Contemporary African Political Economy

Series EditorEunice N. Sahle

University of North Carolina Chapel HillDurham, NC, USA

Contemporary African Political Economy (CAPE) publishes social science research that examines the intersection of political, social, and economic processes in contemporary Africa. The series is distinguished especially by its focus on the spatial, gendered, and cultural dimensions of these pro-cesses, as well as its emphasis on promoting empirically situated research. As consultancy-driven work has emerged in the last two decades as the dominant model of knowledge production about African politics and economy, CAPE offers an alternate intellectual space for scholarship that challenges theoretical and empirical orthodoxies and locates political and economic processes within their structural, historical, global, and local contexts. As an interdisciplinary series, CAPE broadens the field of tradi-tional political economy by welcoming contributions from the fields of Anthropology, Development Studies, Geography, Health, Law, Political Science, Sociology and Women’s and Gender Studies. The Series Editor and Advisory Board particularly invite submissions focusing on the follow-ing thematic areas: urban processes; democracy and citizenship; agrarian structures, food security, and global commodity chains; health, education, and development; environment and climate change; social movements; immigration and African diaspora formations; natural resources, extractive industries, and global economy; media and socio-political processes; development and globalization; and conflict, displacement, and refugees.

Advisory BoardBertha O. Koda, University of Dar es Salaam, TanzaniaBrij Maharaj, University of KwaZulu-Natal, South AfricaThandika Mkandawire, London School of Economics and Political Science, UKJames Murombedzi, Council for the Development of Social Research in Africa, SenegalJohn Pickles, the University of North Carolina at Chapel Hill, USAWisdom J. Tettey, University of British Columbia, Canada

More information about this series at http://www.palgrave.com/gp/series/14915

Vanessa T. Tang Timothy M. Shaw • Merle G. Holden

Editors

Development and Sustainable Growth

of Mauritius

Contemporary African Political EconomyISBN 978-3-319-96165-1 ISBN 978-3-319-96166-8 (eBook)https://doi.org/10.1007/978-3-319-96166-8

Library of Congress Control Number: 2018959854

© The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Switzerland AG, part of Springer Nature 2019This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed.The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use.The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

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This Palgrave Macmillan imprint is published by the registered company Springer Nature Switzerland AGThe registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland

EditorsVanessa T. TangSchool of Accounting, Economics & FinanceUniversity of KwaZulu-Natal Durban, South Africa

Merle G. HoldenUniversity of KwaZulu-NatalDurban, South Africa

Timothy M. ShawDepartment of Conflict Resolution, Human Security & Global GovernanceUniversity of MassachusettsBoston, MA, USA

v

This edited collection on Development and Sustainable Growth of Mauritius could not be timelier. The small African island of Mauritius celebrated the 50th anniversary of its independence on March 12, 2018. As a relatively young country, its economic success and the strength of its political insti-tutions have stood in sharp contrast to that of other African countries for many years, if not decades. While the sub-Saharan African region experi-enced significant economic and political challenges especially in the 1980s and most of the 1990s, the average growth of Mauritius over those two decades was 4.3% and 5.2% respectively. In the first decade of the new mil-lennium, growth rates in Mauritius averaged 4.7%, and despite the global financial crisis, growth since 2010 has averaged close to 4%. With a per capita gross domestic product (GDP) on purchasing power parity (PPP) of about US$16,000, placing the African island economy among the top five highest income earners in Africa, this makes this country a worthy case study. The country has reported impressive economic achievements rang-ing from greater openness to trade, diversification to export-oriented industrialization and deeper structural change through sound policies and good governance. Since 2000, the World Economic Forum Africa Competitiveness reports have ranked Mauritius as one of the four most competitive nations in Africa. Most recently, according to the World Bank Africa Competitiveness Report, the country ranked as the most competi-tive nation in the continent. Furthermore, as an upper-middle income nation, Mauritius has topped the Ibrahim Index of African Governance (IIAG) in the last few years. On overall governance, the 2017 IIAG ranked Mauritius first among 54 African countries, followed by Seychelles and

