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- GDP (PPP):
- $7.7 billion
- 6.4% growth
- 3.5% 5-year compound annual growth
- $2,122 per capita
- Inflation (CPI):
- FDI Inflow:
Mauritania’s economic freedom score is 53.2, making its economy the 134th freest in the 2014 Index. Its score has increased by 0.9 point since last year, with improvements in six of the 10 economic freedoms including investment freedom, trade freedom, and labor freedom. 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 has advanced its economic freedom score by nearly 8 points over the 19 years during which it has been graded in the Index. It has improved notably in the area of market openness as assessed by trade freedom, investment freedom, and financial freedoms. Rated “moderately free” in 2005, Mauritania’s economy has since fallen back to “mostly unfree.”
Although the Mauritanian economy has expanded its limited productive base, it suffers from serious institutional weaknesses, and growth remains fragile. Court enforcement of property rights is subject to pervasive political interference. Corruption and a lack of transparency increase uncertainty and risk.
A military junta ruled 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, but popular discontent threatened his parliamentary alliance in the run-up to elections scheduled for October 2011, which were repeatedly postponed. There are recurring ethnic tensions within the mixed population of Moors and black Africans. Aziz sustained injuries from an accidental shooting by his own troops in October 2012 but has continued to maintain his authority. Mining and fishing dominate the economy. Offshore oil production began in 2006, but substantial economic gains have been slow to materialize. Mauritania faces the growing threat of terrorism, drought, and poor harvests. Formal-sector unemployment is persistently high.
Corruption is a serious problem, and political instability has undermined fiscal transparency. Several senior officials were charged with corruption for the first time in recent years, but either the cases were dismissed or the officials were ordered to reimburse the government for the amount they supposedly embezzled with no further legal ramifications. The chaotic and corrupt judicial system is heavily influenced by the government.
The top individual income tax rate has been reduced to 30 percent, and the top corporate tax rate remains 25 percent. Other taxes include a value-added tax (VAT). The overall tax burden is 17.5 percent of gross domestic income. Public expenditures are 28 percent of GDP. Government debt continues to fall and has reached a level equal to about 80 percent of the domestic economy.
Launching a business takes nine procedures and 19 days, but completing licensing requirements takes more than two months and remains costly. The absence of a well-functioning labor market has led to chronically high unemployment and severe underemployment. The government has acknowledged the need to shrink the public sector and reduce food and fuel subsidies, but no steps have been taken.
Mauritania’s average tariff rate is 8 percent. Imports of some goods may require “special authorization.” The legal system moves slowly, which can discourage foreign investment. Limited access to credit and the high costs of financing continue to impede entrepreneurial activity. Progress in modernizing the financial sector has been sluggish and limited. The banking sector dominates the financial system.