RESTRICTEDWORLD  TRADE
ORGANIZATIONWT/TPR/S/103
14 August 2002
(02-4343)
Trade Policy Review Body
TRADE POLICY REVIEW
MAURITANIA
Report by the Secretariat
This report, prepared for the first Trade Policy Review of Mauritania, has been
drawn up by the WTO Secretariat on its own responsibility.  The Secretariat has,
as required by the Agreement establishing the Trade Policy Review Mechanism
(Annex 3 of the Marrakesh Agreement Establishing the World Trade
Organization), sought clarification from the Government of Mauritania on its
trade policies and practices.
Any technical questions arising from this report may be addressed to
Mr W. Alfaro (Tel. 022/739 5372) or  Ms Ulla Kask (Tel. 022/739 5627).
Document WT/TPR/G/103 contains the policy statement submitted by the
Government of Mauritania.
Note: This report is subject to restricted circulation and press embargo until the end of the meeting
of the Trade Policy Review Body on Mauritania.Mauritania WT/TPR/S/103
Page iii
CONTENTS
Page
SUMMARY OBSERVATIONS vii
(1) ECONOMIC ENVIRONMENT vii
(2) INSTITUTIONAL AND TRADE POLICY FRAMEWORK viii
(3) TRADE  POLICY INSTRUMENTS ix
(4) SECTORAL POLICIES xi
I. ECONOMIC ENVIRONMENT 1
(1) BACKGROUND 1
(2) ECONOMIC DEVELOPMENTS 3
(3) TREND IN TRADE AND INVESTMENT 8
(i) Development in trade 8
(ii) Composition of trade 8(iii) Composition of trade in services 10
(iv) Investment 11
(4)
OUTLOOK 12
II. TRADE AND INVESTMENT REGIMES 13
(1) GENERAL INSTITUTIONAL AND LEGAL FRAMEWORK 13
(i) Overview 13
(ii) The Executive 13
(iii) The Legislature 13(iv) The Judiciary 15(v) Advisory organs 16(vi) Trade policy formulation and implementation 17(vii) Main laws and regulations 18
(viii) Transparency and governance 19
(2) T
RADE POLICY OBJECTIVES 20
(i) General objectives 20
(ii) Sectoral objectives 21
(3) T RADE AGREEMENTS AND ARRANGEMENTS 22
(i) World Trade Organization 22
(ii) Regional agreements 26
(iii) Other trade agreements and arrangements 28
(4) FOREIGN INVESTMENT REGIME 29
(i) Overview 29
(ii) Regulatory framework 29
III. TRADE POLICIES BY MEASURE 32
(1) OVERVIEW 32
(2) MEASURES DIRECTLY AFFECTING IMPORTS 32
(i) Procedures 32WT/TPR/S/103 Trade Policy Review
Page iv
Page
(ii) Customs valuation 34
(iii) Tariff regime and other taxes affecting imports 34
(iv) Rules of origin 41(v) Import licences, prohibitions and other controls 41(vi) Emergency measures 42(vii) Standards and other technical requirements 43(viii) Government procurement 44
(ix) State trading enterprises 46
(x) Other measures affecting imports 46
(3)
MEASURES DIRECTLY AFFECTING EXPORTS 47
(i) Registration and documentation 47
(ii) Export taxes 47(iii) Export prohibitions, controls and licensing 47
(iv) State trading 48
(v) Free points 49(vi) Aid to export, promotion and financing of exports 49
(4)
MEASURES AFFECTING PRODUCTION AND TRADE 49
(i) Incentives 49
(ii) Competition policy and regulatory issues 50
(iii) Pricing and marketing arrangements 50(iv) Protection of intellectual property rights 51
IV. TRADE POLICIES BY SECTOR 55
(1) I
NTRODUCTION 55
(2) A GRICULTURE 56
(i) Overview 56
(ii) Agricultural policy 57(iii) New guidelines for agricultural policy 60
(3)
FISHERIES 61
(i) Overview 61
(ii) Fisheries Policy 62
(4) MINING 66
(i) Overview 66
(ii) Mining policy 66
(5) MANUFACTURING SECTOR 71
(i) Overview 71
(ii) Sectoral policy 71
(6) SERVICES 72
(i) Overview 72
(ii) Financial services 73(iii) Telecommunications 76
(iv) Transport 77
(v) Tourism 79
