Mauritius Business Minister Jim Seetaram noted that the SME sector is increasingly being recognized as one of economic powerhouses for the island economy, providing employment to as much as 54% of the total working population.

Speaking on the occasion of the 165th Annual General Meeting (AGM) of the Mauritius Chambers of Commerce and Industry (MCCI), Seetaram went on to state that the estimated share of SME businesses towards the Mauritian GDP in 2015 is a towering 40%.

Held yesterday at the Labourdonnais Waterfront Hotel in Port-Louis, the AGM also saw outgoing MCCI President Ganesh Ramalingum commenting on declining investment in the island economy.

Ramalingum said that the economic situation in Mauritius is worsening with a reduction of 4.3% in the Gross Domestic Fixed Capital Formation in 2013 and investment has decreased thrice in the last four years.

He noted that another issue in Mauritius during crises is that the fall in private investment is not compensated by enhanced public investment. In 2013, a 5% fall was felt in the public sector investment relative to GDP from 6.1% in 2010.

Besides, the rate of growth in consumption has fallen to 2.4% last year compared to 2.8% recorded in 2012. Savings are also on a decline, with the Gross National Savings relative to GDP having decreased to 14% in 2013 compared to a rate of 15.1% in 2012, he stressed.

Commenting on the deficit in exports of goods and services, the MCCI president stated that while exports saw only a slight increase of 0.5% in 2013, imports went up 2.9%.He also observed that exports of goods increased by 3% while service exports registered a fall of 1.4%, due to a slight depreciation of the rupee vis-à-vis the currencies of major trading partners.

“The signs are mixed at best. The recovery is evident, but some of the figures mentioned still suggest that there are risks that exist,” he said.

Ramalingum went on to express his regrets at the national ID card project not being entrusted to a local company, stating that “we have the skills, the tools and the ability to undertake even much more than this.”

For the outgoing president, Mauritius Vision 2020 was a formidable document that identified the right opportunities. Unfortunately, he noted that good intentions have been derailed by pointless questions which go beyond the economic and social considerations required by good governance.

“We do not require a government that is there only to fix what is wrong, but also to build what is right,” he concluded.

Meanwhile, Mauritius minister for industry and consumer protection, Cader Sayed Hossen, said that foreign direct investment is needed in technology-intensive activities such as the production of high precision plastic, parts and tooling, micro-mechanic products, bio-based products, new health and wellness products, medical devices, among others.

“I believe that recent political stability in Madagascar and enhanced air links with China and the Gulf countries also represent positive developments that have to be harnessed to make possible a more diversified industrial landscape in Mauritius,” said Cader Sayed Hossen.

On Mauritius’ future as a petroleum hub, he added that the oil majors have finalized plans for the construction of 25,000 MT of additional storage capacity for petroleum products which will be operational in August 2015.

He also noted that the banking sector must support SMEs by adopting necessary measures to reduce cost of lending, minimising charges and other commissions and reviewing penalty rates applied.

The AGM ended with Sebastien Mamet from Terragri Ltd being elected the new MCCI president, while Helene Echevin from Pick n Eat Ltd took over as Vice President for the year 2014-15.

By Marie-Lorry Coret and Cecilia Samoisi

Image (Cecilia Samoisi for AfricaMoney): Seated in the middle, the new MCCI president,  Sebastien Mamet from Terragri Ltd.

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[Article updated on April 1, 2014 : Title amended as the quote was wrongly attributed to minister Jim Seetaram.]