The Mauritian economy has undergone a marked structural transformation over the past three decades, with the relative importance of agriculture declining significantly and that of manufacturing increasingly considerably. The share of the services sector in Gross Domestic Product (GDP) has been fairly stable since the early 1980s. In fact, services make the largest contribution to GDP and to total employment. There has also been an important increase in trade in services.
A closer look at the services sector shows that its three largest subsectors are:
- Wholesale and retail trade, restaurants, and hotels
- Financing, insurance, real estate, and business services
- Transport, storage, and communication.
The ranking of the first subsector reflects the high level of importance of tourism in Mauritius. The other two subsectors consist of producer services, and their ranking indicates the importance of a whole range of complementary services required to support economic growth and development.
The services sector also offered more employment opportunities than either agriculture or manufacturing. At present, services provide around 60 percent of total employment in large establishments. As expected, the contribution of agriculture declined significantly whereas that of manufacturing increased considerably.
With the rapid expansion of the Mauritius Export Processing Zone (MEPZ), total exports of goods increased significantly. Imports of raw materials and machinery, required to support the expansion of the manufacturing sector, also increased. Total trade in goods (exports plus imports) in fact grew much faster than total trade in services in spite of the rapid expansion of the tourist sector. However, this trend has been reversed as from the early 1990s.
At present Mauritius is diversifying more towards the financial services and tourism.The Mauritian economy is mainly driven by the tertiary sector which generates close to 70 per cent of GDP. That sector grew by 6 per cent in 2008, slightly lower than the 6.7 per cent rate for 2007. Tourism has been an important engine of the country’s sustained economic growth. However, the picture of the Mauritian tourism industry in 2008 is quite different from that of previous years. By all accounts, the upward trend in tourist arrivals has experienced a setback. After having grown by an impressive 14 per cent in 2007, the number of tourist arrivals grew by only 3.1 per cent in 2008 to reach 935 000. There are two main explanations for this poor performance: the global slowdown and, to a lesser extent, the appreciation of the Mauritian rupee vis-à-vis the currencies of the main tourism markets. The effects of the global slowdown in 2009 will undoubtedly reduce the number of tourist arrivals from traditional markets. Of particular concern is the prospect of a prolonged recession in France and the UK, the two largest tourist markets for Mauritius.