Language: English Original: French

AFRICAN DEVELOPMENT FUND Structural Adjustment Programme (SAP V) Country: NIGER

COMPLETION REPORT

GOVERNANCE & ECONOMIC AND FINANCIAL REFORMS DEPARTMENT (OSGE) December 2008

Evaluation Team

Team Leader: Mr. B.I. BOUABDALLI, Principal Economist OSGE.2 Members: Issa FAYE, Senior Economist, OSGE.2 Mr. S. IBRAHIM, Consultant Sector Director: G. NEGATU, OSGE Country Director: J. K. LITSE, ORWA

Peer Reviewers

G.W. BENE-HOANE, Lead Economist, ORNB Racine KANE, Chief Economist, ORCE Abdoulaye COULIBALY, Financial Governance Expert, OSGE1 Mouhamadou DRAME, Senior Country Economist, ORWA Pascal YEMBILINE, Senior Country Economist, ORCE

TABLE OF CONTENTS

List of Annexes, Currency Equivalents, Acronyms and Abbreviations iii Basic Programme Data vi-vii Logical Framework Matrix viii-x Executive Summary xi-xv I. INTRODUCTION 1 II. PROGRAMME OBJECTIVES AND FORMULATION 2 2.1 Programme Objectives and Description 2 2.2 Programme Origin and Formulation 2 2.3 Preparation, Appraisal, Negotiations and Approval 2 III PROGRAMME IMPLEMENTATION 3 3.1 Effectiveness 3 3.2 Disbursement of the Tranches and Modifications 3 3.3 Implementation Schedule 4 3.4 Matrix of Programme Measures 4 3.5 Reporting 6 3.6 Procurement of Goods and Services 6 3.7 Financing Sources and Disbursement of the Grant Tranches 7 IV PROGRAMME PERFORMANCE AND OUTCOMES 7 4.1 Institutional Performance 8 4.2 Management and Organizational Performance 8 4.3 Capacity Building and Further Training of Professionals 9 4.4 Economic Performance 10 V PROGRAMME IMPACTS 10 5.1 Social Impact 10 5.2 Impact on Gender 10 5.3 Environmental Impact 11 5.4 Impact on Regional Integration 11 5.5 Assessment of Programme Risk 12 VI. SUSTAINABILITY OF PROGRAMME IMPACTS 12 VII PERFORMANCE OF THE BANK, DONEE AND CO-FINANCIERS 13 7.1 Performance of the Bank 13 7.2 Performance of the Donee 13 7.3 Performance of the Co-financiers 13 VIII OVERALL PERFORMANCE AND RATING 14 8.1 Relevance of Objectives and Justifications 14 8.2 Institutional Development 14 8.3 Sustainability 14 8.4 Overall Programme Performance 15 IX CONCLUSION, LESSONS AND RECOMMENDATIONS 15 9.1 Conclusion 15 9.2 Lessons Learnt from Programme Implementation 15 9.3 Recommendations 16 _________________________________________________ This report was prepared by Messrs. A. I. BOUABDALLI, Principal Economist, I. FAYE, Senior Economist, and a Consulting Macro-economist, following their mission to Niamey from 18 to 29 November 2008. Further questions on this report should be addressed to Mr. G. NEGATU, Director OSGE (Ext. 2077), and Mrs. M. KANGA, Division Manager, OSGE.2 (Ext. 2251)

LIST OF ANNEXES Annex 1 : Map of Niger (to be inserted) Annex2 : Matrix of Programme Measures Annex 3 : Performance of Donee Annex 4 : Performance of the Bank Annex 5 : Overall Programme Performance Annex 6 : Recommendations and Follow-up Actions Matrix Annex 7 : Macro-economic and Financial Indicators - 2005-2009 Annex 8 : Contribution of Donee Annex 9 : Negative List of Goods and Services for Procurement consistent with the

Appraisal Report Annex 10 : Sources of Information (Bibliography)

CURRENCY EQUIVALENTS

At Appraisal (March 2005) On Completion (December 2007 UA 1 = 1 SDR UA 1 = 1 SDR UA 1 = US$ 1.53199 UA 1 = US$ 1.58025 UA 1 = CFAF 758.030 UA 1 = CFAF 704.144 US$ 1 = CFAF 494.801 US$ 1 = CFAF 444.383

WEIGHTS AND MEASURES

Metric System

FISCAL YEAR

1 January – 31 December

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ACRONYMS AND ABBREVIATIONS

AFD : French Development Agency ARM : Multi-sector Regulatory Authority ADB : African Development Bank BCEAO : Central Bank of West African States WADB : West African Development Bank CAADIE : Autonomous Government Domestic Debt Amortization Fund CADP : Public Expenditure Adjustment Credit CAFER : Road Maintenance Financing Stabilization Fund CCM : National Tender Board EC : European Commission ECOWAS : Economic Community of West African States CENTIF : National Financial Information Processing Centre MTEF : Medium-Term Expenditure Framework CRFP : Public Finance Recovery Credit IHC : Integrated Health Centre DAAF : Administrative and Financial Director DCE : Public Dispute Settlement Directorate DGP : General Programme Directorate DGB : General Budget Directorate DGD : General Customs Directorate DGI : General Tax Directorate IPRSP : Interim Poverty Reduction Strategy Paper DMCE : Directorate of Money, Credit and Savings DSCN : Directorate of Statistics and National Accounts CSP : Country Strategy Paper ENBC : National Budget and Household Consumption Survey US : United States ADF : African Development Fund ESAF : Enhanced Structural Adjustment Facility CFAF : Franc of the African Financial Community IMF International Monetary Fund PRGF : Poverty Reduction and Growth Facility EMSG : Economic Management Support Group IDA : International Development Association INS : National Institute of Statistics MFP/T : Ministry for the Civil Service and Employment OHADA : Organisation for the Harmonization of Business Law NGO : Non-Governmental Organisation ONPE : National Post and Savings Office SAP : Structural Adjustment Programme PCE : Government Chart of Accounts PDDE : Ten-Year Education Development Programme PDS : Ten-Year Health Plan PEMFAR : Public Expenditure and Financial Accountability Review GDP : Gross Domestic Product PIMAN : Integrated Public Administration Modernization Programme of Niger

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SMEs : Small and Medium-Sized Enterprises SMIs : Small and Medium-Sized Industries TFP : Technical and Financial Partners HIPC : Heavily Indebted Poor Countries RDP : Public Expenditure Review AIDS : Acquired Immuno-Deficiency Syndrome FIS : Financial Information System SNC : Niger Cement Works PRS : Poverty Reduction Strategy CET : Common External Tariff TOFE : Table of Central Government Financial Operations VAT : Value Added Tax UA : Unit of Account EU : European Union WAEMU : West African Economic and Monetary Union HIV : Human Immuno-deficiency Virus

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BASIC DATA SHEET

1. Programme Name: Structural Adjustment Programme (SAP V) 1. Grant Agreement Number * 2100150010645 2. Donee Republic of Niger 3. Beneficiary Republic of Niger 4. Executing Agency : Office of the Commissioner for the Economy,

Ministry of the Economy and Finance, assisted by the Economic Management and Support Group (EMSG)

2. Grant Information

Estimated Actual 1. Grant Amount UA 18 million UA 18 million 2. Appraisal Date N/A From 12 to 25 March 2005 3. Negotiation Date June 2005 September 2005 4. Approval Date July 2005 21 September 2005 5. Signature Date N/A 21 October 2005 6. Effectiveness Date 3 December 2005 30 December 2005 Date Loan was Modified to Grant August 2006 7. Date of Supervision Missions - 1st mission: October 2005

- 2nd mission: March 2006 - Launching: 6 March 2006 - 1st supervision : 18/12/2006 - 2nd supervision : 15/11/2007

8. Date of Midterm Review September 2006 3 May 2007 9. Date of Audit Mission November 2005 and

November 2006 N.A†

10. Date of Government Completion Report

January 2007 N.A

11. Date of ADB PCR Mission April 2007 From 18 to 29 November 2008 12. Start-up Date September 2005 March 2006 13. Closing Date 30 June 2007 31 December 2007 3. Financing Sources

Financing Plan Estimated Actual UA Million % UA Million % IDA/World Bank 26.60 25.1 35.5 IMF 6.58 6.2 6.2 European Union 29.20 27.6 14.2 France 10.30 10.0 8.00 Belgium 6.98 6.6 0.2 Netherlands/Norway 2.74 2.6 NA AFD 5.03 4.7 3.3 Denmark 0.30 0.2 NA ADF 18.0 17.0 18.0 Total 105.73 100 NB: Data on outputs collected by the author from TFPs

* Initially in the form of a loan, the ADF’s contribution to SAP-V’s financing was converted into grant in August 2006

following Niger’s classification under the category of exclusively grant-eligible countries. † N.A = Not Available

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4. Disbursement of ADB Grant

Disbursement Estimated Actual Difference Date UA

Million Date UA Million UA Million

Effectiveness 3/12/2005 18.0 30/12/2005 18.0 0.0 Date Amount Date Amount 1st tranche August 2005 4.71 January 2006 8.49 + 3.78 2nd tranche October 2006 13.29 September 2007 9.51 - 3.78 Total - 18.00 - 18.00 0.00 5. Performance Indicators 1- Overrun on the Grant Amount (in %) No Overrun 2- Balance in % 0 3- Time Underrun/Overrun Slippage on effectiveness 27 days Slippage on completion date 6 months Slippage on last disbursement 6 months Number of extensions of last disbursement date 1 4- Programme Implementation Status Completed 5- Completion Indicator 31 measures implemented 3 measures in progress;

6 measures partly implemented and 3 measures not yet implemented

6- Institutional Performance Institutional Performance is satisfactory 7- Completion Report Not submitted to the Bank 8- Audit Report Not submitted to the Bank 6. Information on Bank Missions

Missions Dates No. of Missions

No. of Persons Composition Person/ Weeks.

1. Identification/ Preparation

N/A N/A N/A N/A N/A

2. Appraisal From 12 to 25/2005

1 2 Country Economist assisted by a Consultant

2

3. Supervision October.2005 and March

2006

2 1 Country Economist 1

4. Midterm Review 3 May 2007 1 1 Country Economist 1 5. Audit N/A None None None NA 6. PCR From 18 to

29 November 1 2 1 Economist from the

Bank and a Consultant 2

7. Disbursement Statement

Disbursement Appraisal Estimate Actual 1 Total Disbursement UA 18 million UA 18 million 2. Annual Disbursement 2006 2007

UA 4.71 million UA 13.29 million

UA 8.49 million UA 9.51 million

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STRUCTURAL ADJUSTMENT PROGRAMME MATRIX

Country : Republic of Niger Recap Date : March 2005 Design Team : Mr. A. CHARAF-EDDINE, Principal Economist, OCDW.2 and a Consultant, OCCW.2

Hierarchy of

Objectives (HO)

Objectively Verifiable Indicators (OVI)

Means of Verification (MOV)

Major Assumptions/Risks

Estimated Actual 1. Development Objective Contribute to reducing poverty and the achievement of the Millennium Development Goals

The poverty incidence estimated at 63% in 1994 will be halved by 2015. Outcomes reached and to be reached in 2000, 2002, 2004, 2006-2007 will be specified after the findings of the ongoing surveys.

Outcomes will be specified after the findings of the ongoing surveys.

National Statistics, PRA monitoring reports, findings of the CWIQ and ENBC surveys, findings of the survey on employment, the informal sector and consumption in Niamey, survey on satisfaction of basic needs (DSBE)

Political stability, resolve to continue the reforms Donor support

2. Overall Programme Goal Contribute to achieving sustainable economic growth with a view to reducing poverty

2.1. GDP reached 4.3% in 2007 compared to 0.9% in 2004 and 4.2% on average in 2005 and 2006 2.2. Inflation maintained at around 3% during 2005-2007 2.3. External deficit down from 7.3% in 2004 to 6.3% in 2007 2.4. Current account deficit down from –7.3% in 2004 to -7.2% in 2005, -6.9 in 2006 and –6.3% of the GDP in 2007 2.5. Gross enrolment ratio up from 46% in 2004 to 50% in 2005 and 59% in 2007 2.6 The girls primary enrolment rate up from 41% in 2004 to 42% in 2005 and 43% in 2007 2.7 The BCG immunization rate up from 76% in 2004 to 80% in 2005 and 95% in 2007, DTWP3 from 49% in 2004 to 51% in 2005 and 59% in 2007, Measles from 67% in 2004 to 70% in 2005 and 75% in 2007

- GDP growth rate was 3.2% in 2007 and 5.2% in 2006 - Inflation rate was 2.6% -The external deficit was 3.45% of GDP in 2007 - The current account deficit narrowed from -12.2% of the GDP in 2005, -10.9% of the GDP in 2006 and -10% of the GDP in 2007 - The gross enrolment ratio was 57.1% at national level, including 54.3% in the rural areas in 2007. It will reach 61% in 2008. - The girls’ enrolment rate was 47.4% in 2007. - DTCP3 coverage was 75% in 2007 whereas it was 92% in 2006. This drop in the rate can be explained by the 6-month stock outage of the DTWP antigen.

