Mauritius GDP growth forecast at 3.9% & 4.3% for 2015 & 2016: Barclays Bank
Jeff Gable spoke about the global economy, and noted that for 2015, a stalled recovery is forecast where the overall EU bloc shall fare slightly better. (Image: Wazna Gunga)
GDP growth estimates for Mauritius are expected at 3.9% and 4.3% for 2015 and 2016 respectively, according to Barclays Bank forecasts, revealed at a business meeting organised today 09 April 2015, under its Africa Roadshow initiative.
The presentation also aimed to decode the economic and social trends prevailing in the wider continent, as well as the opportunities for business in Africa.
Present at the event were the Chief Executive of Barclays Africa Regional Management, Mizinga Melu, the managing director of Barclays, Mauritius, Ravin Dajee and Managing Principal, Head of Non-Equity Research, Corporate and Investment Banking of Barclays Africa, Jeff Gable, who delivered a presentation during the “Africa Roadshow.”
Mizinga Melu emphasised that Mauritius is the most competitive economy in Africa given the presence of economic freedom, good governance, viable investment destination, and is ranked among the top countries on the ease of doing business.
The banking sector is a key priority for the island economy and the growth of the SME sector requires that various customised product platforms be provided.
Barclays services in Mauritius are important in various segments and the bank is investing a lot in technology to provide quality retail and corporate banking services, with the latest being remote account opening.
Jeff Gable spoke about the global economy, and noted that for 2015, a stalled recovery is forecast where the overall EU bloc shall fare slightly better. United States is expected to grow by 2.7%, the Euro Zone will expand by 1.5%, Japan will develop by 1.0% while Eastern Europe is expected to contract by 0.6%. He also highlighted that for most countries, the forecast is slightly higher than 2014.
Global commodity trends were also touched upon in the business meeting, depicting figures showing a growth of 5.7 times in gold, 5.2 times growth in copper and 4.5 times for oil.
For oil, the detailed price trend was provided, with the current price being USD 56 a barrel, and it was demonstrated how oil prices are being impacted by the subtle shifts of demand and supply. Jeff Gable also noted that Africa’s exposure to the commodity cycle goes well beyond oil.
The presentation also touched upon Africa increased exposure to the global financing cycle with the continent’s reliance on market funding by larger costs. In terms of rating, upgraded countries in the African continent were Rwanda, Seychelles and Uganda while Angola and Ghana were among downgraded countries.
The resource inflow in term of projects indicates that the financial, telecommunication and rubber segments record the highest percentage of project numbers with 18%, 16% and 14% each respectively while in terms of percentage value of FDI, mining, and oil & gas, attract the highest percentage of FDI inflows at 14% and 32% respectively.
It is also to be noted that even though mining, and oil & gas, capture the highest percentage value of FDI, in terms of percentage of projects, these segment feature low down in the list, with 7% and 6% each, indicating that these segments require huge investments. In terms of jobs, the real estate segment captures 19% of jobs, followed by 12% for rubber.
Africa’s attractiveness was also highlighted in the event and supporting figures from the presentation show that Africa rank (being country attractiveness for direct investment) continues to be upgraded. In 2011, Africa ranked eighth and in 2014, the continent moved up the ladder to 2nd place while Asia has sustained its place at the first place through 2011 to 2014.
The speaker also provided some thoughts on the Mauritian economy and highlighted that the Bank of Mauritius will find its place becoming increasingly important in a growing financial services environment.
He also noted that forecasts for the Mauritian rupee have been provided by the economists in the Barclays research team with USD/MUR to be 43 and EUR/MUR to be 40. The rupee experience is not unusual and the speaker noted that greater reserves can help in the event of a more serious threat to the forex market. The general views of his research team are that after one further cycle of depreciation pressure, global adjustments will lead to a stronger USD. One dollar will be worth more than one euro in the coming days of 2015, he added.
The presentation ended with Barclays’ macro forecast for Mauritius showing GDP growth estimates for 2015 and 2016 at 3.9% and 4.3% respectively, while government debt shall stand at 52.2 % of the GDP in 2015 and come down to 52.0% of the GDP in 2016.
- By Wazna Gunga