Political sketch
Formerly part of French West Africa. Independent from France on 28 November 1960.
The Portuguese visited Mauritania in the 1400s and founded the fort of Arguin. The Senegal treaty of 1817among European powers recognized Mauritania as part of France's sphere of influence. A Franco-Spanish agreement of 27 June 1900 further recognized French control over territories between Río de Oro (later Western Sahara) and the Senegal River. Mauritania became a French protectorate in 1903. It was detached from Senegal in October 1904 and made a civil territory, part of French West Africa. It became a colony on 1 January 1921 with the city of Saint-Louis (now in Senegal), at the mouth of the Senegal River, as its capital; the capital was moved to its present location of Nouakchott in 1957. Under French rule Mauritania remained a largely nomadic economy. During the Second World War, French West Africa initially adhered to the French government of Vichy, which was something between neutral and allied with Germany, but on 23 November 1943, about two weeks after the Allied invasion of French Morocco and Algeria, it switched allegiance to the Free French government and joined the Allies.
Mauritania became autonomous on 28 November 1958 as the Islamic Republic of Mauritania. It became independent on 28 November 1960, in the great wave of French African colonies that year. Its first president, Moktar Ould Daddah, was ousted in a military coup in July 1978. Mauritania invaded the southern part of Western Sahara in 1976, but after its military performed badly it renounced its claim and signed a peace agreement with Western Sahara's pro-independence Polisario Front. Morocco, which had invaded the northern part of Western Sahara, subsequently annexed the region. In 1980 a civilian government replaced the military government. In February 1980, Islamic principles were adopted as the basis for the legal system, and in 1990 Arabic was adopted as the language to be used in all government business. In July 1980, slavery of blacks, practiced by northern nomads, was officially abolished; there have since been reports that slavery continues to be practiced, though. Violence between Arabic speakers and speakers of other languages broke out in April 1989. Mauritania has had multiparty elections since 1992; they have become less marked by irregularities over time. The main exports are iron ore and fish. Oil was discovered off the coast of Mauritania in 2001 and is likely to become a major export.
Wars since 1500
Tukulor-French Wars, 1854-1864; Spanish Saharan War, 1976-1980 (against Algerian-supported guerillas of the Polisario Front); Senegalese Border War of 1989-1991.
Convertibility
The French franc zone:
When the First World War began, France imposed a moratorium of payments on all negotiable instruments starting 1 August 1914. The moratorium was subsequently extended by decrees until 1 March 1915. The central bank, the Bank of France, abandoned the gold standard on 5 August 1914, although no official prohibition on exporting gold existed until by a decree of 3 July 1915, affirmed by a law of 15 November 1915. A decree of 2 April 1918 prohibited capital exports without authorization. A law of 25 June 1928 officially restored the gold standard and repealed exchange controls. When the French franc was an object of currency speculation , a law of 13 August 1936 imposed extensive exchange controls, supplementing some lesser measures that had been implemented in 1935.
France imposed exchange controls on 9 September 1939 by a decree of that date, soon after the Second World War broke out. On 20 May 1940, capital controls within the franc zone were greatly relaxed by a French decree of that date. Exchanges between France and its African colonies were cut off from the time of the Allied invasion of French Morocco and Algeria in November 1942 to about September 1944, by which time the Allies had liberated Paris and the main French port cities. Exchange controls within the franc zone were not removed until 6 June 1946. Afterwards, the CFA franc became convertible both for current- and capital-account transactions within the French franc zone (France, Monaco, And French possessions, including countries using the CFA franc). Outside the French franc zone it became convertible for current-account transactions when France resumed current-account convertibility, but it was not convertible for capital-account transactions. France had multiple exchange rates from 26 January 1948 until 17 October 1948, and a dual exchange rate from 18 October 1948 to 29 September 1949. On 20 September 1949 it devalued the French franc and unified the exchange rate, taking advantage of the lead offered by the United Kingdom, which had devalued the pound sterling on 18 September 1949.
