HomeReportsBureau of Economic and Business Affairs2018 Investment Climate Statements...Niger

# 					2018 Investment Climate Statements: Niger			

 In this section										/

													Executive Summary											

                -  Executive Summary 
                -  1. Openness To, and Restrictions Upon, Foreign Investment   
                -  2. Bilateral Investment Agreements and Taxation Treaties   
                -  3. Legal Regime   
                -  4. Industrial Policies   
                -  5. Protection of Property Rights   
                -  6. Financial Sector   
                -  7. State-Owned Enterprises   
                -  8. Responsible Business Conduct   
                -  9. Corruption   
                -  10. Political and Security Environment   
                -  11. Labor Policies and Practices   
                -  12. OPIC and Other Investment Insurance Programs   
                -  13. Foreign Direct Investment and Foreign Portfolio Investment Statistics   
                -  14. Contact for More Information   

## Executive Summary

Niger is eager to attract foreign investment and has taken steps to improve its business climate, including making reforms to liberalize the economy, encourage privatizations, and increase imports and exports.

In March 2016, President Issoufou was elected for a second five-year term. During his inauguration speech, he laid out his Renaissance II vision for Niger’s development, highlighting plans to further develop the nation’s mining, petroleum, and industrial sectors, while scaling up the country’s transport infrastructure. He further promised a sustained 7 percent annual GDP growth rate throughout his term in office. Issoufou’s vision incorporates the need for external investment and the Government of Niger (GoN) continues to seek foreign investment – U.S. or otherwise. During a visit to New York in September 2016, on the margins of the 71st UN General Assembly, President Issoufou met with U.S. investors to convey the message that Niger was open for business and would welcome U.S. investment. In December 2017, he repeated the message during a World Bank hosted roundtable in Paris to promote investment opportunities in Niger. The GoN’s Chamber of Commerce has a special unit dedicated to assisting both foreign and Nigerien investors, and the GoN highlights the benefits of doing business in Niger: political stability, economic freedom, an active Chamber of Commerce, and a waiting time of no more than three days to start a business. In 2017, the GoN created the High Council for Investment, which is an organization tasked with supporting and promoting foreign direct investments in Niger. The Permanent Secretary of the High Council reports directly to the President. GoN focus areas for investment include the mining sector, infrastructure and construction (including in preparation for Niamey hosting the 2019 African Union Summit), transportation, and agribusiness.

U.S. investment in the country is very small; many U.S. firms see risk due to the country’s limited transport and energy infrastructure, the perception of political instability and terrorist threats, and a climate that is dry and very hot. Foreign investment dominates key sectors: the mining, transportation and telecommunications sectors are dominated by French firms, while Chinese investment is paramount for the oil and large-scale construction sectors. One other major project being planned is the Kandadji Dam, which will rely on international assistance to fund construction. Much of the country’s retail stores, particularly those related to food, dry goods and clothing are operated by Lebanese and Moroccan entrepreneurs. There are currently no major U.S. firms operating in Niger.

*Table 1*

							1. Openness To, and Restrictions Upon, Foreign Investment					

**Policies Toward Foreign Direct Investment**

The GoN is committed to attracting FDI and has repeatedly pledged to take whatever steps necessary to encourage privatization and increase trade. The country offers numerous investment opportunities, particularly in agriculture, livestock, energy, industry, infrastructure, hydrocarbons, services and mining. In the past several years, new investor codes have been implemented (the most recent being in 2014), transparency has improved, and customs and taxation procedures have been simplified. There are no laws that specifically discriminate against foreign and/or U.S. investors. The GoN has demonstrated a willingness to negotiate with prospective foreign investors on matters of taxation and customs.

The Investment Code adopted in 2014 guarantees the reception and protection of foreign direct investment, as well as tax advantages available for investment projects. The Investment Code allows tax exemptions for a certain period and according to the location and amount of projects to be negotiated on a case by case basis with the Ministry of Commerce. The code guarantees fair treatment of investors regardless of their origin. The code also offers tax incentives for sectors that the government deems to be priorities and strategic, including energy production, agriculture, fishing, social housing, health, education, crafts, hotels, transportation and the agro-food industry. The code allows for free transfer of profits and free convertibility of currencies.

In 2017, the GoN created the High Council for Investment, which is an organization to support and promote investments in the country. The High Council for Investment is within the Presidency. The role of the high council is to promote and facilitate any form of investment and activity; to formulate investment policies and strategies to attract local and foreign investment; to advise the government to coordinate, facilitate and implement Public-Private-Partnership (PPP) projects and improve the number of bankable projects in the portfolios of projects submitted to investors. There is also the investment promotion center (Centre de Promotion des Investissements), which is hosted in the one stop shop at *Maison de l’Entreprise,* created in 2012.

The government put in place an Institutional Framework for Improving Business Climate Indicators (Dispositif Institutionnel d’Amélioration et de Suivi du Climat des Affaires) office, within the Ministry of Commerce, focused on improving business climate indicators. Its goal is to establish a framework that ensures the implementation and follow-up on reforms on doing business in Niger on a permanent basis.

**Limits on Foreign Control and Right to Private Ownership and Establishment**

Foreign and domestic private entities have the right to establish and own business enterprises.

A legal Investment Code governs most activities except accounting governed by the harmonized law of the Organization for the Harmonization of Business Law in Africa (OHADA). The mining sector is governed by the Mining Code and the petroleum sector is governed by the Petroleum Code, with regulations enforced through their respective ministries.

