What is ‘MRO (Mauritanian Ouguiya)’
MRO is an abbreviation seen in the foreign exchange (FX) for the Republic of Mauritanian ouguiya, sometimes also spelled as the ougiya. A single ouguiya divides into five khoums. The Mauritanian Ouguiya (MRO) circulates alongside the Malagasy Ariary.
The Central Bank of Mauritania controls the issuance of banknotes and monetary policy for the country. In the currency world, the Ouguiya has an unusual characteristic. It has the rare distinction of being one of just a few currency systems that are not digital currencies, meaning it does not have units based on divisions of ten.
BREAKING DOWN ‘MRO (Mauritanian Ouguiya)’
The MRO is the official currency of nation of the Republic of Mauritanian, a country in northwestern Africa that sits along the Atlantic coast. It is made up mostly of a desert landscape with 90% of its landmass lying in the Sahara desert. Many of its residents have a nomadic lifestyle and abide by strict cultural traditions.
Nearly 50% of the nation’s gross domestic product comes from fishing, but Mauritania still imports 70% of its food sources. Agriculture and mining also contribute to the nation’s income as the majority of its citizens rely on livestock for income and survival. The Mauritania nation experienced several droughts and famine, which coupled with inadequate economic policy, led the country to build up massive foreign debt. Financial assistance through the International Monetary Fund and the World Bank have helped the nation. However, the country still struggles.
Portions of Mauritanian existed under various nomadic tribal rulers for many years until it became part of French West Africa in 1920. During the period of tribal rule, conflicts often flared between groups. Later, when the nation gained its independence in 1960, a new series of conflicts between culturally diverse groups ensued. Slavery remains a problem in the country, as well as an ongoing caste-like system of hierarchy and wide differences in the population’s income.
According to World Bank data, the Republic of Mauritanian has a population which is growing at a rate of 2.7% per year. The country experiences a 4.2% annual inflation rate and has a gross domestic product (GDP) growth of a 3.5%, as of 2017, which is the most current year of available data.
The MRO and the Currency Market
The Mauritanian Ouguiya (MRO) first began as the official currency of Mauritania in 1973. At this time, it replaced the CFA franc which is a currency used in areas of mainland Africa at a rate of 5 ouguiyas to 1 franc. Banknotes have denominations of 100, 200, 1,000, 2,000, 5,000 ouguiyas. Coins also circulate in values of 1 khoum, and 1, 5, 10, and 20 ouguiyas.
Most commonly the MRO pairs with the euro in the foreign currency exchange market. The Central Bank of Mauritania is in the process of adjusting the denominations of currency. Redenomination of the currency began in December 2017 at a central bank set rate of 1:10. These new notes are the second ouguiya. The second ouguiya, which is worth ten times its comparable version in the old system, began to go into circulation in January 2018. The currency in circulation will gradually transition to the new styles of coins and banknotes throughout 2018. Government officials said the new money is more durable and less prone to counterfeiting, making it safer and more secure. The updated currency designs also have a more modern and innovative style.