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Annual Report 2006-07 Contents

Contents

Page Letter of Transmittal5 Statement from the Governor

9 1. Review of the Economy: 2006-07

13 I National Income and Production

13 Output14 Income14 Expenditure on GDP16 Agriculture17 Manufacturing18 Tourism19 Financial Intermediation 19 Real Estate, Renting and Business Activities19 Other Sectors

20 II Labour Market and Price Developments

20 Wage Developments22 Labour Force, Employment and Unemployment23 Unit Labour Cost and Productivity25 Prices26 Core Inflation27 Producer Prices

28 III Money and Banking

28 Monetary Policy: 2006-0732 Depository Corporations Survey38 Banking Sector41 Interest Rates44 Other Financial Corporations45 Capital Market Developments

48 IV Government Finance

48 Revenue and Grants49 Expenditure and Lending minus Repayments52 Budgetary Operations and Financing of the Deficit52 Public Debt

56 V External Trade and Balance of Payments

56 Services, Income and Current Transfers56 Capital and Financial Account59 Net International Reserves 59 Exchange Rate Developments

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Contents Annual Report 2006-07

Page 69 VI Regional Cooperation

69 Southern African Development Community (SADC)72 Common Market for Eastern and Southern Africa (COMESA)

74 2. Regulation and Supervision

75 Legislative Changes and Regulations83 Performance of the Banking Sector 86 Non-Bank Financial Institutions

87 3. Financial Market Developments

87 Money Market Activity95 Foreign Exchange Market 99 Public Debt Management

101 4. Accounting, Budgeting and Payment System

103 Payment System108 Banking and Currency Division

111 5. Administration and Staff Matters

111 Conferences, Seminars, Training Courses and Overseas Missions114 Human Resource Matters

117 6. Audit Committee Report

119 7. Financial Statements

121 Report of the Auditors123 Audited Financial Statements

Boxes

29 Box I: Note on the Change in Methodology in Monetary Statistics58 Box II: The IMF's 2005 Coordinated Portfolio Investment Survey (CPIS)66 Box III: IMF: Public Information Notice

List of ChartsList of Tables

Appendix I Statistical TablesAppendix II Board of Directors as at 30 June 2007Appendix III Monetary Policy CommitteeAppendix IV Senior Management OfficialsAppendix V Organisation ChartAppendix VI List of Authorised Banks, Non-Bank Deposit-Taking Institutions,

Money-Changers and Foreign Exchange Dealers

3

Annual Report 2006-07 Letter of Transmittal

The Governor Bank of Mauritius Port Louis

18 August 2008

The Honourable Rama Krishna Sithanen,Deputy Prime Minister, Minister of Finance

and Economic Development,Government House,Port Louis.

Dear Deputy Prime Minister, Minister of Finance and Economic Development

Annual Report and Audited Accounts 2006-07

In accordance with the provision of Section 32 (3) of the Bank of Mauritius Act 2004, I transmit herewith the fortieth Annual Report of the Bank, which also contains the audited Accounts of theBank for the year ended 30 June 2007.

Yours sincerely

Rundheersing Bheenick

5

Annual Report 2006-07 Statement from the Governor

It is a long established tradition of the Bank of Mauritius Annual Report that

the Governor comments on the state of the economy and on the monetary and

financial developments over the past year. As a newly-minted Governor, I would

also wish to share with you my reflections and my vision for the Bank of Mauritius

and touch upon some of the challenges facing the Bank in the coming year.

The global economy experienced unprecedented deceleration as a result of

the financial turmoil which occurred in the wake of the sub-prime mortgage

market crisis in the United States. Major economies experienced a reduction in the

expected growth rates due to their direct linkages with the turmoil while emerging economies suffered to a

lesser extent and continued to face robust growth rates. These countries continued their progressive

integration in the global economy with improved productivity levels and encouraging growth rates.

Mauritius remained shielded against the global imbalances due to the relatively small exposure of the

domestic economy to the major markets. Domestic activity rebounded in 2006/07 mainly on account of the

performance of the tourism, construction, financial intermediation and manufacturing sectors. The decline

in the budget deficit to GDP ratio to 4.3 per cent reflects the consolidation efforts of the Government.

Increased capital inflows mainly driven by the Integrated Resort Schemes led to higher surplus in the

balance of payments in 2006/07 while the net foreign assets of both the central bank and other depository

corporations resulted in higher net international reserves and import cover.

The Bank of Mauritius is celebrating this year its 40th anniversary and this milestone in the history of

the Bank coincides with a gleaming new and tall superstructure with, at the apex, a new Governor with a new

vision for a new Bank of Mauritius.

The Bank of Mauritius Act 2004 confers upon me the general supervision of the Bank and in carrying

out this responsibility, I delegate powers to my two Deputy Governors to fulfil the Bank’s mandate of

maintaining price stability and achieving financial stability.

My first concrete action as new Governor was to formally establish the Monetary Policy Committee

(MPC), as laid down in the Bank of Mauritius Act 2004. The MPC was officially launched on 23 April 2007.

In addition to the Governor and the two Deputy Governors who represent the Bank in an institutional

capacity, the MPC also has two board members and three external members appointed by the Minister of

Finance and Economic Development. The MPC also greatly benefits from the rich experience of Mario Blejer

and Stephan Gerlach, two highly respected academics of international repute.

The law, as it then stood, required the MPC to submit its recommendations to the Board of Directors

for determination of the monetary policy stance. My next objective was to seek greater independence for

the MPC and I am pleased to say that in August 2007, the enabling Act was amended to empower the MPC

to formulate and determine the monetary policy of the Bank. The law further stipulates that the MPC shall

not be subject to the direction or control of any other person or authority. In my statement for the 2007/08

Statement from the Governor

Annual Report, with the benefit of hindsight, I will review how well the MPC has delivered on its prime

mandate of maintaining price stability.

The establishment of the MPC has kick-started the overall restructuring exercise of the Bank which I

felt was required to steer the Bank into the new era of financial innovation. My new vision for the Bank was

a modern, lean, efficient and performing machine which the staff and the country would be proud of.

I have a number of projects at heart to underscore the Bank’s corporate social responsibility:

• a world class bamboo garden which the Bank would donate to the nation in an endeavour to bring

our contribution to a greener Mauritius;

• a financial literacy and outreach programme to bring us closer to the nation and educate our people

on banking and financial matters;

• memorial lectures to be delivered by eminent personalities from the central banking arena;

• a national essay competition and a monetary policy challenge to raise the interest of our youth in

financial education;

• spearheading the development of the financial landscape of Rodrigues and setting up a new

building; and

• launching a national banknote competition to encourage the participation of our local artists in the

design of the new family of banknotes to be issued in 2008.

Upon the commencement of business of our new banking counters at the Bank of Mauritius Tower, I

also intend to re-open our doors to the sale of the OTC security bills and bonds in an effort to enhance

market liquidity, improve the price discovery process and develop a more effective transmission of policy

decisions.

On the regulatory and supervisory front, I intend to set up a framework for the conduct of Islamic

banking and, why not, invite promoters to set up Islamic banks in Mauritius. I am also committed to

implement rather rapidly the new capital adequacy framework (Basel II), which will undoubtedly bring

continued improvements to the risk management systems of banks thereby strengthening the soundness

of the banking sector.

I take this opportunity to announce that the Bank’s publications will soon be enriched with two useful

additions, the Financial Stability Report and the Inflation Report. The Financial Stability Report will

introduce an index for the Mauritius exchange rate and the Inflation Report will elaborate on the concept of

neutral real interest rate.

I also wish to foster closer collaboration with our sister regulatory institution, the Financial Services

Commission, to enhance the stability of our financial system. In that respect, we will be signing a Protocole

D’Accord. I have also started to meet stakeholders of the real sector and I have in mind to hold regular

meetings in the future as we need to weigh real sector issues more adequately in our policy decisions.

Statement from the Governor Annual Report 2006-07

6

Annual Report 2006-07 Statement from the Governor

7

We have gone regional with the hosting of the 6th Meeting of Governors of the Eastern Africa sub-

Regional Committee of the Association of African Central Banks (AACB) in May 2007 and on that occasion

the chairmanship of the Committee was passed on to the Bank for one year.

The projects I have on the drawing board may seem ambitious but I realise that innovation is the name

of the game if we wish to successfully adapt to changes in the global financial environment. We cannot

afford to be complacent about our achievements, we need continuous rethinking to ensure continuity in a

world where, it is said in common parlance, the only constant is change.

In any case, we need to constantly remind ourselves that our prime objective is to maintain price

stability and to promote orderly and balanced economic development.

Lately, inflationary pressures have been building up in the global economy and we expect the inflation

rate to cross the single digit figure in the coming months. The high rate of inflation is a cause for concern

and we would be called upon to harness all our resources to combat inflation and safeguard the value of

our currency. Furthermore, although the exposure of Mauritius to the burgeoning sub-prime market crisis

is minimal, we need to be on our guard to ward off any undesirable effects.

I am extremely pleased and thankful to Mario Blejer and Stephan Gerlach for their presence on the

MPC. I am looking forward to a very enriching working relationship with them.

I also extend a special note of thanks to the Bank Negara Malaysia for their invaluable support in the

restructuring exercise of the Bank.

Finally, I trust the Bank staff will continue to show commitment and loyalty on our way to the

modernisation of the institution. I count on their support to achieve the Bank’s mission in the best and most

efficient way possible.

Rundheersing Bheenick

9

Annual Report 2006-07 Review of the Economy: 2006-07

1 Review of the Economy: 2006-07

Economic performance improved during fiscalyear 2006-07 with a real GDP growth rate of 5.1per cent, a decrease in the budget deficit as aproportion of GDP to 4.3 per cent from 5.3 per centin 2005-06, a decrease in the unemployment rate,a deficit on the current account balance but anoverall balance of payments surplus. Netinternational reserves increased, reflectingessentially the rise in the net foreign assets of thecentral bank and other depository corporations. Onthe external front, the current account of thebalance of payments posted a higher deficit,attributable mainly to the worsening in themerchandise account, largely on account of thepurchase of two aircrafts. Consumer price inflationincreased from 5.1 per cent in 2005-06 to a double-digit figure of 10.7 per cent in 2006-07. Net creditto government contracted by 13.0 per cent. BroadMoney Liabilities (BML) grew by 8.6 per centcompared to the rise of 6.7 per cent registered inthe preceding fiscal year as a result of increases inboth domestic claims and net foreign assets ofdepository corporations.

Gross Domestic Product (GDP) at basic pricesincreased by 12.0 per cent in nominal terms, fromRs162,171 million in 2005 to Rs181,968 million in2006. In real terms, the economy grew by a higherrate of 5.0 per cent in 2006 compared to 2.3 percent in 2005. In contrast to the negative growthrates recorded in 2005, the agricultural, textile andconstruction sectors registered positive growthrates in 2006.

The agricultural sector registered a positivegrowth of 0.6 per cent in 2006, mainly as a resultof a growth of 4.5 per cent in the non-sugaragricultural sector, partly offset by a fall in sugarproduction to 504,857 tonnes. The“Manufacturing” sector grew, in real terms, by 4.0per cent in 2006. The EPZ sector registered agrowth of 4.6 per cent in 2006 after four years ofnegative growths, with exports totalling Rs33,249million in 2006. The tourism sector grew by 3.5 percent in 2006, down from growth of 5.6 per cent in2005 mainly as a result of the cancellation of hotelreservations by tourists as a result of the spread ofthe “Chikungunya” disease. Tourist arrivals

increased from 761,063 in 2005 to 788,276 in2006. Gross tourism earnings increased by 24.3per cent, from Rs25,704 million in 2005 toRs31,942 million in 2006, compared to a growth of9.6 per cent in 2005. The ‘Construction’ sectorrebounded by 5.2 per cent in 2006, after a declineof 4.4 per cent the previous year, mainly as a resultof the construction and renovation of hotels and theimplementation of Integrated Resort Schemeprojects. The “Financial Intermediation” sectorgrew by 7.0 per cent in 2006, higher than the 5.4per cent growth in 2005.

In nominal terms, aggregate consumptionexpenditure increased by 13.0 per cent toRs174,846 million in 2006. In real terms, itregistered a growth of 5.5 per cent in 2006compared to 7.1 per cent in 2005. Gross NationalSavings (GNS) increased by 9.8 per cent toRs35,343 million in 2006. The savings rate,defined as the ratio of GNS to GDP at marketprices, fell from 17.4 per cent in 2005 to 17.1 percent in 2006.

Gross Domestic Fixed Capital Formation(GDFCF), exclusive of the acquisition of aircraft,grew, in real terms, by 5.5 per cent in 2006 incontrast to a decline of 1.6 per cent in 2005.The ratio of GDFCF to GDP at market pricesincreased from 21.4 per cent in 2005 to 24.3 percent in 2006.

The population of the Republic of Mauritius,including Agalega and St Brandon, was estimatedat 1,256,727 as at 31 December 2006.

According to the “Continuous Multi-PurposeHousehold Survey”, the total labour force stood at565,100 in 2006 with a growth of 0.3 per cent inthe male labour force and 2.5 per cent in thefemale labour force. The number of foreignworkers increased from 16,600 in 2005 to 16,700in 2006. The total number of persons inemployment, inclusive of foreign workers,increased by 1.6 per cent to 515,300 in 2006, withmale employment at 340,500 and femaleemployment at 174,800. The unemployment ratereached 9.1 per cent in 2006 from 9.6 per centin 2005.

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Review of the Economy: 2006-07 Annual Report 2006-07

The rate of consumer price inflation rose from5.1 per cent in 2005-06 to a double-digit figure of10.7 per cent in 2006-07. This was to a largeextent attributable to budgetary measures, thepass-through of the exchange rate depreciation todomestic prices, the increase in freight rates, highenergy prices and adverse climatic conditions incertain exporting countries leading to a hike inprices of food commodities notably.

International oil prices on the internationalmarket were more or less subdued during fiscalyear 2006-07. The average price per barrel ofNYMEX WTI (West Texas Intermediate benchmarkcrude oil) dropped slightly by 1.4 per cent toUS$63.5 in 2006-07 while the average price perbarrel of IPE Brent futures rose by 2.2 per cent toUS$64.6 in 2006-07. This has been reflected tosome extent on domestic oil prices under theAutomatic Price Mechanism. The price of mogaswas raised by 20.0 per cent in July 2006 andfurther by 8.10 per cent in October 2006 but wasbrought down by 19.95 per cent in January 2007.It remained unchanged following the APM meetingin April 2007. The price of diesel oil rose by 14.91per cent in July 2006 but registered decreases of7.79 per cent and 12.25 per cent in October 2006and January 2007, respectively. It was again hikedby 6.98 per cent in April 2007.

Between end June 2006 and 18 December2006, against a background of rising inflation, aworsening external sector outlook coupled withmonetary expansion, the Bank adopted a tightermonetary policy stance and the Lombard Rate wasraised by a total of 150 basis points: by 50 basispoints from 11.50 per cent per annum to 12.00 percent per annum on 10 July 2006 and a further 100basis points to 13.00 per cent per annum on 11September 2006.

On 18 December 2006, the Bank of Mauritiusintroduced a new framework for the conduct ofmonetary policy, with the Repo Rate replacing theLombard Rate as the key policy rate to signalchanges in its monetary policy stance. Changes tothe operational framework were also effected witha corridor of ±50 basis points established toeffectively provide a ceiling and a floor forovernight interbank interest rates. The Repo Ratewas set at 8.50 per cent per annum on 18December 2006, and no change was brought to theRepo Rate during the rest of fiscal year 2006-07. AStanding Facility without any borrowing quota andthrough which the Bank provides a collateralised

overnight facility to banks was also introduced inreplacement of the Lombard Facility. The rate ofinterest chargeable on the Standing Facility was setat 400 basis points above the Repo Rate.

The Bank discontinued the compilation of theMonetary Survey and shifted the focus to theDepository Corporations Survey (DCS) as the onlyframework for compiling, analysing anddisseminating monetary statistics based on therecommendations of the Monetary and FinancialStatistics Manual. The DCS consolidates theactivities of the Bank of Mauritius and otherdepository corporations, which comprise banks andnon-bank deposit taking institutions.

Broad Money Liabilities grew by 8.6 per centin 2006-07, higher than the growth of 6.7 per centin the preceding fiscal year. Net foreign assets ofdepository corporations grew by 29.5 per cent in2006-07 in contrast to a fall of 1.0 per centregistered in the previous year as the net foreignassets of both the Bank and other depositorycorporations increased. Domestic claims recorded alower growth of 6.0 per cent in 2006-07 comparedto 15.1 per cent in 2005-06 driven by claims onother sectors, which expanded by 12.1 per cent in2006-07 as against a rise of 16.9 per cent in thepreceding fiscal year. Net credit to governmentcontracted by 13.0 per cent, in contrast to anincrease of 10.0 per cent in 2005-06.

The budget deficit for 2006-07 amounted toRs9,439 million, higher than the original estimateof Rs8,553 million but down from Rs10,345 millionin the previous year. As a percentage of GDP atmarket prices, the budget deficit stood at 4.3 percent, higher than the initial budgetary estimate of4.0 per cent. The deficit was financed from externalsources and the non-bank sector. Domesticfinancing came exclusively from the non-banksector with a contribution of Rs10,897 million.Financing from the central bank and banks werenegative at Rs2,043 million and Rs3,773 million,respectively. Net foreign financing surged toRs4,465 million, reflecting a significant increase inboth external loans received and foreigninvestment in Government securities. Total publicdebt increased by 7.7 per cent, from Rs113,364million at the end of June 2006 to Rs122,120million at the end of June 2007. As a percentage ofGDP at market prices, total public debt fell from57.9 per cent at the end of June 2006 to 55.7 percent at the end of June 2007.

11

Annual Report 2006-07 Review of the Economy: 2006-07

Exchange rate movements during the periodunder review reflected the combined effects ofinternational trends and local market conditions.Between the 12-month period ended June 2006 andthe 12-month period ended June 2007, the rupee,on an average basis, depreciated against the Poundsterling, euro, US dollar and Japanese yen by 14.3per cent, 13.3 per cent, 6.3 per cent and 4.4 percent, respectively but appreciated by 4.6 per centagainst the South African rand. Reflecting liquidityconditions in the domestic foreign exchangemarket, the Bank of Mauritius sold US$169.4 millionon the market during the period July 2006 to mid-February 2007 before purchasing US$252.8 millionat a later stage during the fiscal year.

The current account of the balance ofpayments deteriorated significantly to record ahigher deficit of Rs17,469 million in 2006-07compared with Rs10,188 million registered in2005-06. The deficit on the current accountrepresented 8.0 per cent in 2006-07 compared to5.2 per cent in 2005-06. The deterioration largelyreflected the worsening in the merchandiseaccount, largely on account of the purchase of twoaircrafts, which was to a certain extent offset bycombined surpluses on the services, income andcurrent transfers accounts. Total exports (f.o.b.)increased by 5.5 per cent to Rs72,755 million in2006-07 while total imports (f.o.b.) increased by17.3 per cent to Rs110,828 million in 2006-07. Thecapital and financial account, inclusive of reserveassets, recorded net inflows of Rs5,988 million in2006-07 compared to net inflows of Rs4,141 millionin 2005-06.

Net international reserves of the country,comprising the net foreign assets of depositorycorporations, foreign assets of Government andMauritius’ Reserve position in the InternationalMonetary Fund (IMF), increased from Rs64,740million at the end of June 2006 to Rs83,499 millionat the end of June 2007. Net international reservesrepresented around 8.5 months of imports at theend of June 2007 compared to 7.1 months ofimports at the end of June 2006.

During the course of 2006-07, Governmentimplemented a smoothing process to determine thenominal issues of Treasury Bills so that they werespread out more evenly. In addition, with a view toproviding better information to the market, theBank of Mauritius announced a range of TreasuryBills issues for the following month.

In October 2006, central banks andsupervisory agencies have endorsed the new BaselCore Principles for Effective Banking Supervisionand its Methodology at the InternationalConference of Banking Supervisors held in Mexico.The core principles, which are universally acceptedminimum standards for banking regulation andsupervision, were revised on account of significantimprovements, developments and innovations inthe operations and approaches used by financialinstitutions and supervisors worldwide. The Bank isfully dedicated to implementing the 25 coreprinciples and it is constantly improving itsprocesses and upgrading its resources to secure asound and stable financial system. The Bankencourages constructive working relationships at alltimes with financial institutions under its purviewtogether with external auditors. Along the sameline, it continues to reinforce its relationship withsupervisors worldwide through regular informationsharing and mutual agreements. As part of theFinancial Sector Assessment Program, theInternational Monetary Fund and the World Bank,conducted their assessment of compliance to the25 Core Principles in February 2007 to assess theBank’s strengths and weaknesses in its supervisorysystems and methods, and to identify areasfor improvement.

The Bank of Mauritius has adopted aparticipative approach to Basel II implementationand eight Working Groups, comprisingrepresentatives of the Bank of Mauritius as well asbanks, have been set up to discuss and devisepolicy framework in the form of proposal papers onrelevant aspects of Basel II. The implementation ofBasel II is expected to be realized by 2008.

Banks are required to maintain a minimumcapital adequacy ratio of 10.0 per cent. As at end-June 2007, the whole banking sector reported riskweighted capital adequacy ratios averaging 14.4per cent, well above the prescribed minimum. Theoverall risk weighted capital adequacy ratio forcredit risk maintained by banks declined from 17.0per cent as at end-June 2006 to 15.5 per cent as atend-June 2007. During 2006-07, the bankingsector maintained strong financial performance.The aggregate pre-tax profits of banks for the yearunder review went up by Rs2,032 million, or 25.8per cent, from Rs7,890 million in 2005-06 toRs9,922 million in 2006-07.

Regarding its financial performance, it may benoted that the Bank of Mauritius realised a higher

12

Review of the Economy: 2006-07 Annual Report 2006-07

profit of Rs1,763.3 million for the year ended 30June 2007 compared to Rs906.1 million in 2006,reflecting mainly higher interest earned on foreigninvestments.

The foregoing economic and financialdevelopments during the year 2006-07 arereviewed in greater detail in the following chaptersof the report.

13

Annual Report 2006-07 National Income and Production

OUTPUT

Gross Domestic Product (GDP) at basic pricesincreased by 12.2 per cent in nominal terms, fromRs162,171 million in 2005 to Rs181,968 million in2006. In real terms, the economy grew by a rateof 5.0 per cent in 2006, up from 2.3 per cent in2005. Exclusive of sugar, the growth rate of theeconomy was 5.4 per cent compared to 2.8 percent in 2005. In contrast to the negative growthrates recorded in 2005, the agricultural, textile andconstruction sectors registered positive growthrates in 2006, which contributed to the highergrowth rate of the economy. In 2006, the‘Financial intermediation’ sector recorded a higherreal growth rate while the ‘Hotels and restaurants’

sector registered a lower real growth rate than in2005 due essentially to the outbreak of the“Chikungunya” disease.

GDP at market prices went up by 11.3 percent, from Rs185,348 million in 2005 to Rs206,287million in 2006. Taxes on products amounted toRs24,319 million compared to Rs23,177 million in2005. Gross National Income (GNI) at currentmarket prices reached Rs207,920 million, up by12.3 per cent compared to 2005. Per capita GNI atcurrent market prices increased by 11.5 per cent,from Rs148,857 in 2005 to Rs165,939 in 2006. Percapita GDP at current market prices rose by 10.5per cent, from Rs149,049 in 2005 to Rs164,636in 2006.

Table I.1 shows the main national accountingaggregates and ratios for the years 2004 through2007. Chart I.1 shows per capita GNI at marketprices and real growth rate of GDP for the years1999 through 2006.

I. NATIONAL INCOME ANDPRODUCTION

A. Aggregates (Rs million)

1. GDP at basic prices 152,425 162,171 181,968 206,934

Annual Real Growth Rate (Per cent) +4.8 +2.3 +5.0 +5.4

2. GDP at market prices 175,597 185,348 206,287 235,483

3. GNI at market prices 175,207 185,109 207,920 242,974

4. Per capita GNI at market prices (Rupees) 142,020 148,857 165,939 192,774

5. Aggregate Consumption Expenditure 136,880 154,717 174,846 196,533

6. Compensation of Employees 64,378 68,877 74,572 83,715

7. Gross Domestic Fixed Capital Formation 38,003 39,731 50,048 59,170

8. Gross Capital Formation 42,882 41,758 54,742 62,631

9. Gross Domestic Savings 38,717 30,392 33,074 46,441

10. Resource Balance ( 9 - 8 ) -4,165 -11,366 -21,668 -16,190

11. Gross National Disposable Income 176,581 186,906 210,189 246,667

B. Ratios: As a Percentage of GDP at market prices

1. Gross Domestic Savings 22.0 16.4 16.0 19.7

2. Aggregate Consumption Expenditure 78.0 83.5 84.7 83.5

3. Gross Domestic Fixed Capital Formation 21.6 21.4 24.3 25.1

4. Resource Balance -2.4 -6.1 -10.5 -6.9

C. Ratio: As a Percentage of GDP at basic prices

1. Compensation of Employees 42.2 42.5 41.0 40.5

Table I.1: Main National Accounting Aggregates and Ratios: 2004 - 2007

2004 2005 2006 1

2007 1

1 Revised estimates.Source: Central Statistics Office, Government of Mauritius.

14

National Income and Production Annual Report 2006-07

INCOME

Compensation of employees grew by 8.3 percent, from Rs68,877 million in 2005 to Rs74,572million in 2006. As a percentage of GDP at basicprices, it stood at 41.0 per cent, down from 42.5per cent in 2005.

Taxes (net of subsidies) on production andimports rose by 5.2 per cent, from Rs24,781million in 2005 to Rs26,061 million in 2006.Taxes on products increased by 5.0 per cent toRs25,255 million.

Gross operating surplus, which is the excessof gross output over the sum of intermediateconsumption, compensation of employees and nettaxes on production and imports, went up by 15.2per cent to Rs105,654 million in 2006.

Net primary income from the rest of the worldincreased by Rs1,872 million, from a negativefigure of Rs239 million in 2005 to a positive figureof Rs1,633 million in 2006. Net transfer from therest of the world rose by 26.3 per cent to Rs2,269million in 2006.

Gross National Disposable Income (GNDI)grew, in nominal terms, by 12.5 per cent, toRs210,189 million in 2006, compared to a growthof 5.8 per cent in 2005.

Gross National Savings (GNS), which is thatpart of GNDI that is not spent on consumption,increased by 9.8 per cent, from Rs32,189 million in2005 to Rs35,343 million in 2006. The ratio of GNSto GDP at market prices fell from 17.4 per cent in2005 to 17.1 per cent in 2006.

EXPENDITURE ON GDP

Final Consumption Expenditure

Aggregate final consumption expenditure ofhouseholds and General Government went up by13.0 per cent to Rs174,846 million in 2006. In realterms, it grew by 5.5 per cent in 2006 compared to7.1 per cent in 2005. Household consumptionexpenditure grew, in real terms, by 5.9 per cent in2006 compared to 7.3 per cent in 2005. Generalgovernment consumption expenditure recorded areal growth rate of 3.8 per cent in 2006 comparedto 6.1 per cent in 2005. As a percentage of GDP atmarket prices, aggregate final consumptionexpenditure rose from 83.5 per cent in 2005 to84.7 per cent in 2006. Household finalconsumption expenditure as a percentage of GDPat market prices went up from 68.7 per cent in2005 to 70.5 per cent in 2006 while the ratio ofGeneral government final consumption expenditureto GDP at market prices declined from 14.8 percent to 14.2 per cent over the same period.

Gross Domestic Fixed CapitalFormation (GDFCF)

GDFCF went up by 26.0 per cent to Rs50,048million in 2006. In real terms, it expanded by 19.0per cent in 2006 after a contraction of 1.9 per centin the previous year. As a percentage of GDP atmarket prices, the Resource Balance (defined asSavings minus Investment) fell from a negativefigure of 6.1 per cent in 2005 to a negative figureof 10.5 per cent in 2006. GDFCF, exclusive of thepurchase of aircraft, grew, in real terms, by 5.5 percent in 2006 in contrast to a decline of 1.6 per centin 2005. The ratio of GDFCF to GDP at marketprices increased from 21.4 per cent in 2005 to 24.3per cent in 2006.

Private sector GDFCF expanded by 22.2 percent, from Rs27,973 million in 2005 to Rs34,177million in 2006. In real terms, private sector GDFCFgrew by 15.1 per cent in 2006 after contracting by0.3 per cent in 2005, mainly due to substantialinvestment in hotels and IRS projects.

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

1999 2000 2001 2002 2003 2004 2005 2006

Per capita GNI

(Rs)

0.0

2.0

4.0

6.0

8.0

10.0

12.0

Real Growth

Rate of GDP (%)

Per capita GNI Growth Rate

Chart I.1: Per capita GNI and Growth Rate: 1999 - 2006

Source: Central Statistics Office, Government of Mauritius.

15


Public sector GDFCF increased by 35.0 per cent,in nominal terms, from Rs11,758 million in 2005 toRs15,871 million in 2006. In real terms, public sectorGDFCF expanded by 28.3 per cent in 2006 as againsta negative growth of 5.4 per cent in 2005. Thispositive growth was mostly attributable to highinvestment in aircraft, offset to some extent by lowerinvestment in machinery and equipment by somepublic enterprises. However, excluding the acquisitionand sale of aircraft, public sector investmentdeclined, in real terms, by 17.5 per cent in 2006compared to a negative growth of 3.6 per cent in theprevious year. The share of private sector GDFCF intotal GDFCF dropped to 68.3 per cent in 2006 from70.4 per cent in 2005 while that of the public sectorrose to 31.7 per cent from 29.6 per cent in 2005.

Inventories, which include the value of thephysical change in inventories of raw materials,work in progress and finished goods held byproducers, went up from Rs2,027 million in 2005 toRs4,694 million in 2006.

Tables I.2 and I.3 show the real growth ratesof GDFCF by type of capital goods and by industrialuse, respectively, for the years 2004 through 2006.Chart I.2 depicts the movements in the ratios ofGDFCF and GNS to GDP at market prices for theyears 1999 through 2006. Chart I.3 showsinvestment by sector in 2006 and Chart I.4 depictsthe growth rates of public and private sector GDFCFfor the years 1999 through 2006.

A. Building and Construction Work -0.3 -5.3 +6.7

Residential Building -2.3 -10.5 +10.3

Non-residential Building +20.1 -12.1 +3.9

Other Construction Work -24.2 +16.8 +6.3

B. Machinery and Equipment +6.2 +3.4 +36.9

Machinery and Equipment (excluding aircraft & marine vessel) +13.4 +4.2 +3.8

Passenger Car +39.5 -14.1 +4.2

Other Transport Equipment -40.3 +2.8 +296.5

Other Transport Equipment (excluding aircraft & marine vessel) -16.3 +10.1 +8.1

Other Machinery and Equipment +14.0 +7.7 +3.1

GDFCF +2.2 -1.9 +19.0

GDFCF (excluding aircraft & marine vessel) +4.8 -1.6 +5.5

Table I.2: Real Growth Rates of GDFCF by Type of Capital Goods: 2004 - 2006

2004 2005 1

2006 1

(Per cent)

1 Revised estimatesSource: Central Statistics Office, Government of Mauritius.

16

18

20

22

24

26

28

30

1999 2000 2001 2002 2003 2004 2005 2006

Per cent

GNS to GDP

GDFCF to GDP

Chart I.2: Ratios of GDFCF and GNS to GDP at Market Prices:1999 - 2006


Agriculture

5%Manufacturing

10% Electricity, Gas and

Water

6%

Construction

2%

Wholesale and Retail

Trade

6%Hotels and

Restaurants

13%

Transport,Storage

and Communication

21%

Financial

intermediation

3%

Real Estate, Renting

and Business Services

21%

Government and

Others

12%

Chart I.3: Investment by Sector in 2006


16


1. Agriculture, Hunting, Forestry and Fishing +33.8 +56.9 +16.8

2. Mining and Quarrying +150.8 -100.0 -

3. Manufacturing +26.5 -1.8 -18.2

of which: Export oriented enterprises -6.8 -12.3 +4.6

4. Electricity, Gas and Water -4.8 +45.8 +11.0

5. Construction +19.5 -10.6 +27.1

6. Wholesale and Retail Trade; Repair of Motor Vehicles,

Motor Cycles, Personal and Household Goods -3.7 +3.4 +3.7

of which: Wholesale and Retail Trade -4.3 +3.9 +4.1

7. Hotels and Restaurants +52.2 -24.5 +46.8

8. Transport, Storage and Communication -30.3 +5.6 +123.2

9. Financial Intermediation +15.8 +32.8 +17.5

10. Real Estate, Renting, and Business Activities +0.6 -11.5 +4.1

Owner occupied dwellings -2.3 -10.5 +10.3

Other +13.2 -15.5 -21.0

11. Public Administration and Defence; Compulsory Social Security +9.5 -26.0 -1.0

12. Education -10.6 +6.1 -29.1

13. Health and Social Work +15.2 -25.9 +2.8

14. Other Services -34.6 +25.2 -8.3

Gross Domestic Fixed Capital Formation +2.2 -1.9 +19.0

Table I.3: Real Growth Rates of GDFCF by Industrial Use: 2004 - 2006

2004 2005 2006 1

(Per cent)


AGRICULTURE

The agricultural sector registered a positivegrowth of 0.6 per cent in 2006 after contracting by5.4 per cent in 2005. This was the combined resultof a growth of 4.5 per cent in the non-sugaragricultural sector, including activities related tohunting, forestry and fishing and a contraction of 2.9per cent of the sugarcane sector, which improvednonetheless compared to the contraction of 9.2 percent that it underwent in the previous year.

Table I.4 shows the main aggregates of theagricultural sector for the years 2004 through2006. Chart I.5 shows the sectoral distribution ofGDP at basic prices in 2006.

Sugar

Sugar production, affected by unfavourableclimatic conditions, contracted by 2.9 per cent,from 519,816 tonnes in 2005 to 504,857 tonnes in2006. Value added of sugarcane accounted fornearly 51 per cent of the total value added of theagricultural sector.

-10

-20

-30

0

10

30

40

50

60

1999 2000 2001 2002 2003 2004 2005 2006

Per cent

PublicInvestment

PrivateInvestment

Chart I.4: Growth Rates of Public and Private Investment: 1999 -2006


17


1. Value Added at current basic prices (Rs million) 9,830 9,790 10,130

of which: Sugarcane 5,261 5,212 5,137

2. Annual Real Growth Rate (Per cent) +8.1 -5.4 +0.6

3. Share of Agriculture in GDP at basic prices (Per cent) 6.5 6.0 5.5

4. Investment at current prices (Rs million) 1,328 2,225 2,764

5. Share of Investment in Agriculture in total GDFCF (Per cent) 3.5 5.6 5.5

6. Sugar Exports (Rs million) 9,631 10,536 11,165

7. Agricultural Exports other than Sugar (Rs million) 290 273 252

8. Share of Agricultural Exports in total Domestic Exports (Per cent) 22.7 25.7 23.9

Table I.4: Main Aggregates of the Agricultural Sector: 2004 - 2006

2004 2005 20061

1 Revised estimates. Source: Central Statistics Office, Government of Mauritius.

Export proceeds of cane sugar rose fromRs10,536 million in 2005 to Rs11,198 million in2006. However, the share of sugar exports in totaldomestic exports fell from 25.0 per cent in 2005 to23.5 per cent in 2006. Export receipts from canemolasses decreased from Rs173 million in 2005 toRs153 million in 2006.

Non-Sugar Agricultural Sector

The non-sugar agricultural sector, includingactivities related to hunting, forestry and fishing,expanded by 4.5 per cent in 2006 following acontraction of 1.1 per cent in 2005. Value added bythis sector went up, in nominal terms, fromRs4,578 million in 2005 to Rs4,993 million in 2006and its share in the agricultural sector increasedfrom 46.8 per cent to 49.3 per cent over thesame period.

Foodcrop production increased from 96,782tonnes in 2005 to 106,902 tonnes in 2006.Theproduction of green tea leaves went up from 6,798tonnes to 7,649 tonnes while tobacco leaf productiondecreased from 357 tonnes to 298 tonnes.

MANUFACTURING

The manufacturing sector, which comprisessugar milling, food (excluding sugar), textile, and“other manufacturing”, grew, in real terms, by 4.0per cent in 2006 as against a negative growth of 5.5per cent in 2005. Value added by the manufacturingsector represented 20.0 per cent of total value addedin the economy in 2006. Food processing industriesexpanded by 9.6 per cent in 2006 compared to 2.1per cent in 2005. The textile sub-sector recorded agrowth of 2.9 per cent in 2006 in contrast to adecline of 14.7 per cent in 2005. Manufacturingindustries previously operating with an EPZcertificate registered a growth of 4.6 per cent in2006 after four years of negative growths. The sugarmilling sub-sector contracted by 2.9 per cent in 2006compared to a contraction of 9.2 per cent theprevious year. The “Other manufacturing” sub-sector grew by 1.8 per cent in 2006 compared to 0.4per cent in 2005 in part due to the introduction ofduties on a number of imported goods to protectlocal producers and to measures adopted to boost upSmall and Medium Enterprises.

Agriculture

6% Manufacturing

20%

Electricity, Gas and Water

2%

Construction6%Transport, Storage and

Communication12%

Financial Intermediation10%

Real Estate, Renting and Business Services

10%

Government and Others13%

Wholesale and Retail Trade12%

Hotels and Restaurants 9%

Chart I.5: Sectoral Distribution of GDP at Basic Prices in 2006


BOM_AR pg 1-118 07-vkh 8/4/08 10:29 PM Page 17

EPZ exports went up by 16.1 per cent toRs33,249 million in 2006, in contrast to a decline of9.6 per cent in 2005. EPZ imports also increased by22.6 per cent to Rs19,026 million in 2006, asagainst a contraction of 9.8 per cent in 2005. NetEPZ exports rose by 8.5 per cent to Rs14,584million in 2006.

EPZ exports in 2006 were mainly directed tothe United Kingdom, France and United States, withshares of 33.9 per cent, 19.6 per cent and 13.1 percent, respectively, in total EPZ exports. The majorcountries of origin of EPZ imports remained India,France and China, with shares of 14.6 per cent,12.8 per cent and 11.3 per cent, respectively. EPZimports from European, Asian and African countrieswent up by 20.6 per cent, 11.6 per cent and 92.1per cent, respectively.

TOURISM

The tourism sector expanded by 3.5 per centin 2006, down from the 5.6 per cent growthrecorded in 2005. This was attributed to thecancellation of hotel reservations by tourists due tothe outbreak of the “Chikungunya” disease. Grosstourism receipts increased by 24.3 per cent, fromRs25,704 million in 2005 to Rs31,942 million in2006, compared to a growth of 9.6 per cent in2005. Tourist arrivals went up from 761,063 in2005 to 788,276 in 2006 while total tourist nightsrose from 7,498,000 to 7,761,000. In 2006, 90.4per cent of foreign visitors came to Mauritius onholidays while 3.4 per cent were business travellers.

Chart I.6 shows tourist arrivals and tourismreceipts for the years 1999 through 2006.

Tourist arrivals from Europe went up by 1.5per cent to 510,479 in 2006, down from the 5.4 percent growth rate registered in 2005. Tourists fromEuropean countries accounted for nearly two thirdsof total tourist arrivals in 2006. Tourist arrivalsfrom United Kingdom, Italy and Germany rose by7.3 per cent, 59.7 per cent and 2.3 per cent,

Table I.5 shows the main aggregates of the manufacturing sector for the years 2004 through 2006.

18


1. Value Added at current basic prices (Rs million) 31,942 32,187 36,356

2. Annual Real Growth Rate (Per cent) +0.6 -5.5 +4.0

3. Share of Value Added in GDP at basic prices (Per cent) 21.0 19.8 20.1

4. Investment at current prices (Rs million) 5,346 5,548 4,819

5. Share of Investment in total GDFCF (Per cent) 14.1 14.0 9.6

Table I.5: Main Aggregates of the Manufacturing Sector: 2004 - 2006

2004 2005 2006 1

(Tonnes Tel Quel)


0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

1999 2000 2001 2002 2003 2004 2005 2006

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Tourist Arrivals Tourism Receipts

Chart I.6: Tourist Arrivals and Tourism Receipts: 1999 - 2006


Tourist Arrivals Tourism Receipts(Rs million)

BOM_AR pg 1-118_06/08 6/8/08 10:06 Page 18

19


respectively. However, arrivals from France, ourmain market, contracted significantly by 17.3 percent due to the outbreak of “Chikungunya”. Thenumber of tourists from the African regionincreased by 2.3 per cent, from 185,208 in 2005 to189,458 in 2006, compared to an increase of 5.4per cent in the previous year. Tourist arrivals fromAsia, America and Australia went up by 22.2 percent, 10.6 per cent and 23.5 per cent, respectively.Tourist arrivals from Reunion Island declined by10.0 per cent while those from the Republic ofSouth Africa increased by 21.1 per cent.

At the end of December 2006, there were 98hotels in operation with 10,666 rooms and 21,403bed places compared to 10,497 rooms and 21,072bed places at the end of December 2005. Fourhotels were undergoing renovation works andwere, thus, not operational. The average roomoccupancy rate for all hotels went up from 63 percent in 2005 to 66 per cent in 2006 while that of“large” hotels rose from 66 per cent to 69 per centover the same period.

Direct employment in the tourist industryincreased from 25,377 at the end of March 2005 to25,798 at the end of March 2006. This representeda growth of 1.7 per cent, down from 12.2 per centin 2005.

FINANCIAL INTERMEDIATION

The ‘Financial intermediation’ sector, whichincludes insurance, banking services and otherfinancial intermediation activities, grew by 7.0 percent in 2006, up from 5.4 per cent in 2005. Thisexpansion was mainly driven by banking activities,which went up by 7.1 per cent, up from 4.8 percent in 2005, and by other financial intermediationactivities, which grew by 11.0 per cent compared to9.5 per cent in the previous year. As for the‘Insurance’ sub-sector, it registered a growth of 5.0per cent, unchanged from 2005.

REAL ESTATE, RENTING ANDBUSINESS ACTIVITIES

The ‘Real estate, renting and businessactivities’ sector, which includes owner occupieddwellings, renting of machinery and operator,computer activities and other business activities,recorded a lower growth of 6.3 per cent in 2006compared to 6.5 per cent in 2005. The ‘Owneroccupied dwellings’ sub-sector expanded by 4.4 percent in 2006, down from 4.8 per cent in theprevious year, while activities other than ‘Owneroccupied dwellings’ increased by 8.1 per cent,unchanged from 2005.

OTHER SECTORS

The ‘Electricity, gas and water’ sector grew, inreal terms, by 4.0 per cent in 2006 compared to 3.8per cent in 2005. The ‘Construction’ sectorrebounded by 5.2 per cent in 2006, after a declineof 4.4 per cent in the previous year, mainly as aresult of the construction and renovation of hotelsand the implementation of Integrated ResortScheme projects. Growth in the ‘Transport,storage and communications’ sector stood at 7.4per cent in 2006, lower than the 7.7 per centexpansion in 2005. The ‘Wholesale and retail trade’sector expanded by 5.5 per cent in 2006, downfrom 5.6 per cent in 2005, due to lower growths infinal consumption resulting from price increases inconsumer goods, and in trade activities of theFreeport. The ‘Public administration and defenceand compulsory social security’ sector went up by4.0 per cent in 2006 compared to 5.3 per cent inthe previous year. The ‘Education’ sector grew by4.1 per cent in 2006, down from 6.1 per cent in2005. Value added in the ‘Health and social work’sector grew by 7.9 per cent in 2006 compared to6.2 per cent in 2005, while ‘Other services’expanded by 6.5 per cent in 2006 compared to 7.2per cent in the previous year.


20

Labour Market and Price Developments Annual Report 2006-07

The erosion of trade preferences for its mainexports coupled with the challenges of globalizationmakes it imperative for Mauritius to raiseproductivity and be globally competitive. To thatend, especially as the country shifts toward aservices-dominated and knowledge-basedeconomy, labour market flexibility has becomevital. The central wage-setting framework thatcharacterized the labour market for decadesallowed for little wage moderation, did not favourwage differentiation across sectors and enterprises,and focused more on job preservation than on jobcreation. The setting up of the National Pay Council,which aims at broadening the use of practices inwage agreements to better reflect sectoral andfirm-specific conditions, represents a breakthroughin labour market reform. To bring in moreflexibility in the labour market, labour laws havebeen revised too.

WAGE DEVELOPMENTS

Average Monthly Earnings

According to the Survey of Employment andEarnings in “large” establishments carried out bythe Central Statistics Office (CSO), the averagemonthly earnings for all industrial groups increasedfrom Rs12,630 to Rs13,385, or 6.0 per cent,between March 2006 and March 2007 compared to4.7 per cent between March 2005 and March 2006.Adjusted for the twelve-month running inflationrate, the average monthly earnings for all industrialgroups contracted by 3.4 per cent between March2006 and March 2007 compared to a decline of 0.2per cent between March 2005 and March 2006.

An analysis by industrial group shows thataverage monthly earnings recorded increases in therange of 1.6 per cent to 9.4 per cent between March2006 and March 2007. The highest increase inaverage monthly earnings occurred in “Electricity,Gas and Water” (9.4 per cent) followed by “Healthand Social Work” (9.0 per cent), “Construction” (8.4per cent), “Mining and Quarrying” (7.5 per cent)and “Hotels and Restaurants” (7.3 per cent)between March 2006 and March 2007. Theremaining sectors recorded increases in averageearnings in the range of 1.6 per cent to 6.7 per cent.

Table II.1 shows the average monthlyearnings in large establishments by industrial groupover the period March 2005 through March 2007.

Compensation of Employees

Compensation of employees went up, innominal terms, by 8.3 per cent, from Rs68,877million in 2005 to Rs74,572 million in 2006compared to an increase of 7.0 per cent in 2005.Compensation of employees as a percentage ofGDP at basic prices fell from 42.5 per cent in 2005to 41.0 per cent in 2006. Compensation ofemployees in the General Government sector,which accounts for around 25 per cent of totalcompensation, grew, in nominal terms, by 5.6 percent in 2006 compared to 7.0 per cent in 2005,while for the rest of the economy, it increased by9.2 per cent in 2006 compared to 7.0 percent in 2005.

Cost of Living Compensation

During fiscal year 2006-07, a cost of livingcompensation of 8.7 per cent was awarded toemployees receiving a monthly salary of up toRs3,000, while a compensation of Rs300 wasawarded to those earning between Rs3,000 andRs6,500, Rs350 to those earning between Rs6,500and Rs8,000, and Rs400 to those drawing amonthly salary of above Rs8,000. Some companiesthat are profitable and operating in economicsectors such as the financial and hotel sectors haveawarded their employees compensation above thatproposed by the government.

Wage Rate Index

Over the period September 2005 toSeptember 2006, a general upward movement wasnoted in the overall wage rate index as well as inthe indices of all industry groups. The overall wagerate index rose by 3.8 per cent, from 136.9 inSeptember 2005 to 142.1 in September 2006compared to an increase of 5.0 per cent over thepreceding period. The increase in the periodSeptember 2005 to September 2006 was mainlydriven by rises in the industry groups“Construction” (9.5 per cent), “Electricity andWater” (8.3 per cent), “Hotels and Restaurants”(7.0 per cent), “Real Estate, Renting and BusinessActivities” (6.2 per cent), “Agriculture, Hunting,Forestry and Fishing” (5.6 per cent) and

II. LABOUR MARKET ANDPRICE DEVELOPMENTS


21

Annual Report 2006-07 Labour Market and Price Developments

1. Agriculture and Fishing 4.9 5.6

2. Manufacturing, Mining and Quarrying 5.5 3.7

3. Electricity and Water 6.2 8.3

4. Construction 7.1 9.5

5. Wholesale & Retail Trade; Repair of Motor Vehicles, Motorcycles,

Personal and Household Goods 6.4 3.1

6. Hotels and Restaurants 5.8 7.0

7. Transport, Storage and Communications 5.2 0.8

8. Financial Intermediation 5.2 2.4

9. Real Estate, Renting and Business Activities 3.8 1 6.2

10. Public Administration and Defence; Compulsory Social Security 5.7 3.0

11. Education 1.1 2.6

12. Health and Social Work 2.7 0.3

13. Other Community, Social and Personal Services 4.6 3.1

All Sectors 5.0 3.8

Table II.2: Annual Percentage Change in Wage Rate Index by Industry Group

Industry Group Sep-05 Sep-06

(Per cent)

1 Revised Source: Central Statistics Office, Government of Mauritius.

1. Agriculture, Forestry and Fishing 9,825 10,019 10,510 4.9 -4.4

of which: Sugarcane 9,054 9,202 9,453 2.7 -6.4

2. Mining and Quarrying 5,588 5,895 6,340 7.5 -2.0

3. Manufacturing 7,798 8,202 8,625 5.2 -4.1

of which: Sugar 11,284 12,468 12,897 3.4 -5.7

EPZ products 6,656 7,002 7,428 6.1 -3.3

4. Electricity, Gas and Water 19,457 22,056 24,125 9.4 -0.3

5. Construction 12,042 13,047 14,143 8.4 -1.2

6. Wholesale & Retail Trade; Repair of Motor Vehicles, 12,772 13,547 14,387 6.2 -3.2

Motorcycles, Personal and Household Goods

of which: Wholesale & Retail Trade 12,776 13,500 14,270 5.7 -3.6

7. Hotels and Restaurants 9,881 10,560 11,326 7.3 -2.2

8. Transport, Storage and Communication 15,982 16,664 17,554 5.3 -4.0

9. Financial Intermediation 21,478 22,692 24,117 6.3 -3.1

of which: Insurance 19,293 19,536 21,212 8.6 -1.0

10. Real Estate, Renting and Business Activities 12,822 13,447 13,657 1.6 -7.4

11. Public Administration and Defence; Compulsory Social Security 15,056 14,535 15,507 6.7 -2.7

12. Education 15,096 16,216 16,682 2.9 -6.2

13. Health and Social Work 16,628 17,306 18,869 9.0 -0.6

14. Other Services 11,427 12,298 12,554 2.1 -6.9

Total 12,061 12,630 13,385 6.0 -3.4

Table II.1: Average Monthly Earnings 1 in Large Establishments

Industrial Group Mar-05 2

Mar-062

Mar-07 3

% Nominal % ChangeChange Adjustedbetween for Increase Mar-06 in Price

and Mar-07 Level(Rs) (Rs) (Rs)

1 Earnings of daily, hourly and piece rate workers have been converted to a monthly basis. 2 Revised. 3 Provisional.Source: Central Statistics Office, Government of Mauritius.


22


“Manufacturing, Mining and Quarrying” (3.7 percent). Increases in the remaining industry groupsranged from 0.3 per cent to 3.1 per cent.

Adjusted for the twelve-month runninginflation rate, the overall wage rate in the economydeclined by 2.8 per cent between September 2005and September 2006 compared to a contraction of0.5 per cent between September 2004 andSeptember 2005.

Table II.2 gives details on the annualpercentage change in the wage rate index by industrygroup for September 2005 and September 2006.

LABOUR FORCE, EMPLOYMENT ANDUNEMPLOYMENT: 2006

Labour Force

The population of the Republic of Mauritius,including Agalega and St Brandon, was estimatedat 1,256,727 as at 31 December 2006, of whom621,304 were males and 635,423 were females,that is, a sex ratio of 97.8 males to 100 females.The population growth rate was 0.7 per cent in2006 compared to 0.9 per cent in 2005.

According to the “Continuous Multi-PurposeHousehold Survey” (CMPHS), the total labour force,inclusive of foreign workers, grew from 559,100 in2005 to 565,100 in 2006, or 1.1 per cent, downfrom 1.9 per cent registered in 2005. The numberof foreign workers increased from 16,600 in 2005 to16,700 in 2006. The male labour force grew by 0.3per cent while the female labour force increased by2.5 per cent in 2006 compared with growth of 0.5per cent and 4.4 per cent, respectively, in 2005.

Employment

The total number of persons in employment,inclusive of foreign workers, increased by 1.6 per

cent to 515,300 in 2006 compared to a growth rateof 0.5 per cent in 2005. Male employment grew by0.6 per cent to reach 340,500 while femaleemployment grew by 3.6 per cent to stand at174,800 in 2006.

An analysis of employment by sector ofeconomic activity in 2006 shows that with around121,000 workers, the “Manufacturing” sector hadthe largest workforce, which represented 23.5 percent of total employment compared to 23.7 percent in 2005. “Wholesale and Retail Trade, Repairof Motor Vehicles, Motorcycles, Personal andHousehold Goods” was the second largest employerwith around 78,800 workers, or 15.3 per cent oftotal employment, compared to 15.1 per cent in2005. Each of the remaining sectors employedbetween 300 and 48,400 workers.

Table II.3 provides labour market indicatorsfor 2000 through 2006 and Table II.4 showsemployment by industrial group for 2005 and 2006.

Employment in the EPZ

The EPZ sector, which comprisedpredominantly the textiles and clothing industry,went through a period of restructuring andconsolidation in view of the loss of the preferentialmarket access for its exports as from January2005. As at end-December 2006, the number ofenterprises in the EPZ stood at 434 compared to506 as at end-December 2005. During 2006, ninenew EPZ firms came into operation while eighty-one EPZ enterprises closed down.

Employment in the EPZ fell by 2,322, from66,931 at the end of December 2005 to 64,609 atthe end of December 2006 compared to a drop of1,091 in the corresponding previous period. Maleemployment decreased by 1,494 while femaleemployment went down by 828 in 2006.Employment creation in the EPZ during 2006

Total Labour force 517.6 526.8 530.0 539.1 548.8 559.1 565.1

Employment 484.9 492.1 493.2 499.0 504.2 507.2 515.3

Unemployment 32.7 34.7 36.8 40.1 44.6 51.9 49.8

Unemployment rate (%) 6.5 6.8 7.2 7.7 8.4 9.6 9.1

Table II.3: Labour Market Indicators

Note: Data are based on the CMPHS. Estimates refer to population aged 15 years and over and include foreign workers.

2000 2001 2002 2003 2004 2005 2006


23


1. Agriculture, Forestry and Fishing 48.7 48.1

of which: Sugarcane 18.6 18.2

Non-Sugar cane 30.1 29.9

2. Mining and Quarrying 0.3 0.3

3. Manufacturing 120.1 121.0

of which: Sugar 2.2 2.1

EPZ Products 65.5 65.0

Non-sugar, Non-EPZ 52.4 53.9

4. Electricity, Gas and Water Supply 3.0 3.0

5. Construction 47.0 48.4

6. Wholesale & Retail Trade; Repair of Motor Vehicles, Motorcycles,

Personal and Household Goods 76.5 78.8

7. Hotels and Restaurants 31.1 31.8

8. Transport, Storage and Communications 36.4 36.9

9. Financial Intermediation 8.8 9.4

10. Real Estate, Renting and Business Activities 20.0 21.1

11. Public Administration and Defence; Compulsory Social Security 39.4 39.6

12. Education 27.1 28.4

13. Health and Social Work 15.0 15.0

14. Other Services 33.6 34.0

All Sectors 507.0 515.8

Table II.4: Employment by Industrial Group

Industrial Group 2005 2006

(Thousands)

1 Employment figures include foreign workers.Source: Central Statistics Office, Government of Mauritius.

amounted to 5,563, with 4,705 new jobs createdfollowing expansion in 37 existing enterprises and858 persons recruited in 9 new enterprises. Duringthe same period, total job losses in the EPZamounted to 7,885, of which 5,352 were due to jobshedding in 34 existing enterprises and 2,533 dueto the closure of 81 enterprises.

Unemployment

The rate of unemployment declined from 9.6per cent in 2005 to 9.1 per cent in 2006. Thenumber of unemployed persons went down from51,900 (20,200 males and 31,700 females) in 2005to around 49,800 (19,200 males and 30,600females) in 2006. Male unemployment declinedfrom 5.8 per cent in 2005 to 5.5 per cent in 2006while female unemployment went down from 16.4per cent to 15.5 per cent over the same period.

In the second quarter of 2007, 36.3 per centof the unemployed were in the age bracket of 25 to39 years while 29.2 per cent were in the agebracket of 20 to 24 years. The mean age of theunemployed was 27 for males and 31 for females.26.4 per cent of the unemployed had studied up tothe primary level while 66.9 per cent had studiedup to the secondary level, with only 8.7 per centhaving passed the Higher School Certificate.Regarding the duration of unemployment, 68.7 percent of the unemployed had been looking for a jobfor up to one year and 31.3 per cent for more thanone year.

UNIT LABOUR COST ANDPRODUCTIVITY

During the period 1996 to 2006, unit labourcost maintained its increasing trend, rising by an

BOM_AR pg 1-118_06/08 6/8/08 10:07 Page 23

24


4.5

6.5

8.5

10.5

12.5

14.5

16.5

18.5

2000 2001 2002 2003 2004 2005 2006

Per Cent

Female

Total

Male

Chart II.1: Unemployment Rate

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

12.0

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Per cent

Average Compensation Unit Labour Cost

Labour Productivity

Chart II.2: Growth Rates of Average Compensation, Unit LabourCost and Labour Productivity - Total Economy


average annual rate of 4.0 per cent as the averagecompensation growth rate (7.7 per cent) continuedto outweigh average growth in labour productivity(3.6 per cent).

Unit labour cost, defined as the labour costof producing one unit of output, grew by 2.9 percent in 2006 compared to 4.6 per cent in 2005.Average compensation in the economy grew by6.2 per cent in 2006 compared to 6.5 per cent in2005. Over the period 1996 to 2006, averagecompensation in the total economy grew by anannual average rate of 7.7 per cent while labourproductivity grew by an annual average rate of3.6 per cent, which resulted in an average annualgrowth of 4.0 per cent in unit labour cost.

In the manufacturing sector, unit labour costdeclined marginally by 0.7 per cent in 2006compared to an increase of 9.0 per cent in 2005.Over the period 1996-2006, unit labour cost in themanufacturing sector grew at an average annualrate of 4.5 per cent, driven by higher growth inaverage compensation (8.1 per cent) relative to thatof labour productivity (3.4 per cent). In US dollarterms, unit labour cost for the total economy fell by3.5 per cent in 2006 compared to a decline of 0.7per cent in 2005. In the manufacturing sector, unitlabour cost, in dollar terms, declined by 6.8 per centin 2006 compared to a rise of 3.4 per cent in 2005.

In 2006, labour productivity for the wholeeconomy, defined as the ratio of real output tolabour input, grew by 3.2 per cent compared to anincrease of 1.8 per cent in 2005. For themanufacturing sector, labour productivity increasedby 3.2 per cent in 2006 as against a contraction of

-4.5

-2.5

-0.5

1.5

3.5

5.5

7.5

9.5

11.5

13.5

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Per cent

Average Compensation

Unit Labour Cost

Labour Productivity

Chart II.3 Growth Rates of Average Compensation, Unit LabourCost and Labour Productivity - Manufacturing Sector



25


100.0

110.0

120.0

130.0

140.0

150.0

160.0

Jul-0

6

Aug

-06

Sep

-06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb

-07

Mar

-07

Apr

-07

May

-07

Jun-

07

Food and Non-Alcoholic Beverages

Alcoholic Beverages and Tobacco

Clothing and Footwear

Housing, Water, Electricity, Gas and Other Fuels

Furnishings, Household Equipment and Routine Household Maintenance

Health

100.0

110.0

120.0

130.0

140.0

150.0

160.0

Jul-0

6

Aug

-06

Sep

-06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb

-07

Mar

-07

Apr

-07

May

-07

Jun-

07

Transport

Communication

Recreation and Culture

Education

Restaurants and Hotels

Miscellaneous Goods and Services

Chart II.4 and II.5: Monthly Evolution of the Twelve Divisions of the CPI Basket of Goods and Services during 2006-07(Base: July 2001 - June 2002 = 100)

1.5 per cent in 2005, while in the EPZ, it rose by5.4 per cent in 2006 in contrast to a contraction of4.1 per cent in 2005. Labour productivity in thetextiles sub-sector of the EPZ rose by 1.4 per centin 2006 as against a contraction of 4.2 per cent in2005 while in the non-textiles sub-sector of theEPZ, it increased by 22.6 per cent in 2006 incontrast to a decline of 12.6 per cent in 2005.

Over the period 1996-2006, for the totaleconomy, multifactor productivity grew by anaverage of 0.2 per cent annually while capitalproductivity contracted by an average annual rateof 0.9 per cent. In 2006, capital productivity grewby 0.6 per cent compared to a contraction of 1.9per cent in 2005 while multifactor productivity roseby 0.1 per cent in 2006 as against a contraction of0.8 per cent in 2005.

Charts II.2 and II.3 show the growth rates ofaverage compensation, unit labour cost and labour

productivity for the total economy and themanufacturing sector, respectively, for the years1995 through 2006.

PRICES

Inflation, which is measured by thepercentage change in the yearly average ConsumerPrice Index (CPI), rose from 5.1 per cent in2005-06 to 10.7 per cent in 2006-07. The rise inthe inflation rate is to a large extent attributable tobudgetary measures, the pass-through of theexchange rate depreciation to domestic prices, theincrease in freight rates and adverse climaticconditions in certain exporting countries leading toa hike in prices of some imported commodities.

The CPI in Mauritius increased by 12.6 points,or 10.0 per cent, from 126.2 in June 2006 to 138.8in June 2007 compared to an increase of 8.9 points,or 7.6 per cent, recorded in 2005-06. All the

26


1. Food and Non-Alcoholic Beverages 299 6.3 2.3 5.9 4.2 19.9

2. Alcoholic Beverages and Tobacco 86 3.3 -1.0 1.7 0.5 4.4

3. Clothing and Footwear 60 1.2 1.4 1.5 1.6 5.9

4. Housing, Water, Electricity, Gas and Other Fuels 96 2.7 1.4 0.2 0.2 4.5

5. Furnishings, Household Equipment and Routine Household Maintenance 80 2.8 1.1 2.0 0.9 6.9

6. Health 28 1.4 0.4 1.3 1.0 4.0

7. Transport 139 8.1 3.0 -6.8 0.5 4.2

8. Communication 31 0.2 1.8 0.0 0.0 1.9

9. Recreation and Culture 53 0.6 0.2 1.2 2.3 4.4

10. Education 24 0.0 0.0 9.0 0.0 9.0

11. Restaurants and Hotels 50 6.0 0.7 1.5 1.8 10.3

12. Miscellaneous Goods and Services 54 1.7 2.2 2.7 3.1 10.0

ALL GROUPS 1000 4.4 1.5 1.8 2.0 10.0

DIVISIONSWeights

Quarter ended2006-07

Sep-06 Dec-06 Mar-07 Jun-07

Table II.5: Quarterly Percentage Change in the Sub-indices of the CPI by Division(Per cent)


Divisions of the CPI basket of goods and servicesrecorded increases during the period under review.The most significant rise of 25.3 points (or 19.9 percent) was recorded in “Food and non-alcoholicbeverages”, mainly as a result of higher prices offresh vegetables, powdered milk, fruits, and otherbasic food items. “Restaurants and Hotels”recorded the second largest increase of 14.5 points(or 10.3 per cent). The third largest rise was notedin “Miscellaneous goods and services”, which wentup by 12.5 points (or 10.0 per cent). “Education”recorded a hike of 11.1 points, or 9.0 per cent,while the remaining eight divisions registeredincreases in their sub-indices, ranging from 2.5 to8.2 points, or 1.9 to 6.9 per cent.

Table II.5 shows the quarterly percentagechange in the sub-indices of the 12 Divisions in theCPI basket of goods and services. Charts II.4 andII.5 depict the monthly evolution of the twelveDivisions of the CPI basket of goods and servicesduring fiscal year 2006-07.

CORE INFLATION

Core inflation measures are constructed forMauritius using the permanent exclusion method

and the trimmed mean approach. TRIM10truncates 5 per cent of each tail of the distributionof price changes, that is, it rules out 5 per cent ofthe most positive and 5 per cent of the mostnegative price changes. Based on the exclusionmethod, CORE1 excludes “Food, Beverages and

3.0

4.0

5.0

6.0

7.0

8.0

9.0

10.0

11.0

Jun-

05

Aug

-05

Oct

-05

Dec

-05

Feb

-06

Apr

-06

Jun-

06

Aug

-06

Oct

-06

Dec

-06

Feb

-07

Apr

-07

Jun-

07

Headline Inflation CORE1 CORE2 TRIM10

Chart II.6: Headline and Core Inflation

Per cent

27


Headline Inflation 6.8 8.9 9.7 10.7

CORE 1 5.4 7.4 7.7 7.6

CORE 2 6.1 7.2 7.6 7.9

TRIM 10 5.4 6.6 7.0 7.6

Table II.6: Headline and Core Inflation Rates

Quarter ended


Consumer Price Index 1000 5.4 7.6 10.0

of which:

Food 274 6.9 6.6 21.2

Beverages and Tobacco 111 3.6 16.9 4.5

Electricity, Gas, Water, Fuels and Transport 141 9.8 8.3 4.5

Other Goods and Services 474 3.6 5.7 6.3

Producer Price Index

Agriculture 5.4 4.6 5.1

Manufacturing 5.8 10.5 17.2

Table II.7: Price Indicators

Weights 2004-05 2005-06 2006-07

Annual Change (%)

Tobacco” items from the CPI while CORE2 inaddition strips energy and administered prices fromthe CPI.

While headline rate of inflation rose from 5.1per cent in 2005-06 to 10.7 per cent in 2006-07,CORE1, CORE2 and TRIM10 rates of inflation wentup from 4.1 per cent, 4.5 per cent and 4.4 per centto 7.6 per cent, 7.9 per cent and 7.6 per cent,respectively. The core inflation measures duringfiscal year 2006-07 deviated by between 0.5 and3.1 percentage points from headline inflation.

Table II.6 shows the headline and coreinflation rates on a quarterly basis and Chart II.6shows the movements of headline inflation and thethree measures of core inflation over the periodJune 2005 through June 2007.

PRODUCER PRICES

There are two measures of producer prices inMauritius: the Producer Price Index-Manufacturing(PPI-M) and Producer Price Index-Agriculture (PPI-A).

The Producer Price Index-Agriculture (PPI-A)rose from 123.3 in June 2006 to 129.6 in June2007, or 5.1 per cent, as against an increase of 4.6per cent in 2005-06. PPI-A inflation, which iscalculated as the percentage change in the annualProducer Price Index-Agriculture (PPI-A), rose from5.0 per cent during 2005-06 to 7.0 per cent for the12-month period ended June 2007.

The Producer Price Index-Manufacturing (PPI-M) went up from 126.1 in June 2006 to 147.8 inJune 2007, or 17.2 per cent, higher than the rise of10.5 per cent registered in the preceding fiscalyear. PPI-M inflation, which is calculated as thepercentage change in the annual Producer PriceIndex-Manufacturing (PPI-M), rose from 7.5 percent during 2005-06 to 13.2 per cent for the 12-month period ended June 2007.

Table II.7 gives the annual percentage changein the Consumer Price Index, Producer Price Index-Agriculture and Producer Price Index-Manufacturingfor fiscal years 2004-05, 2005-06 and 2006-07.

(Per cent)


28

Money and Banking Annual Report 2006-07

During 2006-07, monetary management wasconfronted with the following challenges: anincrease in the rate of inflation driven mostly byexternal factors; continued deterioration of theexternal sector outlook and the large overhang ofliquidity, amongst others. The Bank shifted thefocus of its monetary analysis based on theDepository Corporations Survey, which is theframework recommended by the IMF for compiling,analysing and disseminating monetary statistics.

MONETARY POLICY: 2006-07

During 2006-07, the basic thrust of monetarypolicy was geared towards striking the rightbalance in generating a proper setting for sustainedgrowth while taking pre-emptive measures tocontain the propagation of inflationary impulses inthe economy arising chiefly from internationalsources. The Bank also aimed at promotingmonetary conditions conducive to the reduction ofinflation differentials with the country’s majortrading and investment partners, while attemptingto preserve the attractiveness of key rupee-denominated financial instruments and keeping incheck any pressures on the domestic foreignexchange market.

It may be recalled that the Bank, effective 18December 2006, introduced a new framework forthe conduct of monetary policy. Under thisframework, the key Repo Rate is the key policy rateused by the Bank to signal changes in its monetarypolicy stance and it was set at 8.50 per cent.Moreover, as from 19 January 2007, themaintenance period for the cash reserve ratio waslengthened from one week to two weeks, withbanks required to maintain a two-week averagereserve balance equivalent to a minimum of 4.0 percent of their average deposit liabilities held over thetwo-week period preceding the maintenanceperiod. In addition, on any particular day during themaintenance period, the cash ratio must not fallbelow 2.0 per cent.

The Bank continued to utilize a combinationof open market operations, reserve requirementsand a standing facility as monetary policyoperating procedures.

The Bank tightened its monetary policy stanceby raising its Lombard Rate by a cumulative total of150 basis points between July and September2006. The hikes were effected against abackground of rising inflation, a worsening externalsector outlook coupled with excessive monetaryexpansion and were aimed at improving therelative attractiveness of rupee-denominatedfinancial assets. Banks adjusted their rupeedeposits and lending rates more or less in line withthe increases in the Lombard Rate.

Sections 54 and 55 of the Bank of MauritiusAct 2004 provide for the establishment of aMonetary Policy Committee (MPC) that would beresponsible for the formulation of monetary policyto be conducted by the Bank of Mauritius. TheMonetary Policy Committee was launched on 23April 2007 with a non-interest rate settingmeeting being held to discuss the organisation ofthe work of the Committee and to review themonetary policy framework and the economicsituation in Mauritius. The first interest rate-setting meeting was held on 30 June 2007 and theRepo Rate was raised by 75 basis points to 9.25per cent as from 2 July 2007. Consequently, theStanding Facility Rate was also increased to 13.25per cent per annum.

III. MONEY AND BANKING


Annual Report 2006-07 Note on the Change in Methodology in Monetary Statistics

Box 1 Note on the Change in Methodology inMonetary Statistics

Since June 2003, the Bank of Mauritius hasbeen compiling a Depository Corporations Survey(DCS) based on the framework laid down in theIMF’s Monetary and Financial Statistics Manual(MFSM). The MFSM, which provides theconceptual framework for presenting monetaryand financial statistics, includes all depositorycorporations in Mauritius, notably the Bank ofMauritius, banks and non-bank deposit-takinginstitutions. The MFSM considers broad money avery important concept in its methodology andconsiders the DCS, which presents data on broadmoney, to be the “major focus of monetarystatistics” and “to constitute a core set of data formacroeconomic analysis”. Besides assisting inmonetary policy formulation and monitoring, thestatistics covered form a basis for thedevelopment of a statistical framework forassessing financial sector stability.

The MFSM provides a set of tools foridentifying, classifying, and recording stocks andflows of financial assets and liabilities; describesstandard, analytically oriented frameworks inwhich the statistics may be presented andidentifies a set of analytically useful aggregateswithin those frameworks. The statistics cover allfinancial assets and liabilities of all institutionalunits within an economy, with a particular focuson the financial corporations sector. Mostfinancial assets are creditor claims that give riseto corresponding obligations, or liabilities, ofdebtors. A financial claim is an asset that entitlesthe creditor to receive a payment, or series ofpayments, from the debtor in the circumstancesspecified in the contract between them. Otherfinancial instruments of a contingent nature, suchas loan guarantees, are not financial assets andtherefore are not included in the monetary andfinancial statistics.

The set of principles and conceptsunderlying the monetary and financial statisticsas recommended by the framework of theMFSM are:

1. Economic Territory, Residence, and Centerof Economic Interest. The delineationbetween resident and nonresident entities isa key feature of all macro-statisticalsystems, including the monetary andfinancial statistics. The separateidentification of stocks and flows associatedwith claims on and liabilities to nonresidentsis necessary for the measurement of acountry’s international reserves and itsexternal debt. The definition of residence isbased on the concepts of economic territoryand center of economic interest rather thanon nationality or legal criteria. Aninstitutional unit has a center of economicinterest and is a resident of a country when,from some location (dwelling, place ofproduction, or other premises) within theeconomic territory of the country, the unitengages and intends to continue engaging(indefinitely or for a finite period) ineconomic activities and transactions on asignificant scale. Entities that do not satisfythe above requirements are referred toas nonresidents.

2. Sectorization. In defining monetary andcredit aggregates, it is necessary to identifythe money (credit) issuing and holdingsectors. Institutional units differ withrespect to their economic objectives,functions, and behavior and are groupedinto sectors that include units with similarcharacteristics. The resident units of theeconomy are grouped into the followingmutually exclusive institutional sectors:financial corporations, central government;nonfinancial corporations and other residentsectors. The financial corporations sectorcontains these subsectors (a) the centralbank; (b) other depository corporations (c)other financial corporations which compriseother financial intermediaries, insurancecorporations, pension funds and financial

29

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Note on the Change in Methodology in Monetary Statistics Annual Report 2006-07

auxiliaries and (d) public financialcorporations. The nonfinancial corporationssector contains three subsectors: (a) publicnonfinancial corporations and (b) othernonfinancial corporations.

3. Classification. The assets and liabilities ofthe depository corporations sector areclassified in the following broad categories:(i) Monetary gold and SDRs, (ii) Currencyand deposits, (iii) Securities other thanshares, (iv) Loans, (v) Shares and otherequity, (vi) Insurance technical reserves,(vii) Financial derivatives, (viii) Otheraccounts receivable/payable and (ix)Nonfinancial assets. The secondary level ofclassification disaggregates currency anddeposits into separate categories forcurrency, transferable deposits, savings andtime deposits. Shares and other equity onthe liability side of the balance sheets ofdepository corporations are disaggregatedinto the following categories (1) fundscontributed by owners; (2) retainedearnings; (3) general and special reserves;(4) SDR allocations (applicable to thecentral bank); (5) valuation adjustmentsand (6) Current Year Results. Otheraccounts receivable/payable are classifiedas (1) trade credit and advances and(2) other.