BIBLIOGRAPHY 81
APPENDIX – TABLES 83Mauritania WT/TPR/S/103
Page v
CHARTS
Page
I. ECONOMIC ENVIRONMENTI.1 Real GDP per capita, 1960-2001 6
I.2 Trade in goods, 1992 and 1999 9
I.3 Trade in goods by destination, 1992 and 2000 11
III. TRADE POLICIES BY MEASURE
III.1 Breakdown of MFN duties applied, 2001 36
III.2 Rate of MFN duties applied, by section of the HS, 2001 37III.3 Tariff escalation, 2001 38
IV. TRADE POLICIES BY SECTOR
IV.1 GDP by sector, 1990-2001 56
IV.2 Escalation of duties applied to manufacturing industry products, 2001 73
TABLES
I. ECONOMIC ENVIRONMENT
I.1 Mauritania in figures 1990-2001 2
I.2 Main economic indicators, 1995-2001 4
III. TRADE POLICIES BY MEASUREIII.1 Main characteristics of the structure of MFN duties, 2001 37
III.2 Simple average of MFN duties, according to the stage of processing, 2001 38
III.3 Percentage of lines bound before, during and after the Uruguay Round 39
III.4 Thresholds for the award of government procurement contracts 45III.5 Principal amendments in the revised Bangui Agreement 52
IV. TRADE POLICIES BY SECTOR
IV.1 Taxation applicable to the various types of mining licences 70
IV.2 Price of communications:  international comparisons 77WT/TPR/S/103 Trade Policy Review
Page vi
APPENDIX TABLES
Page
I. ECONOMIC ENVIRONMENT
AI.1 Balance of payments, 1995-2001 85
AI.2 Exports by group of products, 1992-2000 86AI.3 Imports by group of products, 1992-2000 87AI.4 Exports by destination, 1992-2000 88
AI.5 Imports by origin, 1992-2000 89
II. TRADE AND INVESTMENT REGIMESAII.1 Mauritanian trade and investment laws and regulations 90
III. TRADE POLICIES BY MEASURE
AIII.1 MFN tariff rates, by hs chapter 91
AIII.2 Tariff statistics by isic rev.2 categories, 2001 95AIII.3 Tariff statistics, by group of products, 2001 99Mauritania WT/TPR/S/103
Page vii
SUMMARY OBSERVATIONS
(1) ECONOMIC ENVIRONMENT
1. Since the end of the 1980s, but
particularly since the end of the military
regime in 1992, Mauritania has embarkedupon economic reforms intended to liberalize
its economy and foreign trade and strengthen
the legislative framework.  The major reforms
focused on:  freeing prices and eliminating
barriers to international trade, liberalizationof the exchange regime;  stabilizing the
financial sector;  gradual privatization of
State enterprises;  and fiscal, customs and
judicial reforms.  The structural reforms have
laid the bases for sustained economicdevelopment and have decisively improved the
business climate in Mauritania.
2. The reforms, prudent micro-economic
policies and foreign support have allowed
Mauritania's economy to make notable
progress that has led in particular to steady
growth of the economy, a modest level ofinflation and a marked improvement in
government finance and the balance-of-
payments.  Since 1993, Mauritania's GDP has
risen at an average annual rate of 4.5 per
cent, sustained mainly by governmentinvestment (often financed by external funds)
and to a lesser degree by exports.  Real GDP
per capita has increased substantially since
1992.  Despite this progress, there is still a
high level of poverty in Mauritania and it isone of the least developed countries (LDC).
3. Mauritania's external debt continues
to remain at a high level (around
US$2.5 billion in 1999), equivalent to over
260 per cent of the GDP.  There is also arelatively high level of debt servicing,
although it has improved from 24 per cent of
exports in 2000 to 15.5 per cent in 2001.