Total foreign ownership is permitted in most sectors except energy, mineral resources, and sectors restricted for national security purposes. In the extractive industries, any company to which the GoN grants a mining permit must give the GoN a minimum 10 percent share of the company. This law applies to both foreign and domestic operations. The GoN also reserves the right to require companies exploiting mineral resources to give the GoN up to a 33 percent stake in their Nigerien operations. Foreign ownership of land is permitted but requires authorization from the Ministry of Planning. In 2015, under the auspices of the Ministry of Commerce, the GoN validated a new Competition and Consumer Protection Law, replacing a 1992 law that was never fully operational. Niger also adheres to the Community Competition Law of the West African Economic and Monetary Union (WAEMU).

Article 10 of the country’s Investment Code, states that the *Commission des Investissements* (investment commission) has the right to review an investment proposal if a foreign investor requests government approval for such a proposal. The commission can also impose sanctions if the foreign firm failed to abide by the procedures outlined in the Investment Code. The law guarantees equal treatment of investors regardless of nationality. The company is guaranteed against any measure of nationalization, expropriation or requisitioning throughout the national territory, except for reasons of public utility.

The state remains the owner of water resources through the Niger Water Infrastructure Corporation (SPEN), created in 2001 and is responsible for the management of the state’s hydraulic infrastructure in urban and semi-urban areas, of its development, and project management. Concessions for the use of water and for the exploitation of works and hydraulic installations may be granted to legal persons governed by private law, generally by decree.

An investment screening mechanism does not exist under the Investment Code.

U.S. investors are not disadvantaged or singled out by any of the ownership or control mechanisms, sector restrictions, or investment screening mechanisms, relative to other foreign investors.

**Other Investment Policy Reviews**

In the past three years, the government has not undergone any third-party investment policy reviews through a multi-lateral organization. Neither the United Nations Conference on Trade and Development (UNCTAD), nor the Organization for Economic Cooperation and Development (OECD) has carried out a policy review for Niger.

**Business Facilitation**

Niger’s one-stop shop, the *Maison de l’Entreprise* is mandated to enhance business facilitation by mainstreaming and simplifying the procedures required to start a business within a single window registration process. From 2016 to 2017, the cost and time needed to register businesses was reduced from 100,000 CFA (about USD190) to 17,500 CFA (about USD33). Further reforms have included the creation of an e-regulations website (https://niger.eregulations.org/procedure/2/1?l=fr ), which allows for a clear and complete registration process. Foreign companies may use this website. The website lists government agencies, with which a business must register. The business registration process is about 3 days, down from over 14 days in 2016.

Niger business facilitation mechanism provides equitable treatment of women and underrepresented minorities in the economy. Niamey’s Abdou Moumouni University, funded by the GoN, created an incubator center in 2017 to promote entrepreneurship among students, including women. Women entrepreneurial organizations state that the government does not encourage, assist, or facilitate women or young entrepreneurs to access public tenders.

**Outward Investment**

While the GON does not restrict domestic investors from investing abroad, there is very little FDI extending from businesses within Niger to other nations.

In the foreground of the government’s trade policy objectives, which were specified in the second Nigerien Renaissance Program (section 1.2), is the development of international markets, especially that of ECOWAS, for Nigerien exports.

							2. Bilateral Investment Agreements and Taxation Treaties					

Niger currently has active Bilateral Investment Treaties (BITs) with Germany and Switzerland. BITs with Algeria, Tunisia and Egypt have been signed but are not in force. Niger is eligible to export virtually all marketable goods duty-free in to the U.S. market via the African Growth and Opportunity Act (AGOA) system of trade preferences except for textile goods.

Niger does not have a bilateral taxation treaty with the United States. However, the United States has a Trade and Investment Framework Agreement (TIFA) with the WAEMU, which includes Niger. There is no ongoing systemic tax dispute between the government and foreign investors.

							3. Legal Regime					

**Transparency of the Regulatory System**

The GoN possesses transparent policies and requisite laws to foster competition on a non-discriminatory basis, but does not enforce them equally, in large part due to corruption and weak governmental systems. Legal, regulatory, and accounting systems are generally transparent and consistent with international norms. The Legal Regime – related to the Investment Code, Labor Code and Commercial Acts – applies the provisions of the Organization for the Harmonization of Business Law in Africa (OHADA). It also offers free access to public procurement and transparency in the procedures for awarding contract.

Rule-making and regulatory authorities exist in telecommunication, public procurement and energy and are exercised at the national level. The law No 2015-58 established the Energy Sector Regulatory Agency, an independent administrative authority, to regulate the energy sector. The December 2012 law No 2012-70 created the Telecommunications and Post Office Regulatory Authority (ARTP).

As an example, the ARTP regulates telecommunications operators, including the inspection of sites and measurement and occupation of the spectrum, the control of tariffs of the services of the telecommunications, the quality control of the services, control of other obligations of cellular operators, management of interconnection, monitoring of markets, and studying the effects of electromagnetic fields on health.

Ministries or regulatory agencies do not conduct an impact assessment of proposed regulations. However, ministries or regulatory agencies solicit comments on proposed regulations from the general public through public meetings and targeted outreach to stakeholders, such as business associations or other groups.

