I. Objectives

1. The AITIC Special Session was organised at the request of the Mauritian authorities to complement their Trade Policy Review held at the WTO on 23 and 25 April 2008. The meeting had three main objectives:

1. to present the economic reform programme launched by Mauritius in 2006, together with the results achieved to date and the challenges that lie ahead;
2. to communicate Mauritius’ aid for trade needs to the community of bilateral and international donors in order to foster their support;
3. to share with other developing countries the experience of Mauritius in implementing reforms and contributing to the South-South dialogue.

II. Issues Raised

2. The main issues under discussion were the Economic Reform Programme, the orientations of Mauritius’ trade policy and its trade-related technical assistance needs. After a description of the constraints, both external (erosion of preferences, end of the Multifibre Agreement, fall of the price of sugar and surge of energy costs) and internal (structural rigidities), which guided the drafting of the Programme, its underlying key principles were spelt out: market opening, competitiveness and an efficient economy.

3. It is estimated that the Reform Programme will cost 4 billion euros over 10 years. It is currently financed through an optimisation of the taxation system, the establishment of a budget for each programme and the creation of a climate more favourable to investment and business. The effects on the economy can already be felt after 18 months of implementation, as shown by a number of indicators, such as the growth rate which stood at 5.8 per cent in 2007 as against 2.3 per cent in 2005, and the budget deficit which has been reduced from 5.3 per cent to 3.8 per cent over the same period.   

4. The success of the WTO negotiations is important for Mauritius. The outcome must include a special and differential treatment and additional flexibilities for developing countries, in particular for small and vulnerable economies, especially in the negotiations on services, agriculture and fisheries. Any improvement in market access would, however, be pointless without strengthened production capacity and a reduction of supply-side constraints in developing countries.

5. The Reform Programme gives prime importance to regional integration. Projects initiated by SADC and COMESA, especially those which support businesses bearing the impact of reforms, must be encouraged. Several integrating projects have recently been presented to the World Bank and the African Development Bank. The scope of the adjustment measures required by these reforms does, nevertheless, require a support from the international community in order to carry them through as quickly as possible.

6. Mauritius, for its part, believes it has already implemented most of the recommendations of the Aid for Trade Task Force. The donor community must now fulfil its commitments and support the country’s efforts. The next Aid for Trade Global Review due in 2009 will be the occasion to take stock of progress in this regard.

7. In the ensuing discussions, it emerged that the commitment shown by the Mauritian authorities was commonly held to be a leading example of how to implement Aid for Trade. The European Commission (EC) expressed its willingness to support the various aspects of the Reform Programme. In addition to the activities it is already pursuing locally with regard to infrastructure and support for developing alternative sources of energy, the EC was interested in the social and democratisation aspects of the economy foreseen by the programme.  

8. The People’s Republic of China welcomed the actions taken by Mauritius to diversify its economic partners and indicated its readiness to contribute to responding to its assistance needs. The ITC also expressed its readiness to support the ongoing reforms, whilst stressing the savings that a regional approach to the Programme could generate. Switzerland, a country whose domestic market size and market openness are comparable to Mauritius, would look favourably at requests from Mauritius.