Exports of goods are expected to decline by 1.7% this year according to the latest projections by Statistics Mauritius. The slowdown in this sector is not unique to Mauritius.

Kendall Tang, Director of RT Knits.
Kendall Tang, Director
from RT Knits.

Exports of goods and services recorded an increase of Rs 30.8 billion in 2023 to reach Rs 347 billion. While exports of goods exceeded Rs 100 billion in 2022 and 2023, the Minister of Finance, during his major speech on the 2024-25 Budget, stressed the ambition to increase exports of goods to Rs 150 billion per year. According to figures published by Statistics Mauritius, total exports increased by 2.8% in April 2024 compared to the previous month and by around 14.4% compared to the corresponding period of 2023. Statistics Mauritius anticipates that total exports forecast for 2024 will amount to around Rs 104 billion, the same level as in 2023. For its part, Maurice Stratégie is counting on an increase in exports of goods in a proportion lower than the initial forecasts.

In its latest National Accounts release, the Statistics Office projects that exports of goods and services would increase by 3.3% to Rs 359.3 billion in 2024, compared to Rs 347.8 billion last year. In real terms, this represents an increase of 0.5% after growing by 0.6% in 2023. Exports of goods would decline by 1.7%, compared to a decline of 12% in 2023, while exports of services will climb by 1.4% after growing by 6.9% in 2023. Lilowtee Rajmun-Jooseery, Director of the Mauritius Export Association (MEXA), is not surprised by the slowdown that is currently taking place in the Mauritian export sector. She points out that the export sector has seen a strong recovery after the Covid-19 pandemic, with growth rates exceeding 10%. “It is normal that we are seeing a decline this year, due to the slowdown in the international market. There is also overstocking among customers,” she said.

The recovery from the pandemic did not last due to certain measures taken by the government which impacted the costs of operations”

Lilowtee Rajmun-Jooseery, Director of the Mauritius Export Association.

In addition to slowing global demand, Kendall Tang, Director of RT Knits, concedes that coupled with inflation and loss of purchasing power, consumers in developed countries are buying with much more caution. He makes it clear that the drop in demand leads to more competition between suppliers. “It is the most competitive offer that will stand out. There is a competitiveness problem in Mauritius which is influenced by the cost of operations,” he adds. Faced with this increasingly fierce competition, Lilowtee Rajmun-Jooseery fears that 2024 will be a difficult year in all sub-sectors of the export family.

The galley of SMEs

Thus, the recovery after the pandemic did not last due to certain measures adopted by the government that impacted the cost of operations. Manoj Juddoo, Managing Director of Chemise Bellvill, deplores the lack of visibility regarding upcoming orders. “We do not know the new measures that will be, by order. “We do not know the new measures that will be, for example, introduced next January. We have positioned ourselves in niche markets. However, the increase in the cost of production does not allow us to exceed the threshold requested by customers,” he explains. Consequently, this risks causing the loss of customers for some SMEs. This would be a new blow, while Chemise Bellvill's exports have fallen. This is because the SME was forced to pass on the increase in operating costs to its sales prices. “It is up to the customer to accept or not this increase. The financial support granted by the Mauritius Revenue Authority (MRA) is very erratic,” he continues.

Some operators are choosing to set up elsewhere. To prevent others from following suit, Manoj Juddoo suggests measures to keep costs down. “How can we plan our orders when there have been three wage increases in one year? We cannot review our prices once the purchase order is issued,” he points out.

Does the Budget 2024-25 address the challenges of companies engaged in exports? To this question, Lilowtee Rajmun-Jooseery explains that we must “welcome the budgetary measures for the sector. These have been worked on with MEXA and they tend to sustainable growth for the export sector”.

Budgetary measures targeting the export sector

Introduction of Export Manufacturing Regulations under the Economic Development Board Act.
Goals :

  • Define an export manufacturing company as having a minimum of 30% of export turnover.
  • Create an export promotion fund with an initial capital of Rs 50 million.
  • Create an Export Development Council, composed of representatives from the public and private sectors to develop export strategies, including the identification of products and markets.
  • Extension of the Africa Warehousing Scheme programme until 2027 with extension to Kenya.
  • Freight Rebate, Trade Promotion and Marketing, Export Credit Guarantee Schemes are extended by one year to continue facilitating exports.
  • New exporters with a turnover of less than Rs 20 million will benefit from an increased reimbursement of 40% for a period of one year under the Freight Rebate Scheme.
  • The Trade Promotion and Marketing Scheme will now include New Zealand.
  • Extension of DBM Wage Support Scheme over a period of 7 years until 2031.

