Mauritania. A. Definitions and sources of data

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1 Mauritania A. Definitions and sources of data In Mauritania, the Investment Code (Ordonnance No /CMSN of January 1989 and its revision number ) does not provide a specific definition of foreign direct investment (FDI). However foreign capital investment is defined as the contributions of foreign currency or new capital equipment in any enterprise, on the condition that it offers shares or stocks; the reinvestment of profits, which could have been transferred abroad; and the repurchase of existing enterprises or participation in existing enterprises effected by a return of foreign currency. The International Monetary Fund provides data on FDI in Mauritania in its balanceof-payments statistics. Mauritania offers several guarantees to foreign investors and these typically include; availability of hard currency to import all goods and services needed for the operation of the enterprise and for repaying loans contracted; freedom to transfer foreign capital; ability to transfer professional income of foreign employees; protection of vested interests and equal treatment of Mauritanian and foreign individuals and legal entities. There exist no legal or policy restrictions on converting or transferring funds associated with an investment. Government revenue has grown significantly, since 2004 encouraging infrastructure investments. The country contains considerable mineral resources, notably iron ore, copper, cobalt, diamonds, gold, gypsum and phosphates, but reserves have yet to be fully surveyed and only iron ore is exploited industrially. Recent exploration has discovered oil under the seabed off Nouakchott. Mauritania s coastal waters constitute one of the world s richest fishing grounds. To improve the climate for inflow of investment, the 1989 investment code is continuously being updated to address the needs of foreign investors. In 1998, the mining code was updated and a new commercial code was drafted in Mauritania has also instituted measures to address investment disputes as well as respect property rights. Mauritania is signatory to the procedures of arbitration through World Bank Group's Convention on the Settlement of Disagreements Related to Investments between states and citizens of other states and the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Mauritania is a member of the Multilateral Investment Guarantee Agency and the African Organization of Intellectual Property. In addition, Mauritania subscribes to the Paris Convention for the Protection of Industrial Property, the Berne Convention for the Protection of Literary and Artistic Works and the World Intellectual Property Organization. Mauritania has a number of bilateral investment agreements and wide access to global markets. It has a bilateral investment agreement with member countries of the Arab Maghreb Union as well as Saudi Arabia. It has also signed three fisheries agreements with the European Union (EU) and the Cotonou Agreement for the renegotiation of the African Caribbean and Pacific EU convention, the Lomé Convention. Mauritania is a member of the African Union, New Partnership for Africa's Development, eligible for the Everything But Arms initiative and the United States' market access initiative for African countries the Africa Growth and Opportunity Act. Posted November 2006

2 B. Statistics on FDI and the operations of TNCs

3 Table 1. Summary of FDI Variable Inward Outward 1. FDI flows, (annual average) FDI flows as a percentage of GFCF, (annual average) FDI stock, FDI stock as a percentage of GDP, Source: Based on tables 3a, 4 and UNCTAD, FDI/TNC database.

4 Year Equity Table 3a. FDI flows, by type of investment, Inward investment Intracompany Reinvested earnings loans Total Equity Outward investment Intracompany Reinvested earnings loans Source : UNCTAD, FDI/TNC database. Note : FDI inflows: IMF for and 1998, OECD for , 1999 and 2004, IMF country report October 2003 No. 03/314 for 2003 and estimate for FDI outflows: IMF for and proxy for , 2000 and Proxy is based on investments reported by the following economies: 1992 Belgium and Luxembourg and France, 1993 and France, 1994 Belgium and Luxembourg, France and China, 1998 and 2000 Malaysia, 2003 United States. Total

5 Year Table 4. FDI stock, by type of investment, Inward Investment Equity Reinvested earnings Intracompany loans Outward Investment Total Equity Reinvested Intracompany earnings loans Total Source : UNCTAD, FDI/TNC database. Note : FDI inward stock: Estimated by accumulating inflows since FDI outward stock: Estimated by accumulating inflows since 1986.

6 Table 6. FDI flows in the host economy, by geographical origin, Economy Belgium / Luxembourg France Germany Portugal United States Source: UNCTAD, FDI/TNC database. Note: Data are based on information reported by the economies listed above. Table 9. FDI flows abroad, by geographical destination, Economy Belgium / Luxembourg China France Lithuania Malaysia United States Source: UNCTAD, FDI/TNC database. Note: Data are based on information reported by the economies listed above. Table 12. FDI stock of the United States in Mauritania, Economy United States Source: UNCTAD, FDI/TNC database. Note: Data are based on information reported by the United States. Tables 23, 30 and 45. The number, assets and sales of foreign affiliates of United States TNCs in Mauritania, (Number, thousands of employees and millions of dollars) Table no. Variable Number Assets Sales Source: UNCTAD, FDI/TNC database. Note: Data are based on information reported by the United States.

7 Table 88. Largest affiliates of foreign TNCs in the host economy, 2004 (Millions of dollars and number) Company Home economy Industry Sales Employees A. Industrial Elf Oil Mauritanie France Petroleum a Agence Mauritanienne aux Missions d'assistance Switzerland Mining and quarrying.... Mauritano Francaise des Ciments Italy Non-metallic mineral products.... B. Tertiary Société Mauritanienne des Télécommunications France Telecommunications a Sogeco France Other business activities b Souliemane Ould Choumad France Construction.. 28 b Administradora de Condominios Metepec Mexico Real estate.... Maersk Mauritanie Denmark Transport and storage.... C. Finance and Insurance Assets Employees Banque de Mauritanie Belgium Finance 85.. a Sources: The Banker's Almanac, 2003 (London, Reed Information Services Ltd, 2003); Thomson Analytics ( Who Owns Whom database ( a b Estimate.

