced a number of coups, it would be inappropriate to consider the army as disruptive to
the development process. Coups in Niger are characterized by a high degree of ‘legitimacy’ in which the army
acted as arbiter in political games. In 1996, Ibrahim Baré Mainassara promised a ‘democratic correction’ to solve
the institutional deadlock due to the cohabitation between the presidential and the National Assembly majorities
since 1995. The 1999 coup was carried out by Commandant Wanké, partly to reduce the power of the military, and
indeed, Commandant Wanké respected his commitments to hand over power to civilian authorities. In 2010, Salou
Djibo led a coup against Mamadou Tandja, again to address a situation of extreme political tensions after what was
called a ‘constitutional coup’ by President Tandja himself. For some coups, the motivation of the perpetrators
seemed to be the rebalancing of political forces. This was the case in 1999 and 2010.61 As Niger’s coups appeared
justifiable, almost all were accepted by political actors, civil society, and the international community. In 2010, for
instance, the military coup even enabled Niger to be back on the international scene after the suspension of
European Union cooperation due to Tandja’s governance.
At the same time the army is another member of the elite coalition, which uses its powers to defend its own
(economic) interests. The fact that the army has been part of 40 governments out of 49 between the coups of 1974
and 2002 demonstrates the weight of the institution and suggests that the army is more than a neutral arbiter between
citizens and political leaders.
The recurrent interventions of the army in Niger’s political life suggest a need to depoliticize the armed forces and
to put it firmly under civilian control. On the other hand, in a context where political elites lack legitimacy and are
often incapable of managing socioeconomic and political crises, the army may continue to play a positive
developmental role. 62

111. The limited renewal of the political class is a driver of fragility. The current main
political actors already ran the country in 1991 and the youth do not feel represented. The two last
elections before 2016 demonstrate this, with the lowest voter turnout since 1992. Political apathy
fuels alternative forms of mobilization, especially a religious one that attracts the young population
who are disappointed by formal institutions. The political neutrality of the Nigerien religious
leaders may be explained by a disenchantment with politics in general and the fact that no political
actor matches their expectations in terms of morality. Loss of legitimacy tends to restore the image
of the former, controlling military regime of Seyni Kountche. Both Islamic and authoritarian ways
of governance have in common a perception of being the guarantor of justice, discipline, and order.

112. The fragility of the ruling coalition and its reliance on privileges to sustain the
coalition reduce the quality of public services and the scope for (policy) reform. The logic
underlying the political settlement reduces the scope and success of developmentally oriented

60
Chauzal, Grégory. 2011. Les règles de l’exception : la régulation (du) politique au Mali et au Niger. Institut
d’études politiques de Bordeaux.
61
Ibid.
62
Bryden, Alan, and Boubacar N’Diaye. 2011. Gouvernance du secteur de la sécurité en Afrique de l'Ouest
francophone : bilan et perspectives. Centre pour le contrôle démocratique des forces armées DCAF.

54
policy measures. Discretionary nominations within the administration, for instance, are based on
familial or political connections, which tends to weaken the quality of basic services.63 The award
of public contracts is not based on business criteria, thus inflating cost and reducing the incentive
to develop capacities and skills in the private sector. 64 Local authorities are co-opted because of
their crucial role during electoral campaigns, thus making them upwardly accountable as opposed
to the citizens they serve. Informal trade is not addressed because the traders behind such trade
support the ruling party. This allows illicit trafficking to flourish (see Box 1.1) and reduces state
revenues.

Box 5.2: Religious conservatism and development outcomes

Several very conservative religious organizations have become active in Niger. The two main ones are Jamaat’
Tabligh and Izala. The Jamaat’ Tabligh is a Pakistani Islamic movement created at the beginning of the 20th century
which has spread over the Sahel, including Niger. Izala (Jama’atu Izâlatu-l-bid’awaIqâmatu-s-Sunna) is originally
a Nigerian Islamic association formed in 1978 in Jos from a Wahhabi inspiration. It quickly spread, becoming the
main Salafist movement. Both organizations have in common the condemnation of any form of innovation and a
strict reference to the Sunna. Other local Islamic associations or movements also exist in the country, especially
along the Nigerian border, like the Goungouniyya or the ‘Muslim Brotherhood’.65

Religious conservatism is gaining ground and the Islamization of society and the political sphere is presented as an
alternative to a broken non-confessional state. The movement feeds on popular discontent with the absence of
economic opportunities or the limited legitimacy of the political class.

Increasing conservatism is not directly present in the developmental and political debate as there are no religious
political entrepreneurs. Yet, it is winning influence over the Nigerien political class, compelling politicians to
consult religious leaders (especially during political campaigns). On various public issues, like the organization of
the fashion festival African Fashion International Festival (Festival international de la mode africaine, FIMA) or
the adoption of the African Charter on Human Rights, public authorities were forced to give in to Izala’s pressure.

The increasing presence of intolerant views may weaken the ability to deliver basic services. Consider the case of
the education sector. While the development of (local language) schools could provide an opportunity to spread
education in the most remote areas (as is the case with the Franco-Arab schools which offer a government
curriculum),66 many Koranic schools are not controlled by the administration. Their curriculum is far from being
the official Nigerien education program and almost entirely a zealous one. This is worrisome, because an education
focused on religion leaves little room to learn secular skills adapted to the labor market. Religious education may
also be used to legitimize traditional social and gender habits even though the Islam can be interpreted in a
conservative manner but also in a way that supports notions like equality between both sexes or universal human
rights.

63
See Olivier de Sardan 2014. La Routine des comportements non-observants au sein des services publiques
nigeriens : connaitre la culture bureaucratique pour la reformer de l’intérieur. LASDEL.
64
The cost of such dealings can be very high. The exploitation of the Soraz oil refinery in Zinder for instance was
put at risk due to dubious contracts to sell the refined oil at very low prices to businessmen close to the president. In
turn, the Nigerien Party for Democracy and Socialism (Parti Nigerien pour la Democratie et le Socialisme, PNDS),
the Presidential Party, was sponsored by these businessmen. Eventually, the refinery’s debts had to be settled by the
authorities through a loan of FCFA 437 billion from China Exim Bank.
65
Moulaye Hassane. 2011. "Islam in Niger." In Les Afriques dans le Monde, Dimensions transnationales de l’Islam
africain et mutations contemporaines du Sahel, Etude 8/328, Ministère de la Défense, 2011.
66
For more on the Franco-Arab schools, see: Villalón, Leonardo A., Abdourahmane Idrissa, and Mamadou Bodian.
2012. Religion, demande sociale, et réformes éducatives au Niger. Research Report No. 6. Africa Power and
Politics.

55
 5.3 Consequences of the Political Settlement

113. Catering to elite interest leads to a poor regulatory and institutional environment. A
burdensome regulatory environment in combination with an underdeveloped financial sector
generates a preference for informality among non-elite members as formalization offers few
benefits while being informal allows firms to circumvent the regulatory burden (see Table 5.1).
To elite members, on the other hand, a burdensome regulatory environment offers protection
against competition while its bad consequences can largely be avoided through bribery or the use
of connections.

Table 5.1: High tax rates create incentives for tax evasion and informality
Taxes and duties paid on publicly procured imported goods
ARMP
Import (1%) and Total fees
Good Taxable Customs Value Other
statistics contract and
imported import value duty added tax taxes
fee registratio taxes
n fee (5%)
Servers 132,291,628 6,614,581 1,322,916 27,146,242 24,543,707 7,937,498 67,564,944
5% 1% 21% 19% 6% 51%
Floppy
34,402,471 6,880,494 344,025 8,039,858 7,025,758 2,064,148
discs 24,354,283
20% 1% 23% 20% 6% 71%
CISCO
108,290,918 21,658,184 1,082,909 25,307,588 22,115,438 6,497,455 76,661,574
Switch
20% 1% 23% 20% 6% 71%
Inverter 6,897,114 344,856 68,971 1,415,288 1,279,602 413,827 3,522,544
5% 1% 21% 19% 6% 51%
Source: World Bank 2016.

114. Limited attention to (the quality of) public service provision reflects political
calculations. Resource allocations are inefficient (high levels of leakage), favor large investment
projects, and are uneven distributed, with most public resources being spent in Niamey. An
explanation for this pattern is offered by the selectorate theory which suggests that if it is the
primary goal of a leader to remain in power, s/he must maintain a ‘winning coalition’. When the
winning coalition is small, as in autocracies, the leader will tend to use private goods to maintain
the coalition. When the winning coalition is large, as in democracies, the leader will tend to use
public goods to satisfy the coalition. 67 In the case of Niger, a political settlement in which
traditional, religious, and ethnic leaders have the power to tell the population whom to vote for
(Figure 5.3) offers one explanation why the incumbent prefers to spend on private goods as
opposed to public goods (or on a good preferred by donors such as education for all). To the degree
that public resources are spent, they tend to favor large-scale, highly visible projects such as the
regional railroad, the Kandadji dam, and the power project at Salkadamna that reflect positively
on the leaders rather than on service delivery to the benefit of ordinary citizens. While these
initiatives are all needed, it is telling that other initiatives to reduce transaction costs, such as
increased competition in telecommunication are not embraced.

67
Smith, Alastair, Randolph M. Siverson, and James D. Morrow. 2003. The Logic of Political Survival. Cambridge,
MA: MIT Press. Paperback edition, 2005. (Award for Best Book on Conflict, 2002–2003, Conflict Processes
Section, American Political Science Association.)

56
 Figure 5.3: Empowerment and service delivery
Niger’s largely disempowered and illiterate population… …places a remarkable level of trust in its leaders.
90
7 81
Mean years of schooling 78 Precent expressing a lot of trust in ....
80 73
72
69 70
70 65
62 63
5
60 55 55
4
4 4
50 45 46 46
43 43 44
40 39
38 37
40 35
2 2 29 27 27
2 30 22 22
1 1
20

10

0
Burkina Niger Mali Ethiopia Senegal LDCs Côte Togo SSA Ghana Niger Senegal Burkina Guinea Mali Benin Togo Ghana Cameroon
Faso d'Ivoire Faso
Religious leaders Traditional leaders President

But outside the urban areas, few services are available. Services which are generally of poor quality
44 650
Net secondary education enrollment rate 42 PASEC score 2014
38
600

628

605
550
29
boys

541
500

523

521
girls

514
435

437
21

506
20

503
502
502
500

500
491
450

484
480

475
474

466
15 15

458

455
14 13 14
11 12 400
10 11

5 350
Niger

Niger
Togo

Togo
Benin

Benin
Senegal

Senegal
Average

Burundi

Average

Burundi
Côte d’Ivoire

Côte d’Ivoire
Chad

Chad
Burkina Faso
Congo

Burkina Faso

Congo
Cameroon

Cameroon
Tahoua Tillaberi Maradi Diffa Zinder Dosso Agadez Niamey

language scores math scores

Source: United Nations Development Programme (UNDP) 2015; Afrobarometer 2015; DHS 2012; and PASEC
2015.

115. A patronage-based promotion/demotion system contributes to low civil servant

morale and bureaucratic ineffectiveness. Favoritism and political patronage in appointments
and promotions/demotions are widespread. The most desired positions are subject to an informal
auction, and the political control of the administration by the ruling party is such that some
ministers cannot select their own advisers and directors. The absence of a policy of promotions
based on performance and a high rate of staff rotations undermines the emergence of a stable
technocracy within the administration. Low wages—at least relative to the top-ups that can be
gained by participating in donor-sponsored activities—further reduce incentives for service
delivery in favor of participation in workshops, supervision missions, and so on. Moreover, in the
wake of structural adjustment, as few new civil servants have been hired, a gap has been created
where an experienced middle cadre is largely absent, creating a bureaucracy that has an
experienced top layer with very little ‘depth’.

57
 Figure 5.4: Challenges with service delivery in health facilities
Health facilities present a good illustration of the many existing problems with service delivery. Levels of
absenteeism are extremely high, productivity is low, and the quality of service substandard.
Absenteism and productivity in public and private health Percentage of common diseases correctly diagnosed
facilities 10

Malaria without anemia 79

Malaria with anemia 5

Pulmonary tuberculosis 76
4
Type 2 diabetes 21

Pneunomia 53

Acute diarrhea with severe dehydration 3

33% 31%
Correctly identified disease
Public Private Public Private
Absenteism (%) Patients consulted per staff-day 0 20 40 60 80 100

Source: World Bank. 2016. Service Delivery Indicator Survey.

116. Service delivery by the state thus has a number of common characteristics. First, the
quality of the services is widely condemned by clients, as is the behaviour of state actors, who are
typically criticized for their attitude, lack of competence, or seen as corrupt. Next, the management
of human resources is haphazard at both local and national levels. There is no guiding principle
and countless problems arise which are even criticised by the workers themselves, including
absenteeism, patronage and clientelism, frequent interference, an absence of sanctions, chronic
staff turnover, a lack of transparency, excessive centralization, a refusal to delegate, the failure of
bonuses, inefficiency, the bending of rules, and so on. Despite odd instances of things working as
they should, there appear to be no permanent solutions to these problems. Third, development
organizations are courted by state actors, who see in them bottomless resources. To access donor
funds, a multitude of strategies are explored: development brokering, financial handouts, brain
drain, doublespeak, quests for daily expense allowances through the creation of ever more training
courses and workshops, opportunities for local reform, and so on. 68

Box 5.2: Governance and the quality of statistics

The SCD draws heavily on data to arrive at its conclusions. Much of these data have been provided by Niger’s
National Institute of Statistics (Institut National de la Statistique, INS), which is semiautonomous and placed under
the ‘tutelle’ of the Ministry of Finance. The director general is appointed by the minister of Finance. The institute
is affected by many of the governance problems reflected in this chapter: limited capacity of staff, a misalignment
of incentives, little attention to quality, and a distortionary influence of funding by donors.
According to the Statistical Capacity Building Indicator, statistical capacity in Niger exceeds the average capacity
in the subregion (71.1 versus 59.9). Also, with respect to access to data Niger performs relatively well. 69 This does
not mean that data quality is acceptable. Data are archived, but 44 out of 97 data sets in the archive cannot be
accessed. Certain reports can be downloaded but rarely are they up to date. For instance, in November 2016 the
most recent national accounts that could be downloaded were provisional for 2014 and final for 2012. Certain
methodologies are outdated such as the one for the national accounts which still uses the SNA 1993. Up-to-date
anonymized micro-data are not made public without prior authorization. The most recent survey for which micro-

68
Jean-Pierre Olivier de Sardan. "The Delivery State in Africa. Interface Bureaucrats, Professional Cultures and the
Bureaucratic Mode of Governance.”
69
Hoogeveen, and Nguyen. 2016. “Statistics Reform in Africa. Aligning Incentives with Results.” Mimeo.

58
 data could be downloaded dates from 2010; the most recent data that could be downloaded with prior authorization
dates from 2015. Some administrative data are accessible through DEVINFO but what is offered is outdated and
of low quality, putting the usability of the information in question. For instance, information on the production of
paddy crops accessed in November 2016 dates from 2010 and shows that production was 1,040,000 tons in 2009
and 29.961 tons in 2010.
Survey data are possibly the most reliable data that are provided. Many surveys have been done: DHS and MICS
surveys are implemented every three or four years. Niger implements a household vulnerability survey almost every
year and has carried out living conditions surveys almost every three years. These latter surveys suffer from two
fundamental quality issues. First, they are not comparable over time as rarely are the same methodologies and
design used. As a consequence, official poverty numbers are not comparable, making it hard to draw conclusions
about poverty trends (for the SCD, poverty estimates were redone to ensure comparability). Second, most welfare
surveys are not comprehensive enough to allow performance evaluation of government programs. For instance it
has proved very difficult with the data available to explain in detail the reasons behind the observed reduction in
poverty. Recently with the arrival of the LSMS-ISA and harmonized WAEMU welfare surveys, these aspects are
being addressed.
Inadequate core funding hinders the efficiency of statistical operations and creates a dependence on ad hoc donor
funding. Most of the institutional budget that INS receives is allocated to salaries and wages, leaving little
discretionary resources for field operations or methodological renewal. High per diems create perverse incentives
to collect field data as opposed to using administrative data. They also lead to inflated sample sizes and
consequently unnecessarily high cost for data. Staff prefer to avoid data analysis and report writing unless this is
done off-site and eligible for per diems. Discretionary power of managers to allocate staff to per diem-generating
activities creates a culture of unquestioned loyalty with limited incentives to question data quality, procedures, or
the efficiency of operations.
Weak technical capacity, limited funding, and semi-autonomy limit the independence of the INS and the confidence
one can have in the data produced.

