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Niger
Impacts of COVID-19 on Production,
Poverty & Food Systems
Disclaimer: The analysis presented in this slide deck are the authors’ own
and do not necessarily reflect the view of the authors’ institutions.
Financial support from
Karl Pauw1, Josée Randriamamonjy1, Alkassoum Sangaré Saadatou2, and James Thurlow1
1 International Food Policy Research Institute
2 Cellule d’Analyse des Politiques Publiques et d’Evaluation de l’Action Gouvernementale (CAPEG)
Updated: 2 December 2020
Contact: Josée Randriamamonjy (J.Randriamamonjy@cgiar.org)
Updated: Dec 2 2020
Curfew Imposes Significant Economic Costs
• National GDP is estimated to fall by
12% during curfew period
(US$ 203 mil. in lost GDP)
• Food system is adversely affected by
falling consumer & export demand
(6% agri-food GDP decline, despite exemptions)
• Poverty rate increases by 6
percentage points during the curfew
period
(1.5 million more people temporarily living below the
national poverty line)
Source: Niger SAM Multiplier Results
Economic impacts during
curfew period
12.1
5.9
6.2
Percentage decline in
national GDP
Percentage decline in
agri-food system GDP
Percentage point
increase in national
poverty rate
2.0
1.5
Decline in national
GDP in US$ 100
millions
Increase in number
of poor people in
millions
Updated: Dec 2 2020
Costs Likely to Persist Throughout 2020
• Economy is reopening & some
restrictions are eased
• But economic losses remain,
even with a fast recovery
(GDP may be 5.0-5.8% lower in 2020;
losses extend into 2021, but likely to be
minimal compared to a no-COVID
scenario)
• Average GDP & poverty rates
for 2020 hide sharp mid-year
deteriorations
(some businesses & people will require
government support to cope & recover)
Change
in quarterly
GDP
Change
in national
poverty rate
(national poverty
line)
Quarterly national impacts under faster or
slower easing recovery
(changes are relative to a no-COVID scenario)
-0.3%
-10.8%
-6.6%
-2.3%
-5.0%
-0.2%
-0.3%
-12.1%
-7.5%
-3.5%
-5.8%
-0.8%
Q1 Q2 Q3 Q4 2020 2021
2020 Annual
Faster recovery Slower recovery
0.2%
5.2%
3.1%
1.5%
2.5%
0.1%
0.2%
6.2%
3.4%
1.8%
2.9%
0.5%
Q1 Q2 Q3 Q4 2020 2021
2020 Annual
Updated: Dec 2 2020
COVID-19 Outbreak &
Restriction Policies in Niger1
Updated: Dec 2 2020
-10
0
10
20
30
40
50
60
70
80
13-Mar
20-Mar
27-Mar
3-Apr
10-Apr
17-Apr
24-Apr
1-May
8-May
15-May
22-May
29-May
5-Jun
12-Jun
19-Jun
26-Jun
3-Jul
10-Jul
17-Jul
24-Jul
31-Jul
7-Aug
14-Aug
21-Aug
28-Aug
4-Sep
11-Sep
18-Sep
25-Sep
2-Oct
9-Oct
16-Oct
Confirmednewcases
COVID-19 Cases & Policy Timeline
First confirmed
case in Niger
Cancellation of international meetings due to take
place in Niamey (Francophonie and OIC) 03/13
- Curfew in Niamey, the Capital, declared
from 7 pm to 6 am 03/28
- Quarantine in Niamey declared for two
weeks
- Public health emergency announced
- Lifting of curfew and quarantine in Niamey 05/13
- Reopening of places of worship
- Release of inter-urban passenger transportation
Extension of state of emergency for an
additional 3 months in Diffa and in several
departments of the Tillaberi and Tahoua
regions 06/15
- Closure of bars, nightclubs and others
entertainment centers 03/ 20
- Recommendations to follow good hygiene
practices and social distancing protocols
- Ban on public gatherings of more than 50
people
- Prohibition of collective prayers, closure of
places of worship and ban on religious
gatherings
- Closure of schools and universities
- Closure of land borders (except for goods)
- Closure of Niamey and Zinder international
airports (except for domestic, cargo, health
and military flights)
- Closure of bus stations and suspension of
public transportation
- Reinstatement of normal working hours, i.e. from 8 am to
5.30 pm, from Monday to Thursday and from 8 am to 1 pm
on Fridays; lifting of the reduction of staff 05/25
- Suspension of the ban on workshops and seminars
- Reopening of school 06/01
Niger never imposed a strict lockdown of
business, instead opting for a curfew from
March 28th to May 13th, combined with work
from home and reduced working hours,
school closures, domestic and international
travel restrictions, and social distancing
measures.
Extension of state of emergency in Tillabéri and
Gotheye departments 06/22
Air border closure lifted but
land borders remain closed
Updated: Dec 2 2020
Sectors Affected by COVID-19 & Restrictions (1)
Sector Restrictions or exemptions during national curfew period Directly Affected?
Agriculture
Despite deficits from last growing season, agricultural production expected to
resume due to favorable rainfall levels in 2020. Sector is exempted from direct
COVID restrictions. Possible benefits from favorable weather not analyzed.
None
Mining
Extraction of crude petroleum and natural gas expected to decline 11% in 2020 as
a result of supply chain disruptions Some
Manufacturing
Direct effect of cross-border intermediate input flows from Nigeria, Burkina Faso,
Benin, Togo, Ghana and Côte d’Ivoire (land borders still closed). Not included high
transaction costs caused by measures imposed in supplier countries.
Some (high for
pharmaceutical,
chemical, wood
products)
Utilities Electricity & water distribution exempt (essential sector) None
Construction
No direct effect of curfew anticipated for public or private construction (imposed
from 7pm to 6am) None
Wholesale & retail
trade services
Border closures affect availability and domestic trade of imported goods (imports
from UEMOA account for 54% of imports from Africa) Some
Transportation,
storage & cargo
Land borders closed to passenger vehicle traffic; cargo and freight exempt. Ban on
urban transport at night. Suspension of all commercial passenger air travel High
Hotels & food
services
Hotels closures and/or significantly reduced patronage. Closure of night clubs,
bars, and restaurants High
Updated: Dec 2 2020
Sectors Affected by COVID-19 & Restrictions (2)
Sector Restrictions or exemptions during national curfew period Directly Affected?
