(Ecofin Agency) - Niger is dealing with heavy sanctions imposed by both the international and regional community to express their stance against the July 26 coup. The financial burden that comes with these measures has led the government to lower its state budget for 2023.

The Niger government has announced it is revising the 2023 finance act downward to CFA1,981 billion ($3.18 billion) from an initial forecast of CFA3,291.62 billion ($5.28 billion). This move is in response to the heavy sanctions imposed on the country by regional and international organizations following the July 26 coup.

"(...) these sanctions significantly weaken the flow of internal and external resources in our country. That's what led us to revise the budget downward," said Mahamane Roufai Laouali, Secretary-General of the Government, without specifying which sectors will see their resources reduced.

As a reminder, sanctions mainly came from the Economic Community of West African States (ECOWAS), the European Union, and the United States and consisted of asset freezing and humanitarian aid suspension. The immediate consequence has been a sharp rise in food prices. For example, since the sanctions were announced, the price of rice has risen by 21%, and sorghum by 14%, according to the World Food Program.

The already economically weak country is also dealing with a security crisis due to attacks by armed groups.

The initial Finance Act, which was based on reforms designed to mobilize resources and broaden the tax base, allocated 13% of the budget to equipping the defense and security forces. The energy sector took 25% of the budget.