Niger

Growth driven by oil but hampered by the partial reopening of the border with Benin

Growth slowed in 2025 after an exceptional performance in 2024 on back of the lifting of post-coup sanctions imposed by neighbouring countries, the resumption of oil exports via the cross-border pipeline with Benin and a strong agricultural harvest. However, activity remains driven by the expansion of the oil sector, which is approaching its maximum capacity of around 110,000 barrels per day. Its contribution is sensitive to changes in crude oil prices and the security of the oil pipeline, reinforced by the January framework agreement with the West African Oil Pipeline Company, the Chinese operator of the pipeline. The commissioning of a mega-refinery at the end of 2025 by the government in partnership with the Canadian group Zimar will enable locally exported oil to be processed in Niger and reduce dependence on imported products from 2026. The performance of other sectors will depend on the reopening of the border with Benin and the restoration of cross-border logistics chains. Uranium exports (20% of exports in 2023) have been frozen failing a diplomatic agreement with Benin and the lack of alternative corridors. Nevertheless, the Canadian company Global Atomic anticipates starting production at the Dasa mine in 2026, using routes via Algeria and Nigeria or the Burkina Faso-Togo corridor. The Société des Mines d'Azelik (Somina), which ceased operations in 2014 due to falling prices, is set to resume mining. At the same time, the nationalisation of the Société des Mines de l'Aïr, which is currently the country’s only uranium producer, 63.4% of which is controlled by the French public company Orano (the rest being owned by the Nigerien state), is set on receiving a larger share of mining revenues. This decision follows the suspension of Orano's exports in July 2023 (closure of the border with Benin following the coup d'état) and the loss of operational control of the company in December 2024. The junta has accused Orano of violating the shareholder agreement by exporting more uranium than its stake allows and of halting operations since July 2023, the situation being attributed to the fact that the company is owned by the French government, deemed to be “a state openly hostile to Niger.” Along the same lines, copper and lithium mining permits have been granted to Compagnie Minière de l'Air, a state-owned company, in order to diversify mining production. Last, the Royal Gold Niger joint venture, launched in April 2025 with the Emirati Suvarna Royal Gold Trading LLC, will set up an industrial complex incorporating a refinery, jewellery workshop, and gold cutting and polishing centre.

The agricultural sector (which accounts for 40% of GDP and 80% of employment) will remain the main growth driver, thanks to favourable weather conditions. Supported by the World Bank through the Large-Scale Irrigation Program, the irrigated area is set to increase from 18,000 to 39,700 hectares by 2027, which will reduce vulnerability to climate shocks and stabilise yields and volumes. In addition, the government has earmarked nearly USD 968 million to recapitalise the Agricultural Bank and stimulate productive investment. The construction sector is benefiting from major energy projects: the Kandadji hydroelectric dam, implemented by the China Gezhouba Group, a future 40 MW thermal power plant financed by Algeria, and the strengthening of the WAPP-Dorsale Nord electricity interconnection. The World Bank has also granted several loans to modernise the road network, particularly on the Zinder–Agadez corridor.

Inflationary pressures peaked in June 2024, driven by rising food prices linked to the 2023 grain deficit and the closure of borders with Nigeria and Benin. Since then, inflation has been declining and is expected to continue falling through to the end of the year thanks to a favourable agricultural season. However, prolonged border closures or deteriorating relations with Benin could reverse this trend. Taking advantage of decling prices at the regional level, the Central Bank of West African States lowered its key interest rate from 3.50% to 3.25% in early June 2025. Despite this monetary support, private investment remains hampered by political and security uncertainty, reduced credit supply due to lower deposits, border closures and the accumulation of public arrears, as well as a high risk of expropriation for Western mining companies.

Declining twin deficits thanks to oil revenues

The budget deficit narrowed in 2024 on back of spending cuts in response to lower tax revenues and international aid, as well as tighter financing conditions. The 2025 budget, set at USD 5 billion (+4.13%), follows the fiscal consolidation programme supported by the IMF. The planned measures include the digitisation and interconnection of tax services, the elimination of exemptions, an extension of VAT to e-commerce, an increase in taxation on non-resident companies, and an increase in property income tax. However, revenue growth is mainly driven by increased oil production and exports, as well as tighter control over mineral resources (uranium and gold). A stabilisation fund is being planned to mitigate the impact of oil price fluctuations. Non-hydrocarbon revenues will increase if cross-border trade normalises. Fiscal consolidation relies mainly on procuring higher revenues as current and investment spending has already been drastically reduced since 2023 to preserve the wage bill and increase security spending. In addition, the commitment to clear debt arrears by the end of 2025 is crimping any fiscal headroom.

Financing needs for 2025 and the current fiscal year are expected to be covered. External financing has increased slightly thanks to credit lines from the African Development Bank and the World Bank following the resumption of IMF programs in July 2024 and their extension until the end of December 2025, notwithstanding the fact that it is well below the level prior to the events of July 2023. The budget deficit recorded in 2024, and in particular the decline in revenues, combined with an accumulation of arrears, led the IMF and the World Bank to classify the overall external debt risk as “high.” At the same time, the public debt profile presents a refinancing risk that is heightened by heavy reliance on short-term borrowing, declining subscription rates and increased dependence on domestic investors.

The current account deficit is expected to narrow thanks to higher oil exports. The nationalisation of foreign extractive companies and controls on foreign workers' wages are reducing net primary income outflows, while expatriate remittances remain robust. At the West African Economic and Monetary Union level, improved current accounts, combined with increased foreign investment inflows, are maintaining comfortable joint foreign exchange reserves that were equivalent to 4.7 months of imports at the end of 2024.

Increased security risk and rejection of long-standing partners

On 26 July 2023, soldiers from the presidential guard overthrew President Mohamed Bazoum, who had been democratically elected in February 2021, alleging poor economic and social governance and a deterioration in the security situation. Joined by other elements of the armed forces, the coup leaders formed the National Council for the Salvation of the Homeland (CNSP), headed by Adourahamane Tiani, who proclaimed himself president. On 26 March 2025, following the February national conference, a new transitional charter came into force and General Tiani was sworn in as president. It sets a five-year transition period before elections in 2030 which can be extended in the event of security risks or delays in reforms. The charter also dissolved the 172 existing political parties, pending a new framework regulating their number and activities. The regime continues to enjoy relative popular support, backing from neighboring juntas and strong economic performance.

But the junta also has to face a high security risk related to the jihadist insurgency coming from Burkina Faso and Mali. Since Western forces were withdrawn from the region, Niger, Mali and Burkina Faso have stepped up their security cooperation, setting up a joint force of 5,000 troops. The rapprochement with Russia, which has led to the deployment of paramilitary forces (Africa Corps), provides an alternative source of external support. The Lake Chad area is also sensitive due to the presence of Boko Haram and Islamic State radicals in West Africa. The president continues to justify the closure of road crossings on the Niger River, the natural border with Benin, accusing the latter of fomenting plans to destabilise Niger and of continuing to host French military bases. In addition, Niger, Mali, and Burkina Faso created the Confederation of Sahel States in July 2024 after announcing their withdrawal from ECOWAS in January 2024. Relations with the West, and particularly France, are very tense, and Niger will continue to strengthen its partnerships with other states.

Last updated: June 2025