Banking, finance &
insurance
Direct effect of reduced working hours in formal service sectors anticipated for
banking, finance and insurance sector Some
Professional &
business services
No direct effect of curfew anticipated for banking, finance and insurance sector,
although work-from-home measures, job layoffs, and social distancing have some
impact on supply or demand
Some
Public admin &
law enforcement
Reduced working hours in public sectors (added to difficult adjustment to work-
from-home measures) High
Education services All public schools closed mid-March to early June; limited scope for online delivery Some
Health services Health services exempt (essential service) None
Sports &
entertainment
Sports, religious, cultural and political gatherings suspended mid-March to mid-
September Some
Updated: Dec 2 2020
Sectors Affected by COVID-19 & Restrictions (3)
Sector Nationwide Directly Affected?
Export demand
Closure of the border with Nigeria affects uranium exports (-9%) - losses
cushioned by rising uranium prices (12%) Some
Remittances Declines in the value of remittances sent by citizens working abroad Some
Foreign direct
investments
Falling foreign direct investment in machinery, equipment, vehicles, and
construction activities
Some
See detailed sector-level assumptions about production &
demand shocks in Annex at the end of slide deck
Updated: Dec 2 2020
Measuring Economic Impacts2
Updated: Dec 2 2020
Economywide Multiplier Analysis
• Lockdown policies & other shocks have direct impacts on the
operation of certain sectors
(e.g., closing schools, banning sports events, restricting travel, etc.)
• But they also generate indirect impacts on other sectors involved
in supply chains
(i.e., input suppliers & downstream users)
• Multiplier analysis uses sector input-output data to measure
direct & indirect impacts throughout & across supply chains
(incl. impacts on GDP, jobs & household incomes)
• Niger model based on 2018 SAM & 2014 household survey data
(results scaled to 2019 GDP & employment levels)
Updated: Dec 2 2020
Economywide
Impacts
GDP | Jobs
Incomes | Poverty
Direct
impacts
Framework for Analyzing COVID-19
GlobalImpact Channels
(Due to partial or full lockdowns in other countries)
Indirect
impacts
DomesticImpact Channels
(Due to partial or full lockdowns in own country)
• Export demand
• Remittances & migration
• Foreign direct investments
• Agriculture
• Mining & crude oil
• Manufacturing
• Utilities (energy, water)
• Construction
• Whole & retail trade services
• Transportation, storage & cargo
• Hotels & food services
• Banking, finance & insurance
• Professional & business services
• Public administration & law enforcement
• Education services
• Health & social services
• Sports & entertainment
• Community & other services
Updated: Dec 2 2020
Impact Channels & Shocks
• Restrictions during curfew period are simulated using a range of
impact channels
• Shocks to each channel are imposed on the model & impacts are
simultaneously traced across all supply chains
• Multiplier model separates Niger economy into 86 sectors
(shocks are calculated bottom-up using supply-use data for 136 goods &
services)
• Size of shocks is estimated by IFPRI’s staff & collaborators
(see Annex)
Updated: Dec 2 2020
Curfew Period & Recovery Scenarios
Q1-2020 Q2-2020 Q3-2020 Q4-2020
Curfewimposed
Minimaleasingof
restrictionsrestofQ2
1
2
1. Impacts during curfew period only
• Six-week period during which curfew is imposed and social distancing measures are
most stringent
• Shocks assumed to be imposed nationwide
2. Impacts for rest of 2020 and 2021 as restrictions are lifted
• We will compare a faster vs. slower easing of restrictions over two years, although most
restrictions are fully lifted by the end of 2020
• Analysis accounts for intra-annual seasonality
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Q1-2021 Q2-2021 Q3-2021 Q4-2021
Further
easing of
restrictions
in Q3
2020
Apart from significant decline in tourism and hotel due to
closures of land borders, minimal impacts remain in the rest of
the economy as it returns to full production by end of Q4 2021
Most
restrictions
lifted by end
of Q4
2020
Updated: Dec 2 2020
Economic Impacts During
Curfew3
Updated: Dec 2 2020
GDP Losses During Curfew
National GDP drops 12% during curfew
(economic losses largest in the services sectors, in
both relative and absolute terms)
Source: Niger SAM Multiplier Results
Change in total GDP during curfew
period (%)
Change in total GDP during curfew
period (US$ mil.)
-12.1%
-4.1%
-16.2%
-17.6%
Total Agriculture Industry Services
-$203.3
-$26.1
-$61.4
-$115.8
Total Agriculture Industry Services
Updated: Dec 2 2020
33.7%
18.1%
10.1%
6.3%
6.2%
6.2%
5.6%
4.9%
3.3%
2.8%
2.3%
0.5%
Passenger & other transport restrictions
Reduced hotel & restaurant patronage
Shocks to foreign direct investment
Restrictions on business services
Uranium export shocks
Reduced crude oil extraction
Disruption to input supply chains
School closures
Shocks to foreign remittances
Other services
Constrained wholesale & retail trade
Government work from home
Sources of GDP Losses
Transport and hospitality restrictions account for half of GDP losses
Contribution of restrictions & shocks to loss in total
GDP during curfew period (sums to 100%)
(significant contribution of shocks to foreign direct investment)
Hotel and restaurant
restrictions have knock-
on impacts on agriculture
and food supply
Source: Niger SAM Multiplier Results
Loss due to passenger transport
restrictions and reduced transport
demand caused by economic
slowdown
Impact of foreign investment
restrictions on large investment
including infrastructure
construction
Updated: Dec 2 2020
-5.9%
-4.1%
-13.6%
-7.2%
-38.5%
Agri-food system (47.7%)
Agriculture (38.6%)
Agro-processing (2.0%)
Food trade and transport (5.9%)
Food services (1.3%)
-$46.5
-$26.1
-$5.0
-$7.0
-$8.3
Agri-food system (51.2%)
Agriculture (40.7%)
Agro-processing (4.3%)
Food trade and transport (5.6%)
Food services (0.5%)
Impacts on the Agri-Food System
Food supply is exempt from most restrictions, but it is still
indirectly affected by falling consumer incomes & other shocks
Change in agri-food GDP
during curfew period (%)
Change in agri-food GDP during
curfew period (US$ mil.)