Mauritania has qualified for debt relief under
the enhanced Heavily Indebted Poor Countries
Initiative (HIPC).  In addition to its debt
burden, Mauritania's economy remains highlyvulnerable to external shocks because of its
narrow production and export base.  The aridclimate helps to make Mauritania dependent
on food imports.
4. Mauritania's economy has
traditionally been based on trade and
agriculture, especially livestock, to which have
been added mining and fisheries.  The mostimportant sectors in terms of share of GDP
are:  services (with around 50 per cent) and
agriculture (with around 18 per cent).  The
fisheries and mining sectors as a whole,
however, provide almost all exports of goods,despite their fairly modest share of the GDP
(around 5 and 13 per cent respectively).  The
manufacturing sector remains relatively
undeveloped.
5. International trade plays an important
role in Mauritania's economy.  The shares of
imports and exports in the GDP are around
50 and 40 per cent respectively.  Foreign trade
remains highly concentrated, especially in
terms of products.  Commodities play the
leading role in trade in goods, particularly
exports (iron and fisheries products).  Theshare of staple food products in imports has
remained fairly stable (around 36 per cent of
the total);  petroleum products account for
around 16 per cent of total imports.
6. The European Union (EU) is
Mauritania's main trading partner.
Depending on the year, it takes between two-
thirds and three-quarters of Mauritania's
exports;  in 2000, the figure was 71 per cent.
Asia's share has fallen since 1994, fromalmost 29 per cent to less than 14 per cent in
2000.  As far as imports are concerned, the
EU is also Mauritania's major supplier, with a
market share ranging from 55 to 64 per cent in
the 1990s.  Although the shares of Americaand Africa have in general remained stable in
recent years, Asia's share has continually
decreased, especially since 1995.  Regional
trade (with the exception of petroleum
products from Algeria) is not very substantial.
Mauritania is a net importer of services,
particularly transport services.WT/TPR/S/103 Trade Policy Review
Page viii
(2) INSTITUTIONAL AND TRADE POLICY
FRAMEWORK
7. In 1991, Mauritania introduced
multiparty rule into its new Constitution,
together with the principle of the separation of
powers and recognition of individual andcollective freedoms.  The current political
system consists of an Executive power, vested
in the President of the Republic and the
Government appointed by him, a Legislative
power, exercised by the Parliament, which iscomposed of two houses, the National
Assembly and the Senate, and a Judicial
power, together with advisory institutions such
as the Higher Islamic Council and the
Economic and Social Council.
8. Primary responsibility for framing and
implementing trade policy lies with the
Ministry of Trade, Craft Industries and
Tourism.  Other ministries such as the
Ministries of Foreign Affairs and Cooperation,
Economic Affairs and Development, Finance,
Fisheries and the Maritime Economy, RuralDevelopment and the Environment, Interior,
Post and Telecommunications, Mining and
Industry, Public Works and Transport, and
Water Resources and Energy have direct
responsibility in their respective spheres.Closer coordination among these ministries
would enable Mauritania to have a more
consistent trade policy.  A formal framework
for consultation with the private sector was
established in 1996;  such consultation hasbecome a regular practice since 1998 and
appears to be highly valued by Mauritania's
private sector.
9. Reducing poverty and improving the
population's standard of living remain the keyobjectives of Government policy.  The general
objectives of the poverty reduction strategy
are to reduce the proportion of Mauritanian
citizens living below the poverty threshold to
less than 17 per cent by 2015 and to attain the
social development targets defined in respect
of education, health, access to drinking water,and housing.  The authorities consider
international trade to be an essential tool ineconomic development and, consequently, in
combating poverty.
10. In recent years, Mauritania has
revised and amended a large number of trade-
related  laws and regulations in order to
enhance the trade and investment environmentby liberalizing the economy and updating
legislation to take into account its obligations
under the multilateral trading system.  The
amendments concerned a variety of areas,
including customs valuation, investment,government procurement and competition.