5.4 The Challenge of Reform

117. The low capacity of the administration, the difficulties with frontline service delivery,
and a competitive political settlement limit the scope for rapid improvements in economic
governance. By design, that is, to appease multiple power brokers, the administration is highly
fragmented as evidenced by the large number of line ministries (there are 42 ministers and 4
ministries that deal with education), the large number of cross-sectoral committees, and high
number of advisers (more than 150 special advisers at the Prime Minister’s Office alone).
Institutional fragmentation and overlapping responsibilities lead to conflicting decisions, lack of
accountability, policy indiscipline, and poor cohesiveness which hinders steadfast, consistent, and
effective actions. It thus constitutes a major obstacle to integrated actions, especially in the area of
structural reforms and service delivery.

118. The challenge of reforming PFM is well be illustrated in a study below prepared for
the High Commission for the Modernization of the State.70 The study presents the experience
of researchers of the Laboratory of Studies and Research on Social Dynamics and Local
Development (Laboratoire d'études et recherches sur les dynamiques Sociales et le
Développement Local, LASDEL) regarding the introduction of a training program at the Treasury.
It points towards the need to increase the numbers of staff and their quality. The study reflects the
lack of a professional culture (people arriving late; meetings without agendas) and how

70
HCME (High Commission for the Modernization of the State). 2015. Le fonctionnement de la Direction générale
du trésor et de la comptabilité publique.

59
opportunities for per diems shape the discussion (who should benefit). The study points towards
other aspects that hinder an optimal functioning of the Treasury, including a generational divide,
lack of money for operating expenses, and corruption. Researchers found that relations between
young and old staff were strained, for instance. To the older staff, the young lack skills and know-
how. Younger staff, by contrast, deplore the selfishness and mediocrity of the old and consider
themselves as reformists. They also noted the poor physical working conditions, the scarcity of
basic office supplies, and a professional culture of influence peddling and corrupt profiteering. The
latter is brought about, in the case of the Treasury, by the state coffers being almost permanently
empty and the Treasury having to make choices regarding which suppliers get paid, a decision that
is influenced by the presentation of gifts or kickbacks.

119. The challenges highlighted in this study are in no way specific to the Treasury; they
exist systematically across the public service. It illustrates the scope of the problem and points
toward the need for a major effort and significant political commitment to change the existing
situation.

120. As reforms stall and Niger’s governance indicators remain poor and levels of
corruption elevated, the country fits the description of a limited access order.71 Limited access
orders can be described as political settlements in which an (relatively small) elite group of
politicians (including traditional leaders), businessmen, and those in charge of the means of
violence (police, military) provide stability to a country in return for access to rents. Even though
the outcome is a situation with high levels of corruption, occasional violence and upheaval, and
limited development, this outcome is generally more acceptable (even though unjust) to the
population than a state of generalized violence, which would be the alternative. A limited access
order is characterized by personalized (as opposed to anonymous) relations. People are not equal
before the law and institutions depend on personalities and are not long-lived: connection matters
more for outcomes than merit.

121. The internal logic of a limited access order requires that policies and reforms aimed
at reducing poverty are such that their likelihood of success is much greater if they also
benefit the elite. This has practical consequences for the selection of projects: an irrigation project
benefitting elite members but creating job opportunities for the poor and reducing food prices may
be more likely to succeed, and ultimately have a greater impact on poverty, than an approach that
bypasses the elite, for instance, by targeting the poorest directly—unless the elite can use the
support to buy loyalty. Such approaches may turn out to be unsustainable, for instance, because
the most vulnerable are pushed out of their land. This topic is discussed again in the next section
when discussing the identification of priority actions.

122. Implications of this governance assessment are far-reaching. It should not be concluded
from all the challenges listed above that state mechanisms are governed wholly by rationales based
on privilege, clientelism, or corruption. Rationales based on competence or merit have not
disappeared from the administration, but it does suggest the presence of structural institutional
obstacles to the adoption of pro-poor policies. Improvements are feasible but are likely to come
incrementally and require a combination of approaches, including a sustained (rather than a big-
71
North, Douglass C., John Joseph Wallis, Steven B. Webb, and Barry R. Weingast. 2007. “Limited Access Orders
in the Developing World: A New Approach to the Problems of Development.” Policy Research Working Paper
4359, World Bank, Washington, DC.

60
bang) effort to raise the capacity of bureaucrats. Once trained, they can form islands of
effectiveness and address policy and institutional constraints in an opportunistic manner by
forming coalitions with reform-minded stakeholders (thus benefitting from the competitive
character of the political settlement). Such islands of effectiveness could be established in the
central administration and at the decentralized or municipal levels.

123. As governance reforms will take time, more direct support to citizens is an important
complementary building block to any governance strategy. More support directly delivered to
citizens is likely to be an effective poverty reduction tool than working through a system with
weak capacity and high levels of leakage. An approach that targets citizens more directly and pays
more attention to financing results, as opposed to inputs, offers promise. It strengthens local
initiatives and decision making, increases local incomes and autonomy, enhances access to
information, and embraces service delivery by whoever is capable of doing so. Such an approach
would enhance ownership, a precondition for sustainability and move the focus of decision makers
and development agencies away from a centralized, state-led development model. Moreover, as
purchasing power would increasingly be moved away from the center, it would provide incentives
to private sector operators and elites to invest in rural areas.

124. Donors will need to reduce the distortionary effects of their presence and pay more
attention to governance details. In many ways the environment is stacked against donors who
know the environment less well. At times, simply paying more attention to detail would suffice.
For instance, the 5 percent registration fee that is paid for every publicly procured contract (Table
5.1) is de facto a tax on spending by donors who purchase their goods through public procurement
processes. Yet, instead of paying a 5 percent registration fee, revenue collection would be
simplified and made more transparent when the Treasury was funded through budget support
rather than through a 5 percent tax on all project spending. At times, donors may have to reconsider
some of their policies. Per diems paid by donors are highly distortionary, for instance, and at other
times, the mere presence of donors is the problem. The public service has derisory rates of pay and
third-class privileges; the aid sector has rates in line with international standards and first-class
privileges. The upshot is that the public service is losing out to development agencies. This goes a
long way toward explaining the internal ‘brain drain’ inside Niger, that is, the poaching of the best
managers in the public service by development agencies and international organizations. Per diems
paid for donor activities are hugely distortionary.

61
6. Identifying and Prioritizing Pathways to Poverty Reduction
6.1 The Challenge of Reducing Poverty in Niger

125. Rapid poverty reduction can be achieved but requires higher levels of growth and
more inclusive growth. Moderate consumption inequality suggests that despite high poverty
incidence, the average distance to the poverty line is not too far in Niger. As the poverty to growth
elasticity is relatively high (Section 2.1), rapid progress on poverty reduction could be achieved
through inclusive growth. The potential to reduce poverty through inclusive growth is
demonstrated in Figure 6.1, which simulates poverty under three growth scenarios. The first
scenario takes the growth rate of the poorest 40 percent of the population achieved over the past
decade as point of departure. This growth rate was 0.4 percent, much less than the growth rate
attained by the better-off (2.7 percent). The other two scenarios assume higher growth rates of the
poorest households, respectively, 1.4 percent and 2.4 percent. The figure shows that under the
baseline scenario, poverty headcount declines barely to about 39 percent by 2030. In the other two
scenario’s poverty declines to respectively 31 or 16 percent by 2030. It demonstrates that to reduce
poverty, a significant pro-poor growth effort is needed. To be inclusive a structure of growth
should be sought which differs from that of the past (driven by investments in extractives and large
scale infrastructure), or at least, a structure that stimulates growth amongst the poor.

Figure 6.1: Past per capita consumption growth (2005–2014) and simulations of the change in US$1.9 PPP
poverty under different future growth scenarios (2015–2030)
Without strong growth for the bottom 40 percent, poverty eradication by 2030 would be impossible. But growth
in combination with income transfers can eliminate poverty (in brackets are the transfers needed expressed as
percent of GDP)
Real per capita consumption growth (%, 2005–2014) Poverty projections and GDP required in
perfectly targeted transfers to eliminate poverty
(%)
50
3 2 44 (12.0%)
3 2 40 39 (8.5%)

2 30 31 (5%)

2 20
16 (2%)
1
10
0
1
0
0 2014 2018 2022 2026 2030
Top 60 Bottom 40 Mean 0.4% growth 1.4% growth 2.4% growh

Source: Authors’ calculations using QUIBB 2005 and LSMS-ISA 2011 and 2014.
Note: Poverty rates are based on a per capita consumption welfare measure from LSMS-ISA 2014 and the US$1.90-
a-day poverty line (2011 PPP). The simulations above follow the methodology of Lakner, Negre, and Prydz (2014).
Twinning the Goals: How Can Promoting Shared Prosperity Help to Reduce Global Poverty? World Bank Policy
Research Working Paper No. 7106.

126. If redistribution complements pro-poor economic growth, eliminating poverty by

2030 becomes feasible. The scenarios presented in Figure 6.1 demonstrate that under the baseline
scenario of 0.4 percent growth for the poor, a redistribution of about 8.5 percent of GDP (about
the same amount as Niger receives in aid) in perfectly targeted transfers would be required to
eradicate poverty in 2030. With pro-poor per capita growth of 1.4 percent this drops to 5 percent

62
of GDP. If growth accelerates to 2.4 percent for the poorest, a surprisingly small amount in
transfers is needed to completely eliminate poverty: approximately 2 percent of GDP (the
equivalent of what is given in tax exemptions) or CFAF 33,000 per poor person.

127. Apart from improvements in the business environment and public sector governance,
which would immediately increase productivity and opportunities for growth and poverty
reduction, the most promising approach to sustainable growth and poverty reduction is
through a process of classical structural transformation. This process starts by increasing the
productivity of agriculture (food staples in particular) and livestock rearing. Increases in
agricultural production help suppress (fluctuations in) food prices, which is good for the poorest.
Not only do poor households spend a large fraction of their budget on food, the poorest farmers
tend to be net food buyers, often selling crops when prices are low and buying food when prices
are high. Once the share of food consumers relative to food producers grows (because of rural-to-
urban migration), markets become more important, the nonfarm and agribusiness sectors grow,
and the food value chain and rural-urban linkages are strengthened. As rural incomes grow and
price fluctuations diminish, second-order effects are likely to emerge: the stock of human and
physical capital increases as households invest part of their increased incomes in their offspring.
This leads to further productivity gains and to out-migration of (now better-) educated people. It
also unlocks demographic transition, in part because higher incomes and higher levels of education
induce women to marry later, while increased irrigation reduces exposure to weather shocks and
increased mechanization reduces reliance on family labor. Improving the productivity of
agriculture is also an excellent way to increase the nonagricultural income earning opportunities
due to its upstream and downstream production linkages. Agricultural development thus generates
a virtuous cycle in which the expansion of agriculture fuels nonfarm sector growth, and vice-versa.

128. The relation between increases in productivity, structural transformation, and

poverty reduction is reflected in the analytical framework presented in Figure 6.2. The
framework is based on the premise that reducing poverty requires income growth among the poor
to alleviate the budget constraint of poor households. One way in which ‘real’ income increases is
when the price of food staples declines, for instance following a good harvest. The real income
constraint can also be alleviated by increasing the productivity of self-employed households. Most
poor households in Niger fit this category, as they are engaged in own-account farming or in
(in)formal off-farm businesses.72 Other ways to ease the income constraint is through wage labor
or by redistributing incomes (transfers). The scope for transfers to contribute to poverty reduction
is considerable, as demonstrated above.

129. Structural transformation can be summarized as the process by which people shift
from low productivity activities to higher productivity activities. It is captured in the
framework of Figure 6.2 through arrows indicating intra-sectoral shifts to higher productivity
activities (for example, by adopting improved seeds or investing in irrigation) and inter-sectoral
shifts such as from an informal self-employed activity to a paid and formal one. In many instances,

72
Presently price elasticities are such that increases in production lead to lower prices, but higher revenue for rural
households (see Box 2.2). When production increases a lot a consistently – for instance because of irrigation at scale,
it is critical that new markets are served. Indeed, the CGE analysis has found that the scenario most supportive of
poverty reduction is a combination of production increases and trade liberalization.

63
inter-sectoral structural transformation is associated with migration as people move from rural to
urban areas.

130. Figure 6.2 also presents factors critical to assuring a decent rate of return to
investments (productivity). Increasing productivity has immediate consequences for poverty
reduction as incomes grow because of increased efficiency and for future poverty reduction as the
process of structural transformation is facilitated by a more conducive business and institutional
environment. Factors that are critical for productivity are risk, population, and governance. Risk
reflects not only largely weather-related risks (rainfall, prices) but also risks to the capacity to work
such as health shocks (or insecurity). Population reflects the challenges posed by rapid population
increases (such as the depletion of soil fertility) and the presence of gender relations that prohibit
women from fully participating in the economy. Governance captures the institutional
environment which determines whether people can appropriate the fruits of their labor and
coordinate their actions effectively. It includes the security, political stability and PFM, issues
discussed in Chapter 5 but also macro-economic governance and the business environment
covered in Chapter 4.

Figure 6.2: Analytical framework for poverty reduction

Note: Arrows reflect the main processes of structural transformation, whether within a productive sector or between
them.

64
131. Niger’s structural transformation challenge can be illustrated by comparing the
characteristics of jobs of the self-employed in agriculture (81 percent of all jobs) with those
in paid jobs in the formal sector. Jobs in agriculture tend to be ‘bad’ jobs: returns are low, rarely
are they permanent, underemployment is high as is the fraction of people with a secondary job
(Table 6.1). The reverse holds for the wage employed. Though they are few in number, their jobs
are of much better quality, being mostly permanent, with limited underemployment and often
being formal. People engaged in wage employment are also much more likely to receive health
benefits. Therefore, to reduce poverty it would be desirable if many more people became engaged
in wage employment. At the same time, it is unlikely that a sector that presently employs some 4
percent of the population will be able to absorb the 81 percent that are currently primarily engaged
in agriculture.

Table 6.1: Illustrating the structural transformation challenge and job characteristics
Agriculture Nonagricuture self-employed Wage employed
Total employed (number) 4,885,242 892,857 248,740
(Percentage) 81% 15% 4%

Permanent 13.2% 52.3% 76.6%

For a specific period 33.8% 26.5% 17.7%
Seasonal 53.0% 21.1% 5.7%

Median monthly earnings (*) 5,968 18,000 62,000

Formal 0.4% 2.2% 48.3%
Informal 99.6% 97.9% 51.7%
Underemployed 59.6% 45.8% 26.2%
Has secondary job 28.6% 15.6% 10.8%
Receives health benefits 0.3% 0.4% 31.6%
Source: World Bank. 2016. Jobs Assessment in Niger.
Note: * Excludes those (family workers mostly) earning no income. Incomes expressed in CFAF.

132. The likelihood that the formal sector will absorb any surplus agricultural labor in the
short run is reduced by the small size of the domestic economy and the lack of ‘savoir faire’
embedded in the economy. Apart from the overarching need to improve the business
environment, prospects for the development of a labor-intensive manufacturing sector are hindered
by the small size of the domestic market. Export opportunities to Nigeria—the biggest market in
the region—exist but the demand is primarily for horticultural and livestock products. Developing
exports of manufactured products is not straightforward as the current industrial base is tiny and
lacks the necessary networks of suppliers and buyers and the skills needed to develop an export
sector. This is confirmed by Hausmann and Klinger (2006) and Hidalgo et al. (2007)73 and an
analysis done by the International Finance Corporation (IFC) for this SCD. These authors use the
product space concept to show that Niger’s exports are relatively unconnected to other products in
the global product space. It makes successful export promotion of non-primary goods particularly
difficult as it suggests that the knowledge embedded in the economy (exports of unprocessed goods

73
See Hausmann and Klinger (2006). Structural Transformation and Patterns of Comparative Advantage in the
Product Space downloadable from http://ksgnotes1.harvard.edu/Research/wpaper.nsf/rwp/RWP06-041 and Hidalgo
et al. (2007) The Product Space Conditions the Development of Nations. Science 317, 482 (2007); DOI:
10.1126/science.1144581.

65
and minerals) is far from what is needed for successful development of other tradeable good
sectors.