Niger does not have any regulatory processes managed by nongovernmental organizations or private sector associations. A company in Niger must be entered in the Register of Companies, must obtain a Tax Identification Number (TIN), be registered with the National Social Security Fund (CNSS), and with the National Employment Promotion Agency (ANPE). There, however, is a large informal sector that does not submit to any of the legal provisions and is not formally regulated.

Legal, regulatory, and accounting systems are generally transparent and consistent with international norms. The Legal Regime – related to the Investment Code, Mining Code, Petroleum Code, Labor Code and Commercial Acts – applies the provisions of the Organization for the Harmonization of Business Law in Africa OHADA. It also offers free access to public procurement and transparency in the procedures for awarding contracts.

GoN officials have confirmed their intent to comply with international norms in its legal, regulatory, and accounting systems, but frequently fall short. Clear procedures are frequently not available. Draft bills are not always available for public comment, although the Chamber of Commerce or other organizations may be allowed to offer suggestions.

Foreign and national investors can find detailed information on administrative procedures applicable to investment at the following site: http://niger.eregulations.org/ . The site includes information on income generating operations including the number of steps, name and contact details of the entities and persons in charge of procedures, required documents and conditions, costs, processing time, and legal basis justifying the procedures.

Niger has in place a mechanism for the management of administrative processes. The initiative has been reinforced by incentives for state employees, unannounced controls in public administrations, and an introduction of the sign-in system and exchange meetings. A General Inspectorate of Administrative Governance and the Regional Directorates of Archives are in place to oversee administrative processes.

Niger does not have a centralized online location where key regulatory actions are published, but does have a Directorate of National Archives where Key regulatory actions are kept in print. No major regulatory system and/or enforcement reforms were announced in 2016.

In general regulations are developed as a means of solving a clearly identified problem in order to achieve a precisely defined result. Regulations are developed via a system of ministerial collaboration and discussions, consultation with the State Council, selection of the text and passage by the Council of Ministers. This is followed by discussions in Parliament, approval by the Constitutional Council and finally the publication of the regulations.

In Niger, regulatory power belongs to the President of the Republic and the Prime Minister who can issue regulations for the whole of the national territory. Other administrative authorities also have regulatory power, such as ministers, governors, or prefects and mayors, who have the power of enforcement at the local level.

Ministries or regulatory agencies do not conduct an impact assessment of proposed regulations. However, ministries or regulatory agencies solicit comments on proposed regulations from the general public through public meetings and targeted outreach to stakeholders, such as business associations or other groups.

**International Regulatory Considerations**

Niger is a part of the Economic Community of West African States (ECOWAS), a 15-member West African trade block. National policy generally adheres to ECOWAS guidelines concerning business regulations.

Niger is a member of the U.N. Conference on Trade and Development’s international network of transparent investment procedures: http://niger.eregulations.org/  (French language only). Foreign and national investors can find detailed information on administrative procedures applicable to investment and income generating operations, including the number of steps, name and contact details of the entities and persons in charge of procedures, required documents and conditions, costs, processing time, and legal bases justifying the procedures.

Niger is a member of the WTO, but as a lower income member, is exempt from Trade-Related Investment Measures (TRIMs) obligations. The GoN does not notify all draft technical regulations to the WTO Committee on Technical Barriers to Trade (TBT). Niger ratified the Trade Facilitation Agreement (TFA) in August 2015. The country has recorded some progress when implementing the TFA requirements.

**Legal System and Judicial Independence**

Niger’s legal system is a legacy of the French colonial system. The legal infrastructure is insufficient, making it difficult to use the courts to enforce ownership of property or contracts. While Niger’s laws protect property and commercial rights, the administration of justice can be slow and unequal.

Niger does have a written commercial law that is heavily based on the Organization for the Harmonization of Business Law in Africa (OHADA). Niger has been a member of OHADA since 1995. OHADA aims to harmonize business laws in 16 African countries by adopting common rules adapted to their economies, setting up appropriate judicial procedures, and encouraging arbitration for the settlement of contractual disputes. OHADA regulations on business and commercial law include definition and classification of legal persons engaged in trade, procedures for credit and recovery of debts, means of enforcement, bankruptcy, receivership, and arbitration.

In 2015, Niger set up a Commercial Court in Niamey. No statistics are available on the activities of the Commercial Court.

Article 116 of the constitution clearly states that the judicial system is independent of the executive and legislative branches. However, the personnel management process for assignments and promotions is directly connected to politically-appointed personnel in the Ministry of Justice, seriously weakening the independence of the judiciary and raising questions about the fairness and reliability of the judicial process.

Regulations or enforcement actions are appealable and adjudicated in the court system. However, it is extremely rare for individuals or corporations to challenge government regulations or enforcement actions in court. In one recent case, the government ordered that roadside bill-boards be taken down. Airtel and Orange, two large multi-national corporations that provide cell phone and Internet service in Niger, challenged the government order in court because roadside billboards were their primary form of advertising. Although the case received no final public report through the courts, billboards remained in place through 2017.

**Laws and Regulations on Foreign Direct Investment**

Niger offers guarantees to foreign direct investors pertaining to security of capital and investment, compensation for expropriation, and equality of treatment. Foreign investors may be permitted to transfer income derived from invested capital and from liquidated investments, provided the original investment is made in convertible currencies.