4. Valuation. Market price is used as theprimary concept of valuation oftransactions, other financial flows, andstocks. Recognizing that market pricequotations are not available for financialassets that are not traded in secondarymarkets or that are traded on an infrequentbasis, the market-equivalent values for suchfinancial assets have to be estimated, whichare referred to as fair values. Shares andother equity on both sides of the balancesheet need to be valued at market prices.For the monetary statistics, it isrecommended that, while shares and otherequity on the asset side of the balance sheetbe valued at market prices, somecomponents of shares and other equity onthe liability side be valued at historical, orbook, values. The valuation of loans is anexception to the valuation principle basedon market price or fair value. In particular,

loan values should be based on creditors’outstanding claims without adjustment forexpected loan losses. The standard unit ofaccount for the monetary and financialstatistics is the national currency unit.Foreign-currency-denominated assets andliabilities must be converted to nationalcurrency units using the market exchangerate prevailing on the transaction date,specifically the midpoint between the buyingand selling rates.

5. Time of Recording. Transactions must berecorded on an accrual, rather than cash,basis, thus coinciding with the change inownership of the asset rather than with thetime of payment.

6. Aggregation, Consolidation and Netting.Aggregation refers to the summing of stockand flow data across all institutional unitswithin a sector or subsector, or of all assetsor liabilities within a particular category.Consolidation refers to the elimination ofstocks and flows that occur betweeninstitutional units that are groupedtogether. Individual units or sectors mayhave the same kind of transaction both as ause and as a resource and the same kind offinancial instrument as an asset and as aliability. Combinations whereby the valuesof some elementary items are offset againstitems on the other side of the account orthat have the opposite sign are callednet recordings.

The organization and presentation ofmonetary statistics follow a hierarchical approachbased on two general data frameworks—sectoralbalance sheets and surveys. The first and mostbasic framework is the sectoral balance sheet,which contains the highly disaggregated stockand flow data for all categories of assets andliabilities of an individual subsector within thefinancial corporations sector. The secondframework is the survey, in which the data fromthe sectoral balance sheets of one or more of thefinancial corporations subsectors are combinedinto more aggregated asset and liabilitycategories that are particularly useful foranalytical purposes. The surveys comprise theCentral Bank Survey (CBS) and the OtherDepository Corporations Survey (ODCS). The

30

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31

Annual Report 2006-07 Note on the Change in Methodology in Monetary Statistics

Depository Corporations Survey (DCS) consolidatesthe CBS and the ODCS.

For monetary policy purposes, the focus ison the data for the depository corporationssector, presented in the CBS, the ODCS, and theDCS. The CBS contains data on all components ofthe monetary base, which comprises the centralbank liabilities underlying the monetaryaggregates of the economy. The DCS covers theaccounts of the depository corporations and is aconsolidation of the CBS and the ODCS. The DCSis a consolidated statement of stocks and flowsfor the accounts of all financial sectorcorporations that incur liabilities included in thenational definition of broad money. Theframework of the DCS is designed to facilitateanalysis of broad money and its components,credit aggregates and their components, anddepository corporations’ foreign assets andliabilities and other assets and liabilities. Bymaintaining the balance-sheet identity in theDCS, the broad money liabilities of depositorycorporations are linked to their claims on (i.e.,credit to) nonresidents and sectors of thedomestic economy, and to their other assets andliabilities. The balance sheet presentation of theDCS links depository corporations’ broad moneyliabilities to their foreign assets and liabilities andto their claims on and liabilities to centralgovernment, thereby linking the monetarystatistics to the balance of payments andgovernment finance statistics, respectively.

The DCS can be rearranged to show thatbroad-money liabilities (BML) equal the sum ofnet foreign assets (NFA), domestic credit (DC),and other items (net) (OIN). That is, BML = NFA+ DC – OIN. DC comprises net claims on centralgovernment and claims on other sectors. OINdenotes a residual category for other liabilitiesless other assets, when other liabilities include allliabilities not included in broad money. Thecomponents of DC are shown as DC = NCG +COS where NCG and COS denote net claims oncentral government and claims on other sectors(claims on the private sector), respectively. Thecomponents of NCG in the DCS are directly linkedto the government finance statistics. Data on the

transaction flows for the underlying componentsof net claims on central government can be usedto analyze the expansionary or contractionaryeffects on broad money that can arise fromfinancial transactions between the depositorycorporations and the central government. Growthin net claims on central government—through arise in depository corporations’ holdings ofgovernment securities, direct lending togovernment, and/or reduction in governmentdeposit holdings—will exert an expansionaryinfluence on the broad-money liabilities ofdepository corporations. The change in COSshows the total flows arising from changes indepository corporations’ claims on residentsectors other than the central government. Anincrease in these claims has an expansionaryeffect on broad money liabilities, whereas adecrease in these claims has a contractionaryeffect. Data on the sectoral components of thechange in COS can be used to analyze thesources of expansionary or contractionary effectson broad money, arising from growth or declinein depository corporations’ claims on the varioussectors of the economy.

From the DCS, the following measures ofmoney can be derived:

Narrow Money Liabilities = Currency outside Depository Corporations +Rupee Transferable Deposits

Broad Money Liabilities = Narrow Money Liabilities +Rupee Savings Deposits +Rupee Time Deposits + Foreign Currency Deposits+Securities other than

Shares

The BML thus derived for Mauritiusexcludes deposits of Global Business LicenseHolders held with banks, as it is postulated thatsuch deposits do not have any bearing on thedomestic economic developments. Similarly, theclaims on Global Business License Holders areexcluded from the Claims on Other Sectors forsimilar reasons.

BOM_AR pg 1-118_06/08 6/8/08 09:57 Page 31

32


DEPOSITORY CORPORATIONSSURVEY

The Depository Corporations Survey coversthe Bank of Mauritius and other depositorycorporations, which comprised 18 banks and 13nonbank deposit-taking institutions as at end ofJune 2007.

Net foreign assets of depository corporationsgrew by Rs18,960 million, from Rs64,202 million atthe end of June 2006 to Rs83,162 million at the endof June 2007, or 29.5 per cent, compared to amarginal decline of 1.0 per cent recorded in theprevious fiscal year. Net foreign assets of otherdepository corporations rose by 41.4 per cent, incontrast to a fall of 1.6 per cent in 2005-06. Partlyreflecting the net purchase of foreign currency bythe Bank on the interbank foreign exchangemarket, the net foreign assets of Bank of Mauritiusexpanded by 23.4 per cent as against a decline of0.6 per cent in 2005-06.

Domestic claims of depository corporations,excluding claims on GBL holders, expanded byRs11,837 million, from Rs198,606 million at theend of June 2006 to Rs210,443 million at the endof June 2007, or 6.0 per cent, lower than the 15.1per cent growth noted in 2005-06. Net claims onbudgetary central Government contracted byRs6,309 million, from Rs48,544 million at the endof June 2006 to Rs42,235 million at the end of June2007, or 13.0 per cent, as against an increase of10.0 per cent in 2005-06. Claims on other sectorsrose by Rs18,146 million, or 12.1 per cent, in 2006-07, lower than the 16.9 per cent increase recordedin the preceding year. Claims on GBL holdersexpanded by Rs1,251 million, from Rs8,907 millionat the end of June 2006 to Rs10,158 million at theJune 2007, or 14.0 per cent, lower than the 18.8per cent increase in 2005-06.

Broad Money Liabilities (BML) grew byRs16,993 million, from Rs198,415 million at the endof June 2006 to Rs215,408 million at the end ofJune 2007, or 8.6 per cent, higher than the rise of6.7 per cent registered in the preceding fiscal year.Of the components of BML, currency with publicrose by 11.2 per cent, higher than the increase of8.1 per cent recorded between end-June 2005 andend-June 2006; transferable deposits went up by17.3 per cent in contrast to the fall of 6.4 per cent

in 2005-06; savings deposits increased by 7.2 percent, lower than the growth of 7.4 per centregistered in the previous year; time depositsexpanded by 6.5 per cent compared to an increaseof 14.3 per cent in 2005-06; and securities otherthan shares included in broad money contracted by24.8 per cent.

The Rupee component of deposits included inBML went up by 7.7 per cent in 2006-07, downfrom 11.6 per cent in 2005-06 while the foreigncurrency component of deposits included in BMLrose by 14.0 per cent in contrast to a fall of 7.9 percent a year ago.

Narrow Money Liabilities (NML), whichcomprises currency with public and rupeetransferable deposits, increased by Rs3,763 million,from Rs36,338 million at the end of June 2006 toRs40,101 million at the end of June 2007, or 10.4per cent, lower than the rise of 11.1 per centregistered in 2005-06.

The increase of 8.6 per cent in BML in2006-07 resulted from positive contributions of 9.6percentage points in net foreign assets ofdepository corporations and 9.2 percentage pointsin claims on other sectors. Net claims on budgetarycentral government and net other items exertednegative contributions of 3.2 percentage points and7.0 percentage points, respectively. In 2005-06,the 6.7 per cent increase in BML was brought aboutby positive contributions of 11.6 percentage pointsfrom claims on other sectors and 2.4 percentagepoints from net claims on budgetary centralGovernment. Net foreign assets of depositorycorporations and net other items exerted negativecontributions of 0.3 percentage points and 7.0percentage points, respectively.

As a percentage of GDP at market prices,average BML declined from 97.2 per cent in 2005-06 to 94.7 per cent in 2006-07, average NML fellfrom 17.7 per cent in 2005-06 to 17.4 per cent in2006-07 while average domestic claims fell from96.0 per cent to 93.7 per cent. Average Claims onOther Sectors rose from 72.8 per cent in 2005-06to 73.3 per cent in 2006-07.

Table III.1 shows the DepositoryCorporations Survey as at end-June 2003 throughend-June 2007.

BOM_AR pg 1-118_06/08 6/8/08 09:57 Page 32

33

Annual Report 2006-07 Money and Banking

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170.

888

.0-1

20.7

-33.

1-6

.1-2

.5Ot

her D

epos

itory

Cor

pora

tions

108,

017.

411

5,81

9.2

128,

018.

014

9,81

7.2

167,

969.

27,

801.

97.

212

,198

.810

.521

,799

.217

.018

,152

.012

.1Ba

nks

94,5

99.3

100,

701.

910

8,54

2.6

125,

975.

214

1,68

6.9

6,10

2.5

6.5

7,84

0.7

7.8

17,4

32.6

16.1

15,7

11.7

12.5

Non-

Bank

Dep

osit-

Takin

g In

stitu

tions

13,4

18.0

15,1

17.3

19,4

75.4

23,8

42.0

26,2

82.3

1,69

9.3

12.7

4,35

8.1

28.8

4,36

6.6

22.4

2,44

0.3

10.2

3. A

SSET

S =

LIAB

ILIT

IES

182,

395.

120

9,79

7.6

237,

328.

326

2,80

7.8

293,

604.

427

,402

.515

.027

,530

.713

.125

,479

.510

.730

,796

.611

.7

4. B

road

Mon

ey L

iabilit

ies13

8,27

2.8

163,

570.

018

5,86

9.7

198,

414.

721

5,40

7.8

25,2

97.1

18.3

22,2

99.7

13.6

12,5

45.0

6.7

16,9

93.1

8.6

A. C

urre

ncy

with

Pub

lic7,

423.

28,

399.

79,

648.

910

,432

.011

,597

.397

6.5

13.2

1,24

9.2

14.9

783.

28.

11,

165.

311

.2B.

Tra

nsfe

rabl

e De

posit

s25

,867

.831

,602

.638

,408

.835

,935

.042

,148

.65,

734.

822

.26,

806.

321

.5-2

,473

.9-6

.46,

213.

617

.3Ba

nk o

f Mau

ritiu

s89

.119

.026

7.2

435.

764

3.4

-70.

1-7

8.7

248.

21,

304.

5 16

8.5

63.1

20

7.6

47.7

Othe

r Dep

osito

ry C

orpo

ratio

ns25

,778

.731

,583

.538

,141

.635

,499

.241

,505

.25,

804.

922

.56,

558.

120

.8-2

,642

.4-6

.96,

006.

016

.9Ba

nks

25,7

78.7

31,5

83.3

38,1

41.6

35,4

99.2

41,5

05.2

5,80

4.6

22.5

6,55

8.4

20.8

-2,6

42.4

-6.9

6,00

6.0

16.9

Non-

Bank

Dep

osit-

Takin

g In

stitu

tions

0.0

0.3

0.0

0.0

0.0

0.3

0.0

-0.3

-100

.00.

00.

00.

00.

0C.

Sav

ings

Dep

osits

44,1

85.7

51,6

00.9

56,7

37.3

60,9

30.7

65,3

44.0

7,41

5.2

16.8

5,13

6.4

10.0

4,19

3.4

7.4

4,41

3.3

7.2

Bank

of M

aurit

ius

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

Othe

r Dep

osito

ry C

orpo

ratio

ns44

,185

.751

,600

.956

,737

.360

,930

.765

,344

.07,

415.

216

.85,

136.

410

.04,

193.

47.

44,

413.

37.

2Ba

nks

42,4

86.4

50,6

19.1

55,6

81.1

59,8

22.0

64,2

24.1

8,13

2.7

19.1

5,06

1.9

10.0

4,14

1.0

7.4

4,40

2.1

7.4

Non-

Bank

Dep

osit-

Takin

g In

stitu

tions

1,69

9.2

981.

81,

056.

21,

108.

71,

119.

8-7

17.5

-42.

274

.57.

652

.55.

011

.11.

0D.

Tim

e De

posit

s60

,730

.868

,480

.077

,574

.988

,670

.794

,478

.07,

749.

212

.89,

094.

813

.311

,095

.814

.35,

807.

26.

5Ba

nk o

f Mau

ritiu

s25

8.7

260.

229

9.6

283.

820

5.3

1.5

0.6

39.3

15.1

-15.

8-5

.3-7

8.5

-27.

6Ot

her D

epos

itory

Cor

pora

tions

60,4

72.0

68,2

19.8

77,2

75.3

88,3

86.9

94,2

72.6

7,74

7.8

12.8

9,05

5.5

13.3

11,1

11.6

14.4

5,88

5.7

6.7

Bank

s51

,824

.456

,465

.162

,532

.470

,195

.775

,787

.04,

640.

79.

06,

067.

310

.77,

663.

312

.35,

591.

38.

0No

n-Ba

nk D

epos

it-Ta

king

Insti

tutio

ns8,

647.

611

,754

.714

,742

.918

,191

.218

,485

.63,

107.

135

.92,

988.

225

.43,

448.

323

.429

4.4

1.6

E. S

ecur

ities

oth

er th

an S

hare

s65

.33,

486.

83,

499.

82,

446.

31,

840.

03,

421.

452

35.6

13.1

0.4

-1,0

53.6

-30.

1-6

06.3

-24.

8Ba

nk o

f Mau

ritiu

s0.

03,

347.

33,

268.

31,

416.

364

7.9

3,34

7.3

0.0

-79.

0-2

.4-1

,852

.0-5

6.7

-768

.4-5

4.3

Othe

r Dep

osito

ry C

orpo

ratio

ns65

.313

9.5

231.

61,

030.

01,

192.

174

.111

3.4

92.1

66.0

798.

434

4.8

162.

115

.7Ba

nks

0.0

0.0

0.0

674.

372

7.4

0.0

0.0

0.0

0.0

674.

30.

053

.17.

9No

n-Ba

nk D

epos

it-Ta

king

Insti

tutio

ns65

.313

9.5

231.

635

5.7

464.

774

.111

3.4

92.1

66.0

124.

253

.610

9.0

30.6

5. O

ther

44

,122

.346

,227

.751

,458

.664

,393

.178

,196

.52,

105.

44.

85,

230.

911

.312

,934

.525

.113

,803

.521

.4

Figu

res

may

not

add

up

to to

tals

due

to ro

undi

ng.

Jun-

03Ju

n-04

Jun-

05Ju

n-06

Jun-

07C

hang

e B

etw

een

Cha

nge

Bet

wee

nC

hang

e B

etw

een

Cha

nge

Bet

wee

n

(1)

(2)

(3)

(4)

(5)

(1) a

nd (2

)(2

) and

(3)

(3) a

nd (4

)(4

) and

(5)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Per

cen

t)(R

s M

n)(P

er c

ent)

(Rs

Mn)

(Per

cen

t)(R

s M

n)(P

er c

ent)

Tabl

e III

.1: D

epos

itory

Cor

pora

tions

Sur

vey

BOM_AR pg 1-118_06/08 6/8/08 09:57 Page 33

34


Trends in Monetary Base and MonetaryRatios

The monthly average level of the monetarybase went up from Rs20,701 million in 2005-06to Rs22,362 million in 2006-07, or 8.0 per cent,compared to an increase of 15.0 per cent in2005-06. The monthly average level of broadmoney liabilities rose from Rs189,215 million toRs207,122 million, or 9.5 per cent, between end-June 2006 and end-June 2007, up from 7.4 percent in 2005-06. Consequently, the averagemultiplier for broad money liabilities increasedfrom 9.1 in 2005-06 to 9.3 in 2006-07.

On an average basis and as a ratio of broadmoney liabilities, currency with public remained

unchanged at 5.5 per cent in both 2005-06 and2006-07; transferable deposits rose from 18.1 percent to 18.9 per cent; savings deposits fell from31.6 per cent to 30.6 per cent; time depositsimproved from 43.5 per cent to 44.2 per cent; andsecurities other than shares included in broadmoney fell from 1.3 per cent to 0.8 per cent overthe same period.

The income velocity of circulation of broadmoney liabilities rose from 1.03 in 2005-06 to 1.06in 2006-07. Table III.2a gives details on monetaryratios for the years ended June 2004 through June2007 and Table III.2b gives details on the incomevelocity of circulation for the years 2003-04through 2006-07.

1. Monthly Average for year ended (Rs million)

A. Monetary Base 16,089 17,997 20,701 22,362

(+11.9) (+15.0) (+8.0)

B. Broad Money Liabilities (BML) 150,151 176,219 189,215 207,122

(+17.4) (+7.4) (+9.5)

(a) Currency with public 8,188 9,479 10,445 11,447

(+15.8) (+10.2) (+9.6)

(b) Transferable deposits 27,728 34,076 34,272 39,063

(+22.9) (+0.6) (+14.0)

(c ) Savings deposits 48,013 54,464 59,782 63,303

(+13.4) (+9.8) (+5.9)

(d) Time deposits 63,787 74,559 82,223 91,568

(+16.9) (+10.3) (+11.4)

(e) Securities other than shares included in 2,434 3,641 2,494 1,742

broad money (+49.6) (-31.5) (-30.2)

2. Average Broad Money Multiplier 9.3 9.8 9.1 9.3

3. Other Monetary Ratios (Per cent)

A. Currency to BML 5.5 5.4 5.5 5.5

B. Transferable Deposits to BML 18.5 19.3 18.1 18.9

C. Savings deposits to BML 32.0 30.9 31.6 30.6

D. Time Deposits to BML 42.5 42.3 43.5 44.2

E. Securities other than shares inc. in broad 1.6 2.1 1.3 0.8

money to BML

Table III.2a: Monetary Ratios

Jun-04 Jun-05 Jun-06 Jun-07

Notes : (i) Figures in brackets represent percentage change over previous period.(ii) The average Broad Money Multiplier is defined as the ratio of average Broad Money Liabilities to

average Monetary Base.

BOM_AR pg 1-118_06/08 6/8/08 09:57 Page 34

35


2003-04 20.3 6.1 1.1

2004-05 19.0 5.7 1.0

2005-06 18.6 5.6 1.0

2006-07 19.1 5.8 1.1

Income Income IncomeVelocity of Velocity of Velocity of

Circulation of Circulation of Circulation ofCurrency Narrow Money Liabilities Broad Money Liabilities

Table III.2b: Income Velocity of Circulation of Money

Central Bank Survey

The Central Bank Survey (CBS), which is onecomponent survey of the DCS, shows thecomponents of the monetary base. The monetarybase consists of central bank liabilities that supportthe expansion of broad money and credit.

The monetary base expanded by Rs1,826million, or 8.3 per cent, from Rs22,015 million atthe end of June 2006 to Rs23,841 million at the endof June 2007, as against an expansion of 19.2 percent in 2005-06. Of its major components, currencyin circulation rose by 10.3 per cent compared to anincrease of 2.6 per cent in 2005-06 and reservedeposits increased by 4.8 per cent as against anincrease of 51.5 per cent in 2005-06.

On the sources side of the monetary base, netforeign assets of the Bank increased by Rs9,908million, or 23.4 per cent, from Rs42,315 million atthe end of June 2006 to Rs52,223 million at the endof June 2007 compared to a decline of 0.6 per centin the previous fiscal year. Domestic claims by theBank contracted by Rs2,559 million, or 82.7 percent, to Rs535 million at the end of June 2007, asagainst an increase of 26.8 per cent in 2005-06.

Table III.3 shows the Central Bank Survey asat end-June 2003 through end-June 2007.

Other Depository Corporations Survey

The Other Depository Corporations Survey(ODCS) is the other component survey of the DCSand covers all institutional units that issue liabilitiesincluded in the national definition of broad money.

Net foreign assets of ODCs grew by Rs9,051million, or 41.4 per cent, from Rs21,888 million atthe end of June 2006 to Rs30,939 million at the endof June 2007, compared to a slight decrease of 1.6per cent in 2005-06.

Domestic claims rose by Rs16,897 million, or8.0 per cent, from Rs210,931 million at the end ofJune 2006 to Rs227,828 million at the end of June2007, compared to a growth of 13.4 per cent in thepreceding fiscal year. Of the components ofdomestic claims, net claims on Central Governmentdecreased by 8.2 per cent as against the rise of 8.1per cent recorded in 2005-06. Claims on othersectors grew by 12.1 per cent, lower than theincrease of 17.0 per cent in 2005-06. Claims on thecentral bank rose by 19.3 per cent, compared to acontraction of 3.3 per cent in 2006-07. Claims onGBL Holders went up by 14.0 per cent, lower thanthe growth of 18.8 per cent registered in 2005-06.

Deposits included in broad money grew byRs16,305 million, or 8.8 per cent, from Rs184,817million at the end of June 2006 to Rs201,122million at the end of June 2007, higher than the riseof 7.4 per cent recorded during the previous fiscalyear. Securities other than shares included in BroadMoney went up by Rs162 million, from Rs1,030million at the end of June 2006 to Rs1,192 millionat the end of June 2007, or 15.7 per cent, muchlower than the expansion of 344.8 per centregistered in the preceding fiscal year.

Table III.4 presents the Other DepositoryCorporations Survey as at end-June 2003 throughend-June 2007.Banks Survey

Banks Survey

The total assets (liabilities) of banks grew byRs24,280 million, or 11.5 per cent, from Rs210,663million at the end of June 2006 to Rs234,943million at the end of June 2007, marginally higherthan the rise of 11.4 per cent noted in the previousfiscal year.

BOM_AR pg 1-118_06/08 6/8/08 09:57 Page 35

36


1. Ne

t For

eign A

ssets

39,42

4.743

,117.5

42,57

1.142

,314.6

52,22

2.73,6

92.8

9.4-5

46.3

-1.3

-256

.6-0

.69,9

08.1

23.4

Claim

s on N

onres

idents

39,58

3.743

,342.7

42,73

4.442

,458.6

52,77

2.13,7

59.0

9.5-6

08.3

-1.4

-275

.8-0

.610

,313.5

24.3

Liabil

ities t

o Non

reside

nts15

9.022

5.216

3.314

4.054

9.466

.241

.7-6

1.9-2

7.5-1

9.2-1

1.840

5.428

1.5

2. Do

mes

tic C

laim

s-1

0,072

.42,0

17.6

2,440

.43,0

93.8

534.7

12,09

0.0-1

20.0

422.8

21.0

653.4

26.8

-2,55

9.1-8

2.7

A. Ne

t Clai

ms on

Budg

etary

Centr

al Go

vernm

ent

-12,4

09.7

-739

.813

7.61,0

11.2

-1,41

7.311

,669.8

-94.0

877.5

-118

.687

3.563

4.8-2

,428.5

-240

.2

B. Cl

aims o

n Othe

r Sec

tors

106.8

194.1

364.8

244.1

238.1

87.3

81.7

170.8

88.0

-120

.7-3

3.1-6

.1-2

.5

C. C

laims

on O

ther D

epos

itory

Corpo

ration

s2,2

30.5

2,563

.41,9

37.9

1,838

.51,7

14.0

332.9

14.9

-625

.4-2

4.4-9

9.4-5

.1-1

24.5

-6.8

3. AS

SETS

= LI

ABIL

ITIE

S29

,352.3

45,13

5.145

,011.5

45,40

8.452

,757.4

15,78

2.853

.8-1

23.5

-0.3

396.9

0.97,3

49.0

16.2

4. M

oneta

ry B

ase

14,86

7.217

,387.7

18,47

5.722

,015.3

23,84

0.92,5

20.5

17.0

1,088

.06.3

3,539

.619

.21,8

25.6

8.3

A. Cu

rrenc

y in C

ircula

tion

9,527

.310

,786.2

11,93

7.312

,248.1

13,51

1.81,2

58.9

13.2

1,151

.210

.731

0.72.6

1,263

.810

.3

B. Lia

bilitie

s to O

ther D

epos

itory

Corpo

ration

s4,9

92.0

6,322

.35,9

71.6

9,047

.79,4

80.3

1,330

.326

.6-3

50.7

-5.5

3,076

.151

.543

2.64.8

C. D

epos

its In

clude

d in B

road M

oney

347.9

279.3

566.8

719.5

848.7

-68.6

-19.7

287.5

102.9

152.8

27.0

129.2

18.0

5. Se

curit

ies ot

her t

han S

hares

Inclu

ded i

n Bro

ad M

oney

0.03,3

47.3

3,268

.31,4

16.3

647.9

3,347

.30.0

-79.0

-2.4

-1,85

2.0-5

6.7-7

68.4

-54.3

6. Ot

her

14,48

5.124

,400.0

23,26

7.621

,976.8

28,26

8.79,9

14.9

68.4

-1,13

2.4-4

.6-1

,290.8

-5.5

6,291

.928

.6

Figu

res

may

not

add

up

to to

tals

due

to ro

undi

ng.

Jun-

03Ju

n-04

Jun-

05Ju

n-06

Jun-

07C

hang

e B

etw

een

Cha

nge

Bet

wee

nC

hang

e B

etw

een

Cha

nge

Bet

wee

n

(1)

(2)

(3)

(4)

(5)

(1) a

nd (2

)(2

) and

(3)

(3) a

nd (4

)(4

) and

(5)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Per

cen

t)(R

s M

n)(P

er c

ent)

(Rs

Mn)

(Per

cen

t)(R

s M

n)(P

er c

ent)

Tabl

e III

.3: C

entra

l Ban

k Su

rvey


37


1. Ne

t For

eign

Asse

ts9,9

66.8

10,72

8.422

,254.3

21,88

7.630

,938.9

761.6

7.611

,525.9

107.4

-366

.8-1

.69,0

51.3

41.4

Claim

s on N

onres

idents

116,3

71.9

146,0

89.5

168,6

40.1

202,6

68.5

267,2

22.7

29,71

7.625

.522

,550.6

15.4

34,02

8.420

.264

,554.2

31.9

Liabil

ities t

o Non

reside

nts10

6,405

.113

5,361

.114

6,385

.818

0,780

.923

6,283

.928

,956.0

27.2

11,02

4.78.1

34,39

5.123

.555

,502.9

30.7

2. Do

mes

tic C

laim

s15

2,408

.717

4,661

.418

6,051

.521

0,931

.222

7,828

.322

,252.7

14.6

11,39

0.16.5

24,87

9.713

.416

,897.1

8.0

A. N

et Cl

aims o

n Cen

tral G

overn

ment

37,28

9.140

,678.3

43,98

2.347

,533.1

43,65

2.83,3

89.2

9.13,3

04.0

8.13,5

50.8

8.1-3

,880.3

-8.2

B. C

laims

on O

ther S

ector

s10

8,017

.411

5,819

.212

8,018

.014

9,817

.216

7,969

.27,8

01.9

7.212

,198.8

10.5

21,79

9.217

.018

,152.0

12.1

C. C

laims

on C

entra

l Ban

k7,1

02.2

18,16

3.914

,051.1

13,58

0.916

,206.2

11,06

1.615

5.7-4

,112.7

-22.6

-470

.2-3

.32,6

25.3

19.3

3. Cl

aims o

n Gl

obal

Busin

ess L

icenc

e Hold

ers S

ecto

r9,9

16.7

10,84

8.17,4

98.0

8,907

.110

,158.2

931.4

9.4-3

,350.2

-30.9

1,409

.118

.81,2

51.1

14.0

4. AS

SETS

= L

IABI

LITI

ES17

2,292

.319

6,238

.021

5,803

.824

1,725

.926

8,925

.323

,945.7

13.9

19,56

5.810

.025

,922.1

12.0

27,19

9.411

.3

5. Lia

bilitie

s to

Cent

ral B

ank

2,232

.62,5

17.3

1,848

.91,7

00.2

1,368

.528

4.712

.8-6

68.4

-26.6

-148

.7-8

.0-3

31.7

-19.5

6. De

posit

s Inc

luded

in B

road

Mon

ey13

0,436

.415

1,404

.217

2,154

.218

4,816

.920

1,121

.820

,967.8

16.1

20,75

0.013

.712

,662.7

7.416

,304.9

8.8

A. Tr

ansfe

rable

Depo

sits

25,77

8.731

,583.5

38,14

1.635

,499.2

41,50

5.25,8

04.9

22.5

6,558

.120

.8-2

,642.4

-6.9

6,006

.016

.9

B. S

aving

s Dep

osits

44,18

5.751

,600.9

56,73

7.360

,930.7

65,34

4.07,4

15.2

16.8

5,136

.410

.04,1

93.4

7.44,4

13.3

7.2

C. Ti

me D

epos

its60

,472.0

68,21

9.877

,275.3

88,38

6.994

,272.6

7,747

.812

.89,0

55.5

13.3

11,11

1.614

.45,8

85.7

6.7

7. Se

curit

ies ot

her t

han S

hares

inclu

ded i

n Bro

ad M

oney

65.3

139.5

231.6

1,030

.01,1

92.1

74.1

113.4

92.1

66.0

798.4

344.8

162.1

15.7

8. Ot

her

39,55

7.942

,177.0

41,56

9.154

,178.8

65,24

2.92,6

19.1

6.6-6

07.9

-1.4

12,60

9.730

.311

,064.1

20.4

Jun-

03Ju

n-04

Jun-

05Ju

n-06

Jun-

07C

hang

e B

etw

een

Cha

nge

Bet

wee

nC

hang

e B

etw

een

Cha

nge

Bet

wee

n

(1)

(2)

(3)

(4)

(5)

(1) a

nd (2

)(2

) and

(3)

(3) a

nd (4

)(4

) and

(5)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Per

cen

t)(R

s M

n)(P

er c

ent)

(Rs

Mn)

(Per

cen

t)(R

s M

n)(P

er c

ent)

Tabl

e III

.4: O

ther

Dep

osito

ry C

orpo

ratio

ns S

urve

y

Figu

res

may

not

add

up

to to

tals

due

to ro

undi

ng.

BOM_AR pg 1-118_06/08 6/8/08 09:59 Page 37

38


Table III.5 shows the Banks Survey as at end-June 2003 through end-June 2007.

Non-Bank Deposit-Taking Institutions’Survey

Total assets (liabilities) of non-bank deposit-taking institutions expanded by Rs2,386 million, or8.4 per cent, from Rs28,258 million at the end ofJune 2006 to Rs30,644 million at the end of June2007, compared to a much higher increase of 17.1per cent in the preceding fiscal year.

Table III.6 shows the Non-Bank Deposit-Taking Institutions Survey as at end-June 2003through end-June 2007.

BANKING SECTOR

Main Features

At the end of June 2007, the banking sector inMauritius comprised nineteen banks that arelicensed to carry out banking business. Of these,four are locally incorporated; ten are foreign-ownedbanks incorporated locally while five are branchesof foreign banks. HSBC Bank (Mauritius) Limitedstarted its operations as from 1 August 2006,although it was granted a banking licence on 8 June2006. SBM Nedbank International Limited ceasedall its banking operations as from 28 February2007, implying that at the end of June 2007 therewere eighteen active banks in Mauritius.

In total, these banks were operating 178branches, 12 counters, 1 mobile van and 334Automated Teller Machines (ATMs) in Mauritius andwere employing 5,253 people at the end of June2007. The number of inhabitants per branch wentdown from 7,241 as at end-June 2006 to 7,081 asat end-June 2007. Besides traditional bankingfacilities, ten banks offer card-based paymentservices such as credit and debit cards while eightbanks provide internet banking and three banksprovide phone banking facilities. Between end-June 2006 and end-June 2007, the number of cardsin circulation fell by 6,253, from 1,038,089 to1,031,836, with the number of credit cards fallingby 30,844 and debit and other cards risingby 24,591.

The average balance per account for demand,savings, time and foreign currency deposits stood

at Rs142,936, Rs44,398, Rs522,799 andRs5,477,551 million at the end of June 2007compared to Rs148,183, Rs41,532, Rs492,480 andRs4,467,937 million at the end of June 2006.

Sectorwise Distribution of Credit

Credit extended to the private sector by banksgrew by Rs11,910 million, or 10.0 per cent, fromRs119,471 million at the end of June 2006 toRs131,381 million at the end of June 2007,compared to an increase of 13.7 per cent registeredover the preceding fiscal year. Average privatesector credit as a percentage of GDP at marketprices went up from 58.3 per cent in 2005-06 to58.8 per cent in 2006-07. The “Construction” sectorwith a share of around 28.9 per cent of theadditional credit extended in 2006-07, was thedominant source of growth. The” “Tourism”,“Financial and Business Services” and “Traders”sectors were the other major recipients ofadditional credit with around 59.0 per cent of theincrease channeled towards them. Credit to thehousehold sector remained buoyant with anincrease of Rs4,100 million or 15.7 per cent in2006-07. Its share of average credit to GDP atmarket prices stood at 12.8 per cent in 2006-07, upfrom 12.6 per cent a year earlier.

Loans and overdrafts facilities went up byRs12,798 million, or 13.8 per cent, to Rs105,627million at the end of June 2007, lower than theincrease of 15.1 per cent noted in 2005-06. Theyrepresented 80.4 per cent of total credit at the endof June 2007, up from 77.7 per cent at the end ofJune 2006. Foreign currency financing of credit fellby Rs1,611 million, or 10.6 per cent, to Rs13,526million at the end of June 2007, in contrast to anincrease of 13.0 per cent in 2005-06. The share offoreign currency lending out of total credit fell to10.3 per cent at the end of June 2007 from 12.7per cent at the end of June 2006. Local BillsPurchased and Discounted edged down by Rs6.0million, or 0.6 per cent, to Rs1,100 million,compared to fall of 1.0 per cent recorded in thepreceding fiscal year. As a share of total credit,they accounted for 0.8 per cent at the end of June2007, marginally lower than the share of 0.9 percent at the end of June 2006. Bills Receivabledeclined by Rs126 million, or 5.3 per cent toRs2,227 million compared to a fall of 0.3 per centregistered in 2005-06. Their share in total credit


39


1. Ne

t For

eign A

ssets

9,991

.110

,780.0

22,30

8.521

,909.4

30,97

8.278

8.97.9

11,52

8.510

6.9-3

99.1

-1.8

9,068

.841

.4

Claim

s on N

onres

idents

116,3

67.2

146,0

89.5

168,6

40.1

202,6

68.5

267,2

22.5

29,72

2.325

.522

,550.6

15.4

34,02

8.420

.264

,554.0

31.9

Liabil

ities t

o Non

reside

nts10

6,376

.113

5,309

.514

6,331

.618

0,759

.023

6,244

.328

,933.4

27.2

11,02

2.18.1

34,42

7.423

.555

,485.3

30.7

2. Do

mes

tic C

laim

s13

7,572

.415

9,841

.916

6,870

.518

8,753

.320

3,964

.722

,269.6

16.2

7,028

.54.4

21,88

2.813

.115

,211.5

8.1

A. Ne

t Clai

ms on

Cen

tral G

overn

ment

34,36

9.438

,582.7

41,91

5.945

,728.6

41,51

7.14,2

13.4

12.3

3,333

.28.6

3,812

.69.1

-4,21

1.4-9

.2

B. Cl

aims o

n Othe

r Sec

tors

94,59

9.310

0,701

.910

8,542

.612

5,975

.214

1,686

.96,1

02.5

6.57,8

40.7

7.817

,432.6

16.1

15,71

1.712

.5

C. C

laims

on C

entra

l Ban

k7,0

98.2

17,44

7.213

,219.3

13,44

4.116

,157.2

10,34

9.014

5.8-4

,227.9

-24.2

224.8

1.72,7

13.1

20.2

D. C

laims

on N

onBa

nk D

epos

it-Tak

ing In

stitut

ions

1,505

.53,1

10.2

3,192

.63,6

05.4

4,603

.51,6

04.7

106.6

82.4

2.741

2.812

.999

8.127

.7

3. AS

SETS

= LI

ABIL

ITIE

S14

7,563

.417

0,621

.918

9,179

.021

0,662

.723

4,942

.923

,058.5

15.6

18,55

7.110

.921

,483.7

11.4

24,28

0.211

.5

4. Lia

bilitie

s to C

entra

l Ban

k2,1

72.9

2,487

.61,8

26.5

1,681

.01,3

51.7

314.7

14.5

-661

.1-2

6.6-1

45.5

-8.0

-329

.3-1

9.6

5. De

posit

s Inc

luded

in B

road

Mon

ey12

0,089

.513

8,667

.515

6,355

.116

5,517

.018

1,516

.418

,578.0

15.5

17,68

7.612

.89,1

61.9

5.915

,999.4

9.7

A. Tra

nsfer

able

Depo

sits

25,77

8.731

,583.3

38,14

1.635

,499.2

41,50

5.25,8

04.6

22.5

6,558

.320

.8-2

,642.4

-6.9

6,006

.016

.9

B. Sa

vings

Dep

osits

42,48

6.450

,619.1

55,68

1.159

,822.0

64,22

4.18,1

32.7

19.1

5,062

.010

.04,1

41.0

7.44,4

02.1

7.4

C. Ti

me D

epos

its51

,824.4

56,46

5.162

,532.4

70,19

5.775

,787.0

4,640

.79.0

6,067

.310

.77,6

63.3

12.3

5,591

.38.0

6. Se

curit

ies ot

her t

han S

hares

inclu

ded i

n Bro

ad M

oney

0.00.0

0.067

4.372

7.40.0

0.00.0

0.067

4.30.0

53.1

7.9

7. Lia

bilitie

s to N

onBa

nk D

epos

it-Ta

king I

nstit

ution

s1,4

94.7

1,787

.11,6

23.1

2,409

.62,0

81.0

292.5

19.6

-164

.0-9

.278

6.548

.5-3

28.6

-13.6

7. Ot

her

23,80

6.327

,679.6

29,37

4.240

,380.8

49,26

6.33,8

73.3

16.3

1,694

.56.1

11,00

6.637

.58,8

85.6

22.0

Jun-

03Ju

n-04

Jun-

05Ju

n-06

Jun-

07C

hang

e B

etw

een

Cha

nge

Bet

wee

nC

hang

e B

etw

een

Cha

nge

Bet

wee

n

(1)

(2)

(3)

(4)

(5)

(1) a

nd (2

)(2

) and

(3)

(3) a

nd (4

)(4

) and

(5)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Per

cen

t)(R

s M

n)(P

er c

ent)

(Rs

Mn)

(Per

cen

t)(R

s M

n)(P

er c

ent)

Tabl

e III

.5: B

anks

Sur

vey

Figu

res

may

not

add

up

to to

tals

due

to ro

undi

ng.


40


1. Ne

t For

eign A

ssets

-24.2

-51.6

-54.2

-21.9

-39.3

-27.3

112.7

-2.6

5.032

.3-5

9.6-1

7.580

.0

Claim

s on N

onres

idents

4.80.0

0.00.0

0.2-4

.7-1

00.0

0.00.0

0.00.0

0.20.0

Liabil

ities t

o Non

reside

nts29

.051

.654

.221

.939

.522

.677

.92.6

5.0-3

2.3-5

9.617

.780

.9

2. Do

mes

tic C

laim

s18

,308.8

20,12

9.724

,176.6

28,28

0.130

,683.6

1,820

.89.9

4,046

.920

.14,1

03.5

17.0

2,403

.58.5

A. Ne

t Clai

ms on

Cen

tral G

overn

ment

2,919

.72,0

95.6

2,066

.41,8

04.5

2,135

.7-8

24.2

-28.2

-29.2

-1.4

-261

.9-1

2.733

1.218

.4

B. Cl

aims o

n Othe

r Sec

tors

13,41

8.015

,117.3

19,47

5.423

,842.0

26,28

2.31,6

99.3

12.7

4,358

.128

.84,3

66.6

22.4

2,440

.310

.2

C. C

laims

on C

entra

l Ban

k4.1

716.7

831.8

136.8

49.0

712.6

1750

0.511

5.116

.1-6

95.0

-83.6

-87.8

-64.2

D. C

laims

on Ba

nks

1,967

.02,2

00.1

1,803

.02,4

96.8

2,216

.623

3.111

.8-3

97.1

-18.0

693.8

38.5

-280

.2-1

1.2

3. AS

SETS

= LI

ABIL

ITIE

S18

,284.6

20,07

8.124

,122.5

28,25

8.230

,644.3

1,793

.59.8

4,044

.420

.14,1

35.8

17.1

2,386

.08.4

4. Lia

bilitie

s to C

entra

l Ban

k59

.729

.722

.419

.216

.7-3

0.0-5

0.3-7

.3-2

4.7-3

.2-1

4.2-2

.5-1

2.8

5. De

posit

s Inc

luded

in B

road

Mon

ey10

,346.8

12,73

6.715

,799.1

19,29

9.919

,605.4

2,389

.823

.13,0

62.5

24.0

3,500

.822

.230

5.51.6

A. Tra

nsfer

able

Depo

sits

0.00.3

0.00.0

0.00.3

0.0-0

.3-1

00.0

0.00.0

0.00.0

B. Sa

vings

Dep

osits

1,699

.298

1.81,0

56.2

1,108

.71,1

19.8

-717

.5-4

2.274

.57.6

52.5

5.011

.11.0

C. Ti

me D

epos

its8,6

47.6

11,75

4.714

,742.9

18,19

1.218

,485.6

3,107

.135

.92,9

88.2

25.4

3,448

.323

.429

4.41.6

6. Se

curit

ies ot

her t

han S

hare

s inc

luded

in B

road

Mon

ey65

.313

9.523

1.635

5.746

4.774

.111

3.492

.166

.012

4.253

.610

9.030

.6

7. Lia

bilitie

s to B

anks

1,769

.33,2

12.6

2,864

.83,3

02.7

4,646

.11,4

43.4

81.6

-347

.8-1

0.843

7.915

.31,3

43.4

40.7

8. Ot

her

6,043

.43,9

59.6

5,204

.65,2

80.7

5,911

.3-2

,083.8

-34.5

1,245

.031

.476

.21.5

630.6

11.9

Jun-

03Ju

n-04

Jun-

05Ju

n-06

Jun-

07C

hang

e B

etw

een

Cha

nge

Bet

wee

nC

hang

e B

etw

een

Cha

nge

Bet

wee

n

(1)

(2)

(3)

(4)

(5)

(1) a

nd (2

)(2

) and

(3)

(3) a

nd (4

)(4

) and

(5)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Rs

Mn)

(Per

cen

t)(R

s M

n)(P

er c

ent)

(Rs

Mn)

(Per

cen

t)(R

s M

n)(P

er c

ent)

Tabl

e III

.6: N

on-B

ank

Dep

osit-

Taki

ng In

stitu

tions

’Sur

vey

Figu

res

may

not

add

up

to to

tals

due

to ro

undi

ng.


41


was 1.7 per cent at the end of June 2007 comparedto 2.0 per cent at the end of June 2006. Banks’investment in shares and debentures grew by 10.6per cent, from Rs8,047 million at the end of June2006 to Rs8,901 million at the end of June 2007,compared to an increase of 6.9 per cent in thepreceding fiscal year. As a percentage of totalcredit, they represented 6.8 per cent as at end-June 2007, slightly higher than the share of 6.7 percent as at end-June 2006.

Chart III.1 shows the sectorwise contributionto the increase in credit to the private sector bybanks in 2006-07. Table III.7 gives the breakdownof the sectorwise distribution of credit to the privatesector by banks as at end-June 2005, end-June2006 and end-June 2007.

Maintenance of Cash Ratio

With effect from the week starting 6 January2006, the cash ratio that banks are required tomaintain was set at 4.0 per cent. The minimumcash balances held by banks was to be maintainedexclusively in the form of balances held by bankswith the Bank of Mauritius. Moreover, themaintenance period for cash ratio purposes waslengthened from one week to two weeks as from 19January 2007. Thus, banks were required tomaintain two-week average reserve balances at theBank equivalent to a minimum of 4.0 per cent oftheir average deposit liabilities held over the two-week period preceding the maintenance period.Further, on any particular day during themaintenance period, the minimum cash reserveratio was not to fall below 2.0 per cent of averagedeposit liabilities.

Table III.8 gives details of the average cash ratiomaintained by banks in 2005-06 and in 2006-07.

INTEREST RATES

Banks adjusted their interest rate structuremore or less in line with the changes in theLombard Rate. After the 50 basis points hike in theLombard Rate in July 2006, banks adjusted theirprime lending rate from a range of 9.20-10.25 percent in June 2006 to a range of 9.70-10.75 per centin July 2006. Following the hike of 100 basis pointsin Lombard Rate on 11 September 2006, banksadjusted their prime lending rate upward to a rangeof 10.70-11.75 per cent, which remainedunchanged up till the end of fiscal year 2006-07.Interest rates charged by banks on loans andadvances moved from a range of 6.25-22.50 percent in June 2006 to a range of 6.25-24.00 inJune 2007.

Interest paid by banks on savings depositswent up from a range of 5.70-6.27 per cent in June2006 to a range of 6.20-6.80 per cent in July 2006,following the hike of 50 basis points in LombardRate. With a further hike of 100 basis points in theLombard Rate on 11 September 2006, savingsdeposits were paid interest in the range of 7.20-7.60 per cent for the months of September 2006through June 2007.

The modal prime lending rate went up from9.50 per cent in June 2006 to 10.00 per cent in July2006 and further to 11.00 per cent in September2006; it thereafter remained unchanged for therest of fiscal year 2006-07. The modal savingsdeposits rate increased from 6.00 per cent in June2006 to 6.50 per cent in July 2006 and further to7.50 per cent in September 2006 and stayedunchanged thereafter.

The weighted average lending rate of banksrose from 11.41 per cent in June 2006 to 12.47 percent in June 2007, while the weighted average termdeposits rate increased from 7.35 per cent to 9.46per cent. The spread between them varied between3.01 and 4.21 percentage points in 2006-07compared to a range of 4.03-4.48 percentagepoints in 2005-06.

The real rate of interest on savings depositsdeteriorated during the fiscal year 2006-07, from0.86 percentage point at the end of June 2006 tonegative 2.89 percentage points at the end of June2007.

Table III.9 gives details of the interest ratestructure of the banking sector, while Charts III.2shows the movements in the rate of inflation, the

Personal20%Tourism

21%

Financial andBusiness Services

21%

Construction29%

Others9%

Chart III.1: Sectorwise Contribution to the Increase in Credit tothe Private Sector by Banks in 2006-07

BOM_AR pg 1-118_06/08 6/8/08 09:55 Page 41

42


Agriculture & Fishing 7,345.5 7,844.4 6,851.7 498.9 6.8 -992.7 -12.7

- of which

Sugar Industry - Estates 4,370.7 5,105.4 4,129.0 734.7 16.8 -976.4 -19.1

Sugar Industry - Others 947.7 706.2 608.7 -241.5 -25.5 -97.5 -13.8

Agricultural Development Certificate Holders 14.0 17.2 17.5 3.2 22.7 0.3 1.5

Agro-based Industrial Certificate Holders 19.4 14.1 13.5 -5.3 -27.3 -0.6 -4.1

Sugarcane Planters 680.7 626.0 708.2 -54.7 -8.0 82.1 13.1

Other Plantation 57.8 48.0 52.7 -9.8 -16.9 4.7 9.8

Animal Breeding 736.6 684.4 606.7 -52.2 -7.1 -77.7 -11.3

Fishing 125.0 84.3 203.4 -40.7 -32.5 119.1 141.3

Other 393.5 558.7 511.9 165.2 42.0 -46.8 -8.4

Manufacturing 14,397.7 14,975.8 14,944.9 578.1 4.0 -30.9 -0.2

- of which

Export Enterprise Certificate Holders 6,421.6 6,820.5 6,548.0 399.0 6.2 -272.5 -4.0

Export Service Certificate Holders 138.9 252.0 275.6 113.1 81.5 23.6 9.4

Pioneer Status Certificate Holders 276.4 261.7 213.1 -14.8 -5.3 -48.6 -18.6

Small and Medium Enterprise Certificate Holders 104.4 89.0 107.2 -15.4 -14.7 18.1 20.4

Strategic Local Enterprise Certificate Holders 0.8 0.0 0.0 -0.8 -100.0 0.0 0.0

Furniture & Wood Products 397.4 406.8 451.6 9.4 2.4 44.8 11.0

Printing & Publishing 910.5 854.1 713.8 -56.4 -6.2 -140.3 -16.4

Steel/Metal Products 349.6 395.0 394.1 45.4 13.0 -0.9 -0.2

Food & Beverages 2,363.7 2,779.2 2,761.0 415.5 17.6 -18.2 -0.7

Plastic Products 176.6 172.6 192.4 -4.0 -2.3 19.8 11.5

Pharmaceuticals & Health Care 97.6 69.4 119.0 -28.2 -28.9 49.6 71.5

Jewellery & Precision Engineering 166.2 164.5 158.7 -1.7 -1.1 -5.8 -3.5

Electronics 107.1 89.5 118.3 -17.6 -16.4 28.8 32.2

Leather Products & Footwear 51.2 52.9 74.0 1.7 3.3 21.1 39.9

Paints 137.2 131.1 198.6 -6.1 -4.5 67.5 51.5

Cement 114.5 41.8 117.0 -72.6 -63.5 75.2 179.8

Other 2,584.1 2,395.8 2,502.6 -188.2 -7.3 106.8 4.5

Tourism 15,116.9 15,340.5 17,882.8 223.5 1.5 2,542.3 16.6

- of which

Hotels 6,444.8 6,742.9 9,077.0 298.2 4.6 2,334.1 34.6

Tour Operators & Travel Agents 468.6 497.2 466.6 28.6 6.1 -30.6 -6.2

Hotel Development Certificate Holders 1,162.9 802.3 1,062.5 -360.6 -31.0 260.2 32.4

Hotel Management Service Certificate Holders 6,302.0 6,381.2 6,511.3 79.2 1.3 130.1 2.0

Restaurants 189.7 240.5 232.9 50.8 26.8 -7.5 -3.1

Duty-Free Shops 9.1 11.8 16.8 2.7 29.7 5.0 41.9

Other 539.8 664.5 515.5 124.7 23.1 -149.0 -22.4

Transport 1,507.9 1,681.5 1,771.6 173.6 11.5 90.2 5.4

- of which

Airlines 121.2 126.4 114.0 5.3 4.3 -12.5 -9.9

Buses, Lorries, Trucks & Cars 507.5 530.1 507.5 22.5 4.4 -22.6 -4.3

Shipping & Freight Forwarders 800.7 908.9 1,011.8 108.2 13.5 102.9 11.3

Other 78.5 116.1 138.4 37.6 47.8 22.3 19.2

Jun-05 Jun-06 Jun-07 Change between Change between(1) (2) (3) (1) and (2) (2) and (3)

(Rs Mn) (Rs Mn) (Rs Mn) (Rs Mn) (Per cent) (Rs Mn) (Per cent)

Table III.7: Sectorwise Distribution of Credit to the Private Sector

Continued on next page.

BOM_AR pg 1-118_06/08 6/8/08 09:55 Page 42

43


Construction 16,990.8 19,474.9 22,917.1 2,484.1 14.6 3,442.2 17.7

- of which

Building & Housing Contractors 1,703.5 1,574.8 1,540.4 -128.7 -7.6 -34.4 -2.2

Property Development - Commercial 1,566.3 1,422.7 1,881.8 -143.5 -9.2 459.0 32.3

Property Development - Residential 365.3 373.3 1,156.8 8.1 2.2 783.5 209.9

Property Development - Land Parcelling 185.0 149.1 161.8 -35.9 -19.4 12.7 8.5

Housing 11,010.6 13,273.5 14,867.7 2,262.9 20.6 1,594.2 12.0

Housing - Staff 631.7 961.7 1,099.0 330.0 52.2 137.2 14.3

Housing Development Certificate Holders 10.0 5.3 8.4 -4.6 -46.5 3.1 57.4

Industrial Building Enterprise Certificate Holders 294.5 289.7 292.3 -4.8 -1.6 2.6 0.9

Building Supplies & Materials 0.0 0.4 67.3 0.4 0.0 66.9 0.0

Stone Crushing and Concrete Products 549.7 693.4 928.6 143.7 26.1 235.2 33.9

Other 674.2 730.8 913.0 56.6 8.4 182.2 24.9

Traders 15,534.7 17,712.5 19,736.4 2,177.8 14.0 2,023.9 11.4

- of which

Marketing Companies 0.0 0.1 0.0 0.1 0.0 0.0 0.0

Wholesalers 4,801.9 4,963.6 5,163.7 161.7 3.4 200.1 4.0

Retailers - Hypermarkets 463.6 314.9 305.7 -148.7 -32.1 -9.2 -2.9

Retailers - Supermarkets 926.7 889.1 833.8 -37.6 -4.1 -55.3 -6.2

Retailers - Shops & Snacks 186.1 175.0 179.8 -11.2 -6.0 4.9 2.8

Retailers - Pharmaceuticals and Chemists 170.9 215.9 224.0 45.0 26.3 8.1 3.7

Retailers - Others 2,596.6 3,029.3 3,042.3 432.7 16.7 13.0 0.4

Automobile Dealers & Garages 980.2 1,340.6 1,585.7 360.3 36.8 245.1 18.3

Petroleum and Energy Products 413.8 620.2 750.5 206.3 49.9 130.3 21.0

Tyre Dealers and Suppliers 9.2 8.5 4.2 -0.7 -7.7 -4.3 -50.3

Other 4,985.6 6,155.4 7,646.6 1,169.8 23.5 1,491.1 24.2

Information Communication and Technology 1,288.4 492.2 599.2 -796.2 -61.8 107.0 21.7

- of which

Telecommunications 1,003.4 179.8 179.7 -823.6 -82.1 -0.1 0.0

Internet 0.7 93.6 221.8 92.9 13,409.8 128.3 137.0

E-Commerce 6.1 3.3 2.1 -2.7 -44.9 -1.2 -36.6

Information Technology - Hardware 64.3 76.0 53.7 11.7 18.1 -22.3 -29.4

Information Technology - Software 171.7 91.0 88.4 -80.7 -47.0 -2.6 -2.9

Personal Computers 7.9 13.9 7.5 6.0 76.5 -6.4 -46.3

Other 34.5 34.6 46.0 0.1 0.4 11.5 33.1

Financial and Business Services 10,239.2 13,343.7 15,812.7 3,104.4 30.3 2,469.0 18.5

- of which

Stockbrokers & Stockbroking Companies 4.9 14.9 12.7 10.0 203.3 -2.2 -14.7

Insurance Companies 458.6 181.6 453.1 -277.0 -60.4 271.5 149.5

Nonbank Deposit-Taking Institutions 2,564.0 3,583.5 4,476.5 1,019.6 39.8 893.0 24.9

Mutual Funds 87.7 21.9 6.5 -65.8 -75.0 -15.4 -70.3

Accounting & Consultancy Services 185.2 282.0 317.0 96.8 52.3 34.9 12.4

Investment Companies 714.7 734.7 1,855.4 20.0 2.8 1,120.7 152.5

Public Financial Corporations 381.1 2,338.9 875.2 1,957.8 513.7 -1,463.7 -62.6

Other 5,843.1 6,186.1 7,816.3 343.1 5.9 1,630.2 26.4

Infrastructure 1,509.7 2,832.8 4,136.7 1,323.1 87.6 1,303.9 46.0

- of which

Airport Development 119.5 0.4 2.7 -119.1 -99.6 2.3 510.9

Port Development 0.1 0.0 0.0 -0.1 -100.0 0.0 -100.0

Power Generation 1,319.6 2,786.5 4,075.1 1,466.9 111.2 1,288.6 46.2

Water Development 0.8 7.2 13.0 6.4 786.4 5.7 79.2

Road Development 29.9 0.4 0.0 -29.5 -98.5 -0.4 -94.3

Other 39.8 38.2 45.9 -1.6 -4.1 7.7 20.2



Table III.7: Sectorwise Distribution of Credit to the Private Sector (cont’d)

Continued on next page.

BOM_AR pg 1-118_06/08 6/8/08 09:55 Page 43

44


State and Local Government 43.2 79.7 95.1 36.5 84.7 15.5 19.4

Public Nonfinancial Corporations 6,087.5 8,938.3 6,904.1 2,850.8 46.8 -2,034.2 -22.8

Regional Development Certificate Holders 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Regional Headquarters Certificate Holders 0.0 0.0 0.5 0.0 0.0 0.5 0.0

Freeport Enterprise Certificate Holders 192.0 355.9 320.2 163.9 85.4 -35.7 -10.0

Health Development Certificate Holders 22.9 27.7 64.4 4.8 20.9 36.7 132.7

Modernisation & Expansion Enterprise Cert Holders 0.0 0.0 0.1 0.0 0.0 0.1 0.0

Personal 9,790.0 11,342.4 13,683.2 1,552.3 15.9 2,340.9 20.6

Professional 912.9 600.5 628.1 -312.4 -34.2 27.6 4.6

Education 304.4 393.2 466.4 88.9 29.2 73.2 18.6

Human Resource Development Certificate Holders 0.0 0.0 0.1 0.0 0.0 0.1 0.0

Media, Entertainment and Recreational Activities 287.2 255.8 376.7 -31.5 -11.0 120.9 47.3

Other 3,495.4 3,779.7 4,188.7 284.3 8.1 409.0 10.8

Total 105,066.4 119,471.4 131,381.0 14,405.0 13.7 11,909.6 10.0



Table III.7: Sectorwise Distribution of Credit to the Private Sector (cont’d)

simple average Bank Rate and the weightedaverage interbank interest rate during 2006-07.Chart III.3 shows the movements in the weightedaverage lending rate and the weighted averageterm deposits rate during 2006-07.

OTHER FINANCIAL CORPORATIONS

Development Bank of Mauritius Ltd(DBM)

Total assets of the DBM grew by Rs615million, or 7.8 per cent, from Rs7,892 million at theend of June 2006 to Rs8,507 million at the end of

2005-06

Jul-Sep 7,978-9,805 113-1,731 5.58-6.68

Oct - 05 Jan 8,650-10,648 402-2,204 5.77-6.94

12 Jan #-Mar 6,892-8,480 576-2,134 4.37-5.36

Apr-Jun 7,155-8,216 791-1,772 4.50-5.10

2005-06 6,892 - 10,648 113 - 2,204 4.37 - 6.94

2006-07

Jul-Sep 7,051-9,014 67-2,568 4.04-5.59

Oct-18 Jan 7,165-8,583 132-1,423 4.07-4.79

01 Feb *-Mar 7,636-8,492 435-1,226 4.24-4.67

Apr-Jun 7,972-8,893 615-1,444 4.33-4.78

2006-07 7,051 - 9,014 67 - 2,568 4.04 - 5.59

Table III.8: Average Cash Ratio Maintained by Banks

AverageCashRatio

Average Excess/(Shortfall)

Cash Balances

Average CashBalances

Held

(Rs million) (Per cent)

# With effect from the week ending 12 January 2006, the cash ratio was set at 4.0 per cent. Cash balances consist exclusively of balances held with the Bank of Mauritius.

* The maintenance period for cash reserve ratio was lengthened from one week to two weeks as from 19 January 2007.

BOM_AR pg 1-118_06/08 6/8/08 09:55 Page 44

45


June 2007. Equity holdings of the DBM went up byRs147 million, or 16.9 per cent, from Rs872 millionat the end of June 2006 to Rs1,019 million at theend of June 2007. Total loans disbursed by theDBM increased by Rs358 million, or 50.7 per cent,from Rs706 million at the end of June 2006 toRs1,064 million at the end of June 2007.

National Pensions Fund (NPF)

The total investment portfolio of the NationalPensions Fund (NPF) increased by Rs3.9 billion, or10.4 per cent, from Rs37.3 billion at the end ofJune 2006 to Rs41.2 billion at the end of June2007. Over the same period, its investments inGovernment Securities, Treasury Bills and Bank ofMauritius Bills grew by Rs3.3 billion, or 13.9 percent, from Rs23.8 billion to Rs27.1 billion. Loansdisbursed by NPF during fiscal year 2006-07amounted to Rs0.5 billion compared to Rs0.3 billionas at end-June 2006. However, total loansoutstanding fell by Rs0.2 billion, or 13.3 per cent toRs1.3 billion at the end of June 2007.

CAPITAL MARKET DEVELOPMENTS

The Stock Exchange of Mauritius Ltd

During the fiscal year 2006-07, the stockmarket performed strongly, with the SEMDEX,SEMTRI (Rs) and SEMTRI (USD) reaching all timehighs of 1,439.74, 3,708.78 and 1,817.85 at thetrading session on 19 June 2007. The market’ssolid performance was attributable to the upwardprice movements of highly capitalised stocks ofcompanies from the banking and hotel sectors, thepublication of encouraging interim results by somelisted companies and the continued interest offoreign investors for local stocks during the saidperiod. Despite a slight drop in the index in May2007, the stock market recovered and rallied up tillend-June 2007.

The number of domestic listed companies onthe Official Market of the stock exchange stood at40 at the end of June 2007 compared to 41 as atend-June 2006. Market capitalisation as at 29 June2007 stood at Rs132.4 billion compared to Rs83.9billion as at 30 June 2006. There were 248 tradingsessions on the Official Market in 2006-07, with theaggregate value of transactions amounting to Rs10.8billion for a volume of 280.8 million shares anddebentures transacted, compared to 253 trading

2006

Jul 7.35 7.34 3.65 9.70-10.75 6.20-6.80 4.50 - 13.25 6.25 - 23.00 7.53 11.67

Aug 7.30 7.26 5.15 9.70-10.75 6.20-6.80 4.50 - 13.25 6.25 - 23.00 7.63 11.68

Sep 9.21 8.79 8.04 10.70-11.75 7.20-7.60 4.63 - 14.25 6.25 - 24.00 8.08 12.29

Oct 10.21 10.17 10.83 10.70-11.75 7.20-7.60 4.63 - 14.25 6.25 - 24.00 8.45 12.37

Nov 10.74 10.66 8.98 10.70-11.75 7.20-7.60 4.63 - 14.25 6.25 - 24.00 8.43 12.42

Dec 11.98 11.84 8.86 10.70-11.75 7.20-7.60 4.63 - 14.50 6.25 - 24.00 8.52 12.34

2007

Jan 13.07 12.99 8.55 10.70-11.75 7.20-7.60 4.63 - 14.75 6.25 - 24.00 8.65 12.34

Feb 13.13 13.25 9.04 10.70-11.75 7.20-7.60 4.63 - 14.75 6.25 - 24.00 9.10 12.40

Mar 11.94 12.11 8.31 10.70-11.75 7.20-7.60 4.63 - 16.50 6.25 - 24.00 9.32 12.51

Apr 11.52 11.47 8.10 10.70-11.75 7.20-7.60 4.63 - 16.00 6.25 - 24.00 9.24 12.38

May 11.65 11.67 8.37 10.70-11.75 7.20-7.60 4.63 - 14.75 6.25 - 24.00 9.31 12.45

Jun 11.14 11.08 8.31 10.70-11.75 7.20-7.60 4.63 - 15.60 6.25 - 24.00 9.46 12.47

Weighted Simple Weighted Prime Interest Interest Interest Weighted WeightedAverage Average Average Lending Rate on Rate on Rate on Average Average

Yield Bank Interbank Rate Savings Term Loans and Term Lendingon Bills Rate Interest Deposits Deposits Advances Deposits Rate

Accepted Rate with with by Rate of ofat Primary Banks Banks Banks Banks BanksAuctions

Table III.9: Other Interest Rates(Per cent per annum)


46


6.06.57.07.58.08.59.09.5

10.010.511.011.512.012.513.0

Nov

-06

Per cent

6.06.57.07.58.08.59.09.5

10.010.511.011.512.012.513.0

Jul-

06

Aug

-06

Sep-

06

Oct

-06

Dec

-06

Jan-

07

Feb-

07

Mar-

07

Apr-

07

May

-07

Jun-

07

Per centWeighted AverageLending Rate

Weighted AverageTerm Deposits Rate

Chart III.3 : Weighted Average Lending and Term Deposits Rates

1.02.03.04.05.06.07.08.09.0

10.011.012.013.014.0

Jul-

06

Aug

-06

Sep-

06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb-

07

Mar

-07

Apr

-07

May

-07

Jun-

07

Simple Average Bank Rate

Inflation Rate

Weighted AverageInterbank InterestRate

Per cent

Chart III.2: Simple Average Bank Rate, Weighted AverageInterbank Interest Rate and Inflation Rate

sessions in 2005-06, with an aggregate value oftransactions amounting to Rs4.6 billion for a volumeof 286.2 million shares and debentures transacted.

The SEMDEX increased from 841.39 at the endof June 2006 to 1,433.07 at the end of June 2007.The SEM-7 increased from 184.63 on 30 June 2006 to339.36 on 29 June 2007. The SEM Total Return Index(SEMTRI), in rupee terms, which includes priceearning ratios and dividend earnings, besidesmeasuring daily price changes on listed stocks, roseby 77.4 per cent, from 2,081.23 as at end-June 2006to 3,691.60 as at end-June 2007 while in US dollarterms, it increased by 71.4 per cent, from 1,054.84to 1,808.30.

The Stock Exchange of Mauritius successfullylaunched the Development and Enterprise Market(DEM) on 4 August 2006 to replace the Over theCounter (OTC) market. This new market wasexpected to enable Small and Medium sized

enterprises (SME’s) and newly set enterprises withgood business prospects to enlist in order to availthemselves of the advantages and facilities providedby an organized and regulated market to raise capitalto finance their future growth. At the market launch,43 companies representing a market capitalization ofabout Rs31 billion chose to list their securities on thisnew market. At end-June 2007, the number ofdomestic listed companies on the DEM stood at 49,and a total volume of 50.6 million shares for a totalvalue of Rs1.2 billion were traded since the launch ofthe market. The DEMEX increased from 100.0 on 4August 2006 to 145.4 on 29 June 2007. Foreigninvestors’ net investment on the DEM stood atRs133.3 million as at end-June 2007.

During 2006-07, foreign investors continued toinvest heavily in the local stock market. However, it isto be noted that, during 2006-07, the MCB Ltd andFincorp Investment Ltd bought back their shares fromLloyds TSB Bank Plc, amounting to Rs1,428.1 million

47


and Rs201.6 million, respectively. During 2006-07,

foreigners purchased a total amount of shares worth

Rs1,873.7 million and sold shares for Rs941.6 million

(excluding the buy back transactions of the MCB Ltd

and Fincorp Investment Ltd). Net investment by

foreign investors amounted to Rs932.0 million in2006-07 compared with a net investment ofRs1,320.1 million in 2005-06.

Chart III.4 shows the movements in theSEMDEX and SEM-7 during 2006-07.

650.00

750.00

850.00

950.00

1050.00

1150.00

1250.00

1350.00

1450.00

3-Jul-06

17-Jul-06

31-Jul-06

14-Aug-06

30-Aug-06

13-Sep-06

27-Sep-06

11-Oct-06

26-Oct-06

10-Nov-06

24-Nov-06

8-Dec-06

175

195

215

235

255

275

295

315

335

SEMDEX SEM-7

22-Dec-06

10-Jan-07

24-Jan-07

8-Feb-07

23-Feb-07

9-Mar-07

27-Mar-07

10-Apr-07

24-Apr-07

9-May-07

23-May-07

6-Jun-07

20-Jun-07

Chart III.4: Movements in the SEMDEX and the SEM-7

BOM_AR pg 1-118_06/08 6/8/08 10:06 Page 47

48

Government Finance Annual Report 2006-07

Government finance in 2006-07 wascharacterised by a higher than estimated budgetdeficit to GDP ratio, with domestic financing comingexclusively from the non-bank sector. The increasein external debt of the Government outpaced theexpansion of internal public debt reflecting both theincreasing resort to foreign resources to finance therestructuring of the economy and higherinvestments by foreign financial institutions inGovernment securities. Medium and longer-termobligations accounted for the bulk of internal debtof the Government, with a share of 60 per cent atthe end of June 2007.

Total recurrent revenue amounted to Rs41.8billion, slightly lower than the original estimate ofRs42.2 billion. Capital revenue and grants reachedRs351 million compared to an original estimate ofRs900 million, reflecting essentially delays in thedisbursement of foreign grants. Overall, totalrevenue and grants amounted to Rs42.2 billion,lower than the initial budget estimates of Rs43.1billion. Total recurrent expenditure reached Rs44.1billion, in line with forecast. However, capitalexpenditure stood at Rs7.1 billion, lower than theinitial estimate of Rs7.7 billion while lending minusrepayments amounted to Rs375 million, in contrastto a negative figure of Rs107 million estimatedinitially. Thus, total expenditure and lending minusrepayments for 2006-07 reached Rs51.6 billion, inline with the budget estimates.

The budget deficit for 2006-07 amounted toRs9,439 million, compared to the original estimateof Rs8,553 million. As a percentage of GDP atmarket prices, the budget deficit stood at 4.3 percent, higher than the initial budgetary estimate of4.0 per cent. Domestic financing came exclusivelyfrom the non-bank sector. Financing from abroadamounted to Rs4,465 million.

At the end of June 2007, public debt stoodat Rs122,120 million, representing an increase of7.7 per cent on the June 2006 level. As apercentage of GDP at market prices, public debtdeclined from 57.9 per cent at the end of June 2006to 55.7 per cent at the end of June 2007. Betweenend-June 2004 and end-June 2007, the share ofmedium and long term debt in total internal publicdebt of the Government rose by three fold to nearly60.0 per cent in the wake of the decision of

Government to lengthen the maturity structure ofits debt. Interest payments on internal and externaldebt in 2006-07 amounted to Rs9,191 millioncompared to Rs7,543 million in 2005-06.

REVENUE AND GRANTS

Total derived revenue and grants went up by7.5 per cent, from Rs39,220 million in 2005-06 toRs42,169 million in 2006-07 compared to anincrease of 8.8 per cent in the preceding year. Asa percentage of GDP at market prices, total derivedrevenue and grants edged down from 20.0 per centin 2005-06 to 19.2 per cent in 2006-07. Theincrease in tax revenue accounted for nearly 85 percent of the increase in total recurrent revenue. Asa percentage of total recurrent revenue, the shareof tax revenue declined from 91.9 per cent in2005-06 to 91.3 per cent in 2006-07. Conversely,the share of non-tax revenue rose from 8.1 percent to 8.7 per cent over the same period.

Tax revenue registered a rise of 7.9 percent to Rs38,186 million in 2006-07, lower thanthe increase of 8.1 per cent recorded in theprevious year. The increase in tax revenue wasdriven essentially by increases in revenue fromvalue added tax, taxes on property, corporatetax and excise duties, partly offset by declines inrevenue from customs duty and individualincome tax. The buoyancy of tax revenue withrespect to GDP at market prices declined from1.0 in 2005-06 to 0.7 in 2006-07. Taxes onProperty, Taxes on Goods and Services andTaxes on Income, Profits and Capital Gainsincreased by 44.3 per cent, 6.7 per cent and 1.9per cent, respectively, during 2006-07.

Taxes on goods and services rose by 6.7 percent to Rs27,703 million in 2006-07, compared to alower increase of 3.0 per cent in 2005-06. As apercentage of tax revenue, the share of taxes ongoods and services fell from 73.4 per cent in2005-06 to 72.5 per cent in 2006-07. Net revenuefrom VAT amounted to Rs15,468 million,representing an increase of 12.8 per cent comparedto 2005-06. The buoyancy of VAT with respect toGDP, however, edged down to 1.1 from 1.2 in2005-06. Excise duties rose by Rs523 million toRs7,140 million in 2006-07, as against a decline ofRs53 million in the previous year. In line withrecent trends, customs duty fell by 29.2 per cent toRs2,158 million in 2006-07 compared to a declineof 21.9 per cent in the preceding year. As a

IV. GOVERNMENT FINANCE


49

Annual Report 2006-07 Government Finance

percentage of tax revenue, the share of customsduty fell from 8.6 per cent in 2005-06 to 5.7 percent in 2006-07.

Revenue from taxes on income, profits andcapital gains went up by 1.9 per cent to Rs7,608million in 2006-07, way below the 28.1 per centincrease registered in 2005-06. Individual incometax went down by Rs436 million to Rs2,332 millionin 2006-07, in contrast to an increase of Rs215million in 2005-06. Corporate tax rose by 12.2 percent to Rs5,275 million in 2006-07 compared to anincrease of 43.5 per cent in 2005-06. The buoyancyof corporate tax with respect to GDP declinedmarkedly from 5.3 in 2005-06 to 1.0 in 2006-07.As a percentage of total tax revenue, the share oftaxes on income, profits and capital gains wentdown from 21.1 per cent in 2005-06 to 19.9 percent in 2006-07.

Taxes on property surged by 44.3 per cent toRs2,799 million in 2006-07, significantly higherthan the increase of 15.4 per cent registered in2005-06. As a percentage of tax revenue, theshare of taxes on property rose from 5.5 per centin 2005-06 to 7.3 per cent in 2006-07.

