40346

                        THE ISLAMIC REPUBLIC OF MAURITANIA
                            COUNTRY ASSISTANCE STRATEGY

                          CHAIRMAN'S CONCLUDING REMARKS

                         Meeting of Board of Executive Directors of IDA
                                          July 17,2007


      The Executive Directors considered the Country Assistance Strategy (CAS) for the Islamic
Republic of Mauritania. They appreciated that the CAS was developed in collaboration with IFC
and MIGA and in close coordination with other partners in the country.

      Directors commended the Government's efforts on re-establishing macro-budgetary
stability and promoting reform in the areas of governance and anti-corruption, public
administration and public financial management. They urged the authorities to continue to
maintain macro-economic stability, diversify the economy, build capacity and press ahead with
public administration reform.

      Directors welcomed the CAS emphasis on flexibility, selectivity, partnerships,
coordination, and results, particularly in light of limited IDA resources. They noted its main
pillars are aligned with the priorities identified by the Government in its second Poverty
Reduction Strategy Paper. However, Directors highlighted that many challenges still remain in
order to make progress towards attaining the MDGs and making the transition to a MIC country,
notably in light of the lower than expected oil revenues.

      Some Directors felt that the poverty objective is too ambitious. They urged the authorities
to elaborate a new rural development strategy and the Bank to address poverty issues,
particularly in rural areas, where most of the poor reside. Directors urged the authorities to pay
attention to potential sources of growth, beyond the exploitation of natural resources.

      Some Directors noted with concern the slowing down of poverty reduction in the country.
They urged the Government to pay greater attention to the diagnostics and drivers of poverty and
inequality at the national and local levels. Some Directors suggested that more analytical work
was needed to better address poverty reduction. Directors emphasized the importance of
fostering pro-poor growth supported by institutional capacity and infrastructure building. Some
Directors highlighted the need for the Bank to deepen its engagement in the health and education
sectors.

        Directors remarked that the main risks facing the implementation of the CAS are the
weak capacity in the public administration, vulnerability to external shocks, and improving the
business environment. They stressed that coordination and division of labor among the
development partners, including non-traditional donors, based on their respective comparative
advantages will be essential for the success of the strategy.