Kendall Tang's Industry Challenges

  • Production and productivity. You have to make sure you are equivalent or more competitive than your competitors.
  • We must be in line with the expectations of the general public, the customer and the end consumer. The world is open and information circulates quickly, particularly concerning environmental awareness and workers' rights, among others. There is pressure for producers to be irreproachable.
  • The problem of the workforce is related to the expectation. The aspiration of a young person today is different from that of the 1990s. The company must constantly adapt its business model in terms of job offers to be filled. This includes how to create the work environment, the structure of the company and adaptation to this modern era.
  • There needs to be a balance between foreign labour and local resources. Mauritius has already reached a level of development where young people will not want to work as operators. These jobs are reserved for expatriates. On the other hand, they need to be supervised and invested in sustainable development projects, for example. We need talented young Mauritians who have knowledge in these areas.

Questions for…

Sunil Boodhoo, Director of International Trade at the Ministry of External Affairs: “Exploit new opportunities as traditional markets become more difficult”

What explains the slowdown in the export sector and the low growth rate expected for this year?

There are several reasons for this. The situation is cyclical. The global economy is not moving at full speed. Our major export markets are also facing challenges. It should be noted that Mauritian exports have increased after the pandemic. Governments in various countries have provided financial support to their populations. The pandemic had hit the travel industry hard. Consumers had turned to buying exchange goods. However, life has since resumed. There is a gloomy situation in the world. We know the problems in the United Kingdom or France, for example. Global demand has declined.

“Aggregate demand has declined”

Which markets are doing well and where should Mauritius' efforts be stepped up?

The European markets are facing challenges. I am talking about some traditional markets here. Mauritius is performing better in the African market. That said, the situation should stabilise, but it will take some time.

Will the measures announced in the 2024-25 Budget help boost the country's exports?

The establishment of an Export Development Council is a step in this direction. We need to be able to make targeted promotions, especially on new markets. The Indian economy is progressing in the opposite direction to that of China. There are new markets that need to be exploited. This process is underway, but will require a little more time, because we will need to export new products there. Developing relationships with importers in these countries requires time. We also need to put the necessary conditions in place. For example, exporting agricultural products requires compliance with health measures. For example, Mauritius hosted Chinese experts who carried out pest risk assessments. China is a major market for the export of lychees and pineapples. We must first complete certain procedures. We must therefore exploit new opportunities while traditional markets are becoming increasingly difficult.

In numbers

Exports down 1.4%
Total export earnings in 2023 amounted to Rs 104 billion, a decrease of 1.4% compared to the figure of Rs 105 billion recorded in 2022. This decrease can be attributed to the reductions in “Manufactured goods classified mainly by material” by 13% and “Miscellaneous manufactured articles” by 9.4%. National exports decreased from Rs 61 billion in 2022 to Rs 60 billion in 2023.
First quarter 2024

  • Total export product: Rs 23 billion (+9.6% compared to Rs 25 billion in the previous quarter).
  • “Manufactured products classified mainly by material”: (-22.3%)
  • “Miscellaneous manufactured articles”: (-10.1%)
  • “On-board provisions and holds”: (-7.4%)
  • “Food and live animals”: ​​(-4.1%)
  • “Chemicals and related products: (+4.1%)

Compared to the first quarter of 2023

  • Total exports for the first quarter of 2024: down 8.4%
  • “Manufactured products classified mainly by material”: (-27.8%)
  • “Miscellaneous manufactured articles”: (-14.7%)
  • “Food and live animals”: ​​(-4.2%)
  • “On-board provisions and holds”: (+22.2%)
  • “Chemicals and related products: (+13.4%)

Maurice Strategy's forecasts for 2024/25

  • Nominal growth rate of gross domestic product (GDP): 13.4%
  • Real growth rate: 7%

Some contributors to the growth rate

  • Consumption: (+2.30 pp)
  • Tourism: (+1.90 pp)
  • Private investment: (+1.60 pp)
  • Export of services: (+1.50 pp)
  • Public investment: (+0.60 pp)
  • Exports of goods: (+0.50 pp)

Exports of goods

Contribution to GDP growth: 0.5 percentage points

Exports of services (excluding tourism)

  • 2024-25: +1.5 percentage points to GDP growth

Growth 2025: 7%


Leave a reply below

Your email address will not be published. Required fields are marked *


Contact Business

Captcha Code