The Emir of Qatar, Sheikh Hamad bin Khalifa al-Thani, signed a deal to found a new airline in Mauritania during a visit to the West African nation.

The airline, whose name has not yet been announced, will be 60 percent controlled by Qatar's Al Bateel Group, 30 percent by Mauritanian investors and 10 percent by the Mauritanian state.

The visit by Sheikh Hamad, the first by a Gulf ruler since democratic elections last year, comes amid growth in investment by Arab nations in West Africa.

"The fleet of the new airline will be five planes: three Boeing 737 and two small planes for interior and regional flights," said Ahmed Ould Lefghih, secretary-general of the Mauritanian transport ministry.

Air Mauritania, the country's state-run airline, was liquidated in January, leaving more than 400 people unemployed who will be given priority for jobs at the new carrier.

Qatar Steel, a unit of Industries Qatar, announced last year it was taking a 50 percent stake in the $2.2 billion Guelb al Aouj iron ore project in Mauritania. The National Bank of Qatar has also opened its first branch in Mauritania.

State-owned real estate group Qatari Diar Real Estate Investment Co. has also agreed to build a $400 million complex involving a five-star hotel, villas, a conference centre and shops just north of Nouakchott. Other areas of cooperation were also mooted.

"There are several dossiers under discussion, notably in the sectors of water, education and rural electrification," said a presidency spokesman. "This visit should also relaunch the contacts over the future international airport at Nouakchott."    

The two countries have also signed double tax treaties and investment protection agreements.

Mauritania's economy has suffered a slowdown, partly due to an unexpected slump in oil production which started in February 2006. The economy expanded by 11 percent that year, but growth slumped to 0.9 percent last year due to technical problems at the Chinguetti field which slashed oil output.

Qatar Steel owns 49 percent of the El Aouj steel project in northern Mauritania, expected to produce 7 million tonnes of steel a year by 2011. - Reuters