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WAEMU Market: Niger, Again, Defaults on Financial Obligations Amid WAEMU Sanctions

Monday, 18 September 2023 18:19
WAEMU Market: Niger, Again, Defaults on Financial Obligations Amid WAEMU Sanctions

(Ecofin Agency) - For the fifth consecutive time, since July 2023, Niger has defaulted on its financial obligations on the West African Economic and Monetary Union (WAMU) stock market. The country, which has been hit with sanctions from the Union following the recent coup, had planned to raise CFA830 billion on this market this year.

Niger missed another repayment on the WAEMU market last week, making it the fifth time since July when the country was barred from transacting with the rest of UEMOA, and had the BCEAO freeze its assets as well. According to the WAEMU market, the missing payments stand at CFA37.56 billion.

Niger first defaulted on July 31, 2023, shortly after General Tiani took over the country with a coup. The country failed to meet the interest on 5-year Treasury bonds issued on July 28, 2022, and 10-year Treasury bonds issued in July 2022, totaling CFA2.341 billion. The country again defaulted on August 11, on 12-month Treasury bills issued on August 12, 2022, due for CFA12 billion.

The third default occurred on September 4. Niamey was unable to settle its interest for 10-year Treasury bonds issued two days before; the corresponding sum was CFA1.719 billion. This was followed by another payment default on September 8, involving 12-month Treasury bills issued the same day. Here, the amount to be repaid was CFA21.5 billion.

Following the coup that took place on July 26, the WAEMU hit Niger with severe sanctions. These included the closure of air and land borders, freezing of the government's financial and monetary assets, and halting financial transactions between the country's banks and those in the other WAEMU States. 

Though the WAEMU Securities Agency said it would “take all the necessary steps to ensure the proper functioning of the Public Securities Market”, Niger’s ostracization from the regional financial market affects its economy, significantly. The isolation, indeed, makes debt refinancing more challenging, as the country heavily relied on this market to plug its financing needs.

Adding to the sanctions from UEMOA and ECOWAS, Moody's downgraded the country's sovereign rating from B3 to Caa2 on August 4.

All these factors distance Niger from its goal of raising CFA830 billion on the WAEMU market this year. Before it was hit by sanctions, Niamey had secured CFA522 billion on the regional market since the year began.

Fiacre E. Kakpo



Public Management

ECOFIN AGENCY offers a selection of articles translated from AGENCE ECOFIN. Founded in 2011, Agence Ecofin is a leader in Francophone Pan-African economic news, particularly in West and Central Africa. The agency publishes daily news on nine African economic sectors: Public Management, Finance, ICT, Agribusiness, Energy, Mining, Transport & Logistics, Communication, and Training.

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