Mauritania is mostly a desert country, with a population of about 3.5 million and a GDP per capita of about US$1,160 (2011). As in many African countries, Mauritania’s recent mineral discoveries have buttressed growth and raised incomes. The mining sector has very strong potential. With more than 11 million tons exported in 2011 (valued at about US$1.5 billion), the country is the second largest African exporter of iron ore, and output is expected to increase to 18 million tons by 2015. Mauritania also exports gold and copper and has significant potential for more mineral production. In addition, Mauritania has become a modest offshore oil producer, and there are other prospects, for gas in particular. Mauritania’s waters have some of the most abundant fish stocks in the world. Industrial fishing exports 800,000 tons of fish per year and artisanal fishing catches are about 80,000 tons per year. Mauritania is also a significant livestock-producing country and has a strong potential for irrigated agriculture along the Senegal River under the regional Senegal River Basin Organization (OMVS). Mauritania’s ability to manage these resources and use the corresponding revenues in an inclusive manner will be key for its economic and social development.
Mauritania is emerging from a succession of internal shocks that deeply affected its political environment and weighed heavily on its economic performance. After a bloodless military coup in 2005 followed by a return to democracy with elections in 2006-2007, the new Government engaged in constructive dialogue with development partners. With an agenda focusing on economic governance—a clear break from earlier practices—Mauritania was granted debt relief under the Highly Indebted Poor Country Initiative (HIPC) and the Multilateral Debt Relief Initiative (MDRI), and a new Poverty Reduction and Growth Facility (PRGF) was approved by the IMF. However, in August 2008, the civilian President elected the previous year was removed from office by another military coup. The political crisis led the international community to put most of its activities in Mauritania on hold. The World Bank, in accordance with OP/BP 7.30 (Dealings with De Facto Governments), also suspended its activities, and only started reengaging in September 2009, following the successful presidential elections of July 2009, which led to the establishment of a national unity government and the lifting of international sanctions. In March 2010, the IMF approved a three-year Extended Credit Facility (ECF) agreement for about US$118.1 million. Economic recovery was discussed at the Brussels Round Table in June 2010, at which time total pledges of US$3.2 billion (including US$365 million from the World Bank Group) were made for 2010-2015.
The country nevertheless remains vulnerable to political instability. Lingering questions about the legitimacy of past elections, domestic social tensions, the rebellion in northern Mali all combine to create a high degree of political risk. The opposition of groups of African-Mauritanians to the civil census launched in 2011 has added to the tensions. The municipal and legislative elections initially scheduled for end 2011 have been postponed, but an agreement has been reached between the Government and the opposition on the creation of an independent electoral commission and more liberalization of the media.
Poverty still affects a major part of Mauritania’s population, particularly in rural areas. The main constraints to poverty reduction are the weakness of the rural economy, the dependence on capital-intensive sectors such as mining and industrial fishing, a political economy which works against the fair distribution of resources, and vulnerability to both environmental and economic shocks, which put the poor at even greater risk of food insecurity and malnutrition. In 2007, for example, rising oil and food prices directly affected the food security of about 30 percent of the population; and in 2011, the drought affected wheat production (about 55 percent below historical average), and caused significant losses of cattle, with severe wealth and income loss for farmers. In December 2011, one quarter of rural households were estimated to be food insecure, and half of these, severely so. In summary, for the poor and destitute, the stakes are high: any environmental and economic shocks can have an immediate and direct impact on their food situation.
According to the latest available poverty assessment (2008 household data), poverty declined slightly from 46.7 percent in 2004 to 42 percent in 2008, which makes the 2015 target of 25 percent difficult to reach. There are also important disparities between urban and rural areas. In rural areas, where 78 percent of the poor live, the poverty rate remained deeply entrenched at 59 percent between 2004 and 2008. In urban areas, by contrast, poverty declined from 28.9 percent to 20.8 percent. Poverty also varies significantly among regions. Extreme poverty declined modestly from 28.8 percent in 2004 to 25.9 percent in 2008. In absolute terms, the number of poor increased slightly (from 1,320,000 to 1,328,000) because of population growth. Inequality is average for Sub-Saharan Africa and similar to that in neighboring Senegal. The Gini coefficient was estimated at 0.38 in 2008, essentially the same as in 2004 (0.39). The top 20 percent of the population consumes seven times as much as the bottom 20 percent.