(food services is directly affected by the closing of hotels, restaurants & bars,
but this is a small component of the overall agri-food system)
Source: Niger SAM Multiplier Results
Share of
total GDP in
2018 (%)
Updated: Dec 2 2020
53.8%
13.7%
9.6%
7.7%
7.7%
1.9%
1.6%
1.4%
1.1%
0.8%
0.5%
0.1%
Reduced hotel & restaurant patronage
Passenger & other transport restrictions
Shocks to foreign remittances
Disruption to input supply chains
Shocks to foreign direct investment
Uranium export shocks
Restrictions on business services
School closures
Reduced crude oil extraction
Other services
Constrained wholesale & retail trade
Government work from home
Sources of Agri-Food System GDP Losses
Hotel and restaurant restrictions contribute most to agri-food GDP
losses via its significant indirect impact on food supply
Contribution of restrictions & shocks to loss in agri-
food GDP during curfew period (sums to 100%)
(effect of transport restrictions is also significant)
Foreign remittances account
for almost 2% of household
incomes in Niger
Source: Niger SAM Multiplier Results
Transport disruptions to food
supply chains
Significant knock-on effects on food
supply chains in addition to direct
effects on hospitality industry
Updated: Dec 2 2020
-4.1%
-1.9%
-2.5%
-1.1%
-0.4%
-0.8%
-6.4%
-9.6%
-8.8%
-10.7%
-1.1%
-10.6%
-8.6%
Agriculture
Crops
Cereals
Pulses & oilseeds
Root crops
Fruits & vegetables
Sugarcane
Export crops
Livestock
Meat & eggs
Dairy
Forestry
Fishing
Unpacking Agricultural GDP Impacts
Cereal crops are the largest food
group and agric. subsector in
Niger
Livestock sector affected by
decline in restaurant
demand for meat
Share of agric. GDP
in 2018 (%)
(69.6%)
(10.7%)
(1.0%)
(18.8%)
(0.3%)
(0.6%)
(20.6%)
(16.6%)
(4.0%)
(6.6%)
(3.3%)
Source: Niger SAM Multiplier Results
(38.3%)
Change in GDP during
curfew period (%)
Falling FDI reduces
construction and demand
for wood inputs
Large percentage losses in
small agricultural sectors
Updated: Dec 2 2020
-7.8%
-5.3%
-5.4%
-5.3%
-9.0%
-10.0%
-5.6%
-9.7%
-10.4%
-21.7%
Food processing
Meat
Fish
Dairy
Fruits & vegetables
Fats & oils
Cereal milling
Sugar refining
Other food
Beverages and tobacco
Unpacking Agricultural GDP Impacts
Change in GDP during
curfew period (%)
Source: Niger SAM Multiplier Results
Note: Agri-food processing is a subsector within manufacturing
Urban and higher-income households who
are the most affected are also the main
consumers of beverage and tobacco and
processed food
Updated: Dec 2 2020
Impacts on Household Incomes
Source: Niger SAM Multiplier Results
Change in household incomes during curfew period (%)
All households experience large income losses
(larger income losses for urban and higher-income households who are more likely
employed in sectors affected more directly by restrictions)
-12.0%
-8.5%
-12.7%
-9.3%
-8.4%
-15.2%
-16.3%
All households Quintiles 1-2 Quintiles 3-5 Rural Rural Farm Rural Nonfarm Urban
Updated: Dec 2 2020
Poverty Impacts During Curfew Period
National poverty rate increases 6.2 percentage points during curfew
Increase in share of population living in
poverty during curfew period (%)
Increase in number of poor people in Niger
during curfew period (mil.)
Source: Niger SAM Multiplier Results
(equates to 1.5 million additional poor people)
6.2%
6.9%
2.7%
National Rural Urban
1.5
1.4
0.1
National Rural Urban
Updated: Dec 2 2020
4
Economic Impacts Under Fast & Slow
Easing of Restrictions & Recovery
Updated: Dec 2 2020
Easing of Restrictions & Recovery
We consider two stylized scenarios:
Faster easing: Most restrictions are gradually lifted by the end of 2020, but significant
shocks due to closures of land borders remain until the end of 2021
Slower easing: Restrictions are moderately relaxed till end of 2021
Faster easing Slower easing Global shocks
Q1-2020
Jan - Feb No shocks in pre-COVID-19 period
Mar
Curfew period from March 29th to May 13th
Q2-2020
Apr
May
Shocks reduced by 20% (domestic trade
by 50%)
Shocks to domestic trade reduced by 50%
Faster easing : Shocks to uranium
exports (1), FDI (2), and foreign
remittances (3) reduced by 20%Jun
Q3-2020
Jul
Shocks reduced by 50% (domestic trade at
50%, tourism and hotel by 30%)
Shocks reduced by 40% in the rest of the
economy (domestic trade at 50%, tourism
and hotel by 30%)
Faster easing: Shocks to (1) and (2)
reduced by 50%; (3) by 30%
Slower easing: Shocks to (1) and (2)
reduced by 40%; (3) by 30%
Aug
Sep
Q4-2020
Oct
Shocks reduced by 90% (tourism and hotel
by 50%)
Shocks reduced by 80% (tourism and hotel
by 40%)
Faster easing: Shocks to (1) and (2)
reduced by 90%; (3) by 50%
Slower easing: shocks to (1) and (2)
reduced by 80%; (3) by 40%
Nov
Dec
2021
Apart from shocks due to closures of land
borders, most shocks disappear before
2021
Shocks dissipate progressively as the entire
economy returns to full production by end
of Q4 2021
Faster easing: Shocks to (3) only
remain in 2021
Slower easing:. Shocks to (1), (2), and
(3) persist in 2021, dissipate gradually
to disappear by end of 2021
Updated: Dec 2 2020
GDP Impacts with Recovery Scenarios
Source: Niger SAM Multiplier Results
Change in quarterly (2020) & annual (2020–2021) national GDP under fast or slow
easing scenarios
(changes are relative to a no-COVID growth scenario)
National GDP may be 5.0-5.8% lower over 2020; losses extend into
2021, but likely to be minimal
-0.3%
-10.8%
-6.6%
-2.3%
-0.5% -0.3% -0.1% 0.0%
-5.0%
-0.2%
-0.3%
-12.1%
-7.5%
-3.5%
-2.0%
-1.0%
-0.4% 0.0%
-5.8%
-0.8%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2020 2021
2020 2021 Annual
Faster recovery Slower recovery
Updated: Dec 2 2020
Cumulative Quarterly GDP Losses
Even with faster recovery, Niger ends 2021 with lower GDP
(GDP losses accumulate each quarter & will take time to recover to pre-COVID levels)
Cumulative changes in 2021 GDP from end of 2019
(pre-COVID expected growth rate for 2020 was 6% according to the World Bank Macro-Poverty Outlook)
Source: Niger SAM Multiplier Results
-500
0
500
