Surréaliste indeed!

The allegation that an underhand scheme was being concocted read as such: ?Bientôt, contre toute attente, la Banque de Maurice(BoM) va?baisser le taux Lombard !? But, on the basis of the trend in some components of aggregate demand and the extent of the output gap, the BoM, however, increased the Lombard Rate by 25 base points from 9.50 percent to 9.75 percent as pre-emptive measures to dampen inflationary pressures and expectations.

Surréaliste indeed !!! Why is it that our dear friend is so often off the mark? Maybe because he believes that ?l?économie étant une science humaine dans un monde imparfait, toute conclusion est discutable?. We would, of course, be surrealistic if we extend that logic to a kind of relativism preaching double standard and that truth and reality are in the eye of the beholder and that everything is shifting, relative and open to question. (This reminds us of the recently departed French intellectual, Jacques Derrida, who precipitated the death of certainty). But we would at the very least expect the conclusions to ascribe to a minimum degree of consistency and stand the test of ?deconstruction?. In 1999, with the rate of interest at 14% and nominal GDP growth at 8%, the BoM was pursuing a too restrictive monetary policy. Instead of recommending a lowering of the interest rate, our friend, in total contradiction to his present stand and his rule of thumb, acknowledged this monetary stance in the Business Magazine issue of the 5th October 1999 and remarked: ?On comprend que la BoM veuille à tout prix éviter une expansion monétaire excessive pour combattre l?inflation.?

In the same article, he brilliantly scrutinized some aspects of the degree of competition in our non-collusive oligopolistic banking system. It reads thus: ?Une façon de limiter ce risque consiste à pratiquer des taux de crédit relativement moins avantageux pour l?emprunteur mais nos banques n?ont pas osé épouser une telle solution, vu la concurrence farouche qui les oppose. Ce qui explique que, dans la course aux dépôts avec montée des taux d?intérêt, les banques ont accru leur prise de risque en resserrant leurs marges.? But when Mr Jankee of the UoM , one of the participants of the lively debate on the banking sector, branded the sector as an inefficient collusive cartel determining the borrowing and lending rate margins, our friend, who was then in the Chair, acknowledged meekly. It is understandable given that ?toute conclusion est discutable?.

Another doubtful conclusion is the ?pessimisme ambiant? noted by Pluriconseil. In terms of the Macroeconomic Environment Index of the recent World Economic Forum report, which is calculated on the basis of macroeconomic stability hard data and macroeconomic stability survey data, Mauritius improves its ranking from 57th last year to 50th this year. This shows that a 4.6% growth rate of the economy for 2004 is reasonable given the exceptional circumstances; other developing economies are also finding the going tough with increases in freight, petroleum and other inputs and the threat from some Asian economies with their undervalued currencies. One of the questions of the macroeconomic stability survey was: ?Is your country?s economy likely to be in a recession next year?? Our improvement in ranking shows that ?le baromètre économique? depicts an all-out optimism, that also before we had obtained the third country fabric dero- gation. This is in stark contradiction with the baromètre Pluriconseil of our friend. Anyway, comme dirait the late J. Derida, ?nothing is quite as it appears, surely not facts but mere perceptions.?

A.RTon