Niger – Joint World Bank-IMF Debt Sustainability Analysis

Overview & Synopsis

Despite improvement comparing to the last DSA in 2024, Niger is assessed at high risk of external and overall public debt distress, based on the judgement of still stringent financing conditions, high domestic debt rollover needs, and remaining arrears to creditors. Nevertheless, Niger’s public debt remains sustainable. To address the high debt risks, the authorities have developed a medium-term debt strategy that includes liability management maturity lengthening operations, active exploration of new external financing sources, and other fiscal contingency measures. On the macroeconomic side, over the medium term, growth is supported by crude oil exports. However, significant uncertainty persists with elevated downside risks including insecurity, strained relations with partners, and expected reduction in official development aid (ODA) flows. Against this backdrop, Niger should continue to pursue prudent debt policies by maintaining a zero ceiling on non-concessional debt and avoid relying excessively on higher-cost domestic borrowing to finance the budget. Continuous efforts should be made to entrench sound macroeconomic policies, implement structural reforms, enhance debt management practices, improve public investment management, and increase public spending efficiency to support debt sustainability amid uncertainty. Given Niger’s vulnerability to climate change, it is essential to build resilience through adaptation investments and policies while maintaining fiscal prudence.