Mauritius economic outlook

Mauritius, a picturesque island nation known for its pristine beaches and vibrant tourism sector, is now setting its sights on diversifying its economy and attracting investments in high-value sectors. In a recent interview with CNBC Africa, Kervin Ramsahye, Manager at Global Markets Sales for Standard Bank Group, shed light on the current investment landscape in Mauritius and the emerging trends shaping the country's economic outlook. Ramsahye highlighted the significant growth and resilience of the tourism sector in Mauritius, with the country expecting to welcome 1.3 million tourists this year, approaching pre-pandemic levels. The tourism industry has also reported record-high revenue, positioning Mauritius as an attractive and competitive destination. Additionally, the government has unveiled a 10-year blueprint to further enhance the tourism sector and attract new hotel projects, indicating lucrative investment opportunities in the sector. Apart from tourism, Ramsahye pointed out the increasing inflows in the real estate sector, driven by the demand for premium visas and long-term stays in Mauritius. The country is also making strides in renewable energy, with a roadmap to achieve 60% renewable energy by 2030, paving the way for significant investments in the sector. Financial institutions are offering loans and sustainable bonds following ESG principles, signaling a potential boom in renewable energy investments. In line with Mauritius' investment policy review, there is a shift towards high-value sectors like financial services, business services, and information technology. The country's well-established financial services sector has been a key driver of economic growth, offering high-quality services to global clients. Furthermore, the education sector is witnessing growth with the establishment of universities, providing high-level education to individuals across Africa. From a foreign exchange perspective, Mauritius' currency, the rupee, has shown resilience against the dollar, with the central bank intervening to stabilize its value. The Rupee has been trading around 44 to the dollar, with expectations of remaining strong due to robust inflows from key sectors like tourism, finance, and real estate. Looking ahead, Ramsahye sees opportunities for emerging markets in Southern Africa, with potential investments flowing in as a result of rate cuts in the US and ECB. However, he cautions that small economies like Mauritius may face risks if investors favor stronger currencies over African and emerging market currencies. On the inflation front, Mauritius is grappling with high inflation rates, currently at around 6%. The Monetary Policy Committee has maintained interest rates at 4.5% to support the economy, with inflation projected to reach 7% by the end of the year before dropping to 4% in the following year. In conclusion, Mauritius is poised for economic growth and investment diversification, with opportunities in tourism, real estate, renewable energy, financial services, and education sectors. The country's resilience in the face of global economic challenges and strategic initiatives to attract investments bode well for its long-term economic outlook.