Statement by Jorgen Varder at the Board meeting of November 11, 1997

International Bank for Reconstruction and Development 86893 International Development Association International Finance Corporation Multilateral Investment Guarantee Agency FOR OFFICIAL USE ONLY CONFIDENTIAL EDS97-410 November 10, 1997 Board Meeting of November 11, 1997 Statement by Jorgen Varder Niger - Country Assistance Strategy We concur with the analysis in the CAS, of the economic and social situation in Niger. Improved economic performance in 1996 and 1997, is much welcomed and needed, but in order to become sustainable, the economy of the country needs to be reinforced. We agree that the main problems exacerbating poverty in Niger are linked to poor soils, fluctuations in rainfall, human resource limitations, and a rapidly growing population. We find that the three-pronged approach of the CAS, to some extent, addresses these problems. However, in view of the fundamental character of the problems, as identified in the CAS, we find that it is essential to obtain a stronger commitment from GoN to counter the main impediments to sustainable development. The negative side effects of strict financial and economic policies should not be disregarded and attention should be paid to reducing such effects. During the Executive Directors’ group travel to Niger in March 1997, the Bank was widely criticized for causing suffering through its support for economic adjustment. Despite the criticism, there was a great interest in learning how the Bank could provide measures to relieve the social consequences of reform. The cut by several thousands, in the number of public employees, and the cut by 30 percent in public wages, may lay the foundation for an increase in corruption and political unrest. Integration of educated and trained former civil servants into private sector activities, should be encouraged and supported. In order to continue a positive economic and social development, the Nordic-Baltic countries find it important that there is progress in developments in the political field and regarding human rights -- particularly in light of the potential for political instability, resulting from lack of social improvement. The municipal election in early 1998, will be an important indication of the popular support for the Government’s policy and the population’s interaction with Government, which warrants close monitoring. We support the proposed policy regarding human capital development, and in particular, with emphasis placed on enhancing the possibilities for women in rural areas. The electronic version of the document is provided for convenience. (The official record is the version printed by the Corporate Secretariat). This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without the consent of the Executive Director concerned.  2 We find that the Bank has a major role to play in focusing the attention of the Government and the Nigerien society on crucial issues such as education and population growth control. Both are issues that need to be addressed as matters of priority. A dialogue should be initiated with Niger, on concrete measures to increase the level of education, for instance, by some degree of compulsory education. Special attention would simultaneously have to address the problem of teacher and education shortfalls. A dialogue with GoN on concrete measures with regard to population growth, should also be initiated. As long as a population policy does not find widespread support, any substantial poverty alleviation is not likely to occur. It would be interesting to learn how the Bank intends to pursue this issue. The electronic version of the document is provided for convenience. (The official record is the version printed by the Corporate Secretariat). This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without the consent of the Executive Director concerned.