The following are among the texts recently
amended (2002):  the Customs Code, the
Investment Code, and the Government
Procurement Law.  The competitionlegislation, which establishes freedom of
trade, pricing and competition, was
incorporated into the new Commercial Code
in 2000.  Other texts recently adopted include
the Arbitration Code, the Code of Obligations
and Contracts, and texts regulating the
organization of the Judiciary.
11. Mauritania's participation in the
multilateral trading system and in regional
and bilateral initiatives are a reflection of its
efforts to become integrated in the global
economy.  It is one of the original WTOMembers and grants at least MFN treatment
to all its trading partners.  Mauritania is
neither a signatory to nor an observer in the
WTO's plurilateral agreements.  At the end of
the Uruguay Round, Mauritania had bound833 of its 5,533 tariff lines, corresponding to
around 15 per cent of the total (including
agriculture);  100 per cent of tariff lines for
agricultural products have been bound.
Nevertheless, some confusion still remainsbecause Mauritania's previous commitments
(Geneva, Annecy and Torquay Schedules)
have not been transposed into the Harmonized
System.  According to an unofficial provisional
transposition made by the WTO Secretariat,
Mauritania's tariff bindings cover around
41 per cent of the total tariff lines.
12. Mauritania has also submitted its
schedule of commitments on services.  The list
does not contain any horizontal restrictionsMauritania WT/TPR/S/103
Page ix
nor exemptions from the obligation to grant
MFN treatment.  Mauritania has undertaken
specific commitments in the tourism sector.  At
the Fourth Ministerial Meeting of the WTO in
Doha, Mauritania underlined the importance
of international trade as a tool for povertyreduction and supported the launching of a
new round of multilateral trade negotiations.
As regards the WTO's dispute settlement
mechanism, Mauritania has not been involved
in any case.  Mauritania has not yet fulfilledits obligations in respect of most of the annual
notifications required under the WTO
Agreements.
13. A study carried out by the World Bank
in 2001 shows that, despite sustained growthin the economy and significant trade reforms,
Mauritania is still not well integrated in the
global economy.  The key obstacles to
development of Mauritania's trade include
supply-side constraints (in particular the very
limited number of exportable products),
inadequate port and road infrastructure, andpoor tourism facilities, the lack of human and
institutional resources needed for more
effective participation in the multilateral
system, and in negotiations in particular.  In
order to tackle these constraints, a coherentprogramme of integrated technical assistance
is needed.  The trade-related areas in which
Mauritania has the greatest need of assistance
are:  knowledge of issues relating to the
multilateral system, especially in universitycircles and the private sector and among
officials responsible for implementing trade
policy instruments;  notifications;
implementation of the WTO Agreements and
capacity-building for negotiations.Mauritania is one of the first three pilot
countries for the implementation of the
Integrated Framework for Trade-Related
Technical Assistance to least developed
countries.
14. Mauritania has signed a number of
trade agreements with countries includingAlgeria, Egypt, Gambia, Mali, Morocco,
Senegal and Tunisia.  It did not prove possible
to determine definitively the level of tariff
preferences covered by these bilateralagreements.  Mauritania also belongs to the
Arab Maghreb Union (UMA), which does not
appear to be operational at present.  It was a
Member of the ECOWAS until the end of 1999,
when it withdrew for political and economic
reasons.
15. Mauritanian products enjoy non-
reciprocal preferential treatment on the
European Union market under the Cotonou
Agreement and the "Everything but Arms"
Programme for LDCs.  Preferences are alsogranted to Mauritanian products on the
United States market under the African
Growth and Opportunity Act and on the
markets of other developed countries under
the Generalized System of Preferences (GSP).
(3) T
RADE POLICY INSTRUMENTS
16. In recent years, Mauritania's trade
regime has been liberalized.  The purpose of
the trade reform was to eliminate barriers to
international trade and to enhance the
competitiveness of Mauritania's exports.
Customs procedures have been simplified, andthe majority of customs duties rationalized,
while most non-tariff measures have been
abolished.
17. In June 2002, Mauritania amended its
customs valuation legislation and now uses thetransaction value as the basis for valuing
imported goods.  It would seem, however, that
the minimum import value is still used for
second-hand vehicles.