The CFA franc zone:
All independent countries belonging to the CFA franc zone except Mali issued laws or decrees stating that effective 1 July 1967, financial relations with foreign countries were in principle free. Madagascar (then called the Malagasy Republic) issued similar legislation on the same date; Mali waited until 29 March 1968. The CFA franc zone countries were following earlier French legislation (France, Law No. 66-1007, 28 December 1966; Decree No. 67-78, 27 January 1967, effective 31 January 1967). France reintroduced exchange controls on 29 May 1968, during a period of strikes and riots (France, Decree No. 68-481, 29 May 1968). It removed controls on 4 September 1968 (France, Decree No. 68-788, 4 September 1968) but reimposed them on 25 November 1968 (France, Decree No. 68-1021, 24 November 1968) before revoking them on 1 January 1969. The CFA franc zone countries, including Madagascar, all strengthened their exchange controls against countries outside the French franc zone in 1968, following France, and loosened them in January 1969. France introduced a dual exchange rate on 21 August 1971 for itself and its French franc zone territories, which excluded Djibouti (France, Ministry of Economy and Finance, Circulaire du 20 août 1971 relative à l'exécution des transferts à destination de l'étranger, 20 August 1971). The CFA franc zone countries, including Madagascar, followed suit on these dates in 1968: Cameroon and Congo-Brazzaville, 28 August; Burkina Faso (then called Upper Volta) and Côte d'Ivoire (Ivory Coast), 30 August; Gabon and Senegal, 31 August; Mauritania, 1 September; Chad, 3 September; Madagascar and Niger, 4 September; Togo, 7 September; Central African Republic, sometime in September; Benin (then called Dahomey) and Mali, 9 September. All except Madagascar and Mauritania abolished the dual market on 21 March 1974, the same day as France (France, Ministry of Economy and Finance, Circulaire du 20 mars 1974 relative à l'exécution des transferts entre la France et l'étranger sur le marché officiel des changes, 20 March 1974). Madagascar had withdrawn from the French franc zone effective 1 July 1973, and its dual market had ended on that date. Mauritania had introduced a new national currency on 29 June 1973 to replace the CFA franc, and its dual market had ended on that date. The dual exchange rate did not apply to transactions within the French franc zone, so purchases and sales of French francs for CFA francs continued to be made at a single rate, the official rate, which was a pegged rate. Certain purchases and sales of currencies outside the French franc zone had to be made at the so-called financial rate, which was a floating rate.
Reinhart and Rogoff (2002) note a small premium in the dual market from 9 September 1971-21 January 1974 (by my non-overlapping system of dates; 22 January 1974 by their overlapping system). The premium existed because France established a dual rate, and so as not to create loopholes in the French franc zone, the CFA franc countries established dual exchange rates in imitation of France.
Mauritania alone:
Mauritania established exchange rate controls with the French franc zone on 29 November 1972 (Mauritania, Presidential Decree No. 72-250, 27 November 1972; Order No. 781 and 782, both 29 November 1972; Ministry of Finance, Circulars Nos. 2, 3, 4, 5, 6, 7, 8, 9, 10, all 29 November 1972). Mauritania left the French franc zone on 9 July 1973. Upon introducing its own currency on 29 June 1973, Mauritania ended the dual exchange rate against currencies outside the French franc zone that had been in effect since 1 September 1971.
