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- GDP (PPP):
- $8.2 billion
- 6.7% growth
- 4.1% 5-year compound annual growth
- $2,218 per capita
- Inflation (CPI):
- FDI Inflow:
Mauritania’s economic freedom score is 53.3, making its economy the 135th freest in the 2015 Index. Its score is essentially unchanged from last year, with improvements in business freedom, freedom from corruption, and monetary freedom offset by declines in fiscal freedom and labor freedom and a collapse in the control of government spending. Mauritania is ranked 28th out of 46 countries in the Sub-Saharan Africa region, and its overall score is below the world and regional averages.
Mauritania’s trend in economic freedom has been characterized by alternating years of advances and losses, but the overall change has been positive over the past five years. Since 2011, economic freedom has improved by over 1.0 point. A double-digit improvement in investment freedom has led advances concentrated in four of the 10 economic freedoms.
The modest gain in overall economic freedom has occurred despite a weak institutional framework that has yet to experience measureable reform. Corruption remains endemic, and political instability has undermined society’s basic institutions. The judicial system’s lack of independence makes it vulnerable to political influence. Mauritania scores below the global average in all policy areas of open markets measured by trade freedom, investment freedom, and financial freedom.
A military junta ruled the former French colony of Mauritania from 1978 until 1992, when the first multi-party elections were held. In 2008, General Mohamed Ould Abdel Aziz overthrew President Sidi Ould Cheikh Abdallahi. Aziz won elections in July 2009 and again in June 2014, but opposition groups boycotted the elections. There are recurring ethnic tensions within the mixed population of Moors and black Africans. Mauritania faces the growing threat of al-Qaeda terrorists in the Islamic Maghreb who have kidnapped and killed several foreigners. Mining and fishing dominate the economy. Mauritania is one of Africa’s newest oil producers, and offshore gas production is expected to begin in 2015.
Corruption is a serious problem. In recent years, for the first time, several senior officials have been charged with corruption, but either these cases have been dismissed or officials have been ordered to reimburse the government for the amount they supposedly embezzled with no further legal consequences. The judicial system is chaotic, corrupt, and heavily influenced by the government.
Mauritania’s top individual income tax rate is 30 percent, and its top corporate tax rate is 25 percent. Other taxes include a value-added tax. Taxes consume about 21.3 percent of gross domestic product, and government expenditures amount to about 36.6 percent of domestic output. Government debt equals approximately 88 percent of the size of the domestic economy.
The regulatory environment remains burdensome. The minimum capital required to launch a business is about three times the level of average annual income, and completing licensing requirements takes over 100 days. The labor market remains underdeveloped. The government has acknowledged the need to shrink the public sector and reduce food and fuel subsidies but has yet to act.
Mauritania’s average tariff rate is 10.1 percent. Customs procedures have been improved, but importing goods can still be time-consuming. The slow-moving court system may deter foreign investment. Commercial banks, regulated by the central bank, dominate the small financial sector, and diversification remains limited. Less than 5 percent of the population has access to banking services.