1,000
1,500
2,000
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2019 2020 2021
CumulativeGDPgainrelativeto2019Q4
US$millions
Projected path
Faster recovery
Slower recovery
Updated: Dec 2 2020
Poverty Impacts with Recovery Scenarios
Source: Niger SAM Multiplier Results
Change in national poverty rate under fast or slow easing of restrictions
(changes are relative to pre-COVID poverty levels)
Poverty should stabilize in 2021 as people return to work,
incomes recover & consumer demand resumes
(this hides sharp spike in mid-year poverty, when many households living close to the
poverty line may require government or other support to cope)
0.2%
5.2%
3.1%
1.5%
0.2% 0.2% 0.0% 0.0%
2.5%
0.1%0.2%
6.2%
3.4%
1.8%
1.4%
0.4%
0.2% 0.0%
2.9%
0.5%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2020 2021
2020 2021 Annual
Faster recovery
Slower recovery
Updated: Dec 2 2020
A
Detailed Assumptions About
Production & Demand Shocks
Updated: Dec 2 2020
Channels, Shocks & Affected Sectors (1)
Type of restriction or global
shock
Major sectors
affected2
Size of
shock
Detailed subsectors affected by shock2
Direct restrictions on
farming
Agriculture
(A)
0% Crop/animal production, hunting, related service activities (D01); forestry, logging (D02); fishing,
aquaculture (D03)
Limiting mining operations Mining,
quarrying (B)
-11% Coal, lignite (D5); crude petroleum, natural gas (D06); metal ores (D07); quarrying (D08); mining
support service activities (D09)
Closing non-essential
manufacturing operations
Manufacturing
(C)
-5% Food products (D10); Beverages, tobacco (D11-12); textiles, clothing, leather (D13-15); metals
(D24-25); electromedical equipment (G266);
-50% Wood, paper, printing (D16-18); chemicals, rubber, plastics (D20-21)
-6% Coke, refined petroleum (D19)
-66% Pharmaceuticals medicinal chemicals (D21)
-9% Non-metallic minerals (D23); equipment, machinery (D26-28 excl. G266); vehicles, transport
equipment (D29-30); furniture (D31), other manufactures (D33)
Disruptions to energy and
water supply
Electricity, gas
(D); water supply
(E)
0% Electricity, gas, steam supply (D35); water collection, treatment, supply (D36); sewerage, waste
collection/remediation (D37-39)
Limiting construction
activities
Construction
(F)
0% Construction of buildings (D41); civil engineering (D42); specialized construction activities (D43)
Closing non-essential trading
activities
Wholesale (G) -0% Agricultural raw materials, live animals (G462); agricultural machinery, equipment, supplies
(C4653); food, beverages, tobacco, incl. stalls & markets (G463 G471-472 C4781); construction
materials, hardware, plumbing, heating equipment (C4663); automotive fuels (G473); wholesale
trade (D46 excl. G462-463 C4653 C4663);
Retail trade (G) -10% Motor vehicle trade/repair (D45);
Retail trade (D47 excl. G471-472 G47 C4781)
Transport/travel restrictions Transportation,
storage (H)
-70% Freight rail/road/air transport (C4912 C4923 G512); warehousing/storage (G521)
-80% Urban/suburban passenger/other land transport (C4911 C4921-4922)
-60% Passenger air transport (G511)
Government work-from-
home orders
Public
administration,
defense (O)
-20% Public administration, defense, compulsory social security (D84)
Closing hotels
Closing bars, restaurants
Accommodation,
food services (I)
-70%
-60%
Accommodation (D55); food/beverage service activities (D56)
Updated: Dec 2 2020
Channels, Shocks & Affected Sectors (2)
Type of restriction or
global shock
Major sectors
affected2
Size of
shock
Detailed subsectors affected by shock2
Closing non-essential
business services
Information,
communication
(J); finance,
insurance (K); real
estate (L);
professional/
scientific/technica
l activities (M);
administrative/
support services
(N)
-10% Publishing activities (D58); programming/broadcasting activities (D60);
telecommunications (D61); computer programming/consultancy activities (D62);
information service activities (D63); financial services, insurance, pension funding, auxiliary
services (D64-66); real estate activities (D68); security and investigation activities (D80)
-10% Accounting, bookkeeping, auditing, tax consultancy (G692); head offices, management
consultancy (D70); scientific research/development (D72); advertising, market research
(D73); other professional/scientific/technical activities (D74);
-10% Legal activities (G692); architectural/engineering activities (D71); veterinary activities (D75)
-10% Motion picture/video/television program production, etc. (D59); renting/leasing activities
(D77); employment activities (D78); travel agencies, tour operators (D79); building
services, landscape activities (D81); office administrative, office support, other business
support activities (D82)
Closing schools Education (P) -10% Pre-primary and primary education (G851)
-10% Secondary education (G852); Other education (G854)
-10% Higher education (G853); Educational support activities (G855)
Disruptions to hospitals
and clinics
Human health,
social work (Q)
0% Human health activities (D86); residential care activities (D87); social work activities
without accommodation (D88)
Banning sports & other
entertainment
Arts, recreation,
entertainment (R)
0% Creative/arts/entertainment activities (D90); libraries, archives, museums, other cultural
activities (D91); gambling, betting activities (D92); sports, amusement/recreation activities
(D93)
Domestic workers &
other services
Other service
activities (S);
households as
employers (T);
extraterritorial
organizations (U)
0% Extraterritorial organizations/bodies (D99)
-10% Membership organizations (D94)
-10% Other personal services (D96); domestic workers/personnel (D97); Other production
activities of private households for own use (D98)
-10% Repairing computers & personal/household goods (D95)
Note: Numbers in parentheses are International Standard Industrial Classification (ISIC Revision 4) codes (by major section with detailed subsectors, D
is division, G is group and C is class).