Other
The French government established the CFA franc on 26 December 1945. The CFA franc became the unit of account in French colonies in sub-Saharan Africa and the Americas that had previously used a local franc equal to the French franc. Local francs in North Africa (Algeria, Tunisia, and Morocco) and Djibouti remained in effect fully attached to the French franc. French colonies in the Pacific established a unit of account called the CFP franc, while Indochina, Syria and Lebanon, and Pondicherry (India) already had currencies that were not called francs. The CFA franc enabled the French government to make exchange rate policy in the colonies different from that in France. When making devaluations of the French franc against gold and the US dollar on 26 December 1945 and 17 October 1948, the French government devalued the CFA franc less, implying a revaluation against the French franc. The meaning of "CFA" was initially Colonies Françaises d'Afrique (colonies of France in Africa). In Africa, the meaning changed when the colonies established central banks in preparation for political independence. CFA came to mean Communauté Financière Africaine (African financial community) for the member countries of the Banque Centrale des États de l'Afrique de l'Ouest (BCEAO, opened 4 April 1959). It came to mean Coopération Financière en Afrique Centrale (financial cooperation in Central Africa) for the member countries of the Banque Centrale des États de l'Afrique Équatoriale et du Cameroun (BCEAC, also opened 4 April 1959), which since 22 November 1972 has been called the Banque des États de l'Afrique Centrale (BEAC).
Defaults on or restructurings of debt to the private sector (mainly from Purcell and Kaufman 1993 and Standard & Poor's 2004): 1992-1996 (foreign currency bank debt).
Reinhart and Tokatlidis (2000: 33) dating of recent financial liberalization: Domestic (notably interest rates) 1990, external (notably foreign-exchange market and participation by foreign financial institutions) 1995.
Banking crises (data since 1970s mainly from Caprio and Klingebiel 1999 and Frydl 1999): A crisis 1984-1993; at the start of the period, five major banks had nonperforming loans of 45-70% of their portfolio.
Frankel and Rose (1996) list of currency crashes: None.
References
Primary sources:
--Laws and decrees:
France. Gazette. 1762-present. Gazette de France (1762-1789); Gazette nationale de France (1789-1799); Bulletin des lois (1791-1831; a separate publication); La gazette nationale ou le moniteur universel (1799-1810); Moniteur universel (1811-1848); Moniteur universel: journal officiel de la République française (1848-1852); Journal officiel de l'Empire français (1852-1870); Journal officiel de la République française (1871-1941); Journal officiel de l'État français (Vichy France, 1941-1944); Bulletin officiel des Forces françaises libres (Free France, 1940-1941); Journal officiel de la France libre (Free France, 1941); Journal officiel de la France combattante (Free France, 1941-1943); Journal officiel du Haut commissariat de France en Afrique (Free France, 1943); Journal officiel du Commandement en chef français en Afrique (Free France, 1943); Journal officiel de la République française (Free France, 1943-1944; France, 1944-present). Paris (1762-1940, 1944-present); Vichy (1940-1944); London (Free France, 1941-1943); Algiers (Free France, 1943-1944): Imprimerie des Journaux Officiels (1944?-present). Many issues are in France, Legifrance Web site (see below).
France. Legifrance Web site, <http://www.legifrance.gouv.fr>. Reference site for French treaties, laws, and decrees, including the full text for recent items.
France. Overseas gazette. 1887-1961. Bulletin officiel (1887-1953; new series, 1953-1959); Bulletin officiel de l'administration provisoire des services du Ministère de la France d'Outre-Mer (1959-1961). Issued by Ministère des Colonies (1887-1950); Ministère de la France d'Outre-Mer (1950-1961). Paris: Imprimerie Nationale.
French West Africa. Gazette. 1895-1959. Journal officiel de l'Afrique occidentale française. Saint-Louis, Senegal (1895-1905?); Gorée (1905-?); Dakar (?-1959). (Successor to Senegal gazette for Mauritania; succeeded by Mauritania gazette.)
Mauritania. Gazette. 1959-present. Journal officiel de la République islamique de Mauritanie. Nouakchott: Direction Générale de la Législation, de la Traduction et de l'Édition; later Direction du Journal Officiel.
Senegal. Gazette. 1856-1904. Le moniteur du Sénégal et dépendances, journal officiel (1856-1859, 1864-1888?); Journal officiel du Sénégal (1888-1904. Saint-Louis, Senegal (1856-1959, 1864-1888 and beyond); later Rufisque: Imprimerie Nationale. (Apparently succeeded by French West Africa gazette in 1904.)
