Niger: Selected Issues

This Selected Issues paper aims at providing an analytical underpinning for the policy recommendations of the 2022 Article IV Consultation with Niger. The different chapters address key development challenges for the country and contribute to the reflection on policies to build resilience and address fragility. The first chapter assesses the efficiency of social spending. The findings suggest that social programs typically are not well targeted and there are significant coverage gaps. The second chapter explores the state of gender equality and estimates the macroeconomic gains from reducing gaps in education. The third chapter addresses the issue of financial inclusion. The fourth chapter examines the effects of climate and conflict shocks on household welfare. The fifth chapter looks at the economic effects of climate change and food insecurity. Simulations from a general equilibrium model indicate that cash transfers appear more effective than fertilizer subsidies at safeguarding households’ welfare, including nutritional status. The results highlight the need to operationalize better co-ordinated national social safety net system and reform agricultural fertilizer subsidy systems to improve their targeting, efficiency, and sustainability. Finally, the sixth chapter discusses horizontal policies to promote export diversification. The empirical results from panel regressions indicate that reforms to enhance human capital and the quality of infrastructure, to promote digitalization, to remove barriers to trade and improve governance are likely to yield the largest gains in terms of diversification for Niger.