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Niger: Impacts of COVID-19 on Production, Poverty and Food Systems

  • 1. Niger Impacts of COVID-19 on Production, Poverty & Food Systems Disclaimer: The analysis presented in this slide deck are the authors’ own and do not necessarily reflect the view of the authors’ institutions. Financial support from Karl Pauw1, Josée Randriamamonjy1, Alkassoum Sangaré Saadatou2, and James Thurlow1 1 International Food Policy Research Institute 2 Cellule d’Analyse des Politiques Publiques et d’Evaluation de l’Action Gouvernementale (CAPEG) Updated: 2 December 2020 Contact: Josée Randriamamonjy (J.Randriamamonjy@cgiar.org)
  • 2. Updated: Dec 2 2020 Curfew Imposes Significant Economic Costs • National GDP is estimated to fall by 12% during curfew period (US$ 203 mil. in lost GDP) • Food system is adversely affected by falling consumer & export demand (6% agri-food GDP decline, despite exemptions) • Poverty rate increases by 6 percentage points during the curfew period (1.5 million more people temporarily living below the national poverty line) Source: Niger SAM Multiplier Results Economic impacts during curfew period 12.1 5.9 6.2 Percentage decline in national GDP Percentage decline in agri-food system GDP Percentage point increase in national poverty rate 2.0 1.5 Decline in national GDP in US$ 100 millions Increase in number of poor people in millions
  • 3. Updated: Dec 2 2020 Costs Likely to Persist Throughout 2020 • Economy is reopening & some restrictions are eased • But economic losses remain, even with a fast recovery (GDP may be 5.0-5.8% lower in 2020; losses extend into 2021, but likely to be minimal compared to a no-COVID scenario) • Average GDP & poverty rates for 2020 hide sharp mid-year deteriorations (some businesses & people will require government support to cope & recover) Change in quarterly GDP Change in national poverty rate (national poverty line) Quarterly national impacts under faster or slower easing recovery (changes are relative to a no-COVID scenario) -0.3% -10.8% -6.6% -2.3% -5.0% -0.2% -0.3% -12.1% -7.5% -3.5% -5.8% -0.8% Q1 Q2 Q3 Q4 2020 2021 2020 Annual Faster recovery Slower recovery 0.2% 5.2% 3.1% 1.5% 2.5% 0.1% 0.2% 6.2% 3.4% 1.8% 2.9% 0.5% Q1 Q2 Q3 Q4 2020 2021 2020 Annual
  • 4. Updated: Dec 2 2020 COVID-19 Outbreak & Restriction Policies in Niger1
  • 5. Updated: Dec 2 2020 -10 0 10 20 30 40 50 60 70 80 13-Mar 20-Mar 27-Mar 3-Apr 10-Apr 17-Apr 24-Apr 1-May 8-May 15-May 22-May 29-May 5-Jun 12-Jun 19-Jun 26-Jun 3-Jul 10-Jul 17-Jul 24-Jul 31-Jul 7-Aug 14-Aug 21-Aug 28-Aug 4-Sep 11-Sep 18-Sep 25-Sep 2-Oct 9-Oct 16-Oct Confirmednewcases COVID-19 Cases & Policy Timeline First confirmed case in Niger Cancellation of international meetings due to take place in Niamey (Francophonie and OIC) 03/13 - Curfew in Niamey, the Capital, declared from 7 pm to 6 am 03/28 - Quarantine in Niamey declared for two weeks - Public health emergency announced - Lifting of curfew and quarantine in Niamey 05/13 - Reopening of places of worship - Release of inter-urban passenger transportation Extension of state of emergency for an additional 3 months in Diffa and in several departments of the Tillaberi and Tahoua regions 06/15 - Closure of bars, nightclubs and others entertainment centers 03/ 20 - Recommendations to follow good hygiene practices and social distancing protocols - Ban on public gatherings of more than 50 people - Prohibition of collective prayers, closure of places of worship and ban on religious gatherings - Closure of schools and universities - Closure of land borders (except for goods) - Closure of Niamey and Zinder international airports (except for domestic, cargo, health and military flights) - Closure of bus stations and suspension of public transportation - Reinstatement of normal working hours, i.e. from 8 am to 5.30 pm, from Monday to Thursday and from 8 am to 1 pm on Fridays; lifting of the reduction of staff 05/25 - Suspension of the ban on workshops and seminars - Reopening of school 06/01 Niger never imposed a strict lockdown of business, instead opting for a curfew from March 28th to May 13th, combined with work from home and reduced working hours, school closures, domestic and international travel restrictions, and social distancing measures. Extension of state of emergency in Tillabéri and Gotheye departments 06/22 Air border closure lifted but land borders remain closed
  • 6. Updated: Dec 2 2020 Sectors Affected by COVID-19 & Restrictions (1) Sector Restrictions or exemptions during national curfew period Directly Affected? Agriculture Despite deficits from last growing season, agricultural production expected to resume due to favorable rainfall levels in 2020. Sector is exempted from direct COVID restrictions. Possible benefits from favorable weather not analyzed. None Mining Extraction of crude petroleum and natural gas expected to decline 11% in 2020 as a result of supply chain disruptions Some Manufacturing Direct effect of cross-border intermediate input flows from Nigeria, Burkina Faso, Benin, Togo, Ghana and Côte d’Ivoire (land borders still closed). Not included high transaction costs caused by measures imposed in supplier countries. Some (high for pharmaceutical, chemical, wood products) Utilities Electricity & water distribution exempt (essential sector) None Construction No direct effect of curfew anticipated for public or private construction (imposed from 7pm to 6am) None Wholesale & retail trade services Border closures affect availability and domestic trade of imported goods (imports from UEMOA account for 54% of imports from Africa) Some Transportation, storage & cargo Land borders closed to passenger vehicle traffic; cargo and freight exempt. Ban on urban transport at night. Suspension of all commercial passenger air travel High Hotels & food services Hotels closures and/or significantly reduced patronage. Closure of night clubs, bars, and restaurants High
