Member States : Republic of Niger
Republic of Niger
Niger continued to experience relative peace and political stability having restored democratic rule and adopted political and institutional reforms in the preceding year. Yet, there are concerns that Niger’s significant nomadic Tuareg inhabitants, about 11% of the population, and difficult socioeconomic conditions could result in a spillover from a Tuareg rebellion and terrorism-related violence and insecurity from neighboring Mali. In response, the government unveiled a five-year development and security strategy with the aim of preventing Niger from descending into that kind of terrorism-related violence and insecurity that has gripped Mali163.
Niger is well ranked on the ‘Reporters without Borders’ press freedom indexof January 25, 2012. In Africa, Niger ranked 4th, behind Cape Verde (1st), Namibia (2nd) and Mali (3rd). The press in Niger faces tough economic challenges, but it is free and works in a favorable legal context. There have been almost no reports on violations and progress has been seen in both concrete and symbolic measures.
Yet, in spite of this commendable progress in democracy and constitutionalism, the entrenchment of terrorist groups in neighboring Mali and Nigeria in 2012 has considerably increased the vulnerability of the country to the risks of ML/TF. The infiltration of the pan-Touareg secessionist movement by jihadists and the increased intensity of organized crime across the borders from Mali and Nigeria have particularly heightened the vulnerability of Niger to organized crimes, the laundering of the proceeds of such crimes and terrorist financing operations.
Economic and Financial Situation
Following a series of external shocks – bad weather and minimal rain, as well as security problems in neighboring Nigeria and Cote d’Ivoire, which reduced economic growth from 8% in 2010 to 4.2% in 2011, the Nigerien economy was expected to grow by 11.2% in 2012 and 6% in 2013. The expected growth, lower than the 14.2% projected by the IMF, was attributed to significant investment in the mining and oil sectors.
The impressive growth, however, have not translated into broad-based prosperity. With the economy not producing many jobs, many young Nigeriens continue to struggle to find employment. Difficult living conditions remain widespread as anti-poverty efforts have yielded minimal results. Accordingly, Niger is unlikely to achieve all the MDGs, particularly halving poverty, by 2015.
Niger’s growth strategy is based on seven pillars, which include a major scale-up in public spending on infrastructure, agriculture, health and education, as well as measures to ward off the increasingly looming threats to security in the region and a comprehensive program to develop the financial and private sectors. The authorities are in the process of concluding the progress report on the poverty reduction strategy for the period from 2008 to 2012. They expect to also finalize a sustainable development and inclusive growth strategy – government’s new poverty reduction strategy – expected to be finalized by the end of 2012.
Whatever the outcomes of these development strategies, Niger will need to strengthen good governance in order to lift its population from poverty and reduce its vulnerability to the risks of ML/TF. It has the potential, with the discovery of petroleum oil in commercial quantities, in addition to its uranium to be a prosperous country if the exploitation and management of these mineral resources are well handled.
The Financial sector of Niger is dominated by 10 deposit money banks accounting for about 90% of the sector’s assets, which represents 12.74% of GDP in 2010. Remittances inflows in 2011 stood at USD102 million, representing about 1.7% of GDP.
Niger is the 2nd lowest country in the world on the Human Development Index (186th/187 countries). It faces a combination of crises (food crisis in 2011, severe flooding in 2012, and the security crises all around the country). The GNP per capita is about $399 and 43.1% of the population is living on less than $1.25 a day. The population, estimated at 15.5 million, is growing at a rate of 3.5% each year. UNDP reports that life expectancy in Niger is 54.7 years and mortality rate is 7.3%.
The country lacks a good business climate (173rd out of 183 countries in the Doing Business 2012 rankings). The disabling factors in the business environment include: corruption, inconsistency in some regulations and the way they are enforced, institutional deficiencies, and the lack of access to credit and land. Nevertheless, the last session of EITI’s international Board in March 2011 placed Niger among the countries deemed to be compliant with the Extractive Industries Transparency Initiative (EITI). Niger was still ranked poorly by Transparency International in 2012 with a score of 33/100 points (113rd /174 countries).
The social conditions in the country continued to be distressing. Progress has been made in improving the living conditions of the population, but this is yet to drive poverty down in a significant manner. To overcome this trend, Niger needs strong and sustainable growth of about 7% per year, coupled with population growth control.