National Statistics, IMF National Statistics, CBWAS and IMF PDDE Implementation Report

2.1 Climatic conditions favourable and diversifications of sources of GDP growth and political will to maintain the pace of reforms 2.2 Idem 2.3 Idem

3. Specific programme objectives 3.1. Improvement of public financial management 3.1.1 Mobilization of resources 3.1.2. Greater efficacy and efficiency of public expenditure

3.1.1 Continued improvement of the tax and customs administration 3.1.2 Tax base broadened and financial authorities effective 3.1.3 Tax revenue reached 12.1% in 2007 against 10.5 in 2004 and 11 per cent in 2005 and 2006 3.1.2.1 Budget preparation improved because as of March every year the circular letter sent to the Technical Ministries 3.1.2.2 Technical Ministries consulted before

- Administrative type measures taken at the DGI especially to simplify registration procedures, decrease in the tax registration cost and drop in the tax rate as in those taken by the DGD to renew its management made it possible to reach a tax revenue/GDP ratio of 12.12% in 2007 - There has always been some slippage towards the month of April every year regarding the availability of the macro-economic framework. As a result the spending Ministries do not have enough time to prepare their budgets after receipt of the circular letter. - Yes the Ministries are consulted, but the format used to prepare the macro-economic framework is being revised

2.1.1 Climatic conditions 2.1.2 Political will 2.1.3 Institutional capacity of the Administration and political will 3.1.1 Will to coordinate and overt interest of the Technical Ministries in the exercise of preparing consistent sector strategies 3.1.2 Institutional capacity of the Administration and political will .

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Hierarchy of

Objectives (HO)

Objectively Verifiable Indicators (OVI)

Means of Verification (MOV)

Major Assumptions/Risks

Estimated Actual 3.2 Improvement of the expenditure programmes designed for poverty reduction 3.3 Strengthening the decentralization process

finalization of the ceiling letter 3.1.2.3. MTEF of sectors other than Education and Health prepared in keeping with the sector strategies 3.1.2.4. Integration of investment expenditure and current expenses into a single budget pursued 3.1.2.5. Budget regulatory mechanisms and cash flow plans strengthened with the participation of the Technical Ministries 3.1.2.6 Domestic debt reduced by implementing the debt settlement plan put in place 3.1.2.7 External debt monitored by the services concerned through the establishment of work stations set up on the new external debt management software. 3.2.1. Social services developed and quality services improved 3.2.1.1 Education 3.2.1.1. Financing requirements and expenditure structure reassessed in the context of the future MTEF in order to ensure balance between current and capital expenditures 3.2.1.2 : Short-term teachers recruitment policy pursued and 50% of expenses allocated to basic education 3.2.1.3 : Impact of education expenditures evaluated on the basis of the findings of the ongoing household surveys 3.2.1.4: Training of teachers strengthened and school maps used for a better geographic distribution of schools 3.2.1.2 Health: 3.2.1.2.1. Consistent and efficient reproductive health and population strategy defined and implemented 3.2.1.2.2 Policy for health services cost recovery and its impact assessed with a view to encouraging the use of the services, especially in rural areas 3.2.1.2.3 Credit allocated to drugs and vaccines increased and actual use of this credit monitored within the framework of budget regulation 3.2.1.2.4. Finalization of the health maps completed to facilitate a distribution of infrastructure and services that is more favourable to the poor and their use is encouraged

- Training courses are organized to enable the expansion of the MTEFs to other sectors such as Education and Health This is covered by the central government budget. But the current overall MTEF is partial because it is based on the SMTEFs of the Ministries which have them and only an estimate of those that are yet to be provided with them. - These mechanisms function indeed with the help of the Technical Ministries The domestic debt arrears clearance plan has been prepared and adopted. It will be implemented from 2008 to 2012 i.e. in 5 years - The debt management software used until 2006 is the CS-DRMS2000+ version 1.0 of the Commonwealth Secretariat. A new version 2.0 is currently being used to take into account the HIPCI and the MDRI. - Services improved in the context of the 2003-2007 PDDE and the 2005-2010 PDS. - The implementation of this exercise falls under the SMTEF, the last of which covered the 2008-2011 period. - The contractual staff recruitment policy is pursued and from 2005 to 2007, 9,579 short-term workers are recruited, including 855 who are certified. - A study on the level of satisfaction of beneficiaries and players with the education services is carried out on Basic Education. - The school map is used as of 1995 for the procurement of textbooks and school supplies, for the assignment of teachers, construction and equipping of schools -The sector strategy exists, is implemented and serves as basis for preparing the MTHEF Credit allocated to drugs and vaccines up from CFAF 1,990 million in 2006 to CFAF 4,999 million in 2007 and will reach CFAF 10,556 million in 2008. N/A

3.1.3 Political will to implement the reforms 3.1.4 Political will to conduct the budget management reforms 3.1.5 Political resolve to carry out the reforms and solve the issue of past arrears Idem 4. Political commitment to conduct the reforms Political stability Support of the population for the reforms Further dialogue and revival of the consultation commission with social and development partners

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Hierarchy of

Objectives (HO)

Objectively Verifiable Indicators (OVI)

Means of Verification (MOV)

Major Assumptions/Risks

Estimated Actual 4. Activities 4.1 Negotiate, approve and sign the financing agreements 4 .2 Speed up growth 4.3 Mobilize resources and keep expenditures under control so as to reduce poverty 4.4 Strengthen the decentralization process

3.2.1.2.5. Programmes aimed at encouraging the redeployment of competent staff to the rural area designed and implemented 3.2.1.3 HIPC: Single list of poverty reduction expenses defined to cover the HIPC expenses and the Treasury Expenditure Plan to enable enhanced poverty reduction 3.3.1. : Institutional framework for decentralization clarified and streamlined 3.3.2. : Diagnosis of current and projected donor interventions is established 3.3.3. National Decentralization Support Programme established 3.3.4 Studies on taxation, the growth potential of the local authorities and the possibilities for their mobilization carried out 3.3.5 Decentralization texts made operational (skills transfer, mechanisms for operating the Decentralization Support Fund and the Stabilization Fund, etc.) 3.3.6 Decentralization Observatory put in place Financing - IDA : UA 26.65 million - IMF : UA 6.58 million - ADF : UA 18.00 Million -E U : UA 29.20 Million - France UA 10.30 Million - Belgium : UA 6.98 Million -Denmark : UA 0.30 Million -Norway/Netherl. UA 2.74 Million - AFD : UA 5.03 million ____________________________ Total UA 10573 Million

Decree N° 2007-515/PRN/MSP of 22 November granting benefits and bonuses to doctors and dental surgeons according to area of activity is an answer to this concern A list of poverty reduction expenses is available; they are subject to special protection under the Regulatory and Treasury Plans. The institutional framework is taking shape with the creation of the Government’s High Commission for Modernization and Decentralization. This diagnosis has been made The Programme is yet to be established as a result of the delay in mobilizing the ADB resources under the Decentralization Support Project

Idem Creation of a bank for the local authorities planned. The Law has been voted, the enabling decrees having also been set out. - IDA : UA 35.5 million - IMF : UA 6.2 million ADF : UA 18.00 million - EU : UA 14.2 million France : UA 8.00 million - Belgium : UA 0.2 million -Denmark : NA -Norway/Netherl. : NA - AFD : UA 3.3 million

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EXECUTIVE SUMMARY INTRODUCTION 1. In 2002, the Government of Niger took the resolute decision to direct the reform policy on which it had embarked over ten years earlier, towards reducing poverty, the prevalence of which was estimated at 63% of the population in 1994. Against that backdrop, and in the wake of several structural adjustment programmes3, more or less successfully implemented, a fifth phase of these Structural Adjustment Programmes (SAP V) was designed following the adoption, in January 2002, of the Poverty Reduction Strategy. To implement this Programme, the Government sought technical and financial support from development partners including the African Development Bank.4 The latter replied favourably to the request from Niger’s Authorities by launching a new operation, SAP V, in the form of balance of payments support. PROGRAMME OBJECTIVES AND DESCRIPTION 2. On the basis of the strategic orientations of the PRS, and in accordance with the operational thrusts of the Bank’s Country Strategy Paper (CSP 2005-2009), the Programme set itself the overall objective of contributing to achieving sustainable economic growth to reduce poverty. The reform measures, as well as the performance indicators related to the specific objectives thereof, were covered by the two components of the said objectives namely: (i) Improvement of public finance management; (ii) promoting good governance, and enhancing monitoring-evaluation of the Poverty Reduction Strategy and the Programme itself. The 1st component aimed at intensifying internal resource mobilization, enhancing the efficacy and efficiency of public finance and improving the public expenditure programmes aimed at reducing poverty. The 2nd component aimed at promoting good governance, strengthening the decentralization process and improving programme monitoring-evaluation FINANCING SOURCES AND DISBURSEMENT OF THE GRANT TRANCHES 3. The Programme’s estimated financing was UA 105.73 million broken down as follows: IDA World Bank (26.60), IMF (6.58), European Union (29.20), France (10.30), Belgium (6.98), Netherlands/Norway (2.74), French Development Agency-AFD (5.03), Denmark (0.30), and ADF (18.00). The ADF grant was disbursed in two tranches of UA 8.49 million in January 2006 and UA 9.51 million in September 2007, respectively. The conditions precedent to the disbursement of the 1st tranche involved inter alia, submission to the ADF of evidence: (i) that the Government had adopted a plan to broaden the tax base, especially in relation to the informal sector; (ii) that the 2005 Core Welfare Indicators Questionnaire (CWIQ) had been launched; and (iii) that the decisions relative to building the capacity for coordination of the various Government structures involved in decentralization support on the one hand, and the institutional framework of the High Commission for Administrative Reform and Decentralization (HCRAD), on the other, had been taken. As to

3 Bank Group assistance to Niger in the area of policy based reforms involves five (5) non-project operations. These are

respectively the Structural Adjustment Programme (SAP I) in 1997, the Public Finance Reform Programme in 1998 (SAP II), the Structural Adjustment (SAP III) in 2001, the Structural Adjustment Programme (SAP IV) in 2003 and the Structural Adjustment Programme (SAP V) in 2006. These programmes for the most part focused on structural reforms (reforms of the civil service, the financial sector and privatisation of state-owned enterprises) and public financial reforms.

4 The expressions “the Bank” or “the ADB” are used later in the document to refer to the African Development Bank.

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the disbursement of the second tranche, it was subject to providing the ADF with evidence: (i) in a report, that the pilot computer room of the Ministry of the Economy and Finance had become operational; (ii) of the adoption of a national programme in support of decentralization, community and local development, based on the diagnostic study on decentralization; (iii) of the preparation of the 2006 MTEF for the rural and health sectors, on the one hand, and the ongoing formulation of the MTEF for the post-primary education sub-sector, on the other hand; and (iv) that the 2005 public expenditure reviews in the health and education sectors had been carried out. PROGRAMME IMPLEMENTATION 4. The Loan Agreement was signed on 21 October 2005. It entered into force on 30 December 2005 following fulfilment of four (4) specific conditions, in addition to the general conditions applicable to Bank loans and grants. The loan was converted into a grant in August 2006 following Niger’s reclassification under exclusively grant-eligible countries. The initial amount of the 1st tranche had been set at UA 4.71 million but because of the drought-related crisis the country faced in 2005, and in order to support the food aid programme prepared by the Government, the Bank agreed to raise the amount of the 1st tranche from UA 4.71 million to UA 8.49 million. Thus, this latter amount was disbursed in January 2006. The disbursement of the second tranche of UA 9.51 million was delayed for failure to fulfil one of the four conditions precedent, i.e. “adoption of a national programme in support of decentralization, community and local development, based on the diagnostic study on decentralization”. At the request of the Government, the Bank agreed to reformulate this condition as follows: “Submission to the Fund of a schedule for the adoption of the National Decentralization Programme”. At the time of the reformulation, the ADF decided to preserve not only the spirit of the initial condition, but also the remaining phases to be covered by the Government of Niger towards the adoption of the National Decentralization Programme. The Grant Agreement was modified accordingly, and disbursement was made in September 2007, with the resulting postponement of the Programme’s completion date to end December 2007. 5. The ADF-financed SAP V comprised in all forty-three (43) measures, most of which drew on the priority actions of the PEMFAR I. Out of all these measures, only thirty-four (34) have been implemented, three have not and six have only been partially implemented. The three measures not implemented are: (i) the decentralization of the expenditure authorization function of the Ministries; (ii) the adoption and implementation of the legal texts relative to the management of State property and WAEMU guidelines; and (iii) the use of category 1 and 2 accounts relative to debt and fixed assets. The reasons for the non-implementation of these three measures will be explained in the body of the text. Thus, the programme’s overall implementation rate was 93%, if account is also taken of the ongoing and partly implemented measures. The implementation status by component and sub-component is given as Annex 1 of the Report. OVERALL PERFORMANCE 6. Although SAP-V’s relevance is in line with the previous SAPs, it is justifiable in so far as the programme consolidates the achievements of the previous reforms especially in relation to public financial management. The performance indicators of the programme’s specific objectives were reached and in some cases faired better than planned. Ninety three per cent (93%) of the measures retained were implemented. These achievements can be illustrated at four (4) levels: (i) the institutional level, with the establishment of new

