Three weeks away from the presentation of the budget for the next financial year, optimism prevails both in the government and the private sector. This is at least what they showed during their latest discussions on the economic situation last Saturday. It nevertheless remains that all stakeholders are aware that an effort needs to be made.

The worrying budget deficit is one of the biggest problems that the government, in collaboration with the private sector, will have to tackle. And the deputy prime minister and minister of finance, Pravind Jugnauth, proved to be quite preoccupied with the budget constraints. He made it clear that the government will not achieve the objective it has fixed for 2003-2004. The situation may even remain tough the following year.

This pessimism is due to the high number of investments that the government has made in fields such as education and housing for example. Moreover, the country has to ?pay the second part of the recommendations of the Pay Research Bureau and also reimburse the public debt?, the minister of finance explained.

All the stakeholders agree that there will still be difficulties in the textile and sugar sectors. However, according to the prime minister, ?the worst is now behind us? and the public and private sectors will make all possible efforts to save companies and jobs while encouraging the creation of new companies in the textile industry.

The prime minister also stressed that the AGOA III could experience new developments after his visit to Washington. President Bush is said to have taken new initiatives to bring the AGOA III before the senate. However this is not certain and Mauritius will not benefit from an amendment anyway.

According to Paul Bérenger, the situation, on a national level, remains quite positive. He mentioned the GDP growth expected by the Central Statistics Office (CSO) for 2004, which may be around 5.3%. He added that the private sector was even more optimistic with an expected growth rate of 5.5%.

He also referred to the number of jobs created between June 2002 and June 2003 insisting on the fact that the CSO has revised its previous estimates and that the latest ones are even higher. According to the latest report, 14 400 jobs were created during this period, which constitutes a ?very good achievement.? The government will now have to sustain this high performance.

The PM declared himself very happy with the way Pravind Jugnauth conducted the tripartite negotiations. Despite a tough economic situation he has succeeded in reaching a consensus regarding wage compensation, he said. Every stakeholder has found something positive in it.

The head of government gave a most positive impression on the international economic situation. The International Monetary Fund, he said, reviewed its forecast and expects a higher growth for 2004 that is to say 4.6%, which must be a positive sign. On the whole, we have witnessed ?a recovery of the world economy? since the second half of last year.

However, the revival in China for instance has a negative impact on Mauritius, and also on the world economy. The PM qualified the Chinese economy as ?overheated?, thus leading to a rise in the price of cement, iron, steel, as well as the freight rate. Moreover, petrol prices have skyrocketed, which will inevitably impact negatively on our economy.

On the whole, all the stakeholders once more declared themselves very happy with the partnership between the public and the private sectors. Paul Bérenger, as usual, did not miss the opportunity of saying that this was a ?great partnership in the the interest of the country?, as it allowed a real discussion between the parties involved in the economy. Ariff Currimjee, the newly nominated president of the Joint Economic Council (JEC), declared himself very ?impressed? by the disciplined approach that characterised this meeting, the first one for him.

Thanks to these frequent meetings, some ways and means have been outlined to help the government to get back on its feet. For example, the Medium Term expenditure framework has been created in order to combine expenses and the Mauritius Revenue Authority will head all the organisations involved in the direct and indirect tax system. The government intends to favour the Private Public Partnership to finance projects that could attract investors to lighten the task of the development budget. All these measures should strengthen the government in its conviction that these meetings really benefit the country.

The PM is very happy with the way Pravind Jugnauth conducted the tripartite negotiations. Despite a tough economic situation he has succeeded in reaching consensus regarding wage compensation.

24 hour deadline for BOI?

The Board of Investment (BOI) has often been the subject of criticisms by the private sector, which has often complained about the administrative slowness of the Board. The BOI is studying a means of reducing the time taken to deliver ?investment certificates? so as to be able to deliver them within 24 hours. This certificate is the first one to be issued by the BOI before the various ministries deliver theirs. In order to achieve this goal, the BOI will skip unessential steps like a detailed feasibility study. It will be applicable to some fields such as ITC or the EPZ sector only. A declaration made by the investor, which gives a general outline of the project as a whole, could be sufficient to obtain the investment certificate. If the project is in accordance with the BOI?s criteria, the certificate could well be issued within 24 hours.The Technical Committee could be replaced by the Facilitation Committee constituted by the other ministries in order to speed up the delivery of the other permits.