Preface

vi PREFACE

Botswana in second and third place respectively. Also, Mauritius is today ranked well ahead of its sub-Saharan African counterparts in human devel-opment. According to the United Nations Development Programme (UNDP) Human Development Index (HDI), Mauritius and Seychelles are presently the only Southern African Development Community (SADC) member states that have achieved ‘high’ levels of human development. Other SADC countries, such as South Africa and Botswana, fall in the ‘medium’ category levels of human development.

The country is also unique in the African context in that regularly held multiparty elections have been followed by peaceful democratic transi-tions. Given the conditions that it faced at independence, namely, a mono-crop economy, bare natural resources, overpopulation and a multiethnic society, this economic success is all the more remarkable. However, the reasons behind the so-called Mauritian ‘miracle’ remain debatable. While the institutional explanations have been favored by various authors, they cannot on their own explain why Mauritius is where it is today. There is/are undoubtedly, an/several X-factor(s). While the experience of Mauritius may not be easily replicable elsewhere, some features of its success offer important lessons for other developing countries including the lesser developed small island states. The importance of structural diversification, greater openness to trade, inclusive political institutions, and public and private partnerships that can manage effectively private sector business dif-ferences have been key drivers of Mauritian development. Inclusive politi-cal institutions have also managed ethnic diversity and made painful economic reforms more acceptable.

The economic success of Mauritius echoes those of a developmental state—a term coined by Chalmers Johnson based on the experience of a few Asian countries such as Japan, South Korea and Taiwan—where the state played an active role to achieve industrial mobilization by working with the private sector. But the characterization of Mauritius as a develop-mental state by various scholars cannot be straightforward due to certain unique features—including as scholars of this book have stressed—that are not present elsewhere. State-led policies in Mauritius were conducted by democratic, and not semi-authoritarian or authoritarian, regimes. Devel-opment was able to take place alongside a comprehensive social welfare system that includes free access to public health and public education, and a non-contributory universal pension. The state also made use of the right mix of trade policies: import substitution and export promotion through the Export Processing Zone (EPZ) in the 1970s, followed by trade liber-alization in the 1980s and 1990s.

vii PREFACE

The various chapters in this edited collection analyze and reflect on the Mauritian case through different lenses. They argue that a way forward for the Mauritian developmental state is an urgent need to find innovative ways to adapt and transform this island economy in an increasingly com-petitive international economic environment.

(Both born and raised in Mauritius.)

Ottawa, ON, Canada Yiagadeesen (Teddy) SamyDurban, South Africa Vanessa T. Tang

ix

I would like to express my deep appreciation to Eunice N. Sahle, Commis-sioning Editor for Contemporary African Political Economy Series, and Alina Yurova, Editor for Regional Politics and Development Studies, at Palgrave Macmillan (NYC), for providing the environment which enabled us to publish this volume and for their support and guidance throughout this project.

I am deeply grateful to Timothy Shaw for his generous introduction to me of many great scholars over the years, but, more importantly, for his invaluable guidance, comments and suggestions throughout the develop-ment of this book. I am equally grateful to Merle Holden for her patience, excellent feedback and motivation.

I would like to extend my deepest gratitude to all the contributors of this collection for their excellent work, and despite their busy work sched-ules were willing to promptly attend to several rounds of revisions. Our gratitude and recognitions also go to the anonymous Palgrave Macmillan reviewers and colleagues, R. A. Llorca-Vivero, S. K. Sobhee, G. Wignaraja, A. Wentzel, C. Oneill, T. Nichola, P. Moores-Pitt, L. Nkosi, D. Makuzawa, G. Oldham, J. Jones, P. Koch-Kiepel, J. McCarthy and D. Barraclough who provided insightful comments and suggestions. The production of this unique collection would not have been possible without your support and motivation.

