Moody's: Weak government finances pressure Mauritius ratings

In its annual report on Mauritius, Moody's Investors Service said the government's Baa2 foreign currency bond rating and Baa1 investment-grade foreign currency country ceiling are under pressure from changes in the global trading regime and weak government finances.

The decline of the clothing/textiles and sugar sectors has caused economic growth to slow to about half its long-run average and pushed up unemployment. Despite the existence of a few bright spots in the economy, Moody's said the weak growth is likely to persist over the short term as structural reform continues.

On the external front, high oil prices have pushed up the value of imports while exports have sagged, causing the current account deficit to soar and straining the balance of payments.

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