Mali is a vast landlocked and geographically diverse country of 1,241,238 km². It is a predominantly desert country with a highly undiversified economy. As such, it is vulnerable to commodity price fluctuations and to the consequences of climate change. Mali has a population of more than 17 million, 10 percent of whom live in the northern regions. High population growth rates and drought have fueled food insecurity, poverty, and instability. The delivery of services in this large, sparsely populated territory is challenging, and affects geographic equity and social cohesion.
The political and security situation has been particularly volatile in recent years. In early 2012, there was a military coup and an occupation of the northern regions by armed groups. These events were followed by the deployment of French-led military forces in January 2013; the French handed over to the United Nations Multidimensional Integrated Stabilization Mission in Mali (MINUSMA) in July 2013. In 2014, the French reorganized their anti-terrorist interventions in the Sahel, establishing their operational headquarters in N’Djamena (Chad).
Two rounds of presidential elections were held peacefully in Mali in July and August 2013. Local government elections took place in November 2016.
Peace negotiations between government and two rebel coalitions, known as the “Platform” and “Coordination” groups, concluded in the signing of an agreement on 15 May 2015 by both the government and the Platform group, and the government and the Coordination group on 20 June, 2015. While the new agreement does not envision an autonomous status for the northern regions, it gives a stronger impetus to decentralization, creating a critical role for these regions and a development zone consisting of the northern regions with the implementation of a program of accelerated development (Programme de développement accéléré du Nord- PDAN).
Its implementation, however, remains challenging. Security, which is critical for ensuring economic recovery and poverty reduction, remains fragile, with continuing attacks on the UN force and the Malian army by terrorist groups, mainly again in northern regions of Mali.
While Mali experienced an overall drop in national poverty from 55.6 percent in 2001 to 43.6 percent in 2010, regional differences persist and, in 2013, the poverty rate rebounded to 45 percent.
Mali ranked 176th out of 188 countries on the 2015 United Nations Human Development Index. Poverty is much lower in urban areas, with 90 per-cent of all poor living in rural areas in the south, where population density is highest. Drought and conflict have only increased the incidence of poverty. Given the lack of reliable estimates, there is a dire need to improve welfare measurements and data collection to better understand the livelihoods of poor households.
Over the past few years, Mali’s economic growth has been influenced by several exogenous shocks. The country’s steady state growth rate has hovered around 4.5 percent over the last decade, driven by rapid growth in labor supply, urbanization (along with informal sector and tertiary sector development), extensive agriculture, public investment, and gold mining activities. The structure of its Gross Domestic Product (GDP) has remained relatively stable since 1990, with the primary (agriculture, gold) and tertiary sectors (trade, transport, and public administration) each contributing 35-40 per-cent to GDP, with the secondary sector making up the balance. Mali’s industrial sector is limited (4 per-cent of GDP) and consists largely of privately owned small enterprises and a few large enterprises (cotton milling, electricity, and mining).
With the progressive consolidation of political stability and improved security conditions, growth accelerated to 7.0 per-cent in 2014, its highest level since 2003, and remained robust in 2015 and 2016 at 6.0 percent and 5.4 percent, respectively. Mali’s economy is projected to grow by around 5 percent over the period 2017-2019, reflecting a return to normalcy and a gradual tapering of the recent surge in international aid.
All economic sectors are expected to contribute to growth, especially the tertiary sector, which is projected to grow faster, thanks to the continued dynamism of telecommunications and transport. Mali’s favorable economic outlook is subject to substantial and persistent downside risks, among which the most critical are the collapse of the peace agreement and the resurgence of insecurity throughout the country, recurrence of lapses in governance, climatic shocks, and any further decline in global prices of gold or cotton, the major two export products of Mali.
Last Updated: May 02, 2017