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TRADE POLICY REVIEWS: FIRST PRESS RELEASE, SECRETARIAT AND GOVERNMENT SUMMARIES

PRESS RELEASE
PRESS/TPRB/176
2 November 2001
Mauritius: November 2001

The WTO Secretariat report, along with the policy statement by the Government of Mauritius, will serve as a basis for the second trade policy review of Mauritius by the Trade Policy Review Body of the WTO on 2 and 5 November 2001.

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See also:

Second press release
Chairperson’s concluding remarks


Sound macroeconomic policies and diversification have contributed to Mauritius' strong economic perfomance   Back to top

Sound macroeconomic policies have contributed to sustained strong economic performance in Mauritius for two decades with an average growth of nearly 6% a year. Concurrently, Mauritius has successfully diversified its economy away from sugar. Textiles and clothing, tourism, financial services, and sugar are now the four pillars of the economy, according to a WTO report on the trade policies and practices of Mauritius.

The report indicates that the share of agriculture in real GDP has declined, from around 12% in 1990 to some 6% now. The services sector, dominated by tourism and financial services, is the most important in the economy, accounting for around 74% of real GDP. Services exports are more than one third of total foreign exchange earnings, with tourism contributing the largest and increasing share. Manufacturing is the source for some 75% of merchandise exports; it contributes around one fifth of real GDP, with textiles and clothing accounting for more than 40% of manufacturing output.

The report notes that nevertheless, Mauritius faces challenges. Its economy has elements of duality: companies producing for the domestic market are fairly highly protected, while export enterprises are granted incentives under various schemes, including the Export Processing Zone Scheme. This has led to tensions in resource allocation between the export and domestic sectors, and highlights the task of transforming the economy away from export- to outward-orientation. Mauritius has also become a “high-cost” producer, as real wages have grown faster than productivity. In addition, Mauritius faces a changing international environment, including the narrowing of preferences for some of its exports, and the consequent increase in competition. Added to these factors is a scarcity of arable land and of skilled labor. In response to these challenges, Mauritius has been promoting (mainly by means of incentives) domestic production of capital-intensive higher-value-added goods and the geographical diversification of exports. There has also been a certain delocalization of low-value-added labor-intensive activities to neighboring countries.

Since its last Trade Policy Review in 1995, Mauritius has continued to implement trade-related reform, although border protection remains relatively high in some areas. Differing customs duties still apply on the bases of import source. A reduction in maximum tariff rates, and an increase in the number of duty-free lines, have contributed to lowering the simple average MFN tariff to some 20%; this is fairly high, particularly given that over 50% of lines bear a zero rate. Nearly all rates are ad valorem; these rates range to 80%, with high dispersion. Specific duties are collected on two tariff lines, with the highest ad valorem equivalent being around 360%. Since 1995, the number of tariff bands has remained unchanged at eleven, including the zero rate and the ad valorem equivalents of the two specific duties. Using the WTO definition, the simple average tariff is 20.5% on agricultural imports, and 19.8% on imports of non-agricultural products.

Mauritius has bound nearly 15% of all its tariff lines. It bound tariffs at a ceiling rate of 65% on some 1.6% of its total tariff lines for non-agricultural products; tariffs on all agricultural products (WTO definition) are bound at ceiling rates ranging from 37% to 122%. Other duties and charges on all these products are bound at zero or 17%. An increase in the coverage of bindings and the narrowing of the gap between bound and applied rates would enhance predictability of Mauritius' tariff regime.

The report also indicates that the liberalization reforms have fallen short of further dismantling non-tariff measures maintained on various grounds. The number of products subject to import ban, or import control by means of permit, has increased. Import quotas still apply to table-potatoes and salt. Several parastatal bodies, including the State Trading Corporation and the Agricultural Marketing Board, purchase, import, and store “strategic” products (including flour, ration rice, petroleum products, cement, table potatoes, onions, and garlic). Price controls, consisting of a fixed maximum price system (on imports and locally produced goods) and a maximum percentage mark-up system (only on imports), are also maintained on some of the strategic products; the controls are to be abolished gradually after the enactment of competition legislation, a draft of which is being vetted by the Office of the Attorney General. A permit is required for the exportation of products of “strategic importance” and of goods eligible for preferential-quota treatment in importing countries. Mauritius applies no duties, taxes or charges to its exports.