--Publications of monetary authorities:
Banque Centrale de Mauritanie (Al-Jumhriya al-Islmya al Mritanya). Annual report. 1976?-present. Compte-rendu des opérations relatives à l'exercise allant du 1er janvier au 31 décembre ... (1976?-1977); Rapport annuel. (1978?-present). Nouakchott: Banque Centrale de Mauritanie. (The central bank began in 1973 but I have not seen reports from its first years.)
Banque Centrale de Mauritanie (Al-Jumhriya al-Islmya al Mritanya). Bulletin. 1975-1995? Bulletin statistique (1975-after 1978); Bulletin trimestriel de statistique (by 1982-1995?). Nouakchott: Banque Centrale de Mauritanie. (No longer published.)
Banque de l'Afrique Occidentale. Annual report. 1901/1902-1964/1965. Assemblée générale ... procès-verbal et rapport du conseil d'administration. Paris: Banque de l'Afrique Occidentale.
Banque de l'Afrique Occidentale. Bulletin. 1956-1965? Bulletin économique et financier France-Afrique noire. Paris: Banque de l'Afrique Occidentale.
Banque du Sénégal. Annual report. 1855/1856-1900/1901. Assemblée générale. Paris?: Banque du Sénégal.
BCEAO. Banque Centrale des États de l'Afrique de l'Ouest. Annual report. 1959-present. Rapport d'activité (1959-1989); Rapport annuel (1990-present). Paris (1959-1977); Dakar (1978-present): Banque Centrale des États de l'Afrique de l'Ouest.
BCEAO. Banque Centrale des États de l'Afrique de l'Ouest. Bulletin. 1959-present. Notes d'information et statistiques. Paris (1959-1978); Dakar (1978-present): Banque Centrale des États de l'Afrique de l'Ouest.
IEAOFT. Institut d'Émission de l'Afrique Occidentale Française et du Togo. Annual report. 1955/1956-1958. Rapport d'activité. Paris: Institut d'Émission de l'Afrique Occidentale Française et du Togo.
IEAOFT. Institut d'Émission de l'Afrique Occidentale Française et du Togo. Bulletin. 1956-1959. Notes d'information et statistiques. Paris: Institut d'Émission de l'Afrique Occidentale Française et du Togo.
--Web site of the current monetary authority (viewed 20 September 2005):
<http://www.bcm.mr>
--Other publications or Web sites:
Comité Monétaire de la Zone Franc. Secrétariat. 1953-present. Premier [etc.] rapport annuel du Comité de la zone franc établi en exécution du décret du 5 fevrier 1952 (art. 4, §2) (1953-1956); La zone franc en 1957: cinquième rapport annuel du Comité Monétaire de la Zone Franc (1957); La zone franc en ...: rapport publié par le Secrétariat du Comité Monétaire de la Zone Franc (1958-1983); La zone franc: rapport ...: publié par le Secrétariat du Comité Monétaire de la Zone Franc (1984-1991); La zone franc: rappport annuel ...; publié par le Secrétariat du Comité Monétaire de la Zone Franc (1992-2003; inside page says La zone franc en ...); Rapport annuel de la zone franc (2004-present; inside cover says La zone franc: rapport annuel ...). Paris: Imprimerie Nationale (1953-1956); Secrétariat du Comité Monétaire de la Zone Franc (1957-1991; 1957 is a mimeo with no explicit publication information); Banque de France (1992-present). Recent issues are available on the Web site of the Banque de France, <http://www.banque-france.fr/fr/eurosys/zonefr/zonefr.htm>.
France. Commision de Surveillance des Banques Coloniales. 1875-1939. Rapport au président de la république sur les opérations des banques coloniales d'émission pendant l'exercise ... (1873/1874-1936/1937); Rapport au président de la république sur les opérations des banques coloniales d'émission ... (1927/1929-1936/1937). Paris: Imprimerie Nationale.