Law 2015-08 from 2015 established a specialized Commercial Court in Niamey. This is a mixed court with professional magistrates, who are lawyers by training, who work in tandem with lay-judges, and who generally come from the commercial sector. The concept was to have commercial disputes resolved by a panel of judges with legal training, combined with judges who have experience in the commercial sector. The Commercial Court has a total of 26 judges, who are spread across five chambers. Unlike U.S. trial courts, where cases are handled by a single judge, in Niger, cases are adjudicated by a panel of judges. After passage of the law in 2015, the Commercial Court began operations in 2016.

Niger does not have a dedicated one-stop shop website for investment, but the Chamber of Commerce and Industry houses a specialized institution, known as the Investment Promotion Center (CPI) which supports domestic and foreign investors in terms of business creation, extension and rehabilitation.

**Competition and Anti-Trust Laws**

Under the auspices of the Ministry of Trade, the GoN in 2015 validated a new Competition and Consumer Protection Law, replacing a 1992 law that was never fully operational. Niger also adheres to the Community Competition Law of the West African Economic and Monetary Union (WAEMU).

**Expropriation and Compensation**

The Investment Code guarantees that no business will be subject to nationalization or expropriation except when deemed “in the public interest” as prescribed by the law. The code requires that the government compensate any expropriated business with just and equitable payment. There have been a number of expropriations of commercial and personal property, most of which were not conducted in a manner consistent with Nigerien law requiring “just and prior compensation.” It is in fact rare for property owners to be compensated by the government after expropriations of property.

The last instance of expropriation occurred in 2010, at which time the GoN unilaterally terminated the operating license of a consortium of foreign investors from Libya and China that had purchased the national telecommunications provider Sonitel upon privatization in 2002. The GoN claimed the foreign firms failed to meet the terms of the original agreement regarding investment in new equipment and additional capacity.

In cases of expropriation carried out by the GoN, claimants and community leaders have alleged a lack of due process. These complaints are limited to community forums and press coverage where people vent their anger and frustration over property expropriations. Many Nigeriens, especially those from the lower strata of society, lack the knowledge and ability to exercise their rights under the law. High rates of illiteracy, complexity of the legal system, and lack of resources to retain competent legal counsel present insurmountable barriers to legal remedies for people whose property has been expropriated. Even in situations where educated and wealthy business owners have had their property expropriated, legal challenges to expropriation are not lodged.

**Dispute Settlement**

Niger is a contracting state of both the ICSID Convention and the New York Convention of 1958.

There is no domestic legislation providing for enforcement of awards under the 1958 New York Convention and/or under the ICSID Convention**.**

The Investment Code offers the possibility for foreign nationals to seek remedy through the International Center for the Settlement of Investment Disputes.

Niger does not have a BIT or FTA with the United States.

Over the past 10 years, there were no investment disputes that involved a U.S. person.

Local courts are generally reluctant to recognize foreign arbitral awards issued against the GoN.

Niger does not have a record of extrajudicial actions against foreign investors.

Niger has an operational center for mediation and arbitration of business disputes. The center’s stated aim is to maintain investor confidence by eliminating long and expensive procedures traditionally involved in the resolution of business disputes.

The Investment Code provides for settlement of disputes by arbitration or by recourse to the World Bank’s International Center for Settlement of Disputes on Investment. However, investment dispute mechanisms in contracts are not always respected and exercising due diligence is extremely important.

There was no publicly available information in 2017 on foreign arbitral award enforcement in Niger.

Procedures are in place but are often not adhered to because of a lack of resources and corruption in the judicial system. The Investment Code offers the possibility for foreign nationals to seek remedy through the International Center for the Settlement of Investment Disputes.

**Bankruptcy Regulations**

Niger has laws related to insolvency and/or bankruptcy. Creditors have the right to object to decisions accepting or rejecting a creditor’s claims, and may vote on debtors’ bankruptcy reorganization plans. However, the creditors’ rights are limited: creditors do not have the right to receive from a reorganized firm as much as they may have received from one that had been liquidated. Likewise, the law does not require that creditors be consulted on matters pertaining to an insolvency framework following the declaration of bankruptcy. Bankruptcy is not criminalized.

According to data collected by the World Bank’s Doing Business survey, resolving insolvency takes five years on average and costs 18 percent of the debtor’s total assets. Globally, Niger stands at 105 in the 2017 ranking of 190 economies on the ease of resolving insolvency.

							4. Industrial Policies					

**Investment Incentives**

Niger offers incentives that are dependent on the size of the investment and number of jobs that will be created. The Investment Code offers VAT-inclusive tax exemptions depending on the size of the business. Potential tax exemptions include start-up costs, property, industrial and commercial profits, services and materials required for production, and energy use. Exemption periods range from ten to fifteen years and include waivers of duties and license fees. There are no restrictions on foreign companies opening a local office in Niger, though they must obtain a business certificate from the Ministry of Trade.

The Investment Code has established three different tiers of incentives for investors, based on minimum investment amounts, listed below:

- Tier 1: Promotional tier, for investments of 25 million CFA francs (about USD40,000) or above.
- Tier 2: Priority tier, for investments of 50 million CFA francs (about USD81,000) or above.
- Tier 3: Conventional tier, for large businesses with investments of at least 2 billion CFA (about USD3.25 million)

During the investment phase, the approved investments are exempt from import duties and taxes on material and equipment needed for the project that are not available locally. The advantages provided during the operational phase include exemption from profit tax (35 percent). Apart from these regimes, two additional incentive schemes are part of the investment code. These apply to companies operating in remote regions, energy, agro-industry, and low-cost housing sectors.