Incentives (including duty and tax concessions) are available under various schemes to local producers, mainly manufacturers, and to exporters, with a view to encouraging investment and improving the international competitiveness of Mauritian products. In addition, partial refunds of air freight costs are granted to exporters of selected agricultural products. The incentives, together with elimination/reduction of tariffs on inputs, increase effective protection for local processing industries.

Mauritius' participation in the multilateral trading system and in various regional agreements reflects its interests as a small, export-oriented economy with advantages in a few products, sugar, textiles and clothing in particular. As part of its economic success is due to preferential market access granted by major trading partners, Mauritius is taking steps to adjust to changes in this international environment.

The adjustment needs to emphasize the streamlining and rationalization of existing incentives so as to lessen the aspects of duality and improve resource allocation. The resultant reduction/elimination of duty and tax concessions could contribute to reducing the public deficit and to facilitating further tariff reforms, which are currently hampered by fiscal concerns as customs duties account for about 50% of tax revenue.

Elimination of non-tariff barriers and of differing customs duties (by source) would enhance the transparency of Mauritius' trade regime. Such a regime might also play a greater role in attracting investment as more tariffs are bound, the gap between applied and bound rates narrows, and GATS scheduling increases, including perhaps in the context of introducing greater competition in service subsectors such as telecommunications. Overall, such adjustments could contribute to an improved exploitation of Mauritius' comparative advantages, and facilitate the transformation from an export- to an outward-oriented economy.

  
Note to Editors

Trade Policy Reviews are an exercise, mandated in the WTO agreements, in which member countries’ trade and related policies are examined and evaluated at regular intervals. Significant developments which may have an impact on the global trading system are also monitored. For each review, two documents are prepared: a policy statement by the government of the member under review, and a detailed report written independently by the WTO Secretariat. These two documents are then discussed by the WTO’s full membership in the Trade Policy Review Body (TPRB). These documents and the proceedings of the TPRB’s meetings are published shortly afterwards. Since 1995, when the WTO came into force, services and trade-related aspects of intellectual property rights have also been covered.

For this review, the WTO’s Secretariat report, together with a policy statement prepared by the Government of Mauritius, will be discussed by the Trade Policy Review Body on 2 and 5 November 2001. The Secretariat report covers the development of all aspects of Mauritius trade policies since the previous review, including domestic laws and regulations, the institutional framework, trade policies by measure, and developments in selected sectors.

Attached to this press release is the Overview to the Secretariat report and parts of the government policy statement. The Secretariat report and the government's policy statement are available for the press in the newsroom of the WTO internet site (www.wto.org). These two documents and the minutes of the TPRB’s discussion and the Chairman’s summing up, will be published in hardback in due course and will be available from the Secretariat, Centre William Rappard, 154 rue de Lausanne, 1211 Geneva 21.

Since December 1989, the following reports have been completed: Argentina (1992 and 1999), Australia (1989, 1994 and 1998), Austria (1992), Bahrain (2000) Bangladesh (1992 and 2000), Benin (1997), Bolivia (1993 and 1999), Botswana (1998), Brazil (1992, 1996 and 2000), Brunei Darussalam (2001), Burkina Faso (1998), Cameroon (1995 and 2001), Canada (1990, 1992, 1994, 1996, 1998 and 2000), Chile (1991 and 1997), Colombia (1990 and 1996), Costa Rica (1995 and 2001), Côte d’Ivoire (1995), Cyprus (1997), the Czech Republic (1996 and 2001), the Dominican Republic (1996), Egypt (1992 and 1999), El Salvador (1996), the European Communities (1991, 1993, 1995, 1997 and 2000), Fiji (1997), Finland (1992), Gabon (2001), Ghana (1992 and 2001), Guinea (1999), Hong Kong (1990, 1994 and 1998), Hungary (1991 and 1998), Iceland (1994 and 2000), India (1993 and 1998), Indonesia (1991, 1994 and 1998), Israel (1994 and 1999), Jamaica (1998), Japan (1990, 1992, 1995,1998 and 2000), Kenya (1993 and 2000), Korea, Rep. of (1992, 1996 and 2000), Lesotho (1998), Macao (1994 and 2001), Madagascar (2001), Malaysia (1993 and 1997), Mali (1998), Mauritius (1995 and 2001), Mexico (1993 and 1997), Morocco (1989 and 1996), Mozambique (2001), New Zealand (1990 and 1996), Namibia (1998), Nicaragua (1999), Nigeria (1991 and 1998), Norway (1991, 1996 and 2000), OECS (2001), Pakistan (1995), Papua New Guinea (1999), Paraguay (1997), Peru (1994 and 2000), the Philippines (1993 and 1999), Poland (1993 and 2000), Romania (1992 and 1999), Senegal (1994), Singapore (1992, 1996 and 2000), Slovak Republic (1995), the Solomon Islands (1998), South Africa (1993 and 1998), Sri Lanka (1995), Swaziland (1998), Sweden (1990 and 1994), Switzerland (1991, 1996 and 2000 (jointly with Liechtenstein)), Tanzania (2000), Thailand (1991, 1995 and 1999), Togo (1999), Trinidad and Tobago (1998), Tunisia (1994), Turkey (1994 and 1998), the United States (1989, 1992, 1994, 1996, 1999 and 2001), Uganda (1995), Uruguay (1992 and 1998), Venezuela (1996), Zambia (1996) and Zimbabwe (1994).

