?THE MOOD has changed?. This expression was Prime Minister Paul Bérenger?s leitmotiv at the press conference following the meeting between government and private sector. Both parties have adopted ?cautious optimism? for 2004, said the PM. The two parties may have used the meeting to reassure the population and, above all, themselves. Neither government nor private sector?s leaders spelled out any new policies.

Government and Joint Economic Council (JEC) members spent the whole time congratulating one another on the good economic results, which they see as a good omen for 2004.

The PM explained that though 2003 was a difficult year, estimates for 2004 are optimistic. Economic growth is expected to hover between 5% and 6% against 4.4% last year. Paul Bérenger, supported by JEC, explained that all the problems that led to a bad year 2003 are now behind us. The international outlook is brighter and it is bound to bring in more foreign investment. Administrative procedures such as permits have been smoothed down though more efforts are needed in that field.

Wrong perception

Although he tried to reassure the general public, a few sensitive issues remain. The PM said job creation indicators are very encouraging. Even in the textile industry where the situation remains uncertain, the mood has changed. Through ?restructuring, training and retraining?, Paul Bérenger wants to save as many jobs as possible. He also pointed out that 13 100 new jobs have been created between June 2002 and June 2003. Yet, unemployment is still around10 %.

The PM then commented the ?wrong perception? (another favourite expression of the PM these days) the public has of price increases. He even added that people believe prices have gone up because the press ? particularly caricaturists - convey this ?wrong impression?. Even if some prices have indeed risen due to increase in import prices, he explained that inflation was going down.

According to government, only two issues will be hard to solve this year. Budget deficit remains a difficult item (even if Pravind Jugnauth mentioned it was under control during the press conference). The gap between savings and investment rates is worrying. Savings rate is satisfactory at 27 % while investment rate is still below expectations at 22.7 %.

Sudden optimism

JEC Chairman Gilbert Espitalier Noël however came to the rescue. He explained that investment could not have been better, considering the gloomy international outlook and high interest rates. Now that those factors are no longer in the way, investment should thrive.

The economic sector that received special attention was tourism for various reasons. First, it will create jobs in the short term. Then, the whole tourist industry is waiting for development concerning the liberalisation of air access. The PM, however, pointed out that he would not ?rush into anything?, and, more importantly, he is against chartered flights. He agrees with JEC that a second airline is necessary to cater for the 4 000 additional bedplaces but no definite choice has been made yet.

The sudden optimism of the private sector was very surprising. It contrasts sharply with the results of the PriceWaterHouse survey two weeks before on the low level of satisfaction of the private sector regarding government economic policies. The PM expressed his lack of trust in polls and his belief that the government and private sector collaboration is very fruitful. So fruitful that they have decided to meet every two months as from now. So much the better?

Pauline ETIENNE

New firefighting measures in the making

During the press conference, the Prime Minister also mentioned the fire in La Corderie Street, Port- Louis. In response to the many criticisms of the firemen?s work, he said they were professionals and citizens had no right to give orders to firefighters. Besides, he considered those criticisms unjustified, as the preliminary report states the firemen performed well. They arrived on the premises quickly and the rumors about leaking fire hoses are totally false. However, considering the number of fires in the capital, the Prime Minister said he had dealt with the issue of ?Upgrading fire services? in the morning of the same day the fire broke out.