Document of The World Bank FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No: 75030-MR INTERNATIONAL DEVELOPMENT ASSOCIATION INTERNATIONAL FINANCE CORPORATION AND MULTILATERAL INVESTMENT GUARANTEE AGENCY Public Disclosure Authorized COUNTRY PARTNERSHIP STRATEGY (FY2014-2016) FOR THE ISLAMIC REPUBLIC OF MAURITANIA September 5, 2013 Public Disclosure Authorized Country Department AFCF1 Africa Region International Development Association International Finance Corporation Africa Region Multilateral Investment Guarantee Agency This document has a restricted distribution and may be used by recipient only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. Public Disclosure Authorized The date of the previous IDA Country Assistance Strategy for Mauritania (Report No. 39532-MR) was June 14, 2007. CURRENCY EQUIVALENTS (As of 30 November 2012) Currency Unit: Mauritanian Ouguiya UM 1 UM = US$0.0033 1.52US $ = SDR1 0.654950 FISCAL YEAR 01 January – 31 December WEIGHTS AND MEASURES Metric System ABBREVIATIONS AND ACRONYMS AAA Analytical and Advisory Activities ACE Africa Coast to Europe Submarine Cable AFD Agence Française de Développement (French Development Agency) AfDB African Development Bank AIDS Acquired Immune Deficiency Syndrome APL Adaptable Program Loan AQMI Al Qaeda in the Islamic Maghreb BCM Banque Centrale de Mauritanie (Central Bank of Mauritania) BEEP Business Environment Enhancement Project CAS Country Assistance Strategy CASCR Country Assistance Strategy Completion Report CBO Community-Based Organizations CDD Community-Driven Development CEM Country Economic Memorandum CO Country Office CPS Country Partnership Strategy CS Civil Society CSP Country Strategy Paper DPO Development Policy Operations EC European Commission ECF Extended Credit Facility ECOWAS Economic Community of West African States EIB European Investment Bank EITI Extractive Industries Transparency Initiative ESW Economic and Sector Work EU European Union FDI Foreign Direct Investment FIRST Financial Sector Reform and Strengthening Initiative FY Fiscal Year GAC Governance and Anti-Corruption GDP Gross Domestic Product GEF Global Environment Facility GFRP Global Food Crisis Response Program GNI Gross National Income GTFP Global Trade Finance Program GIZ Deutsche Gesellschaft für Internationale Zusammenarbeit (German International Cooperation Agency) HCE High Council of State HIPC Heavily Indebted Poor Countries HIV Human Immune Deficiency Virus IBRD International Bank for Reconstruction and Development ICT Information and Communication Technology IDA International Development Association IDB Islamic Development Bank IEG Independent Evaluation Group IFAD International Fund for Agricultural Development IFC International Finance Corporation IGG Inclusive Green Growth IMF International Monetary Fund JICA Japan International Cooperation Agency JSDF Japanese Social Development Fund KfW Kreditanstalt für Wiederaufbau (Bank implementing German Financial Cooperation) MAED Ministère des Affaires Economiques et du Développement (Ministry of Economic Affairs and Development) MAP/AIDS Multi-Sector AIDS (Control) Project MDG Millennium Development Goal MDRI Multilateral Debt Relief Initiative MEMAU Modèle de l’Economie Mauritanienne (Model of Mauritania’s Economy) MEF Ministère de l’Economie et des Finances (Ministry of Economy and Finance) M&E Monitoring and Evaluation MF Ministry of Finance MIC Middle Income Countries MIGA Multilateral Investment Guarantee Agency MR Mauritania MTDS Medium-Term Debt Management Strategies NSDS National Strategy for the Development of Statistics NSS National Statistical System ODA Official Development Assistance ONS Office National des Statistique (National Statistical Office) OMVS Organisation pour la Mise en Valeur du fleuve Sénégal (Organization for the Development of the Senegal River) PDIAIM Projet de Développement Intégré de l’Agriculture Irriguée en Mauritanie (Integrated Development Program for Irrigated Agriculture in Mauritania) PDRC Projet de Développement Rural Communautaire (Community-Based Rural Program) PDU Programme de Développement Urbain (Urban Development Program) PEs Public Enterprises PEFA Public Expenditure and Financial Accountability PER Public Expenditure Review PFM Public Finance management PPP Public-Private Partnerships PRECASP Projet de Renforcement des Capacités du Secteur Public (Public Sector Capacity Building Project) PREM Poverty Reduction and Economic Management PRISM2 Projet de Renforcement Institutionnel du Secteur Minier 2 (Second Mining Sector Capacity Building Project) PRGF Poverty Reduction and Growth Facility PRSP Poverty Reduction Strategy Paper PSD Private Sector Development ROSC Report on the Observance of Standards and Codes SDV Social