Non-tax revenue, which comprises mainlyproperty income and fees, charges and sales, roseby 16.2 per cent to Rs3,632 million in 2006-07compared to an increase of 26.4 per cent in thepreceding year, reflecting mainly higher dividendsfrom investments, fees, charges and sales andinterest and royalties.

Derived capital revenue fell by Rs193 millionto Rs29 million in 2006-07. Grants received byGovernment decreased by Rs167 million to Rs322million in 2006-07.

Table IV.1 gives details on Governmentrevenue and grants for the years 2004-05 through2007-08.

EXPENDITURE AND LENDING MINUSREPAYMENTS

Total derived expenditure and lending minusrepayments went up from Rs49,564 million in2005-06 to Rs51,608 million in 2006-07, or 4.1 percent, much below the increase of 10.0 per cent inthe previous year. As a percentage of GDP atmarket prices, total derived expenditure andlending minus repayments declined from 25.3 percent in 2005-06 to 23.5 per cent in 2006-07.

Current expenditure grew by Rs2,207 million in2006-07 while capital expenditure went up byRs151 million over the same period. Lending minusrepayments declined by Rs314 million in 2006-07.As a percentage of total derived expenditure,current expenditure edged up from 85.8 per cent in2005-06 to 86.1 per cent in 2006-07. Conversely,the share of derived capital expenditure declinedslightly from 14.2 per cent to 13.9 per cent overthe same period.

Derived recurrent expenditure went up by 5.3per cent to Rs44,122 million in 2006-07 comparedto a rise of 10.2 per cent in the preceding year.Increases of 20.8 per cent and 5.7 per cent wererecorded for interest payments and currenttransfers and subsidies, respectively, whileexpenditure on goods and services declined by 2.1per cent in 2006-07.

Interest payments on both local and externalloans went up by 20.8 per cent to Rs8,883 millionin 2006-07, way above the increase of 2.4 per centin 2005-06. Interest payments on domestic loanswent up significantly by Rs1,530 million to Rs8,616million in 2006-07, reflecting partly the conversionin June 2006 of the bulk of the 3-Year TreasuryNotes issued in 2004-05 into Treasury Notes ofvarying maturities with interest payable semi-annually. Interest payments on external loansdeclined by Rs2 million to Rs267 million in 2006-07.As a percentage of derived recurrent expenditure,total interest payments rose markedly from 17.5per cent to 20.1 per cent over the same period.

Current transfers and subsidies went up by5.7 per cent to Rs18,865 million in 2006-07, muchlower than the increase of 15.5 per cent registeredin 2005-06. Subsidy on rice and flour has beenreplaced by an income support for rice and flour.Transfers to local government and Rodrigues grewby Rs12 million to Rs2,159 million. Contributionsto the National Pensions Fund and public servicepensions went up by 9.6 per cent to Rs9,403 millionin 2006-07, lower than the rate of 12.0 per cent in2005-06. As a percentage of derived recurrentexpenditure, current transfers and subsidiesincreased slightly from 42.6 per cent in 2005-06 to42.8 per cent in 2006-07.

Expenditure on goods and services went downby 2.1 per cent to Rs16,375 million in 2006-07, incontrast to an increase of 8.5 per cent in 2005-06.Expenditure on wages and salaries and other goodsand services declined by Rs38 million and Rs308


50


1. Tax Revenue 32,718.6 35,381.5 38,185.9 42,610.0

Taxes on Income, Profits and Capital Gains 5,829.0 7,468.9 7,607.6 8,865.0

(17.8) (21.1) (19.9) (20.8)

Individual Income Tax 2,553.2 2,767.9 2,332.3 3,005.0

(7.8) (7.8) (6.1) (7.1)

National Residential Property Tax 60.0

(0.1)

Tax Deduction at Source 305.0

(0.7)

Corporate Tax 3,275.8 4,701.0 5,275.3 5,495.0

(10.0) (13.3) (13.8) (12.9)

Taxes on Property 1,680.2 1,939.5 2,798.5 3,130.0

(5.1) (5.5) (7.3) (7.3)

Land and Real Estate 409.4 537.5 968.3 1,110.0

(1.3) (1.5) (2.5) (2.6)

Financial Transactions 1,270.8 1,402.0 1,830.2 2,020.0

(3.9) (4.0) (4.8) (4.7)

Taxes on Goods and Services 25,195.2 25,957.4 27,702.8 30,537.0

(77.0) (73.4) (72.5) (71.7)

(a) Excise Duties 6,670.0 6,617.5 7,140.3 7,668.0

(20.4) (18.7) (18.7) (18.0)

(b) Taxes on Services 1,209.0 1,329.1 1,602.3 1,913.0

(3.7) (3.8) (4.2) (4.5)

(i) Tax on Gambling 1,075.3 1,185.4 1,267.6 1,418.0

(3.3) (3.4) (3.3) (3.3)

(ii) Tax on Hotel Bills 132.5 143.7 332.3 495.0

(0.4) (0.4) (0.9) (1.2)

(c) Passenger Fee 26.1 344.5 360.2 400.0

(0.1) (1.0) (0.9) (0.9)

(d) Special Levy on Banks 75.0

(0.2)

(e) Taxes on Use of Goods 861.9 911.1 974.1 1,081.0

(2.6) (2.6) (2.6) (2.5)

(f) Value-Added Tax 12,529.3 13,709.5 15,468.1 17,150.0

(38.3) (38.7) (40.5) (40.2)

(g) Customs Duty 3,898.9 3,045.7 2,157.8 2,250.0

(11.9) (8.6) (5.7) (5.3)

Other Tax Revenue 14.2 15.7 77.0 78.0

(0.0) (0.0) (0.2) (0.2)

2. Non-tax Revenue 2,473.8 3,127.2 3,632.3 4,956.0

3. Derived Capital Revenue 413.8 221.7 28.7 0.0

4. Total Derived Revenue 35,606.2 38,730.4 41,846.9 47,566.0

5. Grants 444.0 489.2 321.9 2,935.0

6. Total Derived Revenue and Grants 36,050.2 39,219.6 42,168.8 50,501.0

7. Total Derived Revenue and Grants as a % of GDP 19.9 20.0 19.2 20.3

Table IV.1: Classification of Government Revenue and Grants(Rs million)

2004-05 2005-06 2006-07 2007-08Budget

Estimates

Figures in brackets are percentages of Tax Revenue.Source: Ministry of Finance and Economic Development, Government of Mauritius.


51


million, respectively, in 2006-07. As a percentageof derived recurrent expenditure, expenditure ongoods and services declined from 39.9 per cent in2005-06 to 37.1 per cent in 2006-07. Capitalexpenditure rose by 2.2 per cent to Rs7,111 millionin 2006-07. Lending minus repayment declined byRs314 million to Rs375 million in 2006-07.

Table IV.2 shows the distribution ofgovernment expenditure for the years 2004-05through 2007-08. Charts IV.1 shows thecomposition of government expenditure for theyears 2003-04 through 2007-08.

1. Derived Recurrent Expenditure 38,042.3 41,915.3 44,122.2 50,453.1

Expenditure on Goods and Services 15,417.3 16,721.2 16,375.2 17,533.0

(40.5) (39.9) (37.1) (34.8)

(a) Wages and Salaries 1 11,674.3 12,301.1 12,263.4 13,279.0

(30.7) (29.3) (27.8) (26.3)

(b) Other Goods and Services 3,743.0 4,420.1 4,111.8 4,254.0

(9.8) (10.5) (9.3) (8.4)

Interest Payments 7,184.4 7,354.7 8,882.5 12,048.0

(18.9) (17.5) (20.1) (23.9)

(a) External 216.3 268.9 266.8 373.0

(0.6) (0.6) (0.6) (0.7)

(b) Domestic 6,968.1 7,085.8 8,615.7 11,675.0

(18.3) (16.9) (19.5) (23.1)

Current Transfers and Subsidies 15,440.6 17,839.4 18,864.5 20,872.1

(40.6) (42.6) (42.8) (41.4)

(a) Subsidy on Rice and Flour 416.9 430.5 0.0 0.0

(1.1) (1.0) (0.0) (0.0)

(b) Income Support for Rice and Flour 75.8 85.0

(0.2) (0.2)

(c) Transfers to Local Government and Rodrigues 2,048.8 2,146.1 2,158.5 2,226.6

(5.4) (5.1) (4.9) (4.4)

(d) Contributions 7,656.6 8,579.0 9,402.5 10,616.0

(20.1) (20.5) (21.3) (21.0)

(e) Other Subsidies and Current Transfers 5,318.3 6,683.8 7,227.7 7,944.5

(14.0) (15.9) (16.4) (15.7)

2. Capital Expenditure 6,344.8 6,959.9 7,110.9 9,379.0

3. Total Derived Expenditure 44,387.1 48,875.2 51,233.1 59,832.1

4. Lending minus Repayments 687.8 688.9 374.9 223.0

5. Total Derived Expenditure and Lending minus Repayments 45,074.9 49,564.1 51,608.0 60,055.0

6. Total Derived Expenditure and Lending

minus Repayments as a % of GDP 24.9 25.3 23.5 24.2

Table IV.2: Distribution of Government Expenditure(Rs million)

2004-05 2005-06 2006-07 2007-08Budget

Estimates

1 Include Travelling and Transport.Figures in brackets are percentages of Derived Recurrent Expenditure.Figures may not add up to totals due to rounding.Source: Ministry of Finance and Economic Development, Government of Mauritius.


52


BUDGETARY OPERATIONS ANDFINANCING OF THE DEFICIT

The budget deficit in 2006-07 amounted toRs9,439 million, down from Rs10,345 million in theprevious year. Total derived revenue and grantsamounted to Rs42,169 million and total derivedexpenditure and lending minus repaymentamounted to Rs51,608 million 2006-07. Thebudget deficit as a percentage of GDP at marketprices declined from 5.3 per cent in 2005-06 to 4.3per cent in 2006-07.

The budget deficit for 2006-07 was financedonly from external sources and the non-bank sector.Net foreign financing surged to Rs4,465 million,reflecting significant increases in both external loansreceived and foreign investment in Governmentsecurities. Gross external loans received by theGovernment amounted to Rs2,548 million in 2006-07 compared to only Rs496 million in the previousyear. Nonresidents invested an additional amountof Rs2,888 million in Government securities. Foreigncapital repayments amounted to Rs970 million in2006-07. Domestic financing came exclusively fromthe non-bank sector with a contribution of Rs10,897million. Financing from the central bank and bankswere negative at Rs2,043 million and Rs3,773million, respectively, in 2006-07.

In line with the policy of Government tolengthen the maturity structure of its debt portfolio,a higher amount of medium term and long-termGovernment papers, especially Treasury Notes,were issued in 2006-07. As a result, fundsstemming from maturing Treasury Bills werechannelled by banks and non-bank institutions intomedium and longer-term securities. Thus, in termsof instruments, only medium and long-termsecurities were used to finance the budget deficit.The net issue of Treasury Bills amounted to anegative figure of Rs11,116 million in 2006-07while the net issue of Treasury Notes amounted toRs10,803 million. The net issue of Government ofMauritius Bonds and 5-Year Government ofMauritius Bonds amounted to Rs1,228 million andRs2,983 million respectively in 2006-07.

Table IV.3 shows the financing of the budgetdeficit by type of debt holder and instrument for theyears 2003-04 through 2007-08.

PUBLIC DEBT

Total public debt, consisting of internal andexternal public debt, increased by 7.7 per cent,from Rs113,364 million at the end of June 2006 toRs122,120 million at the end of June 2007compared to an increase of 7.1 per cent in 2005-06. As a percentage of GDP at market prices, totalpublic debt fell from 57.9 per cent at the end ofJune 2006 to 55.7 per cent at the end of June 2007.

Internal Debt

Total internal public debt increased by 3.7 percent to Rs108,668 million at the end of June 2007,lower than the rise of 8.5 per cent registered in2005-06. As a percentage of GDP at market prices,total internal debt declined from 53.5 per cent atthe end of June 2006 to 49.6 per cent at the end ofJune 2007.

Government short-term obligations, made upof Treasury Bills, dropped significantly fromRs55,474 million at the end of June 2006 toRs43,633 million at the end of June 2007,representing a fall of 21.3 per cent compared to adecline of 5.5 per cent in 2005-06. As a percentageof total internal public debt, Government short-term obligations decreased from 52.9 per cent atthe end of June 2006 to 40.2 per cent at the end ofJune 2007.

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

55,000

60,000

2003-04 2004-05 2005-06 2006-07 2007-08

Wages and Salaries Derived Capital Expenditure

Interest Payments Current Transfers and Subsidies

Other Goods and Services

Rs million

Chart IV.1: Composition of Government Expenditure

2007-08: Budget Estimates.

53


1. Total Derived Revenue and Grants 33,675.8 36,050.2 39,219.6 42,168.8 50,501.0

2. Total Derived Expenditure and Lending Minus

Repayments 42,567.3 45,074.9 49,564.1 51,608.0 60,055.0

3. Budget Deficit (1-2) -8,891.5 -9,024.7 -10,344.5 -9,439.2 -9,554.0

4. Foreign Financing (Net) (a+b-c) -486.4 484.1 -1,149.1 4,465.2 2,012.0

(a) Gross External Loans Received

(excluding IMF) 726.8 1,187.4 496.2 2,547.7 3,050.0

(b) Foreign Invesment in Government Securities -330.8 226.6 -325.9 2,887.7 -

(c) Foreign Capital Repayments 882.4 929.9 1,319.4 970.2 1,038.0

5. Domestic Financing (Net) (A+B+C+D) 9,377.9 8,540.6 11,493.6 4,974.0 7,542.0

A. Monetary Authorities (a+b+c-d) 10,261.4 1,498.1 837.7 -2,043.0 0.0

(a) Government Stocks -6.1 0.1 0.7 6.7

(b) Treasury Bills 655.8 1,498.5 690.9 -3,132.9

(c) Advances 0.0 0.0 0.0 0.0

(d) Deposits -9,611.7 0.5 -146.1 -1,083.1

B. Banks (a+b+c+d+e-f) 3,608.6 4,062.6 3,745.4 -3,773.1 2,000.0

(a) Government Stocks 257.4 -504.9 255.8 -156.7

(b) Treasury Bills 2,513.6 1,058.2 -430.7 -10,264.4

(c) Advances 0.1 -0.1 0.0 0.0

(d) Five-Year Government Bonds 564.5 529.8 820.9 2,044.8

(e) Treasury Notes - 2,971.8 3,646.4 4,502.7

(f) Deposits -273.0 -7.8 546.9 -100.4

C. Non-Bank Sector (a+b+c+d) -3,462.3 6,030.4 7,039.5 10,897.3 5,392.0

(a) Government Stocks 1,934.3 2,281.5 1,509.7 1,378.4

(b) Treasury Bills -6,807.7 -8,676.7 -2,520.1 2,281.1

(c) Five-Year Government Bonds 1,411.1 1,469.0 2,157.6 938.1

(d) Treasury Notes - 10,956.6 5,892.4 6,299.8

D. Other Domestic Financing -1,029.8 -3,050.5 -128.9 -107.1 150.0

6. Ratio of Budget Deficit to

GDP at market prices (Per cent) 5.4 5.0 5.3 4.3 3.8

Table IV.3: Budgetary Operations and Financing(Rs million)

2003-04 2004-05 2005-06 2006-07 2007-08Budget

Estimates

Source: Ministry of Finance and Economic Development, Government of Mauritius.


54


Reflecting largely new issues of TreasuryNotes, Government of Mauritius Bonds and Five-Year Government of Mauritius Bonds, medium andlong-term obligations of the Government rose by31.8 per cent, from Rs49,355 million at the end ofJune 2006 to Rs65,035 million at the end of June2007. The share of medium and long-termobligations of the Government in total internalpublic debt thus rose appreciably from 47.1 percent at the end of June 2006 to 59.8 per cent at theend of June 2007.

External Debt

Total external public debt increasedsignificantly by Rs4,917 million, from Rs8,535million at the end of June 2006 to Rs13,452 millionat the end of June 2007. Gross disbursements andamortisation during the year amounted to Rs2,548million and Rs970 million, respectively. Interestpayments and other charges amounted to Rs277million. Foreign loans increased by Rs1,845million, from Rs8,528 million as at end-June 2006to Rs10,373 million as at end-June 2007. Foreigninvestment in Government Securities surged byRs3,072 million, from Rs7 million as at end-June2006 to Rs3,078 million as at end-June 2007.

The external debt of public corporations, bothgovernment guaranteed and non-guaranteed,decreased by Rs3,830 million to Rs11,873 millionat the end of June 2007.

The external debt of the private sectordecreased by Rs496 million to Rs1,562 million atthe end of June 2007. Total disbursements andcapital repayments in 2006-07 amounted to

Rs215 million and Rs666 million, respectively.Interest payments amounted to Rs17 million forthe period under review.

The total stock of external debt of theGovernment, public corporations and the privatesector went up by Rs590 million to Rs26,886 millionat the end of June 2007.

The debt service ratio of the country, definedas principal repayments and interest payments onexternal debt as a percentage of exports of goodsand non-factor services, decreased from 8.4 percent to 7.1 per cent in 2006-07.

Table IV.4 gives details on public debt fromend-June 2003 to end-June 2007. Chart IV.2shows the composition of public debt as at end-June 2007.

35.7%

53.3%

11.0%

Short-term Obligations

Medium and Long-term Obligations

Total External Debt

Chart IV.2: Composition of Public Debt as at end-June 2007

BOM_AR pg 1-118_06/08 6/8/08 09:58 Page 54

55


Table IV.4: Public Debt(Rs million)

2003 2004 2005 2006 2007OUTSTANDING AS AT END-JUNE

1. Short-term Obligations 74,138.3 68,332.9 58,731.2 55,474.3 43,633.0

(a) Treasury Bills 1 74,137.9 68,332.5 58,730.8 55,473.9 43,632.6

(b) Advances from Bank of Mauritius 0.0 0.0 0.0 0.0 0.0

(c) Tax-Reserve Certificates 0.4 0.4 0.4 0.4 0.4

2. Medium and Long-term Obligations 12,274.3 16,669.4 37,852.9 49,354.7 65,035.4

(a) Government Stocks 11,408.0 13,803.1 15,765.0 17,705.8 19,231.3

(b) Five-Year Government of Mauritius Bonds 866.3 2,866.3 4,866.3 7,866.3 10,866.3

(c) Treasury Notes - - 17,221.6 23,782.7 34,937.8

3. Internal Public Debt (1+2) 86,412.6 85,002.3 96,584.1 104,829.0 108,668.4

4. External Public Debt 9,074.0 8,444.9 9,232.1 8,535.0 13,451.8

(a) Foreign Loans 8,549.7 8,320.4 8,882.0 8,528.1 10,373.4

(b) Foreign Investment in Government Securities 524.3 124.5 350.1 6.9 3,078.4

5. Public Debt (3+4) 95,486.6 93,447.2 105,816.2 113,364.0 122,120.2

6. Public Debt as a % of GDP at market prices 63.7 56.3 58.5 57.9 55.7

DEBT CHARGES DURING FISCAL YEAR 2003 2004 2005 2006 2007ENDED 30 JUNE

7. Amortisation 1,987 2,109 2,597 3,383 3,352

(a) Internal 1,151 1,227 1,667 2,063 2,382

(b) External 836 882 930 1,320 970

8. Interest 6,473 6,690 7,297 7,543 9,191

(a) Internal 6,273 6,472 7,069 7,262 8,914

(b) External 200 218 228 281 277

9. Total Debt Servicing (7+8) 8,460 8,799 9,894 10,926 12,543

1 Excluding Treasury Bills held by foreign investors.Source: Ministry of Finance and Economic Development, Government of Mauritius.


56

External Trade and Balance of Payments Annual Report 2006-07

The current account of the balance of paymentsdeteriorated significantly to record a higher deficit ofRs17,469 million in 2006-07 compared withRs10,188 million registered in 2005-06. Thedeterioration mostly reflected the worsening in themerchandise account, largely on account of thepurchase of two aircrafts, which has, however, to acertain extent been offset by combined surpluses onthe services, income and current transfers accounts.In relation to GDP, the deficit on the current accountrepresented 8.0 per cent in 2006-07 compared to5.2 per cent in 2005-06.

The merchandise account of the balance ofpayments registered a higher deficit of Rs38,073million in 2006-07 from Rs25,533 million in 2005-06.On a balance of payments basis, total imports (f.o.b.)increased by 17.3 per cent, from Rs94,492 million in2005-06 to Rs110,828 million in 2006-07, drivenmostly by a higher EPZ import bill attributable to apick-up in the EPZ sector. Total exports (f.o.b.)increased by 5.5 per cent, from Rs68,959 million in2005-06 to Rs72,755 million in 2006-07.

The capital and financial account, inclusive ofreserve assets, recorded net inflows of Rs5,988million in 2006-07 compared to net inflows ofRs4,141 million in 2005-06. Exclusive of reserveassets, the capital and financial account recorded netinflows of Rs12,591 million in 2006-07 compared tonet inflows of Rs1,122 million in 2005-06.

For 2007-08, the deficit in the merchandiseaccount, inclusive of the purchase of an aircraft,has been projected to stand at Rs46,740 million.The surplus on the services account of the balanceof payments is projected to expand at a sustainedpace due mainly to anticipated higher surpluses onthe travel account. The surplus in the incomeaccount is projected to increase slightly while thesurplus on the current transfers account isprojected to rise significantly in fiscal year2007-08, largely attributable to the EU transfers inthe context of its sugar reform. Together, thecombined surpluses on the services, income andcurrent transfers accounts would fall short ofoffsetting the deficit in the merchandise accountand as a result, the current account is forecast torecord a deficit of Rs12,555 million in 2007-08. Inrelation to GDP, the deficit on the current accountwould represent 5.1 per cent in 2007-08.

Table V.1 gives a summary of the balance ofpayments accounts for the years 2003-04through 2007-08.

SERVICES, INCOME AND CURRENTTRANSFERS

The surplus on the services account increasedby 13.9 per cent, from Rs12,363 million in 2005-06to Rs14,080 million during the year under review,reflecting mainly the rise in the surplus on thetravel account, from Rs20,112 million in 2005-06 toRs24,801 million in 2006-07, which have offset thedeterioration in both the transportation and ‘otherservices’ accounts. The number of tourist arrivals toMauritius grew by 11.4 per cent, from 771,889 in2005-06 to 860,252 in 2006-07. Gross tourismearnings surged by 26.9 per cent from Rs28,571million in 2005-06 to a record high of Rs36,243million in 2006-07. Favourable exchange rate, thegradual liberalization of air access, higher rates ofoccupancy as well as the successful promotion ofMauritius as a destination particularly after the‘Chikungunya’ scare of last year contributed to thehigher tourism earnings. Total visitor nights spentincreased from 7,216,000 in 2005-06 to 8,825,000in 2006-07, while the average length of stay pertourist increased from 9.3 nights in 2005-06 to10.3 nights in 2006-07. Expenditure on foreigntravel by residents increased by 35.3 per cent toRs11,442 million in 2006-07. The deficit in the“other services” account increased from Rs3,043million in 2005-06 to Rs5,048 million in 2006-07.The transportation account recorded a higherdeficit of Rs5,673 million in 2006-07 compared toRs4,706 million in 2005-06, reflecting largelyhigher freight charges.

The income account posted a net inflow ofRs3,499 million in 2006-07, mainly on account ofhigher income earned on banks’ foreign assets. Thesurplus on the current transfers account increasedfrom Rs1,641 million in 2005-06 to Rs3,025 millionin 2006-07.

CAPITAL AND FINANCIAL ACCOUNT

During 2006-07, foreign direct investment inMauritius recorded net inflows of Rs7,851 millioncompared to net inflows of Rs1,564 million in2005-06. Gross foreign direct investment inMauritius stood at Rs10,752 million in 2006-07,largely due to investment directed to the banking

V. EXTERNAL TRADE ANDBALANCE OF PAYMENTS


57

Annual Report 2006-07 External Trade and Balance of Payments

Current Account 1,383 -6,322 -10,188 -17,469 -12,555

Goods -10,457 -20,343 -25,533 -38,073 -46,740

Exports f.o.b. 54,203 57,857 68,959 72,755 73,937

Imports f.o.b. 64,660 78,200 94,492 110,828 120,677

Imports c.i.f. 69,586 84,324 101,148 117,778 125,352

Services 11,271 12,482 12,363 14,080 22,065

Income -1,002 -134 1,341 3,499 5,890

Current Transfers 1,571 1,673 1,641 3,025 6,230

Capital and Financial Account -1,168 3,380 4,141 5,988 12,555

Capital Account -40 -28 -98 -50 -60

Financial Account -1,128 3,408 4,239 6,038 12,615

Direct Investment 964 -887 578 7,084 9,000

Portfolio Investment -743 -325 -1,679 2,725 -1,000

Other Investment 1,876 1,487 2,321 2,832 14,674

Reserve Assets -3,225 3,133 3,019 -6,603 -10,059

Net Errors and Omissions -215 2,942 6,047 11,481 0

Table V.1: Balance of Payments Summary

2003-04 2004-05 2005-06 1 2006-07 2 2007-08 3

(Rs million)

1 Revised 2 Estimates 3 ProjectionsNotes: (a) Import data for 2003-04 are inclusive of import of aircraft (Rs219 million).

(b) Import data for 2004-05 are inclusive of import of aircraft (Rs120 million).(c) Export data for 2005-06 are inclusive of sale of aircrafts (Rs670 million).(d) Import data for 2005-06 are inclusive of import of aircraft (Rs125 million) and marine vessel (Rs21 million).(e) Import data for 2006-07 are inclusive of import of aircrafts (Rs6,700 million). (f) Export data for 2006-07 are inclusive of sale of aircraft (Rs465 million).(g) Import data for 2007-08 are inclusive of import of aircrafts (Rs2,730 million). (h) As from 2002-03, data on imports and exports include transactions (i) As from 2005-06, income data include interest income of banks. through the Mauritius Freeport.

sector (Rs5.0 billion) and the tourism sector (Rs4.2billion) as developments under the IntegratedResorts Scheme (IRS) gathered pace. However,disinvestment from Mauritius was quite significantat Rs2,900 million in 2006-07, partly as a result ofnonresidents’ disposal of shares in the bankingsector of nearly Rs2.3 billion.

Direct investment abroad by residentsregistered net outflows of Rs767 million in 2006-07compared to net outflows of Rs986 million in thepreceding fiscal year. Gross foreign directinvestment by Mauritian residents stood at Rs954million in 2006-07 and was mainly directed to thetourism sector in Maldives and Seychelles, themanufacturing sector in Madagascar and theagricultural sector in Mozambique. Residents’repatriation of foreign direct investment fromabroad amounted to Rs187 million, the bulk beingdisinvestment from the financial services sector inKenya (Rs162 million).

Consequently, direct investment recorded netinflows of Rs7,084 million in 2006-07 compared tonet inflows of Rs578 million in 2005-06. Portfolioinvestments recorded net inflows of Rs2,725 million

in 2006-07, as against net outflows of Rs1,679million registered in 2005-06. This reflected highernet portfolio investments effected by non-residentsin Mauritius, which rose from Rs995 million in2005-06 to Rs5,851 million in 2006-07 that morethan offset the increase in net portfolio investmentsabroad by residents, which went up from Rs2,674million a year earlier to Rs3,126 million in 2006-07.

Loan receipts on account of Governmentamounted to Rs2,548 million in 2006-07 whilecapital repayments totalled Rs970 million, implyinga net inflow of Rs1,578 million. Loandisbursements to public corporations, both financialand non-financial, amounted to Rs7,443 millionwhile capital repayments totalled Rs4,608 million,thus registering a net inflow of Rs2,835 million in2006-07 as against a net outflow of Rs866 millionduring 2005-06. Private long-term capitalmovements recorded a net outflow of Rs450 millionin 2006-07 compared to a net outflow of Rs121million during the preceding fiscal year. Short-termnet foreign assets of banks, adjusted for balance ofpayments coverage, increased by Rs13,507 millionin 2006-07 as compared to a rise of Rs5,696 millionin 2005-06.


58

Box II THE IMF’s 2005 COORDINATEDPORTFOLIO INVESTMENT SURVEY (CPIS)

The Coordinated Portfolio Investment Survey(CPIS), which is an initiative of the InternationalMonetary Fund (IMF), aims at significantly improvingthe coverage of cross-border portfolio investmentassets at the country and global level. The CPIScollects information on holdings by domestic residentsof securities issued by unrelated nonresidents. TheCPIS also intends to provide a disaggregationaccording to the country of residency of the issuer inorder to derive cross-border portfolio investmentliabilities, both at the country and global level.

Results of the 2005 CPIS

Total global portfolio investment assetsincreased from US$23.3 trillion at the end ofDecember 2004 to US$25.9 trillion at the end ofDecember 2005, driven mainly by higherinvestment in equity and long-term debtsecurities. For the 2005 CPIS, securities held asreserve assets and holdings of internationalorganizations amounted to US$2.2 trillion, up fromUS$2.1 trillion at the end of December 2004. TheUnited States, United Kingdom and Japanremained the three largest investing countries witha total share of 35.1 per cent of total portfolioinvestment assets, up from 33.9 per cent in 2004.

Of total global cross-border holdings,US$10.6 trillion were held as equity securities,US$13.4 trillion as long-term debt and US$1.9trillion as short-term debt in the 2005 CPIS. Asat end-December 2005, the top five economiesthat were the largest issuers of securities thatwere traded internationally remained theUnited States, United Kingdom, Germany,France and Netherlands while the top fiveeconomies that were the largest holders of suchsecurities continued to be the United States,United Kingdom, Japan, France, andLuxembourg. The results of the 2001 through2005 CPIS are available on the Fund’s website(Portfolio Investment: CPIS Data Results;http://www.imf.org/external/np/sta/pi/datarsl.htm).

CPIS in Mauritius

In Mauritius, the Bank of Mauritius (which isthe focal point for the conduct of the survey) andthe Financial Services Commission (FSC) have beenconducting CPIS jointly since 2001. The survey,which is conducted in accordance with standardiseddefinitions and methodologies and draws on bestpractices in survey design, was identified in theIMF’s Coordinated Portfolio Investment SurveyGuide (Second Edition) published in 2002.

As mutually agreed, the Bank of Mauritiussurveyed banks for the 2003, 2004 and 2005 CPISwhile the FSC surveyed non-bank financialinstitutions together with the global businesssector. The response rate for institutions surveyedby the FSC has improved significantly over the lastthree years especially with regard to the globalbusiness sector, which provides almost the totalityof its respondents’ portfolio investment assets.The data for the 2005 CPIS from both the Bank ofMauritius and the Financial Services Commissionwere consolidated and forwarded to the IMF at thebeginning of October 2005. Total portfolioinvestment assets of Mauritius, exclusive offoreign exchange reserve assets, stood atUS$54,834 million at the end of December 2005,up from US$39,030 million at the end ofDecember 2004. The significant increase inportfolio investment assets in 2005 was essentiallydriven by the global business sector with the latteraccounting for 98.5 per cent of total foreignportfolio investment assets compared to 98.1 percent for the 2004 CPIS. As at end-December 2005,India remained the principal destination for ourportfolio investments (US$39,136 million or 71.4per cent), followed by China (US$4,887 million or8.9 per cent) and Indonesia (US$3,823 million or7.0 per cent). Most of the investments were in theform of equities (US$48,837 million or 89.0 percent) while long-term debt stood at US$5,529million (or 10.1 per cent). Portfolio investmentsin short-term debt stood at US$468 million (or0.9 per cent).

The IMF’s 2005 Coordinated Portfolio Investment Survey (CPIS) Annual Report 2006-07

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NET INTERNATIONAL RESERVES

The net international reserves of the country,

made up of the net foreign assets of the Bank of

Mauritius, Net Foreign Assets of Depository

Corporations, the foreign assets of the Government

and the country's Reserve Position in the

International Monetary Fund (IMF), increased byRs18,759 million, from Rs64,740 million at the endof June 2006 to Rs83,499 million at the end ofJune 2007.

Table V.2 shows the monthly level of netinternational reserves of the country during fiscalyear 2006-07.

2006

Jul 43,159 23,185 548 66,891

Aug 44,060 26,208 570 70,837

Sep 42,891 28,703 567 72,161

Oct 41,714 28,879 525 71,118

Nov 43,552 32,985 549 77,086

Dec 44,007 34,049 543 78,599

2007

Jan 42,515 35,347 447 78,309

Feb 44,527 36,925 442 81,895

Mar 46,963 33,442 438 80,842

Apr 50,204 29,624 383 80,211

May 49,460 28,873 376 78,709

Jun 52,223 30,939 338 83,499

Table V.2: Net International Reserves (Rs million)

Bank of MauritiusNet Foreign Assets

Other DepositoryCorporations NetForeign Assets 1

Others 2 Net InternationalReserves

1 The Net Foreign Assets of Other Depository Corporations are adjusted for transactions of Global Business Licence Holders. 2 Comprise foreign assets of the Government and the country’s Reserve Position in the IMF.

The major component of net internationalreserves, namely, net foreign assets of the Bank ofMauritius, increased by Rs9,908 million, fromRs42,315 million at the end of June 2006 toRs52,223 million at the end of June 2007. Netforeign assets of Other Depository Corporationsincreased by Rs9,051 million, from Rs21,888million at the end of June 2006 to Rs30,939 millionat the end of June 2007.

In terms of import cover, the level of netinternational reserves of the country at the end ofJune 2007 represented around 8.5 months ofimports based on the value of the import bill (c.i.f.)for fiscal year 2006-07 excluding imports ofaircraft, compared with 7.1 months of imports atthe end of June 2006. The end-June 2008 level ofnet international reserves of the country has beenprojected at Rs89,994 million, equivalent to 8.5months of imports.

EXCHANGE RATE DEVELOPMENTS

Exchange rate movements on theinternational foreign exchange market during thefiscal year 2006-07 largely reflectedmacroeconomic outlook with its implication onmonetary policy and interest rate differentials.

The US dollar movement during 2006-07 wasmostly influenced by market expectations over thefuture path of US interest rates after the US FederalReserve delivered its consecutive 17th interest ratehike on 29 June 2006. Expectations that the UScentral bank might pause with its rate-hikingcampaign surfaced in July 2007 when, in his semi-annual testimony to the congressional committee,the US Federal Reserve Chairman, Ben Bernanke,stated that inflation would likely ease in comingquarters and that the full economic impact of theprior interest rate increases had yet to be felt. On


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8 August 2006, the US Federal Reserve, asexpected, left the federal funds rate unchanged at5.25 per cent while, in its accompanying statement,it mentioned that the door was open to furthercredit tightening if price pressures persisted. Therelease by the end of August of declining USproducer price and tame consumer price data,however, supported the view that inflation riskswere subsiding and confirmed expectations ofholding rates. On 20 September 2006, the Fed, asexpected, kept interest rate unchanged but heldout the possibility of further hikes. As the marketreassessed the outlook of the US economy andamid profit taking, the US dollar managed to gainground. On 25 October 2006, the US FederalReserve’s decision of leaving the federal funds rateunchanged for the third time running somewhatweighed on the US dollar as expectations of thepause in rate hikes rekindled. The release ofrelatively weak US economic data during Novemberand December 2006 suggesting that the USeconomy might be cooling down drove the UScurrency to multi-months lows against the majorEuropean currencies. The data releases evenprompted the White House to revise down itsgrowth rate estimates for 2006 and 2007. TheFederal Reserve, as expected, left its federal fundsrate unchanged at 5.25 per cent on 12 December2006. In its accompanying statement, the Fedtoned down its tightening bias on monetary policy,saying that the US economy slowed down over thecourse of the year, mirroring the substantial coolingof the housing market. Growing expectations thatthe Fed might have to consider trimming interestrate at some point exacerbated the downwardtrend of the US currency. Starting 2007, the USdollar, however, managed to recoup some of itsprevious losses, garnering support from asignificant drop in oil prices and the release of aseries of upbeat US economic data, which managedto soothe market expectations that the FederalReserve might cut interest rates in the comingmonths. On 31 January 2007, as widely expected,the Federal Reserve kept its key interest ratesteady at 5.25 per cent and, in its accompanyingstatement, mentioned that inflation pressures werelikely to moderate. At its FOMC meeting on 20-21March 2007, the Fed again maintained its nochange monetary policy stance but dropped itsreference to possible further rate hikes in itsstatement and indicated that future policyadjustments would depend on the evolution of theoutlook for both inflation and economic growth. The

US dollar, undermined by unfavourable interestrate differentials as other major central banksembarked on a tightening monetary policy modeand amid position adjustment as investors shiftedto higher yielding currencies, remained relativelyweak throughout April and May 2007. As expected,on both occasions on 9 May and 28 June 2007,respectively, the US Federal Reserve left thefederal funds rate unchanged at 5.25 per cent.

The euro made important gains during 2006-07, underpinned by expectations that the EuropeanCentral Bank (ECB) would keep on increasinginterest rate to guard against risks to price stabilityand by the release of encouraging euro zoneeconomic data. The ECB, as expected, left its keyrefinance rate unchanged at 2.75 per cent at itsgoverning council meeting on 6 July 2006. But,comments from various ECB officials thereafterindicated that the ECB was most likely headingtowards an imminent interest rate hike. Thoseexpectations eventually materialized, with the ECBraising its key refinance rate by a quarterpercentage point to 3.00 per cent on 3 August2006. Although the rate decision was largely pricedin the market, the euro drew support from remarksmade by ECB President Jean-Claude Trichet in thepost-meeting conference that monetary policy inthe euro zone remained accommodative andfurther tightening might be needed. Owing to itsanti-dollar status, the euro somewhat moved in aseesaw direction thereafter, supported on one handby the ongoing possibility of higher euro zone ratesand undermined on the other hand by the recoveryof the US dollar. Hence, the euro, on average,traded around US$1.2810 during August 2006, butlost ground against the US dollar during September2006, averaging US$1.2743. As expected, on 5October 2006, the ECB raised its key refinancingrate by 25 basis points to 3.25 per cent. Despitethe rate hike, the euro remained under pressureagainst the US currency, as in its post-meetingstatement, ECB President Jean-Claude Trichetprovided no clear signal for further tighteningbeyond an expected rise in December 2006. ByNovember 2006, however, the euro embarked on agenerally upward trend against the US dollar,benefiting from market expectations of further ratehikes in 2007, beyond the widely expected one inDecember 2006 and the euro zone financeministers’ apparent lack of concern over thestrength of the single currency.

On 7 December 2006, the ECB raised its keyrefinancing rate by another 25 basis points to 3.50


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per cent. Amid the release thereafter of upbeatdata and in the wake of ECB’s President’s testimonybefore European Parliament, which fuelled marketexpectations for euro zone rates to rise further in2007, the single currency remained well supported.With the US dollar managing to regain ground inJanuary 2007, the euro suffered some temporarysetback before resuming on its upward trend, as itcontinued to benefit from expectations of furthermonetary tightening. On 8 March 2007, the ECB,as expected, raised its key refinance rate to a five-year high of 3.75 per cent. In its March 2007monthly bulletin, the ECB even stated that at afive-and-a-half-year high of 3.75 per cent,monetary policy "continues to be on theaccommodative side, with the key interest ratesmoderate," which left the door open to further risesin euro zone interest rates. On 29 April 2007, theeuro, for the first time since its launch in January1999, breached above US$1.3680 in New Yorktrade following comments made by EuropeanCommission President that the strong euro was asign of a robust European economy and not a causefor concern. Although the single currency came offits newly attained record level against the USdollar, it remained on average well supported. Thenewly-elected French President Sarkozy, however,voiced out his concerns over the strength of theeuro, stating that there was no reason why theeuro zone should be the only region in the world tobe handicapped by an overly strong currency.Meanwhile, ECB officials continued to show theirconcerns towards inflation risks in the euro zonethereby supporting the view in the market that theECB would tighten its monetary stand further. Theeuro closed 2006-07 trading around US$1.3443.

The Pound sterling made commendable gainsagainst the US dollar during 2006-07, mainlybenefiting from its high interest rate appeal. ThePound sterling started July 2006 on a soft tone asmarkets were convinced that the Bank of England(BOE) was unlikely to raise interest rates anytimesoon. As widely expected, the BOE left its key reporate unchanged at 4.50 per cent at the end of itstwo-day Monetary Policy Committee (MPC) meetingon 6 July 2006. UK retail sales data releasedaround mid-July 2006, which raised concerns thatUK consumer spending could slow, also weighed onthe Pound. But the trend was reversed with theBritish currency benefiting from the release ofstronger-than-expected British inflation data, whichrekindled expectations that the BOE might raiseinterest rates this year. The British currency in fact

benefited from the BOE’s surprise rate hike from4.50 per cent to 4.75 per cent at the end of itstwo-day (MPC) meeting on 4 August 2006.Policymakers said that the hike was needed toensure that inflation - already half a point above its2.0 per cent target on the back of soaring energycosts - would come back down as the economy wasalready operating close to capacity and growth hadpicked up. However, the Pound somewhat movedlower during September 2006, hurt by positionadjustment in favour of the US dollar. The BOE’sdecision of leaving its key repo rate steady at 4.75per cent on 5 October 2006 exerted additionaldownward pressure on the Pound as it disappointedthose who were betting on the outside chance of aUK rate rise. However, the release of upbeat UKdata, namely, British mortgage lending, moneysupply and house prices by the close of October2006, provided support to the Pound as theyheightened expectations of a near-term UK interestrate hike. At the end of its two-day MPC meeting on9 November 2006, the BOE, as expected, raised itskey repo rate by 25 basis points to 5.00 per cent,its highest level in 5 years. The Pound sterlingcontinued to appreciate against the US dollarduring December 2006. The release of above-forecast inflation data, with the UK CPI inflationrising to 2.7 per cent year-on-year in November2006 and boosting the case for another rate hike inearly 2007, provided a boost to the Pound. On 11January 2007, the BOE, in fact, surprised themarket with a 25 basis points increase in its keyrepo rate to 5.25 per cent. Amid marketexpectations that the BOE was more likely to stayon hold this month and rise in February 2007, therate decision provided a boost to the Pound.Expectations of further tightening and remarks byBOE Governor Mervyn King stating that risks toBritish inflation and growth have shifted to theupside provided further support to the Pound. On23 January 2007, on the New York market, thePound sterling hit a 14-year high of above US$1.99against the US dollar, challenging thepsychologically key US$2.0 level. However, thePound’s move towards US$2.0 level was capped bythe release of the BOE MPC minutes, which showedthat only five of its nine members voted for thismonth’s surprise interest rate hike, sowing doubtsabout chances of more UK rate hikes. By the closeof January 2007, the Pound was trading aroundUS$1.9629. Unwinding of long positions asinvestors became more risk averse after the sharpfall in global stocks weighed on the British currency


62


during March 2007, with the latter even decliningbelow the US$1.93 level. However, with the releaseof strong output prices and the market therebyincreasingly anticipating an interest rate hike inMay 2007 and pricing in possibility of more ratehikes, the Pound again regained ground against theUS dollar as investors looked into the Britishcurrency as a source of return. On 18 April 2007,the Pound sterling breached above the US$2.0mark for the first time since Britain was forced toexit the Exchange Rate Mechanism to attainUS$2.0133 in London trade after the release ofstrong UK consumer prices, which accelerated to3.1 per cent in March 2007, above the target level.Even though the Pound shed off some of its gains,it remained well-supported vis-à-vis the US dollar,as a testimony from the BOE’s MPC member to theparliamentary committee reassuring investors thatthe Bank would do all it can to keep inflationarypressures under control, firmed up marketexpectations of higher UK interest rates. Asexpected, on 10 May 2007, the BOE’s MPC raisedits key repo rate to 5.5 per cent, but theaccompanying statement mentioned that futureinterest rate hikes were clearly dependent on theoutcome of future data and that was viewed as a

modest disappointment to some extent by marketplayers that had fully priced in another rateincrease before year-end. The Pound sterling,thereafter, traded within tight ranges amid therelease of mixed data and position adjustment bymarket players.

Reflecting mainly local market conditions andinternational trends, the exchange rate of theMauritian rupee came under downward pressurevis-à-vis the currencies of our major tradingpartners during 2006-07. On a 12-month runningperiod between June 2006 and June 2007, therupee, on a daily average basis, depreciatedagainst the Pound sterling, euro, US dollar andJapanese yen by 14.3 per cent, 13.3 per cent, 6.3per cent and 4.4 per cent, respectively. The rupeehowever appreciated by 4.6 per cent against theSouth African rand.

Table V.3 shows the exchange rate of theMauritian rupee vis-à-vis major trading partnercurrencies.

The Mauritian rupee started the fiscal year2006-07 on a relatively strong note, trading at itsintra-fiscal year daily average peak of Rs31.0118against the US dollar. The rupee, thereafter,

Australian dollar 22.9760 25.9429 (11.4)

Hong Kong dollar 3.9949 4.2438 (5.9)

Indian rupee (100) 69.6522 75.2379 (7.4)

Japanese yen (100) 26.7584 27.9835 (4.4)

Kenya shilling (100) 42.6719 47.5475 (10.3)

New Zealand dollar 20.6428 22.5649 (8.5)

Singapore dollar 18.8326 21.3458 (11.8)

South African rand 4.8889 4.6727 4.6

Swiss franc 23.9822 26.6377 (10.0)

US dollar 30.5981 32.6437 (6.3)

Pound sterling 54.5405 63.6095 (14.3)

Euro 37.3613 43.0911 (13.3)

Table V.3: Exchange Rate of the Rupee vis-à-vis Major Trading Partner Currencies

Indicative Average for Average for Appreciation/(Depreciation)Selling Rates 12 Months Ended 12 Months Ended of Rupee

June 2006 June 2007 Between (1) and (2)

(Rupees) (Per cent)(1) (2) (3)

Note: The daily average exchange rate of the rupee is based on the average selling rates for T.T. and D.D. of banks.


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embarked on a generally downward trend againstthe US dollar, notwithstanding a hike of 50 basispoints in the Lombard Rate by the Bank of Mauritiuson 10 July 2006 to 12.0 per cent with a view todampening inflationary pressures in the economyas well as enhancing the attractiveness of rupee-denominated financial assets. The rupee breachedabove the Rs32 mark for the first time ever on 14August 2006 and maintained its downwardmovement against the US dollar, despite the Bank’sdecision to raise the Lombard Rate by another 100basis points to 13.00 per cent on 11 September2006. Against a backdrop of shortage of liquidity onthe domestic interbank foreign exchange market,the depreciating trend of the rupee against the USdollar was exacerbated with the rupee breachingabove the Rs33 level against the US dollar for thefirst time ever on 8 November 2006.

With depreciation expectations self-fulfillingthe market, the rupee, on 6 February 2007,attained its all-time low of Rs33.6582 vis-à-vis theUS dollar. However, the authorities’ determinationto correct the imbalance on the domestic foreignexchange market by way of intervention managedto put an end to the self-fulfilling depreciationexpectations of the Mauritian rupee. As the marketrapidly factored in the authorities commitment tosupport the rupee, there was a reversal insentiment towards the Rupee/US dollar exchangerate, with the rupee, recouping its lossessignificantly, to breach below the Rs33 level againstthe US currency on 27 March 2007. The decline ofthe US dollar on international markets coupled withsignificant rise in yields on domestic money marketinstruments, which led to increased foreign demandfor domestic instruments thereby resulting intosignificant foreign exchange inflows to the domesticmarket, further supported the rupee. On 4 May2007, the rupee managed to cross below the Rs32mark, trading at Rs31.9787 against the US dollar.However, towards the end of May 2007, therupee/US dollar exchange rate has been subject todownward pressure. On 13 June 2007, the rupeebreached above the Rs32 level but managed toremain range-bound, closing the fiscal year atRs32.0239 against the US dollar.

The movements of the rupee vis-à-vis theeuro reflected a combination of the singlecurrency’s movements against the US dollar on theinternational foreign exchange market and themovements of the rupee against the US dollar. Therupee, which started fiscal year 2006-07 trading at

a daily average rate of Rs39.9524 against the euro,hit its intra-year high daily average rate ofRs39.5194 on 19 July 2006. However, the rupeecould not sustain to this level against the singlecurrency, losing ground to cross above the Rs41mark for the first time ever on 7 August 2006 andabove the Rs42 level on 21 August 2006. As self-fulfilling depreciating expectations of the rupeegained the market, the decline of the rupee/euroexchange rate garnered further momentum and therupee breached above the Rs43 level at the start ofNovember 2006, above Rs44 mark on 23November 2006 and above Rs45 level within dayson 29 November 2006. Starting 2007 trading at adaily average rate of Rs45.6633, the rupee,however, managed to regain ground against theeuro to trade around Rs43.9297 by the end ofJanuary 2007. On 9 May 2007, the rupeemanaged to breach below the Rs43 level andcontinued to trade within the Rs42.5679-Rs42.9804 range until 25 June 2007 when it againmoved above the Rs43 mark before closing thefiscal year at Rs43.0551 per euro.

From an average rate of Rs57.428 per Poundat the beginning of fiscal year 2006-07, the rupeeappreciated against the British currency to hit itsintra-year high of Rs57.110 per Pound on 6 July2006. The rupee, however, did not hold on its gainsembarking on a generally downward trend againstthe Pound. On 20 July 2006 the rupee breachedabove the Rs58 level and by the close of the monthit had reached a new record low of Rs59.028against the Pound. The depreciation of the rupeevis-à-vis the Pound gathered momentum and by 7August 2006, the rupee had already crossed a newrecord level of beyond Rs60. Within three tradingdays, on 10 August 2006 the rupee furtherdepreciated to reach a new low of Rs61.105 againstthe Pound. On 24 August 2006, the Rs/Pound ratehad moved above Rs62. The rupee, thereafter,traded within tight ranges against the Poundsterling until 27 October 2006 when it reached anew record low of Rs63.313 and by 10 November2006, it has breached above Rs64 per Pound. Thedownward movement of the rupee accentuatedover the last week of November and the start ofDecember 2006, when the rupee successivelydeclined to new record low levels beyond Rs65,Rs66 and Rs67 on 27 November, 29 November and4 December 2006, respectively. Subsequently, therupee traded within the Rs66-Rs67.133 range,closing 2006 trading at Rs66.948 per Pound. The


64


rupee again came under downward pressureagainst the British currency as from the secondweek of January 2007 to hit its intra-year all timelow, of Rs67.575 per Pound on 19 January 2007.There was a turnaround in the Rs/Pound exchangerate towards the close of January 2007, when therupee sank below Rs67 level. By 13 February2007, the rupee had managed to gain 100 centsagainst the Pound as it crossed below the Rs66level. On 5 March 2007, the rupee had reachedbelow the Rs65 level trading around Rs64.328against the Pound. The rupee, from then on,remained more or less range bound, trading withinnarrow ranges, systematically staying above theRs64 mark until 17 April 2007, when it againcrossed above the Rs65 level when the Poundreached its highest level on the internationalmarket. Thereafter, the rupee recouped some of itslosses to trade below the Rs65 mark as from 25April 2007, gaining ground further to move belowthe Rs64 level on 3 May 2007 and below the Rs63mark on 11 May 2007. The rupee, subsequently,traded around Rs63 per Pound but in the last weekof June 2006, it had moved to around Rs64 perPound before closing fiscal year 2006-07 trading atRs64.143 per Pound.

From an average rate of Rs27.30 per 100 yenon 3 July 2006, the rupee traded within tightranges until 17 August 2006, when the rupeecrossed Rs28 level to trade around Rs28.07 per 100Yen. The rupee systematically remained above the

Rs28 per 100 Yen thereafter except on 13September 2006 when the rupee traded at a dailyaverage rate of Rs27.96 per 100 Yen and within theperiod 9 October to 16 October 2006 when theexchange rate of the rupee against the yen waswithin the range of Rs27.81 - Rs27.91. From thenon, the Rupee/Yen exchange rate remained abovethe Rs28 per 100 Yen level until 22 November 2006when it breached above the Rs29 per 100 Yenbefore hitting its intra-year all-time low of Rs29.64per 100 Yen on 6 and 7 December 2006. The rupeethereafter recouped some of its losses to closecalendar year 2006 trading at Rs28.84 per 100 Yen.From Rs28.90 per 100 Yen on 3 January 2007, therupee remained relatively range bound tradingwithin the Rs28-Rs29 level per 100 Yen. As fromthe second week of April 2007, the rupee gainedground against the Japanese yen trading below theRs28 per 100 Yen mark. The rupee maintained itsgenerally upward movement crossing below theRs27 per 100 Yen level on 2 May 2007 until thefinal week of June 2007 when it hit its intra-yearhigh of Rs25.96 per 100 Yen on 22 and 25 June2007. The rupee closed the fiscal year 2006-07trading at a daily average rate of Rs26.07 per100 Yen.

Chart V.3 shows the trends in the dailyexchange rates of the rupee against the US dollar,euro, Japanese yen, Pound sterling and SouthAfrican rand.


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Rs/Japanese yen (Rs per 100 Yen)

25.95

26.55

27.15

27.75

28.35

28.95

29.55

Rs/South African rand

4.20

4.30

4.40

4.50

4.60

4.70

4.80

4.90

5.00

5.10

Rs/Pound sterling

56.5057.1057.7058.3058.9059.5060.1060.7061.3061.9062.5063.1063.7064.3064.9065.5066.1066.7067.3067.90

Rs/US dollar

30.9531.1531.3531.5531.7531.9532.1532.3532.5532.7532.9533.1533.3533.5533.75

Rs/Euro

39.0039.5040.0040.5041.0041.5042.0042.5043.0043.5044.0044.5045.0045.50

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Chart V.3: Movements of the Daily Exchange Rate of the Rupee vis-à-vis Major Currencies: 2006-07


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Box III IMF Executive Board Concludes 2007Article IV Consultation with Mauritius

Public Information Notice (PIN) No. 07/58May 29, 2007

Public Information Notices (PINs) formpart of the IMF's efforts to promote transparencyof the IMF's views and analysis of economicdevelopments and policies. With the consent ofthe country (or countries) concerned, PINs areissued after Executive Board discussions ofArticle IV consultations with member countries,of its surveillance of developments at the regionallevel, of post-program monitoring, and of ex postassessments of member countries with longer-term program engagements. PINs are also issuedafter Executive Board discussions of generalpolicy matters, unless otherwise decided by theExecutive Board in a particular case.

On May 7, 2007, the Executive Board of theInternational Monetary Fund (IMF) concluded theArticle IV consultation with Mauritius.

1

Background

The loss of trade preferences in textiles in2005, the reform to the European Union's sugarprotocol for 2006-10, and higher international oilprices have brought about a permanentdeterioration in Mauritius's terms of trade. Theauthorities have initiated broad-based reforms toaddress recent economic setbacks and to raisegrowth to levels of the previous two decades.

Real GDP growth is expected to reach over4 percent in 2006/07 (fiscal year ending in June),owing to a strong service sector outturn andslowing job losses in the textile sector.Unemployment, however, remains close to itshistoric high. Inflation, after peaking in December2006-largely because of onetime budgetarymeasures and a weakening rupee-fell to 9.2percent in February 2007 (year-on-year).

The fiscal deficit target for 2006/07 (4 percentof GDP) is within reach, with the adjustment relyingpartly on lower capital expenditure. The external

current account deficit widened to 5.3 percent ofGDP in 2005/06 because of weak textile andsugar exports and higher oil prices. An aircraftimport will further widen the current accountdeficit in 2006/07. The Bank of Mauritius hascontinued to intervene in the interbank foreignexchange market and has gradually raised itssignaling rate to contain inflation. Foreignreserves have continued to decline but havestayed at a comfortable level. The real effectiveexchange rate has depreciated by over 10percent since 2004.

Executive Board Assessment

Executive Directors commended theauthorities for the reforms introduced with the2006/07 budget to adjust to the loss of tradepreferences and reduce the fiscal deficit. Whileinflation needs to be reduced, and the currentaccount deficit and public debt remain large,Directors considered that the economy is on theright track, supported by reforms to improve thebusiness environment, simplify the tax system,liberalize trade, open air access, and advanceeconomic restructuring, including thedevelopment of new sectors. Directors noted thatlabor market reform will be needed to supporteconomic restructuring. They encouraged theauthorities to maintain the reform momentum.

Directors welcomed the authorities' effortsto tighten monetary policy. This should help toreduce inflation and avoid entrenching inflationexpectations. Most Directors encouraged theBank of Mauritius to consider raising the reporate if inflation does not decline as expected.They welcomed improvements in the monetaryframework, and called for further development ofthe institutional framework in order to strengthenthe monetary policy transmission mechanisms.

Directors noted that additionalimprovements in external competitiveness areneeded to help restore external balance. Wage

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restraint, productivity gains, and labor marketflexibility are key to achieve this. Directorsconsidered that the flexible exchange rate regimehas served Mauritius well, with rupeedepreciation softening the negative effect of theterms of trade decline. They encouraged theauthorities to limit foreign exchange interventionto smoothing excess volatility.

Directors welcomed the progress madetoward fiscal consolidation and better publicexpenditure management, aimed at loweringpublic debt and improving the quality of thebudget. They noted that fiscal pressure in themedium term would require more decisive fiscalconsolidation and further improvements inexpenditure management. They encouraged theauthorities to identify options for budgetarysavings and to continue strengthening debtmanagement.

Directors considered that efforts to boostgrowth and employment could be complementedby reforms that further liberalize trade, deepenthe financial sector, and deregulate prices, whiletaking into account the need to protectvulnerable groups. They commended the steps toliberalize trade, and advocated a simple andtransparent tariff framework. Addressinginstitutional constraints in the financial sectorcould help lower borrowing costs and make morefinancing available to small and medium-sizedenterprises. A systematic review of pricecontrols, including a review of the largest publicenterprises, should guide further reform inthis area.

Directors welcomed the 2007 FinancialSystem Stability Assessment update and thereforms implemented since the 2002-2003Financial Sector Assessment Program (FSAP).Mauritius's financial sector has shown resilienceto the loss of trade preferences. Going forward,Directors called for further organizational andinstitutional strengthening in order to improvefinancial sector regulation, supervision, andinfrastructure.

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IMF : Public Information Notice Annual Report 2006-07

Projection

(Annual percent change,unless otherwise indicated)

National income, prices and employment

Real GDP 3.0 3.7 4.1 4.4

Real GDP per capita 2.2 2.9 3.3 3.6

Consumer prices (end of period) 5.4 7.6 8.7 6.0

Unemployment rate (percent) 9.0 9.5 ... ...

External sector

Exports of goods, f.o.b. (U.S. dollars) 3.7 12.8 4.5 2.0

Imports of goods, f.o.b. (U.S. dollars) 17.3 14.9 10.7 0.9

Real effective exchange rate2 -5.5 -1.2 ... ...

Money and credit

Broad money (end of period, annual

percentage growth) 13.1 11.2 10.5 12.3

Central government budget

Overall balance (including grants) -5 -5.3 -4.1 -4.7

Revenues and grants 20.1 20.1 19.6 20

Expenditure and net lending 25.1 25.5 23.8 24.7

Domestic debt of central government 53.9 53.8 51.4 48.3

External debt of central government 5.1 4.4 5.0 5.5

External sector

Current account balance -3.5 -5.3 -7.4 -4.9

Overall balance of payments -1.7 -1.5 -1.9 -1.3

Net international reserves, BOM

(millions of U.S. dollars) 1,442 1,377 1,243 1,143

Net international reserves, BOM

(months of imports of goods, c.i.f.) 5.9 5.0 4.0 3.7

Mauritius : Selected Economic and Financial Indicators, 2004/05 - 2007/08

2004/05 2005/06 2006/07 2007/08

Sources: Bank of Mauritius; Central Statistics Office; Ministry of Finance; and IMF staff estimates and projections.Fiscal year (July-June).

2 Trade-weighted period averages (a negative sign signifies a depreciation).

1 Under Article IV of the IMF's Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economicand financial information, and discusses with officials the country's economic developments and policies. On return to headquarters, the staff prepares a report, whichforms the basis for discussion by the Executive Board. At the conclusion of the discussion, the Managing Director, as Chairman of the Board, summarizes the views ofExecutive Directors, and this summary is transmitted to the country's authorities.

(Percent of GDP at market prices)

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Annual Report 2006-07 Regional Cooperation

SOUTHERN AFRICAN DEVELOPMENTCOMMUNITY (SADC)

During the 2006 SADC Summit held inMaseru, Lesotho, in August 2006, it was observedthat the implementation of SADC programmes inview of the achievement of SADC’s full integrationhad been slow, thus calling for an acceleration ofthe implementation process. There was also a needfor member states to show commitment bycontributing extensively towards regional projectsand programmes. The outgoing Chairpersonemphasised that SADC had committed itself toachieving a Free Trade Area by 2008 and a CustomsUnion by 2010 and this called for the resolution ofthe issue of multiple membership, which wasdelaying the progress towards deeper regionalintegration.

Though SADC had not entirely delivered in thearea of eradication of poverty through regionalintegration, it was nevertheless making progresstowards establishing an environment of peace andstability. Progress was recorded in the overall foodsecurity situation. Between 2005 and 2006,member states made progress in implementing theDar-es-Salaam Declaration and Plan of Action,more specifically as regards improving theavailability and access to key agricultural inputs,irrigation development and water management. Inthe area of social and human development, severalprogrammes were implemented during the yearand these were aimed at increasing access toquality social services including education andhealth. In the education field, measures had beentaken to leverage resources to improve access toeducation and training through open and distancelearning as well as the development of the nationaland regional qualifications framework. With respectto gender and development, the overall regionalsituation indicated that SADC member states weremaking progress in the promotion of women’srepresentation in political structures. Moreover, theSummit endorsed the process of drafting theGender Protocol.

The average real GDP growth of 5 per centachieved in 2005 pointed to an overall increase inthe macroeconomic performance of SADCcountries, despite disparities amongst memberstates, with some countries registering reasonably

high growth while others have grown minimally.Angola achieved the highest real GDP growth of15.6 per cent, followed by Botswana with 8.3 percent and Mozambique with 7.7 per cent. Theaverage growth rate for SADC was projected torise to 6 per cent in 2006. Most SADC countriescontinued to tighten their monetary policies andmaintained single digit inflation rates in 2005.Zimbabwe recorded a massive increase in its rateof inflation, which brought the regional averageto 23 per cent. Had Zimbabwe been excludedfrom the computation, the regional averagewould have worked out to 10.8 per cent. Theaverage fiscal balance of SADC improved fromnegative 1.8 per cent of GDP in 2004 to negative0.8 per cent in 2005 while the regional tradebalance for most of the member states worsenedin 2005. The slow progress in the implementationof the Heavily Indebted Poor Countries (HIPC)Debt Relief Initiative saw some SADC economiesincreasing their external debt burden as theycontinued to borrow to finance their povertyreduction programmes.

The Draft Protocol on Finance and Investmentwas tabled at the Summit and was approved as wellas signed. The 2006 Summit also took note of theprogress made with regard to the construction ofthe SADC Headquarters building in Gaborone,Botswana. The summit welcomed the applicationof Seychelles to join SADC and resolved to engagein further consultations on this matter. The AfricanDevelopment Bank (ADB) President informed theSummit that the Bank was committed to workingwith SADC in the implementation of the region’sagenda, especially in the field of infrastructuredevelopment, and that the ADB intended to openadditional offices in a number of SADC countries.

The 2006 Summit approved the conveningof a SADC Conference on Poverty andDevelopment and the Secretariat was directed tomake the necessary preparations in consultationwith Mauritius. The SADC Secretariat was alsomandated to accelerate the process leading tothe establishment of the SADC RegionalDevelopment Fund to finance developmentprojects through the mobilisation of memberstates’ own resources such as pension funds andother regional funding sources.

The Summit noted that the majority of SADCcitizens live below the Poverty Datum Line and thissituation had been aggravated by the cycles ofdrought, the debilitating consequences of the

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Regional Coorperation Annual Report 2006-07

HIV/AIDS pandemic, outbreaks of malaria andother communicable diseases in the region. Theconsiderable efforts that SADC countries had madeto reduce poverty and improve humandevelopment remained significantly challenged asgains achieved so far were incompatible with theminimum Millennium Development Goals target ofreaching the 7 per cent growth if developingcountries are to halve poverty by 2015.

The SADC Extraordinary Summit of Heads ofState and Government was held in October 2006 inSouth Africa and views were exchanged on thescaling up of the implementation of regionaleconomic integration, more specifically thelaunching of the Free Trade Area by 2008, thepreparations for the Customs Union by 2010 andSADC’s position on the African Union Government.The Summit concluded that the SADC Free TradeArea (FTA) was on course and that it would belaunched as planned by 2008. However, sinceSADC trade patterns consist mostly ofcommodities, there was a need to diversify SADCeconomies and increase intra-regional trade andgrowth. Moreover, it was pointed out that theestablishment of the FTA should take cognisance ofdevelopment integration elements such asinfrastructure, poverty alleviation and sustainabledevelopment. The October 2000 Summit alsoreaffirmed its commitment to the establishment ofa SADC Customs Union by 2010. The MinisterialTask Force that had been established at the AugustSummit was directed to undertake and finalise astudy that would evaluate an appropriate model forSADC Customs Union and a road map was also tobe developed.

An additional Extraordinary Summit washeld in Dar-es-Salaam, United Republic ofTanzania in March 2007 with a view to discussthe political, economic and security situation inthe region, with special focus on the situationsin Lesotho, Democratic Republic of Congo (DRC)and Zimbabwe.

The Committee of Central BankGovernors (CCBG) in SADC

During the period 1 July 2006 to 30 June2007, the CCBG met in October 2006 in Pretoria,South Africa and in April 2007 in Dar-es-Salaam,Tanzania. All SADC central banks were representedat both meetings. At their October 2006 meetingGovernors focussed mainly on economic, monetaryand other policy issues of common concern. The

Integrated Paper on Recent Economic Developmentsin SADC prepared by the Bank of Namibia wasdiscussed in detail. The paper highlighted the maineconomic developments in the SADC region andprovided information on a series of macroeconomicindicators as well as the status of macroeconomicconvergence in 2005 and prospects for 2006.Governors also noted that the Finance andInvestment Protocol (FIP) was adopted by the SADCSummit in August 2006 and that ten member stateshad signed the FIP. At the April 2007 meeting, theCCBG focussed on reports on the various projectsthat fall under its responsibility as well as on detailedprocedural and administrative issues.

SADC Payment, Clearing andSettlement Systems

Various activities had been undertaken by theSADC Payment System Project team in thedevelopment of payment systems in the region.The focal point had been the introduction of theReal Time Gross Settlement (RTGS) systems inBotswana and Lesotho, bringing the total numberof RTGS applications in the region to ten. TheSADC Payment System project report, Report onthe Achievements and Highlights during the periodof the World Bank IDF Grant Funding (1996 –2006), was presented at the World Bank GlobalPayment System Week in Sydney, Australia, inOctober 2006. A Payment Systems AnnualRegional Conference was held in Zambia in April2007 and it focussed on the status of developmentsin the national payment system of each SADCcountry, remittances, retail payment system riskreduction, an evaluation of securities settlementsystems and oversight. It was noted that goodprogress had been made as regards thedevelopment of national payment systems, withten countries having implemented RTGS settlementsystems and at least one automated clearingprocess. Operational issues as well as the need fortraining were also discussed.

Exchange Control in SADC Countries

The Subcommittee on Exchange Controlprepared an annual report on the status of SADCmember countries’ current as well as capital andfinancial account convertibility for the year ended31 December 2006. Of the fourteen SADCcountries only three have abolished exchangecontrol. The remaining eleven countries are still atdifferent levels of liberalisation. Generally, the pace


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Annual Report 2006-07 Regional Coorperation

of current account liberalisation has been fasterthan that of the capital and financial account.Transactions requiring central bank approval areincreasingly becoming fewer and in general wherelimits apply, these have been increased.

Moreover, in order not to delay theimplementation of the Regional Indicative StrategicDevelopment Plan (RISDP), the CCBGSubcommittee on Exchange Control prepared adraft policy framework for the liberalisation ofexchange control. The purpose of this framework,which has been submitted to the SADC ExchangeControl Committee for finalisation, was toharmonise exchange control liberalisation in theSADC region. The CCBG Subcommittee onExchange Control was disbanded since the SADCExchange Control Committee was established on 18April 2007.

Legal and Operational FrameworkSteering Committee

Based on the study titled Legal andOperational Frameworks of SADC Central Banks - acomparative study, that was finalised in 2002, theLegal and Operational Frameworks SteeringCommittee prepared a Draft Model Central Bank Billfor SADC central banks. The Working GroupGovernors met on 29 October 2006 to discuss theDraft Bill but owing to time constraints, it wasimpossible to work through the entire document.Moreover, a workshop for all SADC central bankswas held in March 2007 in Pretoria, South Africa andcomments received from non-Working GroupGovernors were incorporated to the Draft Bill, wherepossible. The draft Green Paper and explanatorymemorandum of the Draft Bill were also discussed.It was agreed at the April 2007 CCBG meeting toestablish a Technical Working Group.

SADC Central Banks InformationTechnology Forum

The Information Technology (IT) ForumAnnual Conference was held at the end of February2007 with the purpose of reviewing progressachieved, with a particular focus on the RISDPinitiatives. An assessment of the status of SADCcentral banks as far as the implementation ofBusiness Continuity Management (BCM) isconcerned revealed that banks are at differentlevels of implementation. Currently, with a view toensuring uniformity, the IT Forum is preparing a

document that will outline an approach to serve asguide for central banks in the implementation ofBCM. The IT Forum is also carrying out asituational study in terms of availability of skills inall SADC central banks. The rationale for this studyis to determine the IT skills available within theSADC central banks so as to allow sharing ofexisting skills amongst banks.

SADC Subcommittee of BankingSupervisors (SSBS)

The Head of Banking Supervision Workshop andthe Annual General Meeting were held in April 2007in Windhoek, Namibia. Themes covered during theworkshop included Consolidated Supervision andProblem Bank Resolution. The project on financialsoundness indicators and the development of aregional database are underway and the frequency aswell as the format of the report to be submitted toGovernors were discussed at the Annual GeneralMeeting. It was agreed that the Compilation Guideon Financial Soundness Indicators of theInternational Monetary Fund would be used as aguide for the project. At the April 2007 CCBGMeeting, Mauritius was allocated the chairmanship ofthe SSBS on a permanent basis.

CCBG Macroeconomic Subcommittee

The broad objectives of the CCBGMacroeconomic Subcommittee are to considerSADC macroeconomic matters so as to carrythrough the views of the CCBG as pertains to themacroeconomic convergence programme and toparticipate in the development, monitoring andreview of the implementation programme of theMacroeconomic Convergence Programme asprovided for in the Finance and InvestmentProtocol. The CCBG Macroeconomic Subcommitteealso co-operates with the SADC MacroeconomicSubcommittee to co-ordinate monetary and fiscalpolicy in the region. During the period underreview, the CCBG Macroeconomic Subcommitteewas represented at the SADC MacroeconomicSubcommittee meeting held in Mauritius inNovember 2006 where participants madepresentations on their national macroeconomicconvergence reports. It was recommended that theCCBG Macroeconomic Subcommittee would liaisewith Chief Economists of Central Banks in SADC tofinalise the topics that need to be researched on aswell as the time frame for the latter.


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Regional Coorperation Annual Report 2006-07

COMMON MARKET FOR EASTERNAND SOUTHERN AFRICA (COMESA)

The Common Market for Eastern and SouthernAfrica (COMESA) was set up in 1994, replacing thePreferential Trade Area for Eastern and SouthernAfrica States (PTA), which was established in 1981.The common aspiration is to become a fullyintegrated internationally competitive regionaleconomic community within which there iseconomic prosperity demonstrated by high livingstandards of its people, political and social stability,and free cross-border movement of goods,services, capital and labour. The primary means ofdeveloping trade are trade liberalisation and theadoption of market-oriented policies, which impactfavourably on the allocative efficiency of theeconomies of the member states, thereby resultingin trade creation and expansion, investmentrationalisation and production integration.

COMESA is the largest regional economicgrouping in Africa with 19 member countries.These are: Burundi, Comoros, the DemocraticRepublic of Congo, Djibouti, Egypt, Eritrea,Ethiopia, Kenya, Libya, Madagascar, Malawi,Mauritius, Rwanda, Seychelles, Sudan, Swaziland,Uganda, Zambia and Zimbabwe.

Economic growth in the COMESA region stoodat 7.0 per cent in 2006 despite high oil pricesduring the year. This strong growth is attributablemainly to higher exports of commodities and atmore favourable prices, a significant increase inofficial development assistance composed largely ofdebt relief and emergency assistance, improvedmacroeconomic stability and recovery inagricultural production in some countries. Intra-COMESA trade grew exceptionally by 40.6 per centin 2005 to reach US$6.3 billion from US$4.5 billionin 2004. The integration journey started inDecember 1981 with the signing of the PTA Treaty,and was followed by COMESA in 1994, the FreeTrade Area (FTA) in 2000, and the COMESACommon Investment Area (CCIA) to harmonizeinvestment policies, laws and regulations with theRegional Investment Agency (RIA) based inCairo, Egypt.

Financial System Development andStability

A Financial System Development and StabilityPlan has been approved for implementation. TheFinancial System Development and Stability Sub-

Committee, which is responsible, inter-alia, fordeveloping strategies for diversifying financialinstitutions and instruments at the national andregional levels and sharing experiences on banksupervision and regulation, met on 5-6 March 2007to examine the draft report and proposed guidanceon the COMESA Financial System Development andStability Plan. It discussed the implementation,coordination and evaluation mechanism of theplan, which includes commitment and acceptanceof the proposed guidance by the member states,and the need for the implementation of the plan ata national level to be based on broad participationand consultation in order to create ownership forthe outputs and to internalise the principles uponwhich it is based, with the COMESA Secretariatplaying the role of facilitator and coordinator, andtaking overall responsibility for management ofthe programme.

Meeting of the Chief Executives ofStock Exchanges in the COMESARegion

Following a meeting of the Chief Executives ofStock Exchanges in the COMESA region on 16-17July 2007 in Cairo, Egypt to discuss the prospectsand constraints of integrating capital markets in theregion, an action plan for the advancement of theintegration of capital markets in the COMESAregion and providing for the creation of a SecuritiesMarket Development Committee was approved forsubmission to the Council of Ministers.

