Due to the enhanced connectivity between businesses from different parts of the world, and the increased reliance of economies on each other in view of the resources managed by them, it is not uncommon to see investors move around to identify the best profitable opportunities. Several factors contribute to attracting investors to an economy including the readiness of infrastructure, social stability, conducive environment for business operations in addition to the availability of cost-effective natural as well as human resources.
Mauritania has been opening its economy up for investors to explore from a wide range of options. While the oil and gas sector accounted for most of the investments coming into the country, the Mauritanian government is trying to direct the inflow of investment to other sectors. The launch of the “iGuide” in November last year, as an online system that provides detailed explanations about the various investment opportunities available in each sector, represents a step in the right direction to facilitate and escalate foreign direct investment in Mauritania.
Amidst the efforts to expand the countries economy, Mauritania places special emphasis on good governance, in order to build effective strategies to manage resources and overcome challenges, which will enable the country to occupy commendable ranks on the transparency and good governance index.
Mauritania is rich in mineral resources with more than 900 types of minerals can be found in the country including iron, gold, copper, quartz, uranium, phosphate, manganese and chromium. In order to create the conditions for optimal investment, the government of Mauritania has adopted a strategy to modernise and develop mineral resources via an incentive mining code, favourable competitiveness and the construction of basic infrastructures. Many years ago, Mauritania created a database for its mineral resources through a project that was supported by the World Bank.
The mining sector has been an important contributor to Mauritania’s economy for more than 50 years. It accounts for about one-third of the country’s gross domestic product.
The project involved designing bibliographical and mineral occurrence database and incorporating these into a Geographical Information System (GIS). This made the search and exploration of these minerals easier and faster. Today, Mauritania is a significant supplier of copper, gold, and iron ore to the world. The country has been one of the world’s top 15 iron-ore-exporting countries and Africa’s third-ranked producer and exporter of iron ore after South Africa and Sierra Leone. Several foreign companies from Australia, Switzerland and other countries have been leading the exploration and extraction of minerals in Mauritania.
Fishing is very important to the Mauritanian economy. It accounts for up to 10% of GDP and up to 50% of the county’s exports. Yet, a huge potential to benefit from the fisheries industry remains untapped.
The western borders of Mauritania stretch for more than 1500 kilometres, with about 754 kilometres as coastline at the Atlantic Ocean forming the country’s western frontier, and 813 kilometres of the Senegal River in the southwest. Having one of the world’s most plentiful ocean fishing areas, Mauritania has a great opportunity to improve domestic food security, earn much needed hard currency and develop the national economy simultaneously. However, the exploitation of this sector by the Mauritanian government has been limited.
Meanwhile, eleven European countries have the right to fish in Mauritania’s water based on the EU-Mauritania Fisheries Partnership Agreement. While this agreement earns the country about 70 million euros every year, experts say Mauritania needs to do more to develop the industry because the revenues can be much higher than the current figures. In June 2019, the EU issues a note to negotiate a deal to extend the agreement, which ends on 15 November 2019, but the Mauritanian government is asked to look into this extension and to take care of local fishermen, because the current deal does not create many jobs, as most processing is done elsewhere.
In 2016, Mauritania announced the Accelerated Growth and Shared Prosperity Strategy which considers renewable energy to be a priority for poverty alleviation in a country that is rich in natural resources. As part of that strategy, the Government of Mauritania has been working to expand electricity supply and to encourage investment in the renewable energy sector to stimulate the economy. the substantial renewable energy resources in Mauritania include solar, wind and hydro powers in addition to abundant natural gas reserves.
While Mauritania’s renewable energy sector faces some formidable challenges, the sector is a worthwhile investment for the country in the long-term.
If Mauritania could harness the high radiation averages throughout the country and high wind speeds in the coastal areas, it could potentially make renewable energy sources competitive in most regions that currently use electricity generated by heavy fuel oil. However, to date, Mauritania lacks a strong deployment strategy, comprehensive regulatory framework and skillful manpower to implement and manage large-scale projects to harness renewable energy. The need to attract large investment in the renewable energy sector becomes more compelling in view of the capacity of the current network where about half of the population does not have access to electricity, according to reports by the World Bank.