We are also grateful to Deborah Brautigam and Tania Diolle, the Australian Government’s Department for Foreign Affairs and Trade and

acknowledgments

x ACKNOWLEDGMENTS

Sarah O’Connor from International Development Leadership; David Hudson and Edward Avenell both from the Department of International Development and to David Hammond and Cambridge University for giving us the permission to include two classic papers in this book.

Our deep appreciation goes to the Palgrave Macmillan editorial and design team for their patience and support. Special thanks to Mary Fata for her excellent editorial assistance and coordination.

My sincere appreciation is also extended to friends especially Varuna, Pamela, Meena, Lauren, Phyllis, Pat, Thandi, Brigitte, Sarane, Julian, Neil, Sean, Edward, Oscar, Patrick, Ramiro, Clive, Wayne, Max, Paul, Bruno, Berny, Kriben, Ufo and Rodrigo for your encouragement and support.

Lastly, to my family in Mauritius: thank you for your love and blessings. This book is dedicated to my late father, mother and sister Alane M. Noel for your resilience. In closing, I am pleased that Development and Sustainable Growth of Mauritius has received excellent reviews nationally and globally. My heartfelt appreciation to Renganaden Padayachy, Verena Tandrayen-Ragoobur, Daniel C. Bach, Xiangming Chen, Pamela K. Mbabazi, Kaya Ngqaka and Rodrigo Tavares. I hope this collection can inspire readers in search of growth and prosperity.

Vanessa T. Tang

xi

“Long gone are the days when complacent foreign experts and international insti-tutions prognosed a chaotic future for Mauritius due to ethnic fragmentation, polarized economic elites, a mono-crop economy and unregulated demographic expansion. For nearly half a century, as this volume demonstrates convincingly, the country has been associated with an unrelenting ability to combine pragmatism with innovation, along with informal and institutionalized coalition-building mechanisms that straddle across ethnic and economic polarisation. The outcome is the entanglement of developmental goals with democratic politics and policies, an alchemy unique in Africa. This collection is a valuable addition to the debate on the path to public, developmental, democratic and sustainable policies in Africa.”

—Daniel C. Bach, CNRS Research Professor Emeritus, University of Bordeaux, France

“Focused on Mauritius, this important and timely book renews a long-standing research agenda and debate about the relative merits of development strategies based on import substitution vs export orientation. Through a set of well-prepared chapters about different aspects of Mauritius’ economic development before and after its independence in 1968, the authors have generated rich evidence and insights on why and how this small island economy has been successful in transi-tioning from commodity production to manufacturing through special economic zones (SEZs) and then to services and innovation. In addition, the book offers Mauritius as a fresh case for better understanding the comparative and flexible advantages of small economies including Taiwan, Hong Kong, and Singapore early on and for drawing pertinent policy lessons for other developing African economies today.”

—Xiangming Chen, Professor, Trinity College, USA, and Fudan University, China

“Development and Sustainable Growth of Mauritius examines how this island nation has managed to transform itself into an upper middle income country in this era of globalisation. Written by a collection of international researchers and schol-ars, this book provides unique insights into the processes of Mauritius transformation and makes a solid contribution to African scholarship and literature. A must read for students, researchers, politicians and development practitioners.”—Pamela K. Mbabazi, Head of Research, Institute for Peace and Security Studies,

African Union, Addis Ababa University, Ethiopia

Praise for Development and Sustainable Growth of Mauritius

xii PRAISE FOR DEVELOPMENT AND SUSTAINABLE GROWTH OF MAURITIUS

“This is one of the most insightful and thought provoking scholarly literature on Mauritius economic transformation. It reveals how pragmatic tools applied for eco-nomic growth, such as special economic zones in Mauritius, have been effectively used to advance industrialization and how such measures have successfully advanced Mauritius as a developmental state. This is a unique and pragmatic analysis of Mauritius that I would advise all policy makers, especially in Africa, to read.”

