IMF Staff Completes the mission regarding the Second Reviews of the Arrangements under the Extended Credit Facility and the Extended Fund Facility and Concludes the First Review of the Arrangement under the Resilience and Sustainability Facility for the Islamic Republic of Mauritania
IMF News, March 8, 2024
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- IMF Staff Completes the mission regarding the Second Reviews of the Arrangements under the Extended Credit Facility and the Extended Fund Facility and Concludes the First Review of the Arrangement under the Resilience and Sustainability Facility for the Islamic Republic of Mauritania
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Bibliographic details
- Published: March 8, 2024
Mission scope and timeline
- Mission led by Mr. Felix Fischer held discussions with the Mauritanian authorities in Nouakchott from February 26 to March 7, 2024.
- Objective: second reviews of the programs supported by the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) arrangements; first review of the program under the Resilience and Sustainability Facility (RSF) arrangement.
- End-of-mission statement clarifies views are those of IMF staff and do not necessarily represent the IMF Executive Board; the mission will not result in a Board discussion.
Agreed financing and disbursements (subject to IMF Management and Executive Board approval)
- Total initial disbursement tied to the reviews: about SDR 21.3 million (about [28.4] million dollars).
- Breakdown:
- SDR 6.44 million (about 8.58 million dollars) under the ECF and EFF arrangements.
- SDR 14.86 million (about 19.79 million dollars) under the RSF arrangement.
Recent macroeconomic performance and indicators
- Real GDP growth:
- 2024 growth expected to reach 4.3 percent.
- 2023 growth was 3.4 percent.
- Growth in 2024 driven by the performance of the non-extractive sector.
- Inflation:
- 2.6 percent in February 2024.
- 9 % in February 2023.
- Decline reflects the downturn in commodity prices and monetary policy tightening.
- Fiscal and external balances:
- Non-extractive primary balance, including grants, at end-2023: -5.3 percent of GDP (compared to -7.6 percent in 2022).
- Current account deficit (preliminary data) expected to decrease to 9.8 percent of GDP in 2023 (compared to 16.7 percent at end-2022).
- International reserves stabilized at 2.0 billion dollars in 2023.
Program implementation and structural reforms
- Performance in IMF-supported programs under the ECF/EFF arrangements is on track and implementation has been satisfactory (based on preliminary data).
- Most structural benchmarks already implemented. Notable implementations:
- Small and Medium Enterprises (SME) guarantee fund operational.
- Tax policy unit operational.
- RSF-related reform for first program review (targeted for end-April 2024) is being implemented and includes:
- Adoption of a decree to make cash transfers to vulnerable households permanent.
- Extension of the social safety nets program in response to droughts to include all affected low-income households while guaranteeing its financing.
Risks, vulnerabilities, and scenarios
- Downside risks highlighted:
- Escalation of geopolitical tensions leading to new terms of trade shocks.
- More frequent climate disasters causing deterioration in infrastructure, arable lands, and agricultural production, and keeping food insecurity relatively high.
- Further delays in the start of the Greater Tortue Ahmeyim (GTA) gas project and adverse commodity price fluctuations could lower fiscal revenue, increase external financing needs, and worsen the medium-term debt profile.
- Upside scenario:
- Implementation of future phases of the GTA project or other major mining projects could improve economic growth and the balance of payments.
Closing remarks from the mission
- IMF team expressed thanks to the Mauritanian authorities and counterparts for the warm welcome, constructive discussions, and excellent cooperation.
Press Release No. 24/76 — March 8, 2024