Mauritania’s human development index has moved up from 0.424 in 2007 to 0.453 in 2011 (compared to an average of 0.463 for sub-Saharan Africa) with Mauritania now ranking 159 out of 187 countries. The rate of population growth declined to 2.3 percent, from 2.7 percent in 2005. There has been progress in the social sectors, but overall the results in achieving MDGs have been mixed (see annex 5). MDGs regarding universal primary education and gender equality in primary education appear achievable because of the significant progress already realized in school enrollment. The primary completion rate has increased from 50 percent in 2008 to 73.1 percent in 2011 thereby increasing the demand for post-primary levels of education and training. MDGs relating to access to water are also likely to be achieved.
The most important deficiencies in progress towards achieving the MDGs are related to health, environment, employment, and some gender indicators. MDGs related to child and maternal health will not be within reach under current policies—infant-child mortality is still at 122/1000 versus a target of 45/1000, and maternal mortality is at 560 per 100,000 live births against an MDG target of 232. Only 60 percent of births are assisted, and child vaccination coverage is 64 percent. Thirty-nine percent of government spending on health goes to the tertiary level, compared to 23 percent to the primary level (where most causes of morbidity and mortality are treated) and 15 percent to the secondary level. Health expenditures at the central administrative level tripled between 2005 and 2010, while expenditures at the local level, where health services are delivered, increased by only 30 percent. Expenditures on drugs and supplies fell from 17 percent of expenditures in 2005 to 5.5 percent in 2010. Performance in the sector has been compromised by the underfunding of priority interventions (tuberculosis, malaria, reproductive health, infectious disease control, maternal and child health and nutrition), weak expenditure management, poor inter-sectoral collaboration (in water, sanitation, and nutrition), insufficient community participation, and no real strategies to stimulate demand for preventive and basic health services.
Mauritania has registered a solid recovery since 2009, in spite of a number of exogenous shocks. Overall GDP growth averaged 4.5 percent in 2010-11 and is estimated at 6.2 percent in 2012. GDP per capita in 2011 is estimated at US$1,247, making Mauritania a lower-middle income country. The rising international prices of raw materials, combined with prudent policies, helped the country to consolidate macroeconomic stability, strengthen international reserves, and increase fiscal space. The main sectors in recent growth have been construction, services and a rebound in agriculture in 2010 and 2012. However, these have been supported indirectly by mining exports which stagnated in volume terms but boomed in value terms due to rising prices for iron ore and gold. Thus the total value of exports doubled between 2009 and 2011. This contributed to a significant expansion in public revenues and spending, including major expansion plans by the state-owned mining company, SNIM. At the same time, substantial foreign direct investment has flowed in to finance further expansion in mining, a power plant and a new airport.
The overall fiscal deficit has declined significantly from 7 percent of GDP in 2008 to 1.5 percent in 2011. This trend continued in 2012, with an estimated deficit of only 0.5 percent. Expenditures rose by 6 percent of GDP due to emergency spending to address the impact of the food crisis, and make major investments in the energy and infrastructure sectors. However, this was more than offset by a large increase in grants and an increase in non-oil revenues, from 26 percent of GDP in 2011 to 29.4 percent in 2012, due part to the booming mining sector. The fiscal deficit does not include a small oil fund which remained at 1.6 percent of GDP in 2012, after a partial drawdown to help finance the emergency program.
The outlook for 2013 and the medium term is positive. GDP growth is projected to be sustained at 6.3 percent in 2013—driven by the mining industry, construction, and foreign investments—and to average 6.5 percent over the medium term (2014-2017). The non-oil fiscal deficit (including grants) is expected to average less than 2 percent over the next 5 years. There are plans to create a mining fund in addition to, and possibly merged with, the existing oil fund. Capital expenditures will remain strong in the medium term, at about 9-10 percent of GDP. Current expenditures are expected to return to more normal levels in 2013 and then fall by 5 percent of GDP by 2017, as subsidies are phased out and the wage bill is controlled. These goals may, however, prove somewhat ambitious, given current political and social tensions. A large portion of public investment over the medium term is expected to focus on energy and transport.
While Mauritania faces multiple development challenges, three major and interrelated challenges stand out: (a) lack of inclusive growth; (b) lack of competitiveness; and (c) poor governance.
Lack of inclusive growth
Lack of inclusive growth has two main aspects: First, the country’s current growth drivers—the extractive industries—are concentrating wealth at the top while producing little employment. Second, at the same time, the agriculture and fishery sectors, which account for the largest share of the workforce, are declining due to climate change, leading to an increase in food insecurity in rural areas, and to the expansion of urban slums populated with unemployable rural migrants.