Regional Payment and SettlementSystem (REPSS)

The Regional Payment and Settlement System(REPSS), being put in place by the Clearing Houseto improve the flow and settlement of cross-borderpayment transactions among financial institutionsfor the benefit, inter alia, of importers andexporters in the various member countries hasreached the operational stage.

Although REPSS would handle multi-currencies, it would operate as two distinct systemssettling either in US dollar or Euro. A REPSSparticipating central bank will act as the settlementagent, on behalf of the COMESA Clearing House(CCH) and open a CCH US dollar and a CCH euroaccount, at its Central Bank, pending the openingof these accounts at the Federal Reserve Bank ofNew York and the European Central Bank.


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Annual Report 2006-07 Regional Coorperation

Macroeconomic Convergence in 2006

In 2006 the fiscal criterion was missed by 15countries. The weighted average inflation inCOMESA increased from 22.3 per cent in 2005 to30.0 per cent in 2006. Nine countries experiencedsingle-digit inflation rates, owing essentially toprudent monetary policies and generally favourableweather conditions. All countries use indirectmonetary policy instruments.

Interest rates are liberalized in mostcountries. Some countries have exceptionally highreal lending rates and a wide margin betweenlending and deposit rates. This is a reflection ofrelative inefficiency of their banking system.

Most countries have made significant progressin moving towards market-determined exchangerates, thereby reducing overvaluation of theircurrencies, which prevailed during the 1980s andearly 1990s. Many countries graduated to ArticleVIII of the IMF Articles of Agreement and thus fullyremoved restrictions on their current account.

The average growth in the COMESA regionwas 7 per cent in 2006 compared with a growthrate of 7.6 per cent in 2005. Increased exports ofcommodities at higher prices, a significant increasein official development assistance (largely onaccount of debt relief and emergency assistance)improved macroeconomic stability and recovery inagricultural production in some countries more thanoffset the impact of higher oil prices on growth.

The weighted average savings as a percentageof GDP for COMESA countries was 17.5 per cent in2006 compared with 14.0 per cent in 2005. Theweighted average investment as a percentage ofGDP for COMESA countries improved from 16.1 percent in 2005 to 18.5 per cent in 2006.

The weighted average external debt to officialcreditors to GDP ratio for COMESA countriesdecreased from 52.9 per cent in 2005 to 29 percent in 2006. The average level of reserves inCOMESA member countries was sufficient to cover3.3 months of imports of goods and services in2006 compared with 2.6 months of imports ofgoods and services in 2005.

Cost-Benefit Analysis of anAutonomous COMESA MonetaryInstitute versus Using the ExistingStructure of COMESA

The pursuit of closer trade integration andfast-tracking monetary union would need to beundertaken simultaneously. Closer tradeintegration will necessarily raise the need for closermonetary cooperation. Monetary cooperation inturn will facilitate trade integration. It is deemedcrucial to press ahead with the implementation ofthe next stages of the COMESA MonetaryIntegration Programme, namely, currencyconvertibility and exchange rate union, which arecrucial for reducing barriers to trade and speedingup regional integration.

The COMESA Authority of Heads of State andGovernment, meeting in Djibouti on 15-16November 2006, decided that a COMESA MonetaryInstitute (CMI) be established to undertaketechnical, policy, statistical, institutional and legalpreparatory work that would lead to the creation ofa COMESA Monetary Union (CMU), with a singlecurrency issued by a common supra-national centralbank and with common monetary and exchange ratepolicies. Following that decision a ‘Cost-BenefitAnalysis of an Autonomous COMESA MonetaryInstitute versus Using the Existing Structure ofCOMESA’ was carried out. Drawing on the functions,organisation and management structure of someregional monetary institutes which preceded regionalcentral banks, namely, the European MonetaryInstitute and the West African Monetary Institute,the study recommends the setting up of anindependent COMESA Monetary Institute.

Also, the progress achieved in theimplementation of a Regional Payment andSettlement System for the COMESA region as thecore business of the COMESA Clearing House willsignificantly contribute to the expansion of intra-COMESA trade.

The COMESA Monetary and Exchange RatePolicies Sub-Committee undertook a number ofempirical studies, the findings of which are deemedto be helpful for policy making and capacitybuilding in member countries.


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Regulation and Supervision Annual Report 2006-07

2 Regulation and Supervision

The financial strength of an economy isdetermined, amongst others, by the soundnessand stability of its financial sector. An active andaccessible market coupled with fair competitionhas enabled the financial system to expandglobally. The financial strength of an economy isdetermined, amongst others, by the soundnessand stability of its financial sector. An active andaccessible market coupled with fair competitionhas enabled the financial system to expandglobally. Amid the continuous expansion andsophistication of the banking industry, the Bankdeterminedly sustains its effort to strengthen itssupervisory arm. By devoting adequate time andresources at identifying risks efficiently, the Bankaims at mitigating them so that confidenceconstantly perseveres.

The Bank is empowered under the BankingAct 2004 and the Bank of Mauritius Act 2004 toregulate and supervise banks, non-bank deposit-taking institutions, foreign exchange dealers andmoney-changers. With the aim of achieving asound and efficient banking system in the interestof the depositors, the general public and theeconomy as a whole, the Bank applies rigorousstandards in the licensing process and continuouslyregulates and monitors the practice and activities ofinstitutions under its purview through the issue ofprudential regulations and on-site inspection andoff-site surveillance of authorized institutions.

In October 2006, central banks andsupervisory agencies have endorsed the new BaselCore Principles for Effective Banking Supervisionand its Methodology at the InternationalConference of Banking Supervisors held in Mexico.The core principles, which are universally acceptedminimum standards for banking regulation andsupervision, were revised on account of significantimprovements, developments and innovations inthe operations and approaches used by financialinstitutions and supervisors worldwide. In itsendeavour to convey its full dedication andcontinued support to the implementation of the 25core principles, the Bank is constantly improving itsprocesses and upgrading its resources to secure asound and stable financial system. The Bankencourages constructive working relationships at all

times with financial institutions under its purviewtogether with external auditors. Along the sameline, it continues to reinforce its relationship withsupervisors worldwide through regular informationsharing and mutual agreements.

As part of the Financial Sector AssessmentProgram, the International Monetary Fund and theWorld Bank conducted their assessment ofcompliance to the 25 Core Principles in February2007 to assess the Bank’s strengths andweaknesses in its supervisory systems andmethods, and to identify areas for improvement.

In its continued effort to enhance theregulatory environment and mindful of thepotential benefits of Basel II, the Bank hasembarked upon and is committed towards itsimplementation. Given the complexity in adoptingthe new capital standard in the local context and itsimplementation spreading over an extensive timeframe, it was proposed that Basel II be adoptedwith consultation and participation of the entirebanking sector through the establishment of aCommittee alongside. The Committee has set upeight working groups to discuss and devise policyframework in the form of proposal papers onrelevant aspects of Basel II. The Working Groupattends to issues and concerns raised by bankswhile expecting significant input from members.Two presentations to the main committee havebeen held since end-June 2006, namely on InternalRatings-Based Approach and on the use of ExternalCredit Assessment Institutions to the measurementof credit risk, where proposals have been made tomembers. The latter complements the policy paperon the implementation of the StandardizedApproach to Credit Risk while the former requiresthe setting up of a centralized database on lossinformation. The Bank is of the view that, with thebuilding up of a database on historical informationon credit and operational losses, banks will useinternal models and approaches for a finermeasurement of credit risk. Meetings were alsoheld with members of the Working Group onEligible Capital to discuss on the components ofcapital for the Basel II framework. Theimplementation of Basel II is expected to berealized by 2008.


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Annual Report 2006-07 Regulation and Supervision

As at end-June 2007, 18 banks, 13 non-bankdeposit-taking institutions, 5 foreign exchangedealers and 2 money-changers were operating inMauritius. A list of authorized institutions as at 30June 2007 is provided in the Appendix VI.

LEGISLATIVE CHANGES ANDREGULATIONS

LEGISLATIVE CHANGES

1. The Finance Act 2006

The Finance Act 2006, which wasenacted on 7 August 2006, broughtamendments to, inter alia, the BankingAct 2004, the Companies Act 2001, theFinancial Intelligence and Anti-MoneyLaundering Act 2002, the FinancialReporting Act 2004 and the Income TaxAct as follows:

A. The Banking Act 2004

Section 7 - Grant or refusal to grantbanking licence

Subsection (6) of section 7 of the Banking Act2004 which provided that a banking licence shall, inaddition to the name of the licensee and theconditions to which it is subjected, also specify theplace or places at which the licensee is authorisedto conduct banking business, has been repealedand replaced by a new subsection which nowprovides that a banking licence should only specifythe name of the licensee and the conditions towhich it is subjected to. Accordingly, it is no longera requirement for the place or places at which abank is authorised to conduct banking business tobe mentioned on the banking licence.

Section 26 - Other prudential requirements

The reference to section 33 in section 26(1) ofthe Act being mere surplussage has been deletedtherefrom. The words “Sections 7, 10 and 33”appearing in section 26(1) have accordingly beendeleted and replaced by the words “Sections 7and 10”.

Section 42 - Regular examinations

Section 42 has been amended to provide thatthe central bank shall conduct regular examinationsof the operations and affairs of every financialinstitution “at least once every 2 years” instead of“at least once a year” as was formerly the case.

Section 46 - Fit and proper person

In order to ensure that third parties to whomfinancial institutions are outsourcing certain of theirfunctions, are fit and proper, a new subsection (2A)has been inserted immediately after subsection (2)in section 46, which provides that, “No financialinstitution shall outsource any of its functions toany other person unless the central bank issatisfied that the person meets the requirements ofsubsection (3)”.

Section 50 - Automated teller machines

Subsection (1) of section 50 has beenrepealed and replaced by a new subsection whichprovides that where any bank sets up automatedteller machines for the use by customers to makedeposits or cash withdrawals, it shall inform thecentral bank accordingly.

In terms of section 50(2) of the Banking Act2004, where a bank sets up automated tellermachines, it was required to provide such securityfor their operation, and such systems for customerauthentication, terminal receipts and periodicstatements and for physical and logical protectionagainst unauthorized access in any form, as thecentral bank considered adequate. The words, “asthe central bank considers adequate” have beendeleted from this provision.

Banks are accordingly no longer required toseek the approval of the central bank when, interalia, providing security for the operation of theautomated teller machines as was formerly thecase. They are only required to inform the Bankwhen they set up an automated teller machine foruse by customers.

Section 62 - Hours of business

In order to enable the Bank to approve andnot only fix the hours of business of financialinstitutions, the words “the central bank shall fix -”have been deleted from section 62 and replaced bythe words “the central bank shall approve -”.

Section 64 - Confidentiality

(i) Provision has been made in subsection(1)(a) of section 64 for service providerswho by virtue of their professionalrelationship with a financial institutionhave access to the books, accounts,records, financial statements or otherdocuments of the financial institution,whether electronically or otherwise, to


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make a declaration of confidentialitybefore they begin to perform any dutiesunder the banking laws.

A definition of “professional relationship” hasalso been provided in paragraph (b) of thissubsection.

(ii) A new paragraph (l) has been added insubsection (3) to provide that the duty ofconfidentiality shall not apply when afinancial institution, other than a cashdealer, is required to provide informationand particulars, and to do any other act,under Sub-Part BA of Part VIII of theIncome Tax Act.

(iii) In the light of the provisions of theMauritius Revenue Authority Act 2004,the words “the Director-General of theRevenue Authority, the RevenueCommissioner under the UnifiedRevenue Act,” have been deleted insubsection (9), and replaced by thewords “the Director-General of theMauritius Revenue Authority establishedunder the Mauritius Revenue AuthorityAct 2004,”.

Section 70 - Procedures to go into voluntaryliquidation

A new subsection (4) has been added tosection 70 to state that the procedures forvoluntary liquidation under the Banking Act 2004shall be in accordance with the sections and Partsof the Companies Act 1984 specified in theFifteenth Schedule to the Companies Act 2001 andthose sections and Parts shall apply to the extentthat they are consistent with the provisions of PartX of the Banking Act.

Section 97 - Offences and Penalties

Section 97(11) has been amended by deletingthe words “section 34(5)” and replacing them bythe words “section 34(5), (6)” thereby making afailure by a financial institution to submit itsfinancial statements on time an offence.

B. The Companies Act 2001

Section 2 - Interpretation

Amendment has been brought to thedefinition of “small private company” by deletingthe words “10 million rupees” appearing in section2(5) of the Companies Act 2001 and replacing them

by the words “30 million rupees”. Following thesaid amendment a company shall be a "smallprivate company" where, inter alia, it is a privatecompany, the turnover of which, in respect of itslast preceding accounting period, is less than 30million rupees.

Section 68 – Company may acquire or redeemits own shares

Subsection (6) of section 68 which providesthat a company shall immediately following theacquisition or redemption of shares by thecompany, give notice to the Registrar of thenumber and class of shares acquired or redeemed,has been amended to provide that except wheredispensation has been granted under section 52(5),a company shall immediately following theacquisition or redemption of its shares give sucha notice.

Section 86 - Pledges

The words “and any other applicable law” hasbeen added after the words “Code Civil Mauricien”in section 86(1) of the Act thereby providing thatany share or debenture may be given in pledge inall civil and commercial transactions in accordancewith the Code Civil Mauricien and any otherapplicable law.

Section 138 – Removal of directors

Subsection (6) of section 138 has beenamended to provide that a person of or over theage of 70 years may in the case of an applicationfor incorporation of a public company, be appointedwith the consent in writing of the proposedshareholders.

Section 187 – Registered office

Section 187(1) of the Act has been amendedto provide that every company shall, in addition tohaving a registered office in Mauritius, also causeits name and the word “Registered Office” to bepermanently displayed in a conspicuous place inlegible romanised letters on the outside of itsregistered office.

Section 220 - Sending of financialstatements to shareholders who elect not toreceive annual report

The words “in accordance with section 212”appearing in section 220(a) of the Act have beendeleted and replaced by the words “in accordancewith sections 210 and 212 respectively”. Following


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the said amendment section 220(a) of the Actprovides that the Board of a company shall cause tobe sent to every shareholder of the companyreferred to in sections 218 and 219(2), not lessthan 21 days before the annual meeting of theshareholders the financial statements for the mostrecently completed accounting period and signed inaccordance with section 210 and any groupfinancial statements for the most recentlycompleted accounting period and signed inaccordance with sections 210 and 212 respectively.

C. The Financial Intelligence and Anti-Money Laundering Act 2002

Section 5 - Limitation of payment in cash

The words “350,000 rupees” have beendeleted in section 5(1) and replaced by the words“500,000 rupees” thereby authorizing payment incash up to a maximum of Rs500,000 as comparedto Rs350,000 as was formerly the case.

Section 10 - Functions of the FIU

A new paragraph (g) has been added tosubsection 10(2) to enable the FIU to undertake,and assist in, research projects in order to identifythe causes of money laundering and terroristfinancing and its consequences.

Section 19 - Offences relating to obligation toreport and keep records and to disclosure ofinformation prejudicial to a request

With the enactment of the Mutual Assistancein Criminal and Related Matters Act 2003, section23 of the Financial Intelligence and Anti-MoneyLaundering Act 2002 with respect to the provisionof assistance by the FIU to overseas countries wasrepealed. Accordingly, the words “to which section23 applies” appearing in section 19(2)(a) and (b) ofthe Act have been deleted and replaced by thewords “under the Mutual Assistance in Criminal andRelated Matters Act 2003”.

Section 19A-Establishment of NationalCommittee

In the light of the amendments brought aboutby the Bank of Mauritius Act 2004, reference to theformer Managing Director of the Bank of Mauritiushas been rectified by deleting the words “ManagingDirector” appearing in section 19A(2) of the Act andreplacing them by the words “a Deputy Governor”.

D. The Financial Reporting Act 2004

Section 33 - Licencing of auditors

In accordance with section 33(1) of the

Financial Reporting Act 2004, no person shall holdany appointment, or offer any services forremuneration, as an auditor, unless he holds alicence under the Act.

A derogation has been brought to the aboveprovision. The words “No person” in subsection (1)have been deleted and replaced by “Subject tosubsection (1A), no person” and a new subsection(1A) has been inserted immediately aftersubsection (1), which provides that subsection (1)shall not apply to the auditor of a small privatecompany under the Companies Act 2001.

Section 35 – Audit practice by a firm

Paragraph (d) of section 35(4) which providedthat the Council shall not approve the proposedname or any proposed change in the name of anaudit firm where the proposed name or proposedchange in the name is in breach of the BusinessRegistration Act 2002, has been deleted therefrom.

E. The Income Tax Act

One of the major amendments brought aboutby the Finance Act 2006 to the Income Tax Act isthe addition in Part VIII of the Act of a newSub-Part BA entitled “Deduction of tax at source”.The essence of those amendments is given below.

In terms of the provisions of this new Sub-PartBA, income tax at the rate of 15 per cent ischargeable on, inter alia, interest payable todepositors by banks and non-bank deposit takinginstitutions at the time the interest is madeavailable to the depositor. No income tax shallhowever be deducted from the interest payable toa depositor unless the aggregate amount ofdeposits held by the depositor in a financialinstitution including its branches exceeds, at anytime in an income year, 2,000,000 rupees and inrespect of interest which accrued prior to 1October 2006.

Section 111K of the Act also provides that banksand non-bank deposit taking institutions shall, not laterthan 31 July in every year, give to each depositor, astatement of income tax deduction, in duplicate, inrespect of the preceding income year and submit to theDirector-General a statement giving, in respect of thepreceding income year, the particulars of the payee,the amount or sum made available and income taxdeducted there from as well as the aggregate amountof interest payable by the bank or non-bank deposittaking institution including its branches, where suchaggregate amount exceeds 5,000 rupees, whether ornot income tax has been deducted.


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2. The Borrower Protection Act 2007

The Borrower Protection Act 2007 waspassed by the National Assembly on 24January 2007. The Act regulates creditagreements for a sum not exceeding 2million rupees and also establishes theOffice of the Commissioner for theProtection of Borrowers. According tosection 6(1) of the Act, theCommissioner shall-

(a) ensure that proper and adequateinformation is given to borrowersconcerning the proper ways and meansof obtaining a credit facility;

(b) promote public understanding of creditfacilities, including awareness of thebenefits and risks associated with them;

(c) ensure that the terms and conditions of acredit agreement referred to him are notextortionate;

(d) strive to strike a fair balance betweenthe rights and obligations of borrowersand of lenders;

(e) deal with complaints received fromborrowers; and

(f) cause investigations to be conductedand, where appropriate, convenehearings.

According to section 9(1) of the Act, beforegranting a credit facility to any person, every lendershall-

(a) take all reasonable steps to verify thatthe person has, or is likely to have, themeans to repay the amount;

(b) cause the credit agreement to be readout to the person and to the guarantor, ifany;

(c) ascertain whether the person and theguarantor, if any, understand sufficientlythe language in which the creditagreement is drawn up;

(d) where the person or the guarantor doesnot sufficiently understand the languageof the credit agreement, cause to beexplained the contents of the agreementto that person or to the guarantor in alanguage which that personunderstands; and

(e) give a copy of the proposed creditagreement to the person and theguarantor, if any.

Section 10(1) of the Act requires any personapplying for a credit facility to disclose the followinginformation in writing so as to enable a lender toassess his capacity to repay.

(a) all other outstanding credit facilitiesalready granted to him and details of anyother liabilities, terms of repayment,amount still outstanding, or anyinstalments in arrear;

(b) his average monthly expenses;

(c) particulars of his monthly income; and

(d) such other relevant information whichthe lender reasonably requires ofthat person.

Section 10 of the Act also requires a borrowerto immediately notify his lender in writing of theparticulars of any subsequent credit facility whichhe obtains from any other lending institution.Furthermore, where a borrower is unable to payany instalment in due time, he shall immediatelysend a written notification to the lender and theguarantor, if any, informing him of his inability topay, give reasons therefor and seek theconcurrence of the lender regarding arrangementsfor the payment of the instalment in default.According to section 11(e) of the Act, a loan mayonly be recalled on the ground that the borrowerhas failed to –

(i) effect payment of the instalment due-

(A) where repayment of the loan iseffected on a monthly basis, for aperiod of 3 months following thefirst default; or

(B) in any other case, for a period of 6months following the first default;or

(ii) fulfill any other obligation under thecredit agreement.

A borrower may also request to reschedule hisdebt in accordance with section 14 of the Act if heis unable to meet his obligations under a creditagreement as a result of illness, injury, loss ofemployment, death of working spouse or otherreasonable cause of hardship, which affects hiscapacity to repay the debt. Section 15(1) of the Act

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enables a borrower to apply to the Commissioner foran order to reschedule the debt where the lenderdoes not agree to a revision of the terms of a creditagreement or the borrower is not agreeable to therevised terms made pursuant to section 14 of the Act.

The Act also provides for the protection ofimmovable property offered as security. In thisconnection, section 17 obliges the lender not toissue execution on the security without firstreporting the matter to the Commissioner who maydetermine what, in his opinion, is the most suitableway to avoid the seizure and sale of the immovableproperty, after enquiring into the matter and, inparticular, the financial situation of the borrowerand hearing the parties. In this regard, theCommissioner may order-

(i) the temporary suspension of theperiodicity or amount of any payment tobe made;

(ii) where he is of opinion that the creditagreement is extortionate having regardto all the circumstances of the case, thewaiving or write off of any interestcharged; or

(iii) a rescheduling of the periodicity oramount of the payments; and

he may hold a conciliation sitting between theparties, draw up any scheme or arrangementagreed upon and determine that theimplementation of such scheme or arrangement besubject to his supervision.

According to section 18 of the Act, where aborrower considers that his credit agreement isextortionate, he may report the matter to theCommissioner who shall carry out an enquiry andhear the parties. Where the Commissioner issatisfied that the credit agreement is extortionate,he may make an order directing the lender to:amend the terms and conditions of the creditagreement, repay to the borrower any excessamount paid, indemnify the borrower or any otherperson prejudiced by the agreement in such sumand on such terms as may be imposed by him ormake such other order as he thinks fit.

A credit agreement is extortionate where itrequires the borrower to make payments which areexorbitant or otherwise contravenes ordinaryprinciples of fair dealing.

Section 20 of the Act prescribes the methodsof sale of mortgaged property where the

Commissioner is satisfied that all possible means ofdoing otherwise than as provided for in sections14,15, 17 and 18 of the Act have been exhausted.In the first instance, the Commissioner shallauthorize the borrower or the guarantor, if any, tosell, within such time as he may determine, themortgaged property by private contract. The saleby private contract shall be under the supervisionof the Commissioner and he shall be satisfied thatthe price offered reflects the market value of theproperty, as recommended by the ChiefGovernment Valuer in writing.

If the property is not sold within the allowedperiod, the price offered does not reflect the marketvalue of the property or there is no potential buyer,then proceed with sale of the property by calling forsealed offers in such manner as may be prescribed.The Commissioner may, on the recommendation ofthe Chief Government Valuer, approve the sale ofthe property to the highest bidder.

The distribution of the proceeds of the sale ofan immovable property under the Act shall begoverned by the provisions of the Sale ofImmovable Property Act.

3. Proclamation of Sections 3 (3) ofPart I and 12(5) of Part II, Parts IXto XI of the Banking Act 2004

By virtue of Proclamation No.6 of 2007,as published in the Government Gazetteof 31 May 2007, sections 3(3) of Part Iand 12(5) of Part II, Parts IX to XI of theBanking Act 2004 have come intooperation on 1 June 2007 and cover thefollowing:

Section 3(3) of Part I – PRELIMINARY -provides that “where a bank is also engaged in anyof the financial services regulated by the FinancialServices Development Act 2001, the bank shall notcarry on business by virtue of its banking licenceunless it is also licensed under that Act in respectof those financial services”.

Section 12(5) of Part II - LICENSING OFBANKS AND OTHER FINANCIAL INSTITUTIONS -stipulates that “a non-bank deposit takinginstitution shall be subject to the same prudentialregulation as a bank, including the provisions of PartIII, Part IV, Part V and Part VI and any guidelinesand instructions issued thereunder and the existingterms and conditions of non-bank deposit takinginstitutions shall stand amended to that effect”.

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PART IX – CONSERVATORSHIP - providesthat “where the central bank deems it necessary inorder to protect the assets of a financial institutionfor the benefit of its depositors and other creditors,it may appoint a conservator, which may be thecentral bank or any other person directed by thecentral bank to be conservator”. It defines thepowers and duties of the conservator, the term ofoffice and remuneration of the conservator, theresumption of office by directors upon conclusion ofconservatorship and the rehabilitation orreorganisation of the financial institution.

PART X - VOLUNTARY LIQUIDATION - definesthe procedures to be followed by a financialinstitution which proposes to go into voluntaryliquidation. It states the manner in which thefinancial institution shall give notice and publicationof the voluntary liquidation, the rights of depositorsand creditors, and the need for the financialinstitution to distribute its assets among itsshareholders after the discharge of all itsobligations and the revocation of its licence. Itfurther stipulates that “where the central bank findsthat the assets of a financial institution whosevoluntary liquidation has been authorised shall notbe sufficient for the full discharge of all of itsobligations or that completion of the voluntaryliquidation is unduly delayed, it shall appoint anyperson as receiver, to take possession of thefinancial institution and commence proceedingsleading to its compulsory liquidation in conformitywith the procedures specified in Part XI”.

PART XI - COMPULSORY LIQUIDATION -defines, inter alia, the circumstances in which theBoard shall appoint a receiver to take possession ofa financial institution, the duties and powers of thereceiver and the powers of the central bank underthis part. It also provides for an inventory of assets,the dealing with claims by the receiver, the priorityof claims, the submission of audited accounts toBankruptcy Court, the liquidation of the financialinstitution and the civil and criminal actions.

REGULATIONS

1. Financial Intelligence and Anti-Money Laundering (Amendment)Regulations 2006

These regulations, which have beenmade by the Minister on 15 September2006 under section 35 of the Financial

Intelligence and Anti-Money LaunderingAct 2002, have amended the FinancialIntelligence and Anti-Money LaunderingRegulations 2003 as follows.

(a) in regulation 2, by deleting the definition“group introducer” and replacing it bythe following definition-

“group introducer” means an introducerwhich is part of the same group as therelevant person to whom the applicantfor business is introduced and is, foranti-money laundering purposes, subjectto either the consolidated supervision ofa regulator in Mauritius or in anequivalent jurisdiction or is subject to theanti-money laundering regulations of aregulator in Mauritius or in an equivalentjurisdiction;

(b) by revoking regulation 5 and replacing itby the following regulation-

5. (1) it shall not be a requirement for arelevant person to comply withidentification procedures where-

(a) the applicant for business-

(i) is itself a bank, a financialinstitution or a cash dealer;and

(ii) is based either in Mauritius orin an equivalent jurisdiction;

(b) in respect of a life insurance policy-

(i) the annual premium does notexceed 40,000 rupees; or

(ii) the single premium does notexceed 100,000 rupees; or

(c) the proceeds of a one-offtransaction are not paid, but aredirectly reinvested in anothertransaction on behalf of the personto whom the proceeds are payable,provided the relevant person keepsa record of those transactions.

(2) Every relevant person shall, in thecircumstances referred to in paragraph (1)(a),obtain and retain from the applicant forbusiness, written documentary evidence ofthe existence of its legal entity and of itsregulated status.

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2. Banking (Processing and LicenceFees) Regulations 2007

These Regulations have been made on 3April 2007 by the Bank of Mauritius withthe approval of the Minister undersections 5(4)(h), 8, 12(4) and 14(2)(b)(5) of the Banking Act 2004.

The regulations which came intooperation on 15 April 2007 set out theannual licence fees for holders ofbanking, non-bank deposit-taking,foreign exchange dealer and money-changer licences as follows:

BANKING LICENCE . . . . . . . . . . Rs

Processing fee . . . . . . . . . . . . .90,000

Fixed . . . . . . . . . . . . . . . . . . .600,000

DEPOSIT-TAKING BUSINESSLICENCE . . . . . . . . . . . . . . . . . . Rs

Fixed fee . . . . . . . . . . . . . . . .300,000

FOREIGN EXCHANGE DEALERLICENCE . . . . . . . . . . . . . . . . . . Rs

Processing fee . . . . . . . . . . . . .25,000

Fixed fee . . . . . . . . . . . . . . . .300,000

MONEY-CHANGER LICENCE . . .Rs

Processing fee . . . . . . . . . . . . .10,000

Fixed fee . . . . . . . . . . . . . . . .150,000

Holders of banking and non-bank deposit-taking licences are also subject to an additional fee computedas per the under-mentioned formula and rounded up to the nearest 10,000 rupees:

Fee (in Rs) = 3-year average gross operating income of the institution x Rs3mnAggregate 3-year average operating income of banks and NBDTIs

+ 3-year average total assets of the institution x Rs1.5mnAggregate 3-year average total assets of banks and NBDTIs

where “NBDTIs” means non-bank deposit-taking institutions.

The annual licence fee

(a) shall, in respect of every holder of abanking licence or of a licence to carry ondeposit-taking business, be determinedby the central bank and communicated inwriting to that bank or non-bank deposit-taking institution, as the case may be;

(b) shall be revised by the central bank afterevery 3-year period starting as from 1July 2006; and

(c) shall not exceed 2 million rupees duringthe initial 3-year period.

The additional fee shall be computed by thecentral bank –

(a) for the initial 3-year period, on the basisof figures for the years 2003, 2004 and2005; and

(b) for subsequent 3-year periods, on thebasis of figures for the 3 years precedingthe year in which the licence fee is duefor revision by the central bank.

Any processing fee or licence fee referred to inthese regulations –

(a) shall be non-refundable;

(b) shall be paid to the central bank inMauritius currency or in US dollars at therate of 1 US dollar to 33 Mauritius Rupees.

3. Borrower Protection (Amendmentof Schedule) Regulations 2007

The regulations which have been madeby the Minister under section 22 of theBorrower Protection Act 2007 on 20 April2007 and came into operation on 27 April2007, have amended the SecondSchedule to the Act by deleting the item‘A leasing company’.

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Basel II Implementation

1. Proposal Paper on Measurement andManagement of Market Risk

Market risk can be defined as the riskthat changes in market prices willadversely affect the value of on- or off-balance sheet positions. Market pricescan be influenced by many factors, themain ones being movements in equityprices, interest rates, currency exchangerates or commodity prices.

The 1988 Capital Accord (Basel I) requiresbanks to hold regulatory capital against creditrisk. In 1996, the “Amendment to the CapitalAccord to Incorporate Market Risks”, more simplyknown as the 'Market Risk Amendment', waspublished and updated in April 1998 and November2005, successively. The Market Risk Amendmentrequires that banks also hold regulatory capitalagainst market risk.

The Proposal Paper deals with themeasurement and management of market risk. Itis applicable to all banks in Mauritius, and isconsistent with the approach recommended by theBasel Committee on Banking Supervision (BaselCommittee) in its 'Market Risk Amendment' paperand the “Principles for the Management andSupervision of Interest Rate Risk” paper issued inJuly 2004.

2. Guideline on Standardised Approach to Credit Risk

The Basel Committee proposes two broadmethodologies to banks for calculatingtheir capital requirements in respect ofcredit risk. One alternative is to measurecredit risk in a standardised manner,based on external credit assessments.The other, which is subject to the explicitapproval of the regulator, allows banks touse their internal rating systems tomeasure credit risk.

The Guideline on Standardised Approachto Credit Risk provides a frameworkwhereby banks in Mauritius are requiredto apply a uniform approach to themeasurement of risks relating to theiron- and off-balance sheet creditexposures for capital adequacypurposes. A departure from theStandardised Approach to the InternalRatings-based Approach is only

permissible with the approval of theBank of Mauritius (the Bank).

The ratings of three well-known externalcredit assessment institutions (ECAIs),namely, Standard & Poor’s Corporation,Moody's Investor Services and FitchRatings are recognised for the purpose ofallocating risk-weights to claims oncounterparties and exposures. The Bankmay recognise, at its discretion, theratings of any other ECAIs uponapplication by the ECAI or a bank onbehalf of the ECAI provided that theeligibility criteria are met in line with therequirements of the proposal paper onthe recognition and use of ECAIs.

The Guideline on Standardised Approachto Credit Risk also permits banks to useconsensus country risk scores of ExportCredit Agencies (ECAs) to determine riskweights for claims on sovereigns in caseswhere countries are not rated by eligibleECAIs. However, the ECAs must publishtheir consensus country risk scores andsubscribe to the OECD agreedmethodology in order for them to qualifyfor the calculation of capital requirements.

3. Proposal Paper on the Recognition and Useof External Credit Assessment Institutions

The use of ECAIs stems from the needfor credit assessments as a basis forcapital requirement calculations in theStandardised Approach to Credit Risk. Inthis perspective, a Proposal Paper on theRecognition and Use of External CreditAssessment Institutions has beencirculated in May 2007 to the bankingindustry for consultation.

The proposal paper defines an eligibleECAI as an entity, other than an ExportCredit Agency (ECA), that issues externalcredit assessments, and that has beendetermined by the Bank to meet theeligibility requirements.

Two methods of recognition are proposed:

Direct Recognition

Under the direct recognition scheme, the Bankshall conduct an evaluation of an ECAI’s compliancewith six eligible criteria, namely, Objectivity,Independence, International Access/Transparency,Disclosure, Resources and Credibility.

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Indirect Recognition

Under the indirect recognition scheme, theBank shall recognise an ECAI based on therecognition criteria of another jurisdiction providedthat the criteria comply with the requirements ofthe Basel Committee.

The Bank shall publish a list of all eligibleECAIs, under both the direct and indirect scheme,for which it has granted recognition. The list shallinclude a description of the market segments forwhich recognition has been granted and theassigned risk weights which correspond to theirrating categories.

PERFORMANCE OF THE BANKINGSECTOR

Overview

During 2006-07, the on-balance sheet assetsof banks increased by Rs132,608 million, or 27.0per cent, from Rs491,291 million at end-June 2006to Rs623,899 million at end-June 2007, comparedto a growth of 17.9 per cent in the preceding year.Off-balance sheet items increased by 26.9 per cent,from Rs35,056 million to Rs44,498 million duringthe same period.

Banks' total advances increased by Rs81,165million, or 35.8 per cent, from Rs226,580 million atend-June 2006 to Rs307,745 million at end-June2007, compared to a rise of 31.9 per cent in thepreceding year. The ratio of total advances to totalassets stood at 49.3 per cent at end-June 2007compared to 46.1 per cent at end-June 2006.

Total deposits of banks went up by Rs90,713million, or 26.3 per cent, from Rs344,441 million atend-June 2006 to Rs435,154 million at end-June2007, compared to a growth rate of 11.1 per centin the previous year. Deposits accounted for 69.7per cent of banks' total funds at end-June 2007 asagainst 70.1 per cent a year earlier.

During the same period, banks' investment inTreasury Bills, other Government Securities andBank of Mauritius Bills decreased by Rs1,959million, from Rs47,945 million to Rs45,986 millioncompared to an increase of Rs2,262 million, or 5.0per cent in 2005-06. The share of such investmentin banks’ total assets decreased from 9.8 per centat end-June 2006 to 7.4 per cent at end-June 2007.

Risk Weighted Capital Adequacy Ratio

Capital adequacy ratio is a measure of theadequacy of a bank’s capital resources in relation toits risk weighted assets and banks in Mauritius arerequired to maintain, at all times, a minimumcapital adequacy ratio of 10 per cent.

At end-June 2007, all banks maintained acapital adequacy ratio in excess of the minimumrequirement of 10 per cent, with ratios rangingfrom 10.7 per cent to 78.1 per cent.

The risk weighted capital adequacy ratio ofbanks excluding operational risk declined from 17.0per cent at end-June 2006 to 15.5 per cent at end-June 2007. This drop was the result of a highergrowth rate of 39.7 per cent registered in the totalrisk weighted assets as opposed to a growth of only27.6 per cent in the aggregate capital base. Theinclusion of risk weighted assets relating tooperational risk resulted in a further drop in theaverage capital adequacy ratio to 14.4 per cent forthe banking sector at end-June 2007.

Aggregate capital base comprising tier 1 andtier 2 (net of deductions) increased by Rs8,288million, or 27.6 per cent, from Rs30,067 million atend-June 2006 to Rs38,355 million at end-June2007. The share of tier 1 capital in gross capitaldecreased from 83.1 per cent at end-June 2006 to80.6 per cent at end-June 2007.

At end-June 2007, the banking sector’son-balance sheet assets in the 100 per cent riskweight bucket accounted for the highest share at 39.2per cent while assets held in the zero per cent riskweight bucket accounted for 18.2 per cent of total on-balance sheet assets. Assets held in the 10 per cent,20 per cent and 50 per cent risk weight bucketsrepresented respectively 0.2 per cent, 39.0 per centand 3.4 per cent of total on-balance sheet assets.

Table 2.1 shows the risk weighted capitaladequacy ratios maintained by banks on a quarterlybasis from end-June 2006 to end-June 2007.

Non-Performing Advances

Non-performing advances of the bankingsector fell from Rs7,740 million at end-June 2006to Rs7,220 million at end-June 2007. The ratio ofnon-performing advances to total advances in thebanking sector dropped from 3.4 per cent to 2.3per cent during the period under review, mainly onaccount of the growth of 35.8 per cent recorded inadvances.

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Specific provisions for loan losses made bybanks rose by 12.9 per cent, from Rs3,441 millionat end-June 2006 to Rs3,886 million at end-June2007. Consequently, the ratio of specific provisionsto non-performing advances went up from 44.5 percent at end-June 2006 to 53.8 per cent at end-June2007. Likewise, provisions on portfolio assessedadvances grew from Rs507 million at end-June2006 to Rs1,008 million at end-June 2007.

The Mauritius Credit Information Bureau(MCIB) was set up under section 52 of the Bank ofMauritius Act 2004 with the objective of being arepository of credit information, both positive andnegative, on account holders. As from 1 December2005, it is mandatory for participants, whichcomprise eleven banks, to consult the MCIB forcredit information before granting any facility.Thus, banks should be able to monitor theirexposures and take informed credit decision.

Profitability

The consolidated position of the profit and lossaccounts of banks is based on the combinedaudited data available at different financial year-ends. All banks, with the exception of three banks,have realized profits during the year 2006/07.

As may be observed in table 2.2, theaggregate pre-tax profits of banks went up byRs2,032 million, or 25.8 per cent, from Rs7,890million in 2005/06 to Rs9,922 million in 2006/07.

Interest income, which represented 85.4 percent of total income, went up by Rs9,493 million, or44.7 per cent, from Rs21,250 million in 2005/06 toRs30,743 million in 2006/07. It is noted thatincome derived from placements and loans tobanks registered an increase of Rs5,423 million, or134.0 per cent. Total interest expense also rose byRs7,736 million, or 64.5 per cent, to reachRs19,736 million in 2006/07. Net interest incomeincreased by Rs1,757 million, or 19.0 per cent,from Rs9,250 million in 2005/06 to Rs11,007million in 2006/07.

Income arising from fees and commissions,and profit from dealing in foreign currenciesaccounted for 94.4 per cent and 80.5 per cent oftotal non-interest related revenue in 2005/06 and2006/07, respectively. Non-interest expenses,consisting of staff costs and other operatingexpenses, rose to Rs5,760 million, or 10.5 per cent,in 2006/07.

Charts 2.1 and 2.2 depict the trends in thecomponents of income and components of net interestincome of banks for the period 2002/03 to 2006/07.

Tables 2.2 and 2.3 give the consolidated profitperformance of banks in 2005/06 and 2006/07.

The charge for bad and doubtful debts to theprofit and loss account went up by Rs103 million, or20.1 per cent, from Rs512 million in 2005/06 toRs615 million in 2006/07.

Tier 1 Capital 26,987 30,318 32,414 30,525 32,617

Tier 2 Capital 5,504 5,802 7,513 7,604 7,855

Total Gross Capital 32,491 36,120 39,927 38,129 40,472

Deductions 2,424 2,556 2,537 2,544 2,117

Total Net Capital (A) 30,067 33,564 37,390 35,585 38,355

Total Risk Weighted Assets (B) 177,244 201,350 226,890 238,929 247,582

Risk weighted on-balance sheet assets 160,054 183,979 208,202 220,227 227,151

Risk weighted off-balance sheet assets 15,583 15,968 17,225 17,413 18,787

Foreign exchange rate and interest rate

related contracts 472 529 434 422 726

Foreign currency exposure 1,135 874 1,029 867 918

Risk Weighted Capital Adequacy Ratio excluding

operational risk (A/B) 17.0% 16.7% 16.5% 14.9% 15.5%

Total Risk Weighted Assets for Operational Risk (C) 16,545 16,670 16,925 18,605 19,140

Total Risk Weighted Assets (B + C) 193,789 218,020 243,815 257,534 266,721

Overall Ratio 15.5% 15.4% 15.3% 13.8% 14.4%

As at end of period

(Rs million)

Jun-06 Sep-06 Dec-06 Mar-07 Jun-07

Table 2.1: Risk Weighted Capital Adequacy Ratio

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85


The pre-tax return on average total assets for

the banking sector declined from 1.9 per cent in

2005/06 to 1.8 per cent in 2006/07 and ranged

from negative 2.8 per cent to positive 4.4 per cent

with eight banks achieving a pre-tax return on

average assets of over 2.0 per cent.

On the other hand, the post-tax return on

equity of banks improved from 18.8 per cent in2005/06 to 21.1 per cent in 2006/07 and rangedfrom negative 35.3 per cent to positive 70.3 percent with six banks achieving a return on equity ofover 20.0 per cent. The improvement in the returnon equity was mainly due to the reduction incorporation tax rate and to investment in higher-yielding assets.

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

2002/03 2003/04 2004/05 2005/06 2006/07

Rs million

Operating Income

Operating Profit

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

22,000

24,000

26,000

28,000

30,000

32,000

2002/03 2003/04 2004/05 2005/06 2006/07

Rs million

Net Interest Income

Chart 2.1: Components of Income

Net Interest Income

Other Income

All figures are for the period.

Chart 2.2: Components of Net Interest Income

Interest Income

Interest Expense


Interest Income from Advances, Placements and Investments 21,250 30,743

Less Interest Expense on Deposits and Borrowings 12,000 19,736

Net Interest Income 9,250 11,007

Add Non-interest Income 4,141 5,272

Operating Income 13,391 16,279

Less Staff and Other Operating Expenses 5,211 5,760

Operating Profit before Bad and Doubtful Debts and Taxation 8,180 10,519

Less Charge for Bad and Doubtful Debts 512 615

Operating Profit before Taxation 7,668 9,904

Add Share of Profits in subsidiaries and associates 232 -

Add/(Less) Exceptional Items (10) 18

Profit before Tax 7,890 9,922

Table 2.2: Consolidated Profit Performance 1

2005/06 2006/07

(Rs million)

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Chart 2.3 shows the returns on equity and onaverage assets for banks for the period 2002/03 to2006/07. Chart 2.4 depicts the evolution of theconsolidated operating profit and profit after tax ofbanks for the period 2002/03 to 2006/07.

NON-BANK FINANCIAL INSTITUTIONS

As at 30 June 2007, thirteen non-bankdeposit-taking institutions were licensed under

section 12 (2) of the Banking Act 2004. Their totalassets amounted to Rs31,335 million at end-June2007. Total deposits mobilized by these institutionsstood at Rs19,480 million, representing 62.2 percent of their resources.

Total credit facilities extended by non-bankdeposit-taking institutions amounted to Rs25,250million and accounted for 80.6 per cent of totalassets. Securities, placements and other investmentsstood at Rs4,075 million at end-June 2007.

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

2002/03 2003/04 2004/05 2005/06 2006/070

3

6

9

12

15

18

21

24

Return onAverage Assets(Per cent)

Return onEquity

(Per cent)

Return on Equity

Chart 2.3 : Return on Equity and on Average Assets

Return on Average Assets


0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

2002/03 2003/04 2004/05 2005/06 2006/07

Rs million

Chart 2.4 : Consolidated Operating Profit and Profit after Tax

Operating Profit

Profit after tax


Operating Profit before Bad and Doubtful Debts and Taxation 8,180 10,519

Less Charge for Bad and Doubtful Debts 512 615

Operating Profit before Taxation 7,668 9,904

Profit before Tax 7,890 9,922

Profit after Tax 6,899 8,929

Pre-tax Return on Average Assets (Per cent) 1.9 1.8

Pre-tax Return on Equity (Per cent) 21.5 23.4

Post-tax Return on Equity (Per cent) 18.8 21.1

Table 2.3: Financial Performance

2005/06 2006/07

(Rs million)

BOM_AR pg 1-118_06/08 6/8/08 09:57 Page 86

3 Financial Market Developments

MONEY MARKET ACTIVITY

On the money market, conditions remainedliquid with an estimated monthly average excess ofRs858 million during 2006-07. The Bank, based onits daily liquidity-forecasting framework, carried outopen market operations to mop up excess liquidityfrom the money market.

Primary Auctions of Treasury/Bank ofMauritius Bills

In 2006-07, Government implemented asmoothing process to determine the nominal issuesof Treasury Bills so that they were spread out moreevenly during the year. In addition, the Bank ofMauritius has been announcing a range for themonthly issues of Treasury Bills.

During 2006-07, Treasury/Bank of MauritiusBills totalling Rs94,875 million were put on tenderat the 52 primary auctions that were carried out.Bids to the tune of Rs114,074 million were receivedand a total amount of Rs67,291 million wasaccepted, out of which Bank of Mauritius Billsaccounted for Rs8,100 million. The total amount ofbids accepted represented 70.9 per cent of the totaltender amount compared to 88.0 per cent in 2005-06, and 59.0 per cent of the total amount of bidsreceived compared to 46.7 per cent in thepreceding year.

The shares of banks and of the non-banksector in total bids received were 75.9 per cent and24.1 per cent, respectively, in 2006-07 comparedto 77.5 per cent and 22.5 per cent in 2005-06.During the period under review, a total nominalamount of Rs1,792.3 million of Treasury Bills wasunderwritten by the Secondary Market Cell of theBank of Mauritius at the primary auctions.

In 2006-07, investors’ preference for 364-dayTreasury/ Bank of Mauritius Bills accounted for 37.4per cent of total bids received while 91-day and182-day Treasury/Bank of Mauritius Bills accountedfor 35.5 per cent and 27.1 per cent, respectively.

The weighted average yields onTreasury/Bank of Mauritius Bills of all threematurities generally increased in 2006-07 in linewith the hikes in the Lombard Rate. The weightedaverage yield on 91-day Treasury/Bank ofMauritius Bills moved up by 578 basis points, from6.97 per cent in July 2006 to a peak of 12.75 percent in January 2007, before going down to 11.04per cent in June 2007. The weighted average yieldon 182-day Treasury/Bank of Mauritius Billsincreased by 547 basis points from 7.46 per cent inJuly 2006 to peak at 12.93 per cent in January2007, before moving down to 11.48 per cent inApril 2007 and finally to 11.10 per cent in June2007. The weighted average yield on 364-dayTreasury/Bank of Mauritius Bills rose by 549 basispoints, from 7.88 per cent in July 2006 to a high of13.37 per cent in January 2007, before falling to10.94 per cent and 10.98 per cent in April and June2007, respectively.

The monthly overall weighted average yieldon Treasury/ Bank of Mauritius Bills, which stood at7.35 per cent in July 2006 peaked at 13.13 per centin February 2007 before declining to 11.04 per centin June 2007. The overall weighted average yieldincreased from 7.11 per cent in 2005-06 to 11.09per cent in 2006-07.

Table 3.1 and Charts 3.1 and 3.2 give detailedinformation on the auctioning of Treasury/Bank ofMauritius Bills in 2006-07.

87

Annual Report 2006-07 Financial Market Developments


88

Financial Market Developments Annual Report 2006-07

2006

Jul 4 5,400.0 16,695.0 5,400.0 6.97 7.46 7.88 - 7.35

Aug 4 3,025.0 5,338.4 2,918.4 7.02 7.41 7.86 - 7.30

Sep 5 11,850.0 3,994.0 3,398.0 9.40 8.37 9.58 - 9.21

Oct 4 5,925.0 3,286.0 3,107.0 10.07 10.16 10.37 - 10.21

Nov 4 5,950.0 2,750.0 2,202.0 10.51 10.75 11.03 - 10.74

Dec 5 17,275.0 6,763.0 6,381.0 11.68 11.92 12.37 - 11.98

2007

Jan 4 7,000.0 7,149.0 5,658.0 12.75 12.93 13.37 - 13.07

Feb 4 4,000.0 6,306.0 3,777.0 12.70 12.86 13.34 - 13.13

Mar 5 12,500.0 20,494.0 12,500.0 12.02 11.96 11.93 - 11.94

Apr 4 9,300.0 15,994.9 9,300.0 11.70 11.48 10.94 - 11.52

May 4 4,000.0 9,626.8 4,000.0 11.56 11.74 11.64 - 11.65

Jun 5 8,650.0 15,677.6 8,650.0 11.04 11.10 10.98 - 11.04

2006-07 52 94,875.0 114,074.7 67,291.4 10.78 10.64 11.63 - 11.09

2005-06 50 58,450.0 110,104.4 51,421.8 6.40 7.12 7.46 7.17 7.11

Weighted Average Yield

91-Day 182-Day 364-Day 728-Day Overall

Table 3.1: Auctioning of Treasury / Bank of Mauritius Bills

(Rs million) (Per cent per annum)

AmountAccepted 1

AmountReceived

TenderAmount

Number ofAuctions

Held

1 Excludes underwriting by the Secondary Market Cell (SMC) of the Bank of Mauritius.

Repurchase Transactions

The Bank carried out a total of 39 reverserepurchase transactions in 2006-07 with a view tomopping up excess liquidity from the moneymarket. Bids totalling Rs93,324 million werereceived, of which a total amount of Rs24,315million was accepted. The reverse repurchaseperiods varied between 1 to 4 days. The overallweighted yield on reverse repos rose to 7.95 percent in 2006-07 from 3.13 per cent in 2005-06.

During 2006-07, only 4 repurchasetransactions were conducted by the Bank forrepurchase periods varying between 1 to 3 days.Bids totalling Rs5,375 million were received andaccepted. The repurchase transactions werecarried out at a fixed rate of 9.00 per cent, hencethe overall weighted yield on repurchasetransactions was 9.00 per cent in 2006-07compared to 5.49 per cent in 2005-06.

During the year under review, no repurchasetransactions among banks were reported tothe Bank.

Table 3.2 provides details on the repurchasetransactions carried out by the Bank in 2006-07.

0

5,000

10,000

15,000

20,000

25,000

Jul-

06

Aug

-06

Sep-

06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb-

07

Mar

-07

Apr

-07

May

-07

Jun-

07

Bids Received

Bids Accepted

Tender AmountBills Maturing

Rs million

Chart 3.1: Auctioning of Treasury / Bank of Mauritius Bills


89


Chart 3.2: Weighted Average Yields on Treasury / Bank of Mauritius Bills at Primary Auctions

7.0

8.0

9.0

10.0

11.0

12.0

13.0

Jul-

06

Aug

-06

Sep-

06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb-

07

Mar

-07

Apr

-07

May

-07

Jun-

07

182-DayPer cent per annum

6.0

7.0

8.0

9.0

10.0

11.0

12.0

13.0

Jul-

06

Aug

-06

Sep-

06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb-

07

Mar

-07

Apr

-07

May

-07

Jun-

07


7.5

8.5

9.5

10.5

11.5

12.5

13.5

Jul-

06

Aug

-06

Sep-

06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb-

07

Mar

-07

Apr

-07

May

-07

Jun-

07


7.0

8.0

9.0

10.0

11.0

12.0

13.0

14.0

Jul-

06

Aug

-06

Sep-

06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb-

07

Mar

-07

Apr

-07

May

-07

Jun-

07

OverallPer cent per annum

2006

Jul - - - - - - - 1 4,095 700 3 3.50-4.00 4.00 3.77

Aug - - - - - - - - - - - - - -

Sep - - - - - - - - - - - - - -

Oct - - - - - - - - - - - - - -

Nov - - - - - - - - - - - - - -

Dec - - - - - - - 2 8,980 2,000 1 8.00 8.00 8.00

2007

Jan - - - - - - - 11 23,109 15,695 1-3 8.00 8.00 8.00

Feb 4 5,375 5,375 1-3 9.00 9.00 9.00 3 4,222 4,222 2-3 8.00 8.00 8.00

Mar - - - - - - - 9 22,275.5 14,010 1-3 8.00 8.00 8.00

Apr - - - - - - - 10 26,210 15,305 1-4 8.00 8.00 8.00

May - - - - - - - 3 4,432 3,360 1-2 8.00 8.00 8.00

Jun - - - - - - - - - - - - - -

2006-07 4 5,375 5,375 1-3 9.00 9.00 9.00 39 93,324 55,292 1-4 3.50-8.00 8.00 7.95

2005-06 2 1,370 1,370 2 - 7 5.25-5.75 5.25 5.49 7 24,315 4,600 2-3 2.50-3.50 3.50 3.13

Table 3.2: Repurchase Transactions Between the Bank of Mauritius and Banks

(Rs million) (Day/s) (Per cent per annum) (Rs million) (Day/s) (Per cent per annum)

WeightedYield on

BidsAccepted

Range ofYields on

BidsReceived

Repur-chasePeriod

AmountAccepted

AmountReceived

Number of

Transactions

WeightedYield on

BidsAccepted

LowestYield

Accepted

Range ofYields on

BidsReceived

Repur-chasePeriod

AmountAccepted

AmountReceived

Number of

Transactions

HighestYield

Accepted

Repurchase Transactions held Reverse Repurchase Transactions held

Note: Effective 18 December 2006, the Bank implemented a new Monetary Policy Framework whereby repurchase transactions are conducted at the key Repo rate ± 50basis points.

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90


Interbank Transactions

The interbank money market allows liquidityredistribution among banks. Funds are availableeither at call (overnight), at short notice (up toseven days) or at term (more than seven days) ona non-collateralised basis.

In 2006-07, an increase of 38.3 per cent wasrecorded in the value of interbank transactions,which amounted to Rs140,325 million comparedto Rs101,496 million in 2005-06. The dailyaverage amount of interbank transactionsincreased from Rs296 million in 2005-06 to Rs394million in 2006-07.

Transactions were mainly carried out in the callmoney market where they totalled Rs110,834 million,representing an increase of 18.6 per cent compared tothe previous year. This represented a daily averagetransaction amount of Rs313 million compared toRs296 million in 2005-06. Call money transactionspeaked at Rs1,295 million in August 2006 and wereat a low of Rs1 million in March 2007.

During 2006-07, transactions at short noticeon the interbank money market totalled Rs16,406million, representing a daily average amount ofRs162 million. Transactions at short notice were ata peak of Rs600 million in September 2006 and ata trough of Rs15 million in August 2006.

Transactions at term on the interbank moneymarket accounted for a total amount of Rs13,085million. This represented a daily average amountof Rs131 million during 2006-07. Transactions atterm were at a peak of Rs290 million in Octoberand November 2006 and at a trough of Rs25 millionin September 2006.

Interbank interest rates fluctuated within arange of 3.50-12.75 per cent in 2006-07compared to a range of 1.40-10.00 per cent in2005-06, reflecting the increases in the LombardRate. Rates on the call money market fluctuatedbetween 3.50 per cent and 12.75 per cent in2006-07 compared to a range of 1.40-10.00 percent in 2005-06. The range of interest rates onmoney at short notice varied between 4.75 and12.50 per cent in 2006-07 compared to a range of

2.75-7.50 per cent in 2005-06 while the interestrate on transactions at term was in the range of6.00-12.50 per cent in 2006-07 compared to arange of 4.50-6.50 per cent in 2005-06.

The weighted average call money interest rateincreased by 439 basis points, from 3.53 per centin 2005-06 to 7.92 per cent in 2006-07 while theweighted average interest rate on transactions atshort notice increased by 483 basis points, from4.87 per cent in 2005-06 to 9.70 per cent in 2006-07. The weighted average interest rate ontransactions at term also went up by 433 basispoints, from 6.07 per cent in 2005-06 to 10.40per cent in 2006-07. Overall, the monthlyweighted average interbank interest rateincreased by 471 basis points, from 3.65 per centin 2005-06 to 8.36 per cent in 2006-07.

Tables 3.3 and 3.4 as well as Chart 3.3 givedetails on interbank transactions and interbankinterest rates in 2006-07.

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

Jul-

06

Aug

-06

Sep-

06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb-

07

Mar

-07

Apr

-07

May

-07

Jun-

07

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

11.00

Average Excess Daily Average Interbank Transactions

Weighted Average Interbank Interest Rate

Rs millionPer cent per

annum

Chart 3.3: Excess Liquidity, Interbank Transactions and WeightedAverage Interbank Interest Rate


91


2006

Jul 719 25 209 - - - - - - 719 25 209

Aug 1,295 190 421 356 15 107 95 70 72 1,651 205 493

Sep 730 15 329 600 50 255 95 25 60 1,075 40 470

Oct 900 25 442 450 112 296 290 290 290 1,290 450 802

Nov 715 65 409 125 40 66 290 290 290 1,005 197 586

Dec 595 10 238 - - - - - - 595 10 238

2007

Jan 888 90 400 100 50 86 - - - 918 100 434

Feb 680 80 278 50 50 50 90 90 90 730 114 312

Mar 944 1 232 200 24 106 - - - 1,094 26 284

Apr 730 18 221 100 100 100 - - - 730 18 227

May 895 30 355 200 200 200 - - - 1,095 30 368

Jun 430 25 185 110 60 80 90 50 69 520 35 252

2006-07 1,295 1 313 600 15 162 290 25 131 1,651 10 394

2005-06 1,125 6 296 300 40 110 60 30 38 1,175 6 296

Money at Call Money at Short Notice Money at Term Total Transactions

Peak Trough Daily Peak Trough Daily Peak Trough Daily Peak Trough DailyAverage Average Average Average

Table 3.3: Interbank Transactions(Rs million)

2006

Jul 3.65 3.50-5.00 - - - - 3.65 3.50-5.00

Aug 5.03 3.50-8.50 5.75 4.75-6.00 6.01 6.00 5.15 3.50-8.50

Sep 8.24 5.50-11.00 8.50 6.50-10.25 6.21 6.00-6.50 8.04 5.50-11.00

Oct 10.38 6.50-12.75 11.17 9.00-12.50 11.88 10.50-12.50 10.83 6.50-12.75

Nov 7.89 5.00-10.50 8.85 8.00-10.00 11.88 10.50-12.50 8.98 5.00-12.50

Dec 8.86 7.50-10.50 - - - - 8.86 7.50-10.50

2007

Jan 8.41 8.00-9.00 10.24 8.50-11.00 - - 8.55 8.00-11.00

Feb 8.70 8.00-9.00 8.75 8.75 12.00 12.00 9.04 8.00-12.00

Mar 8.18 8.00-8.50 8.72 8.00-9.00 - - 8.31 8.00-9.00

Apr 8.10 7.95-9.00 8.10 8.10 - - 8.10 7.95-9.00

May 8.37 8.00-9.00 8.60 8.60 - - 8.37 8.00-9.00

Jun 8.11 8.00-8.50 8.41 8.25-8.50 9.09 8.50-9.45 8.31 8.00-9.45

2006-07 7.92 3.50-12.75 9.70 4.75-12.50 10.40 6.00-12.50 8.36 3.50-12.75

2005-06 3.53 1.40-10.00 4.87 2.75-7.50 6.07 4.50-6.50 3.65 1.40-10.00

Money at Call Money at Short Notice Term Money Total Transactions

Weighted Range of Weighted Range of Weighted Range of Weighted Range ofAverage Interest Average Interest Average Interest Average InterestRate of Rates Rate of Rates Rate of Rates Rate of RatesInterest Interest Interest Interest

Table 3.4: Interbank Interest Rates(Per cent per annum)


92


Secondary Market Trading

Primary Dealer System

In its efforts to boost the development of thesecondary market for securities and to enhanceliquidity of the domestic market for thesesecurities, the Bank of Mauritius had established,effective 1 February 2002, a Primary DealerSystem for Mauritius. In June 2007, StandardBank (Mauritius) Ltd was granted primary dealerstatus, thus bringing the total number of primarydealers to six namely, Barclays Bank PLC, TheHongkong and Shanghai Banking CorporationLimited, The Mauritius Commercial Bank Ltd, StateBank of Mauritius Ltd, the Mauritius Post and

Cooperative Bank Ltd and Standard Bank(Mauritius) Ltd .

During the period under review, 1,335transactions for a total amount of Rs13,449 millionwere conducted by the primary dealers comparedto 899 transactions for a total value of Rs7,473million during 2005-06. Yields varied between 6.29per cent and 13.52 per cent during 2006-07compared to a range of 4.00-8.06 per cent in2005-06.

Table 3.5 gives details of transactionsconducted by primary dealers from July 2006 toJune 2007 while Table 3.6 shows purchases andsales effected over the same period.

1 2 to 30 44 488.8 6.55-12.80

2 31 to 60 34 368.8 6.29-13.10

3 61 to 90 315 3,879.2 6.73-13.00

4 91 to 135 34 595.1 6.90-13.15

5 136 to 180 219 3,424.5 7.05-13.05

6 181 to 240 24 349.4 7.20-13.26

7 241 to 300 29 103.3 7.55-13.00

8 301 to 364 636 4,239.8 7.52-13.52

9 365 to 485 - - -

10 486 to 606 - - -

11 607 to 728 - - -

2006-07 1,335 13,448.9 6.29-13.52

2005-06 899 7,472.7 4.00-8.06

Table 3.5: Primary Dealer Activities

Value(Rs million)

Yield(Per cent per annum)

Number of Transactions

Days toMaturity

Band

Note: With effect from 01 June 2007, the number of Primary Dealers has increased from five to six.


93


2006

Jul 7 130.9 40 444.9 47 575.8 6.29-7.98

Aug 1 1.0 25 227.7 26 228.7 6.70-7.97

Sep 9 79.6 75 773.9 84 853.5 7.02-10.25

Oct 9 68.3 84 767.3 93 835.6 9.51-10.60

Nov 18 989.0 49 1,091.8 58 1,222.1 9.76-11.05

Dec 6 99.1 147 1,414.6 153 1,513.7 7.81-12.90

2007

Jan 10 128.3 143 1,236.8 151 1,325.1 11.90-13.46

Feb 11 177.7 130 666.7 141 844.4 11.50-13.52

Mar 1 50.0 194 1,658.0 195 1,708.0 10.75-13.00

Apr 9 126.0 150 1,443.5 159 1,569.5 10.00-11.82

May 5 52.1 90 938.1 95 990.2 9.50-12.10

Jun 17 227.0 116 1,555.3 133 1,782.3 9.40-12.40

2006-2007 103 2,129.0 1,243 12,218.6 1,335 13,448.9 6.29-13.52

2005-2006 113 2,119.8 805 6,156.3 899 7,472.7 4.00-8.06

Volume Value Volume Value Volume Value(Rs million) (Rs million) (Rs million)

Purchases Sales Total Transactions 1

1 Figures do not add up to total purchases and sales as inter-primary dealer transactions, that is, purchases and sales of Treasury/BOM Bills among primary dealers, are accounted for only once.

Note: With effect from 01 June 2007, the number of Primary Dealers has increased from five to six.

Rangeof Yields

(Per cent perannum)

Table 3.6: Purchases and Sales of Treasury/Bank of Mauritius Bills by Primary Dealers 1

Secondary Market Cell

As part of its efforts to stimulate thedevelopment of the secondary market, the Bank ofMauritius carries out trading of GovernmentSecurities out of its own portfolio through itsSecondary Market Cell (SMC).

The Bank of Mauritius, in collaboration withthe SEM and the CDS, offers three types of Bills,namely 182-day, 364-day and 728-day Bills on theStock Exchange of Mauritius through licensedstockbroking companies. Trading is restricted toMauritian citizens only and for a total investment ofRs2 million per order.

Table 3.7 shows secondary market dealings inTreasury/Bank of Mauritius Bills while Table 3.8shows trading of Treasury/Bank of Mauritius Billson the Stock Exchange of Mauritius Ltd.

Special Line of Credit to the Sugar Industry

In 2001, the Bank of Mauritius with a view toenabling banks to support the restructuring of the

Sugar Industry in the context of the Sugar SectorStrategic Plan 2001-2005, had introduced a SpecialLine of Credit for the sugar sector for an initialamount of Rs1.5 billion, which was subsequentlyincreased to Rs2.0 billion in 2002, and thereafter toRs2.45 billion.

Initially, funds were made available to banksat an interest rate of 5.5 per cent per annum forthem to on-lend to the Sugar Industry at a rate notexceeding 7.5 per cent per annum. The amountsdisbursed by the Bank of Mauritius were repayablewithin 6 years after disbursement with amoratorium period of 2 1/2 years on the capitalfrom the date of its disbursement.

Effective 17 December 2004, the terms andconditions of the Special Line of Credit wereenhanced. The repayment period for loans alreadydisbursed was extended from 6 to 7 years and themoratorium period was also extended from 2 1/2 to3 years. For new loans disbursed after 17December 2004, the rate of interest was decreasedby 1 percentage point and funds were made


94


2006

Jul 575.8 705.8 706.8 5,400.0 5,401.0 0.0 7.62

Aug 228.7 113.7 170.1 2,918.4 2,974.8 0.0 7.09

Sep 853.5 188.2 134.9 3,398.1 3,344.8 0.0 7.72

Oct 835.6 196.8 303.2 3,107.3 3,213.7 0.0 -

Nov 1,222.1 295.1 191.7 2,201.8 2,098.4 0.0 -

Dec 1,513.7 35.0 312.2 6,381.5 6,658.7 0.0 -

2007

Jan 1,325.1 17,543.2 15,959.8 5,657.7 4,074.3 0.0 13.09

Feb 844.4 8,052.5 9,713.4 3,777.3 5,438.2 0.0 13.08

Mar 1,708.0 16,798.2 15,189.0 12,500.0 10,890.8 0.0 12.71

Apr 1,569.5 15,416.9 15,512.9 9,300.0 9,396.0 0.0 11.80

May 990.2 3,581.9 3,499.4 4,000.0 3,917.5 0.0 11.75

Jun 1,782.3 566.5 127.2 8,650.0 8,210.7 0.0 11.46

2006-07 13,448.9 63,493.8 61,820.6 67,292.1 65,618.9 0.0 12.42

2005-06 7,472.7 7,498.9 4,197.3 51,421.1 48,119.5 0.0 6.77

(Rs million) (Per cent perannum)

(1) (2) (3) (4) (5) (6) (7)

Amount Amount Amount Amount Net Amount Weighted of Bills of of of Bills Amount of of Other Average Yield

Transacted Bills Bills Accepted Bills Sold Government to BuyersOutside Purchased Sold by at Primary by Bank Securities on Bills SMC 1 by SMC SMC 2 Auctions of Mauritius Transacted Sold by

(3)+(4)-(2) SMC 3

Table 3.7: Dealings in Government Securities/Bank of Mauritius Bills

1 Include transactions by primary dealers2 Include Treasury Bills sold Over The Counter in Rodrigues and on the Stock Exchange of Mauritius Ltd.3 Only on Outright Transactions Over the Counter and on the Stock Exchange of Mauritius Ltd.

SMC: Secondary Market Cell of the Bank of Mauritius

available to banks at 4.5 per cent for on-lending at 6.5per cent to the Sugar sector. The repayment period onthese new loans was also extended to 7 years afterdisbursement and the moratorium period to 3 years onthe capital from the date of its disbursement. Paymentof interest on the loan facilities, however, remain thesame as in the initial conditions, that is, interestaccrues as from the date of disbursement and ispayable in arrears on a calendar quarterly basis.

During 2006-07, no disbursement was madeunder this facility. The total amount disbursed andoutstanding as at close of business on 30 June 2007under the Line of Credit stood at Rs2,093 million.

Equity Fund

To support the financing of the National EquityFund set up in July 2003, the Bank of Mauritius

made available to the Development Bank ofMauritius Ltd (DBM) a Special Line of Credit ofRs700 million to be drawn down within 2 years ofthe setting up of the Fund. Out of the Rs700million, an amount of Rs450 million was to beutilised by the DBM towards its own participation inthe Fund and the balance of Rs250 million was foron-lending by the DBM to the State InvestmentCorporation (SIC) for its participation in the EquityFund. There is a moratorium period of three yearson interest and capital repayments.

The drawdown period of 2 years expired on 9July 2005. However, in view of expected futuredrawdowns up to January 2007, the Bank ofMauritius had reactivated the Special Line of Creditfor the National Equity Fund in February 2006 foran amount of Rs90 million on the existing termsand conditions.


95


The interest rate applicable under the line ofcredit advanced by the Bank is set at 5.0percentage points below the then prevailingLombard Rate. Interest, which is payable in arrearsquarterly on a calendar year basis, starts accruingon the loan facilities as from the date of itsdisbursement and is capitalised during themoratorium period of three years.

The amounts disbursed by the Bank togetherwith interest capitalised during the moratoriumperiod are repayable in four equal annualinstalments, not later than seven years afterdisbursement.

Following the reactivation of the Special Lineof Credit in February 2006, an amount of Rs50million was disbursed, thereby bringing the totalamount disbursed to Rs122.5 million as atend-June 2007.

FOREIGN EXCHANGE MARKET

During 2006-07, liquidity on the domesticforeign exchange market remained tight up toOctober 2006 before it improved thereafter.

Banks registered shortfalls estimated ataround an equivalent of US$6.6 million on amonthly average basis in their net foreignexchange positions. The total net forward receiptsoutstanding as at end-June 2007 stood at anequivalent amount of US$71.1 million.

Chart 3.4 shows the monthly average foreignexchange liquidity position of banks andintervention by the Bank during 2006-07.

Interbank Foreign Exchange Market

During 2006-07, turnover on the interbankforeign exchange market increased to anequivalent amount of US$84.20 million comparedto an equivalent amount of US$62.37 million in2005-06. Out of this turnover, purchases of USdollars against the rupee amounted to US$45.72million compared to a lower amount of US$18.13million in 2005-06.

Intervention by the Bank of Mauritius during2006-07 reflected the foreign exchange liquiditycondition of the market. During the period July2006 to mid-February 2007, the Bank sold

2006

Jul - - - - -

Aug - - - - -

Sep - - 1.6 1.6 7.47

Oct - - - - -

Nov - - - - -

Dec - - - - -

2007

Jan - 0.5 - 0.5 13.09

Feb - 29.8 - 29.8 13.06-13.09

Mar - 55.5 - 55.5 11.84-13.06

Apr - 8.1 - 8.1 11.81-11.84

May - 10.7 - 10.7 11.75-11.78

Jun - 10.6 - 10.6 11.09-11.75

2006-07 0.0 115.2 1.6 116.8 7.47-13.09

2005-06 0.0 0.0 28.6 28.6 5.84-6.88

Table 3.8:Trading of Treasury/Bank of Mauritius Bills on The Stock Exchange of Mauritius

Amount Transacted Yield

182-Day 364-Day 728-Day Total (Per cent

(Rs million) per annum)


96


2006

Jul 0.44 4.05 0.51 5.00 155.75 30.9550-31.3000

Aug 1.01 2.20 0.37 3.58 115.01 31.3075-32.4450

Sep 1.93 2.31 9.81 14.05 456.78 32.4450-32.5200

Oct 0.40 0.75 0.40 1.55 49.98 32.5175-32.6000

Nov 0.56 1.94 0.95 3.45 112.75 32.6000-32.6525

Dec 0.50 1.61 0.41 2.52 83.33 32.6525-32.6651

2007

Jan 0.25 0.81 0.37 1.43 46.62 32.6675-32.7700

Feb 16.86 2.95 0.56 20.37 666.46 32.6175-32.7900

Mar 4.40 1.45 1.11 6.96 226.42 32.3100-32.6025

Apr 5.85 0.64 1.13 7.62 244.12 31.4875-32.2875

May 8.96 1.31 0.69 10.96 342.30 31.0650-31.3375

Jun 4.56 1.66 0.49 6.71 209.69 31.1850-31.2875

2006-07 45.72 21.68 16.80 84.20 2,709.21 30.9550-32.7900

2005-06 18.13 10.99 33.25 62.37 1,905.32 29.3100-30.9550

Table 3.9: Interbank Foreign Exchange Market

Purchase of US dollar against

Rupee

(US$ million)

Opening InterbankMin - MaxAsk Rate 1

(Rs/US$)

Purchase of US dollar against Other Currencies

(US$ million)

Purchase of Other Foreign

Currencies

(US$ million)

Total Purchases

RupeeEquivalent

(Rs million)

US dollarEquivalent

(US$ million)

1 With effect from 23 October 2000, the Rs/US$ ask rate is based on the average of daily wholesale Rs/US$ ask rate of four major banks.

2006

Jul 9.5 31.05-31.12 0.0 -

Aug 31.0 32.16 0.0 -

Sep 31.8 32.16 0.0 -

Oct 15.4 32.16 0.0 -

Nov 10.5 32.30 0.0 -

Dec 22.4 32.30-32.50 0.0 -

2007

Jan 38.0 32.80 0.0 -

Feb 10.8 32.75 64.0 32.75-33.00

Mar 0.0 - 75.3 32.35-32.75

Apr 0.0 - 113.5 31.90-32.35

May 0.0 - 0.0 -

Jun 0.0 - 0.0 -

2006-07 169.4 31.05-32.80 252.8 31.90-33.00

2005-06 108.7 28.93-30.95 0.0 -

Table 3.10: Intervention by the Bank of Mauritius on the Interbank Foreign Exchange Market

Purchase of US dollar(US$ million)

Range of Intervention(Rs/US$ Bid Rate)

Range of Intervention(Rs/US$ Ask Rate)

Sale of US dollar(US$ million)


97


US$169.4 million on the market. During thesecond half of the fiscal year, the foreignexchange liquidity position of the market showedsignificant improvement due to increased inflowson the back of higher interest rate differentialsand foreign direct investment. The Bankintervened and purchased US$252.8 millionduring this period. The range of intervention ratesfor the sale of US dollars to the market movedbetween Rs31.05 and Rs32.80 per US dollar andfor the purchase of US dollars, the rates were inthe range of Rs31.90-33.00.