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institutions (Court of Audit, General Directorate of Public Procurement) and the restructuring of the Ministry of Economy and Finance with the setting up of a General Directorate of Financial Control, a General Treasury and Public Accounts Directorate, and decentralization of the expenditure authorization function through the establishment of decentralized budget offices (centres de sous-ordonnancement); (ii) from the standpoint of programme organization and management, the impact was average: the rapidity of the Programme’s effectiveness was offset by the below-average efficiency of the Economic Management Support Group (EMSG) throughout the implementation phase; and lastly (iii) the technical capacity of some of the country’s professionals was built thanks to technical training sessions organized particularly in the preparation of MTEFs and in IT applications designed for budgetary management; and (iv) the macro-economic performance has been satisfactory overall. PROGAMME IMPACTS 7. The Programme had a fairly significant and multi-dimensional impact: (i) socially, improved budgetary resource allocation has helped improve the population’s access to basic social services especially education and health; (ii) in terms of gender, the Programme helped to promote girls’ health and education. The enrolment of girls has been steadily rising countrywide with a gross primary school rate that rose from 45.% in 2003/2004 to 57% in 2006/2007 and a gross enrolment rate (GER) rising from 40.4% in 2003/2004 to 47.4% in 2006/2007; (iii) with regard to the environment, environmental protection concerns were taken into account during the preparation of the sector strategies and MTEFs of the rural and mining sectors; (iv) in terms of regional integration, the results of SAP-V’s implementation will have made it possible to consolidate Niger’s position; indeed the country is one of the few countries to have met almost all WAEMU’s convergence criteria for regional economic integration SUSTAINABILITY 8. Sustainability of the Programme’s impacts will depend on the resolve and determination of the Government to take ownership of and pursue macro-economic and structural reforms in the country. This reform policy has borne fruit since the recently posted economic results have been encouraging despite recent external shocks from the increase in the world prices of energy and food products. Furthermore, the many public finance reforms implemented at the level of the financial authorities (General Directorate of Taxes, the Directorate of Customs and Treasury), and the decentralization process will have a sustainable impact on the management of public resources. CONCLUSION AND LESSONS LEARNT 9 Despite its limited institutional capacity, the Government of Niger has made considerable progress in the implementation of SAP-V. The performance indicators of improved public finance management have, for the most part, been attained. Similarly, the reform measures have most probably had a positive impact as illustrated by the improvement in the way public spending is channeled towards meeting the social needs of the most vulnerable segments of the population. However, the slow mobilization of financial, institutional and organizational resources for decentralization and the external control organs have produced mixed results. This could also cast doubt on the achievement of SAP-V’s specific objective of good governance. But, in order to consolidate the public finance reform

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achievements, it would be desirable for the Authorities to pursue their efforts in collaboration with the development partners, to strengthen the decentralization process and increase the human and material resources of the control organs with a view to consolidating the foundations for good governance. 10 Moreover, although the Programme has been judged satisfactory overall, there are lessons to be learnt with a view to improving the design and implementation of future reform programmes: (i) the success of this Programme and the fact that 93% of the major reform measures were implemented according to schedule, was due to the Government’s commitment as well as the right-sizing of the programme; (ii) the Bank’s approach to the Programme’s design which catered for only a limited number of components and measures, is an approach to promote because it takes into account the country’s limited institutional capacity; (iii) it is important to maintain dialogue with the Government on the need to boost the human and material resources for the internal and external control organs to enable them to properly play their role of establishing good governance practices at all levels; (iv) regular Bank monitoring of the Programme is crucial for the smooth implementation of the reform programmes;(v) the next Bank reform support operation in Niger, should focus on strengthening the control organs; (vi) it is important to scrupulously comply with the project cycle and especially to distinguish between the preparation and appraisal phases so as to carry out decisive, in-depth analyses before designing reform programmes; (vi) it is important to refrain from disbursement conditions based on measures that demand the intervention of the lawmaker to modify laws, texts or political decisions, at least for the first disbursement, since it could take time before these laws are modified and promulgated; (vii) it is vital to avoid measures dependent on related activities that are properly mastered; (viii) it is important to avoid measures that are demanding in terms of institutional organization and are difficult to implement because they require efforts from different often uncoordinated administrations. RECOMMENDATIONS A. It is recommended that the Bank should:

(i) Remind the Government of its obligation, in compliance with the provisions of the General Conditions applicable to Loan Agreements and Grant Agreements, to prepare the completion report, as well as the audits of the special account at the BCEAO and to send the corresponding reports to the Bank; (§ 5.3.1 and § 3.5.2)

(ii) Subject the preparation of a new reform support operation to

submission of the completion and audit reports to the Bank (§ 3.5.1 and 3.5.2)

(iii) Direct the next reform support operation towards strengthening the

control organs and policies aimed at mobilizing greater domestic resources to cushion the impact of a probable decline in assistance from development partners over the next few years (§ 9.2.(v)).

(iv) Strictly comply with the project cycles and distinguish between

preparation and appraisal, and conduct in-depth analyses (§ 7.1.3 and 9.2 (vi)); and

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(v) Design and formulate a limited number of specific, concrete measures and concrete measures that can be implemented over a fairly short period, and are not dependent on uncontrollable factors such as modification of the law, a political decision or even major institutional changes, etc. (§ 9.2 (ix)).

B. It is recommended that the Government should:

(i) Conduct audits of the special account at the BCEAO and submit the corresponding reports to the Bank (§ 3.5.2);

(ii) Complete implementation of the outstanding SAP-V measures (§

3.4.1) ;

(iii) Resolutely pursue the reform policy aimed at strengthening the control organs and towards those policies designed to mobilize more domestic resources to cushion the probable decline in assistance from development partners over the next few years (§ 9.2(v)).

I. INTRODUCTION 1.1 In 2002, the Government of Niger took the resolute decision to direct the reform policy on which it had embarked over ten years earlier, towards reducing poverty, the prevalence of which was estimated at 63% of the population in 1994. Against that backdrop, and in the wake of several structural adjustment programmes, more or less successfully implemented, a fifth phase of these Structural Adjustment Programmes (SAP V) was designed following the adoption, in January 2002, of the Poverty Reduction Strategy. The key strategic thrusts of the latter were: (i) consolidation of a macro-economic framework that would ensure economic and financial stability while fostering sustainable economic growth; (ii) development of the productive sectors aimed at reducing the vulnerability of the economy and stimulating income generation; (iii) improving access of the poor to quality social services especially education, health care, water and sanitation; and (iv) institution building, promotion of good governance and decentralization of development. Similarly, SAP-V’s design was also based on the strategic orientations defined in the 2005-2009 CSP which, among others, advocates support to decentralization, and addressing the weaknesses identified in the context of the 2004 PEMFAR assessment on Niger’s performance in public finance management. These weaknesses concerned in particular: (i) the Government’s financial policy and its capacity to mobilize domestic resources; (ii) fair use of public resources; (iii) the quality of budgetary and financial management; and (iv) corruption control. 1.2 To implement this Programme, the Government sought technical support from development partners including the African Development Bank.5 The latter replied favourably to the request from Niger’s Authorities by fielding a mission to Niger from 12 to 15 March 2005 for the appraisal of SAP V, a balance of payments support project. The overall objective of this new programme was to contribute to the attainment of sustainable economic growth with a view to reducing poverty and promoting Niger’s long-term development. The specific objectives of the Programme’s two components were: (i) improvement of public finance management; and (ii) promotion of good governance, decentralization and strengthening monitoring-evaluation of programmes and the PRS. The reform measures to be taken within the framework of SAP-V’s implementation were defined on the basis of the two above-mentioned components. 1.3 This report gives an account of SAP-V’s implementation and in particular the implementation of the reform measures using data collected in Tunis, at the Bank’s Temporary Relocation Agency, and during the mission to Niamey from 18 to 29 November 2008. The report also makes it possible to draw lessons from the Programme and to make recommendations with a view to designing and implementing other reform programmes. After an introduction which makes up Chapter 1, the report comprises eight other chapters. The second gives the Programme’s objectives and formulation, the third deals with the actual implementation of the Programme, the fourth gives an account of the Programme’s performance and outcomes, the fifth focuses on the Programme’s impacts, the sixth on its sustainability, the seventh recalls the performance of the Bank, the Borrower and the Co-financiers, the eighth summarizes the overall performance and rating and lastly the ninth presents the conclusions, lessons learnt and makes recommendations both to the Government and the Bank.

5 The expressions “the Bank” or “the ADB” are used later in the document to refer to the African Development Bank.

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II. PROGRAMME OBJECTIVES AND FORMULATION 2.1 Programme Objectives and Description 2.1.1 SAP-V’s strategic framework is the Poverty Reduction Strategy that was adopted in 2002 and whose orientations have already been recalled in § 1.1 above. Based on these orientations, the programme’s overall objective was to contribute to attaining sustainable and lasting economic growth with a view to reducing poverty. The reform measures and the relating performance indicators were defined on the basis of the programme’s two components, i.e.: (i) improvement of public finance management; and (ii) promoting good governance as well as strengthening monitoring-evaluation of the Poverty Reduction Strategy and the Programme. The 1st component aims at intensifying domestic resource mobilization and improving the efficacy and efficiency of public expenditure and enhancing the public expenditure programmes aimed at poverty reduction. The 2nd component aims at promoting good governance, strengthening the decentralization and improving monitoring-evaluation of the programmes and the PRS. 2.2 Programme Origin and Formulation 2.2.1 SAP-V is a follow-up to SAP IV which had received Bank support and whose objectives were: (i) the reorganization of public finance in an environment of good governance and building the management capacity of the public administrations; (ii) increasing the cover and quality of basic social services; and (iii) the resumption and deepening of structural reforms in order revive and diversify the economy. At the end of SAP IV’s implementation, it seemed not only that some structural measures such as the privatization of state-owned enterprises and the financial sector reform had been delayed, but more generally, that the large number of measures to be taken exceeded the country’s institutional capacity. 2.2.2 On the other hand, despite past adjustment efforts through successive reform programmes such as SAP I, II, III and IV, there were still persistent problems arising from the mobilization of resources, the inefficacy and inefficiency of public spending, the insignificant resources allocated to poverty reduction and the slowness of the decentralization process. Consequently, the design and formulation of SAP-V not only take those observations into account in order to match the Programme’s size to the country’s institutional capacity, but also the latest reform thrusts as set out in the PRS and the 2005-2009 CSP, (Cf. § 1.1 above), as well as the Priority Action Plan for the implementation of PEMFAR I recommendations. 2.3 Preparation, Appraisal, Negotiation and Approval 2.3.1 Programme identification and appraisal were combined during the mission to Niamey from 12 to 25 March 2005. The mission was conducted by an expert from the Bank assisted by a consulting macro-economist. The loan agreement negotiations took place at the Temporary Relocation Agency in September 2005. The negotiations focused on a review of the Appraisal Report and more specifically, on the modalities for goods and services procurement, disbursements and the conditions precedent to effectiveness of the ADF loan. The loan of eighteen million units of account (UA 18 million) was approved by the Board on 21 September 2005.

