Titbits : Cost of credit, Public debt and PBB

Cost of credit

     There seems to be a sudden awakening on the question of the cost of credit, may be because of the comments in the WB report – Investment Climate Assessment Mauritius 2009 -- that “the cost of borrowing in Mauritius, as measured by average interest rates, is high by comparative country standards.

Fragile Times – The Monetary Policy Stance

The Monetary Policy Committee (MPC) of the Bank of Mauritius unanimously decided to leave the key Repo Rate unchanged at 5.75 per cent per annum at its meeting of the 22nd June. Caught between rising inflationary expectations and excess liquidity accompanied by the prospect of slackening growth, the MPC thought it preferable to stay on the sideline for the moment quite unsure about inflation and growth outlook.

A More Proactive Competitive Strategy for SMEs

According to the Central Statistical Office (CSO), which conducts a census of small establishments employing less than 10 persons every five years, the contribution of the small units to value added is only 20% in 2007 compared to 18% in 2002. The structure of the Small and Medium Enterprises’ contribution to the economy has remained more or less the same.

Dismantling & Redesigning the TINA Policies

     Whatever little debate there was during the recent election, it centred mostly on the TINA (There Is No Alternative) policies; there was near unanimity against the neo-liberal and purely theoretical policies – the blind adherence to the Washington Consensus -- that were tried on the populace. The entire Mauritian political spectrum, including our Party Malin and popular sentiment unsettled by TINA policies (with the exception of the TINA stooges in the press that have over the last five years tried to build the TINAs and their friends as the most brilliant and super competent economists that ever walked on Mauritian soil) had expressed their discontent in various ways.

Competitiveness not an option anymore !!!

A proper assessment of our external competitiveness with respect to our major trading partners by examining a variety of indicators will shed some light over some of the present policy implications of dealing with an appreciating rupee. What is meant by the competitiveness of an economy?The concepts of competitiveness are the short-run versus long-run view of competitiveness and price versus non-price measures of competitiveness. The commonly used measures of competitiveness are multilateral or nominal effective exchange rate (NEER), real exchange rates and real effective exchange rate (REER). In the long run, competitiveness reflects the ability of an economy to improve living standards.

The Propertied Oligarchy: Their Veto Power

As no man is a prophet in his own land, the tapping of external sources may be more useful in driving our point that our local politics continue to be influenced by the moves of the old propertied oligarchy. (preferable to railing against the double standards of a partisan media.) The recent report of the BTI 2010 — Mauritius Country Report. Gütersloh: Bertelsmann Stiftung, 2009 shares our views that “ .... democratic institutions have not succeeded in breaking up the veto power of the old propertied white oligarchy or in bringing it under democratic control. Democracy, a cornerstone of Mauritian national identity, ends on the sugar cane plantation, at the bank and at the factory gate. Under the surface of ethnic and cultural pluralism, the economic dominance of the Franco-Mauritian upper class is still effective. "

New Issues and challenges

Le gratin of the public sector -always free for free lectures especially if there are from foreign experts - were all there in the front seats avidly imbibing those glimpses of insights on the need to reassess our strategies towards Asia which is gradually imposing itself as the “true engine of global growth”. The lecture of Professor Dan Quah of LSE did touch a chord.