—Kaya Ngqaka, Chief Operating Officer, Dube Trade Port Special Economic Zone, Kwa-Zulu Natal, South Africa

“Mauritius provides an excellent case study in economic development. The coun-try has successfully transitioned from a monocrop to a modern multi-sector econ-omy. It is probably the only country in the world to have recorded, since 1981, the longest stream of positive growth rate. Thanks to the timely implementation of appropriate economic and financial policies and the vision and leadership of poli-cymakers, the country has been able to uplift itself to an upper middle-income economy. Mauritius is also a living example of how it has coped with global challenges and pressures and has benefited from public-private sector’s partner-ship. This institutional arrangement is to be reckoned as an important element in the policymaking domain in Mauritius and serves as a good example for countries in the region. Development and Sustainable Growth in Mauritius will definitely contribute to the understanding of the Mauritian economy and serve as a reference for students, policymakers, researchers and any avid reader. I commend the book.”

—Renganaden Padayachy, First Deputy Governor, Bank of Mauritius, Port Louis, Mauritius

“A very comprehensive review and analysis of the development path of the Mauritian economy since Independence. It discusses the economic, social and political transformation of the small island state over the past decades. The book is wide-ranging and helpful for practitioners, students and policy makers.”

—Verena Tandrayen-Ragoobur, Professor, University of Mauritius, Reduit, Mauritius

“This is an invaluable collection of articles on Mauritius evolution which will reso-nate well with scholars and policy makers in international relations and develop-ment economics. The book offers a rare combination of rigorous analysis and empirical investigations by a stellar group of contributors led by Vanessa T. Tang. The book is stimulating, rigorous and thought-provoking.”

—Rodrigo Tavares, Senior Research Fellow, Harvard University, USA, and President, Granito Group and World Economic Forum

Young Global Leader, Brazil

xiii

contents

1 Mauritius: The Making of a Developmental African State 1Vanessa T. Tang, Merle G. Holden, and Timothy M. Shaw

2 Coalitions, Capitalists, and Credibility: Overcoming the Crisis of Confidence at Independence in Mauritius 17Deborah Brautigam and Tania Diolle

3 Trade Openness and Economic Growth in Mauritius 69Vanessa T. Tang, Fiona Tregenna, and Johane Dikgang

4 Zoning in on Mauritius Special Economic Zones: Structure, Evolution and Economic Impact 105Vanessa T. Tang

5 Impact of the Dismantling of the Multi-Fiber Agreement in the Export Processing Zones of Mauritius 119Jaysen Ramasamy

6 Export Sophistication and Bilateral Trade in Mauritius: An Extended Gravity Model Approach 141Vanessa T. Tang

7 The Service Export-Led Growth Hypothesis in Mauritius 171Kobena T. Hanson, Vanessa T. Tang, and Hilary T. Muguto

xiv CONTENTS

8 An Input-Output Analysis of Mauritius’ Economy 183Vanessa T. Tang and Fiona Tregenna

9 Threats to Environmentally Sensitive Areas from Peri- Urban Expansion in Mauritius 213David S. Hammond, Valery Gond, Claudia Baider, Vincent F. B. Florens, Sharveen Persand, and Susan G. W. Laurance

10 Towards Economic Transformation: The Way Forward for Africa 239Joseph Atta-Mensah, Vanessa T. Tang, and Timothy M. Shaw

Index 253

xv

Joseph Atta-Mensah is Principal Policy Adviser in the Capacity Devel-opment Division (CDD) at the United Nations Economic Commission for Africa (UNECA). His research and analysis focuses on regional inte-gration, macroeconomics and central banking. He has published exten-sively and advises governments, the Regional Economic Communities (RECs) and other stakeholders. He has represented UNECA at Summits of African Heads of State, meetings of African Ministers and other high-level conferences within and outside Africa. Before joining UNECA, he worked as a senior economist in the Bank of Canada. He holds a PhD in Financial Economics from Simon Fraser University, British Columbia, Canada.