Table 3.9 gives details of monthly transactionson the interbank foreign exchange market andTable 3.10 provides the amount and range ofintervention by the Bank of Mauritius duringperiod 2006-07.

Foreign Exchange Transactions byBanks

Banks report on a daily basis to the Bank ofMauritius transactions of US$30,000 and above ortheir equivalent in other foreign currencies. During2006-07, total transactions reported amounted toan equivalent of US$2,950.3 million, compared toUS$2,423.0 million in 2005-06, i.e. an increase ofUS$527.3 million. On a currency-wise basis, 52.8per cent of total transactions were carried out in USdollar, 29.6 per cent in euro, 9.6 per cent in Poundsterling, 4.1 per cent in South African rand, 1.2 percent in Japanese yen, 1.0 per cent in Australiandollar and 1.7 per cent in other foreign currencies.Total monthly transactions peaked at an equivalentof US$343.6 million in May 2007 and reached atrough equivalent to US$162.8 million in July 2006.

The Rs/US$ weighted average dealt ask ratesat which transactions of US$30,000 and abovewere effected moved in line with developments onthe international markets and the evolution offoreign exchange liquidity conditions in thedomestic market. Between July 2006 and June2007, the Rs/US$ weighted average dealt ask ratesfluctuated between a high of Rs34.927 and a low ofRs30.986. Against the euro, the weighted averagedealt ask rates varied between a trough ofRs39.467 in July 2006 and a peak of Rs46.586 inDecember 2006 while, against the Pound sterling,the weighted average dealt ask rates movedbetween Rs57.080 in July 2006 and Rs69.330 inDecember 2006.

0

25

50

75

100

125

150

175

200

225

Jul-

06

Aug

-06

Sep-

06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb-

07

Mar

-07

Apr

-07

May

-07

Jun-

07

PurchasesSales

Chart 3.5:Banks' Transactions above US$30,000: TotalPurchases and Sales

-120.0

-100.0

-80.0

-60.0

-40.0

-20.0

0.0

20.0

40.0

Jul-

06

Aug

-06

Sep-

06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb-

07

Mar

-07

Apr

-07

May

-07

Jun-

07Foreign Exchange Liquidity

Sale of US dollars

Purchase of US dollars

Chart 3.4: Monthly Average Liquidity and Intervention on theForeign Exchange Market

Chart 3.6: Banks' Transactions above US$30,000:Turnover byCurrency

Other1.7% USD

52.8%JPY1.2%

AUD1.0%

GBP9.6%

Euro29.6%

ZAR4.1%

BOM_AR pg 1-118_06/08 6/8/08 10:08 Page 97

98


Chart 3.7: Weighted Average Dealt Rates of the Rupee Against Major Currencies1

39.0

40.0

41.0

42.0

43.0

44.0

45.0

46.0

47.0

Jul-0

6

Aug

-06

Sep

-06

Oct

-06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb

-07

Mar

-07

Apr

-07

May

-07

Jun-

07

Rs/Euro

31.031.532.032.533.033.534.034.535.035.5

Jul-0

6

Aug

-06

Sep

-06

Oct

-06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb

-07

Mar

-07

Apr

-07

May

-07

Jun-

07

Rs/US dollar

55.056.057.058.059.060.061.062.063.064.065.066.067.068.069.070.0

Jul-0

6

Aug

-06

Sep

-06

Oct

-06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb

-07

Mar

-07

Apr

-07

May

-07

Jun-

07

Rs/Pound sterling

2006

Jul 31.532 40.579 59.216 31.283 40.058 57.960

Aug 32.684 42.210 62.960 32.149 41.582 61.320

Sep 32.594 42.290 61.918 32.704 42.200 62.191

Oct 33.500 43.176 63.389 33.056 42.381 62.133

Nov 34.012 45.537 66.088 33.988 44.216 64.556

Dec 34.528 45.939 67.850 34.617 46.058 67.145

2007

Jan 33.670 43.816 66.740 33.865 44.719 66.897

Feb 32.908 43.455 65.000 33.405 43.796 65.743

Mar 32.700 43.518 64.520 32.778 43.517 64.381

Apr 31.948 43.618 64.000 32.237 43.573 64.173

May 31.578 42.692 61.940 31.356 42.382 62.361

Jun 31.893 42.917 63.857 31.818 42.672 63.318

Rs/US$ Rs/EUR Rs/GBP Rs/USD Rs/EUR Rs/GBP

Table 3.11: Weighted Average Dealt Selling Rates of the Rupee 1

1 Calculated on spot transactions of USD30,000 and above, or equivalent, of banks.

(End of Period) (Period Average)

1 Daily basis

BOM_AR pg 1-118_06/08 6/8/08 10:08 Page 98

99


1. Amount of Bonds put on Tender (Rs mn) 500.0 500.0 500.0 500.0 500.0 500.0

2. Value of Bids Received (Rs mn) 660.2 774.3 1,255.4 1,877.8 1,567.2 1,457.6

3. Value of Bids Accepted (Rs mn) 500.0 500.0 500.0 500.0 500.0 500.0

4. Interest Rate (% p.a.) 8.90 11.50 12.90 12.85 10.95 11.25

5. Highest Yield Accepted (% p.a.) 9.25 12.00 13.40 12.85 11.25 11.25

6. Weighted Yield on Bids Accepted (% p.a.) 9.07 11.83 13.21 12.85 11.08 11.25

7. Weighted Price of Bids Accepted ( % ) 99.329 98.781 98.891 100.000 99.511 100.000

Auction held on

16-Aug-061

25-Oct-062

20-Dec-063

21-Feb-074

18-Apr-075

20-Jun-076

Table 3.12: Auctions of Five-Year Government of Mauritius Bonds

1 For Issue on 18 August 2006. 2 For Issue on 27 October 2006. 3 For Issue on 22 December 2006.4 For Issue on 23 February 2007. 5 For Issue on 20 April 2007. 6 For Issue on 22 June 2007.

1. Value of Bids Received (Rs mn) 250.2 184.5 239.6 558.4 262.8 335.1 1,894.7 674.9 789.5

2. Value of Bids Accepted (Rs mn) 193.2 184.5 227.1 508.4 262.8 228.8 787.0 280.3 327.9

3.Interest Rate (% p.a.) 9.10 9.50 9.75 11.75 12.00 12.25 11.25 11.50 11.75

4. Highest Yield Accepted (% p.a.) 12.00 12.65 13.01 13.00 13.75 14.00 12.80 13.30 13.50

5. Weighted Yield on Bids Accepted (% p.a.) 11.31 11.98 12.17 12.19 13.26 13.19 12.54 12.73 13.03

6. Weighted Price of Bids Accepted ( % ) 89.506 83.860 81.987 97.967 92.288 93.427 94.104 92.280 90.963

Auction held on

20 September 2006 1

22 November 2006 2

23 May 2007 2

Amount of Bonds put on Tender (Rs mn) Rs1,000 million Rs1,000 million Rs1,395.2 million

7Yr-Bonds 13Yr-Bonds 20Yr-Bonds 7Yr-Bonds 13Yr-Bonds 20Yr-Bonds 7Yr-Bonds 13Yr-Bonds 20Yr-Bonds

Table 3.13: Auctions of Government of Mauritius Bonds

1 Issue of 22 September 2006 : 2 Issue of 24 November 2006 :7 Yr-Bonds : 9.10% 7-Year Government of Mauritius Bonds due 22 Sep 2013 7 Yr-Bonds : 11.75% 7-Year Government of Mauritius Bonds due 24 Nov 201313 Yr-Bonds : 9.50% 13 -Year Government of Mauritius Bonds due 22 Sep 2019 13 Yr-Bonds : 12.00% 13 -Year Government of Mauritius Bonds due 24 Nov 201920 Yr-Bonds : 9.75% 20 -Year Government of Mauritius Bonds due 22 Sep 2026 20 Yr-Bonds : 12.25% 20 -Year Government of Mauritius Bonds due 24 Nov 2026

3 Issue of 25 May 2007 :7 Yr-Bonds : 11.25% 7-Year Government of Mauritius Bonds due 25 May 201413Yr-Bonds : 11.50% 13 -Year Government of Mauritius Bonds due 25 May 202020 Yr-Bonds : 11.75% 20 -Year Government of Mauritius Bonds due 25 M ay 2027

Charts 3.5 and 3.6 give details on transactionsabove US$30,000 effected by banks while Chart3.7 and Table 3.11 show the weighted averagedealt rates of the rupee against major currencies.

PUBLIC DEBT MANAGEMENT

With a view to lengthening the maturity profileof Government debt, the Bank of Mauritius, actingas agent of the Government, raised a total amountof Rs6,000 million through the issues ofGovernment of Mauritius Bonds in 2006-07.

Of that amount, a total of Rs3,000 million wasraised through Five-Year Government of MauritiusBonds and Rs3,000 million through longer-termBonds with maturities ranging between 7 and 20

years. In addition, Treasury Notes with maturities

of 2, 3 and 4 years continued to be issued during

2006-07 on a monthly basis starting July 2006.

Issue of Five-Year Government ofMauritius Bonds

The amount put on tender at each auction

was kept at Rs500 million and, as such, six

issues of Five-Year Government of Mauritius

Bonds were held in 2006-07 for a total amount

of Rs3,000 million.

Table 3.12 provides details of the six auctions

of Five-Year Government of Mauritius Bonds held in

2006-07.


100


2006

7-Jul 800.0 47.7 21.1 15.9 22.2 21.1 15.9 7.60 7.90 8.25 8.05 8.32 8.71

11-Aug 1,500.0 809.6 525.6 602.6 584.6 406.8 508.6 8.10 8.40 8.65 8.28 8.44 8.76

8-Sep 1,500.0 95.9 63.1 124.6 65.3 63.1 124.6 8.10 8.40 8.65 8.52 8.50 8.83

13-Oct 800.0 239.8 235.3 234.8 239.8 235.3 232.8 8.50 8.90 9.15 10.71 10.89 11.04

10-Nov 800.0 138.5 198.5 203.3 138.5 198.5 203.3 8.50 8.90 9.15 11.20 11.57 11.88

8-Dec 800.0 424.1 466.7 281.5 288.0 318.5 193.5 10.00 10.40 10.65 12.38 12.68 12.93

2007

12-Jan 1,500.0 345.8 463.4 820.8 318.2 426.5 755.3 10.00 10.40 10.65 13.41 13.64 13.85

9-Feb 1,000.0 723.9 511.3 1,303.8 285.1 201.4 513.5 11.50 11.90 12.15 13.40 13.74 13.83

23-Mar 1,500.0 1,113.3 1,466.2 1,631.4 396.6 522.3 581.1 11.25 11.65 11.90 11.67 11.97 11.98

6-Apr 1,500.0 563.9 1,346.7 1,060.5 284.7 679.9 535.4 11.00 11.40 11.65 9.88 10.62 11.72

11-May 1,200.0 642.8 465.8 878.2 388.3 281.3 530.4 10.15 10.55 10.75 12.24 12.05 12.25

8-Jun 1,200.0 1,289.2 1,125.3 2,371.2 323.2 282.2 594.6 10.15 10.55 10.75 11.47 11.38 11.90

2006-07 14,100.0 6,434.5 6,889.0 9,528.6 3,334.5 3,636.9 4,789.0 7.60-11.50 7.90-11.90 8.25-12.15 8.05-13.41 8.32-13.74 8.71-13.85

2005-06 11,600.0 6,137.9 3,547.5 5,532.0 3,568.6 2,469.1 3,569.7 7.25-7.60 7.50-7.90 7.80-8.25 7.24--8.04 7.47-8.30 7.96-8.69

Table 3.14: Auctions of Treasury Notes

Amount Weighted Yield put on Value of Bids Received Value of Bids Accepted Interest Rate on Bids Tender Accepted

2Y-TN 3Y-TN 4Y-TN 2Y-TN 3Y-TN 4Y-TN 2Y-TN 3Y-TN 4Y-TN 2Y-TN 3Y-TN 4Y-TN

(Rs million) (Per cent per annum)

Issue of Government of MauritiusBonds

Bonds with maturities of 7, 13 and 20 yearswere also issued in 2006-07 for a total nominalamount of Rs3,000 million, split in three auctionsheld on 20 September 2006, 22 November 2006and 23 May 2007.

Details of the auctions of Bonds are given inTable 3.13.

Issue of Treasury Notes

The Bank continued the issues of 2, 3 and 4-year Treasury Notes on a monthly basis startingJuly 2006.

Details of the auctions of Treasury Notesduring 2006-07 are given in Table 3.14.


101

Annual Report 2006-07 Accounting, Budgeting and Payment System

The Accounting, Budgeting and PaymentSystem Department is responsible for themaintenance and safekeeping of accountingrecords and for the preparation of financialstatements of the Bank. As such, it provides backoffice services to the Bank’s Financial MarketsDepartment, Administration Department andBanking and Currency Division.

As provider of back office services, theDepartment exercises separate levels of control.The Department also prepares and monitors thebudget of the Bank and maintains recordspertaining to transactions carried out by PrimaryDealers. The Department fulfils one of the keyfunctions of central banking in managing andexercising an oversight of the payment andsettlement systems.

Accounting

The Department maintains accounting recordspertaining to, inter alia, foreign exchange transactionsand open market operations for Government ofMauritius Securities and Bank of Mauritius Bills.

Foreign exchange transactions in respect ofdebt servicing, payments for consultancy servicesand contributions to international organisations arecarried out by the Bank on behalf of theGovernment. Foreign currency receipts ofGovernment are credited to their accountsmaintained at the Bank.

The Committee of Officials, comprisingrepresentatives from the Bank, the AccountantGeneral’s Office and the Government DebtManagement Unit, meets regularly to discuss issuesrelating to the cash flow and borrowingrequirements of Government. A sub-committeemeets on Wednesdays to decide on the weeklyborrowing requirements of Government.

The Department undertakes the processing oftransactions of Government with internationalfinancial organisations such as the International

Monetary Fund, International Bank forReconstruction and Development and InternationalDevelopment Association. Dealings with theseorganisations include currency valuationadjustments, use of rupees under the operationalbudget and maintenance of value.

Auctions of Government of Mauritius TreasuryBills/Bank of Mauritius Bills on the primary marketare conducted every Friday. Transactionspertaining to successful bids are recorded in bookentry form at the Bank, except in cases wherecertificates of holdings are issued on request.Furthermore, holders of Bills whose transactionsare kept in book entry form at the Bank areprovided with monthly statements.

The Department also records transactionsrelating to Treasury Notes, Five-Year Governmentof Mauritius Bonds and Government of MauritiusBonds/Mauritius Development Loan Stocks, whichare issued in accordance with the annual IssuancePlan. Treasury Notes are recorded in book entryform whereas certificates of holdings are issued forFive-Year Government of Mauritius Bonds andGovernment of Mauritius Bonds/MauritiusDevelopment Loan Stocks.

Section 31(1) of the Bank of Mauritius Act2004 requires the accounting of the Bank to becarried out in conformity with accounting principlesapplicable to central banks and best internationalpractices. The Bank therefore prepares its accountsin accordance with International FinancialReporting Standards in so far as they are practicallyapplicable to Central Banks. In keeping withinternational standards and with a view toenhancing transparency, the Bank publishesfinancial statements in a more elaborate format.The Bank’s balance sheet and income and cash flowstatements for the financial year ended 30 June2007 together with comprehensive notes arepresented in this report.

The Bank also prepares a monthly statementof assets and liabilities, which is published in the

4 Accounting, Budgetingand Payment System


102

Accounting, Budgeting and Payment System Annual Report 2006-07

Government Gazette and in its Monthly StatisticalBulletin. A copy of the assets and liabilities issubmitted to the Minister in accordance withsection 32(6) of the Bank of Mauritius Act 2004.The statement of monthly assets and liabilities canalso be viewed on the Bank’s website.

Profitability of the Bank

Section 11(1) of the Bank of Mauritius Act2004 states that the Board of Directors of the Bankof Mauritius ('the Bank') shall determine the netprofits of the Bank for each financial year, aftermeeting all current expenditure for that year andafter making such provisions as it thinks fit for badand doubtful debts, depreciation in assets,contributions to staff funds and superannuationfunds and other contingencies. The Bank’saccounts for the year ended 30 June 2006 wasapproved by the Board on 28 September 2006.

The Bank realised a profit of Rs1,763.3 millionfor the year ended June 2007 compared to Rs906.1million for the year ended June 2006. The higheramount of profit realised in 2006-07 arose mainlyfrom higher interest earned on foreign investmentsmanaged by the Bank and better performance ofits investment portfolio with the Bank forInternational Settlements.

Bank of Mauritius Bills

Bank of Mauritius Bills are issued by the Bankon the same terms and conditions as Governmentof Mauritius Treasury Bills. The cost of servicing ofBank of Mauritius Bills is accounted for as anexpense in the accounts of the Bank.

Bank of Mauritius Bills issued and outstandingare revalued at the end of each month and aremarked to market in line with the requirements ofInternational Financial Reporting Standards. Thenominal amount of Bank of Mauritius Billsoutstanding in the books of the Bank stood atRs6,003.7 million as at 30 June 2007 compared toRs4,286.1 million as at end-June 2006.

Repurchase Transactions

A repurchase (repo) transaction is considered tobe a short-term loan at a guaranteed rate of interest.In the books of the Bank of Mauritius, repurchasetransactions are treated as collateralised financingtransactions and are carried out at the amounts ofcash advanced or received plus accrued interest.

Securities received under repurchaseagreements and securities delivered underreverse repurchase agreements are notrecognised in the balance sheet of the Bank unlesscontrol of the contractual rights that comprisethese securities is relinquished.

Interest earned on repurchase agreementsand interest incurred on reverse repurchaseagreements are recognised as interest income andinterest expense, respectively, over the life ofeach agreement.

The volume of repurchase transactionsconducted by the Bank during the financial year2006-07 amounted to Rs5,375 million whereas thevolume of reverse repurchase transactions stood atRs55,292 million.

Budgeting

The Department is responsible for thepreparation of the budget of the Bank and forbudgetary control. The budget is prepared in linewith the policy to be pursued by the Managementof the Bank during the budget year and is gearedtowards continuously improving the efficiency ofthe various areas of operations of the Bank.

The budgeting process involves all thedepartments of the Bank and their inputs are usedto prepare the master budget of the Bank. Theseinputs are categorised under three items, namely,“Recurrent Expenditure-Personal Emoluments”,“Recurrent Expenditure-Other Charges” and“Capital Expenditure”. A zero-base budgetingapproach is recommended as far as possible.

The master budget is discussed withManagement and then presented to the AuditCommittee of the Bank before submission to theBoard of Directors for approval. The budget of theBank for the year 2007-08 was prepared in the lightof the restructuring process undertaken at the Bankas well as the move to the New HeadquartersBuilding. It was presented to the Audit Committeeon 12 June 2007 and approved by the Board on 13June 2007.

The financial performance of the Bank iscontinuously monitored against the budget. Budgetreports, which are prepared and submitted tomanagement regularly, act as an early warningsystem that triggers strategic decisions in a timelymanner. Material variances and trends arehighlighted with a view to taking corrective action


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as appropriate. An Annual Budget Reportcomparing the actual results with the budget isprepared after the end of each financial year andsubmitted to the Board of Directors of the Bank.The Budget report for the year 2005-06 wasdiscussed with the Audit Committee on 19September 2006 and then presented to the Boardon 28 September 2006.

The budget is also monitored on adepartmental basis. Reports on the budgetperformance of each Department are prepared andsubmitted to the Management of the Bank atregular intervals. The reports compare actual andbudgeted performance and also provide a basis forfeedforward control. Heads of Departments are alsoprovided with actual figures pertaining to theirrespective departments. These figures arecompared with departmental budgets andappropriate control actions are taken at the level ofeach department within the overall budgetarycontrol framework of the Bank.

PAYMENT SYSTEM

Mauritius Automated Clearing andSettlement System (MACSS)

The statutory task of setting up an electronicsystem for the settlement of payments rests withthe Bank of Mauritius as per section 48 of the Bankof Mauritius Act 2004. The Bank launched, inDecember 2000, a real time gross settlementsystem known as the Mauritius Automated Clearing

and Settlement System (MACSS). The MACSS isthe Systemically Important Payment System forMauritius and complies with the Core principles ofSystematically Important Payment Systems(CPSS) issued by the Bank for InternationalSettlements (BIS).

Transactions routed through the system havebeen on the increase over the years both in termsof volume and value. Compared to the FinancialYear 2005-06, the daily average number oftransactions increased in the Financial Year 2006-07 by 25 per cent, that is, from 379 to 474transactions, whereas the average value oftransactions increased by 80 per cent, fromRs2,257 million to Rs4,071 million during thesame period.

The MACSS is enhanced as and when requiredin order to derive maximum benefit from thesystem. The Automated Clearing Moduleincorporated in the system caters for the electronictransmission of settlement files for the Port LouisAutomated Clearing House (PLACH). The systemalso accommodates the electronic submission ofstatistical returns by banks as well as thecommunication of data for the Mauritius CreditInformation Bureau (MCIB).

The MACSS Terms and Conditions andParticipant Procedures are available on theBank’s website.

Table 4.1 provides details of transactionsrouted through the MACSS for the period July 2006to June 2007.


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Port Louis Automated Clearing House

Section 48(1) of the Bank of Mauritius Act2004 provides for the Bank to organise, inconjunction with banks, a clearing house tofacilitate the clearing of cheques and otherpayment and credit instruments and to issueinstructions concerning such instruments, theirprocessing, collection, payment and retention andthe functioning of other clearing houses that theBank may authorise.

Furthermore, section 48(6) of the Actempowers the Bank to issue instructions or to makeregulations for the smooth functioning of a clearinghouse and payments system.

In line with the above provisions of the law, theBank of Mauritius, in collaboration with otherparticipant banks, operates the Port Louis AutomatedClearing House (PLACH) on terms and conditions thathave been stipulated in a set of rules known as thePort Louis Automated Clearing House Rules, whichare available on the Bank’s website.

These Rules serve to provide, inter alia, thebasic understanding and agreement by and amongparticipating banks in the Clearing House, the

objectives and responsibilities of the Port LouisAutomated Clearing House (PLACH), the liabilitiesand responsibilities of the participating banks andthe relationship between the Bank of Mauritius andthe participating banks.

Following the enactment of the Banking Act2004, section 44A of the Bills of Exchange Act hasbeen amended to provide for the presentment ofcheques for payment by electronic means.Accordingly, a banker may present a cheque forpayment to the banker on whom it is drawn bynotifying him of its essential features by electronicmeans or by any other means as may be specifiedby the Bank of Mauritius instead of presenting thecheque itself.

The Bank of Mauritius, with the collaborationof banks and the Mauritius Bankers’ AssociationLtd, has embarked on a project of ChequeTruncation for Mauritius. With the coming intooperation of the Cheque Truncation System, whichis an online image-based clearing system, chequeimages and relative MICR data will be captured andtransmitted electronically to the AutomatedClearing House. This system will also entailsignificant changes to the PLACH Rules.

2006

Jul 8,449 45,797 21 402 2,181

Aug 9,188 58,410 21 438 2,781

Sep 9,031 87,413 21 430 4,163

Oct 9,971 79,308 21 475 3,777

Nov 9,691 82,813 21 462 3,944

Dec 10,637 97,758 20 532 4,888

2007

Jan 10,020 103,090 21 477 4,909

Feb 9,015 91,641 18 501 5,091

Mar 10,367 109,476 20 518 5,474

Apr 10,365 93,885 21 494 4,471

May 10,843 71,934 22 493 3,270

Jun 10,052 88,028 21 479 4,192

2006-07 117,629 1,009,553 248 474 4,071

2005-06 95,800 570,929 253 379 2,257

Daily AverageNumber of

TransactionsValue of

Transactions

(Rs million)

Number of Days Number of

TransactionsValue of

Transactions

(Rs million)

Table 4.1: Mauritius Automated Clearing and Settlement System (MACSS): Total Transactions


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Cheques in Mauritius are standardised and useMagnetic Ink Character Recognition (MICR)technology. The use of reader/sorter machinesenables the exchange of details on cheques amongparticipants and settlement is effectedelectronically via the MACSS. The Accounting,Budgeting and Payment System Department isresponsible for the supervision of settlements.

The accreditation for the printing and encodingof MICR cheques is granted by the Cheque StandardsCommittee, which is chaired by the AssistantDirector-Accounting, Budgeting and PaymentSystem. The Committee comprises representativesfrom banks, the Association of Printers of Mauritiusand the Mauritius Bankers Association.

As at 30 June 2007, the followingprinters/encoders of MICR cheques were accreditedby the Cheque Standards Committee:

(i) De La Rue Currency and Security Print.

(ii) Madras Security Printers.

(iii) Master’s Continuous Stationery Ltd.

(iv) Mauritius Stationery Manufacturers Ltd.

(v) Excel Secure Technologies Ltd.

Table 4.2 provides data on cheques clearedthrough the Port Louis Automated Clearing Houseas well as the Port Mathurin Clearing Housein Rodrigues.

2006

Jul 439,834 16,863,937 21 20,944 803,045

Aug 429,785 16,294,314 21 20,466 775,920

Sep 421,650 17,104,810 21 20,079 814,515

Oct 455,243 19,217,504 21 21,678 915,119

Nov 451,305 17,925,915 21 21,491 853,615

Dec 479,019 20,631,281 20 23,951 1,031,564

2007

Jan 437,741 17,539,887 21 20,845 835,233

Feb 367,348 16,776,704 18 20,408 932,039

Mar 426,744 16,885,412 20 21,337 844,271

Apr 431,502 17,141,597 21 20,548 816,267

May 457,204 18,282,014 22 20,782 831,001

Jun 427,464 18,099,615 21 20,355 861,886

2006-07 5,224,839 212,762,990 248 21,068 857,915

2005-06 5,300,400 193,477,220 253 20,950 764,732

Daily AverageNumber ofCheques

Amount

(Rs ‘000)

Number of Days Number of

ChequesAmount

(Rs ‘000)

Table 4.2: Cheque Clearances

Intrabank cheques are cheques that aredrawn by customers of a particular bank and arepresented over the counter at that bank. Thesecheques are not channelled through the Port LouisAutomated Clearing House. Table 4.3 providesdetails on cheques cleared over the counters ofbanks on the last working day of each month.

Payment Systems Oversight

In terms of Section 4(2)(b) of the Bank ofMauritius Act 2004, one of the objects of the Bankof Mauritius is to ensure the stability and soundnessof the financial system of Mauritius. One of themeans of achieving this objective is through theoversight of the payment systems.


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Payment systems are essential vehicles forthe implementation of monetary policy. Theoversight function aims at safeguarding thetransmission channel for monetary policy andmaintaining systemic stability in payment systems.The oversight function also has the responsibility ofensuring that the general organisation of paymentflows within the economy is efficient and safe sothat public confidence in payment systems ismaintained. The Bank of Mauritius has theresponsibility of promoting the safety and efficiencyof existing and planned systems, assessing themagainst objectives set and, where necessary,inducing change.

In Mauritius, payment streams compriselarge value payments, settlement of securitiesand low value payments. Large value paymentsand the settlement of securities are effectedthrough the MACSS. Low value payments areprocessed through the Port Louis AutomatedClearing House and settled through the MACSS.Settlement in respect of credit cards is also donethrough the MACSS.

The ongoing oversight function comprises thecollection of information from daily reports on themovement of liquidity among participants of theMACSS and data from other sources, the analysis ofthe information and the initiation of action asappropriate. The oversight function is conductedby the Accounting, Budgeting and Payment System

Department in close collaboration with the BankingSupervision and the Financial Markets Departmentsand the Banking and Currency Division.

Central Depository and SettlementSystem

The Bank of Mauritius administers the dailysettlement of funds in respect of transactionscarried out on The Stock Exchange of Mauritius Ltdby stockbrokers and custodian banks through theCentral Depository and Settlement System. During2006-07, settlements for a total amount ofRs2,909.3 million were effected through theMACSS. The settlement of secondary trading ofBills on The Stock Exchange of Mauritius Ltd, whichamounted to Rs104.9 million in 2006-07, ishowever excluded from this figure.

Abandoned Funds

Under section 59 of the Banking Act 2004,banks are required to transfer to the Bank ofMauritius deposits or monies lodged with them forany purpose that have been left untouched and notclaimed for 10 years or more and the customer hasnot responded within 6 months to a letter from thefinancial institution about the dormant deposit ormoney. These funds, once transferred to the Bankof Mauritius, do not carry interest and are onlyrefunded to the financial institution for repaymentto owners of the funds or their heirs or assigns onrightful claims being established to the satisfactionof the central bank.

Further, section 57(6) of the Act stipulatesthat where a customer’s deposit or money lodgedwith a financial institution for any purpose,becomes less than the minimum balancerequirement in force in a financial institution fromtime to time and it has been left untouched for aperiod of one year and the customer has notresponded within six months to a letter from thefinancial institution informing him of any servicefees or charges that may be applicable on thedeposit or money for having fallen below theminimum balance, the deposit or money shallwithout formality be handed over forthwith by thefinancial institution to the customer concerned inperson, failing which it shall be transferred to thecentral bank to be dealt with in the manner referredto in section 59.

Accordingly, transfers to the Bank in respectof abandoned funds amounted to Rs155.7 million,

2006

Jul 27,079 930,770

Aug 24,438 888,292

Sep 30,516 2,238,351

Oct 25,329 1,041,383

Nov 26,239 1,156,827

Dec 44,508 3,614,227

2007

Jan 28,065 1,130,486

Feb 25,600 971,030

Mar 30,560 1,850,068

Apr 32,447 980,735

May 25,027 1,081,260

Jun 35,133 1,800,212

Last working Number of Amount

day of Cheques (Rs' 000)

Table 4.3: Intra Bank Cheque Clearing Transactions


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USD 34,348.88, GBP6,949.53 and EUR68.10 as at30 June 2007.

Regional Payment and SettlementSystem (REPSS)

The COMESA Clearing House is presentlydeveloping a system to improve the flow andsettlement of cross-border payment transactionsamong financial institutions for the benefit, interalia, of importers and exporters in the variousmember countries. This system is called RegionalPayment and Settlement System (REPSS) and itsobjectives are to:

(i) increase competition among the banks inthe region,

(ii) improve financing services,

(iii) lower costs to complete paymentcommitments,

(iv) promote the expansion of trade amongmember countries, and

(v) improve final funds availability to theexporter.

As mandated by Governors on 20-21 October2006 in Madagascar, the report of the TechnicalEvaluation Committee was considered by COMESAContracts Committee in Djibouti in November 2006and its recommendations submitted to the Councilof Ministers. Council decided to award the contractfor the Procurement of Software and Hardware forREPSS to CMA Small Systems AB of Sweden (CMA).Council further decided that COMESA Secretariatenters into negotiations with CMA Small SystemsAB for the establishment of a mutually acceptablesolution in all aspects and to finalise a contract withthe vendor. COMESA Secretariat met with thevendor in December 2006 and finalised and signeda contract with CMA Small Systems AB. Theapplication development started in March 2007.

The pre-implementation and implementationphase of REPSS will involve the following:

• Setting up of bilateral counterpartyaggregate limits and individual netsettlement limit for which collateral willbe needed for securing daily settlementof end of day position at the clearinghouse. This could include Net Debit(Payer) and Net Credit (Receiver) limits(the limit of each Central Bank’s net credit

(or debit) position could be determinedbased on the average value of itscountry’s total annual trade withinCOMESA during the previous three years);

• Utilisation of Central Bank’s account withthe Federal Reserve Bank of New Yorkfor effecting payment, in case of being anet payer, to REPSS Settlement Accountor receiving USD from the REPSSSettlement Account in case of a netcredit balance;

• Defining of REPSS business parametersrelating to holiday files, collateral etc;

• Selection of 2 commercial banks for thepilot;

• Presentation of REPSS to the NationalWorking Group for ensuring fullunderstanding of the operations of thecross border payment system.

SADC Payment Systems Project

The main objective of the SADC PaymentSystems Project is to foster co-operation andcoordination between SADC central banks onpayment, clearing and settlement systems so as to:

(i) Develop and implement in each SADCmember state a safe and efficientdomestic payment system based onnationally accepted principles;

(ii) Define and implement a regional cross-border payments strategy;

(iii) Identify, measure, maximise andmanage payment systems risks;

(iv) Achieve convergence of payment,clearing and settlement features,policies, practices rules and proceduresacross SADC regions and

(v) Conduct an ongoing payment systemsoversight that is aimed at reducing andeliminating cross-border settlement riskand systemic financial shocks.

The SADC payment System Project-AnnualRegional Conference was held at Centurion LakeHotel in South Africa from 18 to 20 September2006. The main themes discussed at theconference were as follows:

• Report on the Project since its inception.


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• International Trends in SettlementSystems.

• Securities Market Development issues.

• FSAP experiences in developingcountries.

• Card payments in SADC.

• The way forward on Regional Issues.

A regional conference was held from 2 to 4April 2007 in Livingstone, Zambia. The mainthemes discussed at the conference were asfollows:

• Central bank’s involvement in retailpayments: Policy issues andimplications.

• Securities Settlement Systems in theSADC region.

• Development of Correspondent Bankingin the region.

• General principles for InternationalRemittances services.

• Remittances-International and SWIFTdevelopments.

• Challenges of RTGS Cost Recovery: TheSouth African model.

A Country Leaders’ meeting was also held on4 April 2007.

CURRENT DEVELOPMENTS

Cheque Truncation System

With a view to further modernise thepayment system in Mauritius, the Bank ofMauritius, with the collaboration of banks and theMauritius Bankers’ Association Ltd, has embarkedon a project of Cheque Truncation for Mauritius.The Cheque Truncation Project has been promptedby the need to improve the speed and efficiency ofclearing processes.

The Cheque Truncation System is an onlineimage-based clearing system, where chequeimages and MICR data are captured andtransmitted electronically to the AutomatedClearing House via a secure broadbandcommunications network. Through secure imaging

technology, cheque truncation lowers the risk offraud and levels both the settlement and liquidityrisk within the entire payment workflow. Thisprocess eliminates the actual cheque movementinvolved in clearing and hence reduces the delaysassociated with the movements of cheques.

A Steering Committee under theChairmanship of the Bank of Mauritius andcomprising representatives from the MauritiusBankers’ Association Ltd and eight banks, was setup in September 2006 to direct the project anddefine requirements.

In order to have a better insight into thesystem and to identify the various stages leading tothe implementation of the system, presentationswere made for the attention of the SteeringCommittee by a few service providers. Further, adelegation led by the First Deputy Governor andcomprising representatives from the Bank ofMauritius, banks and the Chief Executive Officer ofthe Mauritius Bankers Association Ltd, paid a studyvisit to Hong Kong and Singapore in May 2007.

After considering the different models for theimplementation of the Cheque Truncation Systemin Mauritius, a decision was reached on the modelto be adopted. The central bank will be hosting theapplication and archiving of cheque images. Thelegal impediments with respect to the retentionperiod of physical cheques and cheque images arebeing addressed.

BANKING AND CURRENCY DIVISION

The Banking and Currency Division is made upof the Banking Office, the Currency Office and theRodrigues Office. It is entrusted with theresponsibilities relating to the issue andmanagement of the domestic currency and themaintenance of accounts.

THE BANKING OFFICE

The Banking Office is responsible for providingbanking services and manages accounts on behalfof the Government, commercial banks,international financial institutions and staffmembers. It is also responsible for the sale ofindustrial gold to manufacturers of jewellery as wellas the sale of Dodo Gold coins and commemorativecoins to the public.


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Sale of Gold

The Bank of Mauritius imports and sells goldof high quality, that is, 24 carats 999.9 assay inbar forms of 1,000 grams, 500 grams and 100grams and in grain forms to industrialists andlicensed jewellers.

The selling prices of industrial gold, based onprevailing international gold market prices areposted daily in the Banking Hall of the Bank.

Sale of Dodo Gold Coins

Dodo Gold coins of 22 carats are issued bythe Bank of Mauritius in four denominations,namely, one ounce with a face value of Rs1,000,half an ounce with a face value of Rs500, quarterof an ounce with a face value of Rs250 and one-tenth of an ounce with a face value of Rs100. Thecoins are legal tender in Mauritius for the valuestated thereon.

The Dodo Gold coins are on sale at the Bankof Mauritius and banks licensed by the Bank ofMauritius. They are also marketed overseas by theRoyal Mint of the United Kingdom. The daily sellingprices of the coins, based on their gold content andon the international gold market prices, are postedin the Banking Hall of the Bank.

Sale of Commemorative Coins

The under mentioned commemorative coinsare also on sale at Bank of Mauritius to members ofthe public.

1. Tenth Anniversary of the Independenceof Mauritius

A silver commemorative coin of Rs25denomination was issued to mark the10th anniversary of the independence ofMauritius. The sale price of the coin isRs25.

2. 1997 Golden Wedding Collector CoinProgramme

A silver commemorative coin of Rs20denomination was issued in May 1998 inproof condition to mark the 50thwedding anniversary of Queen ElizabethII and Prince Philip. The sale price of thecoin in presentation case is the rupeeequivalent of GBP20.

3. 150th Anniversary of the MauritiusChamber of Commerce & Industry Silverand Gold Coins

A gold commemorative coin of Rs1,000denomination and a silver commemorativecoin of Rs10 denomination both in proofcondition were issued in January 2000 tomark the 150th anniversary of theMauritius Chamber of Commerce &Industry. The sale prices of the gold andsilver coins in presentation cases areRs6,750 and Rs650 respectively.

4. Centenary of the Arrival of MahatmaGandhi in Mauritius

A silver commemorative coin of Rs100denomination in proof condition wasissued in November 2001 to mark thecentenary of the arrival of MahatmaGandhi in Mauritius. The sale price ofthe coin in presentation case is Rs725.

THE CURRENCY OFFICE

The Currency Office discharges the Bank’sstatutory obligation to ensure that there is anadequate supply of banknotes and coins to meetthe demand of the public in Mauritius. Its keyareas of work include:

• Ensuring the availability and supply ofgood quality coins and banknotes tocommercial banks.

• Accepting the deposits of banknotes andcoins from commercial banks.

• Attending to the destruction of soiledbanknotes.

During the financial year 2006/2007,banknotes and coins deposited at and issued by theBank amounted to Rs13,818 million and Rs15,115million, respectively. From the deposits, anamount of Rs8,932 million in banknotes wereexamined, out of which an amount of Rs3,147million was found to be unfit for circulation and waswithdrawn for destruction. The Bank examinedabout 23 million banknotes from which 54 per centwere found to be fit for circulation.

BOM_AR pg 1-118_06/08 6/8/08 10:08 Page 109

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THE RODRIGUES OFFICE

The Bank’s office in Rodrigues offers centralbanking services and maintains accounts on behalfof Government, commercial banks and staffmembers. The office also conducts over-the-counter sales of Government of Mauritius TreasuryBills to individuals and non-financial corporations.

It has the task of ensuring the availability andsupply of coins and banknotes to meet thedemands of banks in Rodrigues. Consignment ofbanknotes and coins are therefore made regularlyto and from the Office in order to meet the needsof Rodrigues in cash and to maintain the goodquality of banknotes and coin in circulation.


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Annual Report 2006-07 Administration and Staff Matters

5 Administration and Staff Matters

The composition of the Board of Directors andthe Monetary Policy Committee and the SeniorManagement Officials of the Bank are given inAppendices II, III and IV, respectively. Theorganization Chart of the Bank is shown inAppendix V.

As at 30 June 2007, the number of staffworking at the Bank was 244.

Conference, Seminars and TrainingCourses

Overseas

Mrs R. Jutton-Gopy, Legal Officer, attended aworkshop on Draft Model Central Bank Bill for SADCCentral Banks, held in Pretoria, South Africa, from24 to 28 July 2006.

Mr R. Naggea, Senior Bank Officer, attended aSeminar on Assessing Loan Credit Quality, held inTunis, Tunisia, from 11 to 15 September 2006.

Mrs M.L.C. Bastien Sylva, Bank ExaminerGrade I, attended the “Séminaire Destiné auxCadres Supérieurs des Organismes de Contrôle desBanques dans les Pays en DéveloppementFrancophones”, held in Paris, France, from 11 to 22September 2006.

Mr A. Jhary, Administrative Officer,attended the SADC Annual Regional Conference,held in Pretoria, South Africa, from 18 to 20September 2006.

Mr H.O. Jankee, Director-Research, attendedthe 3rd Meeting of the COMESA Monetary andExchange Rate Policies Sub-Committee, held inLusaka, Zambia, on 25 and 26 September 2006.

Mr S. Proag, Manager-Property, attended atraining on Installation and Manipulation of theLenticular Dodo Picture in London, U.K., from 2 to6 October 2006.

Mr B.K. Ramlaul, Administrative Officer,attended the SADC Training and Development

Forum Meeting and the Conference on HumanResource Management, held in Manzini, Swaziland,on 4 and 5 October 2006.

Miss V. Morarjee, Senior Research Officer,attended the Conference on Promoting InclusiveFinancial Systems, held in Basel, Switzerland, on11 and 12 October 2006.

Mrs S.D. Ramanah, Senior Bank Examiner,attended the SADC Intermediate Training Course inBanking Supervision, held in Centurion, SouthAfrica, from 16 to 27 October 2006.

Mr B. Kwok Chung Yee, Senior BankExaminer, attended the Seminar on Asset LiabilityManagement for Insurance Companies and Bank,held in Basel, Switzerland, from 17 to 19October 2006.

Mr S. Ramnarainsing, Senior Accounts Officer,attended the Regional Seminar on Payment andSettlement System, held in Hyderabad, India, from18 to 20 October 2006.

Mr Y. Toynoo, Senior Bank Examiner,attended the Seminar for Senior Bank Supervisorsfrom Emerging Market Economies, held at theFederal Reserve Training Center in Washington DC,USA, from 16 to 27 October 2006.

Mr P. Nundlall, Senior Bank Examiner,attended the FSI Seminar on Core Principles as aRoad Map to Basel II Implementation, held inBasel, Switzerland, from 21 to 23 November 2006.

Mr N.C.J. Li Yun Fong, Assistant Director-IT,attended the:

(i) IT Governance – COBIT ImplementationTraining and Planning Workshop, held inPretoria, South Africa, from 22 to 24November 2006;

(ii) SADC Central Banks InformationTechnology Forum Annual Conference,held in Salima, Malawi, from 26 Februaryto 2 March 2007.


112

Administration and Staff Matters Annual Report 2006-07

Miss L. Appadoo, Administrative Officer,attended the conference on “Bribery andCorruption”, held in Nairobi, Kenya, on 27 and 28November 2006.

Mrs P.S. Hurree Gobin, Senior ResearchOfficer, attended the Econometric Modelling andForecasting Course, held at the Centre for CentralBanking Studies at the Bank of England, UK, from27 November to 8 December 2006.

Mr D. Rughoobur, Senior Bank Examiner,attended the FSI Seminar on Practical Techniquesto Implement Pillar 2, held in Basel, Switzerland,from 28 to 30 November 2006.

Mr D. Ghurburrun, Chief Bank Examiner, andMr Y. Madhub, Senior Bank Examiner, attended the4th IMF Roundtable for Offshore and OnshoreSupervisors and Standard Setters, held in CaymanIsland on 13 and 14 December 2006.

Mr J.N. Bissessur, Assistant Director-Research(Statistics), attended an international conferenceentitled Towards Implementation of SDMX, held inWashington DC, USA, from 9 to 11 January 2007.

Mr K. Ramnauth, Research Officer, attended acourse on Regional Monetary and FinancialIntegration, held in Pretoria, South Africa, from 22to 26 January 2007.

Mrs M. Ramdhan, Senior Bank Examiner,attended the FSI High Level Meeting on theImplementation of Basel II in Africa and OtherRegional Supervisory Priorities, held in Cape Town,South Africa, on 5 and 6 February 2007.

Mrs R.A. Bappoo-Huneewoth, Senior BankExaminer, attended the Standard Bank Africa BaselII Conference, held in Johannesburg, South Africa,from 20 to 23 February 2007.

Mrs V. Soyjaudah, Chief Bank Examiner,attended the HSBC Basel II Regulatory College,held in London on 22 and 23 February 2007.

Mr M.V. Punchoo, Assistant Director-Research, and Mrs P.S. Hurree Gobin, SeniorResearch Officer, attended the Balance ofPayments Module Workshop, held in Accra, Ghana,from 26 February to 2 March 2007.

Mrs N. Mihdidin, Research Officer, attendedthe IMF Course on Financial Programming andPolicies, held at Stellenbosh University, SouthAfrica, from 26 February to 9 March 2007.

Mr M. Kona Yerukunondu, Assistant Director-Legal, and Mr R. Sooben, Assistant Director-Research, attended the Workshop on Legal andInstitutional Framework for a Common SADCCentral Bank, held in Pretoria, South Africa, from13 to 15 March 2007.

Mrs N. Sajadah-Aujayeb, Legal Officer,attended the Financial Regulators Forum in IslamicFinance, held in Kuala Lumpur, Malaysia, from 26to 29 March 2007.

Mrs M.M.A. Heerah-Pampusa, AssistantDirector-Financial Markets Department, attendedthe Commonwealth Secretariat Regional Workshopon Domestic Debt Management, held in Singaporefrom 26 March to 3 April 2007.

Mr C. Ellapah, Research Officer, attended theJoint COMESA-IMF Seminar for Senior Officials onExchange Rates, Regimes and Computation Policyand Operational Considerations for DevelopingCountries, held in Lusaka, Zambia, on 27 and 28March 2007.

Mr J.K. Ramtohul, Assistant Director –Accounting, Budgeting and Payment Systems,attended the SADC Annual Regional Conference,held in Livingstone, Zambia, from 2 to 4 April 2007.

Mr R. Chinniah, Assistant Director –Supervision, attended the SADC Heads of BankSupervisors Workshop held in Windhoek, Namibia,from 2 to 4 April 2007.

Mrs N. Nabee, Senior Bank Examiner,attended the Malta-Commonwealth Third CountryProgramme, Banking and Finance in Small States,Issues and Policies, held in Valetta, Malta, from 2 to13 April 2007.

Mr D. Audit, Research Officer, attended theSeminar on International Trade-in-ServicesStatistics, held in Tunis, Tunisia, from 16 to 20 April2007.

Mr J.C.H. Chamary, Senior Bank Examiner,attended the Seminar on Bank Supervision UsingOff-Site Bank Examination Information, held inTunis, Tunisia, from 23 to 27 April 2007.

Miss R. Bhuckory, Manager – FinancialMarkets Department, attended the NationalTreasury/OECD/BESA Regional Workshop, held inJohannesburg, South Africa, from 24 to 26April 2007.


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Mr M. Kona Yerukunondu, Assistant Director –Legal, attended the Assessor’s Training to ConductAnti-Money Laundering and Combating theFinancing of Terrorism Workshop, held in Nairobi,Kenya, from 30 April to 4 May 2007.

Mr D. Thakoor, Senior Analyst Programmer,and Mr I.F. Beekun, Analyst Programmer, attendedthe HP Finance Industry Executive 2007Conference, held in Istambul, Turkey, from 6 to 9May 2007.

Mr N. Kowlessur, Senior Research Officer,attended the Special Data Dissemination StandardModule, held in Cape Town, South Africa, from 7 to9 May 2007.

Mr D.D. Belut, Acting Manager – Accounting,Budgeting and Payment System and Mr A.K.Dowlut, Senior Analyst Programmer, attended theSWIFT Regional Conference in Africa, held in Dakar,Senegal, from 21 May to 24 May 2007.

Mrs P. Lo Tiap Kwong, Research Officer,attended the “Cours de Statistiques Monétaires etFinancières”, held in Tunis, Tunisia, from 21 May to08 June 2007.

Mr H. Ramsurn, Senior Bank Officer –Supervision, attended the Risk Management andInternal Audit Course, held in New York, USA, from21 to 25 May 2007.

Mr J. Pandoo, Assistant Director – FinancialMarkets Department, attended the BIS ReserveManagement Workshop, held in Macao from 22 to25 May 2007.

Mr H.O. Jankee, Director-Research, attendedthe Workshop on the Role of the Central Bank inEconomic Transformation: Learning from theMauritian Experience, held in Nairobi, Kenya, on 29May 2007.

Mrs H. Nundoochan, Research Officer, and MrsV Ramful, Junior Dealer, attended the Programmein Treasury Management, Focus: Middle Office, heldin Mumbai, India, from 25 to 27 June 2007.

Miss M.M. Lauricourt, Senior Bank Examiner,attended the Anti-Money Laundering Course, heldin Pretoria, South Africa, on 27 and 28 June 2007.

Local

Mr S. Proag, Manager-Property, and Mrs R.Jutton-Gopy, Legal Officer, attended the 4thInternational Conference on Construction Law andAlternative Dispute Resolution, organised by KDS

Consulting at La Pirogue Resort, Flic en Flac, on 22and 23 November 2006.

Mr M.V. Punchoo, Assistant Director-Research, attended:

(i) the Economic Partnership AgreementWorkshop, organised by the Ministry ofForeign Affairs, International Trade andCooperation (International TradeDivision) and held at Hotel La Plantationon 29 November 2006;

(ii) a meeting of the Tourism StatisticsCommittee, held in the Conference Roomof the Central Statistics Office on 9March 2007;

(iii) a meeting on Performance of theEconomy, held in the Conference Roomof the Central Statistics Office on 20June 2007.

Mr M. Kona Yerukunondu, Assistant Director-Legal, was delegated as representative of the Bankto address the audience at the National Symposiumon Preventing Money Laundering organised by theIndependent Commission Against Corruption on theoccasion of the 3rd International Anti-CorruptionDay and held on 8 December 2006 at the RajivGandhi Science Centre, Bell Village.

Mrs V. Soyjaudah, Chief Bank Examiner, MrsN. Sajadah-Aujayeb, Legal Officer, and Mrs U.Chuttarsing-Soobarah, Senior Bank Examiner,attended the Conference for Women, organised bythe Independent Commission Against Corruption onthe occasion of the 3rd International Anti-Corruption Day and held on 5 December 2006 atthe Municipality of Quatre Bornes.

Mr A. Jhary, Administrative Officer, wasdelegated by the Bank to assist the CustomsDepartment of the Mauritius Revenue Authority inthe process of technical and financial evaluation forthe design/printing of Excise Stamps for tobaccoproducts on 17 January 2007.

Mr J. Pandoo, Assistant Director – FMD, andMr N. Kowlessur, Senior Research Officer, Mr B.Kwok Chung Yee and Mr Y. Rughoobur, Senior BankExaminers, attended a Presentation on CreditRating, organised by the Ministry of Finance andEconomic Development and held on 13 February2007 at the Harilall Vaghjee Hall.

Mr J.N. Bissessur, Assistant Director –Research(Statistics), and Mrs S. Hurrymun, Chief


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Bank Examiner, attended the Executive Seminarson Banking, held at the University of Mauritius on21 March 2007.

Mr S. Ramrutton, Senior Research Officer,attended the International Conference onCompetition Policy, Private Sector Development &Poverty Reduction in Africa organised by theMinistry of Industry, Small & Medium Enterprises,Commerce and Cooperatives and held at DomaineLes Pailles on 29 March 2007.

Mr J. Pandoo, Assistant Director – FMD,attended a meeting on Method of Payment of LandTransfer Tax and Fixed Registration Duty i.r.o. aDeed Witnessing the Transfer of a ResidentialProperty under the Integrated Resort Scheme,organised by the Ministry of Finance and EconomicDevelopment on 2 April 2007.

Mrs P.S. Hurree Gobin, Senior ResearchOfficer, attended the Workshop on Investment Mapby the International Trade Centre, organised by theBoard of Investment on 15 May 2007.

Mrs H.S. Sewraj-Gopal, Secretary, Mr M. KonaYerukunondu Assistant Director-Legal, Mr K.Ramnauth, Research Officer, Mr D. Doobree, Head-Banking and Currency Division, and Mr G. Beegoo,Research Officer, attended, respectively, on 6, 11,12, 13 and 14 June 2007, Workshops onGovernance-African Peer Review Mechanism,organised by the National Economic and SocialCouncil at the Swami Vivekananda Centre, Pailles.

Mr N.C.J. Li Yun Fong, Assistant Director -IT,attended the National ICT Strategic PlanWorkshop, organised by the National ComputerBoard at the Ébène Cyber Tower Conference Hallon 22 June 2007.

Seminars and Conferences

The Bank organized a full day conference onBasel II at Restaurant Clos St Louis, Domaine LesPailles on 23 and 24 May 2007.

The Bank hosted the 6th Meeting of Governorsof the Association of African Central Banks (AACB)Eastern Africa Sub-regional Committee from 7 to10 May 2007 at Maritim hotel, Balaclava.

Overseas Visitors

Dr Charles Augustine Abuka and Mrs MaryKatarikawe from the Central Bank of Uganda wereat the Bank, from 17 to 31 July 2006, on a trainingattachment on the conduct of monetary policy.

Mr Philip F. Bartholomew and Mr George R.Iden from the International Monetary Fund were atthe Bank from 9 to 20 October 2006 to review theBank’s Supervision Department, MonetaryOperations and the Monetary Policy conducted bythe Bank.

Mr Dato Ahmad Tajudin Bin Abdul Rahmanfrom the Islamic Development Bank of Saudi Arabiawas at the Bank from 24 March to 21 April 2007 toassist the Bank’s Steering Committee on IslamicFinancial Services.

Ms Karen Gan and Mr A. Kanagalingam were atthe Bank from 12 to 19 May 2007 in the context ofthe organizational restructuring of the Bank.

Human Resource Matters

Appointments

Mr Yandraduth Googoolye, Director –Accounting, Budgeting and Payment System, wasappointed First Deputy Governor of the Bank witheffect from 13 July 2006.

Mrs Bhanoomatee Hardowar and MrsGuianooradha Seeballuck, Confidential Secretaries,were appointed Senior Confidential Secretary witheffect from 4 October 2006.

Mrs Saloni Kumari Boodhoo, Mrs Daya DeviNunkoo, Mrs Bibi Farozia Jhumka and MrsDoorgeshwaree Sooroojebally, Bank Officers GradeIII, were appointed Confidential Secretary witheffect from 4 October 2006.

Mr Asdeho Seeburn, Documentation Officer,Mrs Tilotma Gobin-Jhurry and Mr PrithvirajSeeballuck, Bank Officers Grade I, were appointedSenior Bank Officer with effect from 17 October2006.

Mr Roshan Kumar Gopaul, Mrs LiladeviGeesawor, Mrs Rajwantee Lulith, Mrs BindoomateeGungaram, Mrs Marie Dany Monique Arlandoo-Ramsamy and Mrs Amrita Devi Ramburun, BankOfficers Grade II, were appointed Bank OfficerGrade I with effect from 1 November 2006.

Mr Rundheersing Bheenick was appointedGovernor of the Bank with effect from 14 February2007.

Dr Ahmad Jameel Khadaroo was appointedSecond Deputy Governor of the Bank with effectfrom 14 February 2007.

Mr Yousouf Rajabalee, Acting Manager,Banking & Currency Division, and Mrs Bhagiawatee


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Yerrigadoo, Assistant Manager, Financial MarketsDepartment were appointed Manager with effectfrom 2 April 2007.

Recruitment

Mr Noel Emmanuel Heerah was appointedSecurity Manager with effect from 1 December 2006.

Retirement

Mr Soomun Daulchand, Bank Attendant GradeII, retired from the service of the Bank with effectfrom 12 July 2006.

Mr Hasham Aboo Bakar Emritte, AssistantSecretary, retired from the service of the Bank witheffect from 22 July 2006.

Mr Baboo Rajendranathsingh Gujadhur, FirstDeputy Governor of the Bank, retired from the serviceof the Bank with effect from 7 December 2006.

Mrs Maheshwaree Gujadhur, AdministrativeOfficer, retired from the service of the Bank witheffect from 9 January 2007.

Mr Chund Prakash Beeharee, Bank AttendantGrade III, retired from the service of the Bank witheffect from 11 January 2007.

Mr Vijay Kumar Sonah, Head-Banking &Currency Division, retired from the service of theBank with effect from 16 March 2007.

Mr Soobas Chadee, Manager-Banking &Currency Division, retired from the service of theBank with effect from 27 May 2007.

Resignation

Mr Neerunjun Ramtohul, Senior BankExaminer, and Miss Pratima Devi Ramful, ResearchOfficer, resigned from the service of the Bank witheffect from 1 October 2006.

Mr Vikass Ramessur, Research Officer,resigned from the service of the Bank with effectfrom 19 December 2006.

Mrs Urvashi Chuttarsingh-Soobarah, SeniorBank Examiner, resigned from the service of theBank with effect from 7 January 2007.

Miss Shivanee Appiah and Mr YougeshsinghToynoo, Senior Bank Examiners, resigned from theservice of the Bank with effect from 31 January 2007.

Mr Youvraj Madhub, Senior Bank Examiner,resigned from the service of the Bank with effectfrom 1 May 2007.

Miss Ratna Devi Nundloll, AnalystProgrammer, resigned from the service of the Bankwith effect from 28 May 2007.

Mr Jean Max Jacques Daniel Bonnafaire,Senior Accounts Officer, resigned from the serviceof the Bank with effect from 14 June 2007.

Mr Krishnaveni Uppiah, Senior BankExaminer, resigned from the service of the Bankwith effect from 18 June 2007.

Expiry of contract of employment

The contract of Mr Rameswurlall Basant Roi,G.C.S.K. as Governor of the Bank expired on 31December 2006.

Completion of studies

Mrs Pow Keem Lo Tiap Kwong, ResearchOfficer, was awarded the Master of BusinessAdministration with specialization in Finance by theUniversity of Technology, Mauritius in October 2006

Mrs Hemlata Nundoochan, ResearchOfficer, was awarded the degree of MScFinancial Economics by University of London inDecember 2006.

Mr Beemalsingh Jawaheer, Internal Auditor,was awarded the Master of Business Administrationby the University of Technology, Mauritius inFebruary 2007.

Miss Prithee Nishi Gopy, Senior AccountsOfficer was awarded the Master of BusinessAdministration by the Heriot-Watt University inJune 2006.

Mr Harryram Ramsurn, Senior Bank Officer,was awarded the Master of Business Administrationby Management College of South Africa inSeptember 2006.

Mr Prithiviraj Seeballuck, Senior Bank Officer,was awarded the Master of Business Administrationby the University of Technology, Mauritius inDecember 2006.

Mrs Pratima Keerodhur, Bank Examiner GradeI, was awarded the degree of BSc in Business


116


Administration by the Cyprus Institute of Marketingin March 2007.

Mrs Perly Grace Deanna Veerapatren, BankOfficer Grade I, was awarded the Master ofBusiness Administration by the ManagementCollege of Southern Africa in December 2006.

Mrs Rafika Parveen Bakar Khan, Bank OfficerGrade I, was awarded the degree of BSc(Hons) inBusiness Studies by the University of Mauritius inJune 2006.

Mr Pran Eswur Padaruth, Bank Officer GradeI, was awarded the degree of BSc(Hons) inBusiness Studies by the University of Mauritius inFebruary 2006.

Mrs Usha Pratap Gaya, Research Assistant,has completed her Bachelor in Commerce (Bcom)with the Indira Gandhi National University (IGNOU)New Delhi in December 2006.

Mrs Ouma Purmessur Dookhit, Bank OfficerGrade III, was awarded the degree of BSc (Hons)in Business Studies by the University of Mauritius inJune 2006.


117

Annual Report 2006-07 Audit Committee Report

6 Audit Committee Report

Report of the Audit Committee to theBank of Mauritius

The Audit Committee (Committee) which wasreconstituted by the Bank on 12 January 2006,consists of three non-executive Directors of theBoard namely, Mr S. R. Seebun (Chairman), Mr M.Ramphul and Mr J. G. A. Lascie. Mrs H. S. Gopal,Secretary of the Bank acts as Secretary to theCommittee, while the Manager-Internal AuditSection is in attendance at all meetings of theCommittee. The external auditors have beenpresent as and when required.

The Committee proposed that there be arotation of chairmanship and Mr J. G. A. Lascie wasnominated to act as Chairman with effect from 1July 2007. The Board thereafter ratified theproposal of the Committee.

Activities of the Committee

The Committee met on seven occasionsduring the year under review and undertook thefollowing:

(i) review of the audit reports submitted bythe Internal Audit Section of the Bank.Recommendations were made by the

Committee to management followingthese reports. The Internal Audit Sectionthen ensured a follow-up of therecommendations.

(ii) approval of an Internal Audit Charter toact as a guideline to the Internal AuditSection. Following the approval by theCommittee, the Internal Audit Charterwas recommended to the Board.

(iii) review of the estimated profit of theBank for the year ended 30 June 2007. Arecommendation was then made to theBoard for the relevant allocations andtransfers.

(iv) review of the Budget Report for thefinancial year 2005/2006 where actualfigures were compared with thebudgeted figures for the year ended 30June 2006. Explanations were sought formaterial variances.

(v) review of the financial statements for theyear ended 30 June 2006 andrecommendation to the Board thatapproval be given for the accounts tobe signed.

(sd) (S. R. Seebun) (sd) (M. Ramphul) (sd) (J. G. A. Lascie)Member Chairman Member


aaaa


Annual Report 2006-07 Financial Statements

119

BANK OF MAURITIUSFINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2007

Contents Page

Introduction 120

Report of the Auditor 121

Balance Sheet 123

Income Statement 124

Statement of Changes in Equity 125

Cash Flow Statement 126

Notes to the Financial Statements 127 - 148

7 Financial Statements

120

Financial Statements Annual Report 2006-07

INTRODUCTION

Section 11(1) of the Bank of Mauritius Act 2004 states that the Board of Directors of the Bank of Mauritius('the Bank') shall determine the net profits of the Bank for each financial year, after meeting all currentexpenditure for that year and after making such provisions as it thinks fit for bad and doubtful debts,depreciation in assets, contributions to staff funds and superannuation funds and other contingencies.

The Bank realised a profit of Rs1,763.3 million for the year ended 30 June 2007 compared toRs906.1 million in 2006.

Assets

The Bank’s foreign assets have increased as a result of an increase in Cash and Cash Equivalents.

Local assets have decreased mainly due to a decline in Financial Assets Available for Sale and Loans andAdvances partly offset by an increase in Property, Plant and Equipment.

Liabilities

Liabilities have increased mainly due to an increase in the net amount of Bank of Mauritius Bills issued andincrease in Notes and Coins in Circulation.

Capital and Reserves

The net increase in Reserves arises mainly from net appreciation of Foreign Assets which has beentransferred to the Special Reserve Fund together with the increase in the General Reserve Fund allocatedfrom net profits.

Statement of Responsibilities of the Board of Directors of the Bank of Mauritius

Section 31(2) of the Bank of Mauritius Act 2004 requires the accounts of the Bank to be audited at least oncea year by such auditors as may be appointed by the Board.

The Board of Directors of the Bank is responsible for the preparation of financial statements which give a trueand fair view of the financial position, financial performance and cash flows of the Bank in conformity withaccounting principles applicable to Central Banks and best international practices in accordance with Section31(1) of the Bank of Mauritius Act 2004. The Bank's policy is to prepare financial statements in accordance withInternational Financial Reporting Standards. The Board is also responsible for safeguarding the assets of theBank and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The general policy of the affairs and business of the Bank are entrusted to a Board of Directors. As at 30 June2007, the Board consisted of the Governor as Chairperson, two Deputy Governors and six Non-ExecutiveDirectors. The Bank of Mauritius Act 2004 provides for not less than five but not more than seven otherDirectors. The Governor and Deputy Governors are appointed by the President of the Republic of Mauritiuson the recommendation of the Prime Minister for a period not exceeding five years and on such terms andconditions as may be specified in the instrument of appointment. The Governor is the principalrepresentative of the Bank and is responsible for the execution of the policy of the Board and the generalsupervision of the Bank of Mauritius. The Deputy Governors are under the general supervision of theGovernor and responsible for the day-to-day administration of the Bank. The Non-Executive Directors of theBank hold office for a term not exceeding three years and are appointed by the Minister of Finance. Thedirectors are eligible for reappointment at the end of their term of office. The Board meets at the seat of theBank and six members constitute the quorum.


121

INDEPENDENT AUDITORS' REPORT TO THE SHAREHOLDER OFBANK OF MAURITIUS

This report is made solely to the shareholder of the Bank, as a body. Our audit work has been undertakenso that we might state to the shareholder of the Bank those matters we are required to state to them in anauditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept orassume responsibility to anyone other than the Bank and the shareholder of the Bank as a body, for our auditwork, for this report, or for the opinion we have formed.

Report on the Financial Statements

We have audited the financial statements of Bank of Mauritius on pages 119 to 156 which comprise thebalance sheet as at 30 June 2007 and the income statement, statement of changes in equity and cashflow statement for the year then ended and a summary of significant accounting policies and otherexplanatory notes.

Board of Directors’ responsibilities for the financial statements

The Board of Directors of the Bank is responsible for the preparation of these financial statements inconformity with accounting principles applicable to central banks and best international practices inaccordance with Section 31(1) of the Bank of Mauritius Act 2004. This responsibility includes: designing,implementing and maintaining internal control relevant to the preparation and fair presentation of financialstatements; selecting and applying appropriate accounting policies; and making accounting estimates thatare reasonable in the circumstances.

Auditor’s responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conductedour audit in accordance with International Standards on Auditing. Those standards require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assurance whether thefinancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in thefinancial statements. The procedures selected depend on the auditor’s judgment, including the assessmentof the risks of material misstatement of the financial statements, whether due to fraud or error. In makingthose risk assessments, the auditor considers internal control relevant to the entity’s preparation and fairpresentation of the financial statements in order to design audit procedures that are appropriate in thecircumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internalcontrol. An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of accounting estimates made by management, as well as evaluating the overallpresentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for ouraudit opinion.

Opinion

In our opinion, the financial statements on pages 119 to 156 give a true and fair view of the financial positionof the Bank as at 30 June 2007, and of its financial performance and cash flows for the year then ended inaccordance with International Financial Reporting Standards and comply with the requirements of the Bankof Mauritius Act 2004.

122


INDEPENDENT AUDITORS' REPORT TO THE SHAREHOLDER OFBANK OF MAURITIUS (CONT’D)

Report on other legal requirements

In accordance with the requirements of the Bank of Mauritius Act 2004, we report as follows:

• we have no relationship with, or interests in, the Bank, other than in our capacity as auditors; • the net profit for the year has been ascertained in accordance with Section 11 of the Bank of Mauritius

Act 2004; and• in our opinion, proper accounting records have been kept by the Bank as far as it appears from our

examination of those records.

Kemp Chatteris DeloitteChartered Accountants29 October 2007

BANK OF MAURITIUS BALANCE SHEET AT 30 JUNE 2007

Note 2007 2006Rs Rs

ASSETSForeign Assets:

Cash and Cash Equivalents 6 27,596,057,717 12,946,294,561Other Balances and Placements 7 24,746,676,433 29,105,342,783Interest Receivable 421,651,880 388,225,449Other Investments 19,209,941 18,742,743

52,783,595,971 42,458,605,536Loans and Advances 8 1,426,843,474 1,817,119,262Financial Assets Available-For-Sale 9 619,852,226 3,856,115,144Computer Software 10 164,769 724,886Property, Plant and Equipment 11 1,953,457,013 1,473,041,621Other Assets 12 561,800,057 381,525,777

TOTAL ASSETS 57,345,713,510 49,987,132,226

LIABILITIESNotes in Circulation 13 13,131,807,775 11,892,736,355Coins in Circulation 13 459,313,393 434,778,427

13,591,121,168 12,327,514,782

Demand Deposits:Government 1,174,031,812 2,278,507,262Banks 9,480,130,610 9,047,459,221Other Financial Institutions 90,784,112 225,902,470Others 953,101,952 411,436,649

11,698,048,486 11,963,305,602

Other Financial Liabilities 14 5,970,871,779 4,250,181,872Provision 15 100,000,000 100,000,000Employee Benefit Obligations 16 51,080,000 34,720,000Other Liabilities 17 1,368,342,925 1,099,190,648

TOTAL LIABILITIES 32,779,464,358 29,774,912,904

CAPITAL AND RESERVES 5Stated Capital 1,000,000,000 1,000,000,000Reserves 23,566,249,152 19,212,219,322

TOTAL CAPITAL AND RESERVES 24,566,249,152 20,212,219,322

TOTAL LIABILITIES AND CAPITAL 57,345,713,510 49,987,132,226

Approved and authorised for issue on: 29 October 2007

J.K. Ramtohul Dr A. J. Khadaroo R. BheenickHead-Accounting and Budgeting Second Deputy Governor Governor


123

BANK OF MAURITIUSINCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2007

Note 2007 2006Rs Rs

IncomeIncome from Financial Assets

Interest and Similar Income on Foreign Assets 18 2,107,386,403 1,245,742,525Interest and Similar Income on Local Assets 18 155,404,665 126,317,521Others 18 235,069,911 194,597,000

18 2,497,860,979 1,566,657,046Loss on Foreign Exchange Transactions (63,967,010) (10,314,556)Other Income 19 21,290,553 8,696,718

2,455,184,522 1,565,039,208

EXPENDITUREExpenditure on Financial Liabilities:- Interest Expense and Similar Charges 20 340,860,274 349,016,616Staff Salaries and Other Benefits 21 155,968,889 139,596,160General Expenditure 88,338,067 51,364,681Fees Payable 13,050,966 20,361,006Coin Issue Expenses 6,536,908 24,304,731Note Issue Expenses 14,342,155 24,243,090Depreciation of Property, Plant and Equipment 20,880,551 21,787,069Directors' Remuneration 22 11,760,600 6,464,919IMF Charges 29 22,013,700 5,879,190Other Expenditure 23 18,096,486 15,883,549

691,848,596 658,901,011

NET PROFIT FOR THE YEAR IN TERMS OFSECTION 11 OF THE BANK OF MAURITIUSACT 2004 1,763,335,926 906,138,197

Net Foreign Exchange Gains and Gains on Revaluation ofGold and SDR 3,490,693,904 2,252,588,925

NET PROFIT FOR THE YEAR IN TERMS OF IFRS 5,254,029,830 3,158,727,122

Less: Transfer to Special Reserve Fund (3,490,693,904) (2,252,588,925)Less: Transfer to General Reserve Fund (303,512,047) (306,138,197)Less: Transfer to Open Market Operations (559,823,879) -

PROFIT AVAILABLE TO THE GOVERNMENT OFMAURITIUS FOR TRANSFER TO CONSOLIDATEDFUND 900,000,000 600,000,000

124



125

BANK OF MAURITIUSSTATEMENT OF CHANGES IN EQUITYFOR THE YEAR ENDED 30 JUNE 2007

Stated General Special and Paid Reserve Reserve Accumulated Other

Up Capital Fund Fund Profit Reserves Total

Rs Rs Rs Rs Rs Rs

At 1 July 2005 1,000,000,000 390,349,756 14,580,856,198 - 1,682,286,246 17,653,492,200Net Profit for the Year in terms of IFRS - - - 3,158,727,122 - 3,158,727,122Transfer to Special Reserve Fund - - 2,252,588,925 (2,252,588,925) - -Transfer to General Reserve Fund - 306,138,197 - (306,138,197) - -Profit available to the Government of

Mauritius for transfer to ConsolidatedFund - - - (600,000,000) - (600,000,000)

At 30 June 2006 1,000,000,000 696,487,953 16,833,445,123 - 1,682,286,246 20,212,219,322

At 1 July 2006 1,000,000,000 696,487,953 16,833,445,123 - 1,682,286,246 20,212,219,322Net Profit for the Year in terms of IFRS - - - 5,254,029,830 - 5,254,029,830Transfer to Special Reserve Fund - - 3,490,693,904 (3,490,693,904) - -Transfer to Other Reserves - - - (559,823,879) 559,823,879 -Transfer to General Reserve Fund - 303,512,047 - (303,512,047) - -Profit available to the Government of

Mauritius for transfer toConsolidated Fund - - - (900,000,000) - (900,000,000)

At 30 June 2007 1,000,000,000 1,000,000,000 20,324,139,027 - 2,242,110,125 24,566,249,152

BANK OF MAURITIUSCASH FLOW STATEMENTFOR THE YEAR ENDED 30 JUNE 2007

Notes 2007 2006Rs Rs

CASH FLOWS FROM OPERATING ACTIVITIES

Net Cash Inflow from Operating Activities 24 8,456,472,809 1,488,300,353

CASH FLOWS FROM INVESTING ACTIVITIES

Decrease in Other Balances and Placements 4,358,666,350 5,177,351,861Decrease/(Increase) in Financial Assets

Available-For-Sale 3,236,262,918 (728,940,198)Additions to Intangible Assets (139,598 (195,557)Acquisition of Property, Plant and Equipment (504,187,997) (682,579,023)Proceeds from Sale of Property, Plant

and Equipment 2,157,820 680,500Proceeds from Sale of Intangible Asset 100 -Proceeds from Sale of Shares in Les Pailles InternationalConference Centre Ltd - 200,000,000Dividend Received 530,754 628,792

Net Cash Generated from Investing Activities 7,093,290,347 3,966,946,375

Cash Flows from Financing Activities

Profit payable/paid to the Government of Mauritius (900,000,000) (600,000,000)

Net Increase in Cash and Cash Equivalents 14,649,763,156 4,855,246,728

Cash and Cash Equivalents at 1 July 6 12,946,294,561 8,091,047,833

Cash and Cash Equivalents at 30 June 6 27,596,057,717 12,946,294,561

126



127

BANK OF MAURITIUSNOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2007

1. LEGAL FRAMEWORK

In terms of section 4(2)(c) of the Bank of Mauritius Act 2004, the Bank of Mauritius (‘the Bank’) has

been established to act as the Central Bank for Mauritius. Its main place of business is at Sir William

Newton Street, Port Louis, and it operates an office in Rodrigues. The Bank is an independent

institution with its own legal personality and tables its reports annually to the National Assembly.