133. Improving the productivity in agriculture therefore remains a first priority for
poverty reduction. The CGE model presented in Chapter 4 already demonstrated that improving
the productivity of capital in the agricultural sector would boost the incomes of the poorest 50
percent of the population. When such investments are combined with trade facilitation, the positive
impact is particularly high. It supports the notion that improvements in on farm productivity should
be combined with improved market access. Other evidence on the importance of agricultural
growth for poverty reduction can be gleaned from past reductions in poverty. Niger reduced
poverty by 9 percentage points since 2001 and by more than 4 percentage points between 2011
and 2014. This reduction is largely due to intra-sectoral effects, particularly positive growth in
agricultural and livestock production in rural areas where most of the poor live. In the next section,
we explore the scope for poverty reduction by raising productivity in agriculture.

6.2 Reducing Poverty by Increasing Productivity of Agriculture

134. Biophysical conditions and weather variability pose major constraints to agricultural
productivity. Agricultural productivity is limited by a short rainy season with high intra- and inter-
annual variability in rainfall, which often leads to crop failure. Moreover, land quality is low
because of the limited soil organic matter content.74 Because of this, the soil tends to crust, which
hampers water infiltration and causes extensive water runoff, leading to flash floods in the event
of heavy rains, and further losses in soil fertility.75 Additional risks to agricultural productivity
include locusts, crop or livestock disease outbreaks, and sandstorms.76

135. Climate change is likely to worsen the biophysical conitions. Climate models predict a
further increase in weather variability and more occurrences of extreme weather. They project an
increase of 1.6°C in mean annual temperatures by 2049, an increase in the intensity and frequency
of droughts, and more intense rainfalls. A rise in the incidence of extremely hot days will cause
additional heat stress to crops and livestock. The 2009 drought (which was compounded by a locust
infestation) led to a 4 percent decline in per capita GDP and a decline of more than 13 percent in
agricultural production. 77 The impact on the livestock and herding subsector was stark as 2.7
million head of livestock perished. The herding sector suffered losses of approximately US$805
million (almost 30 percent of GDP).78

Figure 6.3: Yield gap and input use

The yield gap for the most commonly grown crops is Low yields can be attributed to the limited use of
enormous. improved seeds...

74
Breman, H., J. J. R. Groot, and H. van Keulen. 2001. “Resource Limitations in Sahelian Agriculture.” Global
Environmental Change 11: 59–68.
75
World Vision Niger. 2009. Agricultural Development Recommendations.
76
Government of Niger. 2010. Strategic Program for Climate Resilience Niger (SPCR).
77
World Bank. 2007. Niger - Accelerating Growth and Achieving the Millennium Development Goals: Diagnosis
and the Policy Agenda. Report No. 41408-NE.
78
Republic of Niger. 2011. Evaluation rapide de l’impact de la crise pastorale 2009-2010 sur la décapitalisation du
cheptel et les moyens de subsistance des populations pastorales et agro-pastorales du Niger. Preliminary Report.

66
 10 Yield gap 9 Percent of household using improved seed variety
9
8 100
90
7 80
5
Tons / hectare

6 70
4
60
5 4 50
4 40
3 30
13
20
2 5 3
10 1 1 1 1 1 1 1
1 0 0 0
Millet Sorghum Rice Cowpea Groundnut
0
Rainfed sorghum Rainfed millet Irrigated rice
Actual yield Potential yield Percent of households Area cultivated

…as well as the limited use of fertilizer, which is much With respect to the use of animal traction and reliance
lower than comparators in Africa. (*) on irrigation, Niger’s performance is comparable to
other countries in Africa.
Inorganic fertilizer use (kg/ha) Animal traction and irrigation
350
310
90 79
300
80

250 228 70
60
189
200 50
149 37
40 30
150
30 19 22
96
100 81 20
60 61 6 8
10 2 4 3 3
38 0
50 26
9 0
4
Niger Ethiopia Malawi Nigeria Tanzania Uganda
0
Niger Ethiopia Malawi Nigeria Tanzania Uganda
Median Mean % households with traction animals % households with at least some irrigation on farm

(*) Note: There are many more explanations for the presence of a yield gap, including farrming practices, market
access, availability of storage or the policy environment.
Source: Yield gap, Gyga Niger, 2016; other information: Sheahan, Megan, and Chris Barret. 2015. “Understanding
the Agricultural Input Landscape in Sub-Saharan Africa.” Policy Research Working Paper 7014, World Bank,
Washington, DC.

136. To increase productivity in agriculture, the yield gap needs to be reduced.79

Particularly, yields for traditional cereals need to be improved. For the most popular cereal crops—
sorghum, millet, and rice—the difference between actual yields and potential yields is huge. For
rain-fed sorghum, yields could increase by almost a factor of 20 and for rain-fed millet, by a factor
of 8. The potential increase for irrigated rice is less, but still at least a factor of two.80 Even if only

79
The yield gap is particularly large for women. Women farmers who produce 19 percent less per hectare than men,
with the gender gap rising to 66 percent after controlling for differences in plot size and region. The primary factors
that contribute to the gender productivity gap are (a) farm labor, with women facing significant challenges in
accessing, using, and supervising male farm labor; (b) the quantity and quality of fertilizer use, with men using more
inorganic fertilizer per hectare than women; and (c) land ownership and characteristics, with men owning more land
and enjoying higher returns to ownership than women (Backiny-Yetna and McGee 2015). Another element of
women’s relative lack of empowerment that affects their agricultural productivity is their relatively lower
participation in leadership outside the household, as measured by group membership and public speaking (Wouterse
2016).
80
Numbers vary by source: FAOSTAT reports, for instance, yields for millet of 544 kg/ha and 442 kg/ha for
sorghum, while the Global Yield Atlas puts the yield potential at 1.2 t/ha for rain-fed millet and of 3.3 t/ha for rain-
fed sorghum. Irrespective of the source, the yield gap is very large.

67
half of the potential yield is attained, it would imply a quadrupling of millet yields per hectare and
an almost 10-fold increase in sorghum production!

137. There exists great potential for irrigation using groundwater. Whereas estimates
indicate that some 16,000 ha of land is currently irrigated using groundwater,81 available
information derived from a recent mapping of groundwater in Niger 82 suggests that at the very
least 250,000 ha is easily irrigable.83 The number of wadis (dry rivers) where sand dams (seuils
d’épandage) can be constructed to stop erosion and recharge groundwater is also very high. A
back-of-the-envelope calculation suggests that if this 250,000 ha were irrigated and yields of 6,000
kg of rice would be obtained for two harvests a year, 48 million exclusively rice-eating people
could be sustained. 84 The implication is that with adequate technological change a Malthusian
crisis—because of high population growth and dwindling access to fertile land—can be avoided,
at least in the short run. Affordable, small-scale solutions for irrigation with groundwater exist:
plots of 2,500 m2 can be irrigated using a portable solar pump presently marketed in Kenya for
approximately US$500. If such solutions were to be introduced at scale, there would be general
equilibrium effects. Prices could drop for instance which despite increased production could have
a negative impact on farmer income. Such a drop in income could be avoided if an irrigation
policy is accompanied by a market access (export) strategy and/or the development of new value
chains. In that scenario, the (now lower) decine in prices and increased demand for wage labor
would be very beneficial for poor people who as net food buyers would benefit from lower prices
and as providers of casual labor would benefit from increased demand for their services.

138. Other ways need to be found to increase the productivity of rain-fed cereal crops.
Barring rice, most cereals are not grown under irrigated conditions. The scope to increase the yields
of traditional cereals of millet, sorghum and cowpeas is enormous. Among the many reasons for
low yields, the immediate causes are the limited reliance on improved (let alone hybrid) seed;
limited use of inputs (fertilizer, pesticide); and inadequate use of technology (see Box 6.1). Some
of the reasons for the limited uptake are attributable to agro-ecological variables, but Sheahan and
Barret (2014)85 point out that most of the variation in the use of inorganic fertilizer and agro-
chemicals are attributable to national-scale variables, that is, market regulating policies.

81
Abric, S., Sonou, M., Augeard, B., Onimus, F., Durlin, D., Soumaila, A., & Gadelle, F. (2011). Lessons learned in the
development of smallholder private irrigation for high- value crops in West Africa. Washington, DC: World Bank.
82
That is, the water table is at less than 10 m below the surface, a depth that allows the use of surface pumps, the
porosity of aquifers is high enough, the land above the aquifer is suitable to agriculture (slopes and soil quality), a
manually constructed borehole is feasible, and people live in the area.
83
The EPTIN assessment of groundwater carried out by the Ministry of Agriculture in 2015 calculates over 5
million ha with water table higher than 15 m, based on slopes, land quality, and terrain topography, which are some
of the criteria.
84
Based on 374 calories per 100 gram of dry rice and total caloric needs of 2,100 calories per day per adult. Solar
pump specifications and cost (Practica: http://practica.org/projects/introduction-solar-irrigation-pumps/).
85
Sheahan, Megan, and Chris Barret. 2015. “Understanding the Agricultural Input Landscape in Sub-Saharan Africa.”
Policy Research Working Paper 7014, World Bank, Washington, DC.

68
 Box 6.1: Climate-smart agriculture practices can foster productivity in agriculture
The research community has identified ample climate-smart agriculture practices that can foster productivity and
deliver sizeable resilience benefits at the same time. The challenge is to ensure these practices are adopted.
Interventions such as the introduction of more drought and heat-tolerant crop varieties, soil and water conservation,
rainwater harvesting, or conservation agriculture can reduce the vulnerability of smallholders practicing rain-fed
agriculture and enhance the productivity of key staples such as sorghum, millet, and maize.
Soil and water conservation practices such as the construction of small dams, stone contour ridges, or terraces
reduce water runoff and allow for better water infiltration, thereby increasing soil water content and maintaining
humidity during dry spells through an improved soil structure.
Rainwater harvesting practices such as planting pits or earthen trenches along slopes are low-cost measures that
capture and collect rainfall before it runs off farm fields. In Burkina Faso, farmers have doubled grain yields using
multiple water harvesting techniques.
Conservation agriculture is a combination of reduced tillage, the retention of crop residues or maintenance of
cover crops, and crop rotation or diversification. In Zambia, maize yields in conservation agriculture systems with
crop rotation were more than 50 percent higher than yields under conventionally tilled maize. Notably, for different
household types, different adaptation strategies may be climate smart. The selection of the appropriate land use
practice has been shown to depend on land size and market orientation of the farming household.
Climate-smart fertilization strategies are another effective way to restore or maintain soil fertility in Niger and
hence to foster agricultural productivity. The application of mineral fertilizer increases yields, allowing farmers to
build up food and/or financial reserves. Since rural households in Niger often lack access and/or the financial
resources to afford fertilizer, climate-smart strategies such as integrated soil fertility management, micro-dosing,
or precision manuring may be low-cost, effective measures to increase soil fertility.
Integrated soil fertility management (ISFM) is the combined use of judicious amounts of mineral fertilizers and
soil amendments such as crop residues, manure, leaf litter, or compost. The adoption of ISFM across more than
200,000 ha in West Africa increased yields by 33–58 percent over four years, with revenue from maize increasing
by 179 percent. When ISFM practices were combined with the targeted application of small quantities of fertilizer
(micro-dosing) and improved seed varieties, farmers in Mali, Burkina Faso, and Niger experienced increases in
sorghum and millet yields of 44–120 percent, along with an increase in family incomes of 50–130 percent.86
Precision manuring relates to the rotation of the night-time tethering sites of livestock on cropped areas. In so
doing, agro-pastoralists can concentrate manure.
Adding trees to crop or agro-pastoral systems, through plantation or farmer-managed regeneration of naturally
occurring tree species, increases yields and household income. Another land use strategy that has proven to increase
soil fertility substantially is the integration of leguminous ‘fertilizer trees’ into farmland. These trees fix nitrogen
in the soil, provide shade, and improve water infiltration. 87 Consequently, ‘islands of fertility’ are created under
their canopies, that is, areas of greater soil organic matter, nitrogen, and phosphorus concentrations compared to
open areas.
Source: Adapted from: Moussa, et al. 2016. “Economics of Land Degradation and Improvement in Niger.” In
Economics of Land Degradation - A Global Assessment for Sustainable Development, edited by Ephraim Nkonya
and Joachim von Braun.

139. Critical to the introduction of improved farming technologies is extension. The gap
between what is achieved in controlled environments or in small pilots or on the farms of the
majority of farmers is enormous. Whereas most of the needed technologies and knowledge exist,
farmers do not adopt these, in large part because the missing link—extension services—barely

86
Robert Winterbottom, Chris Reij, Debbus Garrity, Jerry Glover, Debbie Hellums, Mike McGahuey and Sara
Scherr 2013. “Improving Land and Water Management.” World Resources Institute.
87
WRI (World Resource Institute). 2015. Scaling up Regreening: Six Steps to Success.

69
exists. Existing extension services are of low quality, top down, and with limited involvement of
farmers as well as the private sector. 88

140. Given the importance of livestock for pastoralists and agro-pastoralists, increasing
the productivity of animal production is critical. Livestock are a cornerstone of the livelihood
systems in Niger which increase household resilience and help make marginalized areas
economically productive. 89 But these systems are also dependent on scarce water resources and
vegetation and suffer not only from increasingly extreme rainfall also severe droughts which are
likely to become more frequent and intense with climate change. The timing and magnitude of
adverse weather spells determine the mobility strategy, the size and composition of the surviving
herd90, and, thus, their ability to recover. Progressive land degradation and water scarcity exert
pressure on grazing areas and existing water points, causing livestock death and hence increasing
the vulnerability of livestock keepers. 91 Conflicts with sedentary farmers can occur when herds are
brought to the southern higher rainfall areas in which agriculture is predominant 92 or as a
consequence of an ongoing northward expansion of farmland into pastoralist areas due to a
saturation of areas suitable for farming. 93 Avoiding further reduction and fragmentation of grazing
lands and other communal resources such as livestock corridors are not only crucial for the
resilience of pastoralist livelihoods but also for the maintenance of an already strained natural
resource base.

141. The transhumant pastoral system is not going to transform into a modern high
productivity sedentary one but the traditional livestock system can be made more productive
and resilient through investments in improved infrastructure and climate-smart land
management. Strategic and productivity-enhancing interventions in the livestock sector could
foster the resilience of livestock keepers and their cattle and boost incomes at the same time.
Interventions could entail the provision of animal health services and in particular veterinary
treatments and vaccination against priority livestock diseases, secured access to grazing areas and
water points,94 and secured access to livestock corridors to allow for the transborder movement of
livestock.95 Seeding rangelands or restoring degraded land improves ground cover and feed
availability, improves soil water retention, and buffers the impact of flash floods from heavy

88
République du Niger, and FAO (Food and Agriculture Organization). 2009. Analyse diagnostique du système
d’appui conseil. Mise en place d’un dispositif intégré d’appui conseil pour le développement rural au Niger.
89
See World Bank 2016. Confronting Drought in Africa’s Drylands Opportunities for Enhancing Resilience.
http://hdl.handle.net/10986/23576.
90
Already for instance, the composition of herds is shifting from large ruminants to small ruminants who have a
shorter life span and who yield a quicker return as compared to large ruminants.
91
Grigg, N., et al. 2015. Resilience Assessment Desktop Case Studies in Thailand and Niger. Australia: CSIRO.
92
Thébaud, B., and S. Batterbury. 2001. “Sahel Pastoralists: Opportunism, Struggle, Conflict and Negotiation. A
Case Study from Eastern Niger.” Global Environmental Change 11: 69–78.
Nori, M., M. Taylor, and A. Sensi. 2008. “Browsing on Fences. Pastoral Land Rights, Livelihoods and Adaptation
to Climate Change.” IIED Issue Paper 148, International Institute for Environment and Development, London,
United Kingdom.
93
Mortimore, M. J., and W. M. Adams. 2001. “Farmer Adaptation, Change and ‘Crisis’ in the Sahel.” Global
Environmental Change 11: 49–57.
94
World Bank. 2016. Confronting Drought in Africa’s Drylands.
IRIN (Integrated Regional Information Networks). 2012. Drought Does Not Mean Death of Pastoralism.
95
For example, BRACED.

70
rains.96 In drought periods, interventions could entail the promotion of early livestock destocking
as well as the expansion of livestock feed supplementation. 97

142. Simultaneously the development of value chains for livestock products with
investments in sedentary livestock and the production of livestock feed and the support of
professional pastoral organizations could be viable options to develop the livestock sector. 98
Policy attention should particularly go to supporting the productivity of small ruminants and birds,
the animals most frequently owned by the poorest.

