Niger has borrowed 50 billion CFA francs from the government of Republic of Congo as it seeks to cover increased budget spending, said the finance minister.
The arid West African country, one of the world’s newest oil producing nations, has twice increased its 2012 budget, which is due to grow by 55 percent compared with 2011.
“The Congolese loan is at an interest rate of 4 percent, and it is reimbursable over a period of 10 years … I signed this loan agreement,” Finance Minister Gilles Baillet told parliament, saying the conditions were better than for a bond, Reuters reports.
President Issoufou Mahamoudou, who took office little over a year ago, has promised to invest 6 trillion CFA francs in education, health, agriculture, infrastructure and job creation over the next five years to help fight poverty.
But his government has had to cope with a recurring food crisis as well as fallout from last year’s war in neighbouring Libya. It also shares a border with northern Mali, currently under the control of rebels and Islamist groups with links to al Qaeda.
Nearly a third of the latest budget increase is for defence and security spending.
Already a top uranium producer, Niger pumped the first oil from its estimated 650 million barrels of reserves in November through a $5 billion joint venture deal with Chinese oil company
The government signed nine production sharing agreements with five oil firms earlier this month as it seeks to diversify its foreign partners.