  
  
The Secretariat’s report: summary  Back to top

TRADE POLICY REVIEW BODY: MAURITIUS
Report by the Secretariat — Summary Observations

Sound macroeconomic policies have contributed to sustained strong economic performance in Mauritius for two decades; on average the economy has grown at nearly 6% a year. Concurrently, Mauritius has successfully diversified its economy away from sugar. Textiles and clothing, tourism, financial services, and sugar are now the four pillars of the economy. In consequence, the share of agriculture in real GDP has declined, from around 12% in 1990 to some 6% now. The services sector, dominated by tourism and financial services, is the most important in the economy, accounting for around 74% of real GDP. Services exports are more than one third of total foreign exchange earnings, with tourism contributing the largest and increasing share. Manufacturing is the source for some 75% of merchandise exports; it contributes around one fifth of real GDP, with textiles and clothing accounting for more than 40% of manufacturing output.

Nevertheless, Mauritius faces challenges. Its economy has elements of duality: companies producing for the domestic market are fairly highly protected, while export enterprises are granted incentives under various schemes, including the Export Processing Zone Scheme. This has led to tensions in resource allocation between the export and domestic sectors, and highlights the task of transforming the economy away from export- to outward-orientation. Mauritius has also become a “high-cost” producer, as real wages have grown faster than productivity. In addition, Mauritius faces a changing international environment, including the narrowing of preferences for some of its exports, and the consequent increase in competition. Added to these factors is a scarcity of arable land and of skilled labor. In response to these challenges, Mauritius has been promoting (mainly by means of incentives) domestic production of capital-intensive higher-value-added goods and the geographical diversification of exports. There has also been a certain delocalization of low-value-added labor-intensive activities to neighboring countries.

The high ratio of merchandise trade to GDP (around 90% on average since 1995) indicates the importance of external trade to Mauritius. Normally it has run trade deficits, which have been offset from time-to-time by traditional surpluses on the services account. The bulk of domestic production is exported, clothing accounting for some 60% of foreign exchange earnings from merchandise exports followed by sugar (22%). Mauritius' main imports include machinery and transport equipment, textiles, and food.

The European Union (EU) is Mauritius' major trading partner: it is the market for the bulk of Mauritius' sugar output and for a large share of textiles and clothing exports; it supplies around one third of Mauritius' imports. The major single destinations of Mauritian exports include the United Kingdom, France, and the United States. Delocalization of certain manufacturing activities (combined with their vertical integration) to neighboring countries has contributed to the promotion of trade with countries such as Madagascar, to which Mauritius exports semi-finished products and yarns. The sources of imports are more diversified, with France being the only country supplying more than 9% of the total value of Mauritius' merchandise imports.

  
Institutional Framework

The Republic of Mauritius is a multi-party parliamentary democracy. The Constitution is the supreme law, followed by the Acts, Regulations, and Rules. International treaties, including the WTO Agreements, must be enacted into domestic law to have standing before national courts. The Ministry of Industry, Commerce and International Trade is responsible for the formulation, review, and assessment of trade policies. The WTO Standing Co-ordination Committee, chaired by the Minister of Industry, Commerce and International Trade, and comprising representatives from the public and private sectors, deals with the implementation, follow-up, and coordination of trade policy issues falling under the WTO Agreements. Given Mauritius' membership of several groupings, a Regional Co-operation Council, chaired by the Minister responsible for Foreign Affairs, has been established to forge a coherent regional strategy for the country.