Lack of competitiveness
Mauritania’s competitiveness is hampered by a small formal economic base, declining manufacturing sector, limited diversification, and a weak legal environment. By the mid-2000s, fewer than 250 formal firms of more than 5 employees were active in manufacturing/handicrafts and retail trade (World Bank 2007). Manufacturing and handicrafts accounted for 3.7 of GDP in 2011 (against around 8-9 percent in the mid-1990s), and were concentrated in Nouakchott and Nouadhibou. The narrow manufacturing base has further reinforced the dominance of large business groups, which have crowded out most SMEs. Monopolies also dominate bank credit at the expense of SMEs. In effect, most local banks behave like departments of commercial and industrial groups and deal mainly with the members of their groups; customers that do not belong to a group have difficulties in obtaining financial services. Large firms with political connections continue to dominate state procurement contracts and import markets, even in the presence of cheaper local producers. These monopolies, whether public or private, are indifferent to inflation and the exchange rate because they can pass costs on to their captive markets. At the same time, the environment remains difficult for SMEs and investors in non-monopoly sectors. Mauritania is ranked 167th out of 185 countries in terms of business environment, with serious deficiencies in terms of taxes, accessing credit, starting a business, resolving insolvency, and trading across borders.
The quality of governance in Mauritania declined significantly over the last decade, and poses a serious challenge to equitable growth and resilience to economic shocks. Governance is especially critical in the mining sector as the primary growth driver; as well as for the oversight of the economically important state-owned enterprise (SOE) sector. Governance is also key to strengthening social resilience to shocks, in particular through improved service delivery, including in the MDG areas of maternal health, child mortality, and hunger alleviation. There have been slight improvements in access to health services but the quality of health services, especially for the poor have yet to improve. Utilization rates of public health facilities, especially in the poorest areas have not increased despite the support of the World Bank and other donors. Millennium Development targets for maternal health, child mortality, and hunger alleviation, are off track. Access to electricity also remains limited, with 60% of the population estimated to use solid fuels. The existing safety nets are unable to protect the poor and neediest population. Little is known about the actual effectiveness and scope of existing safety net interventions in Mauritania. Overall, the government recognizes that general subsidies on energy products mostly benefit the rich, while the poorest households allocate less than two percent of their total spending to energy products. Current safety net programs are using different targeting mechanisms, with no coordination between Government programs and donor-lead activities, and significant leakages to the non-poor.
Last Updated: Aug 01, 2013
World Bank Engagement in Mauritania
The World Bank opened its offices in Mauritania in Nouakchott in 1986. In 1963 the Bank undertook its first development operation in the country with the financing of MIFERMA, a multinational enterprise in the mining business. This partnership has gradually broadened since 1985 and has resulted in the mobilization of substantial financial resources.
At present, the Bank’s portfolio in Mauritania includes eight IDA funded operations (including two regional projects), representing a total commitment of US$125.1 million. The IDA portfolio is complemented by a number of trust funds, for a current total committed amount of US$31.3 million.
In addition to the lending program, the Bank is engaged in a range of analytical work and technical assistance, including a recently completed ROSC on accounting and auditing, a study on land governance, technical assistance on the management of agencies and SOEs, and work on civil registries and their impact on service delivery.
In July 2007, World Bank Board of Executive Directors discussed the third World Bank Country Assistance Strategy (CAS-3) for Mauritania for the FY2008-2011 period. CAS-3 was closely aligned with the second Poverty Reduction Strategy Paper (PRSP 2), the main development policy tool designed by and with Mauritanians. CAS-3 rested on five pillars: (i) Accelerate growth and maintain macroeconomic balance, (ii) Incorporate growth into the economic environment of the poor, (iii) Develop human resources and promote widespread access to basic social services, (iv) Improve governance and capacity building, (v) Strengthen strategic supervision of programs, along with monitoring, evaluation, and coordination.
A new Country Partnership Strategy (CPS) for the period FY2013-2016 is currently under preparation. The proposed CPS is closely aligned with and supports the areas of PRSP-3. The five years of the PRSP-3 period, largely coinciding with the CPS period (2013-2016), will be a critical opportunity to deepen some of the essential reforms needed to create jobs and improve resilience in Mauritania.