The demand for labor in Niger is relatively weak, which shows that the economy has a low propensity to create jobs. This is a major obstacle to youth employment. In the same vein, about 40% of graduates do not match the job profiles employers need, because their qualifications are most often not tailored to suit job market requirements.
The UNDP Human Development Report states that the adult literacy rate was about 28.7% in 2011, that primary enrolment rate is on a rising trend, but that the education system still has deficiencies. In the field of education, the enrolment of girls in primary school has doubled since 2000, and yet, the gap between girls and boys keeps widening towards the end of primary schooling. With the level of poverty in Niger, the proportion of unemployed women further underlines the difficult conditions in which they live. Women’s presence in the public sphere and participation in government, parliament and public institutions have improved, thanks especially to the law that established a quota system. Unfortunately though, their weight in decision-making is still marginal.
Prevalence of Predicate Crimes
Niger is one of the countries in the Sahel region that is most affected by transnational organized crime, terrorism and terrorist financing. Its desert covering three-quarters of the country’s total area and 85% of the 15.5 million people is concentrated in a corridor that is barely 100-150 km wide between the northern border with Nigeria and the capital city (Niamey). This makes it difficult for the State to exercise effective security control across the entire territory, and this paves the way for the emergence of various forms of organized crimes and terrorism. According to the U.S. State Department, drug traffickers pass through Mauritania, the northern regions of Mali and Niger and along the Algerian and Libyan borders to reach North Africa before moving towards the Middle East and Europe. The drugs they carry are mainly from South America. This is compounded further by the wide availability of weapons in the Sahel region since the end of the Libyan conflict, which enables traffickers to strengthen their ability to deliver their illicit products.
While Niger is not known to be a drug producing/ consuming country (except for small quantities of cannabis and synthetic drugs), it reports regular seizures of an impressive amount of drugs because of the international drug trafficking trade. It is in this regard that on the International Day against Drug Abuse and Illicit Trafficking, which was commemorated on 26 June 2012, a drug incineration ceremony was organized in Niger under the auspices of the Minister of Justice, Keeper of the Seals, to eliminate a large amount of the drugs seized.
In addition to drug and weapons trafficking, the smuggling of huge quantities of cigarettes across the Sahel is also very lucrative for traffickers in the region (in Niger). Cigarettes from counterfeit plants, mainly from Nigeria, are distributed in the region, in the Maghreb, in the Middle East and in Europe. This trafficking is a major source of funding for terrorist groups. While the groups may not always or necessarily be involved directly in this kind of smuggling, they charge the smugglers to pay for their protection as ‘bodyguards’. In addition to the cross-border trafficking in the Sahel-Saharan region, Niger is increasingly facing the terrorist threat posed by Al Qaeda in the Islamic Maghreb (AQIM). This is evidenced by the kidnappings perpetrated by AQIM and the activities of Boko Haram in Nigeria. The U.S. Drug Enforcement Agency (DEA) reports there are 60% of foreign terrorist groups involved in drug trafficking, and this could exacerbate the crime level in the country. The prevailing predicate crimes include illegal fuel trafficking, cigarette smuggling, trafficking of various goods in transit, forgery and the use of forged documents, bribery, tax evasion, illicit enrichment, influence peddling, and the misappropriation of public funds.
Considering how Niger had recurrently failed to report significant progress in developing the national AML/CFT system up to international standard, GIABA’s Technical Commission placed the country under an enhanced monitoring regime in November 2011. GIABA also embarked on an advocacy visit to the country’s highest authorities from 24 to 26 April 2012, urging them to improve their AML/ CFT regime. GIABA’s initiative seems to have yielded fruit, looking at the progress observed in Niger’s 4th Follow-Up Report that was submitted to the GIABA Technical Commission in November 2012. Indeed, it shows there is a new impetus in anti-money laundering and counter terrorist financing efforts in the country. It mentions especially that the national authorities are playing an active role in ensuring the effective control of corruption and related offences.
