Tag Archives: finance law

Niger – Battle for the budget

Who would have thought a finance law could ignite such fervor, bringing thousands to the streets of Niamey and other cities of Niger in demonstrations for and against the national budget?

Since October 2017, a coalition of civil society groups, opposition parties and labor unions have mobilized against Niger’s 2018 budget law which they label as “antisocial.” The 2018 budget extends taxation into the informal sector, including the transportation sector, and raises taxes on the trade and service sectors, among other measures. It also provides for reduced taxation of the mobile sector, notably by eliminating the tax on incoming international calls (TATTIE), which was a significant source of revenue (about 20 billion FCFA). The government of Niger was reportedly under pressure by the international mobile phone companies and the World Bank to eliminate the TATTIE which according to Minister of Finance Hassoumi Massaoudou is not applied in any other country member of the West African Economic and Monetary Union.

The finance law was adopted in November 2017 without changes proposed by the opposition. Since then, there have been regular demonstrations against the 2018 budget, which have continued into 2018. Protesters argue the law affects the poor disproportionately, while favoring foreign firms.

In early March, pro-government parties organized a massive counter demonstration in support of the budget and President Mahamadou Issoufou. The government argues the tax burden remains at its 2015-level and that the budget has no negative impact on the rural sector where 80% of Nigeriens live. Instead, according to the Minister of Finance, the 2018 budget seeks to extend taxation to the large informal sector in the urban areas that amounts for 59% of GDP.

This budget battle is a product of and illustrates the significant external and internal pressures the government of Niger is facing.

Insecurity is an existential threat, with terrorists infiltrating and attacking the country from neighboring Mali, Libya and Nigeria. Just this past week, three armed police officers (gendarmes) were killed in Goubé, at 40 km from the capital Niamey, by assailants crossing over the border from Mali.

As a result of the regional insecurity, 15% of the national budget now goes to the security sector, while spending on public services such as education and access to clean water has had to be reduced proportionally. Falling prices on uranium and oil, Niger’s primary exports, have contributed to the country’s significant dependence on foreign aid which in turn limits the government’s policy options.

At the same time, the government of President Issoufou faces a very determined opposition led by the largest opposition party, MODEN/FA Lumana. Lumana’s leader, former Prime Minister and former Speaker of the National Assembly Hama Amadou, is in self-imposed exile in France after being sentenced in absentia to a year in prison for child smuggling – a charge Hama Amadou and his supporters argue is politically motivated. The opposition is boycotting the newly reformed independent election commission where it has refused to take up the seats reserved for it. The opposition also stays away from meetings of the National Council for Political Dialogue (Conseil National pour le Dialogue Politique – CNDP), a forum under the auspices of the prime minister created to facilitate inter-party dialogue outside of parliament. Instead, as we’ve seen, the opposition is taking to the streets, forming an alliance with some of the largest civil society organizations of Niger.

In a country with a rich history of military coups – the latest as recent as 2010 – and facing significant security threats, there is reason to worry about the apparent inability of government and opposition to engage in dialogue. In early March, after the pro-government counter demonstration, the Islamic Associations of Niger felt compelled to issue a statement condemning the marches for or against the 2018 finance law and calling on Nigerien elites to come together “to protect the sovereignty of the nation, social cohesion and to ensure sustainable development.” They also declared their availability to serve as mediators. The statement may have contributed to the civil society-opposition coalition calling off its plans for the organization of a “ghost town operation” (general strike) on March 15. However, the protesters against the finance law have maintained their call for a large manifestation on March 25.

The situation in Niger merits greater attention than the country generally gets. An apparently banal budget battle could well degenerate. The use of the streets to demonstrate political muscle illustrates how polarized the situation is, and the inability of existing institutional fora to appropriately channel political dialogue.