The Mauritanian Economy

Mauritania is one of the poorest countries in the world. The vast majority of the population still relies on small scale farming for their income. Unfortunately the country frequently suffers from droughts that have made this an unreliable source of income. The result has been that in recent years the country has had to import food. With no money to pay for it this resulted in Mauritania running up a massive foreign debt. Since it was clear that they would never be able to pay this debt the vast majority of it has been forgiven. While this solves one problem it does little to address the fact the country remains very poor and that prospects for growth are bleak.

The only real source of income that Mauritania has is iron. There are large deposits of iron and these represent the vast majority of exports. Relying so heavily on one commodity for your income is risky and puts the country at the mercy of changing iron prices. There have been attempts to diversify the economy but so far these have not been particularly successful. For a time it looked like there might be large oil reserves in Mauritania but this has proven to be misleading and little oil has been produced. The waters off the coast offer some of the finest fishing grounds in the world, unfortunately overfishing by other countries has significantly reduced the yields.

Another attempt to diversify the economy was the attempt to be build a large ocean port. In theory the country is an ideal place to ship products into and out of Africa. In practice it hasn’t worked out that way and the port has not received a lot of use due to competition from other countries. While it is good that the government are trying to address their problems by diversifying the economy there are probably better ways to do it.

One of the problems that has hurt the economic development of Mauritania is the instability of the government. There have been a number of coups over the years and this has led to constant fighting and changing of policy. The instability has made it very difficult for the country to follow a coherent path of economic development. Every time a new government comes to power they change course. It also reduces the foreign aid that comes into country since it is cut off every time there is coup.

The current government plan for improving the economy is to reduce the levels of poverty. Before anything else can happen the people are going to have to move beyond the subsistence level of farming. This requires a serious effort on the part of the government who need to invest a lot of money into increasing the education levels and the health of the population. The current government is committed to this plan but how long that lasts for remains to be seen.