6.3 Complementary Pathways to Reducing Poverty

143. In addition to increasing productivity in agriculture as a means to start a process of

economic transformation and poverty reduction, this section considers two complementary
pathways to poverty reduction. The first is migration and urbanization, a process that
accompanies inter-sectoral structural transformation, particularly when rural folks move to town.
The second is the promotion of the mining sector which can offer employment opportunities and
revenues needed to finance poverty alleviation-related activities.

Figure 6.4: Economic opportunities associated with migration

At present, urbanization rates are low (19%) as are remittances, but with increasing pressure on land and larger
differentials between rural and urban areas in incomes and access to services, migration can be expected to
increase.
Projected rural and urban population Remittances received in US$ per capita

40 120 113

35
100
30 8

25 6 80 73

20 4
60 54
3 51
15
26
10 22 40
18 28
15 22
5 17
20
7
-
2015 2020 2025 2030
0
Benin Burkina Cote Ghana Mali Niger Nigeria Togo
rural population urban population Faso d'Ivoire

Source: World Bank 2016, Migration and Remittances data; UN 2016. Population projections.

144. Migration, whether international or rural to urban, is potentially a major driver of

growth and poverty reduction. Niger is barely urbanized but cities play an important role in the
livelihoods of the poor as places where employment opportunities can be found in the off-season.
It is estimated for instance that during the dry season and during droughts the population of Niamey
increases by 20 percent. 99 Permanently shifting labor from a relatively unproductive agricultural
sector with high levels of seasonal underemployment to urban areas where one can be productive
year-round is a potential source of growth. Increased urbanization will also create positive

96
UNEP (United Nations Environment Programme). 2013. Livestock, Livelihoods, and Disaster Response.
97
USAID (United States Agency for International Development). 2014. Resilience in Africa’s Drylands.
98
Government of Niger. 2010. Strategic Program for Climate Resilience Niger (SPCR).
99
Motcho, K. H. 1991. Cadre de vie et systèmes de santé à Niamey (Niger).

71
spillover effects for rural growth, by increasing demand for agricultural produce and providing
cash and knowledge that can be used for productive investments in rural areas. There is an inherent
risk associated with this kind of migration in that an influx of uneducated people creates congestion
and great inequality as city growth is not matched by an expansion of infrastructure (housing,
water, electricity and other services to business and households), reducing the productive
advantage cities tend to have. Yet, as migration is inevitable, it is a call to investing in city
planning, to ensure that the business environment improves for formal and informal enterprises
(so that they can absorb the new migrants) and for more investment in human capital to ensure that
future labor migrants are well equipped for the urban labor market (of Niamey but also, and
possibly especially, of Nigeria).

145. Managed well the extractive industry offers much scope for inclusive GDP growth.
The mining sector already contributes about 10 percent to GDP and extractive industry revenues
totaled US$457 million in 2013. There is huge potential to extend this further by increasing
existing production or developing new deposits in uranium, coal, copper, gypsum, iron, limestone,
phosphate, nickel, molybdenum, oil, salt, and vanadium. The extractive sector is capital intensive
and not structurally pro-poor. However, revenues generated by the sector can be instrumental in
building the capital base (physical as well as human) needed for the future income increases and
can be used to finance redistribution schemes. Not all extractive investments are capital intensive
and already a large number of small-scale miners are active (estimated at between 200,000 and
500,000). To increase its productivity and profitability, this sector needs to be formalized and
better organized. Moreover, mining companies are required to invest a substantial share of their
profits in the communes in which they operate, and infrastructure created for (and by) the sector
can have positive spillover effects to other sectors.

146. Dependence on the extractives sector comes with risks that need to be carefully
managed. Revenues may go unrecorded or be managed in a non-transparent manner (resource
curse). A growing extractives sector may go at the expense of other sectors and create Dutch
disease. Care must be given to avoid enclave activities and ensure that forward and backward
linkages are developed. Similarly, financial buffers will need to be built to reduce exposure to
commodity price volatility.

6.4 Binding Constraints

147. To arrive at a final set of binding constraints, a systematic five-step iterative process
was followed. As first step and informed by the analytical framework, critical pathways to poverty
reduction and preliminary binding constraints were identified (step 1). This identification was
informed by analytical findings –mostly descriptive statistics about the nature of poverty (rural),
the overall economy, the state of human capital, the nature of the political settlement, as well as
discussions with country team members on the likelihood of a certain factor being a binding
constraint. The reflection of this initial thinking was presented at the concept note review.

148. Further consultations within the country team, discussion meetings, informal in-
country consultations, and additional analysis were used (step 2) to assess the
appropriateness of the preliminary constraints. As a consequence, ‘economic empowerment’
initial identified as binding constraint was replaced by inadequate human capital, while under the
governance constraint particular attention was given to how to reach beneficiaries more directly

72
and effectively. The analysis was enriched with in-depth work on governance (fragility
assessment; citizen centered approaches), on pathways to poverty reduction (CGE-analysis;
scenario analysis for growth and poverty reduction; assessment of groundwater potential for
irrigation; product space assessment) and with a desk review of causes for low agricultural
productivity.

149. The next steps in the prioritization process were formal in-country consultations
during which feedback was obtained on the revised set of binding constraints (step 3). This
was followed by a series of meetings on how to address different binding constraints (low
agricultural productivity; inadeaquate human capital; high levels of fertility) and concluded with
a country team retreat during which the binding constraints were firmed up and during which a
team concensus was reached on the core constraints and the activities critical to alleviating them
(step 4). A final consistency check of the identified binding constraints with the long-term
objectives of financial, social, and environmental sustainability completed the process (step 5).

Figure 6.5: Five-step process to identifying binding constraints

150. The SCD identifies three areas of binding constraints:

x Low rural productivity

x Inadequate human capital
x Poor governance.
151. Low rural productivity is the first binding constraint. It is the logical outcome from the
observation that the majority of poor people live in rural areas and are engaged in agriculture and
livestock rearing, that productivity is low and the scope for improvement enormous and that
increased incomes from agriculture are a first and critical step on a path towards structural
transformation. Addressing low agricultural productivity implies addressing some of the
consequences that flow from it, such as food insecurity and implies reducing some of the key risks
that households are facing. At the same time, the constraint is sufficiently broad that is implies that

73
the focus should not only be on agriculture and the lack of inputs (seed, fertizer, water, advice)
that are the immediate cause for low productivity, but also on on-farm productivity and access to
markets and policy reforms that are needed to make agricultural input and output markets function
better.

152. Inadequate human capital is the second binding constraint. As was noted in Chapter 3,
human capital is the main asset of poor households who rely primarily on own labor to make ends
meet. Levels of human capital are, however, unacceptably low. The average adults have 1.4 years
of schooling, being malnourished is almost normal (44 percent of children is stunted) and only 15
15 percent of births are attended by a skilled health professional. These low human capital
outcomes have immediate implications for productivity, for the ability to adopt new technologies
and to contribute to a modernizing economy. They support a situation in which gender differences
are large, in which harmful social practices go unchallenged (such as the early marriage of girls)
and in which the world’s highest fertility rate remains unchanged through a combination of low
incomes, low levels of education and poor access to information and health services.

153. Poor governance is the last binding constraint. The SCD has argued how the political
settlement –responsible for the, albeit fragile, stability which is a precondition for development,
comes at a price of a highly constrained business environment, endemic corruption, prestigious,
large scale, urban focused projects and inadequate service delivery –more so in rural areas. The
scope for cross-cutting governance reforms is limited, but in selected areas they may be feasible
and critcical (mining; urban planning) or simply necessary (PFM). A core challenge is not only
what to address but to identify how governance can be improved in a sustainable manner. To this
end one seeks reforms that align the incentives and interests of the elite with those of citizens. This
SCD argues that engaging citizens more directly and empowering them with education and
information, through (direct) resource transfers and by strengthening their ability to choose one
way to solve this “elite versus citizens” conundrum.

154. Transferring purchasing power as well as knowledge directly to citizens (most of

whom live in rural areas) creates incentives to pay more attention to what happens outside
the capital. By implication it will also create incentives for the (wealthy) elites to invest locally.
This suggestion is rooted in Olson’s (1965) seminal insight that if the rich have a strong interest in
the provision of a public good, inequality could facilitate collective action because it would be in
the interest of the wealthy to provide the good, allowing the poor to free ride. 100 Applied to Niger,
by giving poor citizens the ability to purchase goods (for example, through fertilizer vouchers that
can be used at local shops), elites become motivated to invest in local shops and dealerships instead
of in channeling public resources through inefficient public procurement and distribution schemes.

155. A citizen-centered approach could thus be the way to change Niger’s development
trajectory. It could be operationalized by moving away from a public sector-led provision of
services to an approach that empowers citizens with information; education; purchasing power
(transfers, vouchers); and choice in service providers. It can be brought about by (a) promoting
small-scale interventions (as opposed to large-scale interventions requiring complex governance
structures) that target and involve poor households directly. Technological advances in ICT,

100
Olson, M. 1965. The Logic of Collective Action: Public Goods and the Theory of Groups. Cambridge, MA:
Harvard University Press.

74
biometric identification, and engineering make individualized interventions implemented at scale
a realistic option. Hence, small pumps may be preferred over large irrigation schemes, off-grid
electricity solutions to an expansion of the power network, and mobile phones over fixed
telephony. It also includes (b) improved access to information (as well as literacy); (c) a better
alignment of the incentives of service providers with results (such as performance-based
financing); and (d) promoting private sector service provision where feasible.

156. The use of e-vouchers to transfer agricultural subsidies presents one illustration of a
citizen-centered approach. An e-voucher system starts by creating a database with information
on the core characteristics of households: where they reside, family size, sources of income,
information about wealth, and their phone number (or that of someone they trust). This database
is used to identify recipients who are eligible for certain subsidies. Traditionally, these subsidies
have been for fertilizer or seed, but vouchers could also be given for assets, extension services or
even education. When recipients receive their unique voucher through a text message, they are
also informed where to go to redeem it. The provider, say a fertilizer shop, would receive a
matching text message and upon verification provides the good or service. There are multiple
advantages to such an approach. Recipients can be selected based on characteristics defined by
policy makers, vouchers can be tailored to the needs (and wealth) of different recipients (levels of
subsidization can consider the wealth of a recipient for instance), private sector provision is
promoted, transaction costs are reduced, and transparency and accountability improved.

157. Another illustration of a citizen-centered approach refers to rural roads. The

traditional approach has been that donor-funded projects support the sector ministries in charge of
rural/local roads. These ministries select rural roads to be improved and prepare detailed
engineering studies for full road rehabilitation. This is followed by the selection of civil works
contractors who carry out the works. It typically results in a relatively small number of rural roads
being rebuilt, often at excessively high technical standards and at a high cost per kilometer. There
is little involvement of local communities, except perhaps during the construction when
contractors hire local unskilled labor. Maintenance of these constructed roads is not assured,
especially since the Road Maintenance Fund of Niger (Caisse Autonome de Financement de
l'Entretien Routier, CAFER) focuses on main roads. Typically, newly rehabilitated roads
deteriorate into a very bad condition within four or five years, making passage difficult or
impossible during the rainy season.

158. The reality is that local populations can often travel on rural roads during the dry
season even when they are poorly maintained. The dry ground is hard and permits travel using
motorcycles, pickup trucks, and small trucks. Problems occur during the rainy season when farm
inputs need to be transported and just after the rainy season when the harvest needs to be taken to
market. At that time, ‘black spots’ develop as a result of the rains, which often make passage
impossible. Local communities know very well where these ‘black spots’ are. A citizen-centered
poor approach that can be followed instead can be characterized as follows:

x Road committees are formed within farming communities, with participation of

leading farmers who depend on functioning local roads.

x Each road committee composes a road workforce with local workers, especially
including landless young people.

75
 x Road committees receive a contract for ensuring a certain minimum service level
during critical months of the year, typically the rainy season and just thereafter.

x The service level is defined in a way that everyone understands, such as “the road
must be good enough so that a loaded Toyota 2x4 pickup truck can travel at a speed
of 40 kmph.”

x The local road committee receives basic technical and engineering support through
local consultants, who advise them on how to best carry out works and how to identify
suitable materials to use.

x The local road committee is paid a fixed sum for every week that the road complies
with the service-level criteria (performance contract). Noncompliance results in
nonpayment and in pressure by the broader local community (who need the road to
function) on their respective road committee (who may not have done their work).

159. Such approaches have been introduced successfully in Chad more than 15 years ago and
have become mainstream there but not in Niger.

160. A third illustration of an approach to citizen-centered service delivery is

performance-based financing (PBF). PBF has been associated with impressive improvements in
service delivery performance. The approach shifts financing from centralized and input-based
financing to financing of local service providers based on performance. A typical PBF project
provides performance bonuses based on the quantity and quality of services provided. Results are
verified and users’ feedback is integrated in the performance assessment, which dictate bonus
amounts provided. Through contractual arrangements, facilities are granted greater management
autonomy in return, allowing them to take local decisions on how to use PBF revenue to improve
service delivery and motivate their personnel. Most PBF approaches are implemented in the social
sectors, health in particular, but with the right adjustments, the approach can also be used in the
education sector or in agriculture (extension services for instance). PBF is guided by 10 principles,
which reflect the paradigm shift relative to traditional, centralized, and input-focused approaches
that citizen-centered service delivery seeks:101

x Separate the functions of regulation, provision, fund disbursement, contract

development and verification, and community empowerment.

x Stimulate competition for contracts among facilities and other stakeholders.

x Promote public-private partnerships with equal treatment of public, religious, and

private providers.

x The roles of the regulator at the national, regional and district level are to define
output, quality, and equity indicators. The regulator also costs out public budget with
equity bonuses for vulnerable regions, facilities, and individuals. The regulator

101
SINA 2016. PBF source book.

76
 intervenes when the facility becomes a danger to public health or when the facility is
engaged in criminal activities.

x Providers are autonomous to hire and fire, set user fees, and respond to government
defined packages and client demand.

x Providers must ensure that revenues and expenditures are balanced while providing
quality and equitable services with motivated staff at the risk of nonrenewal of
contract and bankruptcy.

x Contract development and verification (CDV) agencies negotiate contracts, verify

results, and coach managers to use business plans and indices instruments; the subsidy
payments are done by a different organization.

x Local community groups enhance patient interests and health facilities conduct
social marketing.

x Promote efficiency and cost containment by CDV agencies and government to pay in
cash or through bank transfers for results instead of providing inputs in kind.
Facilities must have the free choice to purchase their inputs from independent
distributors operating in competition.

x Seek economic multiplier effects to generate employment, economic growth, and tax
revenues by deliberately injecting cash into the local economy.

161. A citizen-centered approach will offer its own challenges. In a gross simplification of
Niger’s traditional authority structures, citizens are primarily considered subjects of local leaders
whose legitimacy is rooted in a gift economy and a system of mutual obligations in which subjects’
request favors from leaders, which the leaders grant if they are able to do so, expecting obedience
in return. The resulting equilibrium creates sharp inequalities in wealth, power, and social status.
Attempts to empower citizens directly may prove to be contentious and be resisted by local
elites.102 They may also end up being supported particularly when they operate within the existing
systems and benefit elites as well as subjects.103 Successful direct delivery will require considerale
local knowledge. As Box 6.1 points out, this can be quite complex.

102
Mansuri, G., and V. Rao. 2013. Localizing Development: Does Participation Work? Washington, DC: World
Bank. doi:10.1596/978-0-8213-8256-1.
103
De Sardan and his coauthors describe, for instance, how cash transfers offered to selected villagers are
redistributed by chiefs among all villagers stating, “L’argent du Blanc appartient à tout le village. Il faut donc laisser
tout le monde profiter de cette gratuité." Les transferts monétaires au Niger: le grand malentendu. Revue Tiers-
Monde January 2014. doi:10.3917/rtm.218.0107.

