This article is sponsored by Ministry of Petroleum, Energy and Mines of the Islamic Republic of Mauritania
Mauritania is strategically leveraging its proximity to Europe and its wealth of natural resources in a bid to position itself as an attractive investment destination. Just two days by sea from European ports, the country is transforming its business climate with a modernised regulatory framework aimed at attracting global capital. Anchored by an updated investment code, the government places foreign direct investment at the heart of its economic strategy.
The revamped framework offers robust incentives to investors, including significant tax breaks, customs relief, and sector-specific benefits spanning mining, oil, gas, and renewable energy. Projects in remote areas gain an added advantage with five-year tax exemptions in a bid to spread wealth around the nation. By aligning its standards with global best practices, Mauritania is steadily enhancing transparency and strengthening investor confidence – a commitment further reinforced by its active role in the Extractive Industries Transparency Initiative (EITI).
Since joining EITI in 2006, Mauritania has released 17 revenue reports, increasing its appeal among global investors. “Mauritania was, like many African countries, a place where there was no access to information related to the mining sector. It was very opaque, and only the industries and the government had all the information, which they were not willing to share with the public,” explains Aliou Ba Coulibaly, president of the Publish What You Pay Coalition in Mauritania. “Since joining the EITI in 2006, transparency has vastly improved. What was once a closed book is now open to the public, fostering trust and improving the investment environment.”
A recent United Nations Conference on Trade and Development (UNCTAD) report highlighted Mauritania’s achievements while suggesting potential tweaks to its legal framework, including refining the stability clause and offering non-tax incentives. Implementing these recommendations could strengthen the alignment between foreign investments and Mauritania’s sustainable development goals, ensuring that economic gains remain equitable and far-reaching.
Mauritania’s Agency for the Promotion of Investment (APIM) meanwhile is initiating reforms to expedite processes and reduce red tape. The agency’s “Guichet Unique” system has cut the time needed to register a business to just 48 hours. Recent tax reforms, including the replacement of the old industrial profit tax with a modern corporate tax structure, are part of broader efforts to attract investors.
These reforms, alongside partnerships with the IMF and World Bank, and its re-entry into the US’s African Growth and Opportunity Act (AGOA) in 2024 open fresh avenues for market access and international collaboration.
While these improvements are notable, challenges remain. Civil society advocates, including Coulibaly, continue to urge the government to allocate a more significant share of resource revenues toward infrastructure and essential services. “We need to use the wealth from oil and mining to build infrastructure, healthcare, and education – assets that will endure long after the resources are exhausted,” Coulibaly told African Business.
In response, Mauritania is formulating a comprehensive local content law aimed at ensuring that the benefits of its burgeoning energy sectors – particularly oil, gas, and mining – are distributed to Mauritanian citizens. With production from the Greater Tortue Ahmeyim (GTA) gas project, a joint venture with BP and Kosmos spanning Mauritania and Senegal, set to commence in January 2025, the government is embedding local business and workforce integration into its legal framework.
The local content law, under discussion, would mandate that foreign companies prioritise local goods, services, and workforce resources wherever feasible, reinforcing the country’s goal of skill-building and economic resilience.
This policy approach draws inspiration from local content laws in the MSGBC (Mauritania-Senegal-Guinea-Bissau-Conakry) region, where similar regulations have bolstered skills development and technological transfer. “We are working on the law of local content, and this has been a key issue because, in most of Africa, local content often focuses solely on the mining sector and procurement. However, we must go beyond this, focusing on developing soft skills and creating sustainable linkages that extend beyond the extractive industries,” says Coulibaly.
Mauritania is also positioning itself as an emerging player in green hydrogen, aligning with international standards for energy governance. With support from the World Bank and a multi-year development strategy, Mauritania is working toward transparency in this nascent sector. Developed in collaboration with the EU’s CONNEX Support Unit, the nation’s hydrogen code aims to lower investment risks, paving the way for global firms like CWP and Chariot to enter the market. To enhance governance, discussions are underway to expand EITI standards to include green hydrogen, ensuring that investment aligns with Mauritania’s sustainable development goals.
Fisheries, agriculture, and infrastructure are also key areas. Agriculture, especially along the Senegal River Valley, presents a substantial investment prospect. Given that domestic production meets only a third of the country’s food demand, Mauritania is prioritising the modernisation of agriculture, the electrification of rural areas, and the establishment of a wholesale market in Nouakchott.
Mauritania’s updated Investment Code forms a foundation for its investment strategy, offering incentives like free land, tax reductions, and duty-free importation of equipment in special economic zones (SEZs) and priority sectors. The Nouadhibou Free Trade Zone, Mauritania’s premier SEZ, offers further tailored incentives, including reduced municipal taxes, property tax exemptions, and provisions to encourage local hiring and workforce development.
“With all these mechanisms and reforms, there is hope that Mauritania is making significant progress towards transparency and accountability in managing its natural resources. These changes give us the potential to ensure sustainable development that benefits the country long after the resources are depleted,” Coulibaly says.