Business confidence takes a leap in Mauritius
The latest issue of the MCCI Business Confidence Indicator shows a strong increase in business confidence for the first quarter of the year. It has risen by 6.2 points to establish itself now at 91.6 points (a 7.3% leap).
This improvement is the highest since June 2012. It follows declines during the two preceding quarters. The two components of the barometer, namely the assessment of the economic outlook and the evaluation on the current economic situation, are both positive, hinting that the Mauritian economy has kicked in the upturn phase of the economic cycle. They herald a better economic performance for the first quarter of 2013 compared to the same period in 2012.
More importantly, this increase is a reflection of the economy as a whole since the Business Confidence Indicator, after more than a year since such a result was registered, shows increased confidence in all sectors of activity, namely trade, manufacturing and services.
An analysis of the data collected has identified the possibility of expansion and diversification on new markets, an accommodative fiscal policy, a competitive exchange rate policy and government support among the factors that have contributed to this improvement in the business climate during this first quarter.
However, there remain some areas of concern such as competition, uncertainty in the international economic environment, road traffic issues affecting competitiveness, staff turnover and a lack of human resources with adequate qualifications, ease of access to capital, logistics and connectivity problems.
The study also revealed that employment is likely to increase in the shorter term, while a rebalancing of the general level of prices could be expected. Investment for the next twelve months is expected to rise, as entrepreneurs seek to expand and diversify, with a vast majority prioritising investment in machinery and equipment.