An International Monetary Fund (IMF) technical assistance report said public finances deteriorated sharply following the COVID-19 pandemic despite decades of strong economic development, sound institutions and prudent macroeconomic management.
Public-sector debt stood at 88.5% of gross domestic product at the end of the 2024/25 financial year, while the central government’s budget deficit widened to nearly 9.3%. “Budget deficits have greatly surpassed planned deficits every year since the pandemic,” the IMF said.
The Mauritian government has committed to introducing Fiscal Responsibility Legislation aimed at strengthening debt sustainability, transparency and fiscal discipline.
An IMF Fiscal Affairs Department team visited Port Louis from February 11 to February 24, 2026, to assess the existing framework and advise on the proposed legislation.
Mauritius already has a statutory debt anchor, a medium-term fiscal framework and improving public finance statistics. However, the measures have not effectively enforced fiscal discipline and accountability.
The statutory debt ceiling was set at 60% of gross domestic product when introduced in 2008. Repeated breaches led to the limit being raised to 80% in 2024, but debt subsequently exceeded the revised ceiling.
The IMF identified optimistic economic and fiscal forecasts as another weakness, with substantial differences between budget projections and actual outcomes.
Limited reporting during the financial year and the absence of an early strategic budgeting phase have also weakened accountability.
The report warned that Mauritius remained vulnerable as a small, open island economy dependent on tourism, financial services and global economic conditions.
Climate-related shocks, state-owned enterprises, special funds, extra-budgetary entities and contingent liabilities could further undermine public finances.
The IMF recommended clearly defined fiscal rules, narrow escape clauses for exceptional circumstances and mandatory corrective action when targets were missed.
Independent monitoring of compliance should also be introduced, while the government should publish quarterly budget execution reports and a mid-year budget review.
Oversight of state-owned enterprises and other public bodies must be strengthened through improved governance, reporting and risk management.
The IMF said reforms should be phased realistically because the Finance Ministry had strong expertise but limited staffing capacity.
–IMF/ChannelAfrica–