The Board of Investment (a one-stop shop) became operational on 15 March 2001 under the authority of the Finance Minister. It aims to promote Mauritius as an international investment, business, and service centre. With the exception of specified activities in the tourism subsector, acquisition of real estate, and activities still under state monopoly, foreigners are free to invest in almost all areas open to Mauritians.

Mauritius is an original Member of the WTO and an ITA signatory. It accords at least MFN treatment to all its trading partners. As a small-island developing country with limited natural resources, Mauritius relies on international trade, and participates actively in the multilateral trading system and in various regional groupings to, inter alia, secure and increase market access for its products. Mauritius believes that non-reciprocal trade preferences are still important to its economy and that they should be enhanced and consolidated. It is also of the view that in considering any future multilateral trade negotiations, priority should be given to implementation issues and to difficulties faced by “small and vulnerable economies”.

Mauritius is a member of, inter alia, the Common Market for Eastern and Southern Africa (COMESA), the Southern African Development Community (SADC), the Indian Ocean Commission (IOC), and the Regional Integration Facilitation Forum (RIFF). Mauritius considers its participation in regional agreements as a step towards building resilience for full integration into the world economy. Nevertheless, membership of various regional agreements with differences in geographical coverage, trade liberalization agenda, provisions on rules of origin, and in goals, is difficult to manage.

  
Trade Policy Instruments

Since its last Trade Policy Review in 1995, Mauritius has continued to implement trade-related reform, although border protection remains relatively high in some areas. A reduction in maximum tariff rates, and an increase in the number of duty-free lines, have contributed to lowering the simple average MFN tariff to some 20%; this is fairly high, particularly given that over 50% of lines bear a zero rate. Nearly all rates are ad valorem; these rates range to 80%, with high dispersion. Specific duties are collected on two tariff lines, with the highest ad valorem equivalent being around 360%. Since 1995, the number of tariff bands has remained unchanged at eleven, including the zero rate and the ad valorem equivalents of the two specific duties. Using the WTO definition, the simple average tariff is 20.5% on agricultural imports, and 19.8% on imports of non-agricultural products.

Mauritius has bound nearly 15% of all its tariff lines. It bound tariffs at a ceiling rate of 65% on some 1.6% of its total tariff lines for non-agricultural products; all agricultural tariff lines (WTO definition) are bound at ceiling rates ranging from 37% to 122%. Other duties and charges on all these products are bound at zero or 17%. An increase in the coverage of bindings and the narrowing of the gap between bound and applied rates would enhance predictability of Mauritius' tariff regime.

Mauritius has taken steps to harmonize differing customs duties based on source (“scheduled”, i.e. Commonwealth and certain major trading partners, and “non-scheduled” territories, i.e. other countries). As from the 2000/01 Budget, the tariff differential has been reduced from 20 to 10 percentage points and applies to only one band: products liable to the MFN tariff rate of 65% carry a lower rate of 55% when they are imported from scheduled territories. Differing excise duties also apply to imports and locally produced goods. In September 1998, a value-added tax of 10% replaced the sales tax; it applies to imports and locally produced goods. Customs duties and taxes account for some 50% of total tax revenue. Since 1 January 2000, Mauritius has applied the provisions of the WTO Customs Valuation Agreement.

The liberalization reforms have fallen short of further dismantling non-tariff measures maintained on various grounds. The number of products subject to import ban, or import control by means of permit, has increased. Import quotas still apply to table-potatoes and salt. Several parastatal bodies, including the State Trading Corporation and the Agricultural Marketing Board, purchase, import, and store "strategic" products (including flour, ration rice, petroleum products, cement, table potatoes, onions, and garlic). Price controls, consisting of a fixed maximum price system (on imports and locally produced goods) and a maximum percentage mark-up system (only on imports), are also maintained on some of the strategic products; the controls are to be abolished gradually after the enactment of competition legislation, a draft of which is being vetted by the Office of the Attorney General. A permit is required for the exportation of products of “strategic importance” and of goods eligible for preferential-quota treatment in importing countries. Mauritius applies no duties, taxes or charges to its exports.

Incentives (including duty and tax concessions) are available under various schemes to local producers, mainly manufacturers, and to exporters, with a view to encouraging investment and improving the international competitiveness of Mauritian products. In addition, partial refunds of air freight costs are granted to exporters of selected agricultural products. The incentives, together with elimination/reduction of tariffs on inputs, increase effective protection for local processing industries.