**Foreign Trade Zones/Free Ports/Trade Facilitation**

In 2016, the GON approved a new Customs Code to replace the current one which had been in place for 55 years. The new code is supposed to reflect the aspirations of actors within the international supply chain and is in conformity with the requirements of Community Customs Codes of the West African Economic and Monetary Union (WAEMU) and the Economic Community of West African States (ECOWAS).

In 2017, the GON modernized the customs procedures with the electronic payment tax which is efficient in Niamey and will be expanded to regions of Niger in 2018. In 2016, internal customs procedures migrated to SYDONIAWORLD, a system designed to improve efficiency and permit centralized oversight and control. In 2015, Niger was the first Least Developed Country (LDC) to ratify the World Trade Organization’s Trade Facilitation Agreement (TFA). The country seeks to implement the trade policy of the West African Economic and Monetary Union (WAEMU) and has joined the Generalized System of Preferences (GSP) of the European Union.

Niger is landlocked, has no free trade zones, and relies on the ports of Cotonou in Benin and Lomé in Togo as its primary seaports. Importers also use the ports of Tema, in Ghana and sometimes Lagos, Nigeria. Delivery can take months due to delays at borders and internal control points along the route. The relatively low number of commercial flights to Niger means that transport costs are high. The country’s main trade partners are Nigeria, the European Union, the United States, China, Cote d’Ivoire, and Algeria.

**Performance and Data Localization Requirements**

Performance requirements are not imposed as a condition for establishing, maintaining, or expanding foreign direct investments.

While Niger does require that companies attempt to hire a Nigerien before applying for a work visa for a foreign national, in practice the rule is not enforced. In addition, it allows for a company to appeal to the Ministry of Labor, if a foreigner is refused a work visa.

To create a suitable environment for promoting private investment and job creation, labor and employment legislation has been reformed to allow flexibility in employment and to adapt vocational training to the requirements of the job market.

In addition, it allows for a company to appeal to the Ministry of Labor, if a foreigner is refused a work visa.

There are no forced localization policies requiring investors to use domestic goods in content.

Niger has no regulations regarding data storage. Niger does not require foreign IT providers to turn over source code and/or provide access to surveillance.

The Ministry of Post, Telecommunication and Numerical Economy is the responsible agency.

Niger has one of the lowest internet penetration rates in the world. Technology in-country lags far behind the developed world.

Niger has no laws regarding investment performance requirements.

							5. Protection of Property Rights					

**Real Property**

Interests in property are enforced when the land holder is known, but property disputes are common, particularly involving community-owned land or land in rural areas where customary land titles are still common. There are no data available regarding the percentage of land that is untitled. Mortgages are relatively new instruments; Bank Atlantique introduced the first mortgages in 2014. The bank retains the title to the property until the loan is repaid. Traditional use rights are at the core of land disputes between Nigerien farmers and traditional nomadic herders. According to data collected by the World Bank’s 2017 Doing Business survey, registering property in Niger requires four procedures, takes 35 days and costs 9 percent of the property value. Globally, Niger stands at 125 in the ranking of 190 economies on the ease of registering property. In 2014, Niger made transferring property easier by reducing registration fees. Foreign ownership of land is permitted but requires authorization from the Ministry of Planning. The 2018 Finance Law has changed tax policies and thus ownership requirements, but was not yet in force at year’s end.

**Intellectual Property Rights**

As a signatory to the 1983 Paris Convention for the Protection of Industrial Property, Niger provides national protection under Nigerien patent and trademark laws to foreign businesses. Niger is also a member of the World Intellectual Property Organization (WIPO) and a signatory to the Universal Copyright Convention.

No new IP laws or regulations have been enacted in the past year. Niger does not regularly track and report on seizures of counterfeit goods. There is no specific information about working conditions in the production or sale of counterfeit goods. While there have been some cases of seizure, government statistics are not available. Niger is not listed in the USTR’s Special 301 Report nor the notorious markets report.

There was no information available for 2017.

Investors can find more information at: http://www.wipo.int/members/en/contact.jsp?country_id=127 

							6. Financial Sector					

**Capital Markets and Portfolio Investment**

Niger’s capital markets are extremely underdeveloped and there is no stock market. Although an effective regulatory system exists, and policies in fact encourage portfolio investment, there is little market liquidity and hence little opportunity for such investment. The agency UMOA-Titres (AUT) is dedicated to helping member states use capital markets to raise the resources they need to fund their economic development policies at reasonable cost.

There are no limits on the free flow of financial resources.

The government otherwise works closely with the IMF to ensure that payments and transfers overseas occur without undue restrictions. Credit is allocated on market terms and foreigners do not face discrimination.

Credit to the private sector is dominated by large corporations, while agriculture, livestock, forestry, and fisheries sectors (which account for more than 40 percent of GDP) receive less than one percent of total bank credit.

**Money and Banking System**

Although the banking sector in Niger is generally healthy and well capitalized, less than three percent of Nigeriens have a bank account.

Foreign banks control about 80 percent of the sector’s assets, with SONIBANK, BIA Niger, Ecobank and Bank of Africa (BOA) being the largest banks operating within the country, with estimated combined assets at USD1.34 billion.