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III. PROGRAMME IMPLEMENTATION 3.1 Grant Effectiveness 3.1.1 The loan agreement was signed on 21 October 2005 and the loan entered into force on 30 December 2005 following fulfilment of the four (4) specific conditions in addition to the general conditions applicable to Bank loans and grants. The conditions consisted in providing ADF with evidence that: (i) a special account had been opened in the Central Bank of West African States (BCEAO–National Directorate of Niger) into which was to be deposited exclusively, the ADF loan resources, in respect of SAP-V; (ii) the Government had adopted a plan to broaden the tax base, especially with regard to the informal sector; (iii) the national core welfare indicators questionnaire (CWIQ) survey had been launched in 2005 ; and (iv) that the decisions relative to consolidating coordination between the various Governmental structures involved in decentralization support on the one hand, and the institutional anchorage of the High Commission for Administrative Reform and Decentralization (HCRAD), on the other, had been taken. The Government of Niger made every effort to ensure the rapid effectiveness of the project in two months 3.2 Disbursements of the Tranches and Modifications 3.2.1 It is important to note that the loan was converted into a grant in August 2006 following Niger’s reclassification under the category of countries eligible exclusively for grants. The initial amount of the 1st tranche had been fixed at UA 4.71 million, but because of the crisis the country experienced in 2005 as a result of the drought, and in order to support the food aid programme prepared by the Government, the Bank agreed to increase the amount of the 1st tranche from UA 4.71 million to UA 8.49 million. It is therefore this latter amount that was disbursed in January 2006. The disbursement of the second tranche was subject to providing the ADF with evidence: (i) in a detailed report of the operationalization of the pilot computer room of the Ministry of Economy and Finance; (ii) of the adoption of a national programme in support of decentralization, community and local development, based on the diagnostic study on decentralization; (iii) of the preparation of the 2006 MTEF for the rural and health sectors, on the one hand, and the ongoing preparation of the MTEF for the post-primary education sub-sector, on the other hand; and (iv) that the 2005 public expenditure reviews in the health and education sectors had been carried out. 3.2.2 Three of the four above-mentioned conditions precedent to disbursement of the second tranche were fulfilled. The only one not fulfilled concerned adoption by the Government of the National Decentralization Support Programme (condition ii). However, given the significant progress in the Reform Programme’s implementation and fulfilment of most of the conditions for the disbursement of the second tranche of the loan converted into a grant, a request for the reformulation of this condition was submitted to the Board of Directors on 17 July 2007, so as to accelerate release of the second tranche. This condition was reformulated as follows: “Submission to the Fund of a schedule for the adoption of the National Decentralization Programme”. At the time of the reformulation, the ADF decided to maintain not only the spirit of the initial condition but also to take into account the remaining stages to be completed by the Government of Niger towards the adoption of the National Decentralization Programme. The Bank’s Board of Directors gave its no-objection to the proposed reformulation in late July 2007 following which the Bank amended the Grant

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Agreement and, in September 2007, disbursed the second tranche of UA 9.51 million. The Programme’s completion date was thus postponed to 31 December 2007 3.3 Implementation Schedule The difference between the estimated and actual schedules indicate average efficiency of project management, at least with regard to keeping schedules. In fact, although the Government of Niger ensured the programme’s effectiveness very rapidly, only two months after its signature, its actual implementation fell six months behind schedule. Indirectly, this meant that programme completion also fell behind by six (6) months. Furthermore, it is important to note that the measures not yet, or being implemented were unrealistic in so far as they implied actions from the law-maker, or the political authorities or else, major institutional changes. 3.4 Matrix of Programme Measures 3.4.1 The ADF-financed SAP-V was based on a matrix of forty three (43) measures. Most of these were taken from the Priority Action Plan resulting from PEMFAR’s recommendations. On the whole, of all these measures, thirty four (34) were implemented and three (3) were not implemented at all. These were: (i) decentralization of the expenditure authorization function of the Ministries; (ii) adoption and application of the legal texts relative to the management of State property and to the WAEMU guidelines; and (iii) utilization of category 1 and 2 accounts relating to debt and fixed assets. The reasons these three measures were not implemented will be explained below. On the other hand, the following six were only partially implemented: (i) the establishment of the overall MTEF in the context of the central government budget preparation; (ii) better management of delegated credits by reducing the timeframes for credit settlement by expanding the computerized financial management system to the decentralized budget offices and secondary accountants; (iii) collection and timely dispatch of comprehensive data on expenses from external financing; (iv) reorganization of the Treasury in accordance with the Organic Law on Budget Laws, and separate the normative from the accounting functions; (v) gradual reduction of the suspense accounts for budgetary operations to be settled; (vi) finalization of the reconciliation of the personnel management files of the Ministry of the Civil Service with the wage bill. Lastly, the following three (3) measures are being implemented: (i) finalize the functions of the integrated financial management system taking especially into account the validation phase and gradually extend the system to the financial authorities and other MEF services; (ii) build the capacity of the Auditor General’s Office by training, recruiting magistrates and auditors, strengthening the method of work (procedures manual, audit guide) and material resources (equipment); (iii) conduct studies to supplement the legal and regulatory mechanism for the decentralization process. This means that the Programme’s overall implementation rate is 93%, if account is also taken of the ongoing and partly implemented measures. The implementation status by component and sub-component is given as Annex 2 of this report and can be summarized as follows: Component I: Improvement of Public Finance Management 3.4.2 The Performance Indicators were defined for this first component at the following three levels: (a) resource mobilization, (b) enhanced efficacy and efficiency of public spending; and lastly (c) improvement of poverty reduction expenditure. Concerning resource mobilization, the administrative measures taken at the DGI especially to simplify the

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registration procedures for establishments involved in the informal sector, to decrease registration fees and lower tax rates, and those taken by the DGD concerning the renewal of managers helped to achieve a tax revenue/GDP ratio of 12.12% in 2007. Concerning the enhanced efficacy and efficiency of public spending, all the performance criteria were met especially for: (i) improving budget preparation; (ii) establishing the MTEFs of the Education and Health sectors; (iii) strengthening the budget regulatory mechanisms and cash flow plans with the participation of the Technical Ministries; (iv) establishing and implementing the domestic arrears clearance plan as well as the adoption of an efficient external debt management software. Lastly, most of the criteria for improving poverty reduction expenditure were fulfilled. Indeed, in the area of education, all the provisions made under the teacher recruitment and training policy, as well as for the use of the school map to better plan education facility development, led to a gross primary enrolment ratio of 57.1% which was expected to rise to 62.3% in 2008. The same applies to the health sector, where for similar provisions made in accordance with the Health Development Programme (PDS), the performance indicators achieved in 2007 were rather close to, if not higher than those set at SAP-V’s appraisal, particularly 78.17% for the DTCP3 immunization rate compared to an estimated 59%. 3.4.3 The Reform Measures retained for this first Programme component were for the most part carried out. However, it is clear that some very important measures are yet to be implemented. These include in particular: (i) the process to decentralize the function of expenditure authorization to some central ministries in the form of a pilot experience; (ii) the adoption and implementation of the legal texts relative to the management of State property and the WAEMU guidelines; and (iii) the use of category 1 and 2 accounts relative to the debt and assets. Because the sector MTEFs have not been generalized, the current overall MTEF is based on the existing sector MTEFs and on a broad estimate for the remaining sectors on the basis of the macro-economic framework. The econometric model used for the macro-economic framework is besides being revised to better reflect the reality. The start of the process to decentralize the expenditure authorization function to some technical Ministries, even if experimental, requires first of all, the amendment of certain texts, especially the public finance organic law. As to the adoption and implementation of the legal texts relative to the management of State property and the WAEMU guidelines, nothing has been done yet pending the conclusions of the studies on physical accounting. Lastly, concerning the use of category 1 and 2 accounts relating to debt and fixed assets, contrary to what can be seen in other countries, debt management is not the responsibility of the Treasury. Details concerning ongoing or partially implemented measures are given as Annex 2. Component II: Promoting Good Governance and Strengthening Monitoring-Evaluation of Programmes and the Poverty Reduction Strategy (PRS) 3.4.4 The Performance Indicators Selected. The following three are in progress: (i) establishment of a Decentralization Observatory; (ii) establishment of a National Decentralization Programme; and (iii) adoption of the texts designed to make decentralization operational (skills transfer, mechanisms for operating the Decentralization Support Fund and the Stabilization Fund). For the latter, plans have been made for a Central Bank for the local authorities, since the law and enabling decrees have been approved.

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3.4.5 The Measures Retained under this second component have, for the most part, been taken. The following two in particular can be mentioned: reviews of public spending in the Ministry of Economy and Finance and in the priority sectors, and secondly, strengthening the role of the financial controllers with the setting up of the Financial Control Department initially within the General Budget Directorate converted into an Independent General Directorate attached directly to the Office of the Minister of Economy and Finance. The following two measures are ongoing: (i) building the capacity of the Audit Office in terms of training, recruitment of magistrates and auditors, work methodology (procedures manual audit guide) and material resources (equipment). In fact, a manual on audit guidelines and techniques was compiled by a Firm with UNDP support. However, the Audit Office is not yet operational because it is yet to be assigned its new functions. It is also not operational because it lacks human and technical resources. The capacity building programme which should be financed by the TFPs could improve the situation, once all staff of the Audit Office have been recruited. (ii) the conduct of studies to supplement the legal and regulatory mechanism for decentralization. Lastly, the measure designed to gradually phase out suspense accounts for budgetary operations has been partially implemented, given that budget execution by way of exceptional procedures is still used. 3.5 Reporting 3.5.1 Reports on the Programme’s Implementation Status: During the Programme’s implementation, the Bank received four (4) quarterly status reports from the Government which although irregular were of good quality. On the other hand, the Programme Completion Report that the Government was to prepare has still not been sent to the Bank despite numerous reminders by the Bank during the supervision missions to the country. 3.5.2 Audit Reports: According to reports made by the Bank’s supervision missions, the Internal Control Departments of the BCEAO’s National Directorate (Central Bank) regularly audited the special account into which the ADF grant resources were deposited. Supporting documents for the use of the first and second tranches were submitted to the Bank missions for control. These documents were deemed to be in conformity with the relevant Bank requirements. On the other hand, the audit of the first tranche which was to have been carried out no later than 3 months after disbursement is still pending. Therefore, the attention of the authorities of Niger is being drawn to the need for this audit at the same time as the audit that was to be carried out for the second tranche. To date, the Bank has not received any audit report. Consequently, submission of the audit reports on the use of both grant tranches was to be a prerequisite for the preparation of the next budgetary support programme for the country. 3.6 Procurement of Goods and Services 3.6.1 The ADF grant was used to finance imports of eligible goods and services for the private and public commercial sectors of Niger’s economy (cf. Annex 9). An analysis of the justification for the use of the two grant tranches revealed that:

(i) the goods imported came in fact from Bank member countries and ADF participating countries;

(ii) imports were mainly food products, oil products and other eligible goods;

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(iii) there was no bill for goods from the non-eligible goods list;

(iv) the imported products concern the private sector and commercial-type public enterprises; and

(v) the imported products were procured in compliance with commercial practices

in force in Niger and in line with ADF rules and procedures. 3.6.2 The audit reports that will be sent later to the Bank, will provide more detailed information on the methods of procuring the goods and services used. 3.7 Financing Sources and Disbursement of the Grant Tranches 3.7.1 The ADF is one of the sources financing the Niger Government’s reform programme. The estimated financing requirement stood at UA 105.73 million broken down as follows for the 2006-2007 period:

IDA World Bank 26.60 IMF 6.58 European Union 29.20 France 10.30 Belgium 6.98 Netherlands/Norway 2.74 French Development Agency (AFD) 5.03 Denmark 0.30 ADF 18.00 3.7.2 The ADF grant was disbursed in two tranches of UA 8.49 million in January 2006 and UA 9.51 million in September 2007. The total amount of the disbursement of the contributions from other development partners is difficult to evaluate given that the information is not available especially for the bilateral partners like Denmark, Netherlands and Norway. Conversely, multilateral partners like the ADF and IMF released the projected amounts of UA 6.2 and UA 18 million respectively (cf. programme basic data, p. v). The World Bank on the other hand disbursed more than planned, no doubt a supplementary contribution in respect of food security. IV. PROGRAMME PERFORMANCE AND OUTCOMES The Programme’s performance can be illustrated from three levels (i) institutional, with the setting up of new institutions (Audit Office, General Directorate of Public Procurement) and the restructuring of the Ministry of Economy and Finance with the establishment of a General Financial Control Directorate, a General Directorate of Treasury and Public Accounts; (ii) from the standpoint of organization and management of the programme the impact is mixed; the rapidity with which the Programme entered into force is diluted by the inefficiency of the Economic Management Support Group (EMSG) throughout the implementation phase; and lastly (iii) in terms of technical capacity building of some of Niger’s professional staff thanks to the technical training they were given especially in the preparation of MTEFs and in the budget management software.

