afrol News, 14 January - The government of Niger is following the international trend of privatising state-owned companies, but the difficult market situation in the extremely poor country attracts few serious investors, especially for the power company NIGELEC.

Nigerien Finance Minister Ali Badjo Gamatié in a so-called 'Letter of Intent' to the International Monetary Fund (IMF) assures of his government good intentions of following the IMF's privatisation strategy to improve the country's financial situation. He however can report few successes.

The privatisation of the state-owned power company, NIGELEC, according to Mr Gamatié, was "hindered by an unfavourable international environment and the questioning of the adopted strategy by the two potential investors."

Potential investors in particular had indicated that they did not wish to fully finance the investment programme associated with the privatisation - US$ 100 million for restoring and expanding the network - a necessity for the Nigerien government to assure the future of key infrastructure in the country and thereby its development.

Giving into the demands of foreign potential investors, the Niamey government arranged a second launching of pre-qualification announcements in November 2002, which permitted the two operators to register their previously expressed demands. There has been no result in the privatisation process of NIGELEC so far.

According to Minister Gamatié, an interministeral committee responsible for monitoring the privatisation has been installed and is now holding talks with the World Bank on a new privatisation scheme involving the two candidates.

Finally, a draft decree on implementation of a new electricity code had also been finalised by the government to meet demands of potential investors, the Nigerien Minister assures the IMF.

Mr Gamatié however could report on an easier task regarding the Nigerien government's monopoly for petroleum product imports and distribution, SONIDEP. The proposed privatisation strategy of SONIDEP "transfers 51 percent of the capital, in batches, to the highest bidder in a field of professional, national, and international candidates."

With respect to the privatisation of Crédit du Niger (CDN), the Finance Minister says the government had "initiated talks with potential private shareholders, and a proposal regarding this transaction will be prepared and submitted for the Banking Commission's approval."

Niger, a landlocked Sahelian country of 11 million inhabitants, is plagued with extensive poverty. The population is largely involved in the agricultural and livestock sector and less than 20 percent of Nigeriens live in urban centres. Poverty, political instability and a lack of natural resources has contributed to very low foreign investments since independence in 1960.

By staff writer

© afrol News

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