The Central Bank of West African States governs Niger’s banking institutions and sets minimum reserve requirements.

There are no restrictions on a foreigner’s ability to establish a bank account, and foreign banks and their subsidiaries operate within the economy without undue restrictions. Niger is a part of the West African Economic and Monetary Union (WAEMU), which utilizes the franc CFA, pegged to the Euro at 655.61 CFA per euro.

**Foreign Exchange and Remittances**

There are no restrictions or limitations placed on foreign investors in converting, transferring, or repatriating funds associated with an investment, including remittances.

Funds are freely convertible into any world currency. However, currency conversions above 2 million CFA (approximately USD3,413) must be approved by the government.

The exchange rate is determined via the euro’s fluctuations on the international currency market. The CFA is otherwise fixed to the euro.

Niger’s Investment Code offers the possibility to transfer income of any kind, including capital investment and the proceeds of investment liquidation, regardless of the destination.

There are no limitations or waiting periods on remittances, though currency conversions above 2 million CFA (approximately USD3,250) must be approved by the Ministry of Finance.

**Sovereign Wealth Funds**

Niger does not maintain a Sovereign Wealth Fund (SWF), and does not subscribe to the Santiago Principles. The government has ambitious plans for a build-up of reserves at the Central Bank of West African States (BCEAO) using oil revenues.

							7. State-Owned Enterprises					

State-Owned Enterprises (SOEs) in Niger are defined as companies in which the GoN is the majority stakeholder. They play a major role in Niger’s economy and dominate or heavily influence a number of key sectors, including energy (NIGELEC), telecommunications (Niger Telecom), and water resources (SEEN and SPEN), construction and retail markets (SOCOGEM); petroleum products distribution (SONIDEP); mining (SOPAMIN); and hotels (SPEG).

There is no published list of SOEs.

According to the 2016 Public Expenditures and Financial Accountability (PEFA) draft document, there are eight wholly-owned SOEs, and six SOEs majority-owned by the state. State-Owned enterprises are answerable to their supervisory ministry and send certified accounting records to the supervisory ministries and to the Public Enterprises and State Portfolio Directorate (DEP/ PE). SOE record-keeping is expected to comply with SYSCOHADA accounting system standards.

There are no laws or rules that offer preferential treatment to SOEs. They are subject to the same tax rules and burdens as the private sector, and are subject to budget constraints. Niger is not a member of the OECD and does not adhere to its guidelines.

**Privatization Program**

Most sectors of the economy, with the exception of SOEs, have been privatized. The state-owned oil-distribution company (SONIDEP) no longer has a monopoly over oil exportation; exportation authority is now equally shared between SONIDEP and the Chinese National Petroleum Corporation (CNPC). Likewise, although the national electricity company (NIGELEC) continues to hold a virtual monopoly on electricity distribution, steps have been taken in 2016 to allow third party access to the country’s electricity grid. This should pave the way for future privatization. Competition in the mobile telecommunication sector forced the GoN to combine state-owned fixed line telecommunications provider SONITEL with the state-owned mobile provider Sahelcom to form a new parastatal, known as Niger Telecom. Although the state continues to hold a monopoly on fixed-line telephony, mobile communications is open to competition.

Foreign investors are welcome to participate in the country’s privatization program. Privatization operations are conducted under the technical direction of the ministry that currently controls the company. After a detailed analysis of business operations conducted by an internationally known independent audit firm, the government issues a call for bids.

							8. Responsible Business Conduct					

The concept of responsible business conduct (RBC) has been gradually incorporated into the core of Nigerien business operations to increase share value for businesses and society, and is included in the country’s mining codes. There is a general awareness of expectations regarding RBC, as well as business’ obligations to proactively conduct due diligence and do no harm.

In the extractive industries sector, the GoN has focused on ensuring existing obligations are met and that communities benefit. Nigerien law states that 15 percent of revenues derived from extractive industries must be returned to the municipality affected by the project. However, such payments are difficult to track and the GoN is not active or engaged in follow-up.

There have been no high-profile instances of private sector impact on human rights in the recent past. The GoN attempts to enforce domestic laws related to human rights, labor rights, consumer protection, and environmental protections. However, a lack of resources makes such enforcement difficult and only somewhat effective.

In 2017 the GON strengthened minority investor protection by introducing a provision whereby a winning party’s legal expenses are reimbursed by the losing party, thus making it less financially daunting for minority shareholders to challenge large corporations in a court of law. Likewise, shareholders representing 10 percent of a company’s market capitalization may call for an extraordinary meeting of shareholders. RBC is promoted by most workers’ unions and is regularly monitored by civil society and NGOs. These organizations are able to do their work freely.

The government has not put in place corporate governance, accounting, and executive compensation standards.

There is limited NGO focus on responsible business practices. Those looking at transparency in contracts and business practices are generally able to work freely regarding engagement with businesses.

Niger is not a member of the OECD and does not adhere to OECD guidelines, including those related to supply chains of minerals from conflict-affected and high-risk areas. There are no Nigerien-owned companies that deal exclusively with minerals, including those that may originate from conflict-affected areas.

The GoN had been a member of the Extractive Industry Transparency Initiative (EITI) since 2007, but the country withdrew following the Board’s decision in October 2017 to suspend Niger on the basis of inadequate progress. The constitution mandates full disclosure of all payments from foreign government stemming from mining operations, as well as publication of all new exploration and exploitation contracts in the mining sector. However, in practice, payments from foreign countries to GoN officials have at times been controversial due to non-reporting of such payments.