The Bank’s principal responsibilities are to:

• conduct monetary policy and manage the exchange rate of the rupee, taking into account the

orderly and balanced economic development of Mauritius;

• regulate and supervise financial institutions carrying on activities in, or from within, Mauritius;

• manage, in collaboration with other relevant supervisory and regulatory bodies, the clearing,

payment and settlement systems of Mauritius;

• collect, compile, disseminate, on a timely basis, monetary and related financial statistics; and

• manage the foreign exchange reserves of Mauritius.

Under Section 10 of the Bank of Mauritius Act 2004, the stated and paid up capital of the Bank shall be

not less than one billion rupees and shall be subscribed and held solely by the Government. Further,

the amount paid as capital of the Bank may be increased from time to time by transfer from the

General Reserve Fund or the Special Reserve Fund of such amounts as the Board may, with the

approval of the Minister, resolve.

Under Section 11(1) of the Bank of Mauritius Act 2004, the Board shall determine the net profits of the

Bank for each financial year, after meeting all current expenditure for that year and after making such

provision as it thinks fit for bad and doubtful debts, depreciation in assets, contributions to staff funds

and superannuation funds and other contingencies.

Under Section 11(2) of the Act, the Bank shall establish a General Reserve Fund to which shall be

allocated, at the end of every financial year of the Bank, 15 per cent of the net profits of the Bank.

Under Section 11(3) of the Act, the balance of the net profits for the financial year remaining after the

allocation made under subsection (2) shall, subject to subsection (4), be paid into the Consolidated

Fund as soon as practicable after the end of every financial year. Section 11(4) of the Act provides that

subject to subsection (5), the balance in the General Reserve Fund shall be at least equivalent to the

amount paid as capital of the Bank. Under section 11(5) of the Act, where, at any time, the balance in

the General Reserve Fund is less than the amount paid as capital of the Bank, the Bank shall endeavour

to bring the balance to the required level.

Further under Section 11(6) of the Bank of Mauritius Act 2004, no allocation under subsection (3) shall

be made where, in the opinion of the Board-

(a) the assets of the Bank are, or after such allocation would be, less than the sum of its liabilities

and paid up capital; or

(b) the Bank would not be in a financial position to conduct its activities properly.

Under Section 31(1) of the Act, the financial statements shall be prepared in conformity with

accounting principles applicable to Central Banks and best international practices.

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2. ADOPTION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTINGSTANDARDS

Since the Bank's policy is to prepare financial statements in accordance with International FinancialReporting Standards ("IFRS's"), it has adopted the new and revised Standards and Interpretationsissued by the International Financial Reporting Interpretations Committee ("IFRIC") of the IASB thatare relevant to its operations and effective for accounting period beginning on 1 July 2006. Theadoption of these new and revised Standards and Interpretations has not resulted in changes to theBank's accounting policies that have affected the amounts reported for the current or prior years.

At the date of authorisation of these financial statements, the following Standards and Interpretationswere in issue but not yet effective:

IAS 1 Amendment to IAS 1: Presentation of financial statements - Capital DisclosuresIAS 23 Amendment to IAS 23: Capitalisation of Borrowings CostsIFRS 7 Financial Instruments: DisclosureIFRS 8 Operating SegmentsIFRIC 10 Interim Financial Reporting and ImpairmentIFRIC 11 Group and Share Treasury TransactionsIFRIC 12 Service Concession ArrangementsIFRIC 13 Customer Loyalty ProgrammeIFRIC 14 IAS 19 - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction.

The adoption of the relevant Standards and Interpretations in future periods will not have a materialimpact on the financial statements of the Bank.

3. ACCOUNTING POLICIES

The principal accounting policies adopted by the Bank are as follows:

Basis of preparation

The financial statements are presented in Mauritian Rupee. The financial statements are prepared inconformity with accounting principles applicable to Central Banks and best international practices inaccordance with Section 31(1) of the Bank of Mauritius Act 2004. The Bank's policy is to preparefinancial statements under the historical cost convention as modified by the fair valuation of certainfinancial assets and in accordance with International Financial Reporting Standards (IFRS) in so far asthey are practically applicable to Central Banks.

(a) Financial Instruments

(i) Classification

Assets or liabilities classified as Held-For-Trading, which is a subset of the Fair-Value-Through-Profit-or-Loss ("FVTPL") category, are those that are acquired or incurredprincipally for the purpose of generating profits from short-term fluctuations in price ordealer’s margin. A financial asset should be classified as Held-For-Trading if, regardless ofwhy it was acquired, it is part of a portfolio of identified financial instruments that aremanaged together and for which there is evidence of a recent actual pattern of short-termprofit taking. These may include certain investments, certain purchased loans andderivative financial instruments.

Loans and Receivables are non-derivative financial assets created by the Bank by providingmoney, other than those created with the intention of short-term profit taking. Loans andReceivables comprise mostly of loans and advances to commercial banks or other financialinstitutions under Special Lines of Credit.


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3. ACCOUNTING POLICIES (CONT’D)

(a) Financial Instruments (cont’d)

(i) Classification (cont’d)

Available-For-Sale assets are those non-derivative financial assets that are not classified asfinancial assets at FVTPL, loans and receivables or Held-To-Maturity. Available-For-Saleinstruments include equity investments, Government of Mauritius Treasury Bills, Bank ofMauritius Bills and Other Government Securities.

The Bank has the possibility to designate any financial asset or financial liability as at FVTPL,i.e. at fair value with changes in fair value recognised through profit or loss provided thatthe financial asset or financial liability satisfies certain conditions.

Management determines the appropriate classification of the Bank's financial assets andfinancial liabilities and re-evaluates such classification on a regular basis.

(ii) Initial recognition

The Bank recognises all financial instruments on its balance sheet when it becomes a partyto the contractual provisions of the instrument. All regular transactions entered by the Bankare recognised on a trade date basis.

(iii) Measurement

Financial instruments are initially measured at cost, which is the fair value of theconsideration given (in the case of an asset) or received (in the case of a liability) for it,including transaction costs.

Subsequent to initial recognition, all Available-For-Sale assets are measured at fair value,except for any instrument that does not have a quoted market price in an active market andwhose fair value cannot be reliably measured in which case it is stated at amortised cost orcost, depending on whether a fixed maturity or not, less any impairment loss.

FVTPL (including Held-For-Trading) assets and liabilities are normally measured at fair valueat subsequent reporting dates.

All non-trading financial liabilities are measured at amortised cost using the effectiveinterest rate method.

Gold deposits have prudently been valued at 80% of the price of Gold on Internationalmarket on the last working day of the month.

A financial asset is impaired when its carrying amount exceeds its recoverable amount. Therecoverable amount of a financial asset carried at amortised cost is the present value ofexpected future cash flows discounted at the original effective interest rate of the asset.

(iv) Fair value measurement principles

The fair value of financial instruments is based on their quoted market price at the balancesheet date without any deduction for transaction costs. If a quoted market price is notavailable, the fair value of the instrument is estimated using pricing models or discountedcash flow techniques.

Where discounted cash flow techniques are used, estimated future cash flows are based onmanagement’s best estimates and the discount rate is a market related rate at the balancesheet date for an instrument with similar terms and conditions. Where pricing models areused, inputs are based on market related measures at the balance sheet date.

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(a) Financial Instruments (cont’d)

(v) Gains and losses on subsequent measurement

Gains or losses on FVTPL (including Held-For-Trading) financial assets and financialliabilities arising from changes in their fair value are recognised in the Income Statement inthe period in which they arise. Gains or losses on Available-For-Sale financial assets arerecognised in equity. For those financial instruments carried at amortised cost, gains orlosses are recognised in the Income Statement when the financial instrument isderecognised or impaired and through the amortisation process.

(vi) Specific instruments

Cash and cash equivalents

Cash and cash equivalents comprise cash in hand, cash balances, call deposits with otherfinancial institutions and short-term highly liquid debt investments with remainingmaturities of three months or less.

(b) Computer software

Under revised IAS 38, intangible assets, computer software which do not form an integral part ofcomputer hardware, is now classified as an intangible asset. Intangible assets are stated at cost,net of accumulated amortisation and any accumulated impairment losses. Amortisation isprovided on a straight-line basis at the rate of 33 1/3% per annum so as to write off thedepreciable value of the assets over their estimated useful lives. A full year of amortisation ischarged in the year of purchase.

(c) Property, plant and equipment

Property, plant and equipment are stated at cost, net of accumulated depreciation and anyaccumulated impairment losses. Depreciation is provided on a straight-line basis so as to write offthe depreciable value of the assets over their estimated useful lives. A full year of depreciation ischarged in the year of purchase.

Depreciation is provided at the following annual percentage rates:

Premises - 2%Other properties - 2%Furniture, equipment, fixtures and fittings - 10%Computer hardware - 33 1/3%Motor vehicles - 20% for 1st three years and

subsequently 40%

No depreciation is provided on freehold land and capital work in progress.

(d) Notes and coins in circulation

Notes and coins issued represent an unserviced liability of the Bank of Mauritius and are recordedat face value.

The Bank also issues a range of Mauritius commemorative coins. All costs associated with theproduction of these numismatic coins are expensed in the Income Statement when incurred.


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(e) Retirement benefits

Defined benefit pension plan

The present value of funded obligations is recognised in the balance sheet as a non-currentliability after adjusting for the fair value of plan assets, any unrecognised actuarial gains andlosses and any unrecognised past service cost. The valuation of the funded obligations is carriedout every two years by a firm of actuaries.

(f) Income and expenditure recognition

Income and expenditure are recognised as they are earned or incurred and are recorded in thefinancial statements on an accruals basis to accurately reflect the period to which they relate.

Dividend income from equity investments is accounted for in the Income Statement as otherincome when the right to receive payment is established.

(g) Foreign currencies

Transactions in foreign currencies are recorded in Mauritian Rupees using the rate of exchangeruling at the date of the transactions. Monetary assets and liabilities denominated in foreigncurrencies are translated in Mauritian Rupees using the rate of exchange ruling at the balancesheet date. Foreign exchange differences arising on translation are included in the IncomeStatement in accordance with IAS 21 (The Effects of Changes in Foreign Exchange Rates).However, for the purpose of determining the net profit of the Bank in terms of Section 11 of theBank of Mauritius Act 2004, foreign exchange differences are excluded in accordance withSection 47(2) of the Act. Non-monetary assets and liabilities denominated in foreigncurrencies, which are stated at historical cost, are translated at the foreign exchange rateruling at the date of the transactions.

(h) Impairment

The carrying amounts of assets are reviewed at each balance sheet date to determine whetherthere is any indication of impairment. If any such indication exists, the asset’s recoverableamount is estimated.

An impairment loss is recognised whenever the carrying amount of an asset exceeds itsrecoverable amount. Impairment losses are recognised in the Income Statement.

(i) Taxation

The Bank is exempted from any tax imposed on income, profits or capital gains under Section 64of the Bank of Mauritius Act 2004.

(j) Comparative figures

Comparative figures have been restated or regrouped where necessary to conform to the currentyear's presentation.

4. ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATIONUNCERTAINTY

The preparation of financial statements in accordance with IFRS requires management to exercisejudgement in the process of applying the accounting policies. It also requires the use of accountingestimates and assumptions that may affect the reported amounts and disclosures in the financialstatements. Judgements and estimates are continuously evaluated and are based on historicalexperience and other factors, including expectations and assumptions concerning future events thatare believed to be reasonable under the circumstances. The actual results could, by definitiontherefore, often differ from the related accounting estimates.

Particular areas where management has applied a higher degree of judgement that have a significanteffect on the amounts recognised in the financial statements, or estimations and assumptions thathave a significant risk of causing a material adjustment to the carrying amounts of assets and liabilitieswithin the next financial year, are as follows:-

(i) Financial Assets Available-For-Sale (Note 9)

Government of Mauritius Treasury Bills

Government of Mauritius Treasury Bills have been revalued based on the latest market dataavailable for these instruments, after inclusion of liquidity spreads.

Other Government Securities

Other Government Securities which comprise Mauritius Development Loan Variable Interest Ratestocks have been revalued using the discounted cash flow techniques, based on the latest marketdata available for similar instruments as at the balance sheet date.

(ii) Other Financial Liabilities (Note 14)

Bank of Mauritius Bills

Bank of Mauritius Bills have been revalued using the same valuation method as for Governmentof Mauritius Treasury Bills.

5. CAPITAL AND RESERVES

Capital

The Stated and Paid Up Capital of the Bank is Rs1 billion in accordance with Section 10 of the Bank ofMauritius Act 2004. All amounts paid as capital are subscribed and held solely by the Government(refer to Note 1).

General Reserve Fund

The General Reserve Fund is a reserve fund created in accordance with Section 11 of the Bank ofMauritius Act 2004 (refer to Note 1).

Special Reserve Fund

In terms of Section 47(1) of the Bank of Mauritius Act 2004, the Special Reserve Fund is a reserve builtup from any net realised gains or losses in any financial year of the Bank arising from changes in thevaluation of its assets or liabilities in, or denominated in gold, SDR, or foreign currencies subsequentto any change in the values or exchange rates of gold, SDR, or foreign currencies in terms of thedomestic currency.

Other Reserves

Other Reserves are reserves set up for unforeseen contingencies which may affect the operations ofthe Bank.

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133

6. CASH AND CASH EQUIVALENTS

2007 2006Rs Rs

Deposit Accounts 14,448,198,497 9,077,387,694IMF Special Drawing Rights (SDR) 884,210,067 823,704,492Repurchase Agreement 10,313,524,800 1,434,609,120Current Accounts 826,963,835 431,191,074Foreign Currency Notes and Coins 143,797 30,998Gold Deposits 1,012,862,392 1,066,241,950Foreign Liquid Securities 110,154,329 113,129,233

27,596,057,717 12,946,294,561

7. OTHER BALANCES AND PLACEMENTS

2007 2006Rs Rs

Foreign Investments 12,803,732,981 13,683,383,052Deposit Accounts 11,942,943,452 15,421,959,731

24,746,676,433 29,105,342,783

Foreign investments comprise investments made through the Bank's Investment Manager, as follows:

2007 2006Rs Rs

Cash 52,137,719 36,011,911Bonds 12,749,693,419 13,646,973,517Other investments 1,901,843 397,624

12,803,732,981 13,683,383,052

8. LOANS AND ADVANCES2007 2006

Rs Rs

Special Line of Credit - Sugar Industry 1,339,533,899 1,627,278,849Special Line of Credit - EPZ 221,933 46,008,908Special Line of Credit - National Equity Fund 73,495,281 130,801,226Others 13,592,361 13,030,279

1,426,843,474 1,817,119,262

The above loans and advances are granted to local commercial banks or other financial institutionsunder special lines of credit mainly for onward lending to their customers.

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9. FINANCIAL ASSETS AVAILABLE-FOR-SALE

2007 2006Rs Rs

Government of Mauritius Treasury Bills 576,736,108 3,819,699,315Other Government Securities 43,116,118 36,415,829

619,852,226 3,856,115,144

10. COMPUTER SOFTWARE

RsCostAt 1 July 2005 83,315,82Additions 195,557

At 30 June 2006 83,511,377Additions 139,598Disposal (11,270)

At 30 June 2007 83,639,705

AmortisationAt 30 June 2005 82,132,487Charge for the year 654,004

At 30 June 2006 82,786,491Charge for the year 699,615Disposal (11,170)

At 30 June 2007 83,474,936

Net book value

At 30 June 2007 164,769

At 30 June 2006 724,886


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11. PROPERTY, PLANT AND EQUIPMENTFurniture

Capital EquipmentWork in Other Fixtures & Computer Motor

Premises Progress Properties Fittings Equipment Vehicles Total

Rs Rs Rs Rs Rs Rs RsCOST

At 1 July 2005 51,342,371 666,761,218 67,230,999 64,133,235 22,695,346 26,482,907 898,646,076Additions 127,225 660,263,050 - 21,504,297 684,451 - 682,579,023Disposals (2,553,372) - - (2,101,374) (1,484,553) - (6,139,299)Scrap (6,861,235) - (2,015,921) - (34,400) - (8,911,556)

At 30 June 2006 42,054,989 1,327,024,268 65,215,078 83,536,158 21,860,844 26,482,907 1,566,174,244Additions - 421,206,872 - 78,038,844 1,456,709 3,485,572 504,187,997Disposals - - - (467,518) (363,165) (8,690,462) (9,521,145)

At 30 June 2007 42,054,989 1,748,231,140 65,215,078 161,107,484 22,954,388 21,278,017 2,060,841,096

DEPRECIATION

At 1 July 2005 8,907,648 - 483,820 36,516,919 20,269,724 18,466,928 84,645,039Charge for the year 6,584,652 - 1,532,101 7,941,844 1,564,486 3,509,982 21,133,065Disposals (537,222) - - (1,716,050) (1,480,653) - (3,733,925)Scrap (6,861,235) - (2,015,921) - (34,400) - (8,911,556)

At 30 June 2006 8,093,843 - - 42,742,713 20,319,157 21,976,910 93,132,623Charge for the year 821,215 - - 15,689,574 1,763,012 1,907,135 20,180,936Disposals - - - (353,034) (362,165) (5,214,277) (5,929,476)

At 30 June 2007 8,915,058 - - 58,079,253 21,720,004 18,669,768 107,384,083

NET BOOK VALUE

At 30 June 2007 33,139,931 1,748,231,140 65,215,078 103,028,231 1,234,384 2,608,249 1,953,457,013

At 30 June 2006 33,961,146 1,327,024,268 65,215,078 40,793,445 1,541,687 4,505,997 1,473,041,621

The capital work in progress relates to the Bank of Mauritius new Head Office building project.

12. OTHER ASSETS

2007 2006Rs Rs

Net Cheques to be cleared 355,800,147 148,984,738Staff Loans 74,575,704 79,349,006Prepayments 3,981,398 83,704,381Dodo Gold Coins with Banks 12,708,700 12,641,100Interest Receivable 19,545,830 16,225,382Others 95,188,278 40,621,170

561,800,057 381,525,777

Net cheques to be cleared are cheques collected and cleared on the next working day.

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11. PROPERTY, PLANT AND EQUIPMENTFurniture

Capital EquipmentWork in Other Fixtures & Computer Motor

Premises Progress Properties Fittings Equipment Vehicles Total

Rs Rs Rs Rs Rs Rs RsCOST

At 1 July 2005 51,342,371 666,761,218 67,230,999 64,133,235 22,695,346 26,482,907 898,646,076Additions 127,225 660,263,050 - 21,504,297 684,451 - 682,579,023Disposals (2,553,372) - - (2,101,374) (1,484,553) - (6,139,299)Scrap (6,861,235) - (2,015,921) - (34,400) - (8,911,556)

At 30 June 2006 42,054,989 1,327,024,268 65,215,078 83,536,158 21,860,844 26,482,907 1,566,174,244Additions - 421,206,872 - 78,038,844 1,456,709 3,485,572 504,187,997Disposals - - - (467,518) (363,165) (8,690,462) (9,521,145)

At 30 June 2007 42,054,989 1,748,231,140 65,215,078 161,107,484 22,954,388 21,278,017 2,060,841,096

DEPRECIATION

At 1 July 2005 8,907,648 - 483,820 36,516,919 20,269,724 18,466,928 84,645,039Charge for the year 6,584,652 - 1,532,101 7,941,844 1,564,486 3,509,982 21,133,065Disposals (537,222) - - (1,716,050) (1,480,653) - (3,733,925)Scrap (6,861,235) - (2,015,921) - (34,400) - (8,911,556)

At 30 June 2006 8,093,843 - - 42,742,713 20,319,157 21,976,910 93,132,623Charge for the year 821,215 - - 15,689,574 1,763,012 1,907,135 20,180,936Disposals - - - (353,034) (362,165) (5,214,277) (5,929,476)

At 30 June 2007 8,915,058 - - 58,079,253 21,720,004 18,669,768 107,384,083

NET BOOK VALUE

At 30 June 2007 33,139,931 1,748,231,140 65,215,078 103,028,231 1,234,384 2,608,249 1,953,457,013

At 30 June 2006 33,961,146 1,327,024,268 65,215,078 40,793,445 1,541,687 4,505,997 1,473,041,621

The capital work in progress relates to the Bank of Mauritius new Head Office building project.

12. OTHER ASSETS

2007 2006Rs Rs

Net Cheques to be cleared 355,800,147 148,984,738Staff Loans 74,575,704 79,349,006Prepayments 3,981,398 83,704,381Dodo Gold Coins with Banks 12,708,700 12,641,100Interest Receivable 19,545,830 16,225,382Others 95,188,278 40,621,170

561,800,057 381,525,777

Net cheques to be cleared are cheques collected and cleared on the next working day.


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15. PROVISION2007 2006

Rs Rs

Balance at 1 July and 30 June 100,000,000 100,000,000

The provision relates to the liquidation of the MCCB Limited. Under the MCCB Limited (Liquidation) Act1996, the Bank may make additional funds available to the liquidator of MCCB Limited where theliabilities of the MCCB Limited exceed the proceeds from the realisation of its assets. The liquidation ofMCCB Limited is still in progress.

16. EMPLOYEE BENEFIT OBLIGATIONS

Amount recognised in Balance Sheet:

2007 2006Rs Rs

Defined benefit plan (Note (a)) 51,080,000 34,720,000

(a) Defined benefit plan

The Bank operates a defined benefit plan for some of its employees and the plan is whollyfunded. The assets of the funded plan are held independently and administered by The StateInsurance Company of Mauritius Ltd.

Amount recognised in Income Statement:2007 2006

Rs Rs

Current service cost 11,830,000 12,790,000Expected return on plan assets (29,840,000) (26,540,000)Interest costs 38,390,000 37,690,000Actuarial loss 450,000 3,240,000

Net periodic pension cost included in staff costs 20,830,000 27,180,000

Actual return on plan assets 43,150,000 33,140,000

Movement in liability recognised in the Balance Sheet:

2007 2006Rs Rs

At 1 July 34,720,000 34,720,000Total expenses as per above 20,830,000 27,180,000Employer contributions (16,080,000) (15,560,000)Charge for the previous year recognisedin the current year (see note) 11,620,000 (11,620,000)

Underprovision (10,000) -

At 30 June 51,080,000 34,720,000

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16. EMPLOYEE BENEFIT OBLIGATIONS ( CONT’D)

(a) Defined benefit plan (cont’d)

Movements in the present value of the defined benefit obligations in the current period were as follows:

2007 2006Rs Rs

At 1 July (365,610,000) (358,990,000)Current service cost (11,830,000) (12,790,000)Interest cost (38,390,000) (37,690,000)Actuarial (losses)/gains (14,500,000) 31,240,000Benefits paid 25,270,000 12,620,000

At 30 June (405,060,000) (365,610,000)

Movements in the present value of the plan assets in the current period were as follows:

2007 2006Rs Rs

At 1 July 275,890,000 239,810,000Expected return on plan assets 29,840,000 26,540,000Actuarial gains 13,310,000 6,600,000Contributions from the employer 16,450,000 15,880,000Benefits paid (25,270,000) (12,620,000)Scheme expenses (370,000) (320,000)

At 30 June 309,850,000 275,890,000

The major categories of plan assets, and the expected rate of return at the balance sheet date foreach category, is as follows:

Expected rate of return at

30 June 30 June2007 2006

% %

Local equities 18 16Overseas equities and bonds 18 17Fixed interest 63 66Others 1 1


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(a) Defined benefit plan (cont’d)

Amounts recognised in the balance sheet:2007 2006

Rs Rs

Total market value of assets 309,850,000 275,890,000Present value of plan liability (405,060,000) (365,610,000)

Deficit (95,210,000) (89,720,000)Unrecognised actuarial loss 44,120,000 43,380,000Underprovision in the current year 10,000 -Charge not recognised in theprevious year (see note) - 11,620,000

(51,080,000) (34,720,000)

The overall expected rate of return is a weighted average of the expected returns of the variouscategories of plan assets held. The directors' assessment of the expected returns is based on historicalreturn trends and analysts' predictions of the market for the asset in the next twelve months.

The actual return on plan assets was Rs43.15 M (2006: Rs33.14M).

The history of experience adjustments is as follows:-2007 2006

Rs Rs

Present value of defined benefit obligation (405,060,000) (365,610,000)Fair value of plan assets 309,850,000 275,890,000Surplus 95,210,000 89,720,000Experience (losses)/gains on plan liabilities (14,500,000) 31,240,000Experience gains on plan assets 13,310,000 6,600,000

The Bank expects to make a contribution of Rs16.17M to the defined benefit plans during the nextfinancial year.

The history of experience adjustments is as follows:-2007 & 2006

Discount rate 10.5%Expected return on plan assets 11.0%Future long-term salary increases 7.5%Post retirement mortality tables increases 5.5%

Note: As mentioned in note 3 (e) it is the policy of the Bank to revalue the retirement benefitobligations every two years. The previous actuarial valuation was effected in June 2005. Theactuarial report of SICOM Ltd dated 7 August 2007 also provides figures for the financialyear June 2006 and necessary amendments were made in the accounts for the year ended30 June 2006. The effect of the change in estimate is recognised prospectively in the currentyear's income statement in accordance with IAS 8 Accounting Policies, Changes inAccounting Estimates and Errors.

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(b) Defined contribution pension fund

2007 2006Rs Rs

Contributions expensed 15,180,341 15,123,336

(c) State pension plan2007 2006

Rs Rs

National Pension Scheme contributions charged 644,829 625,709

17. OTHER LIABILITIES2007 2006

Rs Rs

Profit Payable to the Government of Mauritius for Transfer to Consolidated Fund in accordance with Section 11 (3) of the Bank of Mauritius Act 2004 900,000,000 600,000,000Customers' Credits 205,333,100 283,793,093Abandoned Funds from Banks 157,272,196 141,231,992Interests and Charges Payable 16,616,434 39,894,970Foreign Bills sent for Collection 88,849,245 33,998,643Reserve for Repayment of Capital and Interest:- Bank of Mauritius Savings Bonds 169,200 169,200Others 102,750 102,750

1,368,342,925 1,099,190,648

18. INCOME FROM FINANCIAL ASSETS

(i) Interest and Similar Income on Foreign Assets

2007 2006Rs Rs

Deposit Accounts 1,264,452,823 909,073,701Foreign Investments 594,843,946 264,826,891Special Drawing Rights 36,353,740 24,959,128Repurchase Agreements 198,736,471 41,195,092Current Accounts 12,818,509 5,445,681Gold Deposits 180,914 242,032

2,107,386,403 1,245,742,525


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18. INCOME FROM FINANCIAL ASSETS (CONT’D)

(ii) Interest and Similar Income on Local Assets2007 2006

Rs Rs

Loans and AdvancesLeasing Facilities/Special Lines of Credit to EPZ,Freeport Sectors and Sugar Industry 62,076,156 115,045,795Loans and Advances to Banks/Government 78,122,895 591,519Special Line of Credit - National Equity Fund 5,480,995 4,519,382Advances under Repurchase Transactions 3,147,904 911,928

148,827,950 121,068,624Other Government Securities 4,514,101 3,067,401Other Loans 2,062,614 2,181,496

155,404,665 126,317,521

(iii) Others2007 2006

Rs Rs

Revaluation of Government Securities 198,746,506 171,565,736Profit on Sale of Government of MauritiusTreasury Bills - Secondary Market Cell 35,536,199 21,728,325Dividend Received 530,754 628,792Net (Loss)/Profit on Sale of Gold and Gold Coins (39,667) 564,611Profit on Issue of Mauritius Commemorative Coins 291,209 -Profit on issue of Mauritius Conservative Coins - 105,870Profit on Sale of Foreign Currency Notes to banks 4,910 3,666

235,069,911 194,597,000

Total Income from Financial Assets 2,497,860,979 1,566,657,046

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19. OTHER INCOME

2007 2006Rs Rs

Processing and Licence Fees 18,710,108 6,891,110MACSS and MCIB Fees 1,923,707 1,347,626Commissions 645,688 429,382Premises Rental Account 11,050 28,600

21,290,553 8,696,718

20. EXPENDITURE ON FINANCIAL LIABILITIES

2007 2006Rs Rs

Interest Expense and Similar Charges Bank of Mauritius Bills 310,002,785 342,780,259Reverse Repurchase Transactions 21,956,286 1,061,698Government of Mauritius Surplus Balance 4,405,105 -IBRD Financial Sector Infrastructure Project Loan 4,496,098 5,174,659

340,860,274 349,016,616

21. STAFF SALARIES AND OTHER BENEFITS

2007 2006Rs Rs

Staff Salaries and Allowances 117,550,565 115,850,053Pension Cost (including Governor andDeputy Governor ) 32,808,688 15,876,701

Staff Family Protection Scheme 4,964,807 7,243,697National Savings Fund 644,829 625,709

155,968,889 139,596,160

22. DIRECTORS' REMUNERATION2007 2006

Rs Rs

Governor and Deputy Governors( includes payment of unutilised leaves tothe former Governor and former FirstDeputy Governor) 10,140,600 5,244,919Non-Executive Directors 1,620,000 1,220,000

11,760,600 6,464,919


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24. RECONCILIATION OF PROFIT TO NET CASH INFLOW FROM OPERATINGACTIVITIES

2007 2006Rs Rs

Net Profit for the Year in terms of IFRS 5,254,029,830 3,158,727,122Adjustments for:Non-Cash Increase in Employee Benefit Obligations 16,360,000 -Amortisation of Intangible Assets 699,615 654,004Depreciation of Property, Plant and Equipment 20,180,936 21,133,065Loss on Sale of Property, Plant and Equipment 1,433,849 1,724,874Dividend Received (530,754) (628,792)Fair Value increase on Other Investments (467,198) (932,615)

Operating Profit Before Working Capital Changes 5,291,706,278 3,180,677,658

Increase in Interest Receivable (33,426,431) (45,375,861)Decrease in Loans and Advances 390,275,788 90,444,521Increase in Other Assets (180,274,280) (110,518,601)Increase in Notes and Coins in Circulation 1,263,606,386 310,705,445Decrease in Government Demand Deposits (1,104,475,450) (123,659,972)Increase in Banks' Demand Deposits 432,671,389 3,076,190,476Increase/(Decrease) in Other Financial Institutions'Demand Deposits (135,118,358) 100,321,813Increase in Other Demand Deposits 541,665,303 43,265,112Increase in Other Liabilities 269,152,277 67,213,606Increase/(Decrease) in Other Financial Liabilities 1,720,689,907 (5,100,963,844)

Net Cash Inflow From Operating Activities 8,456,472,809 1,488,300,353

25. COMMITMENTS AND OTHER CONTINGENCIES

Commitments and other contingencies not otherwise provided for in the accounts and which existed at 30June 2007 are as follows:

(i) Numismatic Coins

Numismatic coins are not taken into account in the determination of the Bank’s liabilities but a liabilitymay arise if such coins are encashed for their face value. The Bank is of the opinion that in the unlikelyevent of encashment as legal tender, no significant loss is expected to arise.

(ii) Capital Subscription in the African Export - Import Bank

The Bank has a commitment to pay USD 900,000 for capital subscription in the African Export-ImportBank when call for payment will be made. This amount has not been accounted for as a liability in thefinancial statements.

(iii) Legal case against the Bank

The Bank has a contingent liability with respect to a claim made by a company for an amount of Rs15.3M. However, this is not provided for in the financial statements as it is being disputed.

The Bank is of the opinion that the likely outcome of the above item cannot be determined withreasonable certainty and therefore no provision has been made in these financial statements.

144


26. FINANCIAL INSTRUMENTS (CONT'D)

(i) Introduction

A financial instrument, as defined by IAS 32 (Financial Instruments: Disclosure and Presentation),is any contract that gives rise to both a financial asset of one enterprise and a financial liability orequity instrument of another enterprise.

(ii) Credit Risk

Disclosure of credit risk enables the users of financial statements to assess the extent to whichfailures by counterparties to discharge their obligations could reduce the amount of future cashinflows from financial assets held at the balance sheet date.

This information can be obtained directly from the balance sheet and related notes in respect ofcredit exposures such as loans and deposits.

(iii) Market Risk

All financial instruments are subject to market risk, the risk that future changes in marketconditions may make an instrument less valuable or more onerous.

(iv) Liquidity Risk

Liquidity risk is the risk that an entity may not be able to accommodate decreases in liabilities orto fund increases in assets in full at the time that a commitment or transaction is due forsettlement. In the case of the Bank, this risk is not relevant to local assets and liabilities becauseof the Bank's ability to create Mauritian rupees when required. However, the Bank does faceliquidity risk in respect of foreign assets and liabilities.

Maturity Analysis

Above 3 Above 6 Above 9 BetweenUp to 3 and up to and up to and up to 1 and 5 Abovemonths 6 months 9 months 12 months years 5 years Total

Rs Rs Rs Rs Rs Rs RsAt 30 June 2007

AssetsForeign Assets 27,828,154,273 5,986,872,326 1,239,274,958 4,894,887,513 12,834,406,901 - 52,783,595,971Loans and Advances 202,393,292 107,098,936 110,930,597 118,934,433 851,772,646 35,713,570 1,426,843,474Financial Assets Available-For-Sale 48,820,000 195,560,130 151,920,978 180,435,000 43,116,118 - 619,852,226Computer Software - - - 164,769 - - 164,769Property, Plant and Equipment - - - - 1,953,457,013 - 1,953,457,013Other Assets - - - - - 561,800,057 561,800,057

Total Assets 28,079,367,565 6,289,531,392 1,502,126,533 5,194,421,715 15,682,752,678 597,513,627 57,345,713,510

LiabilitiesNotes and Coins in Circulation - - - - - 13,591,121,168 13,591,121,168Demand Deposits 11,698,048,486 - - - - - 11,698,048,486Other Financial Liabilities 5,135,283,911 257,283,106 521,359,384 - - 56,945,378 5,970,871,779Provision - - - - 100,000,000 - 100,000,000Employee Benefit Obligations - - - - - 51,080,000 51,080,000Other Liabilities - 900,000,000 - - 468,342,925 - 1,368,342,925

Total Liabilities 16,833,332,397 1,157,283,106 521,359,384 - 568,342,925 13,699,146,546 32,779,464,358

Net Liquidity Gap 11,246,035,168 5,132,248,286 980,767,149 5,194,421,715 15,114,409,753 (13,101,632,919) 24,566,249,152

*Note: The net liquidity risk for above five years excluding Notes and Coins in Circulation will amount to Rs489,488,249


145

26. FINANCIAL INSTRUMENTS (CONT'D)

(iv) Liquidity Risk (cont’d)

Maturity Analysis (cont’d)

Above 3 Above 6 Above 9 BetweenUp to 3 and up to and up to and up to 1 and 5 Abovemonths 6 months 9 months 12 months years 5 years Total

Rs Rs Rs Rs Rs Rs Rs

At 30 June 2004

AssetsForeign Assets 12,984,809,962 5,043,372,306 3,385,463,655 7,342,833,818 13,702,125,795 - 42,458,605,536Loans and Advances 120,513,232 111,763,509 101,477,117 178,746,739 1,158,045,822 146,572,843 1,817,119,262Financial Assets Available-For-Sale 559,054,984 1,119,772,290 619,681,288 1,521,190,753 - 36,415,829 3,856,115,144Computer Software - - - - - 724,886 724,886Property, Plant and Equipment - - - - - 1,473,041,621 1,473,041,621Other Assets - - - - - 381,525,777 381,525,777

Total Assets 13,664,378,178 6,274,908,105 4,106,622,060 9,042,771,310 14,860,171,617 2,038,280,956 49,987,132,226

LiabilitiesNotes and Coins in Circulation - - - - - 12,327,514,782 12,327,514,782Demand Deposits 11,963,305,602 - - - - - 11,963,305,602Other Financial Liabilities 1,729,827,252 1,620,434,338 369,367,046 465,669,126 - 64,884,110 4,250,181,872Provision - - - - 100,000,000 - 100,000,000Employee Benefit Obligations - - - - - 34,720,000 34,720,000Other Liabilities 204,633,170 600,000,000 - - - 294,557,478 1,099,190,648

Total Liabilities 13,897,766,024 2,220,434,338 369,367,046 465,669,126 100,000,000 12,721,676,370 29,774,912,904

Net Liquidity Gap (233,387,846) 4,054,473,767 3,737,255,014 8,577,102,184 14,760,171,617 (10,683,395,414) 20,212,219,322

* Note: The net liquidity risk for above five years excluding Notes and Coins in Circulation will amount to Rs1,644,119,368

(v) Foreign Currency Risk

The Bank of Mauritius has monetary assets and liabilities denominated in foreign currencies,which consist mainly of US Dollar, Pound Sterling and Euro.

The Bank does not hedge against risk of fluctuations in exchange rates. However, it has setaside a reserve for foreign exchange rate fluctuations called Special Reserve Fund, which isused to cater for movements due to appreciation/depreciation in foreign exchange.

(vi) Interest Rate Risk

Repricing Analysis

Changes in market interest rates have a direct effect on the contractually determined cashflows associated with specific financial assets and financial liabilities, whose interest rates areperiodically reset to market, as well as the fair values of other instruments on which theinterest rates are fixed throughout the period of the contract.

The rates on financial assets and financial liabilities which are interest-bearing are set at orabout current market levels.

146


26. FINANCIAL INSTRUMENTS (CONT’D)

(vi) Interest Rate Risk (cont’d)

Repricing Analysis (cont’d)

Amounts due to and from the IMF are subject to special interest arrangements and it is notpracticable to assess the fair value of such balances as these types of transactions are confinedto Central Banks.

The Bank’s international foreign reserves management includes investments in a variety offoreign currency denominated cash, deposits and other securities. The Board’s stated goal is tomaximise liquidity and security via quality investments and, within these constraints, earn themaximum rate of return possible.

The table below summarises the Bank's exposure to interest rate risk. Included in the table arethe Bank's assets and liabilities at carrying amounts, categorised by whether they are at floatingrates or, if not, the earlier of contractual repricing or maturity dates.

Above 3 Above 6 Above 9Up to 3 and up to and up to and up to Over Non-interestmonths 6 months 9 months 12 months 12 months bearing Total


AssetsForeign Assets 20,236,974,080 8,108,383,567 1,212,213,900 9,981,285,826 12,803,732,980 441,005,618 52,783,595,971Loans and Advances 200,945,157 107,098,936 110,930,597 118,934,433 875,341,990 13,592,361 1,426,843,474Financial Assets Available -For-Sale 48,820,000 189,951,000 - 337,965,108 43,116,118 - 619,852,226Computer Software - - - - - 164,769 164,769Property, Plant and Equipment - - - - - 1,953,457,013 1,953,457,013Other Assets - - - - - 561,800,057 561,800,057

Total Assets 20,486,739,237 8,405,433,503 1,323,144,497 10,438,185,367 13,722,191,088 2,970,019,818 57,345,713,510

LESS: LiabilitiesNotes and Coins in Circulation - - - - - 13,591,121,168 13,591,121,168Demand Deposits - - - - - 11,698,048,486 11,698,048,486Other Financial Liabilities 4,022,489,228 1,370,077,789 - 521,359,384 56,945,378 - 5,970,871,779Provision - - - - - 100,000,000 100,000,000Employee Benefit Obligations - - - - - 51,080,000 51,080,000Other Liabilities - - - - - 1,368,342,925 1,368,342,925

Total Liabilities 4,022,489,228 1,370,077,789 - 521,359,384 56,945,378 26,808,592,579 32,779,464,358

On Balance Sheet InterestSensitivity Gap 16,464,250,009 7,305,355,714 1,323,144,497 9,916,825,983 13,665,245,710 (23,838,472,164) 24,566,249,152


147

26. FINANCIAL INSTRUMENTS (CONT’D)

(vi) Interest Rate Risk (cont’d)

Repricing Analysis (cont’d)

Above 3 Above 6 Above 9Up to 3 and up to and up to and up to Over Non-interestmonths 6 months 9 months 12 months 12 months bearing Total


AssetsForeign Assets 7,076,329,428 2,112,286,350 3,629,709,750 15,549,897,766 13,683,383,052 406,999,190 42,458,605,536Loans and Advances 120,513,232 113,124,050 101,477,117 178,746,739 1,291,588,386 11,669,738 1,817,119,262Financial Assets Available -For-Sale 281,382,184 482,820,000 1,775,971,351 1,279,525,780 36,415,829 - 3,856,115,144Computer Software - - - - - 724,886 724,886Property, Plant and Equipment - - - - - 1,473,041,621 1,473,041,621Other Assets - - - - - 381,525,777 381,525,777

Total Assets 7,478,224,844 2,708,230,400 5,507,158,218 17,008,170,285 15,011,387,267 2,273,961,212 49,987,132,226

LESS: LiabilitiesNotes and Coins in Circulation - - - - - 12,327,514,782 12,327,514,782Demand Deposits - - - - - 11,963,305,602 11,963,305,602Other Financial Liabilities 420,197,133 1,808,022,543 - 1,173,587,922 847,430,874 943,400 4,250,181,872Provision - - - - - 100,000,000 100,000,000Employee Benefit Obligations - - - - - 34,720,000 34,720,000Other Liabilities - - - - - 1,099,190,648 1,099,190,648

Total Liabilities 420,197,133 1,808,022,543 - 1,173,587,922 847,430,874 25,525,674,432 29,774,912,904

On Balance Sheet InterestSensitivity Gap 7,058,027,711 900,207,857 5,507,158,218 15,834,582,363 14,163,956,393 (23,251,713,220) 20,212,219,322

Effective Interest Rates

The interest-bearing assets earn interest at rates ranging from 5.75% p.a. to 13% p.a. (2006:2.50% p.a. to 10.50% p.a.) for assets denominated in Mauritian rupees and from 0.01% p.a. to8.165% p.a. (2006: 0.01% p.a. to 7.50% p.a.) for assets denominated in foreign currencies.

The interest-bearing liabilities bear interest at rates ranging from 5.84% p.a. to 11.91% p.a.(2006: 5.02% p.a. to 7.94% p.a.) for liabilities denominated in Mauritian rupees and from5.99% p.a. to 7.30% p.a. (2006: 5.99% p.a. to 7.30% p.a.) for liabilities denominated inforeign currencies.

27. RELATED PARTY TRANSACTIONS

The balances and transactions with Government of Mauritius, the shareholder, are disclosed in notes9, 17 and 18 to the accounts.

Short term benefits payable to directors are disclosed in note 22.

The Bank contributes for the post retirement benefits of all its employees including the ExecutiveDirectors. Contribution made for the year for the benefit of present and past Governor and DeputyGovernors is Rs1,268,347.

148


28. REPURCHASE TRANSACTIONS

Repurchase transactions are conducted under the umbrella of the Master Repurchase Agreement thathas been signed by all Former Category 1 Banks with the Bank of Mauritius. The repurchasetransactions are treated as secured loans received or granted without changes in the portfolio of billsgiven as collateral.

From the Central Bank's point of view, reverse repurchase transactions involve absorbing liquidityfrom the domestic market by selling bills whereas repurchase transactions involve injecting liquidityin the market by purchasing bills.

29. TRANSACTIONS WITH THE INTERNATIONAL MONETARY FUND ("IMF")

As a member of the IMF, Mauritius was allocated SDR 15,744,000 on which quarterly charges arepayable to IMF. The Fund pays interest to the Bank on a quarterly basis on its SDR Holdings.

For revaluation purposes and quota subscription, the Bank maintains different accounts of the IMF.The IMF No. 1 and No. 2 accounts appear in the books of the Bank under the heading “DemandDeposits from Other Financial Institutions". The balance in the IMF No. 1 is reflected in "Loans andAdvances" as International Subscriptions by Government whereas the Securities Account is kept offBalance Sheet.

Any increase in quota is subscribed in local currency and any freely convertible currency.

The value of the portion payable in freely convertible currency is debited to the account ofGovernment maintained with the Bank and the quota increase in local currency is paid by way ofnon-negotiable, non-interest bearing securities issued by Government in favour of IMF, which arerepayable on demand. These securities are lodged with the Bank acting as custodian and are kept inbook entry form at the Bank as they form part of the accounts and records of Government.

The Bank of Mauritius revalues IMF accounts in its balance sheet in accordance with the practices ofthe IMF’s Treasury Department. In general, the revaluation is effected annually and whenever theFund makes use of Mauritian rupees in accordance with the Designation Plan.

Annual Report 2006-07 List of Charts

149

List of Charts

Page14 I.1 Per capita GNI and Growth Rate15 I.2 Ratios of GDFCF and GNS to GDP at Market Prices15 I.3 Investment by Sector in 200616 I.4 Growth Rates of Public and Private Investment17 I.5 Sectoral Distribution of GDP at Basic Prices in 200618 I.6 Tourist Arrivals and Tourism Receipts24 II.1 Unemployment Rate 24 II.2 Growth Rates of Average Compensation, Unit Labour Cost and

Labour Productivity – Total Economy24 II.3 Growth Rates of Average Compensation, Unit Labour Cost and

Labour Productivity – Manufacturing Sector25 II.4 and II.5 Monthly Evolution of Twelve Divisions of the CPI Basket of Goods

and Services during 2006-0726 II.6 Headline and Core Inflation 41 III.1 Sectorwise Contribution to the Increase in Credit to the Private

Sector by Banks in 2006-0746 III.2 Simple Average Bank Rate, Weighted Average Interbank Interest

Rate and Inflation Rate46 III.3 Weighted Average Lending and Term Deposits Rates47 III.4 Movements in the SEMDEX and SEM-7 52 IV.1 Composition of Government Expenditure54 IV.2 Composition of Public Debt as at end-June 200765 V.3 Movements of the Daily Exchange Rate of the Rupee vis-à-vis Major

Currencies: 2005-0685 2.1 Components of Income 85 2.2 Components of Net Interest Income86 2.3 Returns on Equity and on Average Assets86 2.4 Consolidated Operating Profit and Profit after Tax88 3.1 Auctioning of Treasury/Bank of Mauritius Bills 89 3.2 Weighted Average Yields on Treasury/Bank of Mauritius Bills at

Primary Auctions90 3.3 Excess Liquidity, Interbank Transactions and Weighted Average

Interbank Interest Rate97 3.4 Monthly Average Liquidity and Intervention on the Foreign

Exchange Market97 3.5 Banks' Transactions above US$30,000: Total Purchases and Sales97 3.6 Banks' Transactions above US$30,000: Turnover by Currency98 3.7 Weighted Average Dealt Rates of the Rupee against Major

Currencies

150

List of Tables Annual Report 2006-07

List of Tables

Page

13 I.1 Main National Accounting Aggregates and Ratios15 I.2 Real Growth Rates of GDFCF by Type of Capital Goods16 I.3 Real Growth Rates of GDFCF by Industrial Use 17 I.4 Main Aggregates of the Agricultural Sector18 I.5 Main Aggregates of the Manufacturing Sector21 II.1 Average Monthly Earnings in Large Establishments21 II.2 Annual Percentage Change in Wage Rate Index by Industry Group22 II.3 Labour Market Indicators23 II.4 Employment by Industrial Group26 II.5 Quarterly Percentage Change in the Sub-indices of the CPI by Division27 II.6 Headline and Core Inflation Rates27 II.7 Price Indicators33 III.1 Depository Corporations Survey34 III.2a Monetary Ratios35 III.2b Income Velocity of Circulation of Money36 III.3 Central Bank Survey37 III.4 Other Depository Corporations Survey39 III.5 Banks Survey40 III.6 Non-Bank Deposit-Taking Institutions’ Survey42-44 III.7 Sectorwise Distribution of Credit to the Private Sector44 III.8 Average Cash Ratio Maintained by Banks45 III.9 Other Interest Rates50 IV.1 Classification of Government Revenue and Grants51 IV.2 Distribution of Government Expenditure53 IV.3 Budgetary Operations and Financing55 IV.4 Public Debt57 V.1 Balance of Payments Summary59 V.2 Net International Reserves62 V.3 Exchange Rate of the Rupee vis-à-vis Major Trading Partner Currencies84 2.1 Risk Weighted Capital Adequacy Ratio85 2.2 Consolidated Profit Performance86 2.3 Financial Performance88 3.1 Auctioning of Treasury/Bank of Mauritius Bills 89 3.2 Repurchase Transactions between the Bank of Mauritius and Banks 91 3.3 Interbank Transactions91 3.4 Interbank Interest Rates92 3.5 Primary Dealer Activities93 3.6 Purchases and Sales of Treasury/Bank of Mauritius Bills by Primary

Dealers94 3.7 Dealings in Government Securities/Bank of Mauritius Bills95 3.8 Trading of Treasury/Bank of Mauritius Bills on The Stock Exchange

of Mauritius

Annual Report 2006-07 List of Tables

151

96 3.9 Interbank Foreign Exchange Market 96 3.10 Intervention by the Bank of Mauritius on the Interbank Foreign Exchange

Market 98 3.11 Weighted Average Dealt Selling Rates of the Rupee99 3.12 Auctions of Five-Year Government of Mauritius Bonds99 3.13 Auctions of Mauritius Development Loan Stocks100 3.14 Auction of Treasury Notes104 4.1 Mauritius Automated Clearing and Settlement System (MACSS): Total

Transactions 105 4.2 Cheque Clearances106 4.3 Intra Bank Cheque Clearing Transactions

Annual Report 2006-07 Statistical Tables

153

Appendix I Statistical Tables

Page 157 1. Selected Economic Indicators

2. Money and Banking

158 2.1 Bank of Mauritius Claims on Government159 2.2 Currency in Circulation160 2.3 (a) Banks - Assets161 (b) Banks - Liabilities162 2.4 Principal Interest Rates163 2.5 Value Range of Banks’ "Overdrafts", "Loans", "Loans and Other Financing in

Foreign Currencies", "Local Bills Discounted", "Bills Receivable" and "AdvancesAgainst Pledge of Export Bills": June 2007

164 2.6 Ownership of Banks’ "Overdrafts", "Loans", "Loans and Other Financing in ForeignCurrencies", "Local Bills Discounted", "Bills Receivable" and "Advances AgainstPledge of Export Bills": June 2007

165 2.7 Ownership of Banks' Deposits: June 2007166 2.8 Value Range of Banks' Deposits: June 2007167 2.9 Maturity Pattern of Banks’ Time Deposits: June 2007168 2.10 Maturity Pattern of Banks’ Foreign Currency Deposits: June 2007169 2.11 Central Bank Survey170 2.12 Other Depository Corporations Survey171 2.13 Depository Corporations Survey173 2.14 Sectoral Balance Sheet of the Bank of Mauritius (a) Assets174 (b) Liabilities175 2.15 Sectoral Balance Sheet of Other Depository Corporations (a) Assets176 (b) Liabilities177 2.16 Sectoral Balance Sheet of Banks (a) Assets178 (b) Liabilities179 2.17 Sectoral Balance Sheet of Non-Bank Deposit-Taking Institutions (a) Assets180 (b) Liabilities181 2.18 Cheque Clearances182 2.19 Electronic Banking Transactions183 2.20 Transactions on The Stock Exchange of Mauritius

3. External Trade and Balance of Payments

184 3.1 Exchange Rates185 3.2 Daily Average Exchange Rates186 3.3 Exchange Rate Movements of Selected Currencies vis-à-vis the Euro187 3.4 Gross Official International Reserves188 3.5 Net International Reserves189 3.6 Exports - Principal Countries of Destination190 3.7 Direction of EPZ Exports191 3.8 EPZ Imports and Exports by Main Commodities192 3.9 Imports and Exports - Major Commodity Groups

193 3.10 Merchandise Imports194 3.11 Imports - Main Sources of Supply195 3.12 Export and Import Price Indices196 3.13 (a) Tourist Earnings196 (b) Tourist Arrivals by Country of Residence196 (c) Average Stay of Tourists197 (d) Tourist Arrivals and Tourist Earnings: January 2004 – June 2007198 3.14 (a) Foreign Direct Investment in Mauritius by sector: 1990-2006 and First

Half of 2007 198 (b) Foreign Direct Investment in Mauritius by Country of Origin: 1990 –

2006 and First Half of 2007 199 3.15 (a) Direct Investment Abroad by Sector: 1990 – 2006 and First Half of 2007 199 (b) Direct Investment Abroad by Host Country: 1990 – 2006 and First Half

of 2007 200-201 3.16 Balance of Payments: 2004-2006202-203 3.17 Quarterly Balance of Payments: 2006-07

4. National Income and Production

204 4.1 (a) Gross Domestic Product by Industry Group at Current Basic Prices205 (b) GDP-Sectoral Real Growth Rates206 (c) GDP-Quarterly Sectoral Real Growth Rates207 4.2 Distribution of Gross Domestic Product at Current Prices207 4.3 Expenditure on Gross Domestic Product at Current Prices208 4.4 Gross Domestic Fixed Capital Formation at Current Prices by Type and Use209 4.5 Labour Productivity and Unit Labour Cost210 4.6 Sugar Production and Yields211 4.7 Sugar Production and Disposal212 4.8 Production of Selected Commodities213 4.9 Electricity - Production and Consumption

5. Prices

214 5.1 Consumer Price Indices

6. Public Finance

215 6.1 External Debt

Statistical Tables Annual Report 2006-07

154

1. Population-Republic of Mauritius 1* Mid-year 1,160,421 1,175,267 1,186,873 5 1,199,881 1,210,196 1,222,811 1,233,386 1,243,252 1,252,698 1,260,407 3

2. Tourist Arrivals*** Fiscal Year ended June 555,616 565,324 620,030 658,351 667,236 694,247 699,389 735,495 771,889 860,252

3. Tourist Earnings Fiscal Year ended June (Rs million) 11,026 12,764 14,344 15,527 19,045 17,998 22,394 24,097 28,571 36,243

4. Real GDP Growth Rate* Calendar Year (Per cent) 5.8 2.1 9.7 5.2 2.6 4.4 4.8 2.3 5.0 2 5.4 2

5. Gross Domestic Product (at market prices)* Calendar Year (Rs million) 100,042 108,075 120,290 132,146 142,484 157,394 175,597 185,348 206,287 2 235,483 2

6. Gross National Income (at market prices)* Calendar Year (Rs million) 99,405 107,483 119,507 132,539 142,880 156,561 175,207 185,109 207,920 2 242,974 2

7. GNI Per Capita (at market prices)* Calendar Year (Rupees) 85,650 91,441 100,666 110,434 118,036 128,004 142,020 148,857 165,939 2 192,774 2

8. Inflation Rate* Fiscal Year ended June (Per cent) 5.4 7.9 5.3 4.4 6.3 5.1 3.9 5.6 5.1 10.7

9. Unemployment Rate* Year (Per cent) 6.9 7.7 6.5 6.8 7.2 7.7 8.4 9.6 9.1 8.5 3

10. Current Account Balance Fiscal Year ended June (Rs million) -2,615 -1,622 -1,451 +4,257 +7,458 +3,554 +1,383 -6,322 2 -10,188 2 -17,469 3

11 Overall Balance of Payments 6 Fiscal Year ended June (Rs million) -2,293 +690 +2,141 +5,107 +5,908 +9,099 +3,225 -3,133 -3,019 +6,603

12. Net International Reserves End-June (Rs million) 21,349 22,575 25,214 31,760 40,551 48,414 50,021 53,932 9 61,974 83,499 ^

13. Total Imports (c.i.f.)* Fiscal Year ended June (Rs million) 49,322 54,076 55,048 56,204 58,151 66,267 69,586 84,324 101,148 3 117,778 3

14. Total Exports (f.o.b.)* Fiscal Year ended June (Rs million) 36,279 41,702 38,845 45,222 47,938 53,247 54,203 57,857 68,959 3 72,755 3

15. Government Recurrent Revenue** Fiscal Year ended June (Rs million) 18,471 21,327 22,605 24,149 24,606 29,487 32,404 35,192 38,509 41,818 2

16. Government Recurrent Expenditure** Fiscal Year ended June (Rs million) 21,010 24,743 25,435 31,398 29,577 33,529 36,879 38,042 41,915 44,122 2

17. Ratio of Budget Deficit to GDP at market prices** Fiscal Year ended June (Per cent) -3.7 -3.6 -3.8 -6.7 -6.1 -6.2 -5.4 -5.0 -5.3 -4.3 2

18. External Debt: Central Government** 7 End-June (Rs million) 10,752 10,193 10,190 7,168 8,785 9,074 8,445 9,232 8,535 13,452

19. Internal Debt: Central Government End-June (Rs million) 34,619 40,819 46,641 53,394 67,095 86,413 85,002 96,584 104,829 108,668

20. Banking System Net Claims on Central Government 10 End-June (Rs million) 17,358 16,014 18,469 17,578 18,980 21,476 35,346 40,907 45,490 39,674

21. Banks' Claims on Private Sector (CPS) 10 End-June (Rs million) 49,941 60,106 67,271 74,016 79,976 85,080 93,120 102,069 119,471 131,381

22. Growth Rate of CPS 10 Fiscal Year ended June (Per cent) 32.3 20.4 11.9 10.0 8.1 6.4 9.4 9.6 13.7 10.0

23. Currency with Public 10 End-June (Rs million) 4,651 4,876 5,172 5,735 6,466 7,488 8,480 9,729 10,512 11,677

24. Money Supply (M1) 10 End-June (Rs million) 10,152 10,906 11,068 12,712 15,136 17,439 21,322 22,647 25,069 28,309

25. Aggregate Monetary Resources (M2) 10 End-June (Rs million) 70,878 80,204 88,938 97,753 110,467 123,405 141,132 153,128 177,527 193,610

26. Growth Rate of M2 10 Fiscal Year ended June (Per cent) 17.4 13.2 10.9 9.9 13.0 11.7 14.4 8.5 11.2 9.1

27. Total Private Sector Rupee Deposits with Banks 10 End-June (Rs million) 59,609 67,323 75,522 79,869 90,439 100,993 115,513 121,212 135,159 147,474

28. Broad Money Liabilities (BML) End-June (Rs million) 138,273 163,570 185,870 198,415 215,408

29. Growth Rate of BML Fiscal Year ended June (Per cent) 18.3 13.6 6.7 8.6

30. Claims on Other Sectors by Depository Corporations End-June (Rs million) 108,124 116,013 128,383 150,061 168,207

31. Growth Rate of Claims on Other Sectors

by Depository Corporations Fiscal Year ended June (Per cent) 7.3 10.7 16.9 12.1

1 Excluding Agalega and Saint Brandon. 2 Revised estimates. 3 Provisional.5 Population Census figure adjusted for under-enumeration of young children. 6 As from 2001-02, valuation changes are excluded from reserve assets transactions.7 As from end-June 1999, external debt includes Government Securities held by foreign investors.8 As from 2000, data on unemployment rate are not strictly comparable with the mid-year estimates published up to 1999. Data as from 2000 are derived from the Continuous Multi-Purpose Household Survey.9 Prior to June 2005, include the Net Foreign Assets of 11 former Category 1 banks. With effect from June 2005, include the Net Foreign Assets of banks, adjusted for transactions of Global Business Licence Holders. 10 Figures for June 2006 and June 2007 refer to 18 banks and are not strictly comparable with prior data. Note: As from 2002-03, data on imports and exports include transactions through the Mauritius Freeport.* Source: Central Statistics Office, Government of Mauritius. ** Source: Ministry of Finance and Economic Development. *** Source: Ministry of Tourism, Leisure and External Communications.^ Data for end-June 2007 are based on the methodology of the IMF’s Depository Corporation Survey framework. Data prior to 2007 is based on the previous manual ‘IMF Guide to Money and Banking Statistics 1984’.

Table 1: Selected Economic Indicators

Annual R

eport 2006-07

Statistical Tab

les

Period Unit 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

157

Table 2.1: Bank of Mauritius Claims on Government

Statistical Tab

lesA

nnual Rep

ort 2006-07

Figures may not add up to totals due to rounding.

(Rs million)

End of Month Government Treasury Advances TotalStocks Bills

2005 January 36.5 1,991.5 0.0 2,028.0February 37.5 1,631.1 0.0 1,668.6March 37.1 2,324.4 0.0 2,361.6April 37.0 2,272.5 0.0 2,309.5May 36.3 2,230.9 0.0 2,267.2June 35.8 3,091.4 0.0 3,127.2July 35.1 3,101.4 0.0 3,136.4August 36.6 3,877.8 0.0 3,914.4September 36.1 3,309.1 0.0 3,345.1October 36.4 3,457.3 0.0 3,493.7November 36.1 3,692.8 0.0 3,728.9December 38.0 3,663.9 0.0 3,701.9

2006 January 37.6 2,912.6 0.0 2,950.2February 36.9 2,871.3 0.0 2,908.1March 36.6 2,499.0 0.0 2,535.6April 36.4 2,541.4 0.0 2,577.8May 36.5 2,339.3 0.0 2,375.8June 36.4 3,819.7 0.0 3,856.1July 36.5 3,842.6 0.0 3,879.1August 36.6 3,530.5 0.0 3,567.2September 40.4 3,282.1 2,251.3 5,573.8October 40.8 3,156.6 0.0 3,197.4November 41.8 2,899.3 0.0 2,941.1December 44.2 1,919.6 4,998.2 6,962.0

2007 January 45.5 3,086.2 1,146.9 4,278.6February 45.1 3,050.6 0.0 3,095.6March 43.4 2,791.8 0.0 2,835.1April 44.4 1,675.6 0.0 1,720.0May 44.1 1,768.4 0.0 1,812.4June 43.1 576.7 0.0 619.8

158

Figures may not add up to totals due to rounding.

Table 2.2: Currency in Circulation(Rs million)

TOTALNOTES

ANDCOINS

Annual R

eport 2006-07

Statistical Tab

les

BANKNOTES COINSEndof

MonthRs5 Rs10 Rs20 Rs25 Rs50 Rs100 Rs200 Rs500 Rs1000 Rs2000 Total Rs10 Rs5 Re1 50c 25c 20c 10c 5c 2c 1c TotalDemone-

tizedCurrency

Notes

12,451.2 6.9 12.5 167.2 71.8 87.7 20.2 6.4 25.3 2.4 5.5 0.3 0.2 406.6 12,857.8

12,024.9 6.9 12.5 167.2 71.9 88.0 20.3 6.4 25.4 2.4 5.5 0.3 0.2 407.0 12,432.0

11,912.5 6.9 12.5 164.6 71.4 87.9 20.4 6.4 25.6 2.4 5.5 0.3 0.2 404.3 12,316.8

11,639.4 6.9 12.5 164.4 70.4 88.6 20.5 6.4 25.8 2.4 5.6 0.3 0.2 404.1 12,043.5

11,570.7 6.9 12.5 164.2 70.4 88.6 20.6 6.4 25.9 2.4 5.6 0.3 0.2 404.1 11,974.8

11,612.3 6.9 12.5 164.2 70.4 88.7 20.7 6.4 26.0 2.4 5.7 0.3 0.2 404.5 12,016.8

11,802.3 6.9 12.5 164.3 70.4 88.7 20.8 6.4 26.2 2.4 5.7 0.3 0.2 404.8 12,207.1

12,088.4 6.9 12.5 165.3 71.0 89.0 20.9 6.4 26.3 2.4 5.7 0.3 0.2 407.0 12,495.4

12,112.1 6.9 12.6 167.6 71.6 89.4 21.0 6.4 26.5 2.4 5.8 0.3 0.2 410.6 12,522.7

12,557.1 6.9 12.6 170.9 73.0 90.2 21.1 6.4 26.7 2.4 5.8 0.3 0.2 416.5 12,973.6

13,037.2 6.9 12.6 174.3 74.7 90.9 21.3 6.4 26.9 2.4 5.9 0.3 0.2 422.9 13,460.1

14,791.9 6.9 12.6 179.2 76.9 92.3 21.4 6.4 27.0 2.4 5.9 0.3 0.2 431.6 15,223.5

12,925.1 6.9 12.6 180.8 77.2 92.9 21.5 6.4 27.0 2.4 5.9 0.3 0.2 434.2 13,359.3

12,456.0 6.9 12.6 180.8 77.2 93.2 21.6 6.4 27.2 2.4 6.0 0.3 0.2 434.9 12,890.9

12,192.0 6.9 12.6 179.4 76.7 93.0 21.7 6.4 27.4 2.4 6.0 0.3 0.2 433.3 12,625.2

12,210.7 6.9 12.6 178.9 76.6 93.1 21.9 6.4 27.7 2.4 6.1 0.3 0.2 433.1 12,643.8

11,986.7 6.9 12.6 179.0 76.7 93.4 22.0 6.4 27.9 2.4 6.1 0.3 0.2 434.2 12,420.9

11,892.7 6.9 12.6 179.1 76.8 93.5 22.1 6.4 28.1 2.4 6.1 0.3 0.2 434.8 12,327.5

12,353.6 6.9 12.9 179.2 76.3 93.4 22.1 6.4 28.2 2.4 6.2 0.3 0.2 434.5 12,788.0

12,735.4 6.9 12.7 178.3 76.4 93.5 22.3 6.4 28.4 2.4 6.3 0.3 0.2 434.1 13,169.4

12,446.9 6.9 12.7 178.8 76.4 93.6 22.4 6.4 28.6 2.4 6.3 0.3 0.2 435.1 12,881.9

12,839.1 6.9 12.7 181.8 78.3 94.5 22.5 6.4 28.8 2.4 6.4 0.3 0.2 441.3 13,280.4

13,227.2 6.9 12.7 188.0 80.8 95.9 22.8 6.4 29.1 2.4 6.5 0.3 0.2 452.0 13,679.2

15,972.6 6.9 12.7 191.4 81.4 97.1 22.9 6.4 29.3 2.4 6.5 0.3 0.2 457.5 16,430.0

13,895.3 6.9 12.7 191.7 81.5 97.4 23.1 6.4 29.4 2.4 6.5 0.3 0.2 458.6 14,353.9

13,688.4 7.0 12.7 190.7 81.3 98.0 23.1 6.4 29.5 2.4 6.6 0.3 0.2 458.3 14,146.8

13,574.0 7.0 12.7 190.3 81.1 98.1 23.3 6.4 29.7 2.4 6.6 0.3 0.2 458.0 14,032.0

13,445.2 7.0 12.7 190.1 81.1 98.2 23.4 6.4 29.8 2.4 6.7 0.3 0.2 458.2 13,903.4

13,173.6 7.0 12.7 190.1 81.1 98.3 23.4 6.4 29.9 2.4 6.7 0.3 0.2 458.6 13,632.2

13,131.8 7.0 12.7 190.1 81.1 98.7 23.5 6.4 30.0 2.4 6.8 0.3 0.2 459.3 13,591.1

Comme-morative

Coins

GoldBullionCoins

2005 January 21.1 4.6 32.8 1.6 135.8 225.6 994.9 1,491.2 1,867.7 6,801.7 874.2

February 21.1 4.6 32.8 1.6 130.9 213.1 968.8 1,398.5 1,723.5 6,648.3 881.8

March 21.0 4.6 32.8 1.6 128.5 215.1 947.2 1,366.7 1,673.3 6,652.6 869.1

April 21.0 4.6 32.7 1.6 132.4 210.2 918.2 1,273.7 1,614.1 6,561.6 869.2

May 21.0 4.6 32.7 1.6 127.6 205.3 915.0 1,256.6 1,597.1 6,553.1 856.0

June 21.0 4.6 32.7 1.6 131.9 216.2 918.3 1,266.9 1,638.2 6,518.5 862.3

July 21.0 4.6 32.7 1.6 139.9 219.9 926.5 1,271.1 1,577.1 6,743.2 864.6

August 21.0 4.6 32.7 1.6 139.1 228.0 940.0 1,298.7 1,589.8 6,953.1 879.7

September 21.0 4.6 32.7 1.6 140.1 222.4 950.9 1,331.7 1,607.2 6,925.5 874.2

October 21.0 4.6 32.7 1.6 146.0 228.4 983.3 1,372.4 1,669.8 7,221.0 876.2

November 21.0 4.6 32.7 1.6 151.9 238.9 999.5 1,407.1 1,878.7 7,428.8 872.4

December 21.0 4.6 32.7 1.6 156.6 245.7 1,065.1 1,608.7 2,152.1 8,618.8 884.9

2006 January 21.0 4.6 32.7 1.6 149.7 233.7 922.3 1,259.6 1,780.6 7,655.8 863.6

February 21.0 4.6 32.6 1.6 143.5 224.1 900.6 1,188.6 1,694.2 7,391.4 853.6

March 21.0 4.6 32.6 1.6 141.1 221.3 902.3 1,198.3 1,599.7 7,226.6 842.8

April 21.0 4.6 32.6 1.6 138.6 218.1 898.3 1,215.2 1,595.5 7,257.1 827.9

May 21.0 4.6 32.6 1.6 140.2 217.9 889.0 1,181.4 1,562.3 7,111.5 824.5

June 21.0 4.6 32.6 1.6 138.9 215.5 871.5 1,163.1 1,544.7 7,076.8 822.5

July 21.0 4.6 32.6 1.6 140.1 216.8 885.1 1,200.0 1,599.9 7,428.5 823.3

August 21.0 4.6 32.6 1.6 141.1 217.2 894.9 1,173.2 1,652.0 7,775.6 821.5

September 21.0 4.6 32.6 1.6 142.1 222.8 872.3 1,149.7 1,668.7 7,514.5 816.9

October 21.0 4.6 32.5 1.6 145.9 228.5 902.3 1,193.7 1,707.8 7,794.2 807.0

November 21.0 4.6 32.5 1.6 148.4 233.2 906.9 1,236.6 1,754.7 8,082.4 805.1

December 21.0 4.6 32.5 1.6 158.1 245.5 1,036.4 1,455.9 2,211.0 9,999.7 806.2

2007 January 21.0 4.6 32.5 1.6 151.4 235.0 937.5 1,256.3 1,805.5 8,656.1 793.8

February 21.0 4.6 32.5 1.6 151.8 232.9 928.5 1,214.7 1,784.3 8,531.6 784.9

March 21.0 4.6 32.5 1.6 150.1 234.2 932.9 1,221.8 1,745.3 8,460.4 769.5

April 21.0 4.6 32.5 1.6 147.8 230.5 934.7 1,192.4 1,724.0 8,402.8 753.4

May 21.0 4.6 32.5 1.6 147.6 228.6 905.0 1,165.4 1,677.5 8,244.2 745.6

June 20.9 4.6 32.4 1.6 150.6 227.7 882.5 1,140.4 1,648.5 8,289.1 733.4

159

160

1 Include Claims on Public Corporations, State and Local Government. 2 Include Interbank Loans and Fixed Assets.Figures may not add up to totals due to rounding. 3 For a breakdown, see Table 2.3(b).* Based on the segmental reporting of assets and liabilities of banks.