Niger has subsequently established the Haute Autorité de Lutte contre la Corruption et les Infractions Assimilées (HALCIA). Since it did so, several high-profile persons have been interrogated and put through detention hearings for allegedly smuggling goods. The Justice Ministry has also set up a hotline to give all citizens the opportunity to report cases of corruption. In the same vein, eight (08) complaints have been lodged for Parliament to lift the parliamentary immunity of MPs facing corruption charges. On counter terrorist financing, a central service has been established at the General Directorate for Territorial Surveillance. Likewise, a terrorism prevention and counter terrorist financing unit has been put in place within the judicial system by order of law. On national cooperation, Niger has revived the National Counter Terrorism Committee at the Ministry of Foreign Affairs (Decree Nr. 022/MAEC/ DAAF/DP of 25/10/2007, amended by Order Nr. 03/MAEC/IA/ NE/DIRCAB of 2/21/2012), which was initially set up in 2010. The committee’s structure has been modified to cover the FIU and BCEAO, making it an exchange forum on the operational aspects of counter terrorism.
On AML/CFT specifically, Niger’s CFT law is compliant with the WAEMU Community law. The FIU now enjoys better working conditions. It has more money, appropriate work premises and equipment, and stipends for its workers. The rules and regulations of the FIU have been revised to strengthen its structure. The Unit now has a financial analyst sponsored by GIABA to process Suspicious Transaction Reports (STRs). In 2012, the FIU received seven (07) STRs. Of these, five (05) were processed and referred to the Public Prosecutor. The FIU also conducted four (4) administrative seizures to investigate cases of money laundering and/or terrorist financing. In terms of cooperation with other FIUs, the FIU signed an agreement with the Ghana FIC in February 2012. It also signed an agreement with the Gabon FIU in March 2012.
In addition, the FIU embarked on study tour to some foreign FIUs to learn best practices. These include: TRACFIN (France), CTIF (Belgium), the Senegal FIU, the Côte d’Ivoire FIU, and Ghana’s FIC. It also organized working sessions with the GIABA Secretariat and UNODC at their respective offices in Senegal. Similarly, it held meetings with technical and financial partners in Niger to present its work program and seek technical assistance from them (the United States Consulate, the Embassy of France, the Embassy of China, the European Union Delegation, the Coordinator of the EU Unit at the Ministry of Finance, and the Embassy of the United States).
Niger’s Justice Minister officially inaugurated the AML/CFT National Coordination Committee on April 5, 2012 in the presence of GIABA’s Representative. The Committee, in June 2012, organized a workshop for its members to train them on the AML/CFT national strategy. After this workshop, the committee approved Niger’s AML/CFT Country Strategy Paper, and it is now in the process of being adopted by the public authorities.
GIABA recruited a financial analyst for the FIU of Niger for one year in the first instance. GIABA also sponsored newly appointed members of the FIU to a study tour to Belgium to learn some best practices. Nevertheless, it is crucial to take account of the country’s organized crime situation in determining its technical assistance needs, and these would include:
- Restoring confidence of banks and other reporting entities in the confidentiality of the reports they make to encourage them do more;
- Training programs to include all the subject persons, especially reporting entities;
- Conducting specific training exercises for the investigation and prosecution authorities;
- Organizing a consultative meeting on manual currency exchange issues;
- Raising the awareness of local communities;
- Providing the FIU with top-quality technical materials: installing the application for processing STRs, procuring a Database Server, a Back-up Server and a Mail Server, providing training in the use of the STR database, and training the financial analyst at the FIU;
- Organizing an International Forum on the Financing of Terrorism; and
- Organizing study trips and facilitating cooperation arrangements with the FIUs of Chad, Nigeria, Cameroon, France and Belgium.
Niger suffers geopolitical instability and has porous borders that facilitate the transfer of weapons from one country to another, strengthening the position of terrorists and drug traffickers. It is in this context that the country became attractive or transit point for the proliferation of weapons, trafficking of drugs, and the smuggling of cigarettes and other illicit substances. Considering the magnitude of the challenge, all social groups need to work together to tackle organized crime in an effective manner. This primarily involves the security services (police, gendarmerie and customs), as well as the judges and AML/CFT entities. The crime situation makes the country particularly vulnerable to money laundering and terrorist financing offences. Therefore, Niger must sustain its momentum for compliance with international standards. This entails the proper implementation of the recommendations in its Mutual Evaluation Report, especially putting in place a proper mechanism for the freezing and confiscation of proceeds of crime in accordance with the UNSCRs 1267 and 1373. It must also provide sufficient and secured office accommodation to its CENTIF to be able to take advantage of the GIABA AML/ CFT analytical hard and software and begin the process of applying for membership of the Egmont Group.