							9. Corruption					

The constitution, adopted in 2010, contains provisions for greater transparency in government reporting of revenues from the extractive industries, as well as the declaration of personal assets by government officials, including the President. Since his re-election in February 2016, President Issoufou has made combatting corruption within the GON one of the focus points of his presidency.

Laws related to anti-corruption measures are in place and apply to government officials, their family members, and all political parties. Likewise, Niger has laws in place designed to counter conflict of interest in awarding contracts and/or government procurements. Bribery of public officials by private companies is officially illegal, but is known to occur regularly despite GON denunciations of such conduct.

Within the law No 2011-37 of October 28th, 2011 laying down general principles of control and regulation of public markets and public service delegations, the country has law and regulations to counter conflict-of-interest in awarding contracts or government procurement.

The government/authority encourages or requires private companies to establish internal codes of conduct that, among other things, prohibit bribery of public officials.

Some private companies use internal controls, ethics, and compliance programs to detect and prevent bribery of government officials.

Niger is ranked 112 out of 180 in Transparency International’s 2017 Corruption Perceptions Index; compared to last year the country lost 11 points. However, there has been a remarkable improvement since 2011, when the country was ranked at 134.

Niger has joined several international and regional anti-corruption initiatives including the UN Convention against Corruption in 2008, the African Union Convention on Preventing and Combating Corruption in 2005, and the Protocol on Combating Corruption of the economic community of the states of West Africa (ECOWAS) in 2006. Niger is also member state of the GIABA, which is an institution of the Economic Community of West African States (ECOWAS) responsible for facilitating the adoption and implementation of Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) in West Africa.

The government does not provide any additional protections to NGOs involved in investigating corruption.

Corruption hinders economic growth and discourages direct investment.

No such local industry exists.

Contact at government agency or agencies are responsible for combating corruption:

Gousmane AbdourahamanePresidentHigh Authority to Combat Corruption and Related Infractions (HALCIA)BP 550 Niamey – Niger(227) 20 35 20 96issoufbour@gmail.com

Contact at “watchdog” organization:

Mme Bagna Aissata FallPresidentNigerien Association against Corruption (ANLC), Chapter of Transparency InternationalBP 10423, Niamey – Niger(227) 20 74 10 90 / 20 74 04 61anlcti@yahoo.fr

Bribery of public officials occurs on a regular basis. Though most companies officially discourage such behavior, internal controls are rare except among the largest (mostly foreign) enterprises.

As of April 2017, there are no U.S. firms invested in Niger, for reasons which include – but are not limited to – the perception of corruption. Cases of suspected corruption occasionally appear in media reports concerning GON procurement, the award of licenses and concessions and customs.

In a recent study conducted by the Nigerien High Authority to Combat Corruption and Related Infractions (HALCIA), it stated that the public sector is the most corrupted, then political organizations, civil society organizations, then traditional chiefs and the private sector is the least corrupted. In the public sector the most corrupted is the customs, then tax services, then the police.

							10. Political and Security Environment					

Niger has been politically stable since 2010, when the most recent of Niger’s coup d’états (there have been four since 1990) concluded within less than a year in a return to democratic governance. The most recent general elections were held in in February 2016, with a presidential run-off in March 2016. President Issoufou Mahamadou was re-elected for a second mandate by a considerable majority. Tensions over the preparation of the elections and election logistics widened divisions between opposition activists and supporters of the incumbent president and his ruling Nigerien Party for Democracy and Socialism (PNDS). However, the election proceeded without violence.

Although Niger’s politics are often contentious and antagonistic, political violence is rare. Most parties agree that national security and peaceful cohabitation among Niger’s ethnicities are the government’s principal priority. However, protests and strikes about non-payment of salaries for public employees, lack of funding for education, and general dissatisfaction with social conditions remain a concern.

Public protest over issues like poverty, corruption, and unemployment can also sometimes turn violent. In October 2017, police arrested several protesters engaged in burning tires and vandalizing property in protest of a proposed finance law. After the passage of the law, protests continued on a bi-weekly and then weekly basis through at least April 2018. The protests became increasingly contentious as the year progressed, and in March and April 2018, police began to intervene and several people were arrested, including important civil society leaders. The government banned further protests related to the finance law after March 25.

Nigerien students regularly participate in peaceful protests, and on occasion, these become violent. In April 2017, one student in Niamey was killed at a protest, hit in the head by a teargas canister. In April 2018, a student protest again turned violent, resulting in several serious injuries.

Nigeriens are generally welcoming to foreigners and foreign investment is welcomed by all elements of society. One rare exception to acceptance of foreigners occurred in January 2015 after President Issoufou was perceived to be too forgiving of anti-Muslim satire that had been published on the cover of the French magazine, *Charlie Hebdo*. In three days of riots throughout the country, at least ten people killed and dozens of Christian churches, market stalls, French-owned businesses, some political-party linked buildings, two private homes, and a Christian school were attacked.

