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IV. TRADE POLICIES by SECTOR (1) 1. Mauritania Is a Country with A Mauritania WT/TPR/S/103 Page 55 IV. TRADE POLICIES BY SECTOR (1) INTRODUCTION 1. Mauritania is a country with a rural, mainly livestock economy, with the addition, since independence, of mining and fishing and, to a lesser extent, manufacturing.1 2. The structure of Mauritanian production has remained relatively stable. The traditional sectors continue to dominate the economy in terms of contribution to GDP and employment (chart IV.1). The agricultural sector accounts for about 18 per cent of GDP (nearly 14 per cent from livestock-raising alone) and employs about 60 per cent of the labour force. Agriculture continues to be the second largest contributor to GDP after services, but since the 1980s its importance has decreased, due mainly to the decline in herding. The contribution of the services sector rose from 42.2 per cent of GDP in 1990 to 49.9 per cent in 2001 (including non-market services provided by Government, whose share of GDP fell from 12.9 to 10.7 per cent). 3. The dominant sectors in terms of exports and contributions to the budget are fishing and mining, which alone account for almost 100 per cent of exports and contribute about 40 per cent of Government revenue. At the same time, they make only a minor contribution to GDP (4.2 and 12.8 per cent, respectively). Small-scale fishing represented only 1.2 per cent of GDP in 2001. 4. Manufacturing industry, which consists mainly of the agri-food and chemical industries, is relatively recent and is contributing about 4.2 per cent of GDP. Almost all of its production is consumed locally. 5. In agriculture, after having followed a policy of self-sufficiency, in the 1990s the Government began liberalizing the sector: the State enterprise SOMINEX lost its import monopoly, export taxes and the import quota linking rice imports with the purchase of local rice were abolished and agricultural credit, formerly reserved mainly for rice production, was made available for other crops. The Government's priority in the sector remains food security. 6. Since 1994, the fisheries sector has been gradually liberalized. As Mauritania's coastal waters are considered to be among the richest in the world, the sector is attracting numerous foreign economic partners. Nevertheless, the development of the sector is encountering a number of constraints, such as the overexploitation of certain resources and the ageing of the fleet. In 2000, to improve the management of the sector, the Government adopted a new Fisheries Code aimed at promoting small-scale coastal fishing, which creates jobs and is considered to be more resource- friendly. 1 There is an informal sector which plays an important part in creating jobs. According to a study carried out jointly by the Government, UNDP and ILO, in 1995 the urban informal sector employed about 170,000 people as compared with 41,000 in structured employment. It consists of small and micro enterprises operating in the retail trade, the services sector and the craft industries ("Mauritanie" 1998), Marchés tropicaux et méditerranéens, special issue, March). WT/TPR/S/103 Trade Policy Review Page 56 Chart IV.1 GDP by sector, 1990-2001 Percentage 1990 2001 Horticulture Horticulture Indirect taxes 3.7 Indirect taxes 3.5 10.2 10.0 Livestock Livestock 14.1 21.4 Other Other Small-scale services services fishing 18.7 16.1 1.2 Small-scale Mines fishing 12.8 0.8 Shops, hotels Mines Shops, hotels and restaurants Fishing 12.4 and restaurants 17.7 Industry 12.9 Fishing 4.2 industry Other 5.0 Construction manufacturing Transport and Construction Transport and Other and public industries telecommunications and public telecommunications manufacturing works 4.2 5.1 works 9.9 industries 6.2 5.5 4.2 GDP: UM 82,353 million GDP: UM 245,596 million Source: Office national de la statistique (1998), Annuaire Statistiqu; and data provided by the Mauritanian authorities. 7. The mining sector is considered to be the sector of the Mauritanian economy with the greatest potential. In 1999, the Government adopted a new Mining Code to provide a more attractive legal and fiscal framework for investors. It simplified the procedures for allocating mineral titles and offered exemptions from duties and taxes during the exploration period and the first five years of exploitation. 