Budget Deficit, Growing Unemployment ... the Challenges Facing Duval for Budget

Should be expected, with the departure of Ali Mansoor , an electioneering budget may leave skid public spending? Because the current incumbent, Dev Manraj is particularly seen as a friend of the union, especially after the report of the Pay Research Bureau . But it is also the concern of the business side. Expectations are high in the construction sector with the number of site down. Tourism demand new life with our main market, Europe, which is in decline ... Besides expectations in various sectors facing budget which will be presented this Friday, November 8, the flexibility of the Finance Minister Xavier Luc Duval all the more difficult economic indicators are in the red.

This is the case of economic growth, estimated in the budget speech of November 9, 2012 at 4%. "We are very far from the optimism of the Minister of Finance. In all probability, we end the year 2013 with a growth of 2.9% to 3%, " said economist Eric Ng.

He argues that this downward trend growth committed since 2010 shows that beyond the crisis, there are structural weaknesses in the economy. In 2010, the growth rate was 4.2%, in 2011 it was 3.9%, whereas last year it was 3.3%.

"Do not put everything on the account of the economic crisis. Our neighbors in Africa achieve growth rates of 6% to 7% in the same international economic conditions, " says economist, spokesman of MMM, Kee Wing Cheong Li Kwong. .

Certainly there is not the growth rate. There is also the budget deficit is likely to exceed 2.2% in 2013 as it must be provision for an additional sum of Rs 1 billion for the implementation of the PRB (2) report says Eric Ng. This latter notes that if the Ministry of Finance has spent less in the investment budget (capital budget) to improve the level of the budget deficit, it has certainly been at the expense of growth. "But when the minister points out that more than 90% of the measurements have been performed, one wonders if this was indeed the case, it would he boosted the growth rate ? " asks Eric Ng.

Another source of concern for the Ministry of Finance is the unemployment rate is expected to deteriorate for the fifth consecutive year to 8.4% in 2013. Although the Ministry of Finance has no specific projection on this indicator, the unemployment situation may take a dangerous slope. Including a youth unemployment stands at 24%, or one out of four in the age group 16 to 24 years.

"It is clear that unemployment will get worse since there is no real job creation. A situation that is related to our relatively low rate of growth, supported in turn, Swadicq Nuthay, Executive director of Axys Group. It is necessary that the country has a growth rate of more than 4% for it to be able to create jobs. This will not be the case for a long time. "

As for the current account deficit, it is estimated in 2013 at 12.3% of GDP, around Rs 46 billion.In 2012 it amounted to 11.7% of GDP. With a chronic current account deficit, the country is demonstrably committed to a slippery slope. "This is a level which reflects the worrying economic vulnerability of the country " , says Swadicq Nuthay,.

Remains the inflation rate at 3.7% will be below the estimate of the Ministry of Finance. An improvement in this important indicator to put on the account measures the Bank of Mauritius, says Kee Cheong Li Kwong Wing. Given these indicators turn red, the Minister of Finance is definitely on the ropes.

Election budget in mind?

Should be expected, with the departure of Ali Mansoor, an electioneering budget may leave skid public spending? In any case, the reflection emitted by economist Eric Ng, at the 96th Business Forum of the Junior Chamber International held last Wednesday. Among the speakers on the platform of debate, Rajiv Servansingh, director of consulting firm Mind- Africa , Tony Leung Shing house Pricewaterhouse Coopers , Geerish Bucktowonsing, chairman of theMauritius Council of Social Services (MACOSS). " We can not hide the face, the budget is a toolpolicy , "says Eric Ng.

Economic Model

According to Rajiv Servansingh, " There should be some consistency in the policy of the government for the next budget, which would give a better chance to succeed . " It was clear, he said, at present Maurice still looking its business model.

The big question is this: what could come out of this budget to send strong signals to our traders? Because it goes without saying that " these are the companies that create wealth , "says Rajiv Servansingh. Another point raised: positioning Mauritius vis-à-vis Africa is more important than ever. Otherwise, a special look to be granted, he said, the financial services, encouraging them to diversify the products available. And on the tourism sector, he argues for two distinctly different strategies, one for our main market, Europe, and one for emerging markets. " One should not become entangled brushes, these are two parallel strategies, but distinct, " launches the director of consulting firm Mind Africa .

As for the tax Tony Leung Shing, he focused on three aspects including signative lower revenues of the State, or a loss of Rs 3 billion for Mauritius Authority. Revenue He did not fail to remind 60% of state revenues derived from indirect taxes. Small measures in 2012, the introduction of tax " under 10 " on SMS and MMS has reported Rs 120 million to the state coffers, and the tax "2 as" imposed on beverages reported Rs 200 million to the state coffers.He also made mention of the measures that could be applied to the recovery of the construction sector.

And to return to the popular budget Geerish Bucktowonsing, for his part, called for better management of available funds that are available to NGOs. Maurice must have an educational plan to better support the integration of citizenship on the national plan for a " sustainable, healthy Mauritius, " said the president of Macoss.