Claudia Baider is an ecologist, plant taxonomist and conservation scien-tist in charge of the National Herbarium of Mauritius. She holds a PhD from the Universidade de Sao Paulo. She has worked on the conservation of biodiversity in tropical terrestrial systems focusing on the Amazon and the Atlantic forests of Brazil and more recently the Mascarenes within the Madagascar and SW Indian Ocean Biodiversity hotspot where she has been investigating the impact of invasive alien species on the biodiversity of tropical forests. She has co-authored dozens of papers in academic jour-nals and books.

Deborah Brautigam is Bernard L. Schwartz Professor of Political Sci-ence, Director of the China-Africa Research Institute and Director of the International Development Program at the School of Advanced Interna-tional Studies, Johns Hopkins University, Washington, DC, USA.

notes on contributors

xvi NOTES ON CONTRIBUTORS

Johane Dikgang is Director of the Public and Environmental Economics Research Centre (PEERC) in the Department of Economics at the University of Johannesburg. His research interests lie in the area of envi-ronmental valuation, nature-based tourism, energy, water, climate change, agriculture, transport, land reform and environmental fiscal mea-sures. He holds a PhD in Economics from the University of Cape Town and has published extensively in his areas of interest.

Tania  Diolle is a political scientist and politician, a researcher and Lecturer in Political Science. She graduated with an MPA from Sciences Po Paris and is working on public policy and political systems and democracy.

Vincent F. B. Florens is an ecologist and conservation scientist, an asso-ciate professor and former head of the Biosciences Department at the University of Mauritius. He holds a PhD in Ecology and Conservation from the Université de La Réunion. He has co-authored numerous jour-nal articles, book chapters, conference papers and technical reports on the ecology and conservation of endemic flora and fauna on Mauritius and the Mascarene islands.

Valery Gond is a geographer and remote sensing specialist in the Unité Propre de Recherche Biens et Services des Écosystèmes Forestiers Tropicaux: l’Enjeu du Changement Global (BSEF) at CIRAD, Montpellier, France. He has been extensively involved in the determination of human impact on the environment remotely by developing techniques to discriminate par-ticular activities such as mining, logging, agriculture in the complex tropical systems of Amazonia, Central Africa and Indonesia. He has co-authored over a hundred papers in academic journals, books and technical reports.

David S. Hammond is Director at NWFS Consultancy, an international consulting group working in conservation and international development in tropical countries. He holds a PhD from the School of Environmental Sciences at the University of East Anglia. He is editor of Tropical Forest of the Guiana Shield and author of the forthcoming book Tropical Bioproductivity: Origins, Distribution and Role in Globalization. He has published in numerous academic journals on the environmental and eco-nomic consequences of land-use change. He has lived and worked in more than a dozen countries. His work in Mauritius and Rodrigues has focused primarily on environmental impacts, planning and management.

xvii NOTES ON CONTRIBUTORS

Kobena T. Hanson is the co-founder of Strategic Outlooks LLC and a Principal Evaluation Capacity Development Officer with the Independent Development Evaluation (IDEV) Division of the African Development Bank, Abidjan, Côte d’Ivoire. He has widely published on issues of capac-ity development, leadership, natural resource governance, knowledge management, regional development and public policy. He holds a PhD from Queen’s University, Kingston, Ontario, Canada.

Merle G. Holden is Professor Emeritus of Economics at the University of Kwazulu-Natal. She holds a PhD in Economics from Duke University, Durham, North Carolina. Her articles have appeared in international journals in the area of trade and exchange rate policy and more latterly in competition policy. She was President of the Economic Society of South Africa and served on the Competition Tribunal of South Africa.

