Via IMF (Den Internationale Valutafond)

IMF Executive Board Completes Fifth Review Under the Extended Credit Facility Arrangement for the Islamic Republic of Mauritania, Approves Augmentation and US$52 Million Disbursement







September 2, 2020











  • The COVID-19 pandemic continues to impose severe health, social, and economic hardships in Mauritania, with a 3.2 percent contraction of output expected in 2020.
  • The authorities have responded swiftly to the shock with measures to contain the pandemic and alleviate its economic fallout. They are prioritizing health spending and targeted support to the most vulnerable households and sectors in the economy.
  • The IMF’s support will provide additional resources to mitigate the pandemic’s socio-economic impact and continue with institutional reforms to foster an inclusive recovery.

Washington, DC: Today, the Executive Board of the International Monetary Fund (IMF)
completed the fifth review under the three-year Extended Credit Facility
(ECF) arrangement for the Islamic Republic of Mauritania. The arrangement
was approved on December 6, 2017 with total access of SDR 115.92 million
(about US$164 million at current exchange rates), or 90 percent of
Mauritania’s quota (see Press Release No. 17/468). In completing today’s
review, the Board also approved the authorities’ request for an
augmentation of access of SDR 20.24 million (about US$28.7 million or 15.7
percent of quota) to address higher-than-anticipated financing needs
stemming from the COVID-19 pandemic. The augmentation brings total access
under the ECF arrangement to SDR 136.16 million (about US$193 million or
105.7 percent of quota). The completion of this review allows Mauritania to
draw SDR 36.80 million (about US$52.2 million or 28.6 percent of quota).

Earlier this year, the authorities had requested emergency support under
the IMF’s Rapid Credit Facility (RCF) to help address Mauritania’s urgent
balance of payments need due to the COVID-19 pandemic. On April 23, 2020,
the IMF’s Executive Board approved the disbursement of SDR 95.680 million
(about US$130 million at the time or 74.3 percent of quota), thereby
providing space to increase spending on health services and social
protection programs and helping to catalyze additional donor support (Press
Release No. 20/186).

Following the Executive Board discussion, Mr. Mitsuhiro Furusawa, Deputy
Managing Director and Acting Chair, made the following statement:

“The COVID-19 pandemic continues to impose severe human, economic, and
social hardships in Mauritania. Economic activity has slowed down sharply
and the outlook has weakened. The overall budget deficit could widen
significantly, giving rise to large balance of payments and fiscal
financing needs. Risks are tilted to the downside given risks of a more
protracted global and domestic COVID-19 outbreak.

“Despite the difficult environment, performance under the ECF-supported
program has been strong. The authorities are implementing prudent economic
policies and advancing with reforms, albeit with some delays, to ensure
macroeconomic stability, foster an inclusive recovery, and reduce
inequalities and poverty. Their swift response to contain and mitigate the
effects of the pandemic is welcome. Prioritizing health spending and
targeted support to the most vulnerable households and sectors of the
economy should continue. The temporary loosening of the policy stance is
justified and implementation of the national COVID-19 response plan should
proceed expeditiously within the 2020 supplementary budget. The central
bank has eased monetary conditions and should continue to monitor banking
sector soundness. The authorities are committed to full transparency and
reporting of resources deployed for the emergency response and to
publishing procurement contracts, auditing crisis-mitigation spending as
soon as possible, and publishing those results.

“The authorities’ continued commitment to the medium-term objectives of the
economic reform program supported by the ECF arrangement is welcome. The
program aims at creating fiscal space by mobilizing domestic revenues and
strengthening public financial management with a view to increasing
priority spending on education, health, social protection, and
infrastructure while maintaining prudent borrowing policies. The
authorities should return to primary budget surpluses as soon as conditions
normalize to ensure debt sustainability, given the high risk of debt
distress.

“The IMF’s continued financial assistance, along with other financing from
the international community, will help Mauritania respond effectively to
the COVID-19 crisis by providing space to increase spending on health
services and social protection programs. Further external support will be
needed to close prospective financing needs next year.”



Mauritania: Selected Economic indicators, 2017–21

Poverty rate: 31 percent (2014)

Quota: SDR 128.8 million

Population: 4.4 million (2018)

Main exports: iron ore, fish, gold

2017

2018

2019

2020

2021

Est.

Proj.

(Annual change in percent; unless otherwise indicated)

National accounts and prices

Real GDP

3.5

2.1

5.9

-3.2

2.0

Real extractive GDP

-6.2

-9.5

27.2

-2.7

2.3

Real non-extractive GDP

4.7

3.5

3.6

-3.3

2.0

GDP deflator

3.7

1.8

4.7

5.5

4.1

Consumer prices (period average)

2.3

3.1

2.3

3.9

4.5

(In percent of nonextractive GDP; unless otherwise
indicated)

Central government operations

Revenues and grants

22.8

25.0

24.3

20.7

22.0

Nonextractive

20.0

21.0

20.5

18.6

20.0

Taxes

14.1

15.5

14.9

12.7

14.7

Extractive

2.0

3.5

1.9

1.5

1.6

Grants

0.8

0.5

1.9

0.6

0.4

Expenditure and net lending

22.9

22.3

21.8

25.2

23.0

Current

14.0

14.3

13.7

16.7

14.3

Capital

8.8

8.1

8.1

8.5

8.7

Primary balance (excl. grants)

0.2

3.5

1.7

-3.6

0.0

Overall balance (in percent of GDP)

0.0

2.5

2.1

-3.8

-0.8

Public sector debt (in percent of GDP) 1/ 2/

55.1

61.4

58.1

65.8

66.1

(Annual change in percent; unless otherwise indicated)

Money and Credit

Broad money

13.7

13.8

11.8

2.1

7.8

Credit to the private sector

7.5

19.4

12.9

4.3

10.0

Balance of Payments

Current account balance (in percent of GDP)

-10.0

-13.8

-10.6

-17.3

-18.5

Excl. externally financed extractive capital imports

-5.0

-8.6

-3.6

-12.2

-12.6

Gross official reserves (in millions of US$, eop) 3/

849

918

1,135

1,135

1,134

In months of prospective non-extractive imports

4.6

4.4

5.3

5.1

5.0

External public debt (in millions of US$) 2/

3,573

3,614

3,710

4,164

4,282

In percent of GDP

52.7

51.3

48.8

56.1

56.7

Real effective exchange rate

-2.1

-0.3

1.6

Memorandum items:

Nominal GDP (in millions of US$)

6,784

7,048

7,600

7,428

7,554

Price of iron ore (US$/Ton)

71.1

70.1

93.6

77.0

75.0

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

1/ Including government debt to the central bank recognized
in 2018.

2/ Excluding passive debt to the central bank recognized in
2018.

3/ Excluding hydrocarbon revenue fund.

IMF Communications Department
MEDIA RELATIONS

PRESS OFFICER: Nadya Saber

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

@IMFSpokesperson








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