IMF Executive Board Concludes 2024 Article IV Consultation with Mauritius
IMF News, May 16, 2024
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- Published: May 16, 2024
Economic rebound and recent performance
- Real GDP growth reached 8.9 percent in 2022 and an estimated 7 percent in 2023; output has now exceeded its pre-pandemic level.
- Real GDP growth by year (selected): 2.9 (2019), -14.5 (2020), 3.4 (2021), 8.9 (2022), 7.0 (2023), projected 4.9 (2024).
- Inflation averaged 7 percent in 2023, supported by lower international commodity prices.
- Consumer prices inflation (period average): 0.5 (2019), 2.5 (2020), 10.8 (2021), 7.0 (2023).
- Consumer prices inflation (end of period): 0.9 (2019), 2.7 (2020), 6.8 (2022), 12.2 (2023), 3.9 (2024), 5.1 (2025).
- External current account deficit narrowed sharply in 2023 to 4.5 percent of GDP.
Outlook and projections
- Real GDP growth projected at 4.9 percent in 2024 and around 3.5 percent in the medium term (in line with pre-pandemic growth).
- Headline inflation projected to ease to 4.9 percent on average in 2024 and 3.5 percent thereafter (in line with the Bank of Mauritius’ medium-term inflation target).
- External current account deficit expected to remain at 4.5 percent of GDP in 2024 and about 4 percent over the medium term.
- Public debt, estimated at 81 percent of GDP in June 2023, is projected to moderate over the medium term.
- Selected forward-looking indicators (projections from Table 1):
- Real GDP: 4.9 (2024), 3.7 (2025), 3.5 (2026), 3.3 (2027).
- GDP per capita (U.S. dollars): 11,408 (2019), 9,011 (2020), 9,087 (2021), 10,251 (2022), 11,417 (2023), 12,997 (2024), 14,025 (2025), 15,061 (2026), 16,045 (2027), 17,078 (2028), 18,157 (2029).
- Gross international reserves (millions of U.S. dollars): 7,354 (2019), 7,242 (2020), 7,805 (2021), 7,740 (2022), 7,254 (2023), 7,604 (2024), 7,954 (2025), 8,304 (2026), 8,654 (2027), 9,004 (2028), 9,354 (2029).
- Total external debt: 88.9 (2019), 110.7 (2020), 134.0 (2021), 132.0 (2022), 128.9 (2023), 119.8 (2024), 112.3 (2025), 105.4 (2026), 99.6 (2027), 93.8 (2028), 88.4 (2029).
Key macrofinancial indicators (selected exact figures)
- Current account balance: -5.0 (2019), -8.8 (2020), -13.0 (2021), -11.1 (2022), -4.5 (2023), -4.3 (2024).
- Exports of goods and services, f.o.b. (annual percent change): -5.9 (2019), -41.3 (2020), 56.7 (2021), 9.9 (2022), 13.3 (2023), 7.9 (2024).
- Of which: tourism receipts: -73.8 (2020), -23.8 (2021), 313.1 (2022), 29.7 (2023), 12.0 (2024), 6.9 (2025).
- Imports of goods and services, f.o.b. (annual percent change): -2.2 (2019), -29.1 (2020), 16.0 (2021), 32.9 (2022), -0.2 (2023), 12.3 (2024).
- Revenues (incl. grants) as percent of GDP: 22.1 (2019), 21.6 (2020), 24.1 (2021), 24.3 (2022), 24.2 (2023), 23.3 (2024), 23.0 (2025), 23.2 (2026).
- Expenditure, excl. net lending (percent of GDP): 33.5 (2019), 40.4 (2020), 31.0 (2021), 29.2 (2022), 28.9 (2023), 28.4 (2024), 27.3 (2025).
- Public sector debt, fiscal year (percent of GDP): 81.1 (2019), 91.9 (2020), 85.9 (2021), 81.2 (2022), 78.3 (2023), 78.1 (2024), 77.6 (2025), 77.3 (2026), 76.9 (2027).
Risks to the outlook
- Downside risks cited include:
- Deterioration in global growth.
- Higher-than-anticipated fuel and food prices.
- Extreme climate events.
- Structural vulnerabilities: eroded fiscal and external buffers during the pandemic; long-term vulnerabilities from climate change and an ageing population.
Executive Board assessment and policy recommendations
- Overall assessment:
- Directors welcomed Mauritius’ strong economic recovery and supportive policy response.
- Directors stressed that challenges and downside risks remain despite favorable growth outlook.
- Fiscal policy:
- Recommended a gradual and growth‑friendly fiscal consolidation over the medium term to rebuild fiscal buffers and further reduce public debt.
- Specific fiscal measures recommended: mobilizing tax revenue, containing current spending, and safeguarding critical social spending to protect the most vulnerable.
- Called for reforming the pension system and strengthening public financial management, including streamlining extra‑budgetary special funds.
- Welcomed the reinstatement of the public debt ceiling framework and recommended it be further strengthened.
- Monetary and exchange rate policy:
- Commended the new monetary policy framework for helping contain inflationary pressures.
- Advised the Bank of Mauritius (BOM) to stand ready to tighten the monetary policy stance should inflationary pressures reemerge.
- Recommended resuming uncapped auctions to better align the interbank rate with the key policy rate and enhancing monetary policy transmission, including via communication strategy improvements.
- Suggested amendments to the BOM Act to help preserve BOM independence and exploring options to gradually phase out the central bank’s ownership of the Mauritius Investment Corporation.
- Supported continued exchange rate flexibility and opportunistic foreign exchange purchases, consistent with the monetary policy framework, to bolster foreign reserve buffers.
- Stressed the need for continued close monitoring of financial sector risks.
- Structural reforms and long-term growth:
- Urged embracing structural transformation to strengthen the external position, secure resilient and sustainable long‑term growth, and achieve high‑income status.
- Key reform areas: boosting female labor force participation, addressing skill mismatches, fostering digitalization, strengthening governance and anti‑corruption frameworks, promoting external competitiveness and diversification, and enhancing climate‑resilient infrastructure investment.
- Commended strengthening of the AML/CFT framework and encouraged sustaining this progress.
Institutional follow-up
- It is expected that the next Article IV consultation with Mauritius will be held on the standard 12‑month cycle.
Press Release No. PR24/168 — IMF Communications Department, May 16, 2024.