Main secondary sources:
Alibert, Jacques. 1983. De la vie coloniale au défi international: Banque du Sénégal, BAO, BIAO, 130 ans de banque en Afrique. Paris: Chotard et Associés Éditeurs.
Gérardin, Hubert. 1989, 1994. La zone franc. Tome 1: histoire et institutions. Tome 2: La dynamique de l'intégration monétaire et ses contraintes. Paris: Éditions L'Harmattan.
IMF ARER. 1950-present. International Monetary Fund. Annual Report on Exchange Restrictions (1950-1978), Annual Report on Exchange Arrangements and Exchange Restrictions (1979-1988), Exchange Arrangements and Exchange Restrictions: Annual Report (1989-present). Washington: International Monetary Fund. (Contains information on IMF member countries and some of their dependencies.)
Leduc, Michel. 1965. Les institutions monétaires africaines: pays francophones. Paris: Éditions A. Pedone.
Monetary authorities: Mauritania
| Dates | Type | Name | Source | Remarks |
| 4 August 1855
-30 September 1955 |
private monopoly issue (as part of a currency union) | Banque du Sénégal (headquarters Saint-Louis, Senegal) / Banque de l'Afrique Occidentale (headquarters Paris, France) from 1 July 1901 | France, imperial decree of 21 December 1853 (establishing Banque du Sénégal); decree of 29 June 1901 (establishing Banque de l'Afrique Occidentale); law of 29 January 1929 (extending its charter for 20 years and introducing minority government ownership); both reprinted in BCEAO (2000, v. 1: 220-33, 301-3, 380-3) | The Banque du Sénégal opened in Saint-Louis, Senegal, on 4 August 1855, just over the border from Mauritania. It was the first bank in the vast expanse of western and equatorial Africa that became French colonies. It and its successor the Banque de l'Afrique Occidentale e banks were established to be note issuers for all of French West and Equatorial Africa. Not until 1959 did the bank did establish a Mauritanian branch, in Nouakchott. The Banque du Sénégal was established as a way of compensating slave owners after slavery was abolished in French colonies; slave owners received some original shares in the bank. The Banque de l'Afrique Occidentale was established as the successor to Banque du Sénégal to tap capital on a wider basis and establish a bigger branch network than its predecessor. The first bank in Mauritania proper was the Banque Nationale pour le Commerce et l'Industrie-Afrique (headquarters Paris, France), in Akjoujt, apparently in 1954 (Comité Monétaire de la Zone Franc annual report 1954: 104). During the First World War, individual colonies in French West Africa issued |
| 1 October 1955
-3 April 1959 |
joint monetary institute (as part of a currency union) | Institut d'Émission de l'Afrique Occidentale Française et du Togo (IEAOFT) (headquarters Paris, France) | France, Decree No. 55-103, 20 January 1955; Decree No. 55-938, 15 July 1955; interministerial arrêté of 29 September 1955 | France nationalized the note issue in accord with its policy since the 1930s. France, decree of 31 August 1957, transferred issuance of coins from the French Treasury to the IEAOFT effective 1 October 1957. Notes for different member countries were issued with different serial number codes to provide a basis for calculating each country's share of seigniorage. |
| 4 April 1959
-27 June 1973 |
joint central bank (as part of a currency union) | Banque Centrale des États de l'Afrique de l'Ouest (BCEAO) (headquarters Paris, France) | France, Ordonnance No. 59-491, 4 April 1959 | The monetary institute was converted into a central bank to prepare for imminent independence of its members. French influence was reduced by the Traité instituant une Union monétaire ouest-africaine and the Accord de coopération entre la République française et les Républiques membres de l'Union monétaire ouest-africaine, both signed in Paris 12 May 1962. Notes for different member countries continued to be issued with different serial number codes to provide a basis for calculating each country's share of seigniorage. Mauritania joined the IMF on 10 September 1963. It announced on 28 November 1972 that it would issue its own currency. |
