IMF Executive Board Completes Fifth Review Under the Extended Credit Facility Arrangement for the Islamic Republic of Mauritania, Approves Augmentation and US$52 Million Disbursement

IMF News, September 2, 2020

Source details

Canonical URL: IMF Executive Board Completes Fifth Review Under the Extended Credit Facility Arrangement for the Islamic Republic of Mauritania, Approves Augmentation and US$52 Million Disbursement

The three-year Extended Credit Facility (ECF) arrangement was approved on December 6, 2017 with total access of SDR 115.92 million (about US$164 million at current exchange rates), or 90 percent of Mauritania’s quota.
The Executive Board approved an augmentation of access of SDR 20.24 million (about US$28.7 million or 15.7 percent of quota) to address higher-than-anticipated financing needs stemming from the COVID-19 pandemic.
The augmentation brings total access under the ECF arrangement to SDR 136.16 million (about US$193 million or 105.7 percent of quota).
The completion of the fifth review allows Mauritania to draw SDR 36.80 million (about US$52.2 million or 28.6 percent of quota).
Earlier in 2020, on April 23, 2020, the IMF’s Executive Board approved the disbursement of SDR 95.680 million (about US$130 million at the time or 74.3 percent of quota) under the Rapid Credit Facility (RCF) to address urgent balance of payments needs.

The COVID-19 pandemic continues to impose severe health, social, and economic hardships in Mauritania, with a 3.2 percent contraction of output expected in 2020.
The authorities have prioritized health spending and targeted support to the most vulnerable households and sectors.
Risks are tilted to the downside given risks of a more protracted global and domestic COVID-19 outbreak.
The IMF’s financial assistance, together with other financing from the international community, will help provide space to increase spending on health services and social protection programs; further external support will be needed to close prospective financing needs next year.
The authorities aim to create fiscal space by mobilizing domestic revenues and strengthening public financial management to increase priority spending on education, health, social protection, and infrastructure while maintaining prudent borrowing policies.
Given the high risk of debt distress, the authorities should return to primary budget surpluses as soon as conditions normalize to ensure debt sustainability.

Performance under the ECF-supported program has been strong; the authorities are implementing prudent economic policies and advancing with reforms, albeit with some delays.
Prioritize health spending and targeted support to the most vulnerable households and sectors of the economy.
The temporary loosening of the policy stance is justified; implementation of the national COVID-19 response plan should proceed expeditiously within the 2020 supplementary budget.
The central bank has eased monetary conditions and should continue to monitor banking sector soundness.
The authorities are committed to full transparency and reporting of resources deployed for the emergency response and to publishing procurement contracts, auditing crisis-mitigation spending as soon as possible, and publishing those results.

National accounts and prices (Annual change in percent; unless otherwise indicated)

Real GDP: 2017: 3.5; 2018: 2.1; 2019: 5.9; 2020 Est.: -3.2; 2021 Proj.: 2.0
Real extractive GDP: 2017: -6.2; 2018: -9.5; 2019: 27.2; 2020 Est.: -2.7; 2021 Proj.: 2.3
Real non-extractive GDP: 2017: 4.7; 2018: 3.6; 2019: -3.3
GDP deflator: 2017: 3.7; 2018: 1.8; 2019: 5.5; 2020 Est.: 4.1
Consumer prices (period average): 2017: 3.1; 2018: 3.9; 2019: 4.5

Central government operations (In percent of nonextractive GDP; unless otherwise indicated)

Revenues and grants: 2017: 22.8; 2018: 25.0; 2019: 24.3; 2020 Est.: 20.7; 2021 Proj.: 22.0
Nonextractive: 2017: 20.0; 2018: 21.0; 2019: 20.5; 2020 Est.: 18.6
Taxes: 2017: 14.1; 2018: 15.5; 2019: 14.9; 2020 Est.: 12.7; 2021 Proj.: 14.7
Extractive: 2017: 1.9; 2018: 1.5; 2019: 1.6
Grants: 2017: 0.8; 2018: 0.5; 2019: 0.6; 2020 Est.: 0.4
Expenditure and net lending: 2017: 22.9; 2018: 22.3; 2019: 21.8; 2020 Est.: 25.2; 2021 Proj.: 23.0
Current: 2017: 14.0; 2018: 14.3; 2019: 13.7; 2020 Est.: 16.7
Capital: 2017: 8.8; 2018: 8.1; 2019: 8.5; 2020 Est.: 8.7
Primary balance (excl. grants): 2017: 0.2; 2018: 1.7; 2019: -3.6; 2020 Est.: 0.0
Overall balance (in percent of GDP): 2017: 2.5; 2018: -3.8; 2019: -0.8

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

Money and Credit

Broad money: 2017: 13.8; 2018: 11.8; 2019: 7.8
Credit to the private sector: 2017: 7.5; 2018: 19.4; 2019: 12.9; 2020 Est.: 4.3; 2021 Proj.: 10.0

Balance of Payments

Current account balance (in percent of GDP): 2017: -10.0; 2018: -13.8; 2019: -10.6; 2020 Est.: -17.3; 2021 Proj.: -18.5
Excl. externally financed extractive capital imports: 2017: -5.0; 2018: -8.6; 2019: -12.2; 2020 Est.: -12.6
Gross official reserves (in millions of US$, eop) 3/: 2017: 849; 2018: 918; 2019: 1,135; 2020 Est.: 1,134
In months of prospective non-extractive imports: 2017: 4.6; 2018: 4.4; 2019: 5.3; 2020 Est.: 5.1; 2021 Proj.: 5.0
External public debt (in millions of US$) 2/: 2017: 3,573; 2018: 3,614; 2019: 3,710; 2020 Est.: 4,164; 2021 Proj.: 4,282
External public debt (In percent of GDP): 2017: 52.7; 2018: 51.3; 2019: 48.8; 2020 Est.: 56.1; 2021 Proj.: 56.7
Real effective exchange rate: 2017: -2.1; 2018: -0.3; 2019: …

Memorandum items:

Nominal GDP (in millions of US$): 2017: 6,784; 2018: 7,048; 2019: 7,600; 2020 Est.: 7,428; 2021 Proj.: 7,554
Price of iron ore (US$/Ton): 2017: 71.1; 2018: 70.1; 2019: 93.6; 2020 Est.: 77.0; 2021 Proj.: 75.0

IMF Communications Department press release, September 2, 2020.