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

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Via IMF (Den Internationale Valutafond)

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







May 20, 2019











  • Mauritania’s performance continued to be strong and growth is projected to accelerate to 6.7 percent in 2019.
  • The program aims at entrenching macroeconomic stability, supporting inclusive and job-creating growth, and building international reserve buffers.
  • The authorities plan to use the prospective fiscal space prudently for priority social spending—education, health, and social protection—and public infrastructure.

On May 20, 2019, the Executive Board of the International Monetary Fund
(IMF) completed the third review of the three-year arrangement with
Mauritania under the Extended Credit Facility. The arrangement, with total
access of SDR 115.92 million (about US$ 159.8 million at current exchange
rates), or 90 percent of Mauritania’s quota, was approved on December 6,
2017 (see Press Release No. 17/468). The completion of the review allows
the authorities to draw SDR 16.56 million (about US$ 22.8 million),
bringing total disbursements to SDR 66.24 million (about US$ 91.3 million).

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

“Mauritania’s performance under the Extended Credit Facility Arrangement
continues to be strong. Macroeconomic stability has been maintained,
external debt-to-GDP declined, official reserves increased, and some fiscal
space has been created. Structural reform implementation progressed as
planned.

“Economic growth picked up to an estimated 3.6 percent in 2018 and is
projected to accelerate to 6.7 percent this year, supported by continued
broad-based non-extractive growth reflecting strong domestic demand and
nascent diversification.
The outlook has improved, buoyed by more favorable terms of trade and
the upcoming development of a large offshore gas field. Nevertheless,
downside risks related to global economic developments, commodity price
volatility, adverse weather, and regional security concerns remain
elevated.

“In the context of an uncertain global environment, the program aims at
entrenching macroeconomic stability, supporting inclusive and job-creating
growth, and building international reserve buffers.
The authorities plan to use the prospective fiscal space prudently for
priority social spending—education, health, and social protection—and
public infrastructure,
and to seek financing on concessional terms to improve debt sustainability.

“To support these objectives, the authorities’ program envisages continued
policy discipline accompanied by broad-based structural reforms. Priorities
include strengthening tax policy and administration to ensure broad-based
tax compliance and reforming budget processes to improve the effectiveness
of public spending. Modernizing the foreign exchange policy framework and
increasing exchange rate flexibility will help to address external shocks
and preserve official reserves, while activating the new monetary policy
instruments will improve liquidity management. Upgrading bank regulatory
standards and supervision will strengthen banking sector soundness and
financial inclusion. The authorities are also committed to establishing a
robust macro-fiscal framework to efficiently manage future windfall gas
revenues.

“Going forward, it will be important to step up efforts to improve the
business environment, strengthen economic governance, and fight
corruption.”



Mauritania: Selected Economic Indicators, 2015–20

2015

2016

2017

2018

2019

2020

Est.

Proj.

Proj.

(Annual change in percent)

National accounts and prices

Real GDP

0.4

1.8

3.1

3.6

6.7

5.8

Real extractive GDP

-5.6

0.7

-7.1

-18.7

20.6

6.3

Real non-extractive GDP

1.4

2.0

4.5

6.3

5.4

5.8

GDP deflator

-4.2

3.4

3.4

2.8

5.3

3.1

Consumer prices (period average)

0.5

1.5

2.3

3.1

3.6

4.0

(In percent of non-extractive GDP; unless otherwise
indicated)

Central government operations

Revenues and grants

32.6

31.7

31.8

33.6

30.5

31.2

Non-extractive

26.8

27.9

27.9

28.2

27.5

27.7

Taxes

16.9

18.7

19.7

20.8

20.4

20.7

Extractive

3.8

1.7

2.8

4.7

2.2

2.6

Grants

2.0

2.2

1.1

0.7

0.8

0.9

Expenditure and net lending

37.2

32.3

31.9

30.0

30.6

30.7

Current

20.6

19.0

19.6

19.1

18.1

18.0

Capital

15.8

13.3

12.3

10.8

12.4

12.8

Primary balance (excl. grants)

-4.5

-1.5

0.3

4.8

0.9

1.1

Overall balance (in percent of GDP)

-3.4

-0.5

0.0

3.3

0.0

0.5

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

75.2

77.4

75.9

83.0

78.5

80.9

(Annual change in percent; unless otherwise indicated)

Money and Credit

Broad money

0.4

7.1

13.7

13.8

11.5

11.6

Credit to the private sector

9.7

8.1

7.5

19.2

13.5

13.7

Balance of Payments

Current account balance (in percent of GDP)

-19.8

-15.1

-14.4

-18.4

-15.7

-21.6

Excl. externally financed extractive capital imports

-9.6

-9.6

-7.4

-11.4

-10.2

-12.9

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

822.8

824.4

849.0

919.1

1,010.6

1,133.8

In months of prospective non-extractive imports

5.6

5.5

4.6

5.0

5.2

5.7

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

3,208.6

3,354.9

3,573.0

3,631.8

3,784.0

4,046.4

In percent of GDP

66.4

71.6

72.5

69.3

67.3

69.4

Real effective exchange rate

7.8

-5.8

-2.1

-0.8

Memorandum items:

Nominal GDP (in millions of US$)

4,830.5

4,685.6

4,925.1

5,237.1

5,621.3

5,826.9

Price of iron ore (US$/Ton)

56.1

58.6

71.1

70.1

76.5

70.2

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 Kuwait under negotiation.

3/ Excluding the hydrocarbon revenue fund.

IMF Communications Department
MEDIA RELATIONS

PRESS OFFICER: Randa Elnagar

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






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