| 28 June 1973
-16 September 1973 |
government issue | government of Mauritania (headquarters Nouakchott, Mauritania) | Mauritania, Law No. 73.118, 30 May 1973, cited in Banque Centrale de Mauritanie annual report (1978: first page, not numbered); BCEAO annual report 1973: ix; BCEAO (2000, v. 2: 332-3) | Mauritania broke away from the CFA franc zone as part of a broader policy of seeking to reduce French influence over its policies. The BCEAO transferred responsibility for issuance of the currency to Mauritania's government at the start of 28 June 1973, while the transfer of assets and liabilities to the Mauritanian government occurred on 9 July 1973. The government treasury carried out the initial operations in establishing Mauritania's national currency because the central bank had not yet begun operations. |
| 17 September 1973
-present (2005) |
central bank | Al-Jumhriya al-Islmya al Mritanya or Banque Centrale de Mauritanie (headquarters Nouakchott, Mauritania) | Mauritania, Law No. 73.118, 30 May 1973, cited in Banque Centrale de Mauritanie annual report (1978: first page, not numbered); BCEAO (2000, v. 2: 332-3) | Mauritania's central bank did not officially begin operations until 1 July 1973 and not actually until 17 September 1973. The central bank issues coins as well as notes. |
Exchange rate arrangements: Mauritania
| Dates | Official arrangement | Source | Unofficial arrangement, if different | Remarks |
| 7 December 1826
-3 August 1855 |
fixed; used French franc | France, Règlement du Commandant et Administrateur du Sénégal et Dépendences, 15 June 1826, cited in Leduc (1965: 13) | The 1826 regulation forbade colonial units of account; only legally admitted monies or French money was allowed in administrative, judiciary, or commercial activities. BCEAO (2004) implies that the regulation came into effect on 7 December 1826. French African colonies admitted British coins and in some instances silver Maria Theresa thalers as legal tender up to the mid 1920s, and perhaps later in some cases. France, royal ordinance of 17 August 1825, authorized special bronze 5 and 10 centime coins for Senegal, which were made legal and even forced tender (France, arrêté of 16 August 1826). However, after 1840 no special coins were minted for France's African colonies until 1944; the colonies used French coins. The French franc was a decimal currency. | |
| 4 August 1855
-22 November 1943 |
pegged (as part of a currency union); 1 local franc = 1 French franc | BCEAO (2000, v. 1: 233) | The Banque du Sénégal established its headquarters in Saint-Louis, at the edge of Mauritania, so the exchange rate changed from fixed to pegged. The bank's successor, the Banque de l'Afrique Occidentale, was required starting in 1929 to make exchanges between France and West Africa without commission fees other than the actual cost of post office or telegraph costs (France and Banque de l'Afrique Occidentale, agreement of 24 February 1927, article 8, reprinted in BCEAO 2000, v. 1: 378). Legally, local francs in what was to become the CFA franc zone were not separate from the French franc until 26 December 1945. | |
| 23 November 1943
-5 December 1944 |
pegged (as part of a currency union); 200 local francs = UKŁ1, or 50 local francs = US$1 | Anglo-Free French agreement of 2 February 1943, cited in Mazard (1953: 106) | By the agreement of 2 February 1943, in many of the areas under its control, the Free French government devalued local francs from pre-Second World War rates based on 176.625 French francs = UKŁ1, or 43.80 French francs = US$1. French West Africa switched allegiance from the Vichy French government to the Free French government on 23 November 1943. | |
| 6 December 1944
-25 December 1945 |
pegged (as part of a currency union); 1 local franc = 1 French franc | Anglo-Free French agreement of 8 February 1944, cited in Mazard (1953: 106) | Following the liberation of most of France by the Allies during the Second World War, the metropolitan French franc was devalued to the level of the overseas francs under Free French control (200 local francs = UKŁ1, or 50 local francs = US$1). Doing so in effect restored the French franc as the anchor currency. | |