8 C. Legal frameworks for transnational corporations The activities of transnational corporations and foreign direct investors are regulated through several national, bilateral and multilateral legal instruments. The following key legal instruments apply in the country: I. National framework Investment Code. Ordinance No /CSM concerning the Investment Code of 23 January Repeals Ordinance No. 79/046 of 16 March 1979 and as amended by Ordinance 366 of 7 May Source: Official Journal of the Islamic Republic of Mauritania of 22 February Ordinance of 30 December New Banking Regulations. Repeals Ordinance of 20 April Source: MOCI 1024/11 May Law No of 24 January 1994 amending the Tax Code and creating the Value Added Tax; effective on 1 January 1995 Source: CEPEX Africa-Actualities No. 442 of September Also in Editions Fiduciaries France- Afrique. Law No Mining Code of 30 July Source: Unofficial translation. Chambre de Commerce Franco-Arabe (Paris). Documentary Fund. II. International Framework A. Mauritania is a party to the following multilateral and regional instruments: Paris Convention for the Protection of Industrial Property of 1883 (Revised at Brussels in 1900, Washington in 1911, The Hague in 1925, London in 1934, Lisbon in 1958 and Stockholm in 1967, and as amended in 1979). Signed in Convention on the Settlement of Investment Disputes between States and Nationals of other States of Entered into force on 14 October 1966 Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958, which entered into force on 7th June Convention Establishing the Multilateral Investment Guarantee Agency of 1985, entered into force on 12 April Marrakesh Agreement Establishing the World Trade Organisation of 15 April Entered into force on 1 January Agreement on Trade-Related Investment Measures. General Agreement on Trade in Services. Agreement on Trade Related Aspects of Intellectual Property Rights. Fourth ACP - EEC Convention (Lome IV) of 1989, entered into force on 1st March Partnership Agreement between the Members of The African, Caribbean and Pacific Group of States, of the one part and the European Community and its member states, of the other part signed in Cotonou, Benin on 23 June Unified Agreement for the Investment of Arab Capital in the Arab States of 1982.

9 Convention Establishing the Inter-Arab Investment Guarantee Corporation of May 1971; entered into force in April Agreement for the Promotion, Protection and Guarantee of Investment Among Member States of the Organization of Islamic Conference, of I June 1981; entered into force on 23 September Articles of Agreement of the Islamic Corporation for the Insurance of Investment and Export Credit of 19 February Entered into force on 1 August B. Bilateral treaties 1. Bilateral investment treaties for the protection and promotion of investments: Switzerland 1976, Germany 1982, Belgium / Luxembourg 1983, Tunisia 1986, Romania 1988, Burkina Faso 2001, Cameroon 2001, Ghana 2001, Guinea 2001, Mauritius Bilateral treaties for the avoidance of double taxation : France 1967, Senegal 1971.

10 D. Sources of Information A. Official.. B. Secondary Busse, Mathias (2003). "Democracy and FDI", Discussion paper, 220 (Hamburg: Hamburg Institute of International Economics). Economist Intelligence Unit (EIU) (2002a). Country Profile: Mauritania (London: EIU Ltd.). (2002b). Country Report: Mauritania (London: EIU Ltd.), September. (2005a). Country Profile: Mauritania (London: EIU Ltd.). (2005b). Country Report: Mauritania (London: EIU Ltd.), September. Igue, J. (1992). L'Etat entrepot au Benin: Commerce informel ou solution a la crise (Paris: Karthala). Eid Florence and Fiona Pana (2003). "Foreign direct investment in Arab World: The changing investment landscape" ( Frick, C (2002). Direct foreign investment and the environment: African mining sector (Paris: OECD). International Monetary Fund (IMF) (1999). Mauritania: Enhanced structural adjustment facility Medium- Term Economic and Financial Policy Framework paper (Washington D.C.: IMF). (2006). IMF's Sub-Saharan Africa Regional Economic Outlook, March 10, (Washington D.C.: IMF). Martine, Ivan (2000). "The Euro-Mediterranean Partnership and Inward FDI in Maghreb countries"; First Mediterranean Social and Political research meeting Florence, March 22-26, Soderbom, M. and F. Teal (2004). "Size and Efficiency in Africa Manufacturing firms: Evidence from Firm -Level Panel Data." Journal of Development Economics, 73. pp United Nations Conference on Trade and Development (UNCTAD) (2002). FDI in Least Developed Countries at a Glance (Geneva: UNCTAD) ( pdfs/countries/benin.pdf). (2005a). Investor-Disputes Arising from Investment Treaties: A Review. UNCTAD Series of International Investment Policies for Development (UNCTAD/ITE/IIT/2005/4). (2005b). A Survey of Support by Investment Promotion Agencies to Linkages. Advisory Studies No. 18 (UNCTAD/ITE/IPC/2005/12). (2005c). FDI in least developed countries at a glance: 2005/2006 (UNCTAD/ITE/IIA/2005/17). United States Trade Representative (2006) Comprehensive Report on U.S. Trade and Investment Policy Toward Sub-Saharan Africa and Implementation of the Africa Growth and Opportunity Act: The Sixth of Eight Annual Reports, May (Washington D.C.: US Government).

11 World Trade Organization (WTO) (2992). "Enhanced international assistance would help Mauritania reap more benefits from its trade liberalization efforts" (Geneva: WTO). Razin, Assaf (2003). "The contribution of FDI flows to domestic investment in capacity, and vice versa", mimeo.

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