  • 7. Updated: Dec 2 2020 Sectors Affected by COVID-19 & Restrictions (2) Sector Restrictions or exemptions during national curfew period Directly Affected? Banking, finance & insurance Direct effect of reduced working hours in formal service sectors anticipated for banking, finance and insurance sector Some Professional & business services No direct effect of curfew anticipated for banking, finance and insurance sector, although work-from-home measures, job layoffs, and social distancing have some impact on supply or demand Some Public admin & law enforcement Reduced working hours in public sectors (added to difficult adjustment to work- from-home measures) High Education services All public schools closed mid-March to early June; limited scope for online delivery Some Health services Health services exempt (essential service) None Sports & entertainment Sports, religious, cultural and political gatherings suspended mid-March to mid- September Some
  • 8. Updated: Dec 2 2020 Sectors Affected by COVID-19 & Restrictions (3) Sector Nationwide Directly Affected? Export demand Closure of the border with Nigeria affects uranium exports (-9%) - losses cushioned by rising uranium prices (12%) Some Remittances Declines in the value of remittances sent by citizens working abroad Some Foreign direct investments Falling foreign direct investment in machinery, equipment, vehicles, and construction activities Some See detailed sector-level assumptions about production & demand shocks in Annex at the end of slide deck
  • 9. Updated: Dec 2 2020 Measuring Economic Impacts2
  • 10. Updated: Dec 2 2020 Economywide Multiplier Analysis • Lockdown policies & other shocks have direct impacts on the operation of certain sectors (e.g., closing schools, banning sports events, restricting travel, etc.) • But they also generate indirect impacts on other sectors involved in supply chains (i.e., input suppliers & downstream users) • Multiplier analysis uses sector input-output data to measure direct & indirect impacts throughout & across supply chains (incl. impacts on GDP, jobs & household incomes) • Niger model based on 2018 SAM & 2014 household survey data (results scaled to 2019 GDP & employment levels)
  • 11. Updated: Dec 2 2020 Economywide Impacts GDP | Jobs Incomes | Poverty Direct impacts Framework for Analyzing COVID-19 GlobalImpact Channels (Due to partial or full lockdowns in other countries) Indirect impacts DomesticImpact Channels (Due to partial or full lockdowns in own country) • Export demand • Remittances & migration • Foreign direct investments • Agriculture • Mining & crude oil • Manufacturing • Utilities (energy, water) • Construction • Whole & retail trade services • Transportation, storage & cargo • Hotels & food services • Banking, finance & insurance • Professional & business services • Public administration & law enforcement • Education services • Health & social services • Sports & entertainment • Community & other services
  • 12. Updated: Dec 2 2020 Impact Channels & Shocks • Restrictions during curfew period are simulated using a range of impact channels • Shocks to each channel are imposed on the model & impacts are simultaneously traced across all supply chains • Multiplier model separates Niger economy into 86 sectors (shocks are calculated bottom-up using supply-use data for 136 goods & services) • Size of shocks is estimated by IFPRI’s staff & collaborators (see Annex)
  • 13. Updated: Dec 2 2020 Curfew Period & Recovery Scenarios Q1-2020 Q2-2020 Q3-2020 Q4-2020 Curfewimposed Minimaleasingof restrictionsrestofQ2 1 2 1. Impacts during curfew period only • Six-week period during which curfew is imposed and social distancing measures are most stringent • Shocks assumed to be imposed nationwide 2. Impacts for rest of 2020 and 2021 as restrictions are lifted • We will compare a faster vs. slower easing of restrictions over two years, although most restrictions are fully lifted by the end of 2020 • Analysis accounts for intra-annual seasonality Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Q1-2021 Q2-2021 Q3-2021 Q4-2021 Further easing of restrictions in Q3 2020 Apart from significant decline in tourism and hotel due to closures of land borders, minimal impacts remain in the rest of the economy as it returns to full production by end of Q4 2021 Most restrictions lifted by end of Q4 2020
  • 14. Updated: Dec 2 2020 Economic Impacts During Curfew3
  • 15. Updated: Dec 2 2020 GDP Losses During Curfew National GDP drops 12% during curfew (economic losses largest in the services sectors, in both relative and absolute terms) Source: Niger SAM Multiplier Results Change in total GDP during curfew period (%) Change in total GDP during curfew period (US$ mil.) -12.1% -4.1% -16.2% -17.6% Total Agriculture Industry Services -$203.3 -$26.1 -$61.4 -$115.8 Total Agriculture Industry Services
  • 16. Updated: Dec 2 2020 33.7% 18.1% 10.1% 6.3% 6.2% 6.2% 5.6% 4.9% 3.3% 2.8% 2.3% 0.5% Passenger & other transport restrictions Reduced hotel & restaurant patronage Shocks to foreign direct investment Restrictions on business services Uranium export shocks Reduced crude oil extraction Disruption to input supply chains School closures Shocks to foreign remittances Other services Constrained wholesale & retail trade Government work from home Sources of GDP Losses Transport and hospitality restrictions account for half of GDP losses Contribution of restrictions & shocks to loss in total GDP during curfew period (sums to 100%) (significant contribution of shocks to foreign direct investment) Hotel and restaurant restrictions have knock- on impacts on agriculture and food supply Source: Niger SAM Multiplier Results Loss due to passenger transport restrictions and reduced transport demand caused by economic slowdown Impact of foreign investment restrictions on large investment including infrastructure construction