| 26 December 1945
-16 October 1948 |
pegged (as part of a currency union); 1 (West African) CFA franc = 1.70 French francs | France, Decree No. 45-0136, 25 December 1945 | France created the CFA franc at premium from the former 1-to-1 rate of local francs with the French franc. The premium offset most of the French franc's devaluation from 50 to 119.10699 French francs = US$1 on 25 December 1945. The revaluation reflected lower wartime economic destruction in the colonies than in France. The new cross rate with the pound sterling was 300 CFA francs = UKŁ1. The name "franc" for the currency came from the French franc. For the meaning of CFA, see the category "Other" in the country information above. | |
| 17 October 1948
-31 December 1959 |
pegged (as part of a currency union); 1 (West African) CFA franc = 2 French francs | France, Ministry of Finance and Economic Affairs, Avis No. 352 de l'Office des Changes, 17 October 1948 | The CFA franc had followed the French franc's devaluation on 26 January 1948, but this time it was in effect revalued against the French franc to offset almost all of the French franc's devaluation from 214.392 to 264 French francs = US$1 on 17 October 1948. | |
| 1 January 1960
-31 August 1971 |
pegged (as part of a currency union); 50 (West African) CFA francs = 1 new French franc | France, Ordonnance No. 58-1341, 27 December 1958; Ministry of Finance and Economic Affairs, Circulaire du 19 novembre 1959 relative au nouveau franc, 19 November 1959; Decree No. 59-1450, 22 December 1959 | France redenominated its franc at 1 new French franc = 100 old French francs. Members of the CFA franc zone never registered gold parities with the IMF. Gold convertibility for all countries ended in practice when the United States abandoned the gold standard on 15 August 1971. | |
| 1 September 1971
-27 June 1973 |
pegged, dual rate (as part of a currency union); official rate 50 (West African) CFA francs = 1 French franc | IMF ARER (1972: 293) | The second rate, called the financial rate, was a managed or perhaps independent float. | Established a dual exchange rate following France's doing so on 21 August 1971. On 28 November 1972 Mauritania's president announced the intention to create a national curency outside of the franc zone (BCEAO annual report 1973: ix). |
| 28 June 1973
-21 January 1974 |
pegged; 10 Mauritanian ouguiyas = 1 French franc, or 1 Mauritanian ouguiya = 0.016g gold (nominally) | Mauritania, Law No. 73.118, 30 May 1973, reprinted in BCEAO (2000, v. 2: 328); decree of 28 June 1973, cited in BCEAO annual report 1973: x; IMF ARER (1974: 296, 298) | Mauritania broke away from the CFA franc zone as part of a broader policy of seeking to reduce French influence over its policies. It established a national currency at 1 Mauritanian ouguiya = 5 CFA francs and unified the exchange rate. Mauritania chose this exchange rate because the 5-franc piece had long been widely used in West Africa and was a popular unit of account. A subunit called the khoum was equal to one-fifth an ouguiya. I have not found the origin of the word "ouguiya," which apparently is Mauritanian. Mauritania never established a gold parity with the IMF, although the gold parity was established in national law. The exchange of new currency for old lasted until 15 July 1973. Mauritania ceased to belong to the French franc zone on 9 July 1973, when the BCEAO transferred responsbility for issuance of currency to Mauritania's government. The French franc initially remained the anchor currency (BCEAO annual report 1973: ix). | |
| 22 January 1974
-31 March 1978 |