Susan G. W. Laurance is an associate professor in the Centre of Tropical Environmental and Sustainability Studies at James Cook University, Australia, a former research associate at the Smithsonian Tropical Research Institute and President of the Association for Tropical Biology and Conservation. She holds a PhD from the University of New England, Australia. She studies how human activities impact tropical rainforest plant and wildlife communities with a special interest in how vulnerable wildlife and plant species are affected by major land-use and climate change. Her work spans much of the tropical world, including the Amazon and tropical Australia. She has co-authored more than one hundred journal articles.

Hilary T. Muguto is a PhD candidate in Economics at the University of KwaZulu-Natal and is the recipient of the HEARD PhD scholarship. His research interest is in applied economics and economic development. He is conducting research on HIV/AIDS for HEARD research unit.

Sharveen Persand is an oceanographer and marine environmental con-sultant with Clams Ltd in Mauritius. He holds an MSc in Physical Oceanography from the University of Wales (Bangor). His consulting experience has led him to conduct various projects for governments, NGOs and multi-lateral institutions in the offshore environment of Mauritius and more widely, the Indian Ocean.

Jaysen Ramasamy is First Secretary at the Ministry of Foreign Affairs in Mauritius. Prior to his current position, he has served as First Secretary at the Mauritius Embassy in Washington, DC, the Mauritius High Commis-

xviii NOTES ON CONTRIBUTORS

sion in Pretoria and also in New York and Antananarivo. He holds a PhD in Economics from the University of the Witwatersrand, RSA. His research interest is in international relations and international trade.

Yiagadeesen (Teddy) Samy is Professor of International Affairs and the Director, at the Norman Paterson School of International Affairs, Carleton University, Ottawa, Canada. He holds a PhD in Economics from the University of Ottawa. He has published widely on issues related to inter-national economics and economic development. He recently co-authored the 2015 Africa Capacity Report on Capacity Imperatives for Domestic Resource Mobilization in Africa and a textbook on African Economic Development. His research areas include state fragility, aid effective-ness, domestic resource mobilization and income inequality.

Timothy M. Shaw studied and taught at Makerere University at the end of the 1960s and has been a visiting faculty member at universities of Ife, Rhodes, Stellenbosch, Western Cape, Zambia and Zimbabwe. He recently directed postgraduate institutes in London (Commonwealth Studies) and Trinidad (IR) and was foundation director of a new PhD in Global Governance and Human Security at UMass in Boston. He has recently co-edited African Foreign Policies in International Institutions and Palgrave Handbook of Contemporary International Political Economy.

Vanessa  T.  Tang is Lecturer in International Economics and policy development consultant at the University of KwaZulu-Natal. She holds a PhD in Economics from the University of Johannesburg, RSA. She has consulted for various organizations including most recently the African Development Bank, African Union and African Capacity Building Foundation. She has published numerous papers in books, journals and government reports on issues related to international trade, welfare, tour-ism, special economic zones and regional economic integration. Her most recent co-edited book is titled Comparative Regionalism for Development in the 21st Century: Insights from the Global South.

Fiona Tregenna holds the DST/NRF South African Research Chair in Industrial Development, and is Professor of Economics at the University of Johannesburg. She holds a PhD in Economics from Cambridge University. Her primary research interests lie in structural change, dein-dustrialization and industrial development. She has published internation-ally on poverty, inequality and unemployment. She is an elected member of the Academy of Science of South Africa.

xix

list of acronyms

ACP African, Caribbean and PacificADF Augmented Dickey-FullerAGOA Africa Growth and Opportunity ActARDL Autoregressive Distributed LagAUC African Union CommissionBOPS Balance of Payments StatisticsBRGNP Black River Gorge National ParkBUA built-up areaCAM Comité d’Action MusulmanCEM Club des Étudiants MauricienCFTA Continental Free Trade AreaCM Coastal MarshlandCOMESA Common Market for Eastern and Southern AfricaCPE Conseil de Promotion des ExportationsCPI Consumer Price IndexCSA Commonwealth Sugar AgreementCSO Central Statistics OfficeDBM Development Bank of MauritiusDC Development CertificatesDEM Digital Elevation ModelDSB Defined Settlement BoundariesECA Economic Commission for AfricaEEC European Economic CommunityEPA Economic Partnership AgreementEPZ Export Processing ZoneESA Environmentally Sensitive AreasEU European Union

