In the news this week, the Minister of Finance, Renganaden Padayachy is meeting with local artists ahead of the 2023-2024 budget, 27 endemic trees have been planted at La Citadelle as part of a reforestation program and household debt is on the rise.
Reforestation program at the Citadelle
A reforestation project of the hill of La Citadelle in Port-Louis was launched earlier this week. Varta, the battery brand represented in Mauritius by Scott & Co Ltd, has partnered with the Ressources et Nature (FORENA) Foundation for this project. From now on, for every ten kilograms of used batteries collected by Scott & Co Ltd through their Varta battery recycling program, an endemic tree such as Bois Cabris, Palmiste Bouteille, Bois de Rat or Bois d'ébène blanc will be planted by the NGO.
The project was officially launched on Monday during a ceremony at La Citadelle. Representatives from both parties planted 27 endemic trees, such as Bois Cabris, Palmiste Bouteille, Bois de Rat, Vacoas and Bois d'ébène blanc, corresponding to the 266 kilograms of used batteries collected by Scott & Co Ltd last year from 20 participating hotels in collaboration with BEM Recycling.
Pre-budget consultations continue
The Minister of Finance, Renganaden Padayachy, met with local artists in Port-Louis earlier this week to discuss the situation of the cultural sector in preparation for the upcoming 2023-2024 budget. He also met with representatives from the Association des Hôteliers et Restaurateurs de l'Ile Maurice (AHRIM), the Association des Hotels de Charme, the Association of Tourism Professionals, and the Association of Furniture Manufacturers and Small & Medium Enterprises Federation (SMEF), among others, on Tuesday, March 21st. The issue of inflation came up, against which the minister officially declared war on Monday during the Public Private Joint Committee held in Ébène.
Increase in household debt
The latest Financial Stability Report from the Bank of Mauritius has been released, showing that Mauritian households' debt reached Rs 146 billion in January 2023. Despite inflation, household loans increased significantly during the first half of 2022, especially for mortgages. In total, the annual growth rate of household credit reached its highest level in eight years, at 13.3% for the month of June 2022. Furthermore, non-real estate loans to households also increased at an annual rate of 12.6% by the end of June 2022.
According to the central bank's report, this phenomenon can mainly be explained by government aid policies, as well as a favorable labor market. Thus, even though the increase in the benchmark interest rate at the beginning of 2022 led to higher borrowing costs, market interest rates remained favorable for mortgage credit at the time, allowing for continued growth in the number of loans.
The Bank of Mauritius warns that in the current conditions, these households may struggle to repay these loans. Indeed, inflation could have an impact on their ability to repay their debts. And given the trade deficit and severe depreciation of the rupee against other currencies, this situation does not seem likely to stop.