18. Customs tariffs are Mauritania's main
trade policy instrument at the border.  A
statistical fee of 3 per cent is also imposed on
the majority of imported goods.  All the
customs tariffs applied are ad valorem duties,
which makes the Mauritanian tariff systemmore transparent.  Seasonal duties are applied
to a limited number of agricultural products.
MFN duties have been reduced and
rationalized in recent years (the number of
rates has fallen from 13 in 1997 to 4 in 2000),
and the maximum duty fell from 30 to 20 per
cent over the same period.  In 2002, the simpleaverage of MFN duties applied (excluding theWT/TPR/S/103 Trade Policy Review
Page x
statistical fee) is 10.6 per cent, with an
average of 10.3 per cent for manufactured
goods and 12 per cent for agricultural
products (WTO definition).  The level of
binding of MFN duties remains higher.  MFN
duties on agricultural products have beenbound at rates of 25 per cent, 30 per cent,
50 per cent and 75 per cent depending on the
category of product;  duties on other goods
(including leather, rubber, footwear and travel
goods, together with transport equipment)have been bound at a uniform rate of 30 per
cent.  Bridging the gap between bound rates
and those applied, while maintaining the
current level of openness in the market, would
enhance the predictability of Mauritania'stariff regime.  Although there is a certain
degree of escalation of MFN rates in some
branches, in general the situation is less clear-
cut.  Overall, the rates applied to raw
materials are slightly higher than those
applicable to intermediate goods, but are
lower than the rates applied to processedgoods, which shows a relatively high level of
protection given to certain agricultural
commodities.  In general, escalation is slightly
more marked in industry than in agriculture,
although there are considerable discrepanciesaccording to the branch of activity.
19. Imported goods are subject to a value
added tax (14 per cent) and some products are
subject to excise duty.  The rates applied to
imported products are the same as thoseapplicable to domestic products.
20. Some operators are eligible for
exemptions from general taxes at the border.
Waivers and exemptions from import duties
and taxes are classified into the followingcategories:  exemptions for the National
Industrial and Mining Company (SNIM);
Investment Code;  aid and grants;  diplomatic
exemptions;  special exemptions;  partial
waivers;  and other exemptions and waivers.
The Customs Code also includes a regime for
the refund of duties under which exporters areeligible for partial or total refunds of duty
paid on imported inputs.21. Mauritania's import regime includes
few non-tariff barriers.  The import of the
majority of products does not require an
import licence.  There are very few import
restrictions, which are mainly intended to
guarantee safety, public order and health.  Theformer quota system, wh ich linked rice imports
to purchase of local paddy rice, was abolished
in 1999.  Mauritania does not have any
standardization or quality control systems and
does not possess an adequate infrastructurefor testing and metrology.  It would appear
that, for reasons such as safety or health,
French, American or other international
standards may be applied and required when
products are imported into Mauritania.
22. The new Government Procurement
Code came into effect in 2002 and it makes the
regime more transparent, although
Mauritanian enterprises may still be given a
preferential margin of up to 15 per cent.
Mauritania does not have any special
legislation on the application of anti-dumping,countervailing or safeguard measures.  Some
provisions on anti-dumping measures can be
found in the Customs Code, giving the
President the right to impose anti-dumping or
countervailing measures through a decree,where necessary, but no measure of this type
has yet been applied.
23. The export regime has also been
liberalized.  Mauritania does not impose any
bans or quantitative restrictions on exportsand does not require export licences.  Export
taxes have been abolished, with the exception
of products of the pelagic fishing industry and
the small-scale fishing industry.  The
Government does not grant any special exportsubsidies.
24. There are no special incentives given
to Mauritanian enterprises.  Some measures
currently in effect allow enterprises to enjoy
fiscal advantages such as the reimbursement
of VAT, declining and deferred balances, and
a system of free points for exportingenterprises.Mauritania WT/TPR/S/103
Page xi
25. The legislation on the protection of
intellectual property has been revised at the
regional level (within the framework of the
African Intellectual Property Organization
(AIPO)).  Mauritania's international
commitments on intellectual property rightsare governed by the revised Bangui Agreement
of 1999, which came into force in 2002.
