[Blog] Quo Vadis Republic of Mauritius?

On 12th March 2023, The Republic of Mauritius celebrates 55 years of post-independence history. It would be an understatement to just say that there has been a lot of water under the bridge on our journey to self-determination!

Indeed, we have made massive progress since we lowered the Union Jack and unfurled our own flag. It was and remains a moment of great pride whenever I see our flag in any international event, I participate in.

We are a small vulnerable island, deprived of natural resources and at the time of independence, we were flanked with a monoculture economy, high unemployment, low education and low income were amongst the major challenges. 

We had been relegated to being a basket case. Even Nobel prize winners concluded that because of our isolation from the then major capitals; climate challenges etc. we were doomed at a time when our per capita income hovered around 200USD.

We were more a recipe for disaster than that a success story. Still over time, with leadership and vision, we proved to the world that another outcome was feasible, but more importantly, that profound transformation was possible, and we succeeded within one single generation.

We became the shining star especially South of the Sahara and our experience brings useful insights into the dynamics and pitfalls of an economic transformation journey. Nonetheless, this transformation has been conducted in such a manner that the economic landscape, society and institutions were modernised simultaneously, albeit at various speeds, taking into consideration the political, human, institutional and economic realities and constraints of the time. The approach was largely inclusive because the major asset then and now remains our diverse, talented population.

Our story had been based on the following foundational stones: political leadership, strong institutions, ethnic diversity, a class of versatile indigenous entrepreneurs and a well-structured private sector engaged in dialogues on policy matters.

Coupled with this, the balance has been between economic and social objectives, with a strong focus on human capital, through free education since 1976, free health care, and a minimum basic social safety net for the most vulnerable.

Still, the strength of our institutions was a key guarantee for investment, entrepreneurship and innovation. While acknowledging that significant progress has been achieved in the last 50+ years, the global dynamics call for more and more reforms if our country wants to avoid the middle-income trap and join the club of high-income countries within the realm of a changing climate.

There are already indications of worrying signals: the average growth rate has been stabilizing at less than 5%, necessary to enable incremental changes, but insufficient to steam up the engine to the next level. Beyond the redesigning and re-engineering of the economic landscape, some implementable reforms will have to be addressed.

The main weaknesses are found in our education system. While we have a 99% enrolment rate at the primary level, what comes next is disappointing. Let’s take the hypothetical 100 children entering our primary school, 80 will manage to pass their primary school exam to enter secondary school; only 60 will manage to succeed after the first 3 years, 40 will pass the Grade 5 (O-level) exams and with only 20-30 will reach the end of the secondary school cycle. This is in total contradiction to the requirements of a high-income country; one that ambitions to attract High Tech investment.

The curriculum needs to move away from being too academic and with few openings for technical and vocational training. Also, labour market reforms need to ensure flexibility. A diversified economic base only makes sense if it is possible for people to move across sectors. Currently, the stiffness of labour market and employment schemes that go with it, makes it difficult for people to move around. The basic principle must remain the protection of the people as opposed to jobs.

Finally, Mauritius must step up efforts to plug into regional and global value chains. We must continue to build on the regional market and must upgrade our participation in the global value chains, by capturing activities with higher value addition.

Our regional market penetration remains weak. In the last decade, it has been estimated that Mauritius’s export to the SADC region amounted to only 1.3% while its imports from the SADC region amounted to 2.5%. Similarly, we still have too big a bias towards our traditional markets to export low-value-added products.

Competition over concepts rather than over processes will be increasingly necessary to have a meaningful role. To achieve this, increased investment in quality education, innovation, research and development and technology, the appropriate ecosystem for start-ups, is crucial.

We are at a crossroads in our economic transformation. The latter can remain a continuous process as we have had a good track record so far. The challenge for our country now lies in combining sustained domestic reforms with efforts required to keep up with international trends to become a global player. This demands that we align all our talents, competence and resources.

Next door to us, a giant is waking up – The African continent and the AfCFTA present a huge opportunity, for, inter alia, our manufacturing sector, provided we engage with her, like in any relationship, seriously, and not just pay lip service.

We have to keep reminding ourselves that the world we embraced in 1968, is now fast mutating. We were born in a bipolar world and now living in an increasingly multipolar world. Our foreign policy must remain agile as it is going to be a rocky road especially as we will have to count on the presence of new emerging African middle-income countries that are increasingly catching up with their economic trajectory.

We will only succeed if we manage to navigate through competition, build trust and strengthen our institutions, acknowledge our diversity as a strength, ensure meritocracy and by turning challenges into potential opportunities as ONE people and ONE Nation, in Peace, Justice and Liberty.

Ameenah Gurib-Fakim,

Former President of the Republic