77
 Box 6.2: A citizen-centered approach requires local knowledge
Service delivery is rarely done exclusively by the state. Take the example of personal safety in Niger. Disputes
between farmers and nomadic herders are common in the country’s interior and sometimes lead to fatalities. It is
the job of the police (gendarmerie) to prevent these (by patrolling) or to settle them (through written reports or
arrests). To do either of these, a 4x4 vehicle is needed to get around. However, the car is often out of order, and the
fuel allowance is woefully inadequate; hence, patrols are few and far between. It is, in fact, the chief’s ‘knights’
who alert the police whenever there is trouble. The car is fixed or the fuel is bought with dues paid by the local
population and collected by the village chiefs and a contribution from the mayor. As for the ‘livestock routes’
(‘couloirs de passage’) created especially for the herders, which should allow conflicts to be avoided, these are
defined and mapped out by NGOs and funded by aid agencies.
This situation is one of co-production of the public good ‘safety’, which, in addition to the services provided by the
police, also brings into play the chief, the municipality, and civil society (NGOs). Understanding how the various
combinations of actors, organizations, and means—both state and non-state—interact to deliver public goods, and
the incentives these different actors face, will be critical to designing ways to improve public service delivery.
Source: Adapted from: Jean-Pierre Olivier de Sardan. "The Delivery State in Africa. Interface Bureaucrats,
Professional Cultures and the Bureaucratic Mode of Governance.” Mimeo.

162. The how to question extends beyond governance and also related to the issue of
poverty traps. In Chapter 2, the existence of multiple poverty traps was emphasized and the
implication drawn that addressing one trap at a time was unlikely to be very effective. It was
pointed out that certain interventions might address more than one trap (as is the case with
irrigation) but irrigation in areas affected by conflict, or without improved access to knowledge
and information, might still not amount to much. The implication is that preference should be given
to integrated approaches that address more than one problem at the same time. This thinking is
reflected in the ‘low productivity’ area of constraint as it identifies multiple restrictions that need
to be addressed at the same time, requiring contributions from different sectors: agriculture, water,
finance, transport, and social protection are explicitly mentioned. However, integration should also
go across areas of constraints as improved human capital (health, nutrition) and better access to
knowledge (adult literacy, information) are critical to improved productivity.

Area of constraints 1: Low rural productivity

163. Low productivity of key food crops and livestock is the first binding constraint to
poverty reduction. To overcome this constraint, four key interventions are identified: (a) policy
reforms removing systematic biases against the sector, (b) the introduction of improved
technology, (c) improved market access and local transformation, and (d) social transfers.

164. Removing policy constraints is a first prerequisite to increasing agricultural

productivity. Without a supportive policy environment, the benefits from investments to raise on-
farm productivity may not accrue to farmers. Without access to finance, it will be hard for
smallholders to invest in productive assets or to get the working capital needed to purchase seed
and fertilizer. This means facilitating leasing, micro-finance institutions, rural credit, warehouse
receipt system, and mobile banking. It will also require an effective land policy with an effective
implantation of the current legal and regulatory framework, including the functioning of the Land
Commission (Commission foncière, COFO) and appropriate conflict-resolution mechanisms. A
supportive policy environment requires creating competitive conditions and low transaction costs.
Presently, this is often not the case. There are (near) monopolies in the market for paddy (Riz du

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Niger), fertilizer, seed, phytosanitary products, and farm equipment (Central Supply of Inputs and
Agricultural Materials [La Centrale d'Approvisionnement en Intrants et Matériels Agricoles,
CAIMA]). The state is very active in the markets for cereal (Office of Food Products [Office des
produits vivriers, OPVN]) and irrigation (National Hydro Agricultural Development Office
[Office National des Aménagements Hydro agricoles, ONAHA]), often in a distortionary manner.
Also regional ‘collaboration’ will need to be actively pursued to ensure open borders for Niger’s
produce, reduce transaction costs, and ensure sufficient access to water (of the Niger River).

Figure 6.6: Productivity interventions can be spatially focused

Most poor live in the rainfed sorghum and mille In areas with a high density of cultivation which
belt are suited for irrigation (see Figure E1)

Source: World Bank 2016 staff and S. Fritz, L. You, A. Bun, L. See, I. McCallum, C. Schill, C. Perger, J. Liu, M.
Hansen, M. Obersteiner Cropland for sub-Saharan Africa: a synergistic approach using five land cover data sets
Geophys. Res. Lett., 38 (2011), p. L04404 http://dx.doi.org/10.1029/2010GL046213

165. On-farm productivity can be increased through greater attention to extension,

improved availability of inputs and irrigation. Where possible, because of the (sustainable)
availability of water, economically feasible (small-scale, solar) irrigation is the preferred approach
to raising productivity.104 It reduces dependence on the weather, land pressure, and
underemployment as multiple harvests are possible during the year. In addition to irrigation and
improved water management, access to improved seeds and other inputs in combination with
agricultural extension is needed. Agricultural extension is particularly important to reduce the yield
gap between what is feasible with existing technologies and what is achieved in practice. The focus
should be on increasing the production of staple foods: sorghum, millet, and cowpeas. This should
be combined with action to raise the productivity of livestock, particularly birds and small
ruminants, the animals most frequently owned by poor households.

166. To increase productivity of agriculture, the focus will need to go beyond agronomical
aspects. To successfully raise agricultural productivity, a host of complementary activities needs
to be taken. First gender differences need to be taken explicitly into account when designing
interventions (see also para 192). In the absence of market access, increases in production may
remain unsold and the positive effects of productivity enhancing investments may remain small
(as per the CGE scenario discussed in Section 4.4). It suggests that attention needs to go to selected

104
Small-scale irrigation is much more cost-effective than large-scale. The cost of irrigation using sand dams and
improved ponds ranges between US$500 and US$2,500 per ha against US$12,000 per ha for large-scale irrigation.

79
supply chains and export corridors, to storage, and to the ability of farmers to organize themselves
(e.g. organized in cooperatives farmers bypass middlemen and access markets directly). Market
access also means investments in roads, particularly to the production basins.105 In the absence of
access to information, farmers may not be able to learn about new technologies or the prices of
their products. Access to energy is critical for the (local) transformation of agricultural produce
and for irrigation.

167. Activities to raise agricultural productivity may be combined with a guaranteed food
or cash-for-work program. Section 6.1 demonstrated that transfers can dramatically reduce
poverty. It is less known that such programs also raise agricultural productivity (and hence
growth). Transfer programs offer households access to finance, and there is ample evidence that
households that receive cash transfers invest in productive assets. 106 Next, and in the face of severe
weather risks, people opt for income strategies that are geared at survival as opposed to increasing
incomes. The consequences for poverty reduction are negative. It leads, for instance to the sale of
productive assets when a crisis hits and/or the adoption of low-risk, low-return crops, overgrazing
(as everybody invests their savings in cattle), and social practices such as early marriage of girls,
which passes the risk of yet another mouth to feed to the family of the groom. Safety nets help
address this and offer the freedom to make less-constrained choices. To be effective, safety nets
need to be at scale and accessible in time of need—for instance in the form of (standby) cash- or
food-for-work programs.107

Table 6.2: Addressing the rural productivity constraint in a sustainable manner

1 Policy reform to address systemic biases affecting the rural sector

Facilitate private sector provision of farm inputs
Address agricultural market distortions caused by distribution of free food and seed
(social protection)
Ensure quality control of seed and fertilizer
Improve security of tenure (women!)
Promote access to finance (including leasing), particularly in rural areas
Promote regional collaboration on cross-border trade, Niger River, and so on
Increase on-farm productivity through access to critical farm inputs (with particular attention to
2
women)
Introduce high-quality, publicly funded (privately provided) extension services
Develop drought tolerant, improved seed varieties (particularly for coarse grains)
Make suited (solar, small scale) irrigation and water management technologies available and accessible
Promote farmer collaboration (cooperatives, master farmer schemes)

105
Niger’s road network is not very dense but only in few areas would additional paved roads be economically
justified (that is, more than 100 trucks a day). Given the generally dry terrain, access problems are limited to the wet
season. Improving access does not require pavement but spot improvements in critical areas.
106
For example, Monchuk, V. 2014. Reducing Poverty and Investing in People: The New Role of Safety Nets in
Africa. Washington, DC: World Bank. doi:10.1596/978-1-4648-0094-8.
107
There is scope for large-scale safety nets that guarantee households a minimum income. For example, in 2016, a
total of US$257 million will be spent on emergency aid in Niger (Cabinet du Premier Ministre, Plan de Soutien
2016). This is equivalent to a cash-for-work program in which 2,000,000 participants (one from every rural family
in Niger) works for 45 days at a wage of FCFA 1,300 a day (the going rate for cash-for-work programs), including
20 percent for overheads.

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 Extension adapted to irrigation
Increase productivity of livestock (with focus on small ruminants)
Animal health services
Improved rangeland management and secure livestock corridors
Strategic destocking
Promote sedentary livestock (including birds) and develop markets for livestock feed
Develop value chains for livestock products
3 Improve market access and local transformation
Improve rural access roads
Facilitate storage and warrantees
ICT-based information and market services
Provide energy for local transformation of produce
4 Support vulnerable populations to protect and rebuild their productive capacity
Scale up social protection; introduce guaranteed social protection
Support displaced people and refugees (including host communities)

Area of constraints 2: Inadequate human capital

168. Low levels of human capital are the second most binding constraint. The ability to
work productively is the core asset of poor individuals. As labor is the main asset of the poor,
alleviating this binding constraint is complementary to increasing rural productivity through
supply and demand side measures. Increased productivity leads to higher incomes, which leads to
better nutrition, which in turn improves the ability to work or to pay for health treatments. Better
education, in turn, provides farmers more access to new information and aids the adoption of new
technologies. Better-educated people are also much more likely to successfully migrate from rural
to urban areas or to other countries. Better-educated girls are less likely to marry young. 108

169. With an average of 1.4 years of education and malnutrition rates of 44 percent,
addressing the human capital constraint is urgent. Specific attention will need to go to women,
as they are particularly disadvantaged. To assure a decent rate of return, investments in human
capital will need to be measured and designed with efficiency in mind. While the demand for
education will inevitably grow, absorbing more students in schools where they hardly learn
anything—as is the case presently—is tantamount to wasting money and human resources.
Selective investments will need to be made to ensure that on the one hand minimum levels of
literacy and numeracy are attained, and on the other, a sufficient number of people are being trained
at higher levels of education to address existing skills shortages (with just 16 percent of adults
having completed primary school, it is not evident who will teach the next generation, where
qualified extension officers will be found, or who will run the administration once the current
generation retires).

170. A first priority is to focus on improving the way services are delivered. The present
mode of service provision leaves much to be desired and there are gross inefficiencies in which

108
The average age of first marriage for a girl is 15 when she has no education, 17 when she has primary education,
20 with secondary education, and 23 with tertiary education. (Source: ENISED 2015 survey).

81
current budgets are spent. Staff are few in some places and many in others. They are unmotivated
and frequently absent. Critical inputs are not available. These factors lead to a situation in which
the efficiency of spending is very low. This will need to change by changing the way in which
services are delivered and in which resources are allocated. Achieving the twin objectives of higher
levels of basic competencies and more people educated at higher levels also requires a
reconsideration of the way the school system operates. An inclusive approach in the early years
(when the unit cost of schooling is low) may have to be combined with an exclusive one for higher
education levels when unit costs are high. It requires stringent selection based on quality and,
concomitantly, high dropout rates.

171. The skill level of teaching and nursing staff also needs to improve. PASEC data
demonstrate that students learn little while at school. The Service Delivery Indicator (SDI)
provides an explanation as it demonstrates that a large fraction of teachers are functionally
illiterate, whereas a majority of health staff are not able to implement basic health protocols. This
needs to be changed by improving the quality at teaching colleges, retraining teachers, and,
possibly, laying off those who lack minimum competencies.

172. Competencies are not only low for teachers and health staff. There are many areas in
which professional skills and competencies need to be improved. As needs are enormous, the areas
in which investments in skills should be made need to be carefully defined. However, investments
in extension, health, education, mining, engineering, and journalism are aligned closely with this
SCD.

173. There is a need to focus on behavioral change as complement to improved health

services. Many diseases and conditions can be prevented through simple behavioral changes. This
holds for malnutrition, which has a large dietary component, and for hygiene or reproductive
health. Social protection programs have been found to bring about behavioral changes by making
the receipt of cash conditional on certain behaviors (ante-natal visits, sending children to school,
vaccination etc.). Another approach that relies on village health workers who carry a plethora of
different messages is promising. Ethiopia has developed an interesting approach that builds on
three core interventions: health extension workers, model families, and the health development
army.

x Health extension workers are the key drivers of the program. Two health
extension workers are deployed for each health post serving 3,000 to 5,000
population. They are recruited based on nationally agreed criteria that include
residence in the village, capacity to speak the local language, graduation from 10th
grade, and willingness to remain in the village and serve communities. Selection is
done by a committee comprising members nominated by the local community and
representatives from the district.

x Model families are those households that are (a) trained in maternal health, malaria
prevention and control, and hygiene and environmental sanitation packages; (b) able
to implement these packages after the training; and (c) able to influence their relatives
and neighbors to adopt the same practices. Before becoming part of the health
development army, model families are expected to meet regularly for experience
sharing.

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 x The health development army is an organized movement of communities forged
through participatory learning and action meetings. The army is designed to improve
the implementation capacity of the health sector by engaging communities to identify
local challenges and corresponding strategies. It is also designed for scaling up best
practices from one part of the country to another.

174. A final and complementary element is an access to information strategy. It focuses on

alphabetization—possibly along the lines of the health development army described above—and
strengthening of media and development of content.

Table 6.3: Addressing the human capital constraint with particular attention to women

1 Address systemic governance failures that affect the health and education sectors
Introduce service delivery models that enhance provider autonomy, align incentives with
service delivery, and improve service quality
Strengthen supervision and accountability to users
Address geographic inequities in staff and other resources
Enhance entry levels for recruitment and training colleges
Promote curriculum adaptations (use of local language, Franco-Arab schools, focus on skills)
Increase budgetary spending on health and education to the minimum level required for adequate
service delivery
2 Improve the quality of teachers and health care providers
Invest in training colleges and their curricula
Retrain existing staff with potential
Lay off unqualified staff and hire qualified staff (even if foreign)
3 Promote behavioral change (reproductive health, hygiene, nutrition, child care)
Promote community health workers and behavioral change through social protection programs
Promote alphabetization, national and community radio, TV, and other communication tools
Develop appropriate media content for behavioral change
4 Invest in skills and competencies (with particular focus on economic opportunities for women)
Invest in skills training in selected areas (extension, (higher) education, health, journalism,
transformation of agricultural produce, mining, ICT)

Area of constraints 3: Poor governance

175. Many development opportunities remain unrealized because of poor governance of

the public and private sector. This is the third binding constraint. The capacity of the
administration is limited and incentives are not well aligned with service delivery. The business
environment is constrained by a high regulatory burden, limited competition, and an administration
that adheres to a state-led approach to service provision. Addressing these constraints in a
competitive, donor and natural resource dependent political settlement with low bureaucratic
capacity is a major challenge. Yet, doing so is imperative to unlock Niger’s development potential
and to make the country (and political settlement) more resilient to shocks.

83
176. Four building blocks to alleviate this constraint are identified. First, security and
stability need to be ensured as this is a prerequisite for development. Already heightened insecurity
forces the country to spend increasingly on its military. Defense, order, and security represented
13.4 percent of the voted budget in 2015 compared to 8 percent in 2011. While this reflects a
significant increase, it is not abnormal given the security context and the need to catch up after a
period of very low spending. While more spending on security implies, by definition, less for more
developmental purposes it would be incorrect to juxtapose security and development, security
being a necessary but not sufficient condition for development. In addition to increased spending
on security, it is important to closely monitor the situation because, even though the country is
stable at present, there exist risk factors such as a major drought or a tightening of the elite coalition
that could trigger widespread instability and violence. While certain aspects fall outside the realm
of development actors, there are also activities that they can undertake to reduce Niger’s fragility.
Support to people displaced by violence and their host communities helps prevent vicious cycles
of conflict-deprivation and more conflict. Strengthening formal and informal dispute resolution
mechanisms; strengthening the internal security forces (police, gendarmerie); and preventing
illegal activities and money laundering are some activities that development actors can undertake
to help prevent (future) conflicts.

177. Next, the capacity to deliver citizen-centered public services will need to be
strengthened. Improving the capacity of the public service across the board may not be feasible
given the many vested interests and inability to implement a long-term strategy, but an
opportunistic approach is achievable. After all, the state is a complex organization machine, whose
actions are shaped by its actors, officials and bureaucrats; their histories and personalities; and the
incentives they face. Within the state, ‘islands of effectiveness’ already exist. Others could
possibly be created in areas at the SCD: education, health, agricultural extension, public finance
management, or statistics—particularly if the latter would provide the data needed to assess civil
service performance.