Table 2.3(a): Banks * - Assets (Rs million)

Endof

Period

Acceptances,DocumentaryCredits and

Guarantees 3

TOTALASSETS

OTHERASSETS 2

CLAIMS ONGLOBAL

BUSINESSLICENCEHOLDERS

CLAIMS ON

BANKSIN

MAURITIUS

Investmentin Shares

andDebentures

TotalBillsReceivable

Loansand

Advances

Total LocalBills

Purchasedand

Discounted

AdvancesGovernmentSecurities

TreasuryBills

Foreignsecurities

ForeignNotesand

Coins

Loansoutside

Mauritius

Total ForeignBills

Discounted

Balanceswith Banks

Abroad

TotalBalanceswith

Bank ofMauritius

Bank ofMauritius

Bills

Cash inHand S

tatistical Tables

Annual R

eport 2006-07

RESERVES FOREIGN ASSETS CLAIMS ON PRIVATE SECTOR 1

2005 3,479.8 6,541.8 2,998.1

2006 3,322.2 8,087.3 753.2

2005 June 2,288.3 5,972.1 4,734.9

July 2,182.6 5,537.3 4,648.4

August 2,489.2 6,434.6 4,358.5

September 2,408.9 7,026.5 3,565.4

October 2,520.6 5,859.5 3,768.2

November 3,146.6 7,077.8 3,187.9

December 3,479.8 6,541.8 2,998.1

2006 January 2,461.3 7,203.3 2,232.5

February 2,252.1 8,092.2 2,505.0

March 2,081.6 8,270.0 2,682.1

Aprill 2,095.2 7,897.6 2,794.2

May 1,985.3 7,344.8 3,049.4

June 1,815.9 9,046.8 2,552.4

July 1,950.5 7,931.5 3,191.3

August 2,387.9 6,790.9 3,141.7

September 1,917.4 8,839.8 2,648.7

October 2,196.8 7,297.4 1,286.3

November 2,463.8 6,879.5 902.3

December 3,322.2 8,087.3 753.2

2007 January 2,515.3 7,414.5 676.6

February 2,414.9 7,832.2 612.6

March 2,208.3 8,904.4 2,105.5

Aprill 2,125.6 7,847.9 5,257.0

May 2,132.2 8,213.7 5,194.0

June 1,914.4 9,480.1 4,692.0

13,019.7 130,923.8 2,448.9 9,787.3 377.3 92,862.8 236,400.0 32,994.1 7,928.2 0.0 40,922.4 1,217.7 2,675.6 104,878.5 7,242.5 116,014.3 6,878.8 1,505.4 25,054.8 439,795.2 36,922.1

12,162.7 260,409.0 3,839.7 7,544.7 411.2 121,864.8 394,069.4 26,725.9 11,842.5 0.0 38,568.4 1,084.4 2,819.1 118,515.3 8,913.7 131,332.5 6,819.8 2,081.7 24,240.2 609,274.8 42,599.6

12,995.3 129,366.9 2,812.8 15,167.7 122.3 82,878.8 230,348.5 35,182.5 5,783.6 0.0 40,966.2 1,116.7 2,360.2 94,062.7 7,526.9 105,066.4 7,498.0 1,512.1 18,325.5 416,712.0 32,121.9

12,368.3 106,932.1 2,728.8 15,628.4 191.7 87,298.2 212,779.3 35,570.3 5,783.6 0.0 41,353.9 1,175.5 2,339.9 95,206.7 7,665.9 106,388.0 7,801.2 837.9 18,756.7 400,285.4 32,038.4

13,282.3 122,071.3 2,622.5 14,175.6 200.2 86,794.2 225,863.9 35,102.3 6,081.7 0.0 41,183.9 1,183.4 2,433.2 94,503.5 7,631.3 105,751.4 7,108.8 1,354.1 19,246.7 413,791.1 32,879.6

13,000.8 131,607.3 2,496.8 12,163.5 200.5 93,288.5 239,756.5 35,203.2 6,116.7 0.0 41,319.9 1,139.8 2,444.5 98,050.9 7,508.7 109,143.8 6,593.0 1,030.9 20,507.2 431,352.0 33,981.8

12,148.4 129,248.0 2,954.7 11,864.0 309.3 91,730.7 236,106.8 34,230.2 6,806.6 0.0 41,036.8 1,136.1 2,543.3 99,932.2 7,395.4 111,007.0 6,877.6 997.6 22,991.7 431,165.9 34,587.3

13,412.3 145,364.8 2,701.2 9,738.3 275.8 93,714.9 251,795.1 33,624.2 7,186.6 0.0 40,810.9 1,232.7 2,659.2 101,426.7 7,314.8 112,633.5 7,023.8 1,619.0 23,506.7 450,801.2 35,652.4

13,019.7 130,923.8 2,448.9 9,787.3 377.3 92,862.8 236,400.0 32,994.1 7,928.2 0.0 40,922.4 1,217.7 2,675.6 104,878.5 7,242.5 116,014.3 6,878.8 1,505.4 25,054.8 439,795.2 36,922.1

11,897.1 135,459.5 2,249.3 13,527.1 373.4 90,555.1 242,164.4 34,044.4 8,036.8 0.0 42,081.3 1,211.5 2,691.9 104,199.1 7,262.4 115,365.0 6,423.5 466.7 22,200.4 440,598.4 35,270.7

12,849.4 165,153.8 2,415.9 13,450.3 219.1 87,216.5 268,455.6 33,003.0 8,707.7 0.0 41,710.7 1,101.0 2,640.1 104,294.5 7,339.2 115,374.8 7,200.5 423.1 21,634.3 467,648.4 35,309.4

13,033.8 171,399.8 2,254.4 11,717.9 161.3 90,013.4 275,546.8 33,098.9 9,436.5 0.0 42,535.4 1,120.3 2,481.0 104,103.7 7,482.3 115,187.4 6,846.0 302.1 21,179.3 474,630.8 35,490.6

12,787.0 157,516.9 2,159.0 8,774.3 230.6 96,038.5 264,719.2 32,176.2 9,773.9 0.0 41,950.1 1,082.3 2,413.8 106,743.0 7,570.3 117,809.5 7,935.1 118.8 22,076.8 467,396.4 35,874.4

12,379.5 184,300.2 2,126.4 8,982.1 215.9 98,353.4 293,978.0 32,810.9 10,155.4 0.0 42,966.4 1,088.6 2,316.6 107,501.4 7,483.0 118,389.6 8,482.3 222.3 22,321.3 498,739.4 36,509.8

13,415.2 174,797.2 2,613.0 6,878.5 184.5 96,982.7 281,456.0 34,886.1 10,506.7 0.0 45,392.8 1,105.8 2,352.6 107,966.5 8,046.6 119,471.4 8,907.1 235.4 22,413.3 491,291.2 35,292.6

13,073.3 187,284.4 2,767.2 8,023.7 297.7 100,554.0 298,927.0 34,930.7 10,504.0 0.0 45,434.7 1,107.0 2,456.1 110,892.8 8,033.8 122,489.7 7,674.4 441.4 21,741.7 509,782.2 34,689.3

12,320.5 194,052.4 2,972.3 7,436.9 223.4 104,621.0 309,306.0 33,990.5 10,820.1 0.0 44,810.7 1,104.4 2,506.3 112,715.9 8,147.2 124,473.7 7,668.3 254.8 23,415.7 522,249.6 36,648.5

13,406.0 217,278.1 2,905.1 7,482.5 228.0 106,898.8 334,792.4 30,540.7 10,820.0 335.0 41,695.8 1,109.8 2,451.2 113,711.6 8,256.3 125,528.9 8,508.2 264.4 23,800.4 547,996.1 39,072.8

10,780.4 221,086.6 2,638.5 7,526.4 274.3 109,075.1 340,600.9 29,857.8 11,034.5 414.5 41,306.8 1,080.3 2,490.2 115,404.6 8,547.6 127,522.7 8,648.0 238.8 24,584.3 553,682.0 41,442.8

10,245.6 239,234.3 2,997.1 7,507.6 311.8 116,058.2 366,109.0 27,978.3 11,440.4 2,112.0 41,530.7 1,089.0 2,904.6 116,003.4 9,016.0 129,013.0 7,537.1 264.5 25,255.1 579,955.0 42,102.9

12,162.7 260,409.0 3,839.7 7,544.7 411.2 121,864.8 394,069.4 26,725.9 11,842.5 0.0 38,568.4 1,084.4 2,819.1 118,515.3 8,913.7 131,332.5 6,819.8 2,081.7 24,240.2 609,274.8 42,599.6

10,606.4 230,136.6 3,724.8 7,327.7 253.0 125,180.7 366,622.8 25,664.8 12,029.0 0.0 37,693.8 1,073.0 2,893.6 118,678.1 8,773.0 131,417.7 7,363.5 398.5 25,075.7 579,178.4 48,736.5

10,859.7 227,791.0 3,601.2 7,334.3 247.2 130,766.4 369,740.1 26,569.4 13,063.9 0.0 39,633.3 1,077.5 2,494.7 117,889.3 8,692.3 130,153.9 7,094.1 403.3 24,097.9 581,982.2 41,472.5

13,218.2 225,140.8 3,630.5 7,352.0 235.5 144,304.0 380,662.9 24,952.8 14,092.8 0.0 39,045.7 1,075.8 2,258.0 118,137.9 8,768.7 130,240.4 8,165.0 978.8 25,947.4 598,258.5 41,381.5

15,230.5 215,082.6 4,335.0 7,303.3 322.8 148,055.8 375,099.4 25,293.5 15,574.5 0.0 40,868.0 1,078.2 2,218.8 118,210.4 8,660.4 130,167.7 8,660.9 1,688.0 25,992.9 597,707.5 43,027.1

15,540.0 210,811.3 4,849.5 7,608.9 217.8 153,617.5 377,105.1 24,445.1 16,707.1 0.0 41,152.2 1,089.9 2,118.7 117,500.5 8,580.8 129,289.9 10,905.9 3,977.3 26,433.7 604,403.9 42,355.8

16,086.5 217,616.9 5,411.3 7,783.6 265.5 163,878.3 394,955.6 24,396.9 16,897.5 0.0 41,294.4 1,099.8 2,227.4 119,152.9 8,900.9 131,381.0 10,158.2 3,244.6 26,778.7 623,898.9 44,498.3

Claims on Budgetary Central Government

161

1 Include margin deposits. 2 As from September 2005, include bonds issued by one bank.Figures may not add up to totals due to rounding. 3 Include borrowings from other institutions (local and foreign).* Based on the segmental reporting of assets and liabilities of banks.

Table 2.3(b): Banks* - Liabilities(Rs million)

Endof

Period

GuaranteesDocumentaryCredits

Acceptanceson Account

of Customers

TOTALLIABILITIES

Annual R

eport 2006-07

Statistical Tab

les

PRIVATE SECTOR DEPOSITS BORROWINGS FROM OtherLiabilities 3

BillsPayable

BanksAbroad

Banksin

Mauritius

InterbankBorrowings

Borrowingsfrom

Bank ofMauritius

BudgetaryCentral

GovernmentDeposits

ForeignCurrencyDeposits

TotalTime 2Savings 1Demand

Capitaland

Reserves

34,574.4 14,110.5 67,501.4 47,244.5 174,181.7 303,038.1 1,010.2 1,437.3 1,987.5 1,076.5 64,852.6 166.1 31,652.4 439,795.2 928.4 7,948.1 28,045.6

38,264.3 15,094.6 72,630.5 52,007.6 299,459.6 439,192.3 1,942.5 922.4 1,535.7 1,710.8 85,821.3 188.9 39,696.6 609,274.8 1,037.0 14,817.3 26,745.3

33,314.3 12,541.5 64,689.8 46,947.7 185,530.6 309,709.6 294.1 176.1 1,824.9 535.0 44,451.9 233.8 26,172.3 416,712.0 1,386.6 7,129.6 23,605.8

35,655.8 12,524.1 64,700.6 43,475.4 172,578.7 293,278.8 439.5 256.7 1,965.4 543.6 43,598.2 197.6 24,349.9 400,285.4 1,212.9 6,586.8 24,238.6

34,807.9 12,270.8 65,173.6 44,538.8 174,702.3 296,685.6 444.0 207.5 2,024.9 767.9 47,846.5 187.3 30,819.5 413,791.1 618.4 7,438.0 24,823.2

34,679.3 13,133.1 65,814.8 45,604.1 168,539.1 293,091.1 471.7 498.2 1,941.9 376.6 70,186.6 299.4 29,807.1 431,352.0 831.6 8,289.9 24,860.2

34,949.9 13,178.0 65,220.6 46,809.5 169,555.6 294,763.7 410.9 637.7 1,919.2 345.6 68,994.1 188.4 28,956.2 431,165.9 827.5 7,338.4 26,421.4

34,569.8 13,508.1 65,724.9 48,167.2 187,200.1 314,600.3 574.1 797.5 1,909.2 979.7 64,551.4 171.9 32,647.3 450,801.2 856.7 7,216.3 27,579.4

34,574.4 14,110.5 67,501.4 47,244.5 174,181.7 303,038.1 1,010.2 1,437.3 1,987.5 1,076.5 64,852.6 166.1 31,652.4 439,795.2 928.4 7,948.1 28,045.6

36,924.4 13,983.1 68,332.6 47,491.8 176,916.8 306,724.4 503.0 2,070.1 1,888.4 158.3 60,758.5 183.8 31,387.6 440,598.4 1,077.9 6,275.4 27,917.4

36,627.1 12,790.4 70,087.7 48,122.9 203,186.0 334,186.9 497.7 1,036.4 1,878.3 123.6 61,300.7 237.2 31,760.6 467,648.4 1,099.9 6,848.2 27,361.3

36,958.4 12,805.8 69,688.9 49,522.2 205,318.7 337,335.6 666.2 1,191.6 1,783.6 119.7 64,140.5 180.4 32,254.8 474,630.8 844.1 7,712.3 26,934.2

37,789.1 12,339.2 69,908.2 48,888.4 191,542.7 322,678.5 675.7 1,506.7 1,766.0 115.4 69,075.3 171.3 33,618.5 467,396.4 859.5 8,681.3 26,333.6

36,328.5 12,456.6 69,281.6 49,475.6 208,623.0 339,836.8 608.9 920.9 1,776.5 111.4 83,185.6 146.5 35,824.2 498,739.4 759.5 9,110.8 26,639.5

35,945.7 14,240.4 70,504.2 50,414.4 208,440.6 343,599.6 841.1 1,393.3 1,680.9 107.0 73,413.9 268.3 34,041.5 491,291.2 884.2 9,224.5 25,183.9

38,856.7 13,651.9 70,665.5 51,500.7 217,617.1 353,435.1 1,017.5 789.4 1,663.2 103.8 80,259.3 184.8 33,472.4 509,782.2 811.9 9,500.8 24,376.6

39,538.9 14,606.2 71,360.1 52,029.2 222,634.0 360,629.5 763.3 1,007.1 2,103.0 103.3 83,111.5 185.9 34,807.0 522,249.6 909.1 11,204.9 24,534.5

38,415.7 14,755.3 70,865.4 52,258.2 246,474.2 384,353.2 576.5 1,542.9 1,645.2 99.1 82,272.7 409.6 38,681.2 547,996.1 784.9 13,396.5 24,891.3

39,183.2 13,763.3 70,353.8 52,952.4 247,893.8 384,963.2 1,942.4 1,525.4 1,544.2 99.2 85,273.9 181.8 38,968.7 553,682.0 948.1 14,847.0 25,647.7

39,628.3 14,530.9 70,805.0 52,101.0 272,561.7 409,998.7 1,735.3 1,552.3 1,541.1 90.3 83,848.8 195.2 41,365.1 579,955.0 920.7 14,385.1 26,797.1

38,264.3 15,094.6 72,630.5 52,007.6 299,459.6 439,192.3 1,942.5 922.4 1,535.7 1,710.8 85,821.3 188.9 39,696.6 609,274.8 1,037.0 14,817.3 26,745.3

41,237.9 14,926.7 72,075.3 52,383.7 273,912.3 413,297.9 495.6 2,034.7 1,439.6 84.2 82,434.1 394.7 37,759.7 579,178.4 894.8 20,719.9 27,121.8

39,361.6 15,969.8 73,475.1 52,703.9 275,346.5 417,495.4 1,432.4 596.0 1,437.5 87.5 82,689.3 202.7 38,679.9 581,982.2 634.2 13,048.9 27,789.5

39,093.3 15,971.9 73,118.2 54,628.4 283,611.9 427,330.3 1,260.3 1,166.9 1,435.2 72.0 87,663.1 194.8 40,042.8 598,258.5 669.0 13,823.2 26,889.2

40,016.1 16,421.8 73,037.4 54,999.4 282,141.3 426,599.9 1,177.0 1,435.8 1,340.0 856.3 86,063.9 172.4 40,046.1 597,707.5 616.8 14,862.4 27,547.9

39,592.1 17,439.2 72,496.8 55,883.9 275,617.6 421,437.6 2,068.8 570.2 1,340.0 3,166.4 92,525.7 198.0 43,505.2 604,403.9 1,571.0 12,298.9 28,486.0

39,761.5 16,218.7 75,083.6 56,171.3 286,940.2 434,413.8 740.7 1,095.6 1,337.5 2,388.9 101,448.2 179.2 42,533.5 623,898.9 754.1 14,636.0 29,108.2

2005

2006

2005 June

July

August

September

October

November

December

2006 January

February

March

April

May

June

July

August

September

October

November

December

2007 January

February

March

April

May

June

162

Table 2.4: Principal Interest Rates


(As on the last day of the month) (Per cent)


I. LENDING

Bank of Mauritius

Lombard Rate* 13.00 13.00

Bank Rate 10.02 12.45 11.35 10.98

Repo Rate** 8.50 8.50 8.50

Banks

A. Prime Lending Rate 10.70-11.75 10.70-11.75 10.70-11.75 10.70-11.75

B. Sectoral Rates

1. Agriculture & Fishing 7.50-22.00 7.50-21.00 7.50-21.00 7.50-21.00of which: Sugar Industry 7.50-19.25 7.50-19.25 7.50-19.25 7.50-21.00

2. Manufacturing 8.25-21.25 8.25-21.90 8.25-21.75 8.25-23.70of which: Export Enterprise Certificate Holders 10.70-20.75 10.70-19.75 10.70-21.65 10.70-21.00

3. Tourism 8.25-21.16 8.25-23.70 8.25-21.75 8.25-21.75of which: Hotels 8.25-21.16 8.25-21.75 8.15-21.09 8.15-21.00

4. Transport 8.00-21.75 8.00-21.75 8.00-21.76 8.00-21.77

5. Construction 6.25-21.00 6.25-22.00 6.25-22.00 6.25-22.00of which: Housing 8.00-21.00 8.00-21.00 8.00-19.75 8.00-19.75

6. Traders 7.75-24.00 7.75-24.00 8.00-24.00 8.00-22.00

7. Information Communication and Technology 10.50-21.15 9.38-21.75 10.75-21.00 10.75-21.88

8. Financial and Business Services 7.00-22.00 7.00-21.00 7.00-21.00 7.00-21.75

9. Infrastructure 8.88-19.75 8.88-19.75 8.88-19.75 8.88-19.92

10. Global Business Licence Holders 14.75-21.00 11.00-21.00 11.00-16.75 11.00-16.75

11. State and Local Government 9.25-19.75 9.25-19.75 9.25-21.00 9.25-21.00

12. Public Nonfinancial Corporations 8.25-21.00 8.25-21.00 10.50-21.00 10.50-21.00

13. Freeport Enterprise Certificate Holders 9.00-15.25 9.00-15.25 9.00-15.50 9.00-19.75

14. Health Development Certificate Holders 9.75-21.00 9.75-21.00 9.75-21.00 9.75-21.00

15. Modernisation and Expansion Enterprise Cert. Holders 12.50-18.00 18.00 12.50-18.00 18.00

16. Personal 8.00-21.00 8.00-21.00 8.00-21.00 8.00-21.00

17. Professional 8.00-21.00 8.00-21.00 8.00-21.00 8.00-21.00

18. Human Resource Development Certificate Holders

19. Education 7.97-18.00 8.67-21.00 8.67-21.00 8.67-21.00

20. Media, Entertainment and Recreational Activities 7.00-21.00 7.00-19.75 10.50-19.75 10.50-21.00

21. Other Customers 10.00-22.50 10.00-24.00 10.00-24.00 10.00-24.00

II. DEPOSITS

1. Savings 7.20-7.60 7.20-7.60 7.20-7.60 7.20-7.60

2. Time

Call 7.00-7.50 7.00-7.50 7.00-7.50 7.00-8.00

7 Days' Notice 6.25-10.25 6.50-10.25 6.50-10.50 7.00-10.25

Exceeding 7 Days & Up to 1 Month 6.25-9.50 7.20-10.90 7.20-12.95 7.20-12.00

Exceeding 1 Month & Up to 3 Months 6.25-10.80 7.20-11.55 7.25-12.60 7.20-11.50

Exceeding 3 Months & Up to 6 Months 6.50-9.30 7.35-11.90 4.63-12.50 4.63-11.00








Exceeding 60 Months 7.75-12.00 8.75-14.50 8.00-16.50 8.00-15.60

* The Lombard Rate has been abolished on 18 December 2006.** Effective 18 December 2006, the key Repo Rate is used as the key policy rate and has been set at 8.50% per anum.

163

Up to Rs500,000 174,852 2,710,673 108,668 13,099,382 1,281 40,001 39,471 954,328 1,402 308,696 0 0 325,674 17,113,079

Over Rs500,000 and

Up to Rs1,000,000 1,470 1,031,126 8,724 6,219,757 83 57,867 10 7,423 477 333,929 0 0 10,764 7,650,102

Over Rs1,000,000 and

Up to Rs2,000,000 960 1,366,413 3,818 5,421,037 91 129,065 23 36,240 283 401,721 0 0 5,175 7,354,476


Up to Rs5,000,000 790 2,489,515 1,773 5,451,201 135 431,147 19 59,865 149 446,446 0 0 2,866 8,878,174


Up to Rs10,000,000 359 2,513,795 493 3,493,717 89 614,618 1 6,809 37 265,506 0 0 979 6,894,445


Up to Rs25,000,000 248 3,825,764 351 5,615,353 72 1,171,009 3 35,100 19 309,911 0 0 693 10,957,137


Up to Rs50,000,000 135 4,921,787 199 7,135,270 54 1,805,626 0 0 5 164,887 0 0 393 14,027,570

Over Rs 50,000,000 and

Up to Rs100,000,000 59 4,322,545 111 7,998,810 44 3,139,529 0 0 0 0 0 0 214 15,460,884

Over Rs 100,000,000 and

Up to Rs150,000,000 18 2,265,889 40 5,143,853 15 1,975,116 0 0 0 0 0 0 73 9,384,858

Over Rs 150,000,000 and

Up to Rs200,000,000 8 1,340,980 21 3,810,423 9 1,597,653 0 0 0 0 0 0 38 6,749,056

Over Rs 200,000,000 and

Up to Rs300,000,000 3 705,950 21 5,196,892 14 3,546,387 0 0 0 0 0 0 38 9,449,229

Exceeding Rs300,000,000 6 2,552,582 13 7,014,371 18 9,152,306 0 0 0 0 0 0 37 18,719,259

TOTAL 178,908 30,047,019 124,232 75,600,066 1,905 23,660,324 39,527 1,099,765 2,372 2,231,096 0 0 346,944 132,638,269

RANGE OVERDRAFTS LOANS LOANS AND OTHER LOCAL BILLS BILLS RECEIVABLE ADV. AGAINSTFINANCING IN DISCOUNTED PLEDGE OF

FOREIGN CURRENCIES EXPORT BILLS TOTAL

Note: Include Claims on Holders of Global Business Licence.

Table 2.5: Value Range of Banks' "Overdrafts", "Loans", "Loans and Other Financing in Foreign Currencies,"Local Bills Discounted","Bills Receivable" and "Advances Against Pledge of Export Bills": June 2007

Annual R

eport 2006-07

Statistical Tab

les

No. of Amount No. of Amount No. of Amount No. of Amount No. of Amount No. of Amount No. of AmountAccounts (Rs'000) Accounts (Rs'000) Accounts (Rs'000) Accounts (Rs'000) Accounts (Rs'000) Accounts (Rs'000) Accounts (Rs'000)

164

SECTORS OVERDRAFTS LOANS LOANS & OTHER LOCAL BILLS BILLS RECEIVABLE ADVANCES AGAINST TOTALFINANCING IN DISCOUNTED PLEDGE OF

FOREIGN CURRENCIES EXPORT BILLS

Table 2.6: Ownership of Banks' "Overdrafts", "Loans", "Loans and Other Financing in Foreign Currencies", "Local Bills Discounted","Bills Receivable" and "Advances Against Pledge of Export Bills": June 2007

Statistical Tab

lesA

nnual Rep

ort 2006-07

No. of Amount No. of Amount No. of Amount No. of Amount No. of Amount No. of Amount No. of AmountAccounts (Rs'000) Accounts (Rs'000) Accounts (Rs'000) Accounts (Rs'000) Accounts (Rs'000) Accounts (Rs'000) Accounts (Rs'000)

Agriculture & Fishing 544 2,358,466 1,040 3,414,221 36 871,542 17 460 14 6,657 0 0 1,651 6,651,349Manufacturing 2,275 6,237,647 1,593 4,506,516 397 2,373,203 61 49,357 705 864,363 0 0 5,031 14,031,085Tourism 657 1,537,543 567 11,767,483 73 3,804,461 1 16 1 387 0 0 1,299 17,109,890Transport 444 355,918 1,033 903,572 14 430,341 0 0 16 17,747 0 0 1,507 1,707,579Construction 757 2,813,334 40,679 19,583,929 26 447,603 420 42,450 16 10,333 0 0 41,898 22,897,648Traders 6,902 7,950,426 4,435 9,581,800 342 960,273 131 68,714 1,383 1,175,211 0 0 13,193 19,736,423Information, communication

and Technology 212 187,159 109 358,364 28 52,153 0 0 4 1,553 0 0 353 599,229Financial and

Business Services 389 2,488,996 272 7,481,225 74 1,621,072 4 1,234 4 2,408 0 0 743 11,594,934Infrastructure 29 47,811 45 3,672,133 3 20,396 0 0 5 2,009 0 0 82 3,742,350Global Business Licence Holders 28 20,448 0 0 197 10,134,063 0 0 6 3,651 0 0 231 10,158,161State and Local Government 4 36 4 95,104 0 0 0 0 0 0 0 0 8 95,141Public Nonfinancial

Corporations 26 650,265 82 2,718,202 26 1,372,068 0 0 1 188 0 0 135 4,740,722Regional Development

Certificate Holders 0 0 0 0 0 0 0 0 0 0 0 0 0 0Freeport Enterprise

Certificate Holders 63 57,824 18 51,102 60 201,455 0 0 19 9,846 0 0 160 320,226Regional Headquarters

Certificate Holders 0 0 1 500 0 0 0 0 0 0 0 0 1 500Health Development Certificate

Holders 8 4,052 13 60,371 0 0 0 0 0 0 0 0 21 64,422Modernisation & Expansion

Enterprise Cert Holders 1 102 0 0 0 0 0 0 0 0 0 0 1 102Personal 164,716 3,314,756 72,829 9,030,613 535 370,853 38,865 935,197 92 31,816 0 0 277,037 13,683,235Professional 395 266,172 186 295,378 15 7,169 3 39 50 59,351 0 0 649 628,108Education 63 32,757 604 327,420 2 12 0 0 0 0 0 0 669 360,189Human Resource Development

Certificate Holders 0 0 1 64 0 0 0 0 0 0 0 0 1 64Media, Entertainment &

Recreational Activities 129 110,393 55 253,590 2 9 0 0 17 12,713 0 0 203 376,704Other 1,266 1,612,914 666 1,498,479 75 993,651 25 2,298 39 32,863 0 0 2,071 4,140,208

TOTAL 178,908 30,047,019 124,232 75,600,066 1,905 23,660,324 39,527 1,099,765 2,372 2,231,096 0 0 346,944 132,638,269

165

Table 2.7: Ownership of Banks' Deposits *: June 2007

Demand Deposits Saving Deposits Time Deposits Foreign Currency Deposits

Annual R

eport 2006-07

Statistical Tab

les

Agriculture & Fishing 1,345 518,264 1,502 224,252 244 553,058 119 393,666

Manufacturing 3,577 1,035,271 1,137 455,294 456 521,004 1,130 3,613,143

Tourism 1,291 895,836 361 167,334 107 885,417 463 2,072,263

Transport 918 282,441 659 92,512 127 183,097 131 187,165

Construction 1,606 841,013 526 224,704 189 499,331 190 747,355

Traders 11,351 1,885,162 4,160 1,036,388 1,357 1,121,509 1,476 2,795,288

Information Communication and Technology 646 120,441 139 250,394 38 278,524 211 693,838

Financial and Business Services 1,808 2,024,578 448 1,590,121 617 4,135,759 965 6,335,753

Infrastructure 329 331,469 1,244 238,447 105 453,361 28 107,629

Global Business Licence Holders 76 30,735 7 344 8 654 10,538 159,585,302

State and Local Government 16 33,138 13 11,358 20 157,921 0 0

Public Nonfinancial Corporations 104 633,629 123 1,828,764 118 7,805,917 188 6,681,491

Regional Development Certificate Holders 3 163 4 11,196 1 725 0 0

Freeport Enterprise Certificate Holders 116 19,761 10 276 7 1,943 189 421,857

Regional Headquarters Certificate Holders 1 50 2 61,295 0 0 0 0

Health Development Certificate Holders 22 41,874 27 4,643 1 100 4 7,494

Modernisation & Expansion Enterprise Certificate Holders 3 68 5 623 0 0 0 0

Personal 78,554 3,913,379 1,617,261 62,261,778 96,739 33,806,742 18,473 9,910,374

Professional 1,137 257,913 988 190,396 212 304,460 171 195,568

Human Resource Development Certificate Holders 0 0 3 140 0 0 0 0

Media, Entertainment and Recreational Activities 355 46,891 605 34,424 28 21,904 43 52,589

Education 360 129,734 311 92,763 45 137,870 17 19,401

Other ** 9,190 3,082,498 21,690 4,534,333 2,511 2,942,441 1,959 4,987,547

TOTAL 112,808 16,124,308 1,651,225 73,311,779 102,930 53,811,737 36,295 198,807,723

* include all deposits mobilised from residents and Global Business Licence Holders.. ** include deposits of Budgetary Central Government.

No. of Amount No. of Amount No. of Amount No. of AmountAccounts (Rs’ 000) Accounts (Rs’ 000) Accounts (Rs’ 000) Accounts (Rs’ 000)

Sectors

166

Up to Rs500,000 108,421 3,918,727 1,626,692 41,528,510 84,971 14,296,875 357 18,576 24,926 2,613,779

Over Rs500,000 and Up to Rs1,000,000 2,129 1,494,627 16,807 11,388,768 11,022 8,483,483 1 908 3,351 2,394,283

Over Rs1,000,000 and Up to Rs2,000,000 1,144 1,604,063 5,790 7,763,167 4,748 6,832,848 3 5,396 2,635 3,784,670

Over Rs2,000,000 and Up to Rs5,000,000 692 2,104,679 1,490 4,327,714 1,468 4,631,017 1 3,604 2,359 7,548,728

Over Rs5,000,000 and Up to Rs10,000,000 253 1,751,764 251 1,717,394 411 3,011,191 0 0 1,149 8,259,212

Over Rs10,000,000 and Up to Rs25,000,000 106 1,648,221 131 1,946,649 187 2,934,622 0 0 874 13,938,948

Over Rs25,000,000 and Up to Rs50,000,000 39 1,287,261 38 1,295,799 68 2,640,555 0 0 414 14,785,396

Over Rs 50,000,000 and Up to Rs 100,000,000 18 1,126,942 18 1,293,514 23 1,822,526 0 0 268 18,950,523

Over Rs 100,000,000 and Up to Rs 150,000,000 2 226,644 5 637,080 11 1,470,779 0 0 95 11,791,336

Over Rs 150,000,000 and Up to Rs 200,000,000 0 0 0 0 7 1,282,322 0 0 69 12,019,442

Over Rs 200,000,000 and Up to Rs 300,000,000 4 961,380 1 253,605 6 1,428,144 0 0 49 12,222,499

Exceeding Rs 300,000,000 0 0 2 1,159,579 8 4,977,375 0 0 106 90,498,907

TOTAL 112,808 16,124,308 1,651,225 73,311,779 102,930 53,811,737 362 28,484 36,295 198,807,723

* Include all deposits mobilised from residents and Global Business Licence Holders.

Table 2.8: Value Range of Banks' Deposits*: June 2007

Statistical Tab

lesA

nnual Rep

ort 2006-07

RANGE Demand Deposits Savings Deposits Time Deposits Margin Deposits Foreign CurrencyDeposits

No. of Amount No. of Amount No. of Amount No. of Amount No. of AmountAccounts (Rs’ 000) Accounts (Rs’ 000) Accounts (Rs’ 000) Accounts (Rs’ 000) Accounts (Rs’ 000)

167

7 Days' Notice 6,640,942,799 124,863,742 6,765,806,540 909,932,429 291,069,000 1,201,001,429 7,966,807,970 3,396,368,050 1,841,823,888 5,238,191,938 53,882,742,143 3,856,270,174 57,739,012,317 62,977,204,255

Exceeding 7 Days

and Up to 1 Month 451,786,408 100,673,021 552,459,429 872,814,194 152,454,872 1,025,269,066 1,577,728,493 3,063,213,057 2,294,724,307 5,357,937,365 17,799,069,810 27,587,981,210 45,387,051,020 50,744,988,384

Exceeding 1 Month

and Up to 3 Months 1,114,058,623 64,623,630 1,178,682,253 2,996,298,417 8,012,000 3,004,310,417 4,182,992,669 1,810,049,703 1,736,828,174 3,546,877,876 12,282,087,695 10,160,287,477 22,442,375,174 25,989,253,051

Exceeding 3 Months

and Up to 6 Months 1,461,132,292 81,081,875 1,542,214,166 1,863,328,918 0 1,863,328,918 3,405,543,084 4,916,469,773 565,922,817 5,482,392,589 4,343,436,821 2,161,224,340 6,504,661,162 11,987,053,751

Exceeding 6 Months

and Up to 12 Months 6,590,890,339 340,652,367 6,931,542,706 4,515,559,823 11,118,960 4,526,678,783 11,458,221,489 1,380,145,436 889,563,261 2,269,708,697 5,512,263,455 19,683,765,260 25,196,028,715 27,465,737,412

Exceeding 12 Months

and Up to 18 Months 1,666,923,616 80,057,491 1,746,981,107 491,552,772 181,867 491,734,639 2,238,715,746 541,836,510 84,005,649 625,842,159 199,671,375 3,112,500 202,783,875 828,626,034

Exceeding 18 Months

and Up to 24 Months 3,854,209,328 258,367,410 4,112,576,738 637,670,227 0 637,670,227 4,750,246,965 1,347,143,231 91,730,383 1,438,873,614 665,365,033 52,690,236 718,055,270 2,156,928,884

Exceeding 24 Months

and Up to 36 Months 3,576,667,685 179,619,165 3,756,286,850 1,015,675,328 0 1,015,675,328 4,771,962,178 795,217 0 795,217 1,674,571,400 30 1,674,571,430 1,675,366,647

Exceeding 36 Months

and Up to 48 Months 3,192,346,265 157,892,939 3,350,239,204 694,548,684 0 694,548,684 4,044,787,888 504,955,183 141,168,296 646,123,479 172,925,912 0 172,925,912 819,049,391

Exceeding 48 Months

and Up to 60 Months 8,962,054,588 475,510,477 9,437,565,065 897,642,900 0 897,642,900 10,335,207,965 137,868,437 72,582,399 210,450,836 78,659,956 0 78,659,956 289,110,792

Exceeding 60 Months 1,395,458,315 12,064,543 1,407,522,858 11,429,883 35,000,000 46,429,883 1,453,952,742 0 0 0 0 6,746,989,994 6,746,989,994 6,746,989,994

TOTAL 38,906,470,256 1,875,406,659 40,781,876,915 14,906,453,575 497,836,699 15,404,290,274 56,186,167,190 17,098,844,597 7,718,349,174 24,817,193,771 96,610,793,602 70,252,321,221 166,863,114,823 191,680,308,594

* Include deposits mobilised from residents, Global Business Licence Holders and non-residents.Note: Figures rounded to the nearest Rupee.

Table 2.9: Maturity Pattern of Banks' Time Deposits *: June 2007

Annual R

eport 2006-07

Statistical Tab

les

Duration Rupee Deposits Rupee Equivalent of Deposits Denominated in Foreign Currencies

Personal/Professional Institutional Total Personal/Professional Institutional Total

Resident Non-Resident Total Resident Non-Resident Total Resident Non-Resident Total Resident Non-Resident Total

168

Table 2.10: Maturity Pattern of Banks' Foreign Currency Deposits 1: June 2007

Statistical Tab

lesA

nnual Rep

ort 2006-07

1 Include deposits mobilised from residents, Global Business Licence Holders and non-residents. 2 include Margin deposits.Note: Figures rounded to the nearest Rupee.

US Pound Euro South African Other TotalDollar Sterling Rand

1. DEMAND 70,319,165,725 4,177,360,552 10,271,836,205 1,940,992,900 1,868,357,075 88,577,712,457

2. SAVINGS 2 4,328,083,851 782,198,154 1,522,450,225 7,195,764 43,452,955 6,683,380,949

3. TIME 147,256,186,348 21,722,158,301 15,688,068,673 3,063,003,208 3,950,892,064 191,680,308,594

7 Days' Notice 49,154,049,594 6,706,745,010 6,541,922,153 205,583,536 368,903,962 62,977,204,255

Exceeding 7 Days and Up to 1 Month 39,579,801,429 4,638,334,851 3,707,234,536 2,412,237,750 407,379,818 50,744,988,384

Exceeding 1 Month and Up to 3 Months 21,351,549,990 1,785,866,218 2,116,191,562 227,759,518 507,885,763 25,989,253,051

Exceeding 3 Months and Up to 6 Months 7,871,969,877 2,948,567,051 722,296,216 9,083,219 435,137,387 11,987,053,751

Exceeding 6 Months and Up to 12 Months 22,176,106,754 3,000,708,455 1,096,523,407 6,755,141 1,185,643,654 27,465,737,412

Exceeding 12 Months and Up to 18 Months 106,511,248 537,632,731 124,349,829 0 60,132,227 828,626,034

Exceeding 18 Months and Up to 24 Months 98,152,999 1,013,579,476 59,387,156 0 985,809,253 2,156,928,884

Exceeding 24 Months and Up to 36 Months 0 580,528,828 1,094,837,819 0 0 1,675,366,647

Exceeding 36 Months and Up to 48 Months 243,619,947 349,313,163 161,363,607 64,752,674 0 819,049,391

Exceeding 48 Months and Up to 60 Months 122,439,799 102,708,605 63,962,388 0 0 289,110,792

Exceeding 60 Months 6,551,984,711 58,173,913 0 136,831,371 0 6,746,989,994

TOTAL 221,903,435,924 26,681,717,007 27,482,355,103 5,011,191,872 5,862,702,094 286,941,402,000

Duration RUPEE EQUIVALENT OF DEPOSITS DENOMINATED IN FOREIGN CURRENCIES

(Rupees)

169

Net Foreign Assets 42,314.6 43,158.5 44,059.5 42,890.6 41,713.8 43,552.4 44,006.7 42,514.7 44,527.2 46,962.5 50,203.5 49,459.9 52,222.7Claims on Nonresidents 42,458.6 43,305.9 44,191.4 43,015.2 41,841.2 43,684.6 44,127.1 42,647.4 44,716.3 47,337.5 50,735.7 49,991.8 52,772.1less: Liabilities to Nonresidents 144.0 147.5 132.0 124.6 127.4 132.2 120.4 132.7 189.1 375.0 532.2 531.9 549.4

Claims on Other DepositoryCorporations 1,838.5 1,702.3 2,152.2 1,713.8 1,594.0 1,586.2 1,568.8 1,621.6 1,462.0 1,472.9 1,385.3 1,378.5 1,714.0

Net Claims on Budgetary CentralGovernment 1,011.2 989.2 831.7 2,929.7 1,990.8 1,658.0 6,116.1 3,398.0 2,285.6 1,332.4 406.3 434.4 -1,417.3

Claims on budgetary centralgovernment 3,869.0 3,892.0 3,580.0 5,586.7 3,210.9 2,954.7 6,974.4 4,292.6 3,109.7 2,849.2 1,733.9 1,826.2 633.3

less: Liabilities to budgetary centralgovernment 2,857.8 2,902.8 2,748.3 2,657.0 1,220.2 1,296.7 858.3 894.7 824.1 1,516.8 1,327.5 1,391.9 2,050.6

Claims on Other Sectors 244.1 229.6 223.6 241.7 236.4 250.7 181.8 201.2 256.6 248.7 227.7 225.4 238.1

Monetary Base 22,015.3 21,197.4 20,481.6 22,248.6 21,064.5 21,100.0 25,101.6 22,294.4 22,508.9 23,523.4 22,483.1 22,498.9 23,840.9Currency in circulation 12,248.1 12,708.6 13,090.0 12,802.5 13,201.0 13,599.8 16,350.6 14,274.5 14,067.3 13,952.6 13,824.0 13,552.8 13,511.8Liabilities to Other Depository

Corporations 9,047.7 7,933.0 6,791.8 8,847.1 7,301.2 6,889.4 8,131.7 7,417.1 7,833.0 8,906.8 7,846.5 8,213.0 9,480.3Deposits included in Broad Money 719.5 555.7 599.8 598.9 562.4 610.8 619.2 602.8 608.6 664.1 812.6 733.1 848.7

Transferable deposits 435.7 323.2 354.9 347.6 365.1 390.9 397.8 395.6 408.3 465.7 586.0 542.2 643.4Savings deposits 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Time deposits 283.8 232.5 244.9 251.3 197.3 219.9 221.4 207.2 200.3 198.4 226.6 190.9 205.3

Securities other than Shares,Included in Broad Money 1,416.3 1,316.2 1,327.6 896.0 358.6 262.1 249.8 252.7 84.9 448.2 860.3 861.7 647.9

Deposits Excluded from Broad Money 62.4 62.4 62.4 62.4 62.4 62.4 62.4 62.4 1,506.9 62.4 62.4 62.4 62.4

Securities Other than Shares,Excluded from Broad Money 2,737.1 3,403.7 3,363.3 2,843.5 1,378.2 953.6 800.9 729.2 647.7 2,223.1 5,425.8 5,399.5 4,871.3

Loans 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Financial Derivatives 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Trade Credit and Advances 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Shares and Other Equity 20,247.2 21,258.2 23,149.9 22,919.5 23,814.8 25,755.3 26,696.0 25,244.4 24,764.8 24,629.6 24,135.9 23,392.1 24,606.2

Other Items (net) -1,069.9 -1,158.3 -1,117.8 -1,194.2 -1,143.5 -1,086.1 -1,037.4 -847.6 -981.8 -870.2 -744.8 -716.3 -1,271.3

Figures may not add up to totals due to rounding.1 The Central Bank Survey(CBS) is derived from the sectoral balance sheet of the Bank of Mauritius. The CBS contains data on all components of the monetary base, which comprises the central bank liabilities underlying the monetary aggregates of the economy.

The monetary base comprises all bank notes and coins in circulation and deposits of banks, non-bank deposit taking institutions and other non-depository corporations with the Bank of Mauritius.

Table 2.11: Central Bank Survey 1

(Rs million)

Annual R

eport 2006-07

Statistical Tab

les

Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07

170

Net Foreign Assets 2 21,887.6 23,184.8 26,207.9 28,703.4 29,879.0 32,984.9 34,049.1 35,347.0 36,925.4 33,441.6 29,624.3 28,872.7 30,938.9Claims on nonresidents 202,668.5 201,939.2 212,700.8 228,915.9 235,378.1 255,618.0 252,589.0 240,568.9 251,600.4 253,806.5 259,560.6 253,039.6 267,222.7less: Liabilities to nonresidents 180,780.9 178,754.4 186,492.9 200,212.6 205,499.1 222,633.2 218,539.8 205,221.8 214,675.0 220,365.0 229,936.3 224,166.9 236,283.9

Claims on Central Bank 13,580.9 13,258.8 12,514.2 13,617.9 10,867.9 10,327.9 12,207.8 10,653.3 12,329.6 13,267.1 15,361.7 15,692.2 16,206.2Currency 1,816.0 1,950.6 2,388.0 1,917.6 2,197.0 2,489.4 3,322.3 2,515.5 2,415.1 2,208.5 2,125.7 2,132.4 1,914.5Reserve deposits 9,047.1 7,931.7 6,791.1 8,840.1 7,297.6 6,879.7 8,087.6 7,414.7 7,832.4 8,904.6 7,848.1 8,214.0 9,480.4Other claims 2,717.8 3,376.5 3,335.1 2,860.2 1,373.3 958.7 797.9 723.1 2,082.1 2,154.0 5,387.9 5,345.8 4,811.4

Net Claims on Central Government 47,533.1 47,510.0 47,321.9 43,984.4 42,244.4 40,950.8 39,852.6 40,442.2 39,768.1 41,487.4 43,133.4 42,532.4 43,652.8Claims on central government 48,603.6 48,757.8 48,318.1 44,796.4 44,421.1 42,919.7 42,019.7 41,159.5 41,423.6 42,973.5 44,536.5 44,829.0 44,612.1less: Liabilities to central government 1,070.5 1,247.9 996.3 811.9 2,176.8 1,968.9 2,167.2 717.3 1,655.5 1,486.1 1,403.1 2,296.6 959.3

Claims on Other Sectors 149,817.2 153,880.4 156,317.4 156,762.6 156,078.5 163,191.8 159,994.6 161,379.0 160,636.1 160,559.3 162,654.1 163,408.9 167,969.2

Claims on Global BusinessLicence Holders Sector 8,907.1 7,674.4 7,668.3 8,508.2 8,648.0 7,537.1 6,819.8 7,363.5 7,094.1 8,165.0 8,660.9 10,905.9 10,158.2

Liabilities to Central Bank 1,700.2 1,688.3 2,136.7 1,680.5 1,570.0 1,573.6 1,571.0 1,463.6 1,467.4 1,468.3 1,362.5 1,368.3 1,368.5

Deposits Included in Broad Money 184,816.9 186,069.7 188,743.7 188,641.4 187,919.2 189,751.4 192,523.9 192,973.9 197,611.4 197,216.1 197,784.8 199,028.8 201,121.8Transferable Deposits 35,499.2 35,021.6 36,725.4 36,902.1 35,963.3 37,224.7 39,250.4 39,279.8 40,191.4 40,331.9 41,248.5 39,885.6 41,505.2Savings Deposits 60,930.7 61,452.0 62,476.2 62,380.0 61,831.3 63,052.0 63,479.9 63,328.4 63,992.3 64,074.0 63,975.4 64,255.8 65,344.0Time Deposits 88,386.9 89,596.1 89,542.2 89,359.3 90,124.5 89,474.7 89,793.6 90,365.7 93,427.7 92,810.2 92,560.9 94,887.5 94,272.6

Securities other than Shares,Included in Broad Money 1,030.0 1,039.3 1,054.6 1,064.7 1,076.2 1,088.9 1,101.5 1,114.4 1,127.1 1,141.7 1,158.4 1,173.9 1,192.1

Deposits Excluded from Broad Money 3 105,278.5 113,854.2 113,064.1 126,248.1 126,481.6 131,171.6 160,496.6 144,741.4 138,177.3 149,987.7 143,500.4 146,787.8 159,585.3

Securities other than Shares,Excluded from Broad Money 916.8 916.1 894.7 962.7 785.9 786.2 847.9 1,022.7 676.6 657.6 687.4 739.3 646.4

Loans 473.3 644.6 786.9 746.2 740.7 742.2 742.1 754.3 694.5 693.2 688.2 686.5 496.7

Financial Derivatives 8,036.8 6,008.9 5,777.0 8,064.4 4,943.3 8,758.9 5,280.8 6,796.4 6,663.9 6,820.9 8,521.7 8,443.0 11,560.8


Shares and Other Equity 43,673.3 45,224.5 46,849.7 46,283.4 48,014.7 49,483.7 48,476.3 49,806.5 46,843.7 47,095.5 47,922.0 48,748.7 49,701.9

Other Items (net) -104,199.9 -109,937.2 -109,277.8 -122,115.0 -123,813.9 -128,364.1 -158,116.2 -143,488.3 -136,508.5 -148,160.6 -142,191.0 -145,564.0 -156,748.2

Figures may not add up to totals due to rounding.1 The Other Depository Corporations (ODC) covers all institutional units,i.e Banks and non-bank deposit taking institutions that issue liabilities included in the national definition of broad money. The Other Depository Corporation Survey (ODCS) is derived from the sectoral balance

sheets of Other Depository Corporations.2 Adjusted for transactions for Global Business Licence Holders.3 Include Deposits of Global Business Licence Holders.

Table 2.12: Other Depository Corporations Survey 1

(Rs million)

Statistical Tab

lesA

nnual Rep

ort 2006-07

Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07

171

Net Foreign Assets 2 64,202.2 66,343.3 70,267.4 71,594.0 71,592.8 76,537.3 78,055.8 77,861.8 81,452.7 80,404.1 79,827.8 78,332.6 83,161.6

Claims on Nonresidents 245,127.1 245,245.1 256,892.2 271,931.1 277,219.3 299,302.7 296,716.0 283,216.3 296,316.7 301,144.0 310,296.3 303,031.4 319,994.8

Central Bank 42,458.6 43,305.9 44,191.4 43,015.2 41,841.2 43,684.6 44,127.1 42,647.4 44,716.3 47,337.5 50,735.7 49,991.8 52,772.1

Other Depository Corporations 202,668.5 201,939.2 212,700.8 228,915.9 235,378.1 255,618.0 252,589.0 240,568.9 251,600.4 253,806.5 259,560.6 253,039.6 267,222.7

less: Liabilities to Nonresidents 180,924.9 178,901.9 186,624.8 200,337.1 205,626.6 222,765.4 218,660.2 205,354.5 214,864.1 220,739.9 230,468.5 224,698.8 236,833.3

Central Bank 144.0 147.5 132.0 124.6 127.4 132.2 120.4 132.7 189.1 375.0 532.2 531.9 549.4


Domestic Claims 198,605.6 202,609.2 204,694.7 203,918.4 200,550.0 206,051.3 206,145.1 205,420.4 202,946.5 203,627.9 206,421.6 206,601.1 210,442.8

Net Claims on Central Government 48,544.2 48,499.2 48,153.6 46,914.1 44,235.1 42,608.8 45,968.7 43,840.2 42,053.7 42,819.8 43,539.8 42,966.8 42,235.5

Claims on Central Government 52,472.6 52,649.9 51,898.2 50,383.0 47,632.0 45,874.4 48,994.1 45,452.1 44,533.3 45,822.7 46,270.4 46,655.2 45,245.4

Central Bank 3,869.0 3,892.0 3,580.0 5,586.7 3,210.9 2,954.7 6,974.4 4,292.6 3,109.7 2,849.2 1,733.9 1,826.2 633.3


less: Liabilities to Central Government 3,928.4 4,150.7 3,744.6 3,468.9 3,396.9 3,265.6 3,025.5 1,611.9 2,479.6 3,002.9 2,730.6 3,688.4 3,009.9

Central Bank 2,857.8 2,902.8 2,748.3 2,657.0 1,220.2 1,296.7 858.3 894.7 824.1 1,516.8 1,327.5 1,391.9 2,050.6

Other Depository Corporations 1,070.5 1,247.9 996.3 811.9 2,176.8 1,968.9 2,167.2 717.3 1,655.5 1,486.1 1,403.1 2,296.6 959.3

Claims on Other Sectors 150,061.4 154,110.0 156,541.1 157,004.3 156,314.9 163,442.5 160,176.4 161,580.2 160,892.8 160,808.1 162,881.8 163,634.3 168,207.3

Central Bank 244.1 229.6 223.6 241.7 236.4 250.7 181.8 201.2 256.6 248.7 227.7 225.4 238.1


Claims on Global Business Licence

Holders Sector 8,907.1 7,674.4 7,668.3 8,508.2 8,648.0 7,537.1 6,819.8 7,363.5 7,094.1 8,165.0 8,660.9 10,905.9 10,158.2

Central Bank 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Depository Corporations 8,907.1 7,674.4 7,668.3 8,508.2 8,648.0 7,537.1 6,819.8 7,363.5 7,094.1 8,165.0 8,660.9 10,905.9 10,158.2

TOTAL ASSETS 271,714.9 276,626.9 282,630.3 284,020.5 280,790.8 290,125.7 291,020.7 290,645.6 291,493.2 292,197.0 294,910.3 295,839.6 303,762.5

Table 2.13: Depository Corporations Survey 1

(Rs million)

Annual R

eport 2006-07

Statistical Tab

les

Assets Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07

Continued on next page

172

Broad Money Liabilities 198,414.7 199,738.9 202,427.7 202,085.9 200,920.3 202,823.5 207,522.7 206,702.8 211,084.2 211,214.1 212,314.4 213,217.9 215,407.8Currency Outside Depository

Corporations 10,432.0 10,758.0 10,702.0 10,884.9 11,004.0 11,110.4 13,028.3 11,759.0 11,652.3 11,744.1 11,698.3 11,420.5 11,597.3

Transferable Deposits 35,935.0 35,344.8 37,080.3 37,249.8 36,328.4 37,615.5 39,648.2 39,675.4 40,599.8 40,797.6 41,834.5 40,427.8 42,148.6Central Bank 435.7 323.2 354.9 347.6 365.1 390.9 397.8 395.6 408.3 465.7 586.0 542.2 643.4Other Depository Corporations 35,499.2 35,021.6 36,725.4 36,902.1 35,963.3 37,224.7 39,250.4 39,279.8 40,191.4 40,331.9 41,248.5 39,885.6 41,505.2

Savings Deposits 60,930.7 61,452.0 62,476.2 62,380.0 61,831.3 63,052.0 63,479.9 63,328.4 63,992.3 64,074.0 63,975.4 64,255.8 65,344.0Central Bank 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Other Depository Corporations 60,930.7 61,452.0 62,476.2 62,380.0 61,831.3 63,052.0 63,479.9 63,328.4 63,992.3 64,074.0 63,975.4 64,255.8 65,344.0

Time Deposits 88,670.7 89,828.6 89,787.0 89,610.6 90,321.8 89,694.6 90,015.0 90,572.9 93,627.9 93,008.6 92,787.5 95,078.3 94,478.0Central Bank 283.8 232.5 244.9 251.3 197.3 219.9 221.4 207.2 200.3 198.4 226.6 190.9 205.3Other Depository Corporations 88,386.9 89,596.1 89,542.2 89,359.3 90,124.5 89,474.7 89,793.6 90,365.7 93,427.7 92,810.2 92,560.9 94,887.5 94,272.6

Securities other than Shares,Included in Broad Money 2,446.3 2,355.5 2,382.2 1,960.6 1,434.8 1,351.0 1,351.3 1,367.1 1,212.0 1,589.9 2,018.7 2,035.6 1,840.0

Central Bank 1,416.3 1,316.2 1,327.6 896.0 358.6 262.1 249.8 252.7 84.9 448.2 860.3 861.7 647.9Other Depository Corporations 1,030.0 1,039.3 1,054.6 1,064.7 1,076.2 1,088.9 1,101.5 1,114.4 1,127.1 1,141.7 1,158.4 1,173.9 1,192.1

Deposits Excluded from Broad Money 3 105,341.0 113,916.6 113,126.6 126,310.5 126,544.0 131,234.0 160,559.0 144,803.8 138,239.7 150,050.1 143,562.8 146,850.2 159,647.7Central Bank 62.4 62.4 62.4 62.4 62.4 62.4 62.4 62.4 62.4 62.4 62.4 62.4 62.4Other Depository Corporations 105,278.5 113,854.2 113,064.1 126,248.1 126,481.6 131,171.6 160,496.6 144,741.4 138,177.3 149,987.7 143,500.4 146,787.8 159,585.3

Securities Other than Shares,Excluded from Broad Money 917.8 917.1 895.7 963.7 786.9 787.2 848.9 1,023.7 677.6 658.5 688.4 740.2 647.4

Central Bank 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0Other Depository Corporations 916.8 916.1 894.7 962.7 785.9 786.2 847.9 1,022.7 676.6 657.6 687.4 739.3 646.4

Loans 473.3 644.6 786.9 746.2 740.7 742.2 742.1 754.3 694.5 693.2 688.2 686.5 496.7Central Bank 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Other Depository Corporations 473.3 644.6 786.9 746.2 740.7 742.2 742.1 754.3 694.5 693.2 688.2 686.5 496.7

Financial Derivatives 8,036.8 6,008.9 5,777.0 8,064.4 4,943.3 8,758.9 5,280.8 6,796.4 6,663.9 6,820.9 8,521.7 8,443.0 11,560.8Central Bank 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Other Depository Corporations 8,036.8 6,008.9 5,777.0 8,064.4 4,943.3 8,758.9 5,280.8 6,796.4 6,663.9 6,820.9 8,521.7 8,443.0 11,560.8


Shares and Other Equity 63,920.5 66,482.7 69,999.7 69,202.9 71,829.4 75,239.0 75,172.3 75,051.0 71,608.5 71,725.1 72,057.9 72,140.7 74,308.2Central Bank 20,247.2 21,258.2 23,149.9 22,919.5 23,814.8 25,755.3 26,696.0 25,244.4 24,764.8 24,629.6 24,135.9 23,392.1 24,606.2Other Depository Corporations 43,673.3 45,224.5 46,849.7 46,283.4 48,014.7 49,483.7 48,476.3 49,806.5 46,843.7 47,095.5 47,922.0 48,748.7 49,701.9

Other Items (net) -105,389.2 -111,081.9 -110,383.2 -123,353.1 -124,973.9 -129,459.1 -159,105.2 -144,486.4 -137,475.2 -148,965.0 -142,923.0 -146,238.9 -158,306.0

TOTAL LIABILITIES 271,714.9 276,626.9 282,630.3 284,020.5 280,790.8 290,125.7 291,020.7 290,645.6 291,493.2 292,197.0 294,910.3 295,839.6 303,762.5

Figures may not add up to totals due to rounding.1 The Depository Corporations Survey covers the accounts of the depository corporations and is a consolidation of the Central Bank Survey and the Other Depository Corporations Survey. 2 Adjusted for transactions for Global Business Licence Holders.3 Include Deposits of Global Business Licence Holders.

Table 2.13: Depository Corporations Survey 1 (continued)(Rs million)

Statistical Tab

lesA

nnual Rep

ort 2006-07

Liabilities Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07

173

A1 Monetary Gold and SDRs 1,889.9 1,924.8 1,879.6 1,847.8 1,868.6 1,998.6 2,020.2 1,978.3 1,996.1 1,960.4 1,941.7 1,883.8 1,897.1

A2 Currency and Deposits 26,753.4 27,349.6 27,662.8 26,440.8 26,489.2 27,752.2 27,768.2 26,842.3 29,158.7 31,852.5 35,365.9 34,834.8 37,953.4

A2.1 Currency 0.0 0.3 1.3 0.7 0.8 0.1 0.0 0.1 0.1 0.1 0.1 0.1 0.1

A2.2 Transferable deposits 1,865.8 1,642.1 937.3 1,127.8 1,578.2 1,756.1 2,437.4 2,838.3 5,293.6 6,228.2 10,547.6 10,006.1 11,140.5

A2.3 Savings deposits 24,887.6 25,707.2 26,724.2 25,312.3 24,910.3 25,996.0 25,330.7 24,004.0 23,864.9 25,624.1 24,818.2 24,828.6 26,812.8

A2.4 Time deposits 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

A3 Securities other than Shares 17,539.5 17,790.2 18,138.3 17,965.8 16,602.0 16,816.6 16,132.5 16,927.2 16,626.3 16,323.7 14,989.1 14,948.6 13,412.1

A4 Loans 1,911.7 1,909.5 2,356.7 4,150.4 1,792.8 1,795.2 6,730.5 2,760.4 1,610.5 1,608.9 1,508.3 1,513.0 1,519.6

A5 Shares and Other Equity 131.9 120.5 77.9 83.3 78.8 58.4 168.0 31.3 30.9 36.1 159.0 137.0 129.4

A6 Insurance Technical Reserves 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

A7 Financial Derivatives 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

A8 Other Accounts Receivable 267.6 118.2 99.7 130.0 112.2 134.7 112.9 303.5 202.4 208.1 200.2 107.9 450.0

A9 Nonfinancial Assets 1,480.4 1,499.3 1,534.2 1,708.9 1,725.1 1,728.0 1,768.4 1,805.6 1,876.3 1,876.9 1,878.5 1,968.8 1,960.0

TOTAL ASSETS 49,974.5 50,712.1 51,749.1 52,327.0 48,668.8 50,283.6 54,700.6 50,648.6 51,501.1 53,866.4 56,042.8 55,394.0 57,321.5

Figures may not add up to totals due to rounding.* The sectoral balance sheet contains the stock and flow data for all categories of assets and liabilities of the Bank of Mauriitus, based on the concepts and principles of the IMF Monetary and Financial Statistics Manual.

Table 2.14(a): Sectoral Balance Sheet of the Bank of Mauritius * - Assets(Rs million)

Annual R

eport 2006-07

Statistical Tab

les

Code Assets Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07

L1 Currency in Circulation 12,248.1 12,708.6 13,090.0 12,802.5 13,201.0 13,599.8 16,350.6 14,274.0 14,067.3 13,952.6 13,824.0 13,552.8 13,511.8

L2 Deposits Included in

Broad Money 719.5 555.7 599.8 598.9 562.4 610.8 619.2 602.8 608.6 664.1 812.6 733.1 848.7

L2.1 Transferable deposits 435.7 323.2 354.9 347.6 365.1 390.9 397.8 395.6 408.3 465.7 586.0 542.2 643.4

L2.2 Savings deposits 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

L2.3 Time deposits 283.8 232.5 244.9 251.3 197.3 219.9 221.4 207.2 200.3 198.4 226.6 190.9 205.3

L3 Deposits Excuded from

Broad Money 11,975.2 10,925.8 9,629.7 11,594.0 8,622.8 8,277.7 9,082.1 8,396.5 8,741.8 10,514.1 9,239.7 9,668.6 11,595.7

L3.1 Transferable deposits 11,912.7 10,863.3 9,567.2 11,531.5 8,560.4 8,215.3 9,019.7 8,334.1 8,679.4 10,451.7 9,177.3 9,606.2 11,533.3


L3.3 Time deposits 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

L4 Securities Other than Shares,

Included in Broad Money 1,416.3 1,316.2 1,327.6 896.0 358.6 262.1 249.8 252.7 84.9 448.2 860.3 861.7 647.9


Excluded from Broad Money 2,769.0 3,435.6 3,390.8 2,845.3 1,378.2 953.6 800.9 729.2 647.7 2,409.4 5,815.2 5,791.9 5,267.0

L6 Loans 64.9 64.9 64.9 64.9 64.9 64.9 60.5 60.5 1,505.0 60.5 60.5 60.5 56.0

L7 Insurance Technical Reserves 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

L8 Financial Derivatives 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

L9 Other Accounts Payable 534.3 447.1 496.5 605.9 666.2 759.4 841.4 1,088.6 1,080.9 1,188.0 1,294.6 1,333.3 788.2

L10 Shares and Other Equity 20,247.2 21,258.2 23,149.9 22,919.5 23,814.8 25,755.3 26,696.0 25,244.4 24,764.8 24,629.6 24,135.9 23,392.1 24,606.2


Figures may not add up to totals due to rounding.* The sectoral balance sheet contains the stock and flow data for all categories of assets and liabilities of the Bank of Mauriitus, based on the concepts and principles of the IMF Monetary and Financial Statistics Manual.

Table 2.14(b): Sectoral Balance Sheet of the Bank of Mauritius * - Liabilities(Rs million)

Statistical Tab

lesA

nnual Rep

ort 2006-07

Code Liabilities Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07

174

A1 Monetary Gold and SDRs 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0


A2.1 Currency 2,000.6 2,248.3 2,611.4 2,145.5 2,471.3 2,775.8 3,733.5 2,768.5 2,662.3 2,444.0 2,448.5 2,350.2 2,180.0

A2.2 Transferable deposits 30,343.2 73,088.6 20,138.3 24,953.7 24,222.4 79,514.6 90,611.0 85,868.1 86,225.3 87,306.7 73,307.1 75,156.7 85,896.1

A2.3 Savings deposits 404.1 670.9 351.8 361.0 419.1 407.1 253.8 398.9 422.6 344.3 327.5 345.7 415.8

A2.4 Time deposits 156,993.6 125,212.9 184,275.4 204,918.9 208,107.5 170,340.8 183,848.0 156,236.7 153,132.2 151,311.6 154,791.8 151,327.3 147,922.5


A4 Loans 224,723.7 229,838.2 235,868.8 240,171.8 244,440.7 252,325.2 257,409.2 262,165.7 267,493.5 281,565.7 286,015.2 293,370.5 304,210.7

A5 Shares and Other Equity 7,148.2 7,908.9 8,262.2 8,439.9 8,876.6 9,159.1 9,227.6 8,978.9 8,949.7 9,163.2 9,007.8 9,274.5 9,830.2


A7 Financial Derivatives 30,702.9 24,608.5 23,590.5 26,051.6 23,754.5 26,204.7 20,675.0 22,950.2 23,418.5 25,423.4 29,513.9 23,818.4 34,451.7

A8 Other Accounts Receivable 9,073.5 5,899.5 6,416.6 8,286.6 8,298.7 8,975.7 8,215.2 7,728.3 8,629.2 9,340.7 12,456.0 13,814.3 14,568.7


TOTAL ASSETS 553,754.7 563,618.7 575,394.0 605,259.1 608,440.1 637,096.6 661,145.9 633,159.2 636,947.8 655,844.1 662,667.2 664,628.0 695,845.1

Figures may not add up to totals due to rounding.* Other Depository Corporations consist of Banks holding a Banking Licence and institutions other than banks which are licensed to transact deposit-taking business in Mauritius.

Table 2.15(a): Sectoral Balance Sheet of Other Depository Corporations * - Assets(Rs million)

Annual R

eport 2006-07

Statistical Tab

les


175

176

L1 Currency in Circulation 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

L2 Deposits Included in Broad Money 288,151.8 297,918.8 299,555.1 312,892.8 312,515.9 319,055.8 351,509.2 336,198.9 334,056.9 345,204.2 339,100.0 343,243.5 358,543.1


L2.2 Savings deposits 60,695.8 61,009.7 61,732.9 61,868.3 61,522.2 62,711.7 63,729.5 64,056.7 63,638.6 65,376.1 65,259.1 64,221.9 66,095.5

L2.3 Time deposits 157,085.2 159,074.6 162,342.7 175,308.6 174,492.5 173,027.0 192,996.4 174,334.6 167,876.8 174,890.3 171,081.2 180,865.5 184,349.0

L3 Deposits Excluded from

Broad Money 77,230.9 78,255.4 83,007.1 93,373.8 96,481.8 114,964.9 111,645.2 99,942.5 106,620.4 105,632.6 111,745.3 103,575.8 99,741.8



L3.3 Time deposits 63,554.9 63,112.5 64,316.8 78,380.0 83,041.6 100,612.3 94,316.5 84,097.2 87,752.1 82,111.2 93,528.9 83,690.3 83,687.0


Included in Broad Money 1,030.0 1,039.3 1,054.6 1,064.7 1,076.2 1,088.9 1,101.5 1,114.4 1,127.1 1,141.7 1,158.4 1,173.9 1,192.1


Excluded from Broad Money 15,643.6 15,910.2 16,604.7 16,569.8 16,688.4 17,479.2 16,595.0 16,716.5 16,465.2 16,478.7 16,614.8 16,325.5 16,380.6

L6 Loans 73,897.5 80,482.1 84,050.3 83,508.3 86,283.7 84,335.8 87,801.6 84,138.1 83,924.3 89,536.7 88,898.6 97,270.4 105,709.3


L8 Financial Derivatives 34,322.5 23,458.4 22,783.9 28,642.7 25,554.2 28,986.7 23,144.5 24,778.6 25,578.8 28,469.2 35,207.9 29,022.9 39,967.9

L9 Other Accounts Payable 19,805.1 21,329.9 21,488.6 22,923.6 21,825.2 21,701.8 20,872.5 20,463.5 22,331.4 22,285.4 22,020.2 25,267.3 24,608.3



Figures may not add up to totals due to rounding.* Other Depository Corporations consist of Banks holding a Banking Licence and institutions other than banks which are licensed to transact deposit-taking business in Mauritius.

Table 2.15(b): Sectoral Balance Sheet of Other Depository Corporations * - Liabilities(Rs million)

Statistical Tab

lesA

nnual Rep

ort 2006-07


177



A2.1 Currency 2,000.4 2,248.2 2,611.2 2,145.4 2,471.2 2,775.7 3,733.4 2,768.3 2,662.1 2,443.9 2,448.4 2,350.1 2,179.8

A2.2 Transferable deposits 29,961.8 72,762.3 19,813.5 24,781.9 23,970.8 79,364.9 90,373.5 85,467.7 85,963.1 87,001.7 73,024.2 74,868.3 85,554.1


A2.4 Time deposits 155,440.7 123,667.9 182,708.1 203,351.4 206,573.1 168,730.8 182,170.8 154,767.5 151,652.5 149,661.9 153,170.7 149,729.6 146,286.7


A4 Loans 201,150.5 206,000.1 211,691.5 215,911.0 220,003.5 227,909.0 232,633.7 237,287.7 242,373.0 256,451.2 260,758.9 267,888.7 278,542.7

A5 Shares and Other Equity 7,050.0 7,811.0 8,162.8 8,339.9 8,775.1 9,056.0 9,113.3 8,864.1 8,837.0 9,047.0 8,892.6 9,159.7 9,714.2


A7 Financial Derivatives 30,702.9 24,608.5 23,590.5 26,051.6 23,754.5 26,204.7 20,675.0 22,950.2 23,418.5 25,423.4 29,513.9 23,818.4 34,451.7

A8 Other Accounts Receivable 8,382.3 5,165.2 5,723.1 7,552.0 7,663.7 8,255.5 7,438.2 6,960.6 7,857.1 8,484.5 11,531.0 12,922.3 13,641.6


TOTAL ASSETS 523,850.3 533,426.3 544,859.5 574,613.8 577,716.9 606,514.0 630,119.8 601,954.2 605,511.0 624,077.8 630,561.2 632,246.8 663,094.4

Figures may not add up to totals due to rounding.* The sectoral balance sheet contains the stock and flow data for all categories of assets and liabilities of Banks, based on the concepts and principles of the IMF Monetary and Financial Statistics Manual.

Table 2.16(a): Sectoral Balance Sheet of Banks * - Assets(Rs million)

Annual R

eport 2006-07

Statistical Tab

les


178


L2 Deposits Included in

Broad Money 268,854.6 278,782.7 280,471.4 293,880.8 293,445.6 300,335.3 332,611.5 317,224.2 315,181.6 326,094.4 319,702.5 323,621.1 338,937.6



L2.3 Time deposits 138,896.7 141,057.0 144,365.0 157,397.6 156,528.7 155,431.3 175,228.3 156,521.1 150,156.8 156,901.1 152,796.6 162,375.7 165,863.5


Broad Money 76,667.1 77,688.0 82,385.9 92,749.9 95,817.0 114,289.3 110,903.4 99,207.2 105,754.7 104,827.5 110,934.9 102,759.8 98,923.1



L3.3 Time deposits 62,991.1 62,545.0 63,695.6 77,806.8 82,426.8 99,987.2 94,049.3 83,832.0 87,358.4 81,832.3 93,247.3 83,406.3 83,401.8


Included in Broad Money 674.3 678.7 682.8 687.3 691.7 696.0 700.4 705.2 709.6 713.6 718.3 722.7 727.4


Excluded from Broad Money 15,298.7 15,557.9 16,249.5 16,221.7 16,375.5 17,146.9 16,288.0 16,407.1 16,153.6 16,168.2 16,324.5 16,038.0 16,109.6

L6 Loans 70,567.2 76,711.9 79,979.5 79,406.0 82,165.9 80,242.8 83,540.8 79,696.4 79,567.5 85,069.4 84,447.1 92,817.0 101,010.9


L8 Financial Derivatives 34,322.5 23,458.4 22,783.9 28,642.7 25,554.2 28,986.7 23,144.5 24,778.6 25,578.8 28,469.2 35,207.9 29,022.9 39,967.9




Figures may not add up to totals due to rounding.* The sectoral balance sheet contains the stock and flow data for all categories of assets and liabilities of Banks, based on the concepts and principles of the IMF Monetary and Financial Statistics Manual.

Table 2.16(b): Sectoral Balance Sheet of Banks * - Liabilities(Rs million)

Statistical Tab

lesA

nnual Rep

ort 2006-07


179



A2.1 Currency 0.1 0.1 0.1 0.1 0.1 0.2 0.1 0.1 0.1 0.1 0.1 0.1 0.1

A2.2 Transferable deposits 381.4 326.3 324.8 171.7 251.6 149.7 237.5 400.4 262.2 305.0 282.9 288.5 341.9


A2.4 Time deposits 1,553.0 1,545.1 1,567.2 1,567.5 1,534.4 1,610.0 1,677.2 1,469.2 1,479.6 1,649.8 1,621.1 1,597.7 1,635.7


A4 Loans 23,573.2 23,838.1 24,177.2 24,260.8 24,437.1 24,416.2 24,775.5 24,877.9 25,120.5 25,114.5 25,256.3 25,481.8 25,668.0

A5 Shares and Other Equity 98.2 97.9 99.4 99.9 101.4 103.1 114.3 114.8 112.7 116.2 115.1 114.8 116.0


A7 Financial Derivatives 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

A8 Other Accounts Receivable 691.2 734.3 693.5 734.6 635.0 720.3 777.1 767.7 772.1 856.2 925.0 892.0 927.1


TOTAL ASSETS 29,904.4 30,192.4 30,534.5 30,645.3 30,723.1 30,582.7 31,026.1 31,205.0 31,436.8 31,766.2 32,106.0 32,381.2 32,750.7

Figures may not add up to totals due to rounding.* The sectoral balance sheet contains the stock and flow data for all categories of assets and liabilities of the Non-Bank Deposit Taking Institutions, based on the concepts and principles of the IMF Monetary and Financial Statistics Manual.

Table 2.17(a): Sectoral Balance Sheet of Non-Bank Deposit-Taking Institutions* - Assets(Rs million)

Annual R

eport 2006-07

Statistical Tab

les


180


L2 Deposits Included in Broad Money 19,297.3 19,136.1 19,083.7 19,012.1 19,070.3 18,720.5 18,897.8 18,974.7 18,875.3 19,109.8 19,397.5 19,622.5 19,605.4



L2.3 Time deposits 18,188.6 18,017.6 17,977.6 17,911.0 17,963.9 17,595.7 17,768.1 17,813.4 17,719.9 17,989.2 18,284.6 18,489.8 18,485.6


Broad Money 563.8 567.5 621.2 623.9 664.9 675.5 741.9 735.4 865.8 805.1 810.4 816.0 818.7



L3.3 Time deposits 563.8 567.5 621.2 573.2 614.8 625.1 267.1 265.3 393.7 278.9 281.6 284.0 285.2


Included in Broad Money 355.7 360.6 371.9 377.4 384.6 392.8 401.1 409.3 417.5 428.1 440.1 451.1 464.7


Excluded from Broad Money 345.0 352.3 355.2 348.1 312.9 332.3 307.0 309.4 311.7 310.6 290.3 287.5 271.0

L6 Loans 3,330.3 3,770.2 4,070.7 4,102.3 4,117.8 4,092.9 4,260.7 4,441.7 4,356.8 4,467.3 4,451.6 4,453.4 4,698.4


L8 Financial Derivatives 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0




Figures may not add up to totals due to rounding.* The sectoral balance sheet contains the stock and flow data for all categories of assets and liabilities of the Non-Bank Deposit Taking Institutions, based on the concepts and principles of the IMF Monetary and Financial Statistics Manual.

Table 2.17(b): Sectoral Balance Sheet of Non-Bank Deposit-Taking Institutions * - Liabilities(Rs million)

Statistical Tab

lesA

nnual Rep

ort 2006-07


181

Table 2.18: Cheque Clearances

Annual R

eport 2006-07

Statistical Tab

les

Daily Average

Number of Amount Number of Number of AmountCheques (Rs ’000) Days Cheques (Rs ’000)

2005 January 371,508 12,777,719 19 19,553 672,512 February 387,450 14,822,347 18 21,525 823,464 March 431,387 14,506,987 20 1 21,558 725,228 April 420,322 14,794,050 21 20,015 704,479 May 456,496 15,098,777 22 20,750 686,308 June 440,302 15,662,152 22 20,014 711,916 July 430,522 15,436,409 21 20,501 735,067 August 461,262 15,799,768 23 20,055 686,946 September 433,512 16,297,517 21 20,643 776,072 October 456,504 17,204,923 21 21,738 819,282 November 437,853 15,295,120 19 23,045 805,006 December 517,651 19,673,266 22 23,530 894,239

2006 January 415,257 15,089,958 21 19,774 718,569 February 393,028 15,556,794 19 20,686 818,779 March 440,973 15,512,484 22 20,044 705,113 April 407,807 14,854,989 20 20,390 742,749 May 465,729 16,211,566 22 21,170 736,889 June 440,302 16,544,426 22 20,014 752,019 July 439,834 16,863,937 21 20,944 803,045 August 429,785 16,294,314 21 20,466 775,920 September 421,650 17,104,810 21 20,079 814,515 October 455,243 19,217,504 21 21,678 915,119 November 451,305 17,925,915 21 21,491 853,615 December 479,019 20,631,281 20 23,951 1,031,564

2007 January 437,741 17,539,887 21 20,845 835,233 February 367,348 16,776,704 18 20,408 932,039 March 426,744 16,885,412 20 21,337 844,271 April 431,502 17,141,597 21 20,548 816,267 May 457,204 18,282,014 22 20,782 831,001 June 427,464 18,099,615 21 20,355 861,886

1 Our Rodrigues branch worked for 21 days, including 24 March 2005 when there was a cyclone warning Class 3 in Mauritius.