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4.1 Institutional Performance 4.1.1 Major institutional reforms were made under SAP-V. These included the restructuring of the Ministry of Economy and Finance with innovations highlighted by the upgrading of the Financial Control Directorate into an Independent General Directorate attached to the Office of the Minister, the establishment of the General Directorate of Public Procurement also attached to the Office of the Ministry, the transformation of the National Treasury into a General Directorate of Treasury and Public Accounts, the conversion of the Court of Audit into an Audit Office independent from the Supreme Court the purpose being to strengthen its authority of judicial control of the State’s accounts. 4.1.2 From an operational standpoint and in order to ensure a more efficient implementation of the Poverty Reduction Strategy, each of the Ministries was invited to prepare sector strategies based on the general orientations of the PRSP. Thus, several sector policies and programmes were adopted and implemented. These include the Ten-Year Education Development Programme, the 2005-2010 Health Development Programme, the Rural Development Strategy, the National Infrastructure Development Plan, the Water and Sanitation Policy and Strategy, the National Strategic Framework for AIDS Control, etc. 4.1.3 Another programme institutional performance was the streamlining of the budgetary process which has meant greater involvement of the Technical Ministries in public spending choices in their respective sectors. Therefore, preparation of the sector MTEFs and programme budgets, particularly in the social sectors that are instrumental in reducing poverty, aims at encouraging the Ministries concerned to optimize their expenditure proposals based on a strategic vision of their priorities. The State budget will be, more than ever before, a genuine and increasingly efficient tool for the Government’s economic policy as it seeks to reduce poverty. 4.1.4 The Programme’s performance concerning economic governance is illustrated by: (i) the start of a decentralization process that seeks to promote development at grassroots level by making the communities accountable in the choice of their development priorities, which will increasingly take into account the basic needs of the most vulnerable segments of the population; (ii) the decentralization of the expenditure authorization acquired for delegated credit confers on the regional and departmental authorities (decentralized budget offices) greater management autonomy necessary for the smooth implementation of local development programmes; (iii) the implementation of the laws voted by Parliament on Decentralization in 2002, has enabled the creation of 265 communes comprising 52 urban communes and 213 rural communes. These new entities now present in the new institutional landscape are now frameworks for the implementation and management of government policies in the key area of poverty reduction; and (iv) the establishment of a High Commission for State Modernization and Decentralization. All these institutions contribute to greater efficiency of the public services to better meet the needs of the population. 4.2 Management and Organizational Performance 4.2.1 The institutional arrangements for programme implementation as set out in the Appraisal Report were applied. Indeed, the Economic Management Support Group (EMSG) which was to provide technical assistance to the High Commission in the Programme’s steering was put in place. The Executing Agency was inefficient in the conduct of its duties, in that the four quarterly reports, although of good quality, were not sent regularly as planned

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in the implementation schedule. In addition, about 28% of the measures were not implemented (including those partly implemented or ongoing). The Programme Completion Report is yet to be prepared by the Government and sent to the Bank. The same applies to the reports of the audit of the special account at the BCEAO which should have been prepared following the disbursement of both tranches of the ADF grant. All these tasks should have been carried out by the EMSG before the end of its activities in 2007. From that standpoint, therefore, performance was unsatisfactory. 4.2.2 However, the fact that 93% of the programme’s measures were implemented is testimony to the rapidity which Niger’s government services implemented the programme. This rapidity also explains the relatively short lapse of time between the Grant signature and effectiveness dates. Nonetheless, fulfilment of some precedent conditions could have been difficult as they were of an institutional nature (political and administrative oversight of the High Commission of Administrative Reform and Decentralization). 4.3 Capacity Building and Retraining Training of Professional Staff 4.3.1 With a view to preparing the sector MTEFs and programme budgets under the Programme, training courses were organized for professional staff of some Technical Ministries with a view to expanding the SMTEFs to sectors other than education and health. Moreover, in order to improve expenditure programmes in relation to external debt monitoring, a new version of the debt management software is currently being used to take into account the HIPCI and the MDRI. For better budgetary planning, the expenditure chain is being computerized so as to considerably reduce the risks of misappropriation of funds. In addition, the fiduciary framework was strengthened particularly by increasing the human and material resources of the Control Institutions (General Finance Inspectorate, Audit Office and establishment of the General Financial Control Directorate). However, it is important to note that although noteworthy efforts have been made towards capacity building, the capacity of the administration in Niger is still limited and thus is a major obstacle to improving public expenditure management. 4.4 Economic Performance 4.4.1 The performance criteria of the Programme’s overall objectives consisted in: (i) achieving an economic growth rate of 4.3% in 2007, while raising the investment rate to 15% of GDP; (ii) containing inflation at around 3% throughout the Programme’s duration; (iii) increasing budget revenue to 12.15% of the GDP and containing current expenditure (excluding debt interest) at 10% of GDP, domestic savings at around 11.1% of GDP in 2007 compared to 9.9% in 2004, and narrowing the current account deficit from –7.3% in 2004 to -7.2% in 2005, -6.9 in 2006 and –6.3% of the GDP in 2007. 4.4.2 At the end of the Programme’s implementation in 2007, the macro-economic outcomes turned out to be satisfactory overall, even if the growth rate was only 3.2% compared to an estimated 4.3%, as a result of poor harvests after two consecutive plentiful years. The investment rate on the other hand, was 21.7% of GDP 15.4% of which was for the private sector alone compared to a national target of 15% of GDP. This private investment rate could have been higher if the cost of doing business had decreased enabling Niger which is ranked 169, to take a position above the WAEMU country average of 160 out of 178 countries. The rise in the world prices of food and energy products increased the inflation rate to 4.7% although it should have been contained at 3% in compliance with the WAEMU

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convergence criteria. Faced with an increase in public spending representing 22.3% compared to 20.1% and 20.4% respectively in 2006 and 2005, budgetary revenue was estimated at 15.5% of the GDP compared to 10.8% and 13.2% respectively, in 2005 and 2006. Lastly, the current account deficit of the balance of payments (excluding official transfers) represented for -10% of GDP compared to the estimated -6.3%. V. PROGRAMME IMPACTS 5.1 Social Impact 5.1.1 The existence and operationalization of the MTEFs in the education and health sectors have improved the policy of allocating budgetary resources to these sectors, thereby improving coverage of social needs in the country’s regions and departments. A study that dates back to 2006 on the level of satisfaction with education services of the beneficiaries and actors revealed that 57.1% of education authorities approved an increase in infrastructure since the implementation of the Ten-Year Education Development Plan, which resulted in an increase in the primary school enrolment rate to 62.1% in 2008 compared to 43% in 2004. However, there is still a certain mismatch, due to a lack of resources, between education demand and supply on the one hand, and the unsatisfactory standard of education on the other, since 94.6% of the parents are of the opinion that supply of education services does not meet the demand for a system that will facilitate the professional integration of children. In the area of health, doubling the credits (CFAF 4.9 billion in 2007 compared to 1.9 billion in 2006) allocated to the purchase of drugs and vaccinations, and the introduction of incentives for health staff to encourage them to serve in areas other than the capital, led, inter alia, to a decline in certain endemic diseases and a significant improvement in the health indicators. For example, the immunization coverage rate for DTCP3 was 75% in 2007 although the Programme had only estimated 59%, 93% for the BCG and 87% for the VAR). 5.1.2 The HIPC funds made it possible, within the framework of the Special Programme, to speed up construction of infrastructure for Education, Health and Rural Development, the support sectors for the poverty reduction policy, in compliance with the overall SAP-V objective. However, the prevalence of poverty (over 60% of the population) is still a cause for concern, given that the Government’s efforts to reduce it could be undermined by the rise in world prices of food and energy products that have dented household purchasing power. However, following the CWIQ survey, 70% of the population are of the view that the policies implemented by the Government to reduce poverty have had some positive results. The improved social indicators over time reflect this (cf. § 5.1.1 and § 5.2.1). 5.2 Impacts on Gender 5.2.1 It is difficult to determine the Programme’s direct impact on gender parity and on equal access to economic resources; nonetheless, the Programme’s impact on gender is assessed in the report through the indirect effects on girls’ education and health. The 2007 implementation review of the Health Development Programme (PDS 2005-2010) highlights the importance of the activities carried out under the Reproductive Health Programme which concerns mainly women; given that these activities accounted for 20.25% of all the activities scheduled under the PDS. In that regard, the following results of the activities in question should be noted (i) the antenatal consultation rate (ACR) reached 70% thus exceeding the 50% target set for 2007; (ii) the post-natal consultation rate doubled; (iii) the contraceptive prevalence rate rose from 5% in 2006 to 8% in 2007 although it is still below the set objective

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of 10%; (iv) the rate of delivery assisted by qualified staff rose from 14% in 2006 to 19% in 2007, not far from the 20% target; (v) the percentage of pregnant women who received anti-malaria treatment rose considerably, up from 19% to 53%, above the 45% target; (vi) the caesarean section rate rose from 0.47% in 2006 to 0.98% in 2007; lastly, the percentage of under-nourished children under five years of age receiving care rose sharply. As can be seen, mother and child health care improved greatly during SAP-V’s implementation. In the area of Education, the attendance rate of girls has been steadily rising countrywide: their gross primary school access rate (PAR) rose from 45.9% in 2003/2004 to 57% in 2006/2007 and their gross enrolment rate (GER) rose from 40.4% in 2003/2004 to 47.4% in 2006/2007. 5.3 Environmental Impacts 5.3.1 The Programme does not contain any specific environmental protection measure. It should simply be remembered that in the sector strategies of the rural and mining sectors and in the preparation of the MTEFs of those sectors, environmental protection concerns will be taken into account. 5.4 Impacts on Regional Integration 5.4.1 Niger is a member of several sub-regional economic organizations including the West African Economic and Monetary Union (WAEMU) and the Economic Community of West African States (ECOWAS). As a member of these organizations Niger must meet the commitments for the harmonization and coordination of economic and financial policy which requires compliance with the Convergence Criteria set out by the Authorities of these organizations. Thus, the results recorded for SAP-V’s implementation will have made it possible to consolidate Niger’s position in regional economic integration. 5.4.2 Indeed, within the framework of WAEMU, five (5) of the eight (8) criteria6, have been met, and those not met were: basic balance/GDP higher or equal to 0%, the current account (excluding grants)/GDP higher or equal to -5% and the tax revenue/GDP higher or equal to 17%. ECOWAS for its part, has defined two types of criteria: the first-tier and the second-tier. Out of the four (4) criteria of the primary category7 only the following two have been met: financing of the budget deficit by the Central Bank lower or equal to 10% of the previous year’s fiscal revenue and an inflation rate lower than 5%. For the six (6)8 criteria under the secondary category, and which correspond more or less to the WAEMU criteria, only the tax revenue/GDP ratio was not met. Besides, no ECOWAS member state has to date succeeded in meeting all the convergence criteria at the same time. From that standpoint, Niger’s performance can be judged satisfactory.

6 The ratio of the basic net fiscal position to nominal GDP should be equal to or higher than 0%. The average annual rate

of inflation should not exceed 3%. The ratio of domestic and external debt to nominal GDP should not exceed 70 %., no accumulation of arrears, the wage bill less than or equal to 35% of tax receipts, ratio of domestically-financed investment to tax receipts higher than 20%, current account (excluding grants)/GDP higher than -5% and fiscal revenue/GDP higher or equal to 17%.

7 These are: the budget deficit excluding grants on a commitment basis/nominal GDP, inflation rate, financing of the budget deficit by the Central Bank and gross exchange reserves

8 These are: no new arrears, fiscal revenue/GDP lower or equal to 20%, ratio wage bill/tax receipts lower or equal to 35%, ratio of domestically-financed investment to tax receipts higher than 20%, stability of the real exchange rate and positive real exchange rate.

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5.5 Assessment of Programme Risks 5.5.1 At appraisal, the following three main risks were identified: (i) repeated droughts that impacts on the country’s economic growth rate; (ii); weak institutional capacity; (iii) the Government’s inability to maintain the stability of the macro-economic framework and the institutions of the Republic in a climate of sub-regional instability and social tension. Therefore, measures to mitigate these risks were also outlined. 5.5.2 Repeated Drought: Niger’s economy is all the more vulnerable to drought as its agriculture is of the rain-fed type and the climate features a long dry season of 8 to 10 months and only 2 to 4 months of rains. It is therefore a structural constraint on the development of agriculture which accounts for about 46% of GDP. To address this constraint, the Government undertook, with the participation of farmer organizations and donor support, to initiate and encourage farming of irrigable land of a potential of about 270 000 ha including 140 000 ha concentrated in the valley of the River Niger. Irrigated schemes have become widespread over the last two decades and, although the irrigation sub-sector represents only a tiny part of the farmed areas, it is still an important part in terms of monetary value and export revenue from plant production. As such, today, the share of irrigated crops (mainly rice and off-season crops) is estimated at 14% of the total value of agricultural GDP and export earnings from irrigated productions are estimated at about 13 million US dollars. 5.5.3 Weak Institutional Capacity: the numerous institutional support operations financed by technical and financial partners including the Bank (Institutional Support in the context of SAP IV) have made it possible to partially overcome this weakness. Furthermore, when projects and programmes are designed to take into account the existing institutional capacity as in the case of SAP-V, the implementation results are generally positive and encouraging. 5.5.4 ’The Government’s Inability to Maintain the Stability of the Macro-economic Framework and Social Unrest: The Government’s achievements not only with SAP-V but also with the IMF-backed PRGF whose 6th review was conclusive, illustrate well the Government’s proven capacity to maintain the stability of the macro-economic framework. As to the social unrest which breaks out occasionally, in the country’s north, twice declared military area in February 2007 and August 2008, it had no negative impact on the Programme’s implementation. All it did was slow down tourist activities in the region. VI. SUSTAINABILITY OF PROGRAMME IMPACTS 6.1 Most of the measures taken under the 1st component were designed to sustainably improve public finance management. The restructuring of the Ministry of Economy and Finance which took place during the Programme’s implementation with the setting up of the General Directorate Public Procurement, and the conversion of the Financial Control Directorate into an Independent General Directorate attached to the Office of the Minister, should enhance the efficacy of the services of these Units. Moreover, the decentralization process launched during the Programme seems irreversible since the trend currently in most countries is to promote grassroots development by, and for the populations themselves.

