Beyond Extractives: Mauritania’s Chance to Unlock Jobs and Sustainable Growth

Mauritania’s extractives-driven growth model is no longer delivering jobs, stability or rising living standards, and the country now faces mounting productivity, labor market and climate challenges. The report argues that only bold reforms, expanding human capital, improving governance, and enabling a dynamic private sector, can diversify the economy and set Mauritania on a path toward inclusive, resilient, long-term growth.

Mauritania stands at a pivotal moment, as highlighted in the World Bank's Mauritania Growth & Jobs Report 2025, authored by the Global Practice for Macroeconomics, Trade and Investment, the Africa West and Central Region Chief Economist's Office, and the World Bank's Jobs Group. Their assessment is clear: the extractives-led development model that once propelled the country to lower-middle-income status has reached its limits. For two decades, Mauritania's economic fortunes have risen and fallen with global prices for iron ore, gold, copper and natural gas. While these industries account for more than 70 percent of exports and about one-fifth of GDP, they employ barely 1.2 percent of workers. Growth has averaged just 3.5 percent since 2000, below nearly all aspirational peers, and poverty reduction has been fragile, with poverty climbing again after the pandemic. Human development indicators have stagnated, and the country's Human Capital Index of 0.38 signals a generation falling far short of its potential.

Jobs Missing, Especially for Women

At the heart of the country's challenge is a labor market unable to absorb its rapidly growing working-age population. Only 42 percent of adults participate in the labor force, and women are particularly excluded; just 27 percent are economically active. Employment has shifted out of agriculture, yet workers overwhelmingly end up in low-productivity informal services rather than in higher-value sectors such as manufacturing, logistics, or ICT. Wholesale and retail trade dominate job creation, while wage employment barely increases, and most workers remain self-employed or in unpaid family roles. Women face even greater constraints, from early marriage and limited childcare to legal barriers in asset ownership and formal employment. Education quality remains low, skills mismatches are widespread, and the economy struggles to provide opportunities for young people entering the labor force each year.

A Private Sector Too Small to Transform the Economy

The report reveals a private sector that is underdeveloped, uncompetitive, and constrained by weak institutions. Mauritania creates only 0.4 new LLCs per 1,000 adults, one of the lowest rates in the region, and more than 90 percent of workers remain in informal employment. Formal firms grow slowly and invest little, with productivity declining in recent years. Market concentration is high, and politically connected companies dominate key sectors, reducing incentives for innovation and deterring new entrants. Barriers such as unclear land titles, unreliable contract enforcement, burdensome tax procedures, and slow customs operations further erode business confidence. Foreign investment overwhelmingly targets extractives, leaving agriculture, manufacturing and services without the capital or technology needed to expand. Export concentration has intensified, locking Mauritania deeper into commodity dependence.

Climate Stress and Fiscal Volatility

Climate change threatens to amplify the country's structural vulnerabilities. Mauritania is one of the world's most climate-exposed countries, facing rising temperatures, declining rainfall, coastal erosion, and intensifying floods. By 2050, climate impacts could reduce annual GDP by between 5.7 and 9.3 percent. These shocks hit rural women and girls hardest, reducing school attendance and worsening maternal health outcomes. Fiscal fragility compounds the risk: revenues from extractives are volatile, and the national hydrocarbon stabilization fund has failed to accumulate meaningful savings. Past windfalls were spent pro-cyclically on subsidies and low-yield projects rather than on human capital or infrastructure. Without stricter fiscal rules, public investment management, and climate adaptation financing, Mauritania will remain trapped in the boom-bust cycles that have shaped its recent history.

A New Pathway Toward Diversification

Despite these challenges, the report underscores that Mauritania possesses significant untapped opportunities. Agribusiness could thrive with better irrigation, energy access and land titling; horticulture alone employs thousands of women and could reduce food imports. Livestock products, dairy, leather and meat processing offer strong potential. Tourism remains an underdeveloped jewel, with desert landscapes and UNESCO heritage cities that could draw global visitors. Digital services are expanding, supported by internet penetration rising from 2 percent in 2012 to 80 percent in 2024, though regulatory gaps and low digital literacy remain. Renewable energy, particularly green hydrogen, could position Mauritania as a regional leader in low-carbon power.

The report proposes a reform strategy centered on human capital expansion, a predictable regulatory environment and a more dynamic private sector. Priority actions include scaling early childhood education, modernizing the labor code to remove gender bias, operationalizing the competition authority, digitizing all land transactions, and investing in STEM and technology adoption. Model simulations show that these reforms could raise GDP by more than 10 percent above baseline by 2050, expand employment and increase wages. With decisive implementation, Mauritania can move beyond extractives and achieve its ambition of becoming an upper-middle-income country by 2050. Without such reforms, growth will remain volatile, unequal and unable to meet the aspirations of its young population.