Budget Speech 2024 / 25

 In Articles

With the general elections due this year, stakeholders held their breath waiting for the Honourable Dr Renganaden Padayachy, Minister of Finance, Economic Planning and Development to deliver his last budget speech of this current government’s tenure.

After the pandemic years and their aftermath, the Hon. Minister of Finance had more flexibility for this year’s budget, with most economic indicators in the green.  According to estimates of Statistics Mauritius, all sectors of the economy except the sugarcane industry have registered positive growth rates in 2023. The 2024 IMF Article IV Consultation published on 28 May 2024 also highlighted the country’s strong rebound from the pandemic and predicted that Mauritius would be a MUR 1 trillion economy by 2030.  In addition, the global growth, which has been revised upwards to 3.1% for 2024, and the receding global inflation rate are expected to have positive impacts on the local economy.

With this backdrop, the Hon. Minister of Finance presented on 7 June 2024 a social Budget with a wave of measures to strengthen the electoral support to the present government. Themed as ‘’Tomorrow is Ours’’, this Budget is a continuation of the previous year’s budget, with an intensification of social measures targeting the neediest and the implementation of a further increase in minimum wage to MUR 20,000 as from next month.  The generous measures announced by the Hon. Minister of Finance will unfortunately become a burden on the welfare state and will need to be borne over the years by a shrinking working population arising from ageing, increasing emigration and lower birth rate.

As a small insular developing state, Mauritius requires appropriate climate change planning, mitigation, adaptation, and resilience. The budget rightly attempts to address certain persistent threats linked with climate change by earmarking various initiatives such as coral reef and coastlines restorations. To fund these initiatives, the Hon. Minister of Finance announced the future introduction of a corporate climate responsibility levy of 2% on profits of companies whose turnover exceed MUR 50 million. It remains to be confirmed if the levy will also be applicable to companies operating in the Global Business sector.

The main measures of this year’s national budget have been highlighted in this brief for your good reading.