MORIS ZINDABAD

The patrons of the Mauritian « miracle » spare no effort to wow us with pet projects, comparative tables and statistics that are supposed to validate their contributions to our development model. Regardless how scant, alienating and environmentally unfriendly. There is plenty more than meets the eyes. If airfreighted organic bananas and lychees (weighed without branches and leaves!) can be sold inclusive of taxes in France, for instance, at a fraction of the price we pay here without airfreight and taxes, we must seriously ponder how and why the system is failing our productivity so badly. This is far from any suggestion that Dominican Republic and Madagascar outshine us in terms of overall competitiveness. But it certainly makes a mockery of our tiger status. For decades impediments have been piling up to inflate the cost of doing business in Mauritius. Namely, the sullen (of late) and inadequately trained human capital; the market capture by inefficient parastatals and private sector cartels; the vicious cycle entailed by the deliberate policy to depreciate the rupee that hikes borrowing costs (if you manage to break through lenders’ glass ceiling), heavily weighs on production costs due to high import content and is a de facto pay cut for most of us; weird commercial rents; scant infrastructure and internal/external connectivity; corruption that morphs into a quasi-tax.

As the above passes through price structure and merges with dismal governance under successive administrations that bonds bribable government officials and handpicked businessmen, they translate into uncertainties and burdens that warrant a surge in risk premium. When they remain unidentified and unchecked, few enterprises stay unscathed. Otherwise a blessing for mightier, yet uninventive, and rent-seeking businesses but, in a tiny market, a situation of accident waiting to happen. Ironically, in an industrial powerhouse such as Germany, more than 95% national economic output is generated by Small and Medium Enterprises. Compared to about 40% here. For all the talk about economic democratisation, the reverse is what has emerged. The line between a hospitable nation and a miserable lot seems disturbingly thin. Through their self-indulgence and silence, business unions legitimise the nosedive.

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