Niger experiences security threats on three distinct border areas. The collapse of the Libyan state to the north has resulted in a flow of weapons and extremists throughout the Sahel region. Boko Haram and ISIS-West Africa terrorists regularly launch attacks in the Diffa Region in Niger’s southeast, leading to numerous civilian and security forces deaths. Jama’at al Nusrat al-Islam wa al-Muslimin (JNIM), which is a loose affiliation of al-Qaeda in the Islamic Maghreb (AQIM), the Macina Liberation Front (MLF), Ansar Dine, and al-Mourabitoun; along with ISIS-Greater Sahara (ISIS-GS), threaten Niger’s northern and northwestern borders. Terrorists regularly crossed the Mali border to attack civilian and security sites in the Tillaberi and Tahoua regions. A German aid worker was kidnapped in Tillaberi in April 2018, and an American aid worker was kidnapped in Tahoua in October 2016. The State Department’s Travel Advisory for Niger from April 2017 advises travels to be aware that violent crimes including robbery are common and terrorism is a threat.

							11. Labor Policies and Practices					

Niger has an abundance of available labor, primarily unskilled. One of the most pressing concerns within the Ministry of Labor is the lack of jobs available to recent high school and university graduates, who often face long spells of unemployment or underemployment. There is very high unemployment among young workers, many of whom are uneducated and illiterate. Migration from the rural areas to the cities is a problem, as the majority of recently-arrived workers are unskilled. Such workers most often turn up in the informal economy. While informal activities are generally not reported, Ministry of Finance estimates from 2012 stated that between 80 and 90 percent of the non-agricultural workforce is in the informal economy. Niger, as part of the Economic Community of West African States (ECOWAS) must accept laborers from neighboring ECOWAS states. While such laborers do exist within the Nigerien economy, this phenomenon is not common enough to cause friction and/or widespread resentment among local laborers.

According to Article 9 of Niger’s 2010 Labor Code, firms must hire Nigerien nationals via direct recruitment or through public or private hiring agencies. There are no restrictions on employers regarding hiring or laying off employees to respond to fluctuating market conditions. However, before making the decision, the employer must consult with the Inspector of Labor. An employee laid off for economic reasons receives, in addition to severance pay, a non-taxable allowance paid by the employer equal to one month’s gross salary.

Given both the need for foreign direct investment and the abundance of available labor within the country, labor laws are mostly modified, rather than waived to accommodate foreign firms. Many large foreign firms, including Orano (previously Areva), Orange and CNPC, are allowed to bring workers into the country provided that Nigerien laborers make up a substantial percentage of the overall workforce. As a member of ECOWAS, Niger routinely accepts labor from other member states, as obligated.

Freedom of association and the right to collective bargaining are generally respected and workers routinely exercise them. Unions have exercised the right to bargain collectively for wages above the legal minimum in the formal sectors and for more favorable working conditions.

Niger’s labor code, adopted in September 2012, regulates employment, vocational training, remuneration, collective bargaining, labor representation, and labor disputes. The code also establishes the Consultative Commission for Labor and Employment, the Labor Court and regulates the Technical Consultative Committee for Occupational Safety and Health.

The Labor Code lays out clear procedures for dispute resolution mechanisms in its Title VII on labor disputes. Labor hearings are public except at the reconciliation stage.

Although strikes are routine and common, most stem from non-payment of salaries and unsatisfactory working conditions existing within the public sector. Such strikes do not pose an investment risk.

Although Niger has ratified the International Labor Organization (ILO) Convention 182 on the Worst Forms of Child Labor and the ILO Convention 138 on the minimum age for employment, traditional caste-based servitude is still practiced in some parts of the country. In addition, child labor remains a problem particularly in the agricultural sector and the commercial and artisanal mining sectors. Gender discrimination is quite common within all workplaces.

There were no labor related laws or regulation enacted during the last year. The Labor Code adopted in September 2012 remains the most recent legislation related to labor.

The United States does not have a trade agreement with Niger.

							12. OPIC and Other Investment Insurance Programs					

Niger is eligible for OPIC coverage, but to date, OPIC has not been involved in any bilateral investments in Niger.

							13. Foreign Direct Investment and Foreign Portfolio Investment Statistics					

*Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy*

*Sources:

- National Institute of Statistics of Niger,  http://www.stat-niger.org/statistique/file/Annuaires_Statistiques/Annuaire_Statistique_2012-2016.pdf 
- The Average exchange rate of major currencies in 2016 is from West Africa Central Bank,  https://www.bceao.int/fr/ 

*Table 3: Sources and Destination of FDI*

Data not available.

*Table 4: Sources of Portfolio Investment*

Data not available.

							14. Contact for More Information					

Mr. Boubacar Gaoh MohamedEconomic and Commercial AssistantBP 11201, Niamey, Niger+227-20-72-26-61 extension 4443+227 99-49-90-76BoubacarGaohM@State.gov

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### On This Page

                    -  Executive Summary 
                    -  1. Openness To, and Restrictions Upon, Foreign Investment   
                    -  2. Bilateral Investment Agreements and Taxation Treaties   
                    -  3. Legal Regime   
                    -  4. Industrial Policies   
                    -  5. Protection of Property Rights   
                    -  6. Financial Sector   
                    -  7. State-Owned Enterprises   
                    -  8. Responsible Business Conduct   
                    -  9. Corruption   
                    -  10. Political and Security Environment   
                    -  11. Labor Policies and Practices   
                    -  12. OPIC and Other Investment Insurance Programs   
                    -  13. Foreign Direct Investment and Foreign Portfolio Investment Statistics   
                    -  14. Contact for More Information   

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