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VII. PERFORMANCE OF THE BANK, DONEE AND CO-FINANCIERS 7.1 Performance of the Bank 7.1.1 The Bank’s performance will be determined on three levels: programme design, preparation and appraisal, as well as implementation monitoring. The rating (2.8) is highly satisfactory (cf. Annex 4). 7.1.2 Design, the limited number of measures (43) selected for implementation in a timeframe of 18 months and likewise the limited number of components seem quite reasonable given the country’s limited institutional capacity and especially the lessons learnt from previous reform operations (SAP I to IV). 7.1.3 For Preparation and Appraisal: the Bank did not prepare the Programme but instead appraised it directly during the mission to Niamey 12 to 25 March 2005, and which comprised two persons: the Country Economist and a Consultant. The matrix of measures that was appended to the report did not make a clear distinction between those under each of the two components. In addition, it offers a rather confusing hierarchy of objectives. Moreover, the outcomes expected of each measure were not stated although the areas covered by the Programme were relevant and were a good response to the orientations of the poverty reduction development strategy as the pillars of the Bank’s CSP. One lesson learnt is the need to strictly comply with the different stages of the project cycle and in particular to distinguish between the preparation and appraisal phases with a view to conducting decisive in-depth analyses of the reform programmes. 7.1.4 Concerning Implementation Monitoring, the Bank was effective since not only was a launching mission organized but in addition to two supervision missions, a midterm review mission was also fielded. Each time the supervision reports took stock of implementation progress and also made relevant recommendations for a better application of the Programme. 7.2 Performance of the Donee 7.2.1 The Donee actively participated in the work of the Programme appraisal mission conducted by the Bank in Niamey. It followed the recommendations that were made by the supervision missions and those of the midterm review. On the other hand, while the Programme entered into force without delay, the Programme’s effective start-up fell six months behind schedule. Similarly, contrary to the undertakings that had been given in the context of the General Conditions Applicable to Grants, the Donee did not submit to the Bank reports on the audit of the special account, nor did it send the Programme Completion Report. In addition, about 28% of the measures were not implemented (including those partly implemented or ongoing) during the period of Programme implementation, notwithstanding the flexibility of the implementation deadlines which spanned two years. The above seems to indicate a fairly slow pace of implementation of the measures. Performance is therefore fairly satisfactory and rated 2. (cf. Annex 3) 7.3 Performance of the Co-financiers 7.3.1 Like the disbursement outputs (cf. p. v), the performance of the co-financiers is fairly satisfactory, in that only the multilateral partners (IDA/BM, IMF, ADF) disbursed an amount at least equal to the estimates. This underscores the unpredictability of the Government’s

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revenue and weakens its cash flow. Hence the need for greater coordination regarding the disbursement deadlines. This average performance was also due to difficulties in obtaining the disbursement amounts from some partners. VIII. OVERALL PERFORMANCE AND RATING 8.1 Relevance of Objectives and Justifications 8.1.1 SAP-V’s relevance, although in line with previous SAPs can be justified by the fact that it consolidates the achievements of previous reforms, especially with regard to public finance management. Indeed, the previous SAP I, II, III and IV focused not only on public finance reform designed to enhance domestic resource mobilization but also to reduce the country’s dependence on external aid. Upon completion of this new Programme, the key objectives in terms of better public finance management were reached. The performance indicators against the specific objectives targeted by the Programme were achieved and in some cases were better than planned. Ninety-three per cent (93%) of the measures retained were implemented. However, it is obvious that the results achieved fell short of the Government’s expectations in that area. In fact, the poor resource mobilization (tax/GDP ratio was the lowest in the WAEMU countries), the lack of efficacy and efficiency of public expenditure as well as the lack of resources allocated to poverty reduction compounded the difficulties the Niger Government encountered in effective resource mobilization and use. A 2.6 rating was awarded for the above-mentioned reasons (cf. Annex 5) 8.2 Institutional Development 8.2.1 The Programme contributed to strengthening Niger’s administration through: (i) the restructuring of the Ministry of Economy and Finance, with innovations such as the establishment of the DGCF, DGCMP, DGTCP and the Audit Office; (ii) the implementation of the Poverty Reduction Strategy, the sector strategies based on the orientations of the PRSP, and the preparation of the sector MTEFs and the programme budgets especially in the social sectors which are the key areas for poverty reduction; (iii) the launching of the decentralization process aimed at promoting grassroots development and making the communities more accountable in the selection of development priorities which will increasingly take into account the basic needs of the most vulnerable segments of the population; (iv) the deconcentration of expenditure authorization for delegated credits provides the regional and departmental authorities (decentralized budget offices) greater management autonomy needed for the smooth implementation of local development programmes; and (v) creation of the High Commissioner for State Modernization and Decentralization. All these institutions contribute to enhancing the efficacy of public services so that they can better meet the needs of the population. The rating here was 2.5 (cf. Annex5) 8.3 Sustainability 8.3.1 The sustainability of the Programme’s impacts depends on the Government’s will and determination to take ownership of and pursue the country’s macro-economic and structural reform policy. This reform policy bore fruit because the economic results in recent years have been encouraging despite external shocks marked by the hike in the prices of world energy and food prices. Besides, the numerous reforms introduced in the management of public finance both at the level of the financial authorities (General Tax Directorate, General Customs and Public Treasury Directorate) and at the level of the decentralization process,

15

will have a positive long-term impact on the way public resources are managed. This component was rated 2.6 (see Annex 5) 8.4 Overall Programme Performance 8.4.1 In all, the performance indicators for the Programme’s specific objectives were achieved and, in some cases, surpassed. Ninety three percent (93%) of the planned measures were implemented. However, because of the flexibility of the deadlines which in some cases exceed two years, it is difficult to determine the speed at which these measures were implemented. The restructuring of the Ministry of Economy and Finance during the Programme’s implementation was intended to enhance the efficacy of this Ministry in steering the reform programmes. Furthermore, in recent years, the progress achieved by the financial authorities (Customs and Taxes), in terms of domestic resource mobilization are directed at achieving over time the objective of reducing the country’s dependence on external aid. Indeed, the latter is expected to decline as a result of the global financial crisis and economic recession looming for the developed countries, Niger’s development partners. On the basis of the criteria selected and the related marks (Cf. Annex 5), the Programme’s overall performance rating of 2.5 is deemed satisfactory. IX. CONCLUSION, LESSONS AND RECOMMENDATIONS 9.1 Conclusion 9.1.1 Despite its limited institutional capacity, the Government of Niger has made considerable progress in the implementation of SAP-V. The performance indicators of improved public finance management have, for the most part, been achieved. Similarly, the reform measures implemented have most probably had a positive impact as illustrated by the improvement in the way public spending is channelled towards meeting the social needs of the most vulnerable segments of the population. However, the slow mobilization of financial, institutional and organizational resources for decentralization and the external control organs have produced mixed results. This could also cast doubt on the achievement of the specific objective of good governance. But, in order to consolidate the public finance reform achievements, it would be desirable for the Authorities to pursue their efforts in collaboration with the development partners to strengthen the decentralization process and increase the human and material resources of the control organs with a view to consolidating the foundations for good governance. 9.2 Lessons Learnt from Programme Implementation

The main lessons learnt from the formulation and implementation of SAP-V are the following:

(i) The success of this Programme and the fact that 93% of the major reform measures were implemented according to schedule was due to the Government’s commitment as well as the right-sizing of the Programme;

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(ii) The Bank’s approach to the Programme’s design which catered for only a

limited number of components and measures to implement is an approach to promote because it takes into account the country’s limited institutional capacity;

(iii) With a view to pursuing dialogue with the Government, it is important to

select the theme concerning the strengthening of human and material resources for the internal and external control organs to enable them to play their role of fostering good governance practices at all levels;

(iv) Regular Bank monitoring of the Programme is crucial for the smooth

implementation of the reform programmes;

(v) It would be wise to direct the Bank’s next policy-based reform operation in Niger to strengthening the control organs and towards policies that are designed for greater mobilization of domestic resources so as to cushion the impact of the probable decline of aid from development partners over the next few years (§ 9.2.(v)).

(vi) It is necessary to scrupulously comply with the project cycle and especially to

distinguish between the preparation and appraisal phases so as to carry out decisive, in-depth analyses before designing reform programmes;

(vii) It is important to refrain from disbursement conditions based on measures that

demand the intervention of the lawmaker to modify laws, texts or political decisions, at least for the first disbursement, since it could take time before these laws are modified and promulgated;

(viii) It is important to avoid measures dependent on associated activities that are

not perfectly mastered;

(ix) In the case of Niger, it is important to avoid measures that are demanding in terms of institutional organization and are difficult to implement because they require efforts from different often uncoordinated administrations.

9.3 Recommendations9 A. It is recommended that the Bank should:

(i) Remind the Government of its obligation, in compliance with the provisions of the General Conditions applicable to Loan Agreements and Grant Agreements, to prepare the completion report, as well as the audits of the special account at the BCEAO and to send the corresponding reports to the Bank; (§ 5.3.1 and § 3.5.2)

9 A matrix of recommendations and action follow-up is given as Annex 6 of this report.

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(ii) Subject the preparation of a new reform support operation to submission of the completion report and audit reports to the Bank (§ 3.5.1 and 3.5.2)

(iii) Direct the next reform support operation towards strengthening the

control organs and policies aimed at mobilizing greater domestic resources to cushion the impact of a probable decline in assistance from development partners over the next few years (§ 9.2.(v)).

(iv) Strictly comply with the project cycles and distinguish between

preparation and appraisal, and conduct in-depth analyses (§ 7.1.3 and 9.2 (vi)); and

(v) Design and formulate a limited number of specific, concrete measures

that can be implemented over a fairly short period, and are not dependent on uncontrollable factors such as modification of the law, a political decision or even major institutional changes, etc. (§ 9.2 (ix)).

B .It is recommended that the Government should:

(i) Conduct audits of the special account at the BCEAO and submit the

corresponding reports to the Bank (§ 3.5.2);

(ii) Complete implementation of the outstanding SAP-V measures (§ 3.4.1);

(iii) Resolutely pursue the reform policy aimed at strengthening the control

organs and towards those policies designed to mobilize more domestic resources to cushion the probable decline in assistance from development partners in the coming years (§ 9.2(v))..

Annex 1 REPUBLIC OF NIGER

Fifth Structural Adjustment Programme (SAP-V) Completion Report

GEOGRAPHIC MAP OF NIGER

This map has been drawn up by the African Development Bank Group exclusively for the use of readers of the report to which it is attached. The names used and the borders shown do not imply on the part of the Group and its members any judgment concerning the legal status of a territory nor any approval or acceptance of these borders.

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MATRIX OF PROGRAMME MEASURES

Measures Taken in March 2005 During Appraisal Objectives Measures to Take During the Programme 2005-2007.

Implementation Deadlines

Implementation Status

1. 2005 Finance Law Act was revised to include the total HIPC debt relief resources and more credit granted to the priority sectors.

1. Strengthening the consistency between the allocations and priorities of the Government in the PRSP and the sector strategies 2. Identify alternate mechanisms for the financing the budget and Treasury 3.Improve budget execution,reduce the differences betweenthe budgets voted and those

1.1- Base the Government’s general budget on the overall MTEFs defining multi-year sector allocations in keeping with the poverty reduction strategy priorities 1.2. - Pursue and intensify efforts for preparing the sector MTEFs and extend the process gradually to all Ministries. 1.3- Submit to the National Assembly the documents that will accompany the draft Finance laws establishing consistency between the budget proposals and the poverty reduction strategy 1.4- Prepare, in consultation with the sectors concerned and the donors, and implement coherent sector strategies and action plans which will serve as basis for future programme budgets: - for basic education

- the entire education sector - for health - for rural development - for public utilities

1.5- In collaboration with the MEF prepare the programme budgets - for basic education

- - Entire education sector - for health - for rural development

- for public utilities 1.6- Reallocate gradually the HIPC funds to activities integrated into the sector programmes of the priority ministries of the PRS, especially vital current expenses for poverty reduction. 1.7 Adopt a plan for broadening the fiscal base especially aimed at the informal sector. 2.1- Gradually increase the funds earmarked for routine

2005-2007 2005-2007 2005-2007 2005 2006 2005 2005-2006 2005-2006 2005-2007 2006 2005 2005 2005 2005-2007 2005-2007

Partly Implemented. The overall MTEF is being designed and professionals of Niger have been trained in France accordingly. The budgets submitted to the National Assembly consolidate the projected current investment expenditure even when the later are financed by the TFPs. Implemented the MTEF for Education, Health and Rural Development have been prepared. Those of Higher Education and Equipment are well underway. Implemented. The budget documents sent to the National Assembly are consistent with the PRS. Implemented. The sector strategies exist: Ten-Year Education Development Programme Framework Programme for the Vocational Integration of Youths, Health Development Plan, Priority Private Sector Recovery Programme, National Infrastructure and IT Development Plan, National Policy for the Promotion of Women, National Micro-finance Development Strategy, Water and Sanitation Policy and Strategy, etc. Some Implemented but for Higher, Secondary and Vocational Education the process is ongoing Implemented. The use of the HIPC funds within the framework of the President’s special programme made it possible to accelerate the construction of priority infrastructure in the Education and Health sectors. Implemented. An aggressive recovery policy was launched with in particular the organization of documented control and setting of objectives by the officer and department. Implemented. The term of the CAFER is determined in order to ensure genuine autonomy in the administrative, technical and financial management of routine road maintenance.