178. An approach needs to be adopted that reaches citizens directly and empowers them.
Past approaches have not been able to deliver effectively as evidenced by the fact that service
provision is unequal (very much focused on Niamey) and of low quality and low efficiency. A
more citizen-centered approach offers promise particularly when it targets the local level,
strengthens local initiatives and decision making, and embraces service delivery by whoever is
capable of doing so. Such an approach would give citizens choice over who provides services and
enhances ownership, a precondition for sustainability, and might change the focus of the polity
(and donors) away from a centralized, state-led development model as the transfer of resources to
citizens creates incentives to invest locally.

179. New technologies make direct, citizen-centered service delivery realistic. The mobile
phone revolution has in many ways shown the way, demonstrating how this technology not only
enables communication but also financial inclusion and market access. As important as mobile
telephony is affordable solar power, which brings access to energy within the reach of many. Also,
the reduction in scale at which technology operates efficiently is important: (affordable) smart
phones instead of main frame computers and (affordable) motorbikes instead of buses democratize
access to technology and reduce the need for collective action (by the state). It makes small-scale
solar irrigation feasible in settings where large-scale irrigation used to be the norm. It makes market

84
access less dependent on well-maintained roads as small trucks and motorbikes can navigate
poorly maintained infrastructure.

180. New technologies deserve to be systematically embraced because they reduce

transaction costs, improve targeting and supervision, and offer scope for private sector
service provision. An enabling environment for targeting and service provision starts by ensuring
self-identification of every citizen. Cheap identification is possible, as demonstrated by India’s
Aadhaar program which offers every citizen a unique ID at less than US$1 per person. An enabling
environment also requires mobile phone access. It necessitates expanding the mobile phone
network and raising competition in the sector. It includes promoting investments in these
technologies, which requires revisiting the tax code that puts mobile phone and solar equipment in
the high import tariff bracket (upward of 40 percent). It requires ensuring that financial regulations
become conducive to mobile financial services and a state that actively embraces these services,
for example, by making salary payments through mobile phones. Already new technologies have
created different approaches to service provision such as direct transfers of cash to social protection
beneficiaries or of input subsidies to farmers by using e-vouchers. Not only do such technologies
reduce transaction costs, they allow for better targeting and enhance possibilities for supervision.
The combination of such technologies creates new opportunities for service provision by the
private sector: local shops can provide the farm inputs that e-vouchers subsidize. Private extension
agents can offer services paid for by e-vouchers sent to farmers. New technologies can also
improve accountability, for instance, by checking teacher absenteeism or the presence of students.

181. More direct service delivery to citizens needs to go together with a strengthening of
the state at the central level. Addressing central governance constraints in a competitive political
settlement with low bureaucratic capacity is a major challenge. A long-term strategy to building
capacity is required. Improving capacity across the board may not be feasible given the many
vested interests and inability to implement a long-term strategy, but an opportunistic approach is
achievable. Others could be created in areas such as education, ICT, quality control—critical when
much more service provision is handed over to private entities—extension, or statistics (the latter
definitely when statistics are used to assess the performance of service providers).

182. Third, economic opportunities need to be realized. In addition to the agro-industrial

sector which was discussed under area of constraints 1, this holds for the telecom sector—which
also plays a critical role in developing citizen-centered approaches—and for the mining sector
which has much potential for growth109 and developing forward and backward linkages. Cities,
primary as well as secondary, should be seen as centers of economic growth and transformation.
As such, sufficient attention needs to be paid to city planning, to infrastructure provision (roads,
energy, water and sanitation, telecom) and to ensuring a conducive business environment for
formal as well as informal sector activities.

183. To unlock Niger’s growth potential, the cost of doing business needs to be reduced.
Transport costs are very high because of cartels, poor maintenance, a large number of checkpoints,
and inefficient and costly procedures. The informal sector needs to be promoted and security of

109
As always, there are many sensitivities around increasing revenue from mining. An additional but important
factor in Niger is that many former rebels in the north of the country are involved in artisanal gold mining. Any
regulation or development of this sector can easily go against their interests and would create a very explosive
atmosphere.

85
contracts and tenure improved. Rural input and output markets are distorted by state interventions
and the activities of public companies. Public investments should be limited strictly to
economically viable investments and should be used to crowd-in private investments and to
support areas with evident market failures. Instead of using public investments to replace private
investments, which are not forthcoming because of policy failures, policy reform should be used
to attract private investors.

184. Developing cities is an integral part of an inclusive growth strategy. Well-functioning

cities are centers of income generation and growth. Cities can be centers of knowledge, innovation,
and production as the concentration of people in cities generates opportunities for interaction,
exchange, and specialization. To promote their vital economic role, it is essential that cities present
an enabling environment for private sector development, attract skilled labor, and provide adequate
infrastructure and services such as transport, communications, power supply, water and sanitation,
housing, and financial and business services. Cities need to be able to generate their own revenue,
which typically comes from land transactions or taxation of land and property.

185. Mining presents another sector with growth potential, but transparent governance is
a precondition. Niger’s ample and largely unexploited natural resources represent a huge potential
for revenue generation—revenues which in turn can be used to stimulate growth or for poverty
reduction. However, too often natural resources turn out to be a curse, and few of the potential
benefits are realized. To avoid this, natural resource development needs to be preceded by
improvements in the governance of the extractives sector, as well as by a strengthening of the PFM
system, to ensure that any additional revenues that are generated from mining development are
indeed translated into increased spending for public services.

186. Finally, the management of public finances needs to be improved. This includes PFM
systems which received devastating scores in the latest PEFA assessment—concluding that the
system was insufficient to ensure macro-stability, and public investment management. Planned
public investments need to be reviewed for their allocative, productive and distributive efficiency
and the effectiveness with which existing projects are being implemented explored. The quality of
statistics needs to be improved if decision making is to be informed by data and to enhance the
readiness for RBF.

187. Some of the coup d’etats that took place in the past can be directly linked to the
inability of the then governments to handle the consequences of drought. It shows the
importance of preventing some shocks from happening (for instance by investing in irrigation and
drought-resistant crops) and the need to create financial buffers in time of plenty or buy insurance
to deal with shocks when they materialize. The vulnerability of the economy and public
investments to the commodity price shock and the associated recession in Nigeria with its
spillovers to Niger further illustrate the need to come up with policies that allow the country to
better deal with shocks.

188. Improved donor coordination is an integral element of improved public financial

management. In a setting where a large fraction of the budget is funded by donors, and where the
capacity of the administration is limited, donor coordination—among themselves and with the
authorities—is critical. It is needed to avoid duplication, to reach scale, and to avoid too many

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interesting pilots that are never scaled up. Coordination can take many forms: a promising
approach is co-financing of one activity by multiple donors.

Table 6.4: Governance constraints to inclusive growth and service delivery

1 Reduce security risks and stressors to stability

Reinforce formal and informal conflict resolution mechanisms
Promote an efficient and independent judicial system and professional internal security forces
Address illicit financial flows
Monitor stressors on security and stability
Support conflict-affected and displaced populations (including host communities)
2 Enable citizen-centered service delivery
Promote public sector capacity through selected centers of excellence
Create a competitive ICT sector with network coverage in rural areas (including schools, clinics, and so on)
Give preference to (e)-voucher systems and direct transfers to citizens to enhance choice and ownership
Promote private/NGO provision and RBF
Strengthen statistics for decision making along with citizen accountability and external quality control
Give people an identity (ID4D)
3 Develop economic opportunities: mining
Promote extractive industries governance; improve oversight and regulatory capacity
Improve size, collection, and management of revenues (including transparency)
Developing new sites in accordance with good governance principles
Develop economic opportunities: primary and secondary cities
Improve city management, planning, zoning, and land market development
Enable the informal and formal private sector
Ensure reliable, affordable, and sustainable electricity provision (on-grid); water; and transport
Develop economic opportunities: trade and business environment
Promote private sector development and trade and create an enabling business environment
Reduce the cost of transport, particularly on main corridors
Facilitate regional integration and cooperation
4 Strengthen public financial management
Implement efficient and transparent PFM systems
Strengthen public investment management
Develop approaches to financial stabilization
Improve donor coordination
Note: ID4D = Identification for Development Initiative.

189. Multiple synergies exist between the three areas of constraints which allow addressing
the underlying factors identified in the analytical framework particularly risk, and
population (governance already is a binding constraint).

x Population is addressed, in part, by promoting irrigation. Such a policy would

increase productivity (and household incomes) while alleviating the land constraint at
the same time. Implemented at scale an irrigation initiative that focuses on

87
 smalholders would be instrumental to averting a Malthusian crisis that might
otherwise develop. It is complemented by investing in improved health services and
activities aiming to engender behavioral change, including through improved access
to information, commune health workers, social protection programs and
alphabetization.

x Risk. Climate risk and more broadly, fragility, are addressed through a focus on
irrigation and strengthening the ability of farmers to adapt (extension services, access
to information). Assistance to vulnerable populations, through social protection and
assistance to displaced populations and recipient communities help address the
consequences of fragility while city development, investments in human capital, and
approaches to strengthen the abilities of the state at financial stabilization are aimed
at enhancing resilience.

190. Gender is relevant to all of the three binding constraints and must be taken into
account in the proposed mechanisms to address the binding constraints.

x Low rural productivity. The identification of approaches to increase Niger’s

agricultural productivity must take into account the likely impacts on (a) women’s
access to labor; (b) women’s child care responsibilities and time available for farming;
and (c) women’s access to land (the three factors identified by Backiny-Yetna and
McGee as underlying the agricultural productivity gender gap in Niger). To promote
women’s access to farm labor, the Government could explore interventions that
provide women with finance to hire farm labor or that task agents with helping women
find labor. To address the negative impact of the household dependency ratio on
women’s relative productivity, there should be a strong focus on reducing fertility and
exploring policy options such as community-based child care. This would not only
allow women to spend more time on productive activities and on supervising farm
labor but would also allow women to participate in groups such as producer
organizations, which can be an important source of technical information and
learning.110 On land, there is evidence from other countries in the region: in Rwanda,
for legally married women, the Land Tenure Reform pilot program increased
women’s documented land ownership and increased the likelihood of investing in soil
conservation (with twice the impact on women as on men).111

x It is also important that non-gender-specific policies take gender concerns into

account in their design. For example, the identification of new agricultural
technologies/techniques should take into account their likely impact on women’s time.
Some types of climate-smart agriculture have been shown to increase the burden of
labor on women. For example, in Zambia, conservation agriculture may have added
to women’s relative time burden as it involves more weeding, which is traditionally a

110
Wouterse, F. 2016. Empowerment and Agricultural Production: Evidence from Rural Households in Niger. IFPRI
discussion paper 2016.
111
Ali, D. A., K. Deininger, and M. Goldstein. 2014. “Environmental and Gender Impacts of Land Tenure
Regularization in Africa: Pilot Evidence from Rwanda.” Journal of Development Economics 110: 262–275.

88
 woman’s role.112 Another example of the importance of designing interventions to be
gender sensitive is with extension services, which should take into account cultural
norms that may prevent women from benefitting, for example, by training a sufficient
number of female agents or by focusing on gender training for male agents.

x Inadequate human capital. There is a need for a specific focus on women’s human
development, given the poor maternal heath indicators, extremely high fertility and
adolescent fertility, and gender gaps in schooling and literacy. These issues can be
addressed by non-gender-specific interventions to improve overall service quality in
health and education and also by gender-specific interventions, such as behavioral
change interventions and access to information (targeting both women and men) to
influence demand for large families and attitudes to investing in girls’ education 113
(for example, see UNFPA [2014] on the ‘ecoles des maris’ model in Niger;
conditional cash transfers to keep girls in school and delay marriage and
childbearing;114 and combined youth vocational and life skills training to reach those
girls who have already left school and are unlikely to return.115

x Poor governance. Addressing some of the governance challenges in the public and
private sector may bring particular benefits to women. Efforts to improve the enabling
business environment are likely to be particularly important for women, who tend to
have less access to the resources (money, time, literacy, social networks) that are
needed to overcome complex and financially costly/time-consuming regulations.116
Efforts to enable the informal sector will also benefit women who are even more likely
than men to operate informally. As discussed above, efforts to improve tenure security
can also be especially beneficial for women (by improving their access to collateral
and incentives to make productivity-enhancing investments in land) if they are done
in a gender-sensitive manner. There are additional barriers for women trying to
conduct business. The Civil Code, for instance, provides for the male as the head of
the household with ‘marital authority’ over his wife and explicitly limits her legal
capacity in marriage, including with respect to exercising a profession and opening a
bank account. Even though the Commercial Code allows women to have independent
112
Kaczan, D., A. Arslan, and L. Lipper. 2013. “Climate-Smart Agriculture: A Review of Current Practice of
Agroforestry and Conservation Agriculture in Malawi and Zambia.” United Nations Food and Agriculture
Organization, Rome. http://www.fao.org/docrep/019/ar715e/ar715e.pdf.
113
UNFPA (United Nations Population Fund). 2014. “Niger - Husbands’ Schools Seek to Get Men Actively
Involved in Reproductive Health.” http://niger.unfpa.org/docs/SiteRep/Ecole%20des%20maris.pdf.
114
Baird, Sarah, Ephraim Chirwa, Craig McIntosh, and Berk Ozler. 2010. “The Short-term Impacts of a Schooling
Conditional Cash Transfer Program on the Sexual Behavior of Young Women.” Health Economics 19 (1): 55–68.
Baird, S., C. T. McIntosh, and B. Ozler. 2011. “Cash or Condition: Evidence from the Cash Transfer Program.”
Quarterly Journal of Economics 126: 1709–53.
Baird, S., R. S. Garfield, C. T. McIntosh, and B. Ozler. 2012. “Effect of a Cash Transfer Programme for Schooling
on Prevalence of HIV and Herpes Simplex Type 2 in Malawi: A Cluster Randomized Trial.” Lancet 379: 1320–9.
115
Bandiera, O., R. Burgess, M. Goldstein, N. Buehren, S. Gulesci, I. Rasul, and M. Sulaiman. 2014. Women’s
Empowerment in Action: Evidence from a Randomized Control Trial in Africa.
Adoho, F., S. Chakravarty, D. T. Korkoyah, M. K. Lundberg, and A. Tasneem. 2014. “The Impact of an Adolescent
Girls Employment Program: The EPAG Project in Liberia.” Policy Research Working Paper 6832, World Bank,
Washington, DC.
116
Simavi, S., C. Manuel, and M. Blackden. 2010. Gender Dimensions of Investment Climate Reform: A Guide for
Policy Makers and Practitioners. Washington, DC: World Bank and IFC.

89
 business activities and sign contracts without their husbands’ permission, cultural
attitudes and lack of access to finance make this difficult in practice.117.

191. Finally, new technologies could be leveraged to free up women’s time and or counter the
negative impacts of their relatively lower geographical mobility (it has been documented that
women of certain ethnic groups are less likely to travel freely outside of their home villages).118
For example, mobile phones can allow women to access market or other information despite their
relatively lower geographical mobility. However, the benefits to women are not inevitable and
interventions must consider specific gender issues in their design. For example, in the case of
mobile phones, it is possible that men benefit more because they tend to have greater control over
household assets, they are more able to use mobile phones because of their higher literacy rates,
or because they have larger social networks that they can leverage with mobile phones.

6.5 Additional Research Suggested

192. The preparation of this document has allowed identifying some knowledge gaps to
formulate and implement an effective poverty reduction strategy. They are listed here.

193. The spatial focus of interventions. There is an urgent need to increase agricultural
productivity. Between 1990 and 2010, Niger’s population increased by 77 percent, with the largest
increases in population occurring in Maradi (2 million), Zinder (1.6 million), and Tahoua (1.6
million). This rapid population expansion places increasing stress on limited natural resources.
Only a small fraction (approximately 3.3 percent) of the country receives more than 500 mm of
precipitation, and although recent increases in rainfall have seen this area expand by 25 percent,
Niger’s expanding food needs may soon outstrip its agricultural expansion. Between the 1980s
and 1990s, the amount of farmland expanded faster (+51 percent) than the population (+37
percent), resulting in a net increase in per capita cereal production. Between the 1990s and 2000s,
however, the amount of farmland increased by 20 percent, whereas the population increased by 42
percent, resulting in a net decrease in food availability. By 2025, if Niger’s rapid expansion of
farmland slows while its yield growth remains stagnant, Niger’s projected population of 26 million
people could face substantial shortfalls in food availability. In the past, Niger has experienced
large, natural variations in mean rainfall on decadal time scales. If another natural rainfall decline
occurs, the impact of this dryness could be aggravated by the effects of warmer air temperatures.119
A study is suggested to identify those areas most at risk from the combination of population
increase, limited land availability, and climate change with a view of suggesting which
(combination of) interventions should be followed to address this vulnerability. The study could
extend the argument presented in Figure 6.6 that interventions could be spatially focused and
should be instrumental in identifying which type of interventions should focus where and could
facilitate the (spatial) allocation of projects.

