Mauritius Budget Deficit Rises Above 3% Estimate

Mauritius Budget Deficit Rises Above 3% Estimate

Last year, Mauritius finance minister Xavier Duval forecasted the budget deficit to linger around 2.2 percent of GDP, later increasing that estimate to 3 percent, Reuters reported.

Now, official projected figures are in and Mauritius’ 2013 budget deficit has landed at 3.7 percent.  An expansion of future economic growth is the plan for recovery and budget deficit shrinkage, the report noted — hopefully falling to 3.2 percent of GDP in 2014.

Also in 2014, the public sector debt to GDP ratio is expected to experience a drop reaching 54 percent, slightly lower than the 54.8 percent figure estimated for 2013.

Chamber of commerce and industry economist Renganaden Padayachy said in the Reuters report:

“Growth could improve next year on the back of the budgetary measures unveiled by the finance minister but also helped by a more stable global environment.”

Sluggish economic progression, tourism slumps and spending to tame flooding in the Indian Ocean contributed to the deficit spike, according to Reuters. Fortunately, the island has already prepped for such drops in revenue and sought out gains via medical tourism, real estate within the luxury sector, in addition to offshore banking business.

“The resilient performance of our economy is reflected by the stock exchange with a growth of 18 percent since the beginning of the year,” Duval said in the report.

“2013 is turning out to be another year of responsible fiscal management despite unexpected external shocks. The budget deficit is estimated at 3.7 percent of GDP of which 97 percent is due to investment expenditure,” he added.