MAURITIUS

RISK RATING
Elevated
Default High Risk Score 5.00
Normal Average 1.69
Weighted Average 1.37
RISK RATING HISTORY
RISK RATING SCALE

Risk Rating Scale

Severe: 8.0 to 10
High: 6.0 to 7.9
Elevated: 4.0 to 5.9
Moderate: 2.0 to 3.9
Low: 0.0 to 1.9
EXCHANGE RATE
Country Outlook

Mauritius has been hailed as an African and global success story in the fight against COVID-19. While Mauritius has fared well to contain the virus, it will not escape the wider global economic repercussions of COVID-19 that will be felt through significantly reduced tourism to the island state. This loss in revenue threatens to impact the country’s already precarious debt profile this year. Moreover, the blacklisting of Mauritius by the European Union (EU), along with the breakdown in a tax treaty with Senegal in 2020 mark the end of an era in Mauritian-EU and -African relations. As such, while Mauritius may claim victory over COVID-19, it is not entirely out of the woods. Transparency concerns have also been raised following a number of corruption scandals. Several major challenges lie ahead for Prime Minister Pravind Jugnauth.

  • Mauritius is listed on the EU‚Äôs revised list of high-risk countries, allegedly having ‚Äústrategic deficiencies‚ÄĚ in its anti-money laundering and counter-terrorist financing frameworks. The anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) legal framework has been extensively revamped and Mauritius is largely compliant or compliant with the vast majority of its recommendations. However, Mauritius has still to demonstrate an increased level of effectiveness of its AML/CFT systems which likely led to its inclusion on the EU Commission‚Äôs list. In 2020, Senegal terminated its double taxation agreement with Mauritius, and alleged that the agreement had cost it some USD 257 million in lost tax revenue over 17 years. This may influence the outcome of other negotiations by other African countries looking to revise their tax treaties.
  • Rising unemployment is associated with an increase, albeit limited, in petty and violent crime. There are few major security threats in Mauritius. The island is physically isolated and has enjoyed a stable political climate and increasingly high per-capita wealth since the mid-1970s. Communal and ethnic identities are a feature of the political landscape, but violence is rare. Demonstrations are also rare, and typically peaceful. However, rising joblessness, perceptions of corruption, and incidents of mismanagement such as the 2020 tanker spill off the coast of Mauritius, pose fresh risk of protests. There is a small chance of pirate activity stemming from Somalia making its way as far south as Mauritius, but no incidents have been reported in its waters so far.
  • The economic impact of the pandemic has been serious, and unemployment is set to double.¬† One of the sectors that has been the hardest hit because of the virus is the country‚Äôs tourism industry, which accounts for up to 25 percent of GDP. In another blow to the tourism sector, the country‚Äôs flag carrier, Air Mauritius, has been in voluntary administration since 2020. Other economic sectors such as the textile, transportation, and manufacturing sectors are also expected to be impacted. With public debt already at 68.7 percent of GDP as of 2019, the IMF has urged Mauritius to rein in its borrowing, while credit rating agencies have put the country on a negative outlook.
CUMULATIVE AND DAILY COVID-19 INFECTIONS AND DEATH RATE
INTERNATIONAL MONETARY FUND | DATAMAPPER
Risk Perils
Political Instability
1.2
Expropriation, Nationalisation, Confiscation & Deprivation
0.5
Contract Frustration & Breach
1.8
Taxation
1.0
Bribery & Corruption
1.0
Regulatory Burden
1.2
Strikes, Riots & Civil Commotion
1.2
Security
1.0
Sovereign Default
3.0
Economic Volatiliy
5.0

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