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IMF Executive Board Completes First Review of the Arrangement Under the Extended Credit Facility with the Islamic Republic of Mauritania

May 29, 2018

  • Policy implementation has been satisfactory and the program is on track. The Board’s decision enables immediate disbursement of US$ 23.5 million to Mauritania.
  • The economy is recovering, with growth estimated at 3.5 percent in 2017 and projected at 3 percent in 2018.
  • The outlook is positive, although considerable challenges remain to achieve high and inclusive growth.

On May 25, 2018, the Executive Board of the International Monetary Fund (IMF) completed the first review of the three-year arrangement with Mauritania under the Extended Credit Facility (ECF) for SDR 115.92 million (about US$ 164.4 million). The Board’s decision, which was taken on a lapse-of-time basis, [1] makes available SDR 16.56 million (about US$ 23.5 million) immediately to Mauritania.

Macroeconomic conditions are improving, as expected, along with sizable policy adjustment and favorable commodity price developments. The economy is recovering, with growth estimated at 3.5 percent in 2017 and projected at about 3 percent in 2018—with the slight slowdown due to the delayed impact of last year’s drought. Inflation is projected to remain moderate at 2.7 percent on average this year. International reserves rose to US$849 million at end-2017 (5.1 months of non-extractive sector imports) and should continue to do so this year. The primary budget balance excluding grants turned positive in 2017 at 0.3 percent of non-extractive GDP and is expected to remain in positive territory this year. The current account deficit contracted as mining and fishing exports rebounded. Borrowing slowed, with external debt levelling at 72 percent of GDP.

Policy implementation has been satisfactory and the program is on track. All end-December 2017 performance criteria and eight of the ten structural benchmarks for December 2017–March 2018 were met; the remaining two were implemented with a one-month delay. An end-April structural benchmark on repayment of the government’s liabilities to the central bank was delayed to end-June due to coordination issues. Quantitative targets for 2018 are within reach, and the authorities are committed to taking corrective actions to achieve them as needed. They will continue with sound fiscal policy and a prudent borrowing strategy, notably by avoiding non-concessional loans to ensure debt sustainability, and will press ahead with monetary, foreign exchange, and financial sector reforms. They plan to gradually expand targeted social safety nets throughout the country and step up efforts to improve the business environment and fight corruption.

The outlook is positive and the authorities are maintaining the course on policy and reform implementation, although considerable challenges remain to achieve high and inclusive growth. Vulnerabilities remain elevated and sustained reforms are needed to entrench macroeconomic stability; achieve inclusive growth that creates employment and reduces poverty; and improve the business climate and governance.

Mauritania: Selected Economic Indicators, 2015–20

Per capita GDP: US$ 1,335 (2014)

Population: 4 million (2014)

Poverty rate: 31 percent (2014)

Quota: SDR 128.8 million

2015

2016

2017

2018

2019

2020

Est.

Proj.

Proj.

Proj.

(Annual change in percent; unless otherwise indicated)

National accounts and prices

Real GDP

0.4

1.8

3.5

2.9

5.3

7.2

Real extractive GDP

-6.2

0.5

-7.0

-2.4

12.7

22.6

Real non-extractive GDP

1.4

2.0

4.9

3.5

4.5

5.3

GDP deflator

-4.1

3.4

3.3

4.9

3.6

4.9

Consumer prices (period average)

0.5

1.5

2.3

2.7

4.8

4.7

(In percent of nonextractive GDP; unless otherwise indicated)

Central government operations

Revenues and grants

32.6

31.7

31.7

32.7

32.0

32.2

Non-extractive

26.8

27.9

27.8

27.3

28.9

28.9

Taxes

16.8

18.7

19.6

19.8

20.3

20.8

Extractive

3.8

1.7

2.8

4.4

1.9

2.3

Grants

2.0

2.2

1.1

1.0

1.2

1.0

Expenditure and net lending

20.8

32.3

31.8

32.1

31.8

31.8

Current

20.6

19.0

19.3

18.9

18.8

18.9

Capital

15.6

13.3

12.4

13.0

13.0

12.9

Primary balance (excl. grants)

-4.5

-1.5

0.3

1.1

0.7

1.1

Overall balance (in percent of GDP)

-3.4

-0.5

0.0

0.5

0.1

0.4

Public sector debt (in percent of GDP) 1/

78.0

78.8

76.4

77.1

77.7

74.7

(Annual change in percent; unless otherwise indicated)

Money and Credit

Broad money

0.4

7.1

13.7

8.4

11.0

12.4

Credit to the private sector

9.7

8.1

8.9

6.9

9.2

9.6

Balance of Payments

Current account balance (in percent of GDP)

-19.8

-15.1

-14.4

-11.6

-11.3

-4.0

Excl. FDI-financed imports of extractive capital

-11.9

-11.2

-8.2

-6.4

-6.7

-1.1

Gross official reserves (in millions of US$, eop)

822.8

824.4

849.0

881.3

1,080.0

1,324.9

In months of prospective non-extractive imports

5.6

5.6

5.1

5.2

6.1

7.0

External public debt (in millions of US$) 1/

3,297.9

3,405.7

3,562.9

3,629.6

3,763.1

3,834.8

In percent of GDP

68.3

72.7

72.2

69.9

71.1

68.9

Real effective exchange rate

7.8

-5.8

-2.1

Memorandum items:

Nominal GDP (in millions of US$)

4,832.1

4,686.0

4,937.5

5,193.5

5,296.0

5,566.8

Price of iron ore (US$/Ton)

56.1

58.6

71.1

74.6

67.8

63.7

Sources: Mauritanian authorities; and IMF staff estimates and projections.

1/ Excluding passive debt to Kuwait under negotiation.


[1] The Executive Board takes decisions under its lapse-of-time procedure when it agrees that a proposal can be considered and approved without convening a formal discussion.

IMF Communications Department
MEDIA RELATIONS

PRESS OFFICER: Randa Mohamed Elnagar

Phone: +1 202 623-7100Email: MEDIA@IMF.org


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