Boko Haram: A threat for the future and a threat to development
Niger is suffering considerable demographic and budgetary pressures. Its margin for manoeuvre to build itself through sustainable development is tight.
With an annual increase of 3.9%, the rate of population growth in Niger is the highest in the world and its population – 17.1 million in the 2012 census – is doubling every 18 years. Young people under the age of 15 represent 51.6% of the population. What is the Government of Niger planning to do for the 34.2 million citizens that will inhabit the country in 2030? Not investing sufficiently in this human and physical capital runs the risk of making young people a pool to be drawn on by the instigators of acts of rebellion or destabilization.
Moreover, the drop in customs revenues at the border with Nigeria, coupled with the increase in public spending (wages and security), is exerting strong pressure on State finances. Estimated at 7.7% of the GDP in 2014, the budget deficit risks being in double digits in 2015, while initial forecasts put it at only 3%.
Despite the impact on public finances of the conflicts in Libya and Mali since 2011, the Government of Niger has, up to now, managed to devote an increasing proportion of its domestic revenue to capital expenditure, to maintaining the payroll and the volume of purchases of goods and services in sustainable proportions (see chart).
Source: Author's chart using data and forecasts from the Nigerien Bank and authorities
In this context, the emergence of Boko Haram on Nigerien soil has dramatic consequences on both the population and on economic activity along the border with Nigeria. The conflict nourished by Boko Haram could lead to the postponement or could even threaten investments that are vital for the sustainable development of the country and could therefore lead to considerable strain on public finances.
If the conflict with Boko Haram were to go on, it could compromise the realization of major foreign direct investments (FDI) for the country and its neighbours. Thus, construction of the pipeline designed to link in with the Niger oil production region and cross Chad to transport oil to the port of Kribi in Cameroon could be delayed. Yet Niger is planning to transport the equivalent of more than 60,000 barrels of oil per day through this pipeline by 2017. Once completed, it could boost the country's oil production, which could reach 24% of market-sector GDP in 2017, against 7.7% in 2014. It is clear that the commitment of Chad alongside Cameroon and Niger in the fight against Boko Haram also raises crucial economic issues for the three countries.
To balance public finances and meet its external liabilities, the Nigerien Government may see an adjustment variable to its capital spending. This is one of the challenges posed by the destabilization of Niger and its neighbours: focusing on security spending at the expense of spending to build the future of the country. This budget trade-off may, of course, defeat Boko Haram for a time, but the lack of infrastructure necessary for the development of isolated areas – such as Diffa – will only act to feed other sources of destabilization and fragility. Hence the importance for the Nigerien Government of maintaining the pace of investment spending, no matter what current security constraints may be. To achieve this in these difficult times, Niger needs to benefit from the full and solid support of all its partners. To this end, the emergency fund (€76 million) that the countries of Central Africa have put together to support the fight against Boko Haram is a step in the right direction. It would be good for West Africa to follow this example.
- KPMG Africa Blog
- UN Women, West and Central Africa
- The Trade Post | Making international trade work for development
- Institute for Security Studies: West Africa
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- CGD Policy Blogs | Center For Global Development
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- blogAfrica | allAfrica
- Baobab | The Economist
- United Nations Office for West Africa
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