117
Hallward-Driemeier, M. and T. Hasan 2013. Empowering Women. Legal Rights and Economic Opportunities in
Africa. World Bank. Washinton D.C.
118
Aker, J. C., C. Ksoll, and T. J. Lybbert. 2012. “Can Mobile Phones Improve Learning? Evidence from a Field
Experiment in Niger.” American Economic Journal: Applied Economics 4 (4): 94–120.
119
FEWSNET. 2012. A Climate Trend Analysis of Niger. http://www.fews.net/west-africa/niger/climate-
change/june-2012.

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194. Transfering scientific knowledge to farmers on how to increase yields effectively and
at scale needs investigation. The SCD has pointed to the disconnect that exists between
knowledge present in research stations and what farmers practice. Box 6.1 has offered some
illustrations of farming practices that are doable and have high returns but which are not applied
at scale. How to ensure that farmers improve their productivity a context where extension services
are understaffed and underqualified (skills) and where farmers are largely illiterate deserves
investigation. The SCD has suggested to invest in the expansion of extension services. However,
agricultural extension has not had a stellar history. A review prepared by the World Bank in 2007
concludes that World Bank interventions have had a significant positive development impact, but
maintains that serious deficiencies persist in most of the supported national systems particularly
with respect to the sustainability agricultural of institutions and systems developed under World
Bank projects is of particular concern. 120 More recent impact evaluations suggest that the impact
of extension can be substantial and suited for targeting to women and producers with limited
literacy.121 Yet a systematic evaluation of 92 impact evaluation of farmer field schools concludes
that in small-scale or pilot programs, farmer field schools lead to improved knowledge and
changed agricultural practices, while the few evaluations of large scale programs showed that such
programs are not effective in the longer term. They also found that non-participating neighboring
farmers do not benefit from diffusion of knowledge from farmers who participate; suggesting that
farmer field schools may not be cost-effective compared to more traditional extension program.
Others arrive at different conclusions: Hansen and Duveskog (2012) find that participation in
farmer field schools empowered people by building the capacity of local people to make choices
and make decisions that ultimately lead to increased uptake of agricultural innovations, access to
services, and market access as well as collective action. 122 A major conclusion of their study is that
agricultural development programs should focus more on processes of empowering farmers as
opposed to technical solutions that characterize most programs, in order to create an appropriate
mix of technological and social advancement for a development process that is sustainable in
nature. As there is ample evaluation material available, it is suggested to prepare a review on the
effectiveness of different kinds of agricultural extension services, with specific reference to
identifying approach that could be effective in Niger: i.e an environment with low levels of literacy
and low levels of farmer organization in particular where interventions at scale are needed.

195. As it is needed to better understand how to do extension effectively, it is equally

needed to understand why small scale solar irrigation has not yet taken off. The SCD suggests
that small scale solar irrigation is the equivalent of “big bills left on the sidewalk”. Hence the
question is legitimate why, of this is such a great solution, it has not been taken up yet at scale. In
Niger, that is, as in countries like Kenya it has.

120
Dennis L. Purcell and Jock R. Anderson (2007). Agricultural Extension and Research. Achievements and Problems
in National Systems. World Bank Operations Evaluations Study.
121
This evaluation of a farmer field school project amongst small-scale farmers in East Africa found that participation
in farmer field schools increased income by 61 percent. Participation improved agricultural income and crop
productivity overall K. Davis, E. Nkonya, E. Kato, D.A. Mekonnen, M. Odendo, R. Miiro and J. Nkuba (2012). Impact
of Farmer Field Schools on Agricultural Productivity and Poverty in East Africa. World Development, Vol. 40(2):
402–413. http://dx.doi.org/10.1016/j.worlddev.2011.05.019.
122
Esbern Friis-Hansen and Deborah Duveskog (2012). The Empowerment Route to Well-being: An Analysis of
Farmer Field Schools in East Africa. World Development Vol. (2) 40:414–427.
http://dx.doi.org/10.1016/j.worlddev.2011.05.005.

91
196. The process of urbanization is another area in need of further investigation. The SCD
has noted the scope of urbanization for growth and poverty reduction. It has also noted that Niger
seems to be under-urbanized and pointed to the fact that forced migration could accelerate
urbanization at any time. Knowledge about the current process of rural-to-urban migration as well
as about (bottlenecks to) urban growth and how urban growth translates into poverty reduction is
very limited.

197. Inform core policy reform with analytical work. The SCD has made clear how policy
reform is urgently needed to remove obstacles to growth and poverty reduction. Identified were
trade reform and improvements to the business environments, reform in the delivery of agricultural
inputs and services, and reforms in the way social protection is provided or with respect to PFM
and public investments (a Public Investment Management Assessment [PIMA] and revenue
collection (tax exemptions; mining taxation) would be recommended in view of the performance
of past major public investment schemes).123 As many public services are offered through state-
owned enterprises, and as many services are inadequate, they too should be considered an object
of reform. Before initiating reform, it is suggested to prepare in-depth analytical work, as the
political-economy landscape is too complex and too personalized to pursue run-of-the-mill
solutions (see Box 6.1): who are the key actors, how do the poor benefit from their services at
present, how effective is the service delivered, what alternatives exist, how can they be brought
about (through policy reform or otherwise), and who might support and who would oppose the
proposed reform. In-depth analytical work combines sector-specific knowledge with information
on governance. To motivate the reforms, they could be combined with detailed information on
how the poor do, or do not, benefit from the activity at present as poverty reduction remains the
lens through which the effectiveness of policy reform should be judged.

198. Public Expenditure Review (PER) of spending on agriculture. The Niger Government
has realized the importance of increasing the productivity in agriculture as evidenced by the launch
of the 3N Initiative (the Nigeriens Nourish the Nigeriens Initiative, or I3N) in 2011. The initiative
is coordinated by a High Commission. Its objective is to build national capacities with regard to
food production, supply, and resilience to food crises and disasters. The program is a flagship
program and Niger has earmarked 25 percent of its budget to it. The initiative includes 5 priorities
and 12 key programs that seek to diversify agricultural, livestock, and forestry production to
increase yields, irrigate more land, enhance market supplies, improve crises and disaster responses,
and fight malnutrition. The various programs are potentially critical to address the area of
constraints related to increasing agricultural productivity. However, information about the
effectiveness of I3N and the implementing agencies (typically ministries) is scant. Proposed is a
public expenditure review that focuses on spending in agriculture which considers the institutional

123
PFM reform could be motivated by considering the equity effects of public finances. The SCD has pointed out
the degree to which redistribution can potentially contribute to poverty reduction, either through cash transfers or
increased social spending. At present, little is known about the redistributive aspect of the budget. On the revenue
side, much revenue is (virtually) raised from poor households as it comes from mining or in the form of aid. On the
spending side, much is allocated to social sectors or sectors that benefit all households (such as security or justice),
but how this benefits poor and nonpoor households is less evident. After all, nonpoor households also send their
children to school, so not all social spending can be considered pro-poor. A CEQ (Commitment to Equity) analysis
can shed light on the redistributive aspects of the budget and provide a point of departure for identifying the need
and scope for improved redistribution.

92
layout (including coordination by 3N), past and expected funding and results achieved, and the
allocative efficiency and effectiveness of spending.

199. An agricultural PER should also seek to explore why technical services, including
those in agriculture and community services, have received so little state support. In
contradiction to widely held beliefs about the ‘retreat of the state’, the gendarmerie and health and
education sectors have grown in size in recent years. Other sectors, on the other hand, are in decline
or are seeing their activities scaled down or revamped. In some cases, their actors in the field are
completely lacking resources and are therefore discouraged and unmotivated. In technical services
such as sanitation, community development, livestock farming, agriculture or adult literacy—at
both municipal and department level—there is generally only one actor (sometimes with a backup,
usually a civic service worker), who lacks the necessary means to carry out his/her mission (having
neither a vehicle, petrol, nor professional expenses) and who hence has nothing to do except wait
for the miraculous arrival of a possible ‘project’ (funded by a development agency) that will come
to his/her aid.124

200. The pursuit of local solutions requires local knowledge. A critical conclusion of the
SCD is that greater efforts need to be made to find local solutions that reach citizens directly.
Doing so effectively will require more local knowledge at the program design stage. How do
stronger local organizations contribute to poverty reduction, for instance? It has been argued that
stronger local organizations improve resilience to conflict and climate change and can be
instrumental to overcoming market-access constraints. Local organizations can be vehicles for
literacy programs or social safety net interventions and could strengthen local accountability: how
local organizations could do so; what type of organizations might be supported (NGOs, school
committees, faith-based organizations, farmer groups, savings groups); and how best to support
these organizations in ways that avoid elite capture or accountability toward donors instead of
members, need to be investigated. Similarly, micro-irrigation is promising because it increases
yields and reduces vulnerability to drought, but how to introduce it in such a way that the poorest
(who may be landless) benefit, and how to ensure that women (who typically are not the proprietor
of the land that is irrigated) benefit as well? Off-grid solar systems may offer local energy
solutions, but how to make sure that these systems also benefit the poor? Such questions are not
new to the World Bank, but they become particularly pressing when more direct engagement of
citizens is envisaged. Additional research that ensures the knowledge on governance (elite
capture), poverty (targeting), and social development staff (local solutions) is available to teams
designing projects to help them design better projects.

201. It is important to investigate what is needed to arrive at a more efficient logistics

system. Low transport cost and access to all-weather roads seem critical for growth and poverty
reduction. Yet, a better understanding of the impact of improved logistics on poverty reduction
and the conditions under which reduced transport costs are most effective for reducing poverty is
pertinent. To develop an efficient transport system, the various costs and benefits need to be better
understood so that informed trade-offs can be made between different transport modalities (air,
rail, roads) and within modalities between types (trunk, feeder, and rural roads). In addition, more
evidence is needed to identify where investments are justified, where transport costs can be

124
Jean-Pierre Olivier de Sardan. "The Delivery State in Africa. Interface Bureaucrats, Professional Cultures and the
Bureaucratic Mode of Governance.” Mimeo.

93
reduced through policy reforms alone, or where a combination of both investment and policy
reform is needed.

202. The land question needs attention. Productive land in Niger becomes increasingly scarce,
and a lack of security of tenure can be a critical obstacle to growth and poverty reduction. Security
of tenure is important for various reasons: to protect against land-grabbing and displacement,
ensure sustainable land management, increase investments, mitigate the consequences of climate
change, avoid speculation, and address conflicts between pastoralists and farmers. The land issue
is multilayered and varies by geographical location. In rural areas, tenure rights are based on the
1993 Rural Code which recognizes traditional land ownership. This legislation provides for land
management by local land commissions and an affordable and short process to secure tenure rights.
However, a 2013 audit noted how very few titles have been issued, either because land
commissions were not set up or remained under staffed or because beneficiaries in rural areas are
not interested in formalizing their tenure rights. A study to assess these aspects, including the
adequacy of the legal framework with respect to irrigated land, (peri)-urban land and pastoralist
corridors, and options to address any eventual shortcomings therein, is recommended.

Box 6.3: Not all interventions are equally politically attractive

Not only policy reforms should be assessed for their political feasibility. Different activities also differ in the types
of political dynamics they attract. There are predictable reasons why a service such as hospital health care is likely
to raise different levels of political support compared, for example, to urban water supply. At least part of the
explanation lies in the characteristics of these services. At their core, these characteristics concern the nature of the
good being delivered, the type of market failure being addressed, the tasks involved in delivery, and how a service
is demanded and consumed.
Politicians’ incentive to provide or improve a service is greatest where it offers exclusive and targetable private
rather than public benefits (for example, social protection rather than sanitation); where it benefits users directly
rather than through external effects on the wider population (bed nets rather than disease vector control, fertilizer
vouchers rather than quality control of imported inputs); and where citizens have information to understand the
benefits and results are visible in the short term and can therefore be clearly attributed to politicians’ action (for
example, construction of schools rather than improvement of teaching standards).
Policy makers and managers are more able to monitor and control providers where the providers do not have a high
degree of professional dominance and where they exercise relatively little discretion (as in standard procedures for
vaccination); where procedures and outputs (for example, infrastructure construction) are easily specified and
measured; where the service delivered is a public good offering few opportunities for disruptive rent-seeking (for
example, public health campaigns); and where managerial information is accessible because the service offers
direct benefits (rather than external effects) to definable clients within clear territorial boundaries.
Users’ power and capacity to organize collectively is greater where a service is used frequently and predictably
within a limited territory (for example, irrigation schemes or primary schooling by comparison with hospital health
care) and users are able to assess the quality of the service, allowing the formation of shared opinion and demands;
where there is choice rather than monopoly in supply; and where the service offers easily visible and short-term
benefits to known beneficiaries (a health center rather than a public health campaign). However, collective
organization is easily diverted by users’ competition for private benefits (such as access to water in irrigation
schemes) that can be targeted to favored people at the discretion of the provider.
Together, service characteristics affect the political salience of a service. Based on this framework, small-scale
irrigation could be expected to have a high rating for political salience because it is both easily attributable to
political effort (targetable, visible, and measurable) and presents possibilities for organized demand (frequently and
predictably used within a limited territory). Primary education is not easily attributable after the initial construction
of a school has been accomplished, but its predictable and territorial usage may foster organized demand for
sustained improvement. Tertiary (hospital) health care may, similarly, be most politically attractive in the
construction phase but offers a much weaker basis for sustained demand for quality treatment. Programs of
preventive health care, fertility control, and community sanitation have strong public good qualities but produce

94
personal benefits that are not easily understood or visible except in the long term; they present the dilemma of
requiring a public health crisis or a bold political gamble before conditions are created for any visible political
payoff.
Recognizing that services have their own profile can help identify the political feasibility of interventions.
Comparing the ‘theoretical’ profiles with what happens on the ground may also help identify avenues for
interventions. For instance, if it is found that farmers are not organized, whereas being organized improves
productivity, may help shape intervention mechanisms that bring them together—such as extension vouchers that
need to be pooled to pay for (jointly identified) extension services.
Source: Adapted from Batley and Mcloughlin (2015). The Politics of Public Services: A Service Characteristics
Approach. World Development vol. 74: 275-285.

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Annex 1: Ordinary Least Square Regression of Log per Capita Consumption
(1) (2) (3) (4) (5)
National Urban Rural Agricultural Agro−Past
Household composition
Number of children below 4 −0.091*** −0.100*** −0.086*** −0.069*** −0.106*
Number of children ages 5−9 −0.096*** −0.100*** −0.095*** −0.098*** −0.090*
Number of children ages 10−17 −0.042*** −0.049*** −0.035*** −0.031*** −0.034*
Number of female adults 0.006 −0.011 0.019 0.039* 0.032
Number of male adults −0.042*** −0.039*** −0.049*** −0.081*** −0.049*
Head demographics
Head is female (Yes) −0.079*** −0.040 −0.096*** −0.106* −0.096*
Age of head −0.005* −0.011* −0.006* −0.011* −0.006
Age squared 0.000 0.000 0.000 0.000* 0.000
Head Sectors (agriculture is omitted)
Services 0.122*** 0.111** 0.052 0.018 −0.016
Industry 0.264*** 0.236*** 0.230*** 0.205*** 0.309**
Other 0.126*** 0.102** 0.121*** −0.002 0.196**
Head education (no education is omitted)
Primary 0.102*** 0.129*** 0.051* 0.005 0.072*
Secondary 0.211*** 0.231*** 0.114*** 0.107 0.120*
Tertiary 0.610*** 0.644*** 0.505*** 0.597** 0.565
Head ownership
Own house −0.007 0.057** −0.105** −0.151** −0.026
Own agriculture. land 0.016 0.006 0.038* 0.024 0.141**
Connected to water pipe 0.120*** 0.086*** 0.085*** 0.111*** 0.094**
Connected to grid 0.443*** 0.402*** 0.376*** 0.330*** 0.283**
Regions
Agadez −0.032 −0.098 −0.030 0.194**
Diffa −0.147*** −0.196*** −0.167*** −0.159***
Dosso −0.239*** −0.391*** −0.233*** −0.172*** −0.102**
Maradi −0.108*** −0.225*** −0.110*** −0.063 0.027
Tahoua −0.199*** −0.449*** −0.184*** −0.010 −0.126*
Tilaberi −0.111*** −0.274*** −0.098*** −0.155*** 0.070
Zinder −0.039 −0.201***

Constant 12.756*** 13.130*** 12.819*** 13.014*** 12.448*

Observations 3,728 1,410 2,318 872 856
R−squared −0.599 0.587 0.301 0.284 0.382
Source: Staff estimations using LSMS-ISA 2011.
Note: Standard errors in parentheses: *** p < 0.01, ** p < 0.05, * p < 0.1.

