The World Bank's Macro Poverty Outlook (MPO) analyzes macroeconomic and poverty developments in 147 developing countries. The report is released twice annually for the Spring and Annual Meetings of the World Bank and the International Monetary Fund. The MPO consists of individual country notes that provide an overview of recent developments, forecasts of major macroeconomic variables and poverty during 2024-2026, and a discussion of critical challenges for economic growth, macroeconomic stability, and poverty reduction moving forward.
The WB MPO for Mauritius was released this month for the ongoing IMF/WB Spring meetings. The growth rate for Mauritius in 2026 is estimated at 2.5%, compared with the Statistics Mtius forecast of 3.0%, and the IMF forecast of 3.1%. Inflation in 2026 is forecast at 3.9%. The WB fiscal forecasts are on a calendar year basis, and 𝐭𝐡𝐞 𝐟𝐢𝐬𝐜𝐚𝐥 𝐝𝐞𝐟𝐢𝐜𝐢𝐭 𝐢𝐧 𝟐𝟎𝟐𝟔 𝐢𝐬 𝐞𝐬𝐭𝐢𝐦𝐚𝐭𝐞𝐝 𝐚𝐭 𝟕% 𝐨𝐟 𝐆𝐃𝐏. 𝐏𝐮𝐛𝐥𝐢𝐜 𝐒𝐞𝐜𝐭𝐨𝐫 𝐃𝐞𝐛𝐭 𝐢𝐧𝐜𝐫𝐞𝐚𝐬𝐞𝐬 𝐬𝐥𝐢𝐠𝐡𝐭𝐥𝐲 𝐭𝐨 𝐨𝐯𝐞𝐫 𝟗𝟎% 𝐨𝐟 𝐆𝐃𝐏 𝐛𝐲 𝐞𝐧𝐝 𝟐𝟎𝟐𝟔.
The concluding para of the MPO makes a direct reference to the risk of a sovereign credit downgrade:-
Risks are heavily tilted to the downside. If prolonged, the conflict in the Middle East could weaken external demand and dampen investor sentiment, while the accompanying rise in oil prices risks further raising air fares and production costs, eroding export competitiveness, adding to inflationary pressures, and offsetting earlier gains in poverty reduction. Additionally, lower than expected tax revenue and delays in pension reforms or in the ratification of the Chagos Islands agreement could slow fiscal consolidation. 𝑻𝒐𝒈𝒆𝒕𝒉𝒆𝒓, 𝒕𝒉𝒆𝒔𝒆 𝒓𝒊𝒔𝒌𝒔, 𝒄𝒐𝒎𝒑𝒐𝒖𝒏𝒅𝒆𝒅 𝒃𝒚 𝒆𝒍𝒆𝒗𝒂𝒕𝒆𝒅 𝒑𝒖𝒃𝒍𝒊𝒄 𝒅𝒆𝒃𝒕, 𝒄𝒐𝒖𝒍𝒅 𝒓𝒆𝒔𝒖𝒍𝒕 𝒊𝒏 𝒂 𝒔𝒐𝒗𝒆𝒓𝒆𝒊𝒈𝒏 𝒄𝒓𝒆𝒅𝒊𝒕 𝒅𝒐𝒘𝒏𝒈𝒓𝒂𝒅𝒆, 𝒕𝒉𝒖𝒔 𝒂𝒇𝒇𝒆𝒄𝒕𝒊𝒏𝒈 𝒊𝒏𝒗𝒆𝒔𝒕𝒐𝒓 𝒄𝒐𝒏𝒇𝒊𝒅𝒆𝒏𝒄𝒆.