According to the Mauritanian authorities, the
purpose of the revision was to bring the
regional system into conformity with theTRIPS Agreement.  The national authorities
are responsible for ensuring observance of
intellectual property rights.
(4) 
SECTORAL POLICIES
26. Mauritania does not apply any special
sectoral trade policies.  The new Investment
Code, enacted in 2002, establishes free points
as the major tool for promoting exports.  The
Code applies to all sectors of the economy
and, unlike the previous Code, no longer
defines priority areas.  In general, the new
Code considerably simplifies the financialincentives and abolishes the special regimes
(with the exception of that applying to the
national company SNIM).
27. In the past, the Mauritanian
Government pursued a food self-sufficiencypolicy, but the agricultural sector has now
been liberalized.  One of the principal features
of the reform has been the development of
agricultural credit, formerly reserved for rice
production, and subsequently made availablefor other activities.  Several programmes are
being implemented, the most important of
which is the Programme for the Integrated
Development of Irrigated Agriculture in
Mauritania (PDIAIM).  The objective ismainly to increase value added in the
agricultural sector and improve the
employment opportunities and income of the
inhabitants of the Senegal river valley.  The
principal measures envisaged are the
establishment of a favourable legal and
institutional framework, the development ofbasic infrastructure, the diversification of
production and the mitigation of the impact on
the environment.28. Fishing is one of the key sectors of the
Mauritanian economy.  Initially, in the 1970s,
fisheries policy was more protectionist and
aimed primarily at encouraging the creation
of a national industrial fishing fleet;  in 1994,
it was revised and focused principally on theprotection of resources, the rationalization of
fishing, the improvement of the sector's
performance and the continuing withdrawal of
the State from production and marketing
activities.  The new Fisheries Code of 2000 isalso based on these principles and stresses the
controlled development of commercial fishing,
the expansion of small-scale fishing and the
reorganization and modernization of the
Mauritanian fleet, together with developmentof exports of processed products.  Mauritania
has concluded bilateral fisheries agreements
with Algeria, Japan, Morocco, Russia,
Senegal, Tunisia and the European Union.
With regard to exports, the Mauritanian Fish
Marketing Company (SMCP) has a monopoly
of marketing of fisheries products subject tothe landing obligation (mainly cephalopods).
Other species may be freely exported.
29. The mining sector is considered to
offer great potential for Mauritania.  It is also
one of the key sectors in Mauritania'seconomy;  iron ore exports account for around
60 per cent of Mauritania's total exports.  In
1999, with the assistance of the World Bank,
the Government drew up the Project for the
Institutional Strengthening of the MiningSector (PRISM) whose main objective is to
build Mauritania's capacity and improve its
competitiveness in order to attract private
investment in the development of the mining
sector.  A new Mining Code was adopted in1999 designed to stimulate and encourage
investment in mineral exploration and
production.
30. The Mauritanian manufacturing sector
is comparatively undeveloped.  The processing
of fisheries products excluded, the sector
contributes about 4.2 per cent to GDP (8.4 percent including the processing of fisheries
products).  Almost all manufacturing output is
consumed locally.WT/TPR/S/103 Trade Policy Review
Page xii
31. The liberalization and privatization of
services such as financial or insurance
services was initiated at the end of the 1980s.
Almost all the banks have been privatized.  To
improve the financing of traditional sectors, in
1998, a new law on micro-financialintermediation was adopted.  To finance the
economic sectors with a strong potential for
job creation, the authorities have encouraged
the establishment of specialized institutions
such as UNCACEM for agriculture orUNCOPAM for small-scale fishing.  The
liberalization of air transport and basic
telecommunication services got under way in
the early 1990s.  New legislation on air
transport is being prepared and thetelecommunications legislation was drawn up
in 1999.  Air Mauritanie and Mauritel were
privatized in 1999 and 2001 respectively.  The
tourism sector is largely open to foreign
participation and, since the adoption of a new
law in 1996, investment in this sector has
increased.