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- GDP (PPP):
- $17.9 billion
- 2.7% growth
- 4.4% 5-year compound annual growth
- $1,128 per capita
- Inflation (CPI):
- FDI Inflow:
Mali’s economic freedom score is 56.4, making its economy the 111th freest in the 2013 Index. Its score has increased by 0.6 point from last year, mainly reflecting gains in fiscal freedom and the control of government spending that outweigh declines in investment freedom and labor freedom. Mali is ranked 17th out of 46 countries in the Sub-Saharan Africa region, and its score is below the world average.
Mali has instituted some regulatory reforms over the past year to enhance the entrepreneurial environment. In particular, it has moved to install a “one-stop” business registration system and ease the requirements for securing capital. However, these reforms have been undercut by ongoing political instability.
Overall institutional weaknesses continue to limit the economy’s dynamism and perpetuate the stagnation of economic freedom. Corruption continues to undermine the rule of law, and this is exacerbated by an inefficient judicial system that remains vulnerable to political influence. Free trade and investment have not been fully institutionalized, and tariffs and other restrictions inhibit individuals and businesses from participating efficiently in the global economy.
Mali was a one-party socialist state until 1992. Retired General Amadou Toumani Touré, head of state during the transition to democracy, was elected president in 2002 and re-elected in 2007. In March 2012, he was overthrown in a coup. Tensions continue between the government and Tuareg tribes in northern Mali over land, cultural, and linguistic rights, and the junta lacks a coherent strategy for national governance. Ansar Dine, an Islamist group affiliated with al-Qaeda in the Islamic Maghreb, holds sway in the North. Located in the heart of the Sahel, Mali is arid. Agriculture (mostly subsistence farming), livestock, and fishing in the Niger River employ 70 percent of the population and account for about a third of GDP. Cotton is a key export. Mining is growing, but mineral resources are generally underexploited, and infrastructure remains inadequate.
Mali’s already-fragile rule of law has suffered from the instability generated by the return of thousands of well-armed Tuareg fighters who had served in the security forces of former Libyan leader Muammar Qadhafi. In theory, property rights are protected and the judiciary is constitutionally independent, but Mali’s judicial system is considered notoriously inefficient and corrupted by bribery and influence-peddling.
The top income tax rate is 40 percent, and the top corporate tax rate is 35 percent. Other taxes include a value-added tax (VAT). Overall tax revenue amounts to 14.6 percent of total domestic income, and government spending has decreased to 23.2 percent of GDP. The budget has been chronically in deficit, and public debt has reached a level equal to about 30 percent of GDP.
Despite past efforts to dismantle bureaucratic hurdles to starting a business, commercial regulations have been neither implemented nor enforced effectively. Economic diversification has lagged, and much private-sector activity takes place outside of the formal economy. Labor regulations, although not fully enforced, are relatively rigid. Inflation is under control.
The trade-weighted average tariff rate is a fairly high 8.4 percent, and non-tariff barriers further increase the cost of trade. The investment regime remains severely hampered by instability and government interference. The financial sector remains underdeveloped. With financial intermediation minimal, banks lack the capacity to provide adequate access to financing. Much of the population relies on informal lending.