flexible basket; official rate 1 Mauritanian ouguiya = 0.016g gold (nominally) | IMF ARER (1975: 327) | RR: Highly variable parallel market premium, ranging from zero to above 100%. De facto crawling band around US dollar; band width of +/-2%. | Switched to a basket after France ceased participation in the joint managed float [check French table when done to see if this is how it is described] of the Western European "snake" and floated the French franc against all currencies on 19 January 1974. Mauritania established a basket peg, initially with 16 currencies but later as few as five. The US dollar was the currency the central bank used for setting exchange rates with other currencies. The currencies were often specified (for instance, as of 2 May 1977 the basket consisted of the French franc, German market, Italian lira, Netherlands guilder, Spanish peseta, and US dollar, according to IMF ARER 1978: 277), but the weights of the currencies involved were not. |
| 1 April 1978
-1992 |
flexible basket (IMF: managed float from first quarter 1987) | International Monetary Fund, Board of Governors, Resolution No. 31-4, 30 April 1976 ("Second Amendment"); IMF ARER (1986: 357; 1987 343; 1989: 315; 1993: 329) | RR: Variable parallel market premium, ranging from zero to above 200%. De facto crawling band around US dollar; band width of +/-2% to October 1983; band width of +/-5% from November 1983. Parallel market premiums reached 257% in August 1992. | The system of gold par values officially ended by agreement of IMF members. However, Mauritania had never officially registered a par value. Mauritania revalued 2% against the basket in February 1982 and devalued 16% on 14 February 1985. There were also other devaluations in 1985, so that on 31 December 1985, 77.07 Mauritanian ouguiyas = US$1. There were several adjustments during 1986, such that on 31 December 1986, 74.43 Mauritanian ouguiyas = US$1. There were also several adjustments during 1988, taking the currency from 71.59 Mauritanian ouguiyas = US$1 at end of 1987 to 75.71 Mauritanian ouguiyas = US$1 at end of 1988. The currency was depreciated 6.59% against the US dollar on 1 October 1992 and 21.8% against the US dollar on 4 October 1992. The appendix of IMF ARER (1988-1991) classifies the exchange rate arrangement as "other managed floating" from an unspecified poin in 1987 onward, but the main text mentions a basket, therefore I have classified it as remaining a basket in this period. IMF ARER classifies the exchange rate arrangement as a basket before and |
| 1992
-31 December 1992 |
flexible basket, dual rate | IMF ARER (1993: 327, 593) | RR: Parallel market premium above 100% at year end. | Established a preferential exchange rate for remittances by Mauritanian workers abroad. The preferential rate was the average exchange rate for the quarter and was therefore pegged. |
| 1 January 1993
-30 December 1995 |
flexible basket | IMF ARER (1994: 325) | RR: Parallel market premium gradually falling to low single digits. De facto crawling band around US dollar; band width of +/-5% to August 1994. From September 1994, band width of +/-2%. Parallel market premium in single digits from May 1995. | Abolished the preferential exchange rate for remittances by Mauritanian workers abroad. |
| 31 December 1995
-29 April 1997 |
independent float | IMF ARER (1996: 315) | RR: Small parallel market premium. De facto crawling band around US dollar; band width of +/-2%. | Floated to eliminate the parallel market premium. |
| 30 April 1997
-present (2005) |
managed float | IMF ARER (1998: 582, 587) | RR: Small parallel market premium to December 1998, when data end. De facto crawling band around US dollar; band width of +/-2%. | The IMF reclassified the exchange rate. It did so because to reverse the real appreciation of the currency, from August 1997-August 1998 the central bank allowed a faster nominal depreciation against the US dollar, including a 13% depreciation for the month of July 1998 (Banque Centrale de Mauritanie annual report 1997: 43; IMF International Financial Statistics database, viewed 15 November 2005). Effective 17 April 2000 the central bank set the daily official rate at the rate determined in the Extended Exchange Market the previous day; previously the central bank had set a weekly central intervention rate and a band of +/-0.75% around it (IMF ARER 2001: 599, 603). On 1 August 2004 the central bank ceased foregin exchange auctions and began a direct intervention system accompanied by rationing of foreign exchange (IMF ARER 2005: 614). |