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Implementation Status

2- The spending ministries took part in the preparation of the Annual Treasury Plan for 2005 based on the Amended 2005 Finance law. An appropriate circular letter was sent by the Ministry of the Economy and Finance to all Ministries indicating the modifications made for a better association of spending ministries in the preparation of the quarterly budgetary regulation plans. Strengthening the control and recovery mechanisms at the level of the financial corporations. 3- The Committee in charge of preparing the entry balance for 1996 met and submitted to the Ministry of the Economy and Finance its report comprising the recommendations and a schedule for finalizing the entry balance for 1996 and the use of the management and settlement accounts to update the entry balances after 1996. 4. The Government adopted a decree establishing the statutory regulations applicable to new contractual workers in the health sector with a view to improving the provision of health care in the country’s interior and prepare to decentralize health. This decree aims at determining new positions in the regions. 5- The new national CWIQ 2005 survey which will be used to review the poverty reduction strategy has been launched by INS. The procedure for the recruitment of interviewers started with the publication of a release in the local press. 6- The audit report of the President’s Special Programme has been submitted to donors including the World Bank

executed and secure the priorityexpenditure 4. Simplify and streamline the expenditure channel

5. Prepare the decentralization plan through deconcentration 6. Improve the transparency and

information systems. Prepare to delegate the commitment and order to pay to the Technical Ministries

7. Integrate gradually expenditure on external financing into the expenditure chain.

road maintenance in compliance with the national land transport plan that is being prepared and introduce a financing mechanism designed to secure these funds in the long term. 2.2. Prepare and implement a plan to mobilize resources from domestic and regional financial markets (Treasury bonds) contributing to ease cash flow pressures in the short term 3.1. In each key sector, define and rank the expenditure subject to a special protection; implement the budgetary and treasury regulatory plans, securing such expenses given the seasonal nature of some activities. 4.1. Strengthen the role of the financial controllers and simplify the administrative phase of budget execution by getting rid of redundant control and bringing over to the accounting phase of the Treasure operations. 4.2. Launch the process for the devolution of the expenditure authorization function to some key ministries in the form of a pilot experience. 5.1. Improve the management of delegated credits by expanding the computerized financial management system to the secondary controllers and accountants. Reduce the timeframe for settling these credits. 6.1 Finalize the functions of the integrated financial management system taking into account the liquidation phase in particular and gradually extend this system as follows:

- DGB and Treasury (with accounting interface); - DCF; - Access to an IT room of the MEF on the basis

of a pilot experience; - Customs, Taxes, Debt; - Prepare in 2005, a plan to extend to all

ministries access to the system (2006 and subsequently);

- Extend the system to the DGF and to the investment programme;

2005-2007 2005-2007 200&5-2006 2005-2006 2005-2007 2005 2005-2006

Implemented A plan to mobilize resources from domestic and regional financial markets is prepared and implemented. Two treasury bonds are issued every year on the regional financial market. Implemented. A single list of poverty reduction expenses is available. The expenses of the Ministries and sectors concerned are subject to special protection within the framework of the budgetary and treasury regulation plans. The unified list of poverty reduction expenses has been codified and is part of the nomenclature of the 2007 Budget. Implemented. In the context of the reform of the Ministry of the Economy and Finance, the Directorate of Financial Control was converted into a General Directorate attached to the Office of the Ministry Non Implemented for the time being because linked to the functionality of the pilot room and also because it implies the reform of certain texts (Finance law, Organic Law). Implemented in Part. IT material exists but the sub-expenditure authorization software is yet to be installed. In Progress. Staff training is underway. The computerization carried out so far makes it possible for the General Budget Directorate to monitor in real time, the expenditure and commitment expenditure authorization. In addition, all the 8 local treasury offices have been computerized. This also involves finalizing the link Treasury/Budget which will enable DGB to follow-up in real time payments made by the Treasury of orders issued under the Budget. The Treasury-Budget interface is yet to become operational to enable the Treasury to monitor the administrative phases of budget execution. The computerization process will be gradually extended to all Directorates of the Ministry of the Economy and Finances. Subsequently, in progressively, the Government will complete the computerization process of the

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Implementation Status

and the ADB in respect of actions precedent to the establishment of its budgetary support credit. A programme for the integration of the Special Programme into the sector MTEF has been established. 7. Reactivate the deliberations of the Committee put in place to determine the entry balance.

8. Modernize and restructure the Treasury

9. Improve the situation of the Government’s accounts so as to give a true picture of its assets and financial situation

10. Strengthen and improve the procedures for closing and producing the State’s annual accounts.

- Computerize the operations of the local treasury offices and the decentralized budget offices.

7.1. Collect and send comprehensive expenditure data on external financing. The TFPs will ensure that the financial data concerning their programmes and projects are sent regularly to the DGF 8.1. Modify the organization of the Treasury in compliance with the Organic Law on Budget Laws Separate the normative from the accounting functions. 9.1. Integrate the entry balances into the accounts of the General Treasury Balance 9.2. Integrate into the Treasury operations those financial operations that do not go through the public accountants, especially investment expenditure Implemented with external funding. 9.3 Reduce gradually the use of suspense accounts relative to budgetary operations to be regularized. 9.4 Introduce category 1 and 2 accounts concerning debt and fixed and assets 9.5. Implement the WAEMU guidelines concerning the supplementary day (reduce the duration of the supplementary period). 9.6. Apply Article 104 of the General Public Accounting Regulations (RGCP) that makes provision for a decree and/or an instruction on the conditions for establishing the management account. 10.1 Entrust preparation of the entire budget to the DGB. Prepare a procedures manual for the preparation and implementation of the budget 10.2 Conduct a study on the organization of the MEF departments with the purpose of improving the overall consistency of its action and the efficacy of the

2006 2005 2005-2006 2005-2007 2005-2006 2005-2006 2005-2007 2005-2006 2005-2006 2005 2005-2006 2005-2006 2005-2006

expenditure chain. Implemented in Part. The General Financing Directorate which monitors expenses from external funding is trying to make systematic the arrival of information on project implementation, but according to the results of the 2008 PEFA, the information is always delayed. Implemented in Part. In the context of improving the structure and operation of Ministry of the Economy and Finances, the National Treasury was converted into a General Treasury and Public Accounting Department with the aim of separating the normative from the accounting functions. However, although the key general accountants (ACCT, PGT, and RGT) have been appointed, the delay in the appointment of the General Manager of the new DGTCP, reduces significantly the functionality of this decision. Implemented. It was important to prepare an amnesty law for the management accounts for the year previous to 1999, after which the authorities wanted to start regularizing the management accounts and regulatory laws since they could not be ignored. This law has been submitted to the Government for consideration before its adoption by Parliament. The management accounts and the 2006 regulatory law have already been sent to the Audit Office. Those of 2007 will be ready to accompany the 2010 Finance law. The entry balances are in the process of gradual integration Implemented. However, it must be pointed out that the TFPs submit disbursement data well behind schedule. It would desirable to make submission of such data compulsory in the financing agreements signed with technical and financial partners. Implemented in Part. A more rapid settlement of expenses without previous expenditure authorization is required although budget execution using waivers is still in use.

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11. Strengthen the control and external audit systems.

12. Strengthen the control of monitoring and payment of the external debt and the debt clearance process.

13. Pursue efforts to keep civil service staffing under control and maintain the wage bill within proportions compatible with the resources available

14. Develop and introduce accounting instruments to ensure reliable information of the status of Government property 15. Determine and evaluate budgetary results in line with the Government’s objectives 16. Conduct decentralization

budgetary preparation and to enable the production of accounting data in useful time and optimize the use of human resources. 11.1 Implement the action plan for the control organs (Audit Office, IGF, State Inspection) as defined by the Prime Minister’s Decree N°096 dated 22 December 2003 11.2 Build the capacity of the Audit Office in terms of recruitment of magistrates and auditors, training and methodology (procedures manual, inspection guides) and material means (equipment) 12.1 Register in the Government’s accounting system all operations relative to the external debt, its composition, drawings and repayments 12.2 Clarify the situation of the external debt by compiling studies carried out since 1999 and put in place a credible internal debt clearance plan. 13.1 Strengthen reconciliation of the management indexes, staff and the balance by: (i) Establishing a nomenclature consistent with the appropriate software, provision of the management services with IT material, interconnection with these services to the central registration office and training of managers. ii) a census of the civil service staff 14.1 Adopt and implement the legal texts regarding the management of State property and the WAEMU guidelines. 15.1 Organize a public expenditure review by the MEF and in the priority sectors at the end of each budget year. 16.1 Pursue the implementation of ongoing projects with partners (World Bank, the EU, France, Belgium,

2004-2007 2005-2007 2005 2005 2005 2005 2005 2005-2007 2005-2009

Not Implemented since contrary to the practice in other WAEMU countries, debt management is not the responsibility of the Treasury. Implemented. The supplementary day has been reduced Implemented. A Ministerial Instruction has been issued in that regard Implemented. The General Budget which integrates not only operating but also investment expenses has been completed by the DGB in collaboration with the Ministries and structures concerned. Implemented. The MEF has been restructured with the creation of the General Treasury and Accounting Directorate (DGTCP), the General Financial Control Directorate, the General Public Procurement Directorate, for greater consistency of its action and efficacy in preparing and executing the Budget. Implemented. To strengthen the control and external audit systems, the General Directorate of Financial Control has prepared the Financial Control Manual with the help of the European Union. The General Financial Inspection Directorate implements the inspection programme established and was able to recruit during the course of 2006, seven (7) new inspectors bringing the total number of staff to 18 inspectors following the departure of some inspectors. However, resources (vehicles, computers and training courses) are still lacking. In Progress. A manual on audit guidelines and techniques prepared by a firm with UNDP support. A capacity building programme will be sent to the TFPs including the European Union for financing. Implemented. External debt related operations seem to be in the Treasury balance. Implemented. With the establishment of the CAADIE,

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Implementation Status

activities designed for the 265 communes, l36 departments and 8 regions.

17. Programme Implementation and Monitoring (SAP-V)

18. Implement and monitor the

Decentralization Support Project

Germany, Switzerland, etc.) and launch the diagnostic study on the institutional framework of the decentralization process and current and projected operations with partners with a view to establishing a national decentralization support programme 16.2 Prepare and submit to the ADF a project to support the decentralization process 16.3 Launch studies to supplement the legal and regulatory framework 16.4 Provide appropriate premises to accommodate the community services 16.5 Train the staff of the communes 16.6 Adopt decrees on the establishment of the Commune Support Fund and the Equalization Fund 17.1 Strengthen SAP-V’s executing agency in adequate human and material means. 17.2 Finalize the CWIQ survey and the Budget Consumption survey for the update of the PRS 17.3 Appoint new INS officers 17.4 Finalize the 60 monitoring indicators of the PRS 18.1 Create an implementation unit for the Decentralization Support Project. 18.2 Provide the Unit with adequate human and material resources:

- Appoint by virtue of an appropriate text, the Unit’s staff manager acceptable to the ADB

- Allocate to the Unit adequate premises and put at its disposal the appropriate means of operation.

2005-2006 2005-2006 2006 2005 2005-2006 2005-2009

the internal debt was estimated at CFAF 295 billion in 1999, a large portion of which involved emoluments and salaries which have been paid. There is a balance of about 159 billion to clear. Implemented in Part. The integrated staff management index is being prepared: (i) the MEF and Ministry of Public Administration and Labour are using a common database for government workers from where their salaries are calculated. However, there are still inconsistencies between these two bases which it comes to the management salary emoluments; (ii) A census will be carried out. Not Implemented, although studies have been done With the support of the American Treasury. Physical accounts are not kept at the General Property Directorate, and by the spending ministries. Implemented. This was one condition precedent to the disbursement of the IMF’s 2nd loan tranche Implemented. Concerning continued implementation of projects. A diagnostic study has been launched; it should lead to the National Decentralization Programme Implemented. A decentralization support project is being implemented. In Progress Implemented Implemented. (see the ADF Decentralization and Support to the Communes Project) Implemented. A bank is being established. The Law has been voted and the enabling decrees have been enacted. Implemented. The EMSG stopped its activities with the completion of Programme

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Implementation Status

2005 2005-2006 2005-2006 2005-2009 2005-2006 2005-2006 2005 2005 2005 2005-2006 2005-2006

Implemented. The Unit was established and put under the supervision of the High Commission for State Modernization and Decentralization

Annex 3 REPUBLIC OF NIGER

Fifth Structural Adjustment Programme (SAP-V) Completion Report

Performance of the Borrower

Indicator Rating (1 to 4) Remarks

1. Adherence to time schedule 2.5 Rapid effectiveness of the Programme, i.e. two (2) months after signature. However, the actual start-up of the Programme fell slightly behind schedule (6 months) which led among other things, to the extension of the last disbursement date 30 June to 31 December 2007.

