Visit to Niger by a delegation from Luxembourg

©SIP / Jean-Christophe Verhaegen
Meeting of the Prime Minister, Minister of State, Xavier Bettel, and the Minister for Cooperation and Humanitarian Action, Franz Fayot, with the Prime Minister of the Republic of Niger

On 5 and 6 June Luxembourg’s Prime Minister Xavier Bettel and the Minister for Development Cooperation and Humanitarian Affairs Franz Fayot visited Niger to meet the authorities there to discuss access to basic services and financing for women, young people and agricultural sector stakeholders.

Partners historically committed to development
Relations between Luxembourg and Niger are not something new, as Niger has been one of the priority countries for Luxembourgian aid for over more than 30 years. Last March, Mr Fayot made a visit to Niger to sign the fourth Indicative Cooperation Programme (IPC) for the 2022-2026 period. The fifth element of the IPC on inclusive finance, with a budget of 15 million euros, had been entrusted to ADA for technical support, co-managed with the Luxembourg agency for Cooperation and Development (LuxDev) for financial support. The other four elements of the IPC will be implemented by LuxDev. Specifically, ADA will provide technical assistance to stakeholders in the inclusive finance sector to foster access to finance by vulnerable segments of the population, i.e. women, young people and stakeholders in agricultural value chains in rural areas, while LuxDev will undertake the implementation of the four other elements of the IPC.

The agricultural sector needs finance
The activities of banks and decentralised finance systems  (SFD) have traditionally focused on sectors with strong economic potential, to the detriment of other growth market sectors that find themselves out on the fringes. In particular, the agricultural sector has not found its place due to constraints not only linked to specific considerations related to credit (high production risk, market instability, lack of guarantees by farmers, etc.) but also to structural ones (lack of financial resources of banks and SFDs, high cost of credit due to high interest rates, charges etc.). Nevertheless, the financing needs of people in rural areas are clear, given the high percentage of the country’s population that earns a livelihood from agricultural and rural activities. It is, therefore, important to reconsider the low proportion of agricultural financing and help the financial entities and the authorities to propose affordable loans that are geared to the needs of the people working in the agricultural sector (individual producers, organisations of producers – cooperatives, associations – and groupings of women, young entrepreneurs in rural areas, etc.)

Support for the country’s institutions
Throughout the duration of the IPC, ADA will support the public institutions in Niger to develop inclusive finance, notably supporting the operationalisation of the Inclusive Finance Development Fund (French acronym: FDIF) launched by the Government of Niger in 2021 and later managed by the Executive Secretariat for the country’s National Strategy for Inclusive Finance (SE-SNFI).
ADA will also support the Investment Fund for Food and Nutritional Security (FISAN) by establishing partnerships with donors and technical support structures for the operationalisation of the agricultural credit financing mechanism for banks and SFDs.
ADA will also provide technical support to the SFDs that are partners in the FDIF.

Meetings organised by ADA
ADA, whose Head of the project supporting the development of inclusive finance is on the ground in Niamey, organised and then attended meetings between the delegation from Luxembourg, the authorities of Niger and the local technical support providers, with the aim of initiating a dialogue that is both political and involves technical and financial service providers. Meetings have also been organised with the national agency of the CBWAS (Central Bank of West African States), the APBEF (professional association of banks and financial establishments), the APSFD (professional association of decentralised financial systems) and the bureau of the association of digitisation directors.