FATF AML Deficiency List
Non - Compliance with FATF MER Recommendations
Corruption Index (Transparency International & W.G.I.)
World Governance Indicators (Average Score)
Weakness in Government Legislation to combat Money Laundering
Niger is not on the FATF List of Countries that have been identified as having strategic AML deficiencies
Compliance with FATF Recommendations
The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Niger was undertaken by the Financial Action Task Force (FATF) in 2008. According to that Evaluation, Niger was deemed Compliant for 2 and Largely Compliant for 5 of the FATF 40 + 9 Recommendations. It was Partially Compliant or Non-Compliant for all 6 of the Core Recommendations.
US Department of State Money Laundering assessment (INCSR)
Niger was deemed a ‘Monitored’ Jurisdiction by the US Department of State 2016 International Narcotics Control Strategy Report (INCSR). Key Findings from the report are as follows: -
Niger is one of the poorest and least developed countries in the world. Niger is not a regional financial center; its banking sector is rudimentary. It is a member of the Central Bank of West African States (BCEAO), and so shares its central bank and currency, the CFA Franc, with other countries in the region. High transaction costs deter businesses from placing large amounts of cash in the banking system. Most economic activity takes place in the informal, cash-based financial sector; and informal remitters and other money and value transfer services are widespread.
With porous borders and a large, under-governed territory, Niger provides an ideal transit point for various criminal organizations and terrorist groups. are commonplace in Niger. Illegal proceeds derive from trafficking of drugs, small arms, people, and everyday commodities across the Algerian and Libyan borders in the sparsely-populated north of the country. The regional smuggling of huge quantities of cigarettes across the Sahel is also very lucrative for traffickers in Niger. Cigarettes from counterfeit plants, mainly from Nigeria, are distributed in the region, the Maghreb, the Middle East, and Europe. Kidnapping for ransom is a significant fundraising method for terrorist groups. Other factors affecting security are the continuing rise in regional instability, including continued threats to security posed by al- Qaida and its affiliates, the Islamic State of Iraq and the Levant (ISIL), Malian jihadist groups, and the Nigeria-based terror group Boko Haram, which has attacked communities in Niger’s Diffa region on many occasions since the beginning of the year.
In October 2014, the National Assembly President Hama Amadou, a leading opposition figure, fled Niger to avoid being arrested on criminal charges. He returned to the country in November 2015 and was immediately arrested. As of November 2015, the political climate in Niger is contentious. Opposition groups have demonstrated to protest the continued detention of Amadou, a perceived failure of the state to provide basic services, and perceived restrictions on freedom of speech and expression. Meanwhile, national and local elections are scheduled to take place in February and May 2016, respectively.
There are no international sanctions currently in force against this country.
BRIBERY & CORRUPTION
Rating (100-Good / 0-Bad)
Transparency International Corruption Index 32
World Governance Indicator – Control of Corruption 32
Corruption represents a high risk for businesses in Niger, mostly due to low salaries and weak administrative controls. Corruption is especially rampant in the police and the judiciary, negatively impacting the administration of public services and land. The government of Mahamadou Issoufou has committed to actively address corruption and has made some progress in this regard. Despite high levels of corruption, surveys indicate trust in the government and its institutions. Nigerien anti-corruption legislation is weak, underdeveloped, and poorly enforced. Niger has accessed the United Nations Convention against Corruption and is on its way to aligning its legislation. For further information - GAN Integrity Business Anti-Corruption Portal
Niger is a landlocked, sub-Saharan nation, whose economy centres on subsistence crops, livestock, and some of the world's largest uranium deposits. Agriculture contributes nearly 40% of GDP and provides livelihood for most of the population. The UN ranked Niger as the least developed country in the world in 2015 due to multiple factors such as food insecurity, lack of industry, high population growth, a weak educational sector, and few prospects for work outside of subsistence farming and herding.
Since 2011 public debt has increased due to efforts to scale-up public investment, particularly that related to infrastructure. The government relies on foreign donor resources for a large portion of its fiscal budget. The economy in recent years has been hurt by terrorist activity and kidnappings near its uranium mines and by instability in Mali and in the Diffa region of the country; concerns about security have resulted in increased support from regional and international partners on defence. Low uranium prices, demographics, and security expenditures may continue to put pressure on the government’s finances.
Future growth may be sustained by exploitation of oil, gold, coal, and other mineral resources. Although Niger has sizable reserves of oil, the profitability of these commodities has been called in to question due to the prolonged drop in oil prices. Food insecurity and drought remain perennial problems for Niger, and the government plans to invest a little more in the agriculture sector, most notably irrigation. Niger’s three-year $131 million IMF Extended Credit Facility agreement for years 2012-15 was extended until the end of 2016, although formal private sector investment needed for economic diversification and growth remains a challenge, given the country’s limited domestic markets, access to credit, and competitiveness.
Agriculture - products:
cowpeas, cotton, peanuts, millet, sorghum, cassava (manioc, tapioca), rice; cattle, sheep, goats, camels, donkeys, horses, poultry
uranium mining, petroleum, cement, brick, soap, textiles, food processing, chemicals, slaughterhouses
Exports - commodities:
uranium ore, livestock, cowpeas, onions
Exports - partners:
France 53.1%, Nigeria 20.3%, China 13.8% (2015)
Imports - commodities:
foodstuffs, machinery, vehicles and parts, petroleum, cereals
Imports - partners:
France 12%, China 10.5%, Nigeria 9.5%, French Polynesia 9%, Togo 6.1%, Belgium 5.3%, Cote d’Ivoire 5.3%, US 4.3% (2015)
Investment Climate - US State Department
Niger is eager to attract foreign investment and has taken steps to improve its business climate, including making reforms to liberalize the economy, encourage privatization, and increase imports and exports.
The 2016 World Bank Doing Business report ranked Niger at 160 out of 189 economies surveyed. Niger has shown considerable improvement in the ease of starting a business/business registration category, and is ranked sixth out of eight within the West African Economic and Monetary Union (WAEMU) and 134th overall in this category. This reflects a jump of 43 places compared to the last report.
Niger has an operational center for mediation and arbitration of business disputes. The center’s aim is to maintain investor confidence by eliminating the long and expensive procedures traditionally involved in the resolution of business disputes.
Niger is ranked 99 out of 168 in Transparency International’s 2015 Corruption Perceptions Index. This demonstrates a remarkable improvement since 2011, when the country was ranked at 134.
In 2015, Niger strengthened minority investor protections by introducing disclosure requirements for related-party business transactions. These requirements allow shareholders to inspect documents pertaining to such transactions and to appoint auditors to conduct an inspection of these transactions.
In 2015, the National Assembly adopted a law creating the Commerce Tribunal, a specialized commercial court.
Historically, the mining and extraction sector has attracted significant investment and interest in Niger’s natural resources continues today. In 2011 Niger began producing oil; it joined the African Petroleum Producers Association (APPA) the following year.
Niger has successfully attracted foreign direct investment (FDI) outside of the mining and extraction sectors. For example, in 2012 Niger secured $78 million in FDI towards the construction of the new Malbaza cement factory. It also received $257 million in loans and multilateral donor aid for the construction of the Kandadji hydroelectric dam, which is expected to provide both irrigation and electricity, reducing Niger’s reliance on imported electricity from Nigeria.
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