IFC and MIGA Involvement
With regard to the involvement of the Multilateral Investment Guarantee Agency (MIGA) and the International Finance Corporation (IFC) in Mauritania: MIGA’s activities have mainly focused on TA in the financial sector; it has never issued coverage for any investments in Mauritania. IFC’s investments in Mauritania as of June 30, 2012, included US$12 million with two commercial banks under its Global Trade Finance Program (GTFP); and in December 2012, a two-year, US$127.5 million credit line with SG Mauritania was committed to ensure no supply interruption in the flow of energy products. In advisory services, IFC has promoted leasing as alternative source of financing under its Africa Leasing Facility, and has being contracted by the Government to structure a PPP for the development of a new container terminal in the port of Nouakchott. IFC has also pursued projects in the mining, energy, NBFI and agribusiness sectors.
The World Bank Institute (WBI) has not been that active in Mauritania to date.
Last Updated: Aug 01, 2013
The National Education Sector Development Program
The 1999 ten-year Education Sector Development Program (ESDP) sought to make education more relevant by combining the existing Arabic and French education sub-systems into one unified system. Since then, literature courses nationwide are taught in Arabic, while scientific subjects (sciences and math) are taught in French. The reform also thought to increasing access to ten years of quality basic education, and to implementing reforms in order to make secondary education, technical and vocational training and higher education more relevant and responsive to social needs and labor market demands. Following the reform, all education interventions, including the recently closed Global Partnership for Education – GPE (previously EFA-FTI) operation, were developed as part of the general framework of the ESDP and aimed at helping the government implement its education strategy and reach the Education Millennium Development Goals (MDGs).
In 2010, the Government of Mauritania decided to evaluate progress and carry out a series of diagnostic and planning exercises (Medium-Term Expenditure Framework, simulation modules, Education Country Status report,, student evaluation, teacher evaluation, bilingual evaluation etc.), which led to the preparation of an updated sector development program, covering the period 2012 – 2020 (ESDP II).
The ESDP II a sector-wide program whose overarching goals are to: (i) achieve the MDG of Universal Primary Completion; (ii) pursue educational reforms introduced as part of ESDP I; (iii) regulate and improving the relevance and quality of post-primary education to better correspond to the social and economic development needs of the country; and (iv) ensure the sustainability of actions undertaken. While most of the investment in the ESDP II will cover basic education (primary and lower secondary), the plan covers all sub-sectors of education: early childhood development (ECD), primary education, secondary education, technical and professional training, higher education, school health, literacy, and the sector management. The advantage of this comprehensive approach is that it addresses system-wide issues in a coherent and coordinated manner, defines clear priorities, and strengthens the linkages between the education sector and the economy.
The Bank Education Portfolio
The Bank is providing support through two projects: a US$ 15 million Higher Education Project and a US$ 16 million Skills Development Project. The latter is making good progress. It aims at improving the relevance and external efficiency of vocational and technical training, making the labor force more responsive to market demands and reinforcing institutional framework. A major focus of the project is to help modernize training institutes and the quality of programs. Seven technical training institutions already have negotiated performance contracts and by 2016 at least 3 programs should be certified to meet international standards. A regulatory framework for private sector training institutions will be in place, thereby increasing the supply of programs able to meet enterprise demand.
The Higher Education project has had difficulties in completing a major campus construction component before the closing date in October 30, 2013. The Government conveyed to the Bank its intention to finance the remaining civil works of the project from its own resources, and requested IDA to cancel the funds committed to civil works, and to recommit them to the Skills Development Support Project. The Bank is about to complete the cancellation processing, and will be preparing a US$ 8.0 million Additional Financing for the Skills Development Project. The Bank is also acting as Supervising Entity for the US$ 12.4 million Global Partnership for Education Fund Project under preparation. The project preparation is well advanced and its implementation is expected to start in July 2013. The project will focus on primary and lower secondary education.
Main Progress and Challenges of the Education Sector
The primary education sub-sector has experienced substantial progress over recent years. The Gross enrolment rate (GER) at the primary level increased from 82 % in 1991 to 97 % in 2011 and there are strong indications that internal efficiency is improving. Other achievements in primary education between 2001 and 2011 include: (i) gender parity reached 50.4 % (with girls being slightly more represented than boys), (ii) children attending pre-school increased from 12,056 to 14,895; (iii) retention rate increased from 44 % to 65 %; (iv) completion rate increased from 47 % to 61 %; and (v) repetition rates decreased from 15 % to 2.7 %.