Mauritius does not have legislation on contingency trade remedies; it has not taken any anti-dumping, countervailing or safeguard actions. The legislation on government procurement has been revised several times in recent years; a High Powered Committee is currently reviewing the legislation, to ensure conformity with international norms and practices. Twelve compulsory standards (up from seven in 1995) apply both to imports and locally produced goods.

Mauritius has revised its Copyright Act. Further, with a view to meeting its obligations under the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), Mauritius is also finalizing new legislation on patents and trade marks, and is drafting legislation on industrial designs, geographical indications, and layout design of integrated circuits. Counterfeiting mainly affects copyrights and trade marks.

  
Sectoral Trade Policies

Agriculture, though declining in share, remains a leading sector of the Mauritian economy. The export-led strategy implemented by Mauritius, and preferential market access provided by developed countries have contributed to the diversification within and away from the sugar industry. The 1988 Sugar Efficiency Act has also played a role by promoting sugar and non-sugar agriculture; the Act provides for a land conversion tax on the use of agricultural land for other purposes, and tax rebates for cultivation of crops other than sugar cane. Other incentives available to producers of agricultural goods include the Agricultural Development Scheme and the Technology Diffusion Scheme. The Freight Rebate Scheme is available to exporters of selected agricultural products.

For food security purposes, import, export, and price controls are maintained, and strategic reserve stocks are required, on certain agricultural products. Public enterprises, including marketing boards, still hold a monopoly over the importation of certain food products, including flour and certain rice. Customs tariffs on agricultural imports range from zero to 80%; the 80% rate applies, inter alia, to cane or beet sugar, chemically pure sucrose (in solid form), and molasses resulting from the extraction or refining of sugar. Imports of some products are prohibited, including sugar and chocolate confectionery; quotas are maintained on imports of potatoes and on exports of chilled fish.

Export Processing Zones companies account for the bulk of manufacturing, which is dominated by textiles and clothing. In response to the changing international environment (e.g. the dismantling of the Multifibre Arrangement and post Lomé ACP-EU Agreements), and to rising production costs, Mauritius' manufacturing policy has focused on market and product diversification (e.g. sectoral integration and shift to higher-value products, delocalization of low-cost activities to neighbouring countries), and on improvement of competitiveness (through, inter alia, various incentive schemes, and elimination or reduction of customs tariffs on inputs and equipment). Certain manufactured products are subject to import and export controls, to the maximum mark-up (under price controls), and to compulsory standards. Customs tariffs on manufactured products range from zero to 80%, with the highest rates applying to textiles, clothing and leather products, as well as to metallic and non-metallic furniture and fixtures. The highest ad valorem equivalent of the two specific duties on manufactured products (about 360%) applies to straps of thong-type sandals.

Mauritius is a net exporter of services. Commitments made by Mauritius under GATS largely reflect the current state of liberalization of the sector; monopolies or exclusive rights held by public enterprises limit competition in certain branches (telecommunications, postal, and transportation services) and contribute to high production costs. Measures affecting presence of natural persons are unbound. Mauritius maintains MFN exemptions on financial services under Article II of GATS.

  
Trade Policy and Trading Partners

Mauritius' participation in the multilateral trading system and in various regional agreements reflects its interests as a small, export-oriented economy with advantages in a few products, sugar, textiles and clothing in particular. As part of its economic success is due to preferential market access granted by major trading partners, Mauritius is taking steps to adjust to changes in this international environment.

The adjustment needs to emphasize the streamlining and rationalization of existing incentives so as to lessen the aspects of duality and improve resource allocation. The resultant reduction/elimination of duty and tax concessions could contribute to reducing the public deficit and to facilitating further tariff reforms, which are currently hampered by fiscal concerns as customs duties account for about 50% of tax revenue.

Elimination of non-tariff barriers and of differing customs duties (by source) would enhance the transparency of Mauritius' trade regime. The regime might also play a greater role in attracting investment as more tariffs are bound, the gap between applied and bound rates narrows, and GATS scheduling increases, including perhaps in the context of introducing greater competition in service subsectors such as telecommunications. Overall, such adjustments could contribute to an improved exploitation of Mauritius' comparative advantages, and facilitate the transformation from an export- to an outward-oriented economy.