Development Department SME Small and Medium Enterprises SNIM Société Nationale Industrielle et Minière (Mauritanian State Mining Company) SOMELEC Société Mauritanienne d’Electricité (Mauritania National Electricity Company) TA Technical Assistance TVET Technical and Vocational Education Training TF Trust Fund TFP Technical and Financial Partner TFSCB Trust Fund for Statistical Capacity Building TVTF Technical and Vocational Training Fund UN United Nations UNCACEM Credit and Savings Co-operatives of Mauritania (AFD) UNDP United Nations Development Program UNICEF United Nations Children's Fund UNESCO United Nations Educational, Scientific and Cultural Organization UNFPA United Nations Population Fund UNS United Nations System USAID United States Agency for International Development WAPP West Africa Power Pool WB World Bank WBG World Bank Group WBI World Bank Institute y-o-y year-on-year IDA Vice President: Makhtar Diop (AFRVP) Country Director: Vera Songwe (AFCF1) Task Team Leader: Moctar Thiam (AFMMR) IFC Vice President: Jean Philippe Prosper (CXAVP) Regional Director: Yolande B. Duhem (CAFWO) Principal Country Officer: Jerome P. Cretegny (CAFW3) MIGA Vice President: Michel Wormser (MIGCO) Advisor: Mansour Elimane Kane (MIGEA) REPUBLIC OF MAURITANIA COUNTRY PARTNERSHIP STRATEGY TABLE OF CONTENTS EXECUTIVE SUMMARY ........................................................................................................... I I. COUNTRY CONTEXT AND DEVELOPMENT AGENDA ........................................... 1 1.1. Political and Social Context ................................................................................................. 1 1.2. Poverty Profile and Trends ................................................................................................. 3 1.3. Recent Economic Developments ........................................................................................ 6 1.4. Economic Prospects ............................................................................................................ 8 1.5. Major Development Challenges ....................................................................................... 10 1.6. Government Priorities and Poverty Reduction Strategy 2011-2015................................. 17 II. BANK GROUP ASSISTANCE STRATEGY .................................................................. 19 2.1. Experience and Lessons Learned from Previous CAS and from Stakeholder Feedback . 19 2.2. The Current World Bank Group Portfolio ........................................................................ 23 2.3. Looking Forward: Proposed World Bank Group Strategy for FY2014-16 ...................... 24 2.4. Expected Results and Program of Lending and Non-Lending Activities ......................... 25 III. IMPLEMENTING THE FY14-16 COUNTRY PARTNERSHIP STRATEGY ........... 36 3.1. Managing Program Implementation ................................................................................. 36 3.2. Partnerships and Donor Coordination ............................................................................... 36 3.3. Monitoring and Evaluation ............................................................................................... 37 IV. MANAGING RISKS .......................................................................................................... 37 List of Tables Table 1: Current Active WB Portfolio in Mauritania ................................................................... 23 Table 2: Proposed Lending and Non-Lending Activities ............................................................. 35 Table 3: Summary of CAS Program Self-Evaluation ................................................................... 57 Table 4: Planned Lending Program and Actual Deliveries (Base Case of CAS Plan) ................ 69 Table 5: Planned Non-Lending Services and Actual Deliveries .................................................. 70 Table 6: Lending operations and implementations ....................................................................... 72 Table 7: Inventory of Mauritania Surveys .................................................................................... 78 List of Figures Figure 1: GDP Growth by Sector, 2007-12 .................................................................................... 6 Figure 2: Public Investment by Sector, 2012-15 ............................................................................ 8 Figure 3: Global Competitiveness of the Mauritanian Economy (Min = 0, Max=7) ................... 14 Figure 4: Ease of Doing Business Index 2013(ranking) ............................................................... 14 Figure 5: Doing Business 2013: Areas of concern for Mauritania