  • 17. Updated: Dec 2 2020 -5.9% -4.1% -13.6% -7.2% -38.5% Agri-food system (47.7%) Agriculture (38.6%) Agro-processing (2.0%) Food trade and transport (5.9%) Food services (1.3%) -$46.5 -$26.1 -$5.0 -$7.0 -$8.3 Agri-food system (51.2%) Agriculture (40.7%) Agro-processing (4.3%) Food trade and transport (5.6%) Food services (0.5%) Impacts on the Agri-Food System Food supply is exempt from most restrictions, but it is still indirectly affected by falling consumer incomes & other shocks Change in agri-food GDP during curfew period (%) Change in agri-food GDP during curfew period (US$ mil.) (food services is directly affected by the closing of hotels, restaurants & bars, but this is a small component of the overall agri-food system) Source: Niger SAM Multiplier Results Share of total GDP in 2018 (%)
  • 18. Updated: Dec 2 2020 53.8% 13.7% 9.6% 7.7% 7.7% 1.9% 1.6% 1.4% 1.1% 0.8% 0.5% 0.1% Reduced hotel & restaurant patronage Passenger & other transport restrictions Shocks to foreign remittances Disruption to input supply chains Shocks to foreign direct investment Uranium export shocks Restrictions on business services School closures Reduced crude oil extraction Other services Constrained wholesale & retail trade Government work from home Sources of Agri-Food System GDP Losses Hotel and restaurant restrictions contribute most to agri-food GDP losses via its significant indirect impact on food supply Contribution of restrictions & shocks to loss in agri- food GDP during curfew period (sums to 100%) (effect of transport restrictions is also significant) Foreign remittances account for almost 2% of household incomes in Niger Source: Niger SAM Multiplier Results Transport disruptions to food supply chains Significant knock-on effects on food supply chains in addition to direct effects on hospitality industry
  • 19. Updated: Dec 2 2020 -4.1% -1.9% -2.5% -1.1% -0.4% -0.8% -6.4% -9.6% -8.8% -10.7% -1.1% -10.6% -8.6% Agriculture Crops Cereals Pulses & oilseeds Root crops Fruits & vegetables Sugarcane Export crops Livestock Meat & eggs Dairy Forestry Fishing Unpacking Agricultural GDP Impacts Cereal crops are the largest food group and agric. subsector in Niger Livestock sector affected by decline in restaurant demand for meat Share of agric. GDP in 2018 (%) (69.6%) (10.7%) (1.0%) (18.8%) (0.3%) (0.6%) (20.6%) (16.6%) (4.0%) (6.6%) (3.3%) Source: Niger SAM Multiplier Results (38.3%) Change in GDP during curfew period (%) Falling FDI reduces construction and demand for wood inputs Large percentage losses in small agricultural sectors
  • 20. Updated: Dec 2 2020 -7.8% -5.3% -5.4% -5.3% -9.0% -10.0% -5.6% -9.7% -10.4% -21.7% Food processing Meat Fish Dairy Fruits & vegetables Fats & oils Cereal milling Sugar refining Other food Beverages and tobacco Unpacking Agricultural GDP Impacts Change in GDP during curfew period (%) Source: Niger SAM Multiplier Results Note: Agri-food processing is a subsector within manufacturing Urban and higher-income households who are the most affected are also the main consumers of beverage and tobacco and processed food
  • 21. Updated: Dec 2 2020 Impacts on Household Incomes Source: Niger SAM Multiplier Results Change in household incomes during curfew period (%) All households experience large income losses (larger income losses for urban and higher-income households who are more likely employed in sectors affected more directly by restrictions) -12.0% -8.5% -12.7% -9.3% -8.4% -15.2% -16.3% All households Quintiles 1-2 Quintiles 3-5 Rural Rural Farm Rural Nonfarm Urban
  • 22. Updated: Dec 2 2020 Poverty Impacts During Curfew Period National poverty rate increases 6.2 percentage points during curfew Increase in share of population living in poverty during curfew period (%) Increase in number of poor people in Niger during curfew period (mil.) Source: Niger SAM Multiplier Results (equates to 1.5 million additional poor people) 6.2% 6.9% 2.7% National Rural Urban 1.5 1.4 0.1 National Rural Urban
  • 23. Updated: Dec 2 2020 4 Economic Impacts Under Fast & Slow Easing of Restrictions & Recovery
  • 24. Updated: Dec 2 2020 Easing of Restrictions & Recovery We consider two stylized scenarios: Faster easing: Most restrictions are gradually lifted by the end of 2020, but significant shocks due to closures of land borders remain until the end of 2021 Slower easing: Restrictions are moderately relaxed till end of 2021 Faster easing Slower easing Global shocks Q1-2020 Jan - Feb No shocks in pre-COVID-19 period Mar Curfew period from March 29th to May 13th Q2-2020 Apr May Shocks reduced by 20% (domestic trade by 50%) Shocks to domestic trade reduced by 50% Faster easing : Shocks to uranium exports (1), FDI (2), and foreign remittances (3) reduced by 20%Jun Q3-2020 Jul Shocks reduced by 50% (domestic trade at 50%, tourism and hotel by 30%) Shocks reduced by 40% in the rest of the economy (domestic trade at 50%, tourism and hotel by 30%) Faster easing: Shocks to (1) and (2) reduced by 50%; (3) by 30% Slower easing: Shocks to (1) and (2) reduced by 40%; (3) by 30% Aug Sep Q4-2020 Oct Shocks reduced by 90% (tourism and hotel by 50%) Shocks reduced by 80% (tourism and hotel by 40%) Faster easing: Shocks to (1) and (2) reduced by 90%; (3) by 50% Slower easing: shocks to (1) and (2) reduced by 80%; (3) by 40% Nov Dec 2021 Apart from shocks due to closures of land borders, most shocks disappear before 2021 Shocks dissipate progressively as the entire economy returns to full production by end of Q4 2021 Faster easing: Shocks to (3) only remain in 2021 Slower easing:. Shocks to (1), (2), and (3) persist in 2021, dissipate gradually to disappear by end of 2021
  • 25. Updated: Dec 2 2020 GDP Impacts with Recovery Scenarios Source: Niger SAM Multiplier Results Change in quarterly (2020) & annual (2020–2021) national GDP under fast or slow easing scenarios (changes are relative to a no-COVID growth scenario) National GDP may be 5.0-5.8% lower over 2020; losses extend into 2021, but likely to be minimal -0.3% -10.8% -6.6% -2.3% -0.5% -0.3% -0.1% 0.0% -5.0% -0.2% -0.3% -12.1% -7.5% -3.5% -2.0% -1.0% -0.4% 0.0% -5.8% -0.8% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2020 2021 2020 2021 Annual Faster recovery Slower recovery
