A relative latecomer to telecommunications reform, Mauritania, a low-income country of 2.5 million inhabitants on the Western edge of the Sahara, embarked on tan ambitious telecommunication reform in 1998. At that time, this largely desert nation had one of the lowest penetrations of telephony in the world. The immediate reform objectives were to ensure rapid improvement of telecommunications service availability through a) opening the sector to competition
and b) privatization of the state-owned telecommunications operator in Mauritania. Launched within an overall program of macroeconomic and structural reforms assisted by the World Bank, the telecommunications reform agenda faced several risks and constraints: 1) a virtual lack of institutional capacity and experience in privatization and regulation of utilities in a competitive framework
2) the country's lack of name recognition, and poor investor perception of country risk and commercial attractiveness
and 3) with the onset of the East Asian financial crisis and increasing indebtedness of major European telecommunications operators in 2000, a highly challenging environment for attracting new capital into high-risk emerging market telecommunications sectors.