xx LIST OF ACRONYMS

EXPY Export SophisticationFDI Foreign Direct InvestmentFE Fixed EffectFTA Free Trade AgreementGATS General Agreement on Trade in ServicesGATT General Agreement on Tariffs and TradeGCVC Global Clothing Value ChainGDP Gross Domestic ProductGGDC Groningen Growth and Development CentreGSP Generalised System of PreferencesGWF General Workers FederationHAC Heteroscedasticity and AutocorrelationHD Harrod-Domar modelHDI Human Development IndexHNC High Native ContentH-O Heckscher-Ohlin modelIFB Independent Forward BlocIFS International Financial StatisticsILO International Labour OrganisationIMF International Monetary FundINFRA InfrastructureIO Input-OutputIOC Indian Ocean CommissionIUCN International Union for the Conservation of NatureJEC Joint Economic CouncilKPSS Kwiatkowski–Phillips–Schmidt–ShinLMWHS Le Morne World Heritage SiteMAOTRI Market Access Overall Trade Restrictiveness IndexMCCI Mauritius Chamber of Commerce and IndustryMEDIA Mauritius Export Development and Investment AuthorityMFA Multi-Fiber AgreementMIDP Motor Industry Development ProgrammeMLP Mauritius Labour PartyMMM Mouvement Militant MauricienMOHL Ministry of Housing and LandsMSS Mauritius Sugar SyndicateMUS MauritiusNIC Newly Industrialised CountryOCAM African-Malagasy Common OrganizationOECD Organisation for Economic Cooperation and DevelopmentOLS Ordinary Least SquarePMSD Parti Mauricien Social-Democrate

xxi LIST OF ACRONYMS

PP Phillips-PerronPPP Purchasing Power ParityPS Prebisch-SingerPPML Poisson Pseudo-Maximum Likelihood PTA Preferential Trade AgreementRCA Revealed Comparative AdvantageRE Random EffectREC Regional Economic CommunityREER Real Effective Exchange RateRs RupeesSADC Southern African Development CommunitySAP Structural Adjustment ProgrammeSDG Sustainable Development GoalsSEDUC Secondary EducationSELG Service Export-Led GrowthSEZ Special Economic ZoneSFL State Forest LandSITC Standard International Trade ClassificationSPOT Satellite Pour l’Observation de la TerreSSA Sub-Saharan AfricaTFP Total Factor ProductivityTLIB Trade LiberalisationTOT Terms of TradeTS Trade Share2SLS Two-Stage Least SquaresUK United KingdomUN United NationsUNCOMTRADE United Nations Commodity Trade StatisticsUNCTAD United Nations Conference on Trade and DevelopmentUNDP United Nations Development ProgrammeUNECA United Nations Economic Commission for AfricaUNEP United Nations Environment ProgrammeUNIDO United Nations Industrial Development OrganizationUS United StatesVECM Vector Error Correction ModelVIF Variance Inflation FactorWB World BankWCMC World Conservation Monitoring CentreWDI World Development IndicatorsWTO World Trade OrganizationWTS World Trade Share

xxiii

Fig. 1.1 Mauritius: A diversified economy. Source: Central Statistics Office Mauritius, 2012 and United Nations National Accounts Database, 2012 3

Fig. 3.1 The variability of real gross domestic product of Mauritius. Source: International Monetary Fund-International Financial Statistics 2017 71

Fig. 3.2 The weighted mean tariffs. Source: World Bank World Development Indicators Database 2012 79

Fig. 4.1 Exports share to the industrialised markets and diversification of exports 108

Fig. 4.2 SEZ gender employment contribution 113Fig. 5.1 T&C imports into the US. Source: World Integrated Trade

