China
Europe
Canada
Japan
Australia
United Arab Emirates
MoroccoEconomic growth driven by extractive projects
Economic growth improved in 2024, albeit at a slower pace than expected with the launch of production from the offshore gas field, which was eventually postponed. The country was then able to rely on the non-extractive sector, notably fishing, which alone accounts for 19% of exports. By 2025, economic acceleration is expected to come from minerals and gas. The joint offshore gas extraction project with Senegal, Grand Tortue Ahmeyim (GTA), signed in 2018, is expected to produce 2.3 tons of LNG a year from the end of 2024, with Mauritania receiving 5% of the revenues. LNG will contribute to national electricity production and exports. In addition to the energy sector, Mauritania will benefit from the production of gold (37% of exports, from the Tasiast mine) for which prices are high, and iron ore (the second-largest producer in Africa).
However, while the outlook for mining is favourable, growth will remain vulnerable to climatic shocks, with agriculture accounting for 23% of GDP, to depleting fish stocks, and to a potential further delay in the GTA project. The latter could curb foreign investment, while domestic investment, both private and public, will continue to be dented by poor governance (corruption, etc.) and fiscal consolidation. However, the Extended Fund Facility and Extended Credit Facility signed with the IMF, political stability, and large untapped mineral and energy reserves should more than offset these risks, thereby keeping foreign interest alive. European, Australian and Arab-nation companies have extractive and energy projects, such as the Tiris uranium mine, for which Australia's Aura Energy received the final construction and operating licence in July 2024. Private consumption (over 50% of GDP) will be supported by inflation stabilising at a lower level than in 2022 and 2023. Prices of oil and food, the country’s two main import items, should ease.
Gas exports reduce twin deficits
The public deficit will continue to fall in 2025. In fact, the government will continue to consolidate the budget within the framework of agreements with the IMF, in particular thanks to increasing non-extractive revenues (by abolishing tax exemptions and improving collection via online tax returns) and extractive revenues (gold and gas, etc.). The government will continue to implement fiscal consolidation reforms such as the gradual phasing-out of fuel subsidies, as suggested by the IMF, with which it has three agreements. First, Mauritania has had an Extended Credit Facility since January 2023 and an Extended Fund Facility approved in January 2023, for a period of 42 months and for a total of USD 86.9 million. Subsequently, in December 2023, the Fund granted a USD 258.21 million Resilience and Sustainability Facility to be disbursed over 31 months. The country has already received USD 80 million under these three programmes. They will catalyse additional financing, in particular concessional external loans. External public debt will consequently represent more than 40% of GDP, or almost 85% of total public debt. Mauritania's two main creditors will remain the Arab Fund for Economic and Social Development and Saudi Arabia, accounting for 25.7% and 14.3% of public debt, respectively, at the end of 2023.
The large current account deficit should continue to decline, mainly on back of growth in gas exports exceeding that of imports of services. Nevertheless, the trade balance will remain negative (-7.0% of GDP in 2023), with a weaker performance from non-energy exports (fish, in particular). It will, however, benefit from lower oil and food prices, which account for 35% and 23% of total imports respectively. The services deficit (-6.0% of GDP in 2023) will continue to widen due to investment in the extractive sector that is pushing the high import bill wider. The deficit will be financed mainly by FDI and official medium- and long-term borrowing.
President Ghazouani re-elected in the first round
On 29 June 2024, incumbent President Mohamed Ould Ghazouani was re-elected for a second and final term (as per the Constitution), winning 56% of the vote. The results were contested by the divided opposition, while post-election unrest led to the deaths of three people. The country is regularly affected by social unrest related to ethnic discrimination (at the expense of the Harratin community), high unemployment (10%) and low living standards. However, his re-election should not threaten political stability as former General Ghazouani has the support of the armed forces. Furthermore, the presidential party El Insaf holds a parliamentary majority, having won 107 of the 176 seats in the May 2023 legislative elections.
Externally, instability and the jihadist presence in other Sahelian countries where coups d'état have taken place, not to mention the conflict between Morocco and the Polisario in Western Sahara, are likely to exacerbate the flow of refugees to Mauritania. However, the country has not suffered any jihadist attacks since 2011 and remains free from violence thanks to investments in defence, security and intelligence. Still on the regional front, the launch of the joint offshore gas development project with Senegal has so far eased bilateral tensions over fishing rights along their maritime border.
Ties with other Arab countries, notably Saudi Arabia and the United Arab Emirates, will also continue to be strengthened through financing and investment, particularly in green hydrogen, as well as the development of trade links. Nevertheless, despite a slowdown in demand, China will remain Mauritania's main customer with purchases of copper, iron and fishery products. Last, the country will maintain its ties with the EU and the US, both of which are interested in the country's energy potential and geographical location. In January 2024, the US reinstated the trade preferences granted to Mauritania under the AGOA (African Growth and Opportunity Act) which had been suspended in 2019 due to concerns over workers' rights. Also in 2024, the country signed a joint declaration with the European Union strengthening the partnership on migration, accompanied by a EUR 210 million package. It also reached agreement with Spain on joint management of migratory flows to the Canary Islands.