  
  
Government report Back to top

TRADE POLICY REVIEW BODY: MAURITIUS
Report by the Government — Introduction and Economic development 1995-2000

Small with a land area of approximately 1865 sq. kilometers and densely populated (1.19 million inhabitants in 2000), Mauritius is situated in the Indian Ocean between latitudes 19050’ and 20030’ south and between longitudes 57018’ and 57046’ east, far from its major markets and suppliers of raw materials. Until 1970 a monocrop economy, exporting sugar only, Mauritius has diversified its economy but it still depends heavily on trade to sustain its economic and social developments. The manufacturing, tourism, sugar and financial services sectors are the four main growth pillars of the economy.

The country faces a number of challenges emanating in particular as a result of changes taking place at the international level. Multilateral trade liberalization process emboldened by the advent of the World Trade Organization has led to a decline in the preferential margins of Mauritius on its traditional markets and has exposed the economy to global competition.

The problem of Mauritius, besides the more demanding external economic environment is also exacerbated by the vulnerability emanating from the country’s situation as a small island developing one. Indeed as a Small Island Developing country, Mauritius is constrained in its development by a number of factors characteristic of these countries, including:

  • remoteness and insularity — Mauritius is located far from its major markets;

  • susceptibility to natural disasters. The Island is located in a region frequently affected by adverse climatic conditions such as cyclones and droughts;

  • limited diversification due to a very narrow resource base and small domestic market; the country's production and export bases are heavily concentrated on a limited number of products;

  • access to external capital — the size of the internal market and rising production costs which are characteristics of SIDs impede capital inflows and consequently limit growth prospects.

The economic development prospects of the country will depend on its ability to adjust to the changing economic environment through modernization, technological innovation and economic diversification. However, without secure and enhanced preferential access to markets, assistance to meet adjustment costs and to improve competitiveness, it would be difficult for Mauritius to meet the challenges of globalization.

  
Economic Development of Mauritius 1995-2000

The annual real growth rate of Gross Domestic Product (GDP) at basic prices rose from 5.6% in 1995 to 6.2% in 1996 and then fell to 5.6% in 1997. GDP growth rose to 5.8% in 1998, fell to 2.1% in 1999 and increased to 8.9% in 2000. The low figure of GDP growth in 1999 was due mainly to the severe drought and cyclone experienced by the country.

The average annual growth rate over the period 1995-2000 was 5.7% per annum. The decline in growth rates occurred in all sectors with the exception of manufacturing and construction. The highest annual growth rate in 2000 was attained by agriculture at 28.4%, followed by the hotels and restaurants at 11% and the manufacturing sector at 8.3%. Construction and electricity, gas and water sectors recorded growth rates of 8%.

International trade witnessed an upswing in the total value of trade (imports and exports), increasing from Rs 61.7 billion in 1995 to Rs 89.8 billion in 1998 and to Rs 95.8 billion in 2000. Foreign trade recorded an average nominal growth rate of 9.5% during the period 1995-2000. The trade deficit deteriorated from Rs 7.0 billion in 1995 to Rs 9.7 billion in 1998, increasing by almost Rs 3 billion.

1997, the sharp increase in trade deficit ( Rs 12.4 billion) was mainly due to imports of machinery and transport equipment, specially imports of aircraft and marine vessels amounting to Rs 3.7 billion. The trade deficit in 1998 was lower than that of 1997 due to nearly 19% increase in exports value as against about 8% increase in imports. In 1999, the country’s trade deficit worsened to Rs 16.6 billion since the growth of exports turned negative against a 13.8% growth in imports. The trade deficit was Rs 13.7 billion in 2000.

The total labour force was estimated at 542,000 in 2000 foreign and local combined, representing the country’s economically active population for the production of goods and services. This comprised 527,400 Mauritians and 14,600 foreign workers. The latter accounted for around 2.7% of the total labour force in Mauritius. In 2000, over 54.8% were employed in large establishments including central and local Government and 37.4% in small establishments including the self-employed. The unemployment rate increased from 5.1% in 1995 to 5.5% in 1996 before shooting to 5.9% in 1997. It stood at 5.9% in 1998 and rose again to 6.7% in 1999 and to 8.0% in 2000.

In the past five years, Mauritius continued to pursue its commitment to structural reform and efficient resource allocation with emphasis on manufactured exports, reducing dependence on sugar and stimulating the services sector.