8. In the mid-1990s, the Government also began liberalizing the services sector, in particular air transport and telecommunications services, by opening them up to foreign investors and partially privatizing the State enterprises active in these areas. (2) AGRICULTURE (i) Overview 9. Agriculture accounts for about 18 per cent of GDP and employs nearly 60 per cent of the labour force.2 Livestock-raising is still the dominant activity and alone accounted for 14.1 per cent of GDP in 2001. The main agricultural activities are growing food crops and the nomadic herding of cattle and sheep. The principal crops are dates, millet, sorghum, paddy rice, maize, vegetables and 2 "Mauritanie" (1998), Marchés tropicaux et méditerranéens, special issue, March. Mauritania WT/TPR/S/103 Page 57 food root crops.3 Almost all agricultural production is consumed locally. As local production covers only about 40 per cent of the country's food requirements, local crops have to be supplemented by imports and international aid during periods of drought.4 10. According to the information available, the principal agricultural exports are cattle, hides and skins, and gum arabic. Exports of cattle on the hoof are difficult to evaluate owing to the lack of official statistics. However, the Mauritanian authorities estimate traditional exports of cattle on the hoof to the Malian, Senegalese and Moroccan markets at 30,000 to 70,000 head of cattle and 300,000 sheep.5 In 1997, the most recent year for which statistics are available, the Central Bank of Mauritania estimated that in value terms exports of hides and skins amounted to UM 51 million.6 Gum arabic production is gradually recovering after declining during the 1980s7, thanks to better weather conditions and increased participation by villagers.8 At present, according to the authorities, production is somewhere between 1,500 and 2,000 tonnes per year; direct and indirect exports9 were estimated at 1,000 tonnes in 1997.10 Mauritania has also begun exporting French beans, okra and melons. 11. Agriculture in Mauritania is heavily dependent on the weather conditions. Although it is a large country, less than 3 per cent of the land (502,000 hectares) is arable and only 1 per cent receives enough rain to grow food crops – mainly in the valley of the Senegal River. The country's irrigable potential is 137,000 hectares, of which only 33,600 hectares are currently in use, mainly for intensive rice growing, the rest being devoted to market gardening.11 Some 10 per cent of the country is grazing land. 12. The livestock subsector has been seriously affected by repeated spells of drought during the last 30 years, especially in 1972 and 1982-84. Some herds have still not fully recovered: for example, there were 1,394,000 head of cattle in 2001 as compared with 2,000,000 in 1969. However, in normal times, meat production is sufficient to meet local demand.12 (ii) Agricultural policy 13. Up to the beginning of the 1990s, the Government pursued a policy of food self-sufficiency, under which the importation of staples was controlled by the State trading enterprise SONIMEX. Since 1989, under the Agricultural Sector Adjustment Programme (PASA), the Government has been liberalizing the sector and gradually disengaging itself from direct participation in production. The measures implemented include the progressive elimination of SONIMEX's monopoly between 1990 3 United Nations Food and Agriculture Organization (undated). 4 In 1999, agricultural imports amounted to 36.4 per cent of total imports (table AI.3). 5 Mauritania is traditionally considered to be the region's biggest exporter of cattle on the hoof. However, it is difficult to estimate the volume of these exports as they fall mainly within the informal sector and accordingly are not recorded in the official trade statistics. 6 World Bank (2001b), Volume II, chapter 4. 7 Gum arabic production fell from 5,700 tonnes per year between 1968 and 1972 to 120 tonnes per year towards the end of the 1980s. 8 Ministry of Trade, Craft Industries and Tourism (2001). 9 There is substantial informal trade with Mali and Senegal. 10 Ministry of Rural Development and the Environment (2001). 11 Irrigated rice growing has been developed in the valley of the Senegal River thanks to the construction of two dams by the Senegal River Development Organization (OMVS), of which Mauritania is a Member together with Mali and Senegal. 12 Africa Institute of South Africa, online information. Available at the following address: http://www.ai.org.za/html/Restricted/body_mauritania.html. WT/TPR/S/103 Trade Policy Review Page 58 and 199313; the abandonment, in June 1999, of the former quota system which linked the importation of rice with the purchase of local paddy (box IV.1); and the abolition of export taxes (present in the legislation but, according to the authorities, never applied) on agricultural products such as live animals, meat and edible meat offal, certain dairy products, gum arabic, salt, and hides, in January 2000 (chapter III (3) (ii)). 14. As envisaged in the Letter on Irrigated Agriculture Development Policy to 2010 and the Programme for the Integrated Development of Irrigated Agriculture in Mauritania (LPDAI), the Government has also continued reducing customs tariffs and has standardized VAT at 14 per cent; and some food imports have been zero-rated for VAT. 15.
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