2. Adherence to cost schedule N/A 3. Compliance with conditions and covenants of the Loan Agreement

2 All covenants were complied with except for the general conditions relative to the preparation of the Programme’s completion reports and the audit reports. Compounded by the fact that around 28% of the measures were not implemented (including those implemented in part or ongoing).

4. Adequacy of monitoring-evaluation and reporting

2.5 SAP-V was satisfactorily monitored and evaluated.

5. Satisfactory operation (if applicable)

Not Applicable Not Applicable

Overall Assessment 2.3 Fairly Satisfactory

Annex 4 REPUBLIC OF NIGER

Fifth Structural Adjustment Programme (SAP-V) Completion Report

Performance of the Bank

INDICATOR Rating (1 to 4) REMARKS

1. Identification/Design 3.0 The Programme’s design, especially the scope of the measures and the duration of their implementation took into account the country’s limited institutional capacity

2. Preparation Not Applicable There was no preparation phase 3. Appraisal 2.0 The Appraisal Report was of average quality 4. Supervision 3.5 The Bank’s performance in terms of monitoring was

excellent Overall Assessment 2.8 Highly Satisfactory

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Overall Programme Performance

INDICATOR Rating (1 to 4) REMARKS 1. Relevance and Achievement of Objectives

2.6 Satisfactory

1.1 Macro-economic policy 3.0 By and large the Programme’s performance from the macro-economic standpoint is satisfactory

1.2 Sector Policy 2.5 The sector policy in terms of budgetary allocations to Education and Health is commendable.

1.3 Physical N/A. N/A. 1.4 Financial N/A. N/A. 1.5 Poverty Reduction 3.0 Spending on the education and health sectors rose

from 4.8% of GDP in 2005 to 5.3% of GDP in 2007 and will rise to 6.9% in 2008. Spending on the rural sector rose from 3.3% of GDP in 2005 to 3.7% of GDP and 5.2% of GDP in 2007 and 2008, respectively.

1.6 Environment 2.5 The Programme contains no specifically environmental measure. It must be borne in mind that in the sector strategies of the rural sector and the mining sector, and in the preparation of the MTEFs of these sectors, environmental concerns will be taken into consideration.

1.7 Private Sector Development 2.0 The Programme has no specific private sector development measures. However, it is obvious that the cost of doing business in Niger is relatively high. According to the 2007 Doing Business Classification, Niger ranks 169th in the world, while the average for the WAEMU countries is 160th position. The only public finance management improvement measures (clearance of arrears owed to the private sector, creation of a Public Procurement Inspection Directorate, decrease in the enterprise registration fees) were not enough to make the business environment more attractive

1.8 Governance 2.5 In addition to the decentralization process which is only at its early stages, all the measures of the 1st component including strengthening of the control organs are designed to consolidate the foundations for good governance

2. Institutional Development 2,5 Satisfactory 2.1 Institutional Framework 2.5 The Programme led to the modernization of the

operation of the financial administrations (Budget, Taxation, Customs, Treasury and Public Accounting), and the creation of public finance control organs (General Directorate of Public Procurement Inspection, General Financial Control Directorate and the Audit Office); and the recruitment of 7 finance inspectors.

2.2 Financial and management information system including audit

2.5 An integrated financial management system is being implemented. The Budget-Treasury Directorate interface already exists. The return interface as well as the interconnection project with the CSO is in progress.

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INDICATOR Rating (1 to 4) REMARKS 2.3 Capacity building 2.5 In terms of capacity building, the Programme

organized the training of officials of the Ministry of Finance for the understanding of the new debt management software and the computerization of the public expenditure chain (pilot room), and for the preparation of the MTEF and the programme budget.

2.4 Staffing (including turnover), training and training and counterpart staff

N/A. NA

3. Sustainability 2.6 Satisfactory 3.1 Continued Borrower Commitment

2.5 The Donee’s resolve and determination are real in the conduct of the reforms which is a key factor for the sustainability of the Programme’s achievements.

3.2 Political environment 2,5 The Programme was conducted in a relatively serene political climate. The social unrest in the country’s north did not have any negative impact on the Programme’s implementation.

3.3 Institutional framework 2,5 Despite its limited capacity the Niger Administration proved it could accelerate the implementation of the Programme measures. The institutional reforms advocated (restructuring of the MEF and establishment of the High Commission for ) were carried through.

3.4 Technical viability and further training of staff

N/A. N/A

3.5 Financial viability including cost recovery system

N/A. N/A

3.6 Economic viability 3 The Programme achieved encouraging economic results despite external shocks from the rise in energy and food products on the one hand, and the effects of the 2004 drought on the other.

3.7 Environmental viability N/A. N/A 3.8 Operating and maintenance mechanism (availability of recurrent funds, foreign exchange, spare parts, maintenance workshops.

N/A N/A

4. Internal Rate of Return S.O. Overall Assessment of Outcomes 2,5 Fairly Satisfactory

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RECOMMENDATIONS AND FOLLOW-UP ACTION MATRIX

Areas Main Findings, Conclusions and Recommendations Follow-up Actions Responsibility

Programme Formulation and Implementation

- The design and formulation of reform programmes should necessarily take into account the political context and the Administration’s institutional capacity to ensure implementation of the reforms within carefully set deadlines, ensure ownership and internalization of the reforms by the beneficiary country. Design and formulate a set of limited and precise reform measures that can be implemented within a more or less short time-span, and not dependent on uncontrollable factors such as the modification of the law, a political decision, or major institutional changes, etc. - It is absolutely necessary to pursue implementation of the remaining measures which should contribute to the full computerization of the expenditure chain. - Finalize the update of the economic forecasting model so as to make the macro-economic framework, used to prepare the Budget, more credible. - The special account at the BCEAO is yet to be audited. Similarly, the completion report has not yet been prepared. - Strictly comply with the project cycles and separate the preparation phase from the appraisal phase and conduct in-depth analyses

- Establish a dialogue as far-reaching as possible with all the stakeholders (not only at the design phase but at the implementation phase of the Reform Programme) - Put in place a common matrix of measures to serve as basis for reform programmes - Continue to extend the sector MTEFs - Accelerate the computerization process of the decentralized budget offices (CSO) to ensure more rational management of delegated credits - Tie the production of audit reports to the preparation on the next policy based reform operation in the country. Strengthen the process for quality review of programme design in the Bank

- Bank- Government - Bank-Government and TFPs - Government and TFPs for their technical assistance - Government and Bank

- Bank

Programme Outcomes -The objective to strengthen the macro-economic and growth framework was reached but requires consolidation with time - The conditions for a transparent management of public resources have been set in motion and must be consolidated over time in Niger.

- Finalize implementation of the other measures that have been delayed - Commission management audits in all public sectors by the Control Organs and strengthen their means of intervention. - Continue to make poverty reduction an

- Government - Government

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Areas Main Findings, Conclusions and Recommendations Follow-up Actions Responsibility

- Pro-poor expenditure has increased gradually in the spirit of Programme.

absolute priority of the development strategy. - Continue to back the reform programmes in Niger

- Government - Technical and financial partners including the Bank

Compliance with loan conditions and covenants

- Compliance with loan conditions and covenants is essential for the Programme’s success

- Honour the commitments made especially to prepare the completion report and the reports of the audit of the Special Account at the BCEAO.

- Government

Assessment of Programme performance and outcomes

- The overall assessment of implementation has been satisfactory. - Pursue the dialogue with the authorities to finalize implementation of the remaining measures

- Government and TFPs including the Bank

Sustainability - Sustainability is highly dependent on the Government’s political will and determination to pursue the macro-economic and structural reforms - The success of a reform programme depends also on the country’s institutional capacity to coordinate and implement the actions planned within the set timeframe. - Lastly the Programme's effects will be sustainable if the administrations concerned are more involved. - Direct the next policy-based reform operation towards strengthening the control organs and towards the policies designed to mobilize more domestic resources to cushion the impact of a probable decline in assistance from development partners over the next few years

- Pursue the dialogue in order to consolidate the Programme’s outcomes - Pursue the reform efforts and strengthen the structures in charge of implementation coordination and follow-up and ensure their institutional stability - Internalize further the reform programmes and encourage greater involvement of the administrations. - define the measures to be taken during the implementation of the next reform programme

- Government and TFPs including the Bank - Government Government - Government with the support of the Bank. Bank and Government

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Fifth Structural Adjustment Programme (SAP-V) Completion Report

KEY MACRO-ECONOMIC AND FINANCIAL INDICATORS 92005-2009)

Aggregates/Year 2005 2006 2007 est. 2008 proj. 2009 proj.

Annual Change (in %) Production and Prices GDP at constant prices GDP deflator Consumer price (average

7.4 6.6 7.8

5.2 1.4 0.1

3.2 3.5 0.1

4.4 5.7 5.1

4.5 1.9 2.0

External Sector G&S Exports (fob CFAF) G&S Imports (fob $ US) Terms of Trade (deterioration -)

8.2

30.3 4.9

10.9 -0.9 19.8

30.4 22.4 13.2

17.9 22.4 13.2

6.5

22.2 -0.4

Annual Change in percentage of broad money at the start of the period Money and Credit Net Domestic Assets Domestic credit Central Government Credit to the Economy Money Supply Velocity

1.8 24

-6.3 8.6 6.6 7.1

-17.3 -16.1 -31.6 15.4 16.2 6.5

0.2 -2.5

-13.6 11.2 24.1 5.6

18.5 18.5 11.7 6.8 14.9 5.4

10.0 10.0 3.4 6.7

14.5 5.0

(In Percentage of GDP) Investment and Savings Gross National Savings Gross Investment

13.8 23.1

13.0 21.6

14.0 21.7

11.7 21.3

11.8 26.4

Government Finances Total Revenue Total Expenditure Overall balance commitment basis exclud. Grants (deficit -)

10.8 20.4 -9.6

13.2 20.1 -6.9

15.5 22.3 -6.9

12.8 24.3 -11.5

13.2 23.5 -10.3

Balance of Payments Current balance (exclude. transfers) NPV of External Debt

-12.2 21.8

-10.9 10.2

-10.0 10.5

-13.5 11.1

-17.1 11.9

(In Percentage of Goods and Services Exports) Government debt service 10.4 249.8 2.6 2.9 2.8

(In CFAF Billion except otherwise indicated) Gross official reserves In month of imports Nominal GDP (in CFAF billion)

1.5

1 755.1

3.6

1 871.2

4.7

1 998

4.1

2 207

3.8

2 350 Source: IMF Report N° 08/211 of July 2008

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Fifth Structural Adjustment Programme (SAP-V) Completion Report

Contribution of the Donee

The Bank has still not received the Donee’s contribution.

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Fifth Structural Adjustment Programme (SAP-V) Completion Report

Negative List of Goods and Services for Procurement Consistent with the Appraisal Report

(i) Military and Paramilitary Articles;

(ii) Luxury Products and Goods

(iii) Any Form of Industrial Waste;

(iv) Expenses relative to goods that are part of the Group or Sub-groups of the Standard International Trade Classification (SITC) or any other Group or Sub-group under future revisions of the SITC, shall be excluded from the list of eligible imports.

Product Group

112 Alcoholic beverages;

121 Raw tobacco or un-manufactured tobacco by-products;

122 Manufactured tobacco (even containing tobacco substitutes);

525 Radio-active matter and related products;

667 Natural or cultured pearls, gem and similar, polished or unpolished stones;

718 Nuclear reactors and their parts and spare parts, non-irradiated fuel (cartridges for the nuclear reactors);

897 Gold, silver or platinum related jewellery (with the exception of watches and

time-piece cases) and gold work articles (including mounted precious stones); and

971 Gold for minting money (except minerals and gold concentrates).

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Fifth Structural Adjustment Programme (SAP-V) Completion Report

Sources of Information (Bibliography)

1. Country Strategy Paper (CSP 2005-2009) 2. SAP-V Appraisal Report 3. IMF Report N°08/211 of July 2008 4. Operational Fiscal Revenue Mobilization Strategy and Detailed Action Plan 5. Note on the Implementation of the 2006 Schedule of the PEMFAR’s Priority Action

Plan 6. Official Gazette of Niger: Special Editions N°9, N°11 and N°14 7. 2007 Implementation Report on the 2005-2010 Health Development Plan 8. Study on the level of beneficiary and player satisfaction with Education Services 9. Medium-Term Expenditure Framework (MTEF 2008-2011) of the Ministry of

National Education 10. Year 1 Implementation Report on the second phase of the Ten Year Education

Development Plan (PDDE) 11. Implementation Report on the first phase of the Ten Year Education Development

Plan (PDDE 2003-2007).