Mauritania Economy

Mauritania Economy

Subchapters:

  • Basic data
  • Public finances and the state budget
  • Banking system
  • Tax System

Basic data

Mauritania has maintained GDP growth of 5% and above since 2012. In 2015, according to current data, GDP grew “only” by 3.1%. The main reason for this drop was the reduction in the prices of iron ore, which is Mauritania’s main export commodity. Another reason may be the reduction of government spending, which resulted in a reduction of the state budget deficit to 3.1%. The Covid-19 pandemic also affected the economy of Mauritania and there was a decrease of 3 percentage points. The expected growth in the following years will be related to the price of exported commodities on which Mauritania depends.

According to cheeroutdoor.com, Mauritania has long been among the low-income countries. According to World Bank data, in 2014 the country was ranked 155th in terms of GDP per capita (approx. USD 2,600/capita according to purchasing power parity). Despite the positive economic development of the last few years, Mauritania is still an underdeveloped country – in 2014, according to the Human Development Index (HDI), it was ranked 156th among 187 countries in the world. It is estimated that around 66% of Mauritanian households live below the poverty line (below US$2/day), which particularly affects the population of large rural areas. The country also faces high levels of corruption.

The main weaknesses of the Mauritanian economy are high unemployment (31%) and an insufficiently diversified economic base. The basis of the economy is fishing, cattle breeding and the mining industry. Agriculture and fisheries generate 24.1% of GDP and employ around half of the workforce, with part of this population living a nomadic lifestyle. The manufacturing industry contributes only about 8% of the GDP, on the other hand, the extraction of mineral resources creates up to 19.5% of the state’s GDP. Industry as a whole makes up 3percent of GDP. Services account for approx. 41.1% of GDP – these are mainly trade, state administration and telecommunications. erm source The Mauritanian economy is also threatened by external influences, especially drought and the volatility of world prices for some commodities. The population then finds it difficult to cope with the rise in prices (inflation was around 4% in 2015), especially for food and energy.

Pointer 2019 2020 2021 2022 2023
GDP growth (%) 5.9 -3 4.5 4.9 4.2
GDP/population (USD/PPP) 5,427.10 5,388.10 5,660.00 6,020.00 6,270.0
Inflation (%) 2.3 3.3 3.5 4.8 3.6
Unemployment (%) 10.1 10.7 10.3 10 9.8
Export of goods (billion USD) 2.3 2 4.5 4.2 3.6
Import of goods (billion USD) 4.9 4.9 5.7 6 6.3
Trade Balance (Billion USD) -0.6 -0.3 1.2 0.7 -0.1
Industrial production (% change) ON ON ON ON ON
Population (millions) 4.5 4.7 4.8 4.9 5
Competitiveness ON ON ON ON ON
OECD export risk 07.VII 07.VII 07.VII ON ON

Source: EIU, OECD, IMD

Public finance and state budget

Public finance 2021
State budget balance (% of GDP) 4.6
Public debt (% of GDP) ON
Current account balance (billion USD) 0.7
Taxes 2022
AFTER ON
F.O ON
VAT ON

The deterioration of the global economy in 2020 due to the Covid – 19 pandemic caused Mauritania’s real GDP to contract by 3.6% in 2020, after growing by 5.9% in 2019. The budget recorded a deficit of 4.1% of GDP in the year after being in surplus the previous year. Mainly due to a significant decrease in tax revenues during the economic slowdown, a decrease in export earnings and a significant increase in health spending in the fight against the pandemic. USD.

The current account deficit in the past reached a record 17.6% of GDP, which was caused by a drop in iron ore exports by up to a third and the cessation of exports of fishery products. Official foreign exchange reserves remained stable at $1.135 billion in 2020. Estimated inflation remained below the 4% target set by the monetary authorities and reached a value of 2.7%.

Banking system

The main player in monetary policy and supervision of the banking sector is the Central Bank of Mauritania. The country’s financial system also consists of 13 local banks and 5 foreign ones (e.g. Société Général, Attijari bank, Qatari QNB). 2 Mauritanian financial companies and several insurance companies and institutions specialized in microfinance are also active. However, financial services are underdeveloped and mainly serve a limited number of large companies. Small and medium-sized enterprises have very limited access to credit offers. There are few bank branches in the country, concentrated in the cities of Nouakchott and Nouadhibou. It is estimated that only less than 7% of the population has a bank account or credit. In particular, so-called Islamic banking is currently developing in the country.

Banque Centrale de Mauritania (BCM)

Avenue de l’Indépendance, BP 623 Nouakchott Tel: 00222 525.22.06 / 525.28.88 Web: www.bcm.mr E-mail: [email protected]

Banque Mauritanienne pour le Commerce International (BMCI)

Avenue Gamal Abdel Nasser, BP 622 Nouakchott Tel.: 00222 525 24 69 / 525 28 26 /+ 222 45 29 53 95 ou + 222 45 25 28 26 Web: www.bmci.mr

Banque National de Mauritania

Avenue du Roi Fayçal, BP 291 & 614 Nouakchott Tél: 00222 525 26 02/525 27 07/ 525 12 62 Web: www.bnm.mr

Société Général Mauritania

Avenue Charles De Gaulle, BP 5085 Nouakchott Tel: 00 222 45 29 70 00 Web: www.sgm.mr

Tax system

The Mauritanian tax system is quite diversified – there are 23 types of taxes divided into national and municipal taxes. The main types of taxes include:

  • Tax on industrial and commercial activity (so-called BIC) – 25% of income, payable on April 30 of each year
  • Flat-rate activity tax (so-called IMF) – 2.5% of annual turnover
  • Land tax – 6% of property ownership, 10% of property rental income
  • Income tax from dependent activity – progressive taxation according to income (0%, 5%, 15%, 25% and 33%)
  • Value added tax – basic rate 14%, 18% for hydrocarbons and telecommunications 16% ibid

Mauritania Economy