IMF approves $130m grant for Mauritania to address Covid-19 pandemic

The economy of the African nation is projected to contract by 2% this year

The IMF forecast that economies in the Middle East and Central Asian region will contract by 4.7% this year. AFP

The International Monetary has approved a grant of $130 million (Dh477.1m) for Mauritania - under the Rapid Credit Facility - to fight the coronavirus outbreak.

The new funds will help the north-west African nation to increase spending on health services and social protection programmes, said IMF in a statement.

“The Covid-19 pandemic is having a dramatic human, economic and social impact on Mauritania,” said Mitsuhiro Furusawa, IMF’s deputy managing director and acting chair.

“The authorities have responded swiftly with measures to contain the pandemic and alleviate its fallout. Going forward, prioritising health spending and targeted support to the most vulnerable households and sectors in the economy remains critical,” he added.

The short-term economic outlook of Mauritania has deteriorated rapidly and growth is expected to turn negative this year, “with severe hardships for the population and the outlook is subject to considerable uncertainty”, noted the IMF.

The economy is currently projected to contract by 2 per cent this year and the overall budget deficit could rise to 3.4 per cent of the gross domestic product.

However, the IMF’s financial assistance will provide a sizable share of the financing needed to implement the anti-crisis measures, said Mr Furusawa.

"Additional concessional and grant financing from the international community will be critical to close the remaining financing gap and help Mauritania respond effectively to the crisis,” he added.