  • 26. Updated: Dec 2 2020 Cumulative Quarterly GDP Losses Even with faster recovery, Niger ends 2021 with lower GDP (GDP losses accumulate each quarter & will take time to recover to pre-COVID levels) Cumulative changes in 2021 GDP from end of 2019 (pre-COVID expected growth rate for 2020 was 6% according to the World Bank Macro-Poverty Outlook) Source: Niger SAM Multiplier Results -500 0 500 1,000 1,500 2,000 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2019 2020 2021 CumulativeGDPgainrelativeto2019Q4 US$millions Projected path Faster recovery Slower recovery
  • 27. Updated: Dec 2 2020 Poverty Impacts with Recovery Scenarios Source: Niger SAM Multiplier Results Change in national poverty rate under fast or slow easing of restrictions (changes are relative to pre-COVID poverty levels) Poverty should stabilize in 2021 as people return to work, incomes recover & consumer demand resumes (this hides sharp spike in mid-year poverty, when many households living close to the poverty line may require government or other support to cope) 0.2% 5.2% 3.1% 1.5% 0.2% 0.2% 0.0% 0.0% 2.5% 0.1%0.2% 6.2% 3.4% 1.8% 1.4% 0.4% 0.2% 0.0% 2.9% 0.5% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2020 2021 2020 2021 Annual Faster recovery Slower recovery
  • 28. Updated: Dec 2 2020 A Detailed Assumptions About Production & Demand Shocks
  • 29. Updated: Dec 2 2020 Channels, Shocks & Affected Sectors (1) Type of restriction or global shock Major sectors affected2 Size of shock Detailed subsectors affected by shock2 Direct restrictions on farming Agriculture (A) 0% Crop/animal production, hunting, related service activities (D01); forestry, logging (D02); fishing, aquaculture (D03) Limiting mining operations Mining, quarrying (B) -11% Coal, lignite (D5); crude petroleum, natural gas (D06); metal ores (D07); quarrying (D08); mining support service activities (D09) Closing non-essential manufacturing operations Manufacturing (C) -5% Food products (D10); Beverages, tobacco (D11-12); textiles, clothing, leather (D13-15); metals (D24-25); electromedical equipment (G266); -50% Wood, paper, printing (D16-18); chemicals, rubber, plastics (D20-21) -6% Coke, refined petroleum (D19) -66% Pharmaceuticals medicinal chemicals (D21) -9% Non-metallic minerals (D23); equipment, machinery (D26-28 excl. G266); vehicles, transport equipment (D29-30); furniture (D31), other manufactures (D33) Disruptions to energy and water supply Electricity, gas (D); water supply (E) 0% Electricity, gas, steam supply (D35); water collection, treatment, supply (D36); sewerage, waste collection/remediation (D37-39) Limiting construction activities Construction (F) 0% Construction of buildings (D41); civil engineering (D42); specialized construction activities (D43) Closing non-essential trading activities Wholesale (G) -0% Agricultural raw materials, live animals (G462); agricultural machinery, equipment, supplies (C4653); food, beverages, tobacco, incl. stalls & markets (G463 G471-472 C4781); construction materials, hardware, plumbing, heating equipment (C4663); automotive fuels (G473); wholesale trade (D46 excl. G462-463 C4653 C4663); Retail trade (G) -10% Motor vehicle trade/repair (D45); Retail trade (D47 excl. G471-472 G47 C4781) Transport/travel restrictions Transportation, storage (H) -70% Freight rail/road/air transport (C4912 C4923 G512); warehousing/storage (G521) -80% Urban/suburban passenger/other land transport (C4911 C4921-4922) -60% Passenger air transport (G511) Government work-from- home orders Public administration, defense (O) -20% Public administration, defense, compulsory social security (D84) Closing hotels Closing bars, restaurants Accommodation, food services (I) -70% -60% Accommodation (D55); food/beverage service activities (D56)
  • 30. Updated: Dec 2 2020 Channels, Shocks & Affected Sectors (2) Type of restriction or global shock Major sectors affected2 Size of shock Detailed subsectors affected by shock2 Closing non-essential business services Information, communication (J); finance, insurance (K); real estate (L); professional/ scientific/technica l activities (M); administrative/ support services (N) -10% Publishing activities (D58); programming/broadcasting activities (D60); telecommunications (D61); computer programming/consultancy activities (D62); information service activities (D63); financial services, insurance, pension funding, auxiliary services (D64-66); real estate activities (D68); security and investigation activities (D80) -10% Accounting, bookkeeping, auditing, tax consultancy (G692); head offices, management consultancy (D70); scientific research/development (D72); advertising, market research (D73); other professional/scientific/technical activities (D74); -10% Legal activities (G692); architectural/engineering activities (D71); veterinary activities (D75) -10% Motion picture/video/television program production, etc. (D59); renting/leasing activities (D77); employment activities (D78); travel agencies, tour operators (D79); building services, landscape activities (D81); office administrative, office support, other business support activities (D82) Closing schools Education (P) -10% Pre-primary and primary education (G851) -10% Secondary education (G852); Other education (G854) -10% Higher education (G853); Educational support activities (G855) Disruptions to hospitals and clinics Human health, social work (Q) 0% Human health activities (D86); residential care activities (D87); social work activities without accommodation (D88) Banning sports & other entertainment Arts, recreation, entertainment (R) 0% Creative/arts/entertainment activities (D90); libraries, archives, museums, other cultural activities (D91); gambling, betting activities (D92); sports, amusement/recreation activities (D93) Domestic workers & other services Other service activities (S); households as employers (T); extraterritorial organizations (U) 0% Extraterritorial organizations/bodies (D99) -10% Membership organizations (D94) -10% Other personal services (D96); domestic workers/personnel (D97); Other production activities of private households for own use (D98) -10% Repairing computers & personal/household goods (D95) Note: Numbers in parentheses are International Standard Industrial Classification (ISIC Revision 4) codes (by major section with detailed subsectors, D is division, G is group and C is class).