But several challenges remain. They include the lack of qualified and well trained teachers and the lack of adequate lower secondary schools to provide an incentive for families to keep children, especially girls in school. Education quality is particularly challenging. Learning outcomes at all levels of the education system remain low. Standardized tests show that learning achievements at the primary level have declined and, while retention and completion rates have improved, they have not reached the Government’s 2015 goal of 79 %.
Multi-sector HIV/AIDS Control Projects
In Mauritania, the appearance of the first AIDS case in 1987 triggered efforts to combat AIDS through the establishment of a national HIV/AIDS control program, with support from the WHO. This served to step up the pace of the national response and facilitated the launch of a national planning process, which gave rise to a strategic framework to control this scourge.
The establishment in 1999 of a thematic group – UNAIDS – bolstered the multisectoral approach, which was institutionalized in 2003 with the creation of a national HIV/AIDS control committee chaired by the Prime Minister and in which eight ministerial departments are currently represented. Financing for HIV/AIDS control was mobilized by the World Bank through the Multisectoral AIDS Control Project (MAP).
Exogenous factors included, in particular, the institutional changes that took place in the country from 2005 to 2008 (coups d’état, transitional periods for preparing presidential and legislative elections, return to constitutional rule of law, then new presidential elections, etc.), resulting in a project stoppage, and the mobility of World Bank project officers. Other endogenous factors also came into play, such as problems with good governance for IDA funds and the Global Fund to Fight AIDS, Tuberculosis, and Malaria, as well as changes in project coordinators and sectoral units, resulting in an interruption of the financing and a total stoppage of project activities for 26 months.
Resumption of the AIDS control effort required, in addition to investigations commissioned by various project donors, a restructuring aimed at creating an environment more conducive to proper funds management, by means of a financial management unit that includes an administrative and financial manager, an accountant, and an internal auditor.
The Government’s commitment to fight HIV/AIDS has continued, leading to the mobilization of roughly US $1 million to cover services for persons living with HIV, SENLS and SERLS operations, and payment of project arrears.
The project’s retroactive extension for a period of 36 months, followed by resumption of project activities, provided a real opportunity to reallocate available funds and set in place a realistic action plan that is fully in line with the national strategic plan for 2011-2015 and that meets the expectations of the various sectors.
The efforts made in recent months have pinpointed progress in several different aspects of HIV/AIDS control. While the prevalence rate has held steady at under 1 percent, among risk groups it is 8 percent.
Last Updated: Aug 01, 2013
In January 2010, Mauritania’s principal external partner, the European Union, officially announced the full resumption of its cooperation, frozen since the coup d’état of August 2008. In concrete terms, this means continued implementation of new programs, totaling € 156 million, under the 10th European Development Fund (EDF) indicative program. The newly revised fishing agreements are a major element of EU-Mauritania cooperation.
On March 4 of 2010, France, the country’s leading bilateral partner (ahead of China, Germany, Japan, and Spain in particular), decided to cancel a debt of € 17.4 million on behalf of Nouakchott in the context of the “debt reduction and development contract” mechanism (contrat de désendettement et de développement: C2D).
At 83.3 percent, the country’s estimated total external debt remains viable in the medium term. Resolution of arrears with Kuwait is still a very important matter. Despite a delay, such resolution is anticipated shortly. Although the absence of an agreement with Kuwait may certainly increase the country’s vulnerability to external shocks, it would have no impact on the risk of excessive debt, which would hold steady at a moderate level in the medium term.
The United Nations System, through seven of its main agencies, is also a preferred partner in Mauritania, where it operates under the United Nations Development Assistance Framework (UNDAF). The multilateral and bilateral partnership with Gulf countries is noteworthy as well. On March 15, 2010, the Executive Board of the International Monetary Fund (IMF) approved a three-year agreement (2010-2013) in a total amount of SDR 77.28 million (roughly US $118.1 million) for the Islamic Republic of Mauritania under the Extended Credit Facility (ECF). The IMF has noted that the macroeconomic policy pursued by the Mauritanian authorities has resulted in the accumulation of substantial budget stabilizers and foreign exchange reserves. These fundamentals have enabled the economy to withstand severe droughts, a slowdown of external demand, and a spike in the price of fuel and food products. However, the IMF Executive Board recommends that emphasis be placed on structural reforms designed to promote widespread growth, reduce poverty, and diversify the economy.