Solution (WITS): http://wits.worldbank.org/ 128Fig. 5.2 T&C imports in the EU and Asia. Source: World Integrated

Trade Solution (WITS)—http://wits.worldbank.org/ 129Fig. 6.1 Countries’ export sophistication (ln EXPY) 143Fig. 6.2 Time taken to clear exports and imports 148Fig. 7.1 Mauritius service exports 172Fig. 8.1 International comparison of manufacturing value-added output

and employment. Source: Groningen Growth and Development Centre database (GGDC 2014) 189

Fig. 8.2 Decomposition of output growth (1997–2002). Source: Decomposition calculations and compilation based on the National Central Statistics Office Input Output Data, 1997 and 2002 197

list of figures

xxiv LIST OF FIGURES

Fig. 8.3 Decomposition of output growth (2002–2007). Source: Decomposition calculations and compilation based on the National Central Statistics Office Input Output Data, 2002 and 2007 198

Fig. 9.1 Spatial proximity of ESA types on Mauritius in relation to the distribution of BUA, where a distance of zero is within a BUA and values are maximum interval distances 224

Fig. 9.2 Distribution of BUAs on Mauritius in relation to elevation above sea level 229

xxv

list of tables

Table 2.1 Governance indicators: top ten developing countries (average over the period 1996–2015) 19

Table 2.2 Government of national unity cabinet, December 1, 1969 63Table 2.3 Key coalition stakeholders attending secondary school at

Royal College 64Table 2.4 Timeline 65Table 3.1 Mauritius effective protection 78Table 3.2 The major exports of SSA clothing and textile economies 81Table 3.3 Trade openness results based on six models—OLS—

dependent variable (REAL GDP) 87Table 3.4 Trade openness results based on six models—2SLS—

dependent variable (real GDP) 88Table 3.5 Cointegration results 93Table 3.6 VECM results 93Table 3.7 Annual data description and sources 95Table 3.8 Diagnostic tests: 2SLS results 96Table 3.9 Diagnostic tests: OLS results 97Table 3.10 Unit root results 98Table 4.1 SEZs main economic indicators, 1971–2010 111Table 5.1 Progress of quota removal under the ATC 127Table 5.2 DID estimates of the effect of preferences on employment 130Table 5.3 DID estimates of the effect of preferences on exports 131Table 5.4 DID estimates for treatment group 133Table 5.5 DID estimates for treatment group post 2004 (after removal

of preferences) 134

xxvi LIST OF TABLES

Table 6.1 Mauritius high-technology manufactures (1990–2013) 149Table 6.2 Bilateral Export Model-Random Effect (RE), Fixed Effect

(FE) and Poisson Pseudo-Maximum Likelihood (PPML) 157Table 6.3 List of countries: Key export partners 162Table 6.4 Data description and sources 163Table 6.5 Unit root results 164Table 6.6 Correlation results 165Table 7.1 The autoregressive distributed lag (ARDL) results 179Table 7.2 Granger causality results 180Table 8.1 Sectoral value-added output in Mauritius 186Table 8.2 Sectoral value-added employment in Mauritius 186Table 8.3 Schematic illustration of input-output matrix 190Table 8.4 Backward and forward linkages in production and

employment 202Table 8.5 Summary of results from growth decomposition 203Table 8.6 List of economic sectors: Sectoral description 205Table 8.7 Output backward and forward linkages 206Table 8.8 Labour backward and forward linkages 208Table 8.9 Normalised indices output backward and forward linkages 210Table 8.10 Normalised indices labour backward and forward linkages 211Table 9.1 ESA-type coverage arranged by ascending mean elevation 217Table 9.2 Proportion of land and lagoon area under various public and

private land designation categories 219Table 9.3 Results of statistical tests of spatial relationship between

land/marine designation and ESA occurrence 226Table 9.4 Results of statistical tests of spatial relationship between

marine designation and ESA occurrence 228