Niger is facing payment difficulties on its domestic debt due to sanctions imposed following last year’s coup.
The Nigerien authorities missed a 13.4 billion CFA franc ($22 million) principal payment on a one-year bond that matured on February 16.
Interest payments on two seven-year notes due in 2027 and 2030 were also not made.
These missed payments have accumulated to a total of $604 million in arrears since soldiers ousted President Mohamed Bazoum in July.
The situation is because of the sanctions which have been imposed on the West African nations following the coup.
The growing number of missed payments poses a threat to the financial stability of West African banks.
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Moody’s Investors Service estimates that Niger-based lenders held approximately $543 million of Nigerien sovereign debt, constituting about 14% of their assets, as of November.
The ratings company evaluates banks operating in Niger, including Ecobank Transnational Inc., Oragroup SA, Attijariwafa Bank, Groupe Banque Centrale Populaire, and Bank of Africa.
The Economic Community of West African States (ECOWAS), a regional economic bloc, suspended all commercial and financial transactions between member states and Niger shortly after the coup, effectively restricting transfers to creditors outside the country.
Niger, along with neighboring Mali and Burkina Faso, both also under military rule, announced their exit from ECOWAS last month.
The three nations’ governments recently agreed to form a union of states known as the Alliance of Sahel States.