96
Annex 2: Additional CGE simulations
Investing in education

1. Greater education attainment supports economic growth and benefits low-income

households in the long term. Having a more skilled population expands the economy’s
productive capacity. A 1 percent increase in skilled workers supports a 0.21 percent boost in
GDP.125

2. As expected, boosting investment in education would be progressive. The consumption

of poor households increases by 0.3 percent relative to the baseline as wages rise. An increase in
the supply of skilled workers lowers the wage of skilled workers by around 2.5 percent relative to
the baseline. Similarly, a reduction in the supply of unskilled workers increases the wages of
unskilled workers by about 0.2 percent. In the long term, since skilled workers earn higher wages
than unskilled workers, aggregate incomes are higher and this supports greater consumption. 126

Public expenditure options

3. Increases in nonproductive public expenditure that is funded by debt leads to a

contraction in economic activity in the long term.127 Two possibilities are analyzed, one where
there is an increase in defense spending of about 1 percent of GDP and another where there is an
increase in public investment of about 1 percent of GDP. Relative to the baseline, GDP falls by
1.1 percent in the case of defense spending and by 1.8 percent in the case of public investment.

4. In both cases, the additional expenditure leads to a deterioration in the Government’s

budget balance. This occurs not only because of the direct expenditure increase but also because
of the additional debt servicing costs. The economy contracts as a result of the deterioration in the
Government’s budget balance. The additional Government debt ‘crowds out’ private investment,
lowering the economy’s capital stock and productive capacity.

5. The reduction in incomes as a result of a lower capital stock disproportionately affects

poor households. A lower capital stock reduces the productivity of land and labor. In contrast,
since capital has become scarce, its returns increase. Capital ownership is weighted toward richer
households, so the reduction in their consumption is more muted than poor households. By 2030,
the boost in public investment lowers the consumption of poor households by 2.6 percent and the
boost in defense spending lowers it by 3.1 percent.

125
The cost of education has not been considered in the simulation, so these results can be interpreted as the upper
end of possible effects.
126
The model probably ignores the social returns to human capital or human capital externalities. A number of papers
show that a large concentration of higher skilled workers raises the wages of higher skilled workers modestly and it
increases the wages of lower skilled workers even more Enrico Moretti 2010. Local Multipliers. American Economic
Review: Papers & Proceedings 100: 1–7. doi=10.1257/aer.100.2.1.
127
The results of this simulation are sensitive to assumptions regarding productivity benefits of government
investment. In this instance we assume (in the extreme) that an increase in government investment has no
productivity benefits. The benefits of government investment need to be examined on a case-by-case basis using, for
example, cost benefit analysis. Similarly, the benefits of better security and stability from defense expenditure has
not been captured.

97
Adverse weather events

6. A drought disproportionately affects poor households since they derive most of their
income from agriculture. The fall in agriculture productivity causes GDP to be around 5 percent
lower in 2020.128 The severe drought increases the price of agricultural products and lowers output
from the agriculture industry. The fall in incomes causes consumption of poor households to fall
by around 10 percent.

128
The adverse weather shock is proxied using a fall in agriculture productivity in 2020. A study by Brown et al.
(2011) found that a 1 percent increase in the area of a country experiencing severe drought lowers GDP growth by
4–7 percent. Notably, this simulation does not capture any policies that alleviate the effects of drought on
households (for example, foreign aid).

98
Annex 3: SCD Consultations
1. SCD consultations took place from September 19–23, 2016. The team had a total of 15
meetings with the staff from the Ministries of Planning, Mining, Agriculture and Livestock,
Health, and Education; traditional leaders; parliamentarians; representatives from NGOs dealing
with gender and leadership, budgetary oversight, and energy; private sector leaders; and staff from
research institutions as well as representatives from bilateral and multilateral donor organizations.
The team had the opportunity to visit a health center outside Niamey and an irrigation scheme in
Niamey.

2. At each meeting, an overview summary of the SCD was presented,129 along with the three
core constraints identified: (a) low rural productivity; (b) limited human capital and high levels of
vulnerability; and (c) poor governance resulting in limited business opportunities and inadequate
service delivery. Discussions focused on the relevance of these constraints as well as on
approaches on how to address them with propositions to rely more on interventions that directly
reach citizens with money (cash transfers, e-vouchers) or information (alphabetization, agriculture
extension, local health workers), relying more on technological innovations (mobile phones, solar)
and approaches that align incentives with service delivery (results-based financing, private sector
provision) or that can change people’s behavior (early marriage, hygiene, sexuality, nutrition). The
need to strengthen the capacity of the central state was stressed, particularly in priority areas (ilots
d’excellence).

3. The consultations confirmed the various challenges Niger is facing, most of which are
identified in the SCD summary. The need to ‘modernize rural areas’ was emphasized as was the
criticality of irrigation and alphabetization. Population growth was mentioned often and related to
the low quality of education (it is hard to keep up), the emergence of a landless class (40 percent
in Maradi), and rapid urbanization (it leaves visible traces in Niamey).

4. Security, security of tenure, the recession in Nigeria, and the devaluation of the naira were
emphasized. In spite of the many challenges Niger is facing, the consultations brought out the
existence of ample opportunities in different domains. Private sector representatives pointed to the
presence of many business development opportunities; research institutions confirmed the
existence of productivity-enhancing technologies; and public sector officials confirmed how
service delivery was improved through privately provided extension services (to onion producers)
and pilots with results-based financing.

5. It was noted how there is a disconnect between policies (which are often well defined—
that is, 3N) and their implementation (which tend to lag behind), a disconnect that is often not due
to the absence of funding but which is due to limited capacity and inadequate incentives. It was
noted that addressing these challenges would require a gradual process that might take a long time
to bear fruit. It was noted that in certain areas, centers of excellence already exist. The urgency of
addressing implementation was recognized by the authorities as well as by partners. It is evidenced
by the slow maturation of a number of large projects such as the Soraz oil refinery, the rails
connecting Niamey to Benin, the Kandaji dam, the Imouraren uranium mine, and the Tahoua

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All participants had received a summary of the SCD with the invitation to the meeting.

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region coal project. Each of these projects take a long time to complete and yield little or no return
(yet).

6. It was noted how there exists a joint responsibility (fewer pilots, more coordination) to
ensure that implementation improves.

7. A number of salient points brought up during the consultations are described here.

Public services

8. The challenge that population growth poses for service provision was laid out by the
Ministry of Education which demonstrated that to maintain attendance rates at the same level, each
year an additional 3,000 classrooms have to be constructed and 3,500 teachers recruited. The low
quality of education was also brought up. Low quality has many spillover effects, for girls in
particular, who are pulled out from school (as they learn very little) and married off (50 percent of
girls age 16 are already married). Low education quality was associated not only to reliance on
inadequately trained teachers (often contractors but also to high levels of absenteeism and the fact
that teaching is considered a job of last resort. The fact that parents themselves are not educated is
a constraint as well, as is the fact that in many places it is not safe for a girl to walk to school
(alone). Addressing the low quality of education would need to start with raising the level of
education of teachers; hence, the urgency to invest in professional training. Improved school
inspection, teaching in the local language, testing and retraining teachers, and greater reliance on
information technology were also offered as approaches that could help improve quality.

9. In other meetings it was stressed how the education system was in urgent need of reform.
“Already there is a lost generation that is seriously under-educated. At present things keep moving
because the older generation is better educated. But what if they leave?” Urgent measures were
needed, and even getting teachers from neighboring countries to temporarily make up the shortfall
was on the table.

10. With respect to health, it was noted how marked progress had been made—particularly in
reducing child mortality. Yet, overall the state of health remains problematic: high levels of
population growth, high maternal mortality, high levels of malnutrition, low quality of services,
unequal placement of staff (mostly based in Niamey), and inaccessible services (less than 50
percent of the population lives within 5 km of a health center) were all brought to the fore. It was
pointed out that in certain areas, insecurity presents a major constraint (presence of Boko Haram).

11. It was recognized that much progress can be made through improved preventative health
services delivered by commune health workers. These commune health workers should focus on
behavioral change (a very conservative culture was identified as a major constraint) with respect
to fertility, hygiene, nutrition, the treatment of simple diseases (like diarrhea), or the identification
of cases in need of referral. Commune radio could complement this. Creating a system of commune
health workers is a priority for the ministry, but bringing it to scale (some 20,000 workers are
needed) is a challenge. Workers who are presently volunteers will need to receive a stipend to keep
them motivated, creating incentives that might attract the better connected rather than the most
suited. Supervision and a gradual rollout while learning lessons was recognized as key to success.

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12. It was recognized that results-based financing has much potential to improve health
services in facilities. Successful implementation will require investments in supervision and
reliable mobile phone networks (for monitoring). Modern technologies also offer other
opportunities to improve health services, for instance, by giving commune health workers the
(electronic) tools to diagnose (e-health).

13. A strong case was made for improved coordination with other sectors, as access to safe
water, transport, and (solar) electricity are all critical to a well-functioning health system. To this
end, the Ministry of Planning was urged to strengthen its coordinating role. In a similar vein, the
Ministry of Education was urged to improve the quality of education as the general level of
education was perceived as a major factor holding back the quality of medical training.

Governance
14. A number of governance problems were brought to the fore, starting with a political class
that is self-interested (ils ne sont pas des bons patriotes), focused on Niamey, and not renewing
(the same people have been there for 25 years; continued reliance on service provision by the
public sector). It was noted how a bureaucratic culture exists in which decisions are made by the
‘chef’ who use their position of power to extract personal benefits (‘privatization of the public
service’). As a consequence, people without adequate competencies get appointed and the
bureaucracy itself becomes highly politicized. Priorities change and programs stop as soon as
ministers change—which happens frequently. When controlling bosses are absent, units largely
stop functioning.

15. The absence of a ‘modern’ Government with a clear vision that is being implemented was
lamented. Reference was made to the Central Government as ‘weak, a water head’. With reference
to public education and its low quality and high levels of teacher absenteeism, but also to the fact
that policies are implemented and quickly reversed (for example, forcing teachers out of Niamey
to rural areas), it was suggested the Central Government may even be losing its relevance.
Questions were raised about the objectives of the ongoing decentralization process and the
likelihood of it succeeding. It was noted that decentralization seemed more driven by the desire to
reduce the power of traditional chiefs than by the wish to improve the quality of service delivery
at the local level.

16. Not all considered the state as weak and incompetent. Successful elections and the ability
of the state to effectively prevent the presence of terrorist groups on its territory were mentioned.
The ability of the military to wage war on three fronts (Mali, Libya, and Nigeria) was appreciated,
along with the fact that this was done while upholding human rights: “Unlike others, the army of
Niger takes prisoners.” That slow bureaucratic procedures meant that some evidently innocent
prisoners had to wait a long time to be released was considered an unfortunate result of a war
waged by a state with low capacity.

17. Researchers stressed the presence of local knowledge and local institutional capital from
which development activities could and should benefit. Emphasis was placed on participatory
approaches and local initiatives (small-scale irrigation as opposed to large-scale; local water
companies serving 3–5 villages). It was noted that traditional chiefs (some 20,000 in all) could
present an important complement to the state. It was argued that 80 percent of the population is
already governed by these leaders rather than by the representatives of the modern Government. It

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was noted that the ‘chefferie’ has evolved over time, with many former civil servants now being
chiefs. At the same time, it was recognized that there might be downsides to relying more on
traditional chiefs, as in some areas they are instrumental to maintaining existing inequalities.

18. Reference was made to the low levels of trust between people and between people and their
institutions: “There are too many conflicts, between people, between people and their institutions
and too little readiness to collaborate for the greater good.” Reference was equally made to the fact
that society is changing rapidly, in the sense that individuality is on the rise (69 percent of the
population is less than 25 years old), and the consequences this may have on an otherwise
traditional society.

19. It was recognized that while local approaches should be strengthened, this will need to be
done in a context where the overall functioning of the state is strengthened. Islands/poles of
effectiveness, gradual approaches, and a focus on (continuous) education were brought forward as
elements critical for such a transformation path. “Rapid solutions do not exist.” Strengthening
feedback loops and more flexible project design that can adapt to feedback was emphasized, as
was the need to collaborate with independent researchers who could offer project teams honest
feedback and critical thinking, even though this was not always appreciated.

20. With respect to accountability functions, members of parliament highlighted the

difficulties they face playing their role. Limited access to information, party loyalty, and cultural
obstacles (women have difficulty interrogating men in positions of power) limit the ability to hold
the executive to account. It was noted how members of parliament lack funds which, in turn, limits
their ability to hire staff or to carry out supervision missions: “When we want to supervise a project,
we ask for petrol from the minister of the project we intend to supervise.”

21. It was noted that parliament uses its powers not always effectively. Parliament approves
the budget even though the budget fails to provide it with the means needed to do its job.
Parliament approves all World Bank projects but fails to follow up and request information about
implementation. Parliament can initiate laws, but this power is rarely used. Some of the
parliamentarians seemed to have abandoned the idea of holding the executive to account
altogether. Rather than trying to ensure that the executive implements activities effectively, they
preferred to initiate developmental activities themselves—in their own constituencies that is. This
helps them get reelected and to ensure “something tangible is left behind.”

Private sector development:

22. It is evident that there is much unmet potential for private sector growth. There is only a
24 percent penetration rate of mobile phones; improved seed is not available in many markets; the
flour mills are able to meet only 60 percent of local demand; there is much unmet irrigation
potential; and the comparative advantage in meat and milk production is not exploited as abattoirs
and milk producers have difficulty getting a steady supply (that is, promote sedentary livestock
keeping). It was argued that a new geological survey would allow the country to diversify its
(mining) products and producers. While the immediate relevance of mining for poverty reduction
may be limited, the indirect impact through its contribution to revenue could become even more
substantial than it already is. Less known is the fact that many small-scale gold miners are also
active. The sector is quite large and could benefit from greater levels of formalization and support
in their development. Presently much of the gold is illegally exported and levels of mechanization

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are limited. The Ministry of Mines estimated the number of small-scale gold miners at 500,000;
others put their number at closer to 200,000.

23. Constraints identified include a constrained business environment and a public sector that
favors public sector execution over implementation by the private sector. More concretely, access
to finance, complex tax requirements, and changes in taxes following the adoption of the budget
were mentioned. The latter was well illustrated with the case of value added tax (La taxe sur la
valeur ajoutée, TVA) which acts as a deterrent to purchase agricultural inputs locally. As most
suppliers do not have a tax number, it is easier (and cheaper) to import as this way one is exempt
from paying taxes. If one buys locally, one is forced to pay VAT (7 percent on inputs purchased!).
To the participants, this illustrated how the state is incapable of implementing its own vision (in
this case, agro-industrial transformation) in a coherent and consistent manner. Another illustration
is the taxation of mobile phones as luxury goods (40 percent import tax), effectively putting mobile
phones out of the reach of many consumers and hindering the expansion of mobile telephony. High
tax rates now prevent higher tax collection in the future as growth is constrained.

24. A number of other constraints were identified: security of tenure around Niamey; limited
coordination between private sector entities; the inability to collaborate well with the state and
explore synergies (for example, extension services and seed production by smallholders); high cost
of imports—due in part to informal payments; the inability of the professional training system to
deliver what the market demands (we have enough accountants!); and the depreciation of the naira
leading to the market being flooded with Nigerian products (animals for Tabaski, soft drinks).

25. A positive aspect was the investment code which all participants deemed very conducive
to investment.

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