• Saturday, March 02, 2024
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Mauritania’s economy to grow 14% on gas exports says IMF

Social protection needed to soften impact of FX reforms – IMF

The International Monetary Fund expects Mauritania’s economic growth to almost triple in 2025 fueled by gas exports set to start in the second half of this year.

Gross domestic product growth of 5.1% predicted for 2024 is forecast to reach 14.3% in 2025 based on mining and gas revenue from the Grand Tortue Ahmeyim development, said Felix Fischer, the IMF’s head of mission to Mauritania.

“We project that the first gas production from GTA will start in the first half of 2024 with gas exports expected in the second half, which will contribute positively to GDP growth starting in 2024,” Fischer said.
Output capacity should be reached in 2025, according to IMF estimates. “That’s when the biggest impact is going to be and where we see a growth projection of 14.3% with gas exports representing 11.6% of total exports,” Fischer said in a phone interview from Washington.

The $4.8 billion project straddling the Northwest African nation and Senegal’s maritime border is being developed by BP Plc and Kosmos Energy Ltd. The offshore GTA field is set to produce 2.5 million tons of liquefied natural gas a year in the first phase.

Europe could be a welcome recipient of the fuel as it seeks new supplies to further reduce its reliance on Russia in the aftermath of the country’s 2022 invasion of Ukraine. The GTA site is around two weeks sea voyage from Europe.

Gas exports could make one of the poorest nations in the world the fastest growing on the continent in 2025, IMF forecasts show, boosting revenues for much needed development spending. Mauritania projects 800 million ouguiya ($20 million), or 2% of GDP, in revenue from GTA gas in 2024 and 2.6 billion in 2025.

“These exports will be very important for Mauritania to maintain its international reserves at adequate levels over the medium term,” Fischer said.

First gas delays

Still, delays to the start of GTA gas coming online and price fluctuations in commodity markets could “lower fiscal revenue, increase external financing needs, and worsen the medium-term debt profile,” of the country, the IMF said last month after a review of Mauritania’s program with the Washington-based lender.