182

Table 2.19: Electronic Banking Transactions

Statistical Tab

lesA

nnual Rep

ort 2006-07

1 Involve the use of credit cards, debit cards, ATMs and merchant points of sale.

Number of Value of Credit Debit Cards TotalTransactions Transactions 1 Cards and

(Rs million)Others

2005 October 311 2,993,094 5,026 189,346 758,062 947,408 990.5

November 310 2,878,566 4,895 189,523 764,697 954,220 1,007.3

December 313 3,698,436 6,991 190,677 772,049 962,726 1,038.7

2006 January 319 2,999,569 5,143 189,689 779,513 969,202 1,014.4

February 319 2,655,614 4,295 189,703 781,817 971,520 1,011.9

March 319 2,967,336 4,736 190,203 786,809 977,012 1,009.0

April 319 2,761,953 4,562 190,568 806,145 996,713 1,023.8

May 321 3,177,467 5,169 191,032 814,584 1,005,616 1,007.6

June 321 2,799,201 4,417 191,481 846,608 1,038,089 1,009.8

July 321 3,028,378 5,029 192,433 851,312 1,043,745 1,030.3

August 324 3,016,567 5,124 190,525 814,601 1,005,126 1,044.5

September 324 2,870,173 4,769 191,042 823,424 1,014,466 1,046.0

October 325 3,225,576 5,618 192,406 828,042 1,020,448 1,050.1

November 326 3,253,328 5,632 193,079 832,748 1,025,827 1,070.9

December 326 3,784,838 7,811 196,457 829,679 1,026,136 1,216.4

2007 January 327 3,262,800 6,370 196,003 834,349 1,030,352 1,065.5

February 328 2,692,596 4,819 196,594 828,152 1,024,746 1,060.1

March 329 3,274,464 5,862 196,780 846,217 1,042,997 1,040.6

April 329 3,262,646 5,828 152,666 854,004 1,006,670 1,093.5

May 332 3,292,101 5,661 155,261 862,632 1,017,893 1,089.6

June 334 3,004,774 4,975 160,637 871,199 1,031,836 1,208.4

During the month Number of Cards in CirculationEndof

Period

Number of ATMs

in Operation

OutstandingAdvances onCredit Cards

(Rs million)

183

Table 2.20: Transactions on the Stock Exchange of Mauritius

Annual R

eport 2006-07

Statistical Tab

les

1 The SEM Total Return Index (SEMTRI) was launched on 3 October 2002 at 743.44, in Rupee terms, and 391.34 in US dollar terms (Base value as at 5 July 1989=100). The new index includes price earning ratios and dividend earnings, besides measuring daily price changes onlisted stocks. The index has been worked back so as to provide the market's evolution over time.

2 The SEM-7 started with an index value of 100 on 30 March 1998.Source: Stock Exchange of Mauritius Ltd.

OFFICIAL MARKET

Average

SEMTRI 1 SEMTRI 1 SEM-7 1 SEMDEX Value of Volume of(in Rs terms) (in US$ terms) Transactions Transactions

(Rs'000) ('000)

2006 July 21 2,110.10 1,060.63 187.00 852.36 18,819 426

August 21 2,223.55 1,089.49 195.58 890.52 14,331 794

September 21 2,394.35 1,154.33 207.36 957.06 16,904 623

October 21 2,631.06 1,259.09 228.19 1,046.08 17,704 551

November 21 2,979.76 1,412.80 255.29 1,181.17 24,762 771

December 20 3,028.73 1,426.82 259.47 1,193.69 105,922 3,221

2007 January 21 3,244.01 1,515.07 281.15 1,276.51 25,890 686

February 18 3,265.93 1,534.24 286.47 1,284.03 215,290 4,616

March 20 3,327.80 1,591.49 294.11 1,305.58 20,607 529

April 21 3,444.42 1,669.21 304.26 1,345.27 27,817 684

May 22 3,513.32 1,730.77 317.95 1,369.27 31,129 636

June 21 3,698.34 1,811.60 327.11 1,386.03 28,688 641

Number ofSessions

Period

184

Australian dollar 22.41 23.13 23.98 24.76 26.13 26.95 25.86 26.78 26.23 27.22

Euro 38.26 39.73 40.73 42.28 43.53 45.20 42.23 43.93 41.39 43.06

Hong Kong dollar 3.92 4.06 4.12 4.26 4.24 4.37 4.12 4.27 3.98 4.13

Indian rupee (100) 66.00 68.00 70.00 72.00 74.00 77.00 74.00 77.00 76.00 79.00

Japanese yen (100) 26.31 27.19 27.19 28.11 27.90 28.84 27.52 28.46 25.24 26.07

Kenya shilling (100) 41.37 43.06 44.51 46.26 47.40 49.24 46.80 48.86 47.29 49.31

Malagasy franc (100) 2 1.49 1.50 1.57 1.63 1.68 1.73 1.73 1.77 1.77 1.80

Malawi kwacha 0.22 0.23 0.23 0.24 0.23 0.24 0.23 0.24 0.21 0.23

New Zealand dollar 18.42 19.09 20.80 21.56 23.01 23.78 22.77 23.61 23.82 24.71

Pakistan rupee (100) 50.73 53.18 53.00 55.63 53.26 55.90 52.79 55.41 51.36 53.90

Seychelles rupee 5.76 6.04 6.07 6.37 6.18 6.49 5.17 5.43 4.90 5.16

Singapore dollar 19.09 19.75 20.16 20.84 21.39 22.09 21.30 22.04 20.37 21.09

South African rand 4.29 4.48 4.22 4.41 4.75 4.97 4.43 4.64 4.39 4.61

Swiss franc 24.37 25.23 25.52 26.42 26.67 27.56 26.25 27.20 25.11 26.04

Tanzania shilling (100) 2.39 2.52 2.55 2.68 2.52 2.65 2.54 2.67 2.43 2.56

Uganda shilling (100) 1.61 1.69 1.69 1.78 1.82 1.92 1.81 1.90 1.91 2.01

US dollar 29.97 31.01 31.55 32.69 32.31 33.42 31.78 32.93 30.90 32.02

Pound sterling 54.97 57.02 59.82 62.01 64.58 66.95 62.39 64.74 61.80 64.14

Zambia kwacha (100) 0.88 0.93 0.79 0.83 0.73 0.79 0.81 0.80 0.80 0.87

1 End of month.2 As from Monday 3 January 2005, Madagascar abandoned the Malagasy Franc and switched to the new Ariary currency, which was launched on 31 July 2003 at five times parity with the Malagasy Franc.

Table 3.1: Exchange Rates 1

(Rupees)

CURRENCY Jun-06 Sep-06 Dec-06 Mar-07 Jun-07

Buying Selling Buying Selling Buying Selling Buying Selling Buying Selling

Statistical Tab

lesA

nnual Rep

ort 2006-07

185

Annual R

eport 2006-07

Statistical Tab

les

Australian dollar 23.630 24.693 24.946 25.092 26.064 26.708 26.760 26.646 26.481 27.139 26.309 26.992

Hong Kong dollar 4.084 4.190 4.260 4.282 4.323 4.354 4.364 4.337 4.290 4.230 4.115 4.124

Indian rupee (100) 68.524 70.095 71.952 73.524 75.429 76.250 77.333 77.000 76.400 78.286 78.955 79.286

Japanese yen (100) 27.233 27.963 28.204 28.114 28.953 29.173 28.543 28.372 28.734 27.950 26.570 26.210

Kenya shilling (100) 43.460 45.168 46.061 46.640 47.734 48.984 49.097 49.232 48.799 48.476 48.275 48.979

New Zealand dollar 19.514 20.554 21.562 21.905 22.344 23.269 23.484 23.368 23.218 24.039 23.404 24.257

Singapore dollar 19.979 20.594 20.899 21.037 21.554 21.920 22.117 22.143 22.040 21.889 21.153 21.010

South African rand 4.531 4.754 4.540 4.443 4.739 4.908 4.837 4.832 4.643 4.701 4.629 4.551

Swiss franc 25.367 26.208 26.446 26.269 27.004 27.774 27.154 27.171 27.333 27.042 26.090 25.984

US dollar 31.267 32.081 32.617 32.847 33.113 33.305 33.568 33.511 33.086 32.655 31.896 31.992

Pound sterling 57.875 61.102 62.147 62.403 64.439 66.757 66.881 66.089 64.610 64.911 63.135 63.540

Euro 40.032 41.585 42.184 42.297 43.722 45.226 44.591 44.028 43.876 44.061 42.865 42.908

1 Selling Rates.

Table 3.2: Daily Average Exchange Rates 1

(Rupees)

CURRENCY Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Apr-07 May-07 Jun-07

186

Statistical Tab

lesA

nnual Rep

ort 2006-07

Table 3.3: Exchange Rate Movements of Selected Currencies vis-à-vis the Euro 1

1 Period average.Note: The daily average exchange rate of the rupee against the euro is based on the average selling rates of Banks while the daily exchange rates of the other selected currencies against the euro are derived from Reuters.

January 1999 June 2007 Appreciation/

(Depreciation)

of Selected Currencies

between [1] & [2]

(Per cent)

(1) (2) (3)

Hong Kong dollar 8.9689 10.4844 (14.5)

Indonesian rupiah 9,961.02 12,041.06 (17.3)

Korean won 1,358.76 1,244.85 9.2

Mauritian rupee 28.987 42.908 (32.4)

Philippines peso 44.395 61.973 (28.4)

Singapore dollar 1.9453 2.0612 (5.6)

South African rand 6.9690 9.5994 (27.4)

Taiwan dollar 37.333 44.249 (15.6)

Thailand baht 42.3655 46.2097 (8.3)

187

Annual R

eport 2006-07

Statistical Tab

les

Table 3.4: Gross Official International Reserves

1 Valued at end-of-period exchange rate.

2006 July 43,306 548 0.4 43,854.4 1,397.3

August 44,191 569 0.5 44,760.5 1,376.9

September 43,015 566 0.3 43,581.3 1,336.3

October 41,841 525 0.3 42,366.3 1,285.5

November 43,685 549 0.6 44,234.6 1,307.3

December 44,127 543 0.3 44,670.3 1,300.9

2007 January 42,647 446 0.2 43,093.2 1,289.0

February 44,716 441 0.4 45,157.4 1,379.1

March 47,337 438 0.2 47,775.2 1,475.5

April 50,736 383 0.3 51,119.3 1,617.4

May 49,992 376 0.4 50,368.4 1,611.9

June 52,784 338 0.2 53,122.2 1,678.1

Gross Foreign

Assets of

Bank of MauritiusEnd of Month

Reserve

Position

in the IMF

Foreign

Assets of the

Government

Gross Official

International

Reserves

Gross Official

International

Reserves1

(Rs million) (US$ million)

188

Table 3.5: Net International Reserves(Rs million)

End of Month Bank of MauritiusNet Foreign Assets

Government of MauritiusForeign Assets

Reserve Position in IMF

Other DepositoryCorporations Net Foreign

Assets 1

Net InternationalReserves

2005 January 44,186.5 1.2 950.2 19,258.7 64,396.6

February 44,846.8 1.1 966.5 22,105.9 67,920.3

March 44,680.4 0.9 1,003.8 24,684.3 70,369.4

April 44,826.4 0.7 1,009.1 25,413.9 71,250.1

May 43,505.7 1.6 986.4 25,176.3 69,670.0

June 42,571.1 1.4 979.6 22,254.3 65,806.4

July 41,851.6 1.3 985.0 20,808.0 63,645.9

August 42,188.7 1.2 995.8 22,161.2 65,346.9

September 42,112.0 1.0 1,002.5 20,614.6 63,730.1

October 41,734.3 0.9 963.0 20,984.6 63,682.8

November 40,871.8 0.7 954.8 23,404.8 65,232.1

December 40,977.3 0.6 767.3 21,559.0 63,304.2

2006 January 41,800.9 0.5 565.3 25,669.0 68,035.7

February 41,222.2 0.4 563.4 26,850.7 68,636.7

March 41,273.1 0.4 565.9 29,536.7 71,376.1

April 42,190.6 0.5 533.2 26,535.0 69,259.3

May 43,042.8 0.4 541.1 23,558.6 67,142.9

June 42,314.6 0.3 537.8 21,887.6 64,740.3

July 43,158.5 0.4 547.6 23,184.8 66,891.3

August 44,059.5 0.5 569.0 26,207.9 70,836.9

September 42,890.6 0.3 566.1 28,703.4 72,160.4

October 41,713.8 0.3 524.7 29,879.0 72,117.8

November 43,552.4 0.6 548.8 32,984.9 77,086.7

December 44,006.7 0.3 542.5 34,049.1 78,598.6

2007 January 42,514.7 0.2 446.0 35,347.0 78,307.9

February 44,527.2 0.4 441.2 36,925.4 81,894.2

March 46,962.5 0.2 437.8 33,441.6 80,842.1

April 50,203.5 0.3 383.3 29,624.3 80,211.4

May 49,459.9 0.4 376.1 28,872.7 78,709.1

June 52,222.7 0.2 337.6 30,938.9 83,499.4

1 Prior to June 2005, comprises the Net Foreign Assets of 11 former Category 1 banks. With effect from June 2005, comprises the Net Foreign Assets of banks, adjusted for transactions of Global Business Licence Holders.

Statistical Tab

lesA

nnual Rep

ort 2006-07

189

Annual R

eport 2006-07

Statistical Tab

les

Table 3.6: Exports 2 - Principal Countries of Destination(f.o.b. value) (Rs million)

Australia 116 125 22 32 27 35 26 37 34 28 22 23

Belgium 1,559 1,851 394 430 372 363 374 447 527 503 472 557

Canada 89 138 21 20 16 32 26 33 34 45 19 38

France 8,391 8,704 1,979 2,380 1,880 2,152 1,818 2,254 2,107 2,525 1,858 2,535

Germany 1,070 1,295 244 312 286 228 251 348 284 412 336 462

Italy 3,308 2,754 574 781 1,000 953 621 693 616 824 754 899

Malagasy, Republic of 3,373 3,288 708 901 876 888 736 869 803 880 889 1,052

Netherlands 723 870 187 176 168 192 179 164 174 353 218 265

Reunion 1,561 1,652 341 353 351 516 283 408 407 554 461 443

South Africa, Republic of 788 1,488 145 158 236 249 336 324 420 408 388 510

United States of America 5,640 5,754 1,335 1,471 1,552 1,282 1,061 1,959 1,500 1,234 1,242 1,242

United Kingdom 19,215 22,362 4,128 3,378 6,298 5,411 4,847 3,386 7,150 6,979 4,272 3,939

Other 13,262 18,685 1,992 3,411 3,835 4,024 4,052 5,328 3,769 5,536 3,293 3,377

TOTAL 59,095 68,966 12,070 13,803 16,897 16,325 14,610 16,250 17,825 20,281 14,224 15,342

1 Provisional. 2 Excluding Ship's stores & Bunkers. Source: Central Statistics Office, Government of Mauritius.

2005 2006 1 2007 1

1st Qr 2nd Qr 3rd Qr 4th Qr 1st Qr 2nd Qr 3rd Qr 4th Qr 1st Qr 2nd Qr

COUNTRY 2005 2006 1

190

Table 3.7: Direction of EPZ Exports(f.o.b. value) (Rs million)

Belgium 1,279 1,432 281 365 316 317 264 387 405 376 375 457

France 6,045 6,573 1,328 1,767 1,299 1,651 1,259 1,792 1,559 1,963 1,358 1,929

Germany 730 927 190 187 157 196 166 227 226 308 283 397

Hong Kong (S.A.R) 3 53 70 13 9 16 15 12 12 16 30 13 14

Italy 1,190 1,834 283 259 273 375 368 506 380 580 445 721

Malagasy, Republic of 773 1,050 142 222 195 214 230 271 245 304 299 467

Netherlands 550 740 156 136 119 139 175 162 162 241 212 238

Switzerland 552 551 145 159 121 127 143 163 131 114 151 212

Singapore 8 5 1 2 2 3 1 2 1 1 1 1

United Kingdom 9,208 11,385 1,967 2,507 2,223 2,511 2,204 2,937 3,013 3,231 2,894 3,579

United States of America 5,130 4,404 1,283 1,285 1,512 1,050 819 1,220 1,228 1,137 1,103 1,139

Other 3,436 4,639 711 718 912 1,095 987 1,161 1,218 1,273 1,024 1,203

TOTAL 28,954 33,610 6,500 7,616 7,145 7,693 6,628 8,840 8,584 9,558 8,158 10,357

1 Revised 2 Provisional 3 Special Administrative Region of China. Source: Central Statistics Office, Government of Mauritius.

2005 2006 1 2007 2


COUNTRY 2005 2006 1

Statistical Tab

lesA

nnual Rep

ort 2006-07

191

Annual R

eport 2006-07

Statistical Tab

les

Table 3.8: EPZ Imports and Exports by Main Commodities(Rs million)

Total EPZ Imports (c.i.f.) 15,518 19,026 3,442 4,485 3,993 3,598 4,080 4,915 4,872 5,159 4,544 5,402

Raw Materials 13,658 16,791 2,904 3,852 3,617 3,285 3,673 4,219 4,312 4,587 3,980 4,852

Machinery 1,860 2,235 538 633 376 313 407 696 560 572 564 550

Total EPZ Exports (f.o.b.) 28,954 33,610 6,500 7,616 7,145 7,693 6,628 8,840 8,584 9,558 8,154 10,353

Fish and Fish Preparations 3,141 4,950 518 803 893 927 943 1,374 1,313 1,320 1,007 1,549

Textile Yarn, Fabrics, Made-up

Articles 1,404 1,633 307 380 360 357 365 444 420 404 475 616

Pearls, Precious and

Semi-precious Stones 1,394 1,375 303 390 355 346 312 356 376 331 329 388

Articles of Apparel and Clothing 19,194 21,690 4,439 5,097 4,576 5,082 4,141 5,698 5,513 6,338 5,431 6,783

Watches and Clocks 415 404 119 113 94 89 103 125 93 83 128 169

Toys, Games and Sporting Goods 137 127 31 41 32 33 23 34 32 38 24 37

Other 3,269 3,431 783 792 835 859 741 809 837 1,044 760 811

Net EPZ Exports 13,436 14,584 3,058 3,131 3,152 4,095 2,548 3,925 3,712 4,399 3,610 4,951

1 Revised 2 Provisional Source: Central Statistics Office, Government of Mauritius.

2005 2006 1 2007 2


2005 2006 1

192

Table 3.9: Imports and Exports - Major Commodity Groups(Rs million)

Imports (c.i.f. value)

Food and Live Animals 13,820 17,276 2,958 3,512 3,300 4,050 3,582 3,969 4,436 5,289 4,001 4,940

Beverages and Tobacco 839 952 148 195 198 298 213 194 187 358 250 234

Crude Materials, Inedible except Fuels 2,097 2,769 539 612 482 464 802 686 632 649 855 803

Mineral Fuels, Lubricants and

Related Products 15,394 19,321 2,876 3,826 4,187 4,505 4,589 4,762 5,120 4,850 4,923 5,634

Animal and Vegetable Oils and Fats 845 711 194 247 213 191 76 263 154 218 209 188

Chemicals and Related Products 7,386 8,157 1,693 1,735 1,900 2,058 1,881 1,870 2,144 2,262 1,954 2,183

Manufactured Goods classified chiefly

by Materials 19,297 21,811 4,050 5,097 5,212 4,938 4,590 5,259 5,603 6,359 5,198 6,461

Machinery and Transport Equipment 26,110 35,931 4,579 7,568 7,261 6,702 6,190 8,248 7,246 14,247 5,028 5,932

Miscellaneous Manufactured Articles 7,257 8,208 1,252 1,742 1,874 2,389 1,559 1,851 2,078 2,720 1,828 2,148

Commodities and Transactions not

classified elsewhere in the SITC 3 237 366 44 51 90 52 135 65 64 102 127 164

TOTAL 93,282 115,502 18,333 24,585 24,717 25,647 23,617 27,167 27,664 37,054 24,373 28,687

Exports (f.o.b. value)

Cane Sugar 10,536 11,198 2,285 856 4,412 2,983 2,593 456 4,193 3,956 1,954 504

Cane Molasses 173 153 - - 84 89 - - 52 101 - -

Export Processing Zone Products 28,954 33,610 6,500 7,616 7,145 7,693 6,628 8,840 8,584 9,558 8,158 10,357

Other 2,441 2,677 527 618 490 806 1,913 1,661 2,085 2,089 1,944 1,962

Re-exports 16,991 21,328 2,758 4,713 4,766 4,754 4799 6,399 4,223 5,907 3,404 3,724

TOTAL 59,095 68,966 12,070 13,803 16,897 16,325 15,933 17,356 19,137 21,611 15,460 16,547

Ship's Stores and Bunkers (f.o.b. value) 4,124 5,071 839 837 968 1,480 1,323 1,106 1,312 1,330 1,236 1,205

1 Revised. 3 Standard International Trade Classification.2 Provisional.Source: Central Statistics Office, Government of Mauritius.

2005 2006 1 2005 2006 1 2007 2


Statistical Tab

lesA

nnual Rep

ort 2006-07

193


Table 3.10: Merchandise Imports

n.e.s: not elsewhere speciified.Note: As from 2002, data on imports include transactions through the Mauritius Freeport.Source: Central Statistics Office, Government of Mauritius.

(c.i.f. value) (Rs million)

SITC Code Standard International Trade Classification 2003 2004 2005 2006

00 Food and Live Animals 10,308 11,947 13,820 17,276Meat and Meat Preparations 860 977 999 1,192Dairy Products and Bird's Eggs 1,465 1,531 1,815 1,870

Milk and Cream 1,049 1,071 1,284 1,302Fish and Fish Preparations 2,542 3,170 4,266 6,687Cereals and Cereal Preparations 2,051 2,598 2,705 2,845

Wheat 754 565 898 869Rice 658 893 909 986Flour 2 311 41 1Other 637 829 857 989

Vegetables and Fruits 1,282 1,325 1,443 1,581Vegetables 659 649 752 815

Feeding Stuff for Animals 294 421 401 406Other 1,814 1,925 2,191 2,696

01 Beverages and Tobacco 626 698 839 952Alcoholic Beverages 365 426 459 528Unmanufactured Tobacco 5 8 12 6Other 256 264 368 418

02 Crude Materials, Inedible except Fuels 1,542 2,061 2,097 2,769

03 Mineral Fuels, Lubricants and Related Products 7,290 10,020 15,394 19,321Petroleum Products, Refined 6,391 8,791 13,471 17,025Other 899 1,229 1,923 2,296

04 Animal and Vegetable Oils and Fats 639 712 845 711Fixed Vegetable Oils and Fats 518 596 720 594Other 121 116 125 117

05 Chemicals and Related Products 5,770 6,412 7,386 8,157Organic Chemicals 404 374 409 430Inorganic Chemicals 494 371 383 389Dyeing and Tanning Materials 512 550 571 623Medical and Pharmaceutical Products 1,156 1,476 1,516 1,890Fertilisers 315 310 536 471Plastics in non-primary forms 476 582 674 721Other 2,413 2,749 3,295 3,633

06 Manufactured Goods classified chiefly by Materials 18,863 19,806 19,297 21,811Rubber, Wood, Cork, Paper and Paper Board Manufactures 1,968 2,269 2,457 2,746Textile Yarn, Fabrics, Made-up Articles and Related Products 9,950 9,221 7,427 8,441Lime, Cement and Fabricated Construction Materials 821 1,237 1,401 1,587Iron and Steel 1,564 1,886 2,235 2,423Manufactures of Metal, n.e.s. 1,767 1,952 2,247 2,610Other 2,793 3,241 3,530 4,004

07 Machinery and Transport Equipment 14,241 17,916 26,110 35,931Machinery Specialized for Particular Industries 2,237 3,451 3,046 3,350General Industrial Machinery & Equipment, n.e.s.,

& machine parts, n.e.s. 1,982 2,368 2,795 3,051Electric Machinery, Apparatus and Appliances, n.e.s.

and Electrical Parts of Household Type 2,246 2,796 2,996 2,926Road Vehicles 2,805 4,028 4,216 4,505Other 4,971 5,273 13,057 22,099

08 Miscellaneous Manufactured Articles 6,521 6,624 7,257 8,208Articles of Apparel and Clothing 789 889 1,195 1,163Professional, Scientific and Controlling Instruments

and Apparatus, n.e.s. 644 499 490 722Other 5,088 5,236 5,572 6,323

09 Commodities and Transactions not elsewhere specified 142 191 237 366

TOTAL 65,942 76,387 93,282 115,502

194

Table 3.11: Imports - Main Sources of Supply(c.i.f. value) (Rs million)

Australia 2,699 3,105 620 655 683 741 561 819 816 909 580 691

Bahrain 5,086 1,349 908 2,238 952 988 878 332 137 2 1 1

Belgium 1,488 1,758 370 366 331 421 477 424 413 444 365 405

China 9,166 9,988 1,735 2,361 2,380 2,690 1,795 2,326 2,624 3,243 2,359 3,191

France 6,958 16,440 1,606 1,799 1,672 1,881 1,870 2,194 2,981 9,395 2,189 2,286

Germany 3,794 4,613 659 1,030 1,294 811 1,140 1,388 880 1,205 739 731

Hong Kong (S.A.R) 2 652 597 142 209 145 156 139 162 142 154 114 168

India 6,461 15,687 1,702 1,612 1,731 1,416 2,331 2,301 4,684 6,371 5,718 6,542

Italy 2,402 2,950 416 805 546 635 542 673 784 951 614 897

Japan 3,333 3,254 708 823 926 876 677 950 757 870 905 924

Kenya 283 420 109 52 49 73 74 135 130 81 47 44

Malaysia 2,670 2,978 484 638 719 829 574 712 877 815 776 686

Netherlands 466 667 86 130 119 131 124 141 147 255 136 141

New Zealand 823 851 205 239 174 205 203 224 179 245 220 311

Pakistan 1,011 1,239 221 293 255 242 298 257 316 368 287 318

Republic of South Africa 8,066 8,433 1,673 2,026 1,987 2,380 1,962 2,194 1,920 2,357 1,881 2,207

Republic of Korea 906 1,081 153 223 246 284 220 292 260 309 424 409

Singapore 1,586 1,103 210 251 843 282 244 252 238 369 254 386

United States of America 1,972 2,328 320 606 492 554 486 620 613 609 604 590

United Kingdom 2,589 2,894 540 596 798 655 663 683 639 909 759 1,071

Other 30,871 33,767 5,466 7,633 8,375 9,397 8,359 10,088 8,127 7,193 5,401 6,688

TOTAL 93,282 115,502 18,333 24,585 24,717 25,647 23,617 27,167 27,664 37,054 24,373 28,687

1 Provisional. 2 Special Administrative Region of China.Source: Central Statistics Office, Government of Mauritius.

2005 2006 2005 2006 2007 1

1st Qr 2nd Qr 3rd Qr 4th Qr 1st Qr 2nd Qr 3rd Qr 4th Qr 1st Qr 2nd Qr Statistical Tab

lesA

nnual Rep

ort 2006-07

195


1 Ratio of Export Price Index to Import Price Index. Source: Central Statistics Office, Government of Mauritius.Note: As from the first Quarter of 2004, the terms of trade are based on the Exports and Imports Indices instead of unit value indices.

Price Indices Terms

Period Export Import of Trade 1

Table 3.12: Export and Import Price Indices

Base Year: 1982 = 100

1985 136 121 113

1986 144 98 147

1987 161 102 158

1988 172 111 156

Base Year: 1988 = 100

1989 111 119 93

1990 125 127 98

1991 133 133 100

1992 142 135 105

Base Year: 1992 = 100

1993 109 111 98

1994 114 119 96

1995 121 126 96

1996 134 135 99

1997 140 138 101

Base Year: 1997 = 100

1998 114 106 108

1999 113 113 100

2000 112 117 96

2001 114 126 90

2002 124 132 94

Base Year: 2002 = 100

2003 109 112 97

2004 116 128 91

Base Year: 2003 = 100

2005 113 129 88

1st Quarter 112 124 90

2nd Quarter 112 125 90

3rd Quarter 115 134 84

4th Quarter 113 133 85

2006 120 145 83



3rd Quarter 122 148 82

4th Quarter 125 153 82

2007



196

Statistical Tab

lesA

nnual Rep

ort 2006-07

Reunion 82,628 83,966 83,749 86,945 91,140 96,375 95,679 96,510 99,036 89,127

Republic of South Africa 51,249 49,676 46,583 48,683 47,882 42,685 45,756 52,609 58,446 70,796

France 145,173 162,775 175,431 198,423 197,595 202,869 200,229 210,411 220,421 182,295

Madagascar 10,143 9,213 7,880 7,057 6,674 9,417 11,044 8,256 7,397 7,239

Germany 43,993 43,826 45,206 52,869 50,866 53,762 53,970 52,277 55,983 57,251

United Kingdom 46,022 52,299 58,683 74,488 77,888 80,667 91,210 92,652 95,407 102,333

Italy 35,255 36,614 36,675 39,000 37,343 38,263 39,774 41,277 43,458 69,407

Switzerland 16,105 16,178 16,281 20,473 18,427 17,371 17,929 16,110 15,773 16,161

Zimbabwe 4,248 3,796 2,606 3,435 3,860 3,185 2,343 2,345 2,419 1,587

India 13,220 12,629 13,583 17,241 18,890 20,898 25,367 24,716 29,755 37,498

Australia 9,460 8,913 8,076 8,771 8,790 8,387 9,103 11,373 13,486 16,660

United States of America 2,879 3,158 3,345 3,704 3,923 4,116 4,505 4,305 4,890 5,220

Zambia 437 423 321 445 422 354 456 395 305 440

Kenya 1,230 1,684 1,655 1,801 1,734 1,507 1,510 1,506 1,358 1,694

Seychelles 8,995 8,529 7,893 9,229 10,687 13,468 9,869 7,456 10,084 12,023

Singapore 3,404 3,515 3,661 4,104 3,431 3,114 2,102 2,329 1,789 1,862

Other Countries 61,684 61,001 66,457 79,785 80,766 85,210 91,172 94,334 101,056 116,683

All Countries 536,125 558,195 578,085 656,453 660,318 681,648 702,018 718,861 761,063 788,276

Table 3.13(a): Tourist Earnings


1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Tourist Earnings (Rs million) 10,068 11,890 13,668 14,234 18,166 18,328 19,415 23,448 25,704 31,942

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Nights 10.2 10.0 9.9 9.8 9.9 9.9 9.9 9.9 9.9 9.8

Country of Residence 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Table 3.13(b): Tourist Arrivals by Country of Residence

Table 3.13(c): Average Stay of Tourists

197

Annual R

eport 2006-07

Statistical Tab

les

Table 3.13(d): Tourist Arrivals and Tourist Earnings: January 2005 - June 2007

1 The figures for 2007 relate to the period January to June only.* Source: Ministry of Tourism, Leisure and External Communications.

2005 2006 2007

Tourist Arrivals * Tourist Earnings Tourist Arrivals * Tourist Earnings Tourist Arrivals * Tourist Earnings (Rs million) (Rs million) (Rs million)

January 73,053 2,429 86,218 3,411 91,628 4,043

February 56,367 2,251 64,894 2,716 72,338 3,411

March 67,931 2,396 58,136 2,941 79,965 3,337

April 52,971 1,891 57,361 2,381 70,297 3,468

May 55,995 2,080 50,773 2,314 65,301 2,970

June 42,994 1,537 42,755 1,688 52,584 2,523

July 65,462 1,596 65,540 1,929

August 60,746 2,053 64,307 2,483

September 53,233 1,779 56,138 2,195

October 70,999 2,066 75,451 2,600

November 70,793 2,472 70,394 3,349

December 90,519 3,154 96,309 3,935

Total 761,063 25,704 788,276 31,942 432,113 1 19,752 1

198

Statistical Tab

lesA

nnual Rep

ort 2006-07

Table 3.14a: Foreign Direct Investment in Mauritius by Sector : 1990 - 2006 and First Half of 2007

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 1

Export Processing Zone 270 130 203 92 41 245 51 - 27 300 8 3 41 77 248 106 90 63Tourism 152 68 8 152 129 70 35 20 75 27 10 - 100 103 121 536 2,610 3,572Banking - 51 3 - - - 55 1,122 117 215 - 600 316 1,301 310 454 3,511 1,872Telecommunications - - - - - - - - - - 7,204 - - - 38 175 43 16Other 187 48 16 27 190 10 517 22 73 701 43 333 522 485 1,079 1,536 968 894

Total 609 297 230 271 360 325 658 1,164 292 1,243 7,265 936 979 1,966 1,796 2,807 7,222 6,417

Table 3.14b: Foreign Direct Investment in Mauritius by Country of Origin: 1990 - 2006 and First Half of 2007

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 1

China 17 11 3 3 1 - - - - - - - 18 33 - 38 6 -Dubai - - - - - - - 19 39 156 11 - 8 45 10 9 114 689France 75 57 25 35 39 17 17 34 48 33 7,214 25 232 157 492 427 523 526Germany 27 23 4 - 10 80 6 1 - 9 - - 4 - 95 46 177 5Hong Kong 55 36 31 40 4 19 - - - - - - 9 - 4 7 30 5India 78 1 - 8 35 157 43 69 55 1 - - 2 143 150 670 160 17Luxembourg - 17 - - - - - - 66 - - - - - 29 369 34 11Malaysia 10 25 57 129 60 11 27 - - 25 - - 30 70 - - - 17Pakistan - - - - - - 25 18 17 15 - - - - - 50 50 - Panama 15 16 - - 16 - - - - - - - - - 13 4 13 - Reunion Island 53 13 6 10 49 - - - - - 30 - - 174 5 130 126 67Singapore 18 - 14 2 6 - 519 - - - - - 13 1 - - - 13South Africa 2 7 3 - 2 - - 964 - 575 1 600 333 1,022 19 26 38 246Switzerland 45 5 20 8 1 12 - - 3 5 5 274 - 2 42 148 584 412Taiwan 91 - 1 - - - - - - - - - - - - - - 1UK 8 42 13 4 24 29 19 38 50 405 - - 157 172 143 578 3,821 2,148USA 1 - 46 - 1 - - - - - 3 3 29 37 518 75 163 1,802Other 114 44 7 32 112 - 2 21 14 19 1 34 144 110 276 230 1,383 458

Total 609 297 230 271 360 325 658 1,164 292 1,243 7,265 936 979 1,966 1,796 2,807 7,222 6,417

1 January to June.

(Rs million)

(Rs million)

199

Annual R

eport 2006-07

Statistical Tab

les

Table 3.15a: Direct Investment Abroad by Sector: 1990 - 2006 and First Half of 2007

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 1

Tourism - 165 - - - - 3 - 30 8 68 - - 137 422 967 391 98

Banking - - 613 443 - - - - 114 68 180 47 - 440 - - - -

Manufacturing 5 5 - 15 9 14 24 13 25 10 13 - 245 41 101 258 335 77

Other 3 - 61 129 10 49 21 54 160 76 72 36 33 538 447 717 408 171

Total 8 170 674 587 19 63 48 67 329 162 333 83 278 1,156 970 1,942 1,134 346

Table 3.15b: Direct Investment Abroad by Host Country: 1990 - 2006 and First Half of 2007

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 1

France 3 - 2 3 3 4 3 - 5 - 180 - - - 10 58 2 21

Reunion Island - - 613 - - - - - 17 10 - 6 3 7 36 24 5 2

USA - - 3 - 5 - - - 6 5 - - - - 10 - - -

Switzerland - - - - - - - - 16 - - - - - - - - -

Madagascar 5 5 - 20 4 5 - 13 19 57 2 2 238 47 195 195 291 65

Maldives - - - - - - - - - - - - - - 333 808 107 31

South Africa - - - - 1 2 3 20 5 - - 1 - 7 6 1 14 2

India - - - 450 1 3 3 - 148 - - - - - - 1 2 29

Seychelles - - - - - - - - 30 9 68 - - 570 75 89 187 58

Kenya - - - 1 2 - - - - - - - - - - - - -

Mozambique - - - - - - - - 5 81 - 58 - 523 253 532 270 106

Comores - 165 - - - 49 18 26 - - - - - - - - - -

Other - - 56 113 3 - 21 8 78 - 83 16 37 2 52 234 256 32

Total 8 170 674 587 19 63 48 67 329 162 333 83 278 1,156 970 1,942 1,134 346

1 January to June.

(Rs million)

(Rs million)

200


Table 3.16: Balance of Payments: 2004 - 2006


(Rs million)

2004 2005 2006

I. CURRENT ACCOUNT -3,181 -9,570 -19,399

A. Goods and Services -4,165 -11,128 -23,301

Goods -16,006 -23,515 -34,532

Exports 54,905 63,219 74,037

Imports -70,911 -86,734 -108,569

General Merchandise -16,685 -25,569 -36,984

Credit 52,704 59,095 68,966

Debit -69,389 -84,664 -105,950

Goods procured in Ports by Carriers 679 2,054 2,452

Credit 2,201 4,124 5,071

Debit -1,522 -2,070 -2,619

Non-monetary Gold -191 -364 -361

Services 11,841 12,387 11,231

Credit 39,954 47,720 53,091

Transportation 10,254 11,336 11,527

Passenger 8,259 9,376 9,462Freight 776 856 857Other 1,219 1,104 1,208

Travel 23,448 25,704 31,941

Business 9,063 10,848 11,637Personal 14,385 14,856 20,304

Other Services 6,252 10,680 9,623

Private 6,078 10,407 9,365Government 174 273 258

Debit -28,113 -35,333 -41,860

Transportation -12,911 -15,428 -16,966

Passenger -604 -603 -648Freight -5,875 -7,296 -8,159Other -6,432 -7,529 -8,159

Travel -7,008 -8,110 -10,415

Business -379 -733 -455Personal -6,629 -7,377 -9,960

Other Services -8,194 -11,795 -14,479

Private -7,702 -11,656 -14,331Government -492 -139 -148

B. Income -390 -239 1,633

Credit 1,418 4,270 11,961

Compensation of Employees 20 18 23

Direct Investment Income 110 135 74

Portfolio Investment Income 95 101 114

Other Investment Income 1,193 4,016 11,750

Monetary Authorities 1,166 1,379 1,689General Government 0 0 0Other 27 2,637 10,061

201


(Rs million)

2004 2005 2006

Debit -1,808 -4,509 -10,328

Compensation to employees -257 -273 -321

Direct Investment Income -368 -991 -2,794

Portfolio Investment Income -247 -506 -730

Other Investment Income -936 -2,739 -6,483

Monetary Authorities -13 -19 -17General Government -209 -260 -282Other -714 -2,460 -6,184

C. Current Transfers 1,374 1,797 2,269

Credit 4,630 4,782 5,694

Private 4,024 4,302 5,146

Government 606 480 548

Debit -3,256 -2,985 -3,425

Private -3,143 -2,811 -3,234

Government -113 -174 -191

II. CAPITAL AND FINANCIAL ACCOUNT 884 9,043 10,363

D. Capital Account -44 -52 -83

Migrants' Transfers -44 -52 -83

E. Financial Account 928 9,095 10,446

Direct Investment -564 -176 3,018

Abroad -871 -1,402 -321

In Mauritius 307 1,226 3,339

Portfolio Investment -1,041 -481 -878

Assets -1,457 -1,235 -3,508

Equity Securities -1,331 -1,235 -3,508

Debt Securities -126 0 0

Liabilities 416 754 2,630

Equity Securities 524 1,058 1,108

Debt Securities -108 -304 1,522

Other Investment 1,676 4,864 3,733

Assets -1,563 -6,777 -11,785

General Government 0 0 0

Banks -1,330 -5,708 -10,804

Other Sectors: Long-term 0 0 0

Other Sectors: Short-term -233 -1,069 -981

Liabilities 3,239 11,641 15,518

General Government -212 285 -614

Banks 1,661 183 -176

Other Sectors: Long-term -2,077 1,014 920

Other Sectors: Short-term 3,867 10,159 15,388

Reserve Assets 857 4,888 4,573

Monetary Gold 0 0 0

Special Drawing Rights -12 -19 -17

Reserve Position in the Fund 0 191 315

Foreign Exchange 869 4,715 4,275

Other Claims 0 1 0

III. NET ERRORS AND OMISSIONS 2,297 527 9,036

Table 3.16: Balance of Payments: 2004 - 2006 (cont’d)

Notes (i): This table has been recast with a view to providing a more detailed classification of the Balance of Payments. In line with the methodology laid down in the Fifth Edition of the IMF's Balance of Payments Manual, valuation changes are excluded from reserve assets transactions.

(ii) As from the First Quarter of 2002, data on imports and exports include transactions through the Mauritius Freeport.

202


Table 3.17: Quarterly Balance of Payments: 2006-07


(Rs million)

2006 2007

2006-07 1 3rd 4th 1st 2ndQuarter Quarter Quarter 1 Quarter 1

I. CURRENT ACCOUNT -17,469 -6,644 -7,088 890 -4,627

A. Goods and Services -23,993 -5,651 -9,683 -2,390 -6,269

Goods -38,073 -6,986 -13,255 -7,542 -10,290Exports 72,755 19,137 21,611 15,460 16,547Imports -110,828 -26,123 -34,866 -23,002 -26,837

General Merchandise -40,395 -7,568 -13,870 -8,079 -10,878Credit 67,672 17,825 20,281 14,224 15,342Debit -108,067 -25,393 -34,151 -22,303 -26,220

Goods procured in Ports by Carriers 2,322 582 615 537 588Credit 5,083 1,312 1,330 1,236 1,205Debit -2,761 -730 -715 -699 -617

Non-monetary Gold -458 -63 -104 -127 -164

Services 14,080 1,335 3,572 5,152 4,021Credit 60,238 11,969 15,843 17,162 15,264

Transportation 12,773 2,890 3,449 3,698 2,736Passenger 10,594 2,410 2,856 3,109 2,219Freight 721 218 238 84 181Other 1,458 262 355 505 336

Travel 36,243 6,606 9,884 10,791 8,962Business 12,896 2,036 3,464 4,078 3,318Personal 23,347 4,570 6,420 6,713 5,644

Other Services 11,222 2,473 2,510 2,673 3,566Private 10,835 2,375 2,465 2,566 3,429Government 387 98 45 107 137

Debit -46,158 -10,634 -12,271 -12,010 -11,243Transportation -18,446 -4,263 -4,848 -5,140 -4,195

Passenger -725 -201 -148 -157 -219Freight -8,306 -1,941 -2,482 -1,775 -2,108Other -9,415 -2,121 -2,218 -3,208 -1,868

Travel -11,442 -2,961 -3,235 -2,724 -2,522Business -443 -131 -103 -72 -137Personal -10,999 -2,830 -3,132 -2,652 -2,385

Other Services -16,270 -3,410 -4,188 -4,146 -4,526Private -16,126 -3,387 -4,167 -4,116 -4,456Government -144 -23 -21 -30 -70

B. Income 3,499 -1,554 1,815 2,586 652

Credit 19,385 3,076 4,402 5,712 6,195Compensation of Employees 21 5 5 6 5Direct Investment Income 63 0 7 13 43Portfolio Investment Income 180 34 21 37 88Other Investment Income 19,121 3,037 4,369 5,656 6,059

Monetary Authorities 2,071 573 448 529 521General Government 0 0 0 0 0Other 17,050 2,464 3,921 5,127 5,538

203


Table 3.17: Quarterly Balance of Payments: 2006-07 (cont’d)

Note: This table has been recast with a view to providing a more detailed classification of the Balance of Payments. In line with the methodology laid down in the Fifth Edition of the IMF's Balance of Payments Manual, valuation changes are excluded from reserve assets transactions. As from Quarter 3, 2005, 'Other Income' includes interest income of banks. As from Quarter 3, 2006, valuation changes are excluded from foreign assets and liabilities transactions of banks.1 Provisional Estimates.

(Rs million)

2006 2007

2006-07 1 3rd 4th 1st 2ndQuarter Quarter Quarter 1 Quarter 1

Debit -15,886 -4,630 -2,587 -3,126 -5,543Compensation to employees -340 -78 -105 -76 -81Direct Investment Income -4,136 -2,361 -63 -52 -1,660Portfolio Investment Income -1,124 -172 -219 -153 -580Other Investment Income -10,286 -2,019 -2,200 -2,845 -3,222

Monetary Authorities -15 -4 -4 -4 -3General Government -277 -28 -118 -27 -104Other -9,994 -1,987 -2,078 -2,814 -3,115

C. Current Transfers 3,025 561 780 694 990

Credit 6,745 1,384 1,628 1,765 1,968Private 6,390 1,343 1,615 1,760 1,672Government 355 41 13 5 296

Debit -3,720 -823 -848 -1,071 -978Private -3,583 -781 -831 -1,049 -922Government -137 -42 -17 -22 -56

II. CAPITAL AND FINANCIAL ACCOUNT 5,988 1,025 9,784 -4,657 -164

D. Capital Account -50 -6 -13 -15 -16

Migrants' Transfers -50 -6 -13 -15 -16

E. Financial Account 6,038 1,031 9,797 -4,642 -148

Direct Investment 7,084 2,636 -746 1,399 3,795Abroad -767 -179 -241 -111 -236In Mauritius 7,851 2,815 -505 1,510 4,031

Portfolio Investment 2,725 -647 821 856 1,695

Assets -3,126 -832 -992 -537 -765Equity Securities -3,126 -832 -992 -537 -765Debt Securities 0 0 0 0 0

Liabilities 5,851 185 1,813 1,393 2,460Equity Securities 1,066 196 273 217 380Debt Securities 4,785 -11 1,540 1,176 2,080

Other Investment 2,832 -2,859 7,217 -1,481 -45

Assets -16,341 -4,116 -2,997 -7,134 -2,094General Government 0 0 0 0 0Banks -13,523 -2,648 -3,811 -5,887 -1,177Other Sectors: Long-term 0 0 0 0 0Other Sectors: Short-term -2,818 -1,468 814 -1,247 -917

Liabilities 19,173 1,257 10,214 5,653 2,049General Government 1,579 -100 -36 932 783Banks 16 -2,043 586 944 529Other Sectors: Long-term 2,385 442 2,980 -189 -848Other Sectors: Short-term 15,193 2,958 6,684 3,966 1,585

Reserve Assets -6,603 1,901 2,505 -5,416 -5,593Monetary Gold 0 0 0 0 0Special Drawing Rights -15 -4 -4 -4 -3Reserve Position in the Fund 231 0 60 78 93Foreign Exchange -6,819 1,905 2,449 -5,490 -5,683Other Claims 0 0 0 0 0

III NET ERRORS AND OMISSIONS 11,481 5,619 -2,696 3,767 4,791

204

Statistical Tab

lesA

nnual Rep

ort 2006-07

Table 4.1(a): Gross Domestic Product by Industry Group at Current Basic Prices


(Rs million)

INDUSTRY GROUP 2004 2005 2006 1 2007 1

1. Agriculture, Hunting, Forestry and Fishing 9,830 9,790 10,130 9,785

of which: Sugarcane (5,261) (5,212) (5,137) (4,571)

2. Mining and Quarrying 87 88 101 96

3. Manufacturing 31,942 32,187 36,356 41,060

of which: Manufacturing industries previously operating with an EPZ certificate (13,140) (12,108) (13,694) (15,584)

4. Electricity, Gas and Water 3,546 3,355 3,521 3,674

5. Construction 8,835 9,099 10,205 13,145

6. Wholesale and Retail Trade; Repair of Motor Vehicles,Motorcycles, Personal and Household goods 17,327 19,571 22,534 25,598

7. Hotels and Restaurants 11,296 12,423 15,500 19,517

8. Transport, Storage and Communication 19,682 20,447 22,173 24,826

9. Financial Intermediation 14,875 16,766 18,850 21,607

10. Real estate, Renting and Business Activities 14,679 16,609 19,026 22,539

11. Public Administration and Defence; Compulsory Social Security 10,580 11,460 12,199 12,674

12. Education 7,087 7,780 8,440 9,136

13. Health and Social Work 5,087 5,580 6,266 6,824

14. Other Services 5,390 6,007 6,784 7,981

15. Financial Intermediation Services Indirectly Measured (FISIM) -7,818 -8,991 -10,117 -11,528

Gross Domestic Product at basic prices 152,425 162,171 181,968 206,934

Taxes on products (net of subsidies) 23,172 23,177 24,319 28,549

Gross Domestic Product at market prices 175,597 185,348 206,287 235,483

Net Primary Income from the rest of the world -390 -239 +1,633 +7,491

Gross National Income at market prices 175,207 185,109 207,920 242,974

205

Annual R

eport 2006-07

Statistical Tab

les

Table 4.1(b): GDP - Sectoral Real Growth Rates: 2004 - 2007


(Per cent)

2004 2005 2006 1 2007 1

1. Agriculture, Hunting, Forestry and Fishing +8.1 -5.4 +0.6 -7.4

of which: Sugarcane +10.6 -9.2 -2.9 -13.6

2. Mining and Quarrying +0.4 -3.6 +9.1 -9.1

3. Manufacturing +0.6 -5.5 +4.0 +2.2

of which: Textile -7.2 -14.7 +2.9 +8.5

4. Electricity, Gas and Water +4.0 +3.8 +4.0 +3.1

5. Construction +0.5 -4.4 +5.2 +15.2

6. Wholesale and Retail Trade; Repair of Motor Vehicles,

Motor Cycles, Personal and Household Goods +5.7 +5.6 +5.5 +4.5

of which: Wholesale and Retail Trade +5.5 +5.5 +5.4 +4.4

7. Hotels and Restaurants +2.4 +5.6 +3.5 +14.0

8. Transport, Storage and Communication +8.1 +7.7 +7.4 +7.9

9. Financial Intermediation +4.3 +5.4 +7.0 +7.5

10. Real Estate, Renting, and Business Activities +6.7 +6.5 +6.3 +7.5

of which: Owner occupied dwellings +5.3 +4.8 +4.4 +4.9

11. Public Administration and Defence; Compulsory Social Security +4.3 +5.3 +4.0 +0.5

12. Education +6.4 +6.1 +4.1 +2.5

13. Health and Social Work +7.0 +6.2 +7.9 +4.6

14. Other Services +7.6 +7.2 +6.5 +8.0

Gross Domestic Product at basic prices +4.8 +2.3 +5.0 +5.4

206

1. Agriculture, Hunting, Forestry

and Fishing -5.4 +0.6 -7.2 -8.1 -7.3 -0.3 +1.1 +4.0 +2.9 -4.0 -10.1 -10.9

of which: Sugarcane -9.2 -2.9 -9.2 -9.2 -9.2 -9.2 -2.9 -2.9 -2.9 -2.9 -13.6 -13.6

2. Mining and Quarrying -3.6 +9.1 +7.7 +9.1 -9.7 -16.1 +7.9 +0.7 +26.3 +2.6 -8.0 -3.6

3. Manufacturing -5.5 +4.0 -11.0 -6.0 -3.9 -1.8 +5.9 +2.7 +4.1 +3.8 +0.5 +3.9

of which: Textile -14.7 +2.9 -21.0 -16.3 -13.3 -8.1 -0.1 -1.1 +6.2 +6.5 +7.2 +12.0

4. Electricity, Gas and Water +3.8 +4.0 +1.5 +2.5 +6.6 +5.2 +3.7 +5.3 +5.7 +1.6 +1.4 +1.9

5. Construction -4.4 +5.2 -2.8 -9.6 -4.3 -0.3 -1.3 +0.9 +10.2 +10.7 +30.2 +17.9

6. Wholesale and Retail Trade; Repair

of Motor Vehicles, Motor Cycles,

Personal and Household Goods +5.6 +5.5 -1.6 +8.2 +9.5 +5.5 +19.9 +7.6 -1.5 +0.2 -5.3 -0.2

of which: Wholesale and Retail Trade +5.5 +5.4 -2.1 +8.3 +9.5 +5.3 +20.6 +7.6 -1.9 0.0 -6.1 -0.5

7. Hotels and Restaurants +5.6 +3.5 +6.5 +2.4 +5.2 +7.2 +6.1 -0.2 +3.2 +4.1 +15.1 +22.7

8. Transport, Storage and Communication +7.7 +7.4 +7.8 +9.7 +7.4 +6.3 +8.5 +5.8 +5.8 +9.3 +6.8 +8.1

9. Financial Intermediation +5.4 +7.0 +1.3 +4.2 +8.7 +7.5 +4.5 +4.2 +8.0 +11.1 +11.9 +6.6

10. Real Estate, Renting, and Business

Activities +6.5 +6.3 +6.1 +6.3 +6.4 +7.0 +6.3 +6.8 +5.8 +6.1 +5.3 +8.5

of which: Owner occupied dwellings +4.8 +4.4 +4.9 +4.7 +4.8 +4.9 +4.5 +4.5 +4.4 +4.4 +2.1 +6.9

11. Public Administration and Defence;

Compulsory Social Security +5.3 +4.0 +4.4 +5.0 +7.8 +4.2 +4.1 +4.0 +0.1 +7.8 -0.7 +2.9

12. Education +6.1 +4.1 +6.3 +7.7 +4.6 +6.1 +3.6 +3.5 +3.7 +5.6 +3.2 +3.1

13. Health and Social Work +6.2 +7.9 +7.8 +7.2 +4.5 +5.4 +7.0 +13.0 +4.5 +6.8 +5.8 +2.1

14. Other Services +7.2 +6.5 +5.3 +5.9 +6.9 +10.3 +8.6 +7.7 +5.4 +5.0 +8.0 +8.5

Gross Domestic Product atbasic prices +2.3 +5.0 +0.4 +1.7 +3.4 +3.8 +7.1 +4.6 +3.9 +5.2 +4.4 +5.7


2006 Q2 Q4 Q2 Q4 Q2 12005 Q1 Q3 Q1 Q3 Q1 1

Table 4.1(c): GDP - Quarterly Sectoral Real Growth Rates (over corresponding period of previous year): Q1 2005 - Q2 2007(Per cent)

Annual growth rate 2005 1 2006 1 2007

Statistical Tab

lesA

nnual Rep

ort 2006-07

207

Annual R

eport 2006-07

Statistical Tab

les

Compensation of Employees 64,378 68,877 74,572 83,715

of which: General Government (16,660) (17,826) (18,819) (19,431)

Taxes (net of subsidies) on production and imports 24,733 24,781 26,061 30,656

Gross Operating Surplus 86,486 91,690 105,654 121,112


Table 4.2: Distribution of Gross Domestic Product at Current Prices

2004 2005 2006 1 2007 1

(Rs million)

Table 4.3: Expenditure on Gross Domestic Product at Current Prices

2004 2005 2006 1 2007 1

(Rs million)

Private Consumption Expenditure on Goods and Services 111,837 127,349 145,491 165,790

General Government Consumption Expenditure

on Goods and Services 25,043 27,368 29,355 30,743

Gross Domestic Fixed Capital Formation by Private Sector 26,345 27,973 34,177 46,261

Gross Domestic Fixed Capital Formation by Public Sector 11,658 11,758 15,871 12,909

Change in Stocks +4,879 +2,027 +4,694 +3,461

Consumption and Gross Capital Formation 179,762 196,475 229,588 259,164

Net Export of Goods and Non-factor Services -4,165 -11,127 -23,301 -23,681




208

Statistical Tab

lesA

nnual Rep

ort 2006-07

A. By Type of Capital Goods

(a) Residential Building 7,620 7,911 7,628 8,972 10,579

(b) Non-residential Building 7,967 10,174 9,627 10,666 17,794

(c) Other Construction Work 6,154 4,957 6,234 7,067 6,530

(d) Transport Equipment

(i) Passenger Car 1,813 2,580 2,327 2,497 3,406

(ii) Other Transport Equipment 2,838 1,729 1,866 7,620 4,948

(e) Other Machinery and Equipment 9,162 10,652 12,049 13,226 15,913

GROSS DOMESTIC FIXED CAPITAL FORMATION 35,554 38,003 39,731 50,048 59,170

B. By Industrial Use

(a) Agriculture, Hunting, Forestry and Fishing 953 1,328 2,225 2,764 2,508

(b) Mining and Quarrying 1 2 0 1 9

(c) Manufacturing 4,109 5,346 5,548 4,819 8,375

(d) Electricity, Gas and Water 1,809 1,783 2,750 3,251 2,131

(e) Construction 610 744 699 938 1,589

(f) Wholesale and Retail Trade; Repair of Motor Vehicles, 2,487 2,489 2,736 2,989 4,819Motorcycles, Personal and Household goods

(g) Hotels and Restaurants 3,227 5,185 4,193 6,558 10,127

(h) Transport, Storage and Communication 5,626 4,067 4,542 10,566 8,641

(i) Financial Intermediation 789 945 1,336 1,665 1,436

(j) Real Estate, Renting and Business Services 9,389 10,005 9,509 10,534 13,627of which: Ownership of Dwellings (7,620) (7,911) (7,628) (8,972) (10,579)

(k) Public Administration and Defence; Compulsory Social Security 2,175 2,495 1,975 2,077 1,777

(l) Education 1,241 1,167 1,326 1,002 1,106

(m) Health and Social Work 581 693 543 594 765

(n) Other Services 2,557 1,754 2,349 2,290 2,260

GROSS DOMESTIC FIXED CAPITAL FORMATION 35,554 38,003 39,731 50,048 59,170

Table 4.4: Gross Domestic Fixed Capital Formation at Current Prices by Type and Use


2003 2004 2005 2006 1 2007 1

(Rs million)

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Table 4.5: Labour productivity and Unit Labour Cost

Economy 79.2 83.5 87.0 90.8 91.7 100.0 103.6 105.4 108.6 112.9 114.9 118.6

Manufacturing Sector 80.1 84.7 86.5 88.3 90.7 100.0 105.4 105.8 109.6 116.3 114.5 118.2

EPZ Sector 82.3 87.8 89.0 90.3 94.1 100.0 103.0 102.8 103.5 107.8 103.4 109.0

Note: Manufacturing Sector includes large establishments only.Source: Central Statistics Office, Government of Mauritius.

LABOUR PRODUCTIVITY INDEX

(Base Year 2000 = 100)

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

UNIT LABOUR COST INDEX

(Base Year 2000 = 100)

Economy 83.9 87.1 88.5 93.9 100.2 100.0 103.0 108.5 115.0 120.2 125.7 129.3

Manufacturing Sector 82.7 83.3 84.7 90.8 99.3 100.0 103.3 110.7 115.2 119.9 130.7 129.7

EPZ Sector 81.2 81.7 82.1 89.3 98.7 100.0 105.1 115.4 123.0 126.7 143.5 140.6

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

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Table 4.6: Sugar Production and Yields

1979 203 189 6,313 37.3 28.8 22.5 33.4 688 3.65 10.9

1980 188 188 4,564 27.0 21.1 16.2 24.3 475 2.54 10.4

1981 201 185 5,303 32.8 23.2 20.6 28.6 575 3.10 10.8

1982 201 189 6,582 38.4 30.8 24.2 34.8 688 3.63 10.5

1983 200 186 5,255 32.2 23.9 20.2 28.2 605 3.25 11.5

1984 199 185 5,009 31.7 22.1 18.4 27.1 576 3.11 11.5

1985 197 185 5,583 33.8 21.4 26.3 30.2 646 3.48 11.6

1986 197 184 6,025 36.4 29.2 22.5 32.7 707 3.84 11.7

1987 196 184 6,231 37.5 30.6 23.6 33.9 691 3.78 11.1

1988 196 182 5,517 35.8 24.9 20.4 30.3 634 3.76 11.5

1989 196 182 5,436 34.1 25.5 18.4 29.6 568 3.10 10.5

1990 196 181 5,548 36.3 25.2 18.1 30.7 624 3.46 11.3

1991 194 180 5,621 37.8 24.3 21.5 31.2 611 3.39 10.9

1992 192 179 5,780 37.4 27.0 20.3 32.3 643 3.59 11.1

1993 188 176 5,402 34.7 26.5 20.4 30.8 565 3.22 10.5

1994 184 173 4,813 31.5 24.1 15.6 27.8 500 2.89 10.4

1995 182 171 5,159 33.6 27.0 18.2 30.2 540 3.16 10.5

1996 182 170 5,260 34.7 27.4 20.0 30.9 588 3.46 11.2

1997 186 172 5,787 36.5 30.6 21.4 33.5 621 3.60 10.7

1998 185 175 5,781 36.4 29.6 23.6 33.0 629 3.59 10.9

1999 187 172 3,883 28.0 18.1 16.7 22.6 373 2.17 9.6

2000 182 173 5,110 33.9 25.5 21.5 29.5 569 3.29 11.15

2001 181 173 5,792 37.3 29.9 24.5 33.5 646 3.73 11.15

2002 179 171 4,874 32.7 25.7 19.8 28.5 521 3.05 10.70

2003 176 168 5,199 34.5 28.8 21.1 30.9 537 3.19 10.34

2004 173 165 5,280 35.4 29.9 20.2 32.0 572 3.47 10.85

2005 170 162 4,984 34.6 28.4 20.2 30.8 520 3.21 10.44

2006 1 168 158 4,749 33.7 27.8 19.3 30.0 505 3.19 10.64

Crop Total Area Total Cane Sugar Average SugarYear under Area Produced Miller Owner Tenant Average Produced Yield of Recovered

Cultivation Harvested Planters Planters Planters Island Sugar perarpent

(Thousands of arpents) (Thousands of (Metric tonnes) (Thousands of (Metric (Per centmetric tonnes) metric tonnes) tonnes) of cane)

Yield of Cane per arpent

1 Provisional.Source: Annual Reports, Mauritius Chamber of Agriculture.

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Table 4.7: Sugar Production and Disposal

1 Figures for available supplies are net of closing special ISA stocks.2 Figures for stocks include special ISA stocks (wherever applicable). The effects of loss or surplus in storage are also accounted for in closing stocks.3 Relates to price received for export and domestic sales of sugar produced in the crop year, net of all marketing expenses, taxes and levies, and after

deducting Sugar Insurance Fund premium.4 Includes 31.0 thousand metric tonnes of imported sugar. 10 Includes 23.2 thousand metric tonnes of imported sugar.5 Includes 38.0 thousand metric tonnes of imported sugar. 11 Includes 40.7 thousand metric tonnes of imported sugar.6 Includes 38.2 thousand metric tonnes of imported sugar. 12 Includes 42.0 thousand metric tonnes of imported sugar.7 Includes 35.8 thousand metric tonnes of imported sugar. 13 ncludes 38.3 thousand metric tonnes of imported sugar.8 Includes 38.5 thousand metric tonnes of imported sugar. 14 Includes 40.9 thousand metric tonnes of imported sugar.9 Includes 20.0 thousand metric tonnes of imported sugar.Source: Mauritius Sugar News Bulletin and Annual Reports, Mauritius Chamber of Agriculture.

Calendar Stock at Production Total Local Exports Stock Average PriceYear Beginning Availability 1 Consumption at End Ex-Syndicate 3

of Year of Year 2 (Rs per tonne)

1979 278.7 688.4 953.3 38.5 604.3 342.0 2,1261980 324.0 475.5 799.5 36.7 617.3 141.2 2,3051981 141.2 574.5 715.7 37.6 432.2 244.8 2,6951982 244.8 687.9 907.3 35.4 596.8 275.0 2,8481983 275.0 604.7 879.7 36.5 608.0 234.6 2,9811984 234.6 575.6 810.2 38.0 530.7 267.3 3,5561985 267.3 645.8 913.1 36.9 539.5 336.9 3,8291986 336.9 706.8 1,043.7 37.7 624.9 380.6 4,1691987 380.6 691.1 1,071.7 38.6 656.3 377.5 4,7651988 377.5 634.2 1,011.7 38.1 652.5 320.9 5,3541989 320.9 568.3 889.2 37.4 636.2 215.3 6,4801990 215.3 624.3 839.6 38.7 578.0 223.0 6,6861991 223.1 611.3 834.4 40.1 551.4 242.3 6,8491992 242.3 643.2 885.5 38.8 598.0 247.8 7,0191993 247.6 565.0 812.7 37.1 540.0 236.7 8,0301994 234.4 500.2 734.6 36.9 518.8 177.7 9,3061995 177.7 539.5 737.2 4 37.2 523.9 175.5 10,3091996 175.5 588.5 795.0 4 38.1 612.5 143.1 11,1331997 143.1 620.6 801.7 5 39.7 575.3 185.7 10,8491998 185.7 628.6 852.4 6 40.2 602.1 209.6 12,0871999 209.6 373.3 618.7 7 40.0 534.3 43.3 10,6052000 43.3 569.3 651.1 8 39.2 424.3 187.3 10,5512001 187.3 645.6 852.0 9 36.9 543.7 272.1 11,7482002 272.1 520.9 756.1 10 40.1 570.8 144.9 12,5612003 144.9 537.2 722.8 11 41.3 517.5 163.4 13,7002004 163.4 572.3 777.8 12 40.0 551.0 185.9 14,6932005 185.9 519.8 744.1 13 39.4 539.4 165.1 15,9462006 165.1 504.9 710.9 14 39.5 542.1 129.2 16,257

(Thousands of metric tonnes)

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Table 4.8: Production of Selected Commodities(Metric tonnes)

1 Provisional. 2 Crop year. 3 Comprises abattoir slaughters only. 4 Wet weight equivalent. Source: Central Statistics Office, Government of Mauritius.

1998 1999 2000 2001 2002 2003 2004 2005 2006 1

Industrial Crops 8,094 7,802 7,003 7,996 7,355 7,399 7,586 7,094 7,947

Tea (production of green leaf) 7,393 7,134 6,440 7,440 6,870 6,973 7,229 6,798 7,649

Tobacco 2 701 668 563 556 485 426 357 296 298

Foodcrop Production 91,618 85,747 114,484 129,119 103,876 103,455 111,633 96,782 106,902

Banana 9,343 7,550 8,500 11,000 7,200 12,090 12,000 11,580 11,347

Beans and Peas 1,896 1,301 1,715 2,006 2,242 2,022 2,138 1,608 1,487

Beet 332 658 1,794 2,304 1,736 911 1,125 935 1,174

Brinjal 2,237 1,713 2,160 2,721 2,359 2,097 2,819 2,074 2,839

Cabbage 6,283 8,206 10,823 11,663 8,252 6,279 6,522 4,766 4,547

Carrot 3,363 6,127 11,461 12,030 8,650 5,048 5,841 3,934 4,316

Chillies 1,060 795 905 1,031 826 1,056 1,322 1,161 1,512

Cucumber 4,573 4,187 6,046 6,426 5,675 6,713 6,938 4,907 6,866

Groundnut 551 341 408 323 284 893 610 231 390

Lettuce 1,878 1,223 1,716 2,399 2,214 1,988 1,883 1,659 1,562

Maize 260 201 623 389 295 177 369 475 452

Onion 6,727 9,066 11,134 10,950 7,117 4,183 4,682 5,637 4,550

Pineapple 1,462 1,014 3,416 6,016 1,917 4,562 4,490 4,885 5,554

Potato 14,612 15,322 13,843 16,350 13,339 12,359 11,246 12,777 14,522

Pumpkin 5,429 4,040 5,113 5,439 4,997 6,151 6,685 5,299 7,759

Squash 1,056 2,136 2,683 2,490 1,883 1,827 1,987 1,263 861

Tomato 10,729 8,037 9,719 12,395 11,738 13,247 14,400 12,840 14,671

Other Foodcrops 14,993 12,305 19,573 20,164 20,699 19,673 22,768 17,646 19,976

Total 99,712 93,549 121,487 137,115 111,231 110,854 119,219 103,876 114,849

Total Area Under Production (Hectares) 6,995 6,059 7,357 7,918 7,262 7,228 7,553 6,901 7,207

Livestock and Fisheries

Beef 3 2,516 2,575 2,538 2,248 2,428 2,505 2,456 2,484 2,187

Goat Meat 3 112 116 86 74 100 97 89 104 96

Mutton 3 6 9 16 40 14 11 18 7 3

Pork 3 752 678 891 882 756 784 743 709 681

Fish 4 9,835 10,572 7,842 8,794 9,314 9,449 9,430 8,982 8,623

213

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Table 4.9: Electricity - Production and Consumption

Plant Capacity Kilowatt 480,360 522,260 614,960 622,460 622,060 622,060 621,160 651,160 679,940

of which:

Hydro (CEB) Kilowatt 59,440 59,440 59,440 59,440 59,440 59,440 59,440 59,440 59,440

Thermal (CEB) Kilowatt 288,520 317,520 348,520 348,520 348,520 348,520 348,520 348,520 372,800

Energy Generated Gigawatthour 1,108.1 1,078.8 963.8 946.9 968.4 1,110.5 1,198.1 1,179.5 1,075.3

Hydro Gigawatthour 104.2 29.5 95.3 70.4 85.6 117.7 122.3 114.9 76.6

Thermal Gigawatthour 1,003.9 1,049.3 868.5 876.5 882.8 992.8 1075.8 1064.6 998.7

Energy Purchased from Sugar

and Other Factories Gigawatthour 257.0 343.7 601.2 710.2 746.7 729.4 725.1 835.4 1,015.7

Sale of Energy Gigawatthour 1,176.4 1,229.2 1,358.5 1,449.8 1,491.7 1,607.1 1,682.1 1,752.2 1,855.6

Number of Consumers 293,887 304,029 313,963 323,213 330,005 338,563 346,990 357,404 365,408

Domestic 261,971 271,061 279,886 288,324 294,666 302,387 310,078 319,075 325,830

Commercial 24,914 25,730 26,915 27,655 28,054 28,797 29,552 30,866 32,060

Industrial 6,342 6,419 6,531 6,624 6,662 6,681 6,629 6,710 6,729

Other 660 819 631 610 623 698 731 753 789

Source: Annual Reports and Accounts, Central Electricity Board; Digest of Industrial Statistics, Central Statistics Office, Government of Mauritius.

Unit 1998 1999 2000 2001 2002 2003 2004 2005 2006

214

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Table 5.1: Consumer Price Indices 1

MONTH 2002 2003 2004 2005 2006 2007

January 133.5 105.5 109.7 116.1 123.1 133.9

February 134.7 105.7 110.1 116.7 123.5 134.9

March 135.4 105.6 110.1 117.1 124.2 136.1

April 135.7 105.8 110.4 117.1 124.0 137.5

May 135.9 106.5 110.7 117.2 124.3 138.1

June 135.9 106.9 111.3 117.3 126.2 138.8

July 103.1 107.5 112.5 118.0 129.9

August 103.6 107.4 112.7 118.0 130.9

September 104.0 107.9 113.1 117.3 131.7

October 105.0 108.3 114.6 118.2 132.3

November 104.9 108.4 114.7 118.8 133.3

December 104.8 108.9 115.0 119.5 133.7

Average 136.8 2 107.0 112.1 117.6 128.1

Yearly Change (Per cent) +6.4 +3.9 +4.7 +4.9 +8.9

1 From July 1997 to June 2002, the base period was July 1996 to June 1997=100. A new base period (July 2001 to June 2002=100) has been introduced as from July 2002.2 Average computed after converting CPI data from July to December 2002 to previous base period July 1996 to June 1997=100.Source: Central Statistics Office, Government of Mauritius.

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Table 6.1: External Debt (Rs million)

End-June Government Public Corporations

(Government-Guaranteed)

Public Corporations

(Non-Guaranteed)

Private Sector

TOTAL

2003 9,074 10,312 7,317 2,271 28,974

2004 8,445 9,208 6,013 1,953 25,619

2005 9,232 9,202 5,463 2,170 26,067

2006 8,535 11,068 4,635 2,058 26,296

2007 13,452 8,272 3,601 1,562 26,886

Note: Government external debt includes foreign investment in Government securities. Source: Ministry of Finance and Economic Development, Government of Mauritius.

217

Annual Report 2006-07 Board of Directors

Mr Rundheersing Bheenick, Governor and Chairperson

Mr Yandraduth Googoolye, First Deputy Governor

Dr Ahmad Jameel Khadaroo, Second Deputy Governor

Mr Assen Ally Abdool Raman Sohawon, Director

Mr Darmalingum Aroumageri Moodely, Director

Mr Mohunlall Ramphul, Director

Mr Shyam Razkumar Seebun, Director

Mr Jacques Tin Miow Li Wan Po, Director

Mr Jean George Archimede Lascie, Director

Appendix II Board of Directors as at 30 June 2007

218

Monetary Policy Committee Annual Report 2006-07

Appendix III Monetary Policy Committee

Members

Mr Rundheersing Bheenick, Governor of the Bank of Mauritius and Chairperson

Mr Yandraduth Googoolye, First Deputy Governor

Dr Ahmad Jameel Khadaroo, Second Deputy Governor

Mr Jacques Tin Miow Li Wan Po, Board Director of the Bank of Mauritius

Mr Shyam Razkumar Seebun, Board Director of the Bank of Mauritius

Mr Jagnaden Padiaty Coopamah, External Member

Mr Pierre Dinan, External Member

Observers

Professor Stefan Gerlach, Head of Secretariat of the Committee on the Global Financial

System at the Bank for International Settlements, Basel, Switzerland

Mr Hemraz Oopuddhye Jankee, Director-Research, Bank of Mauritius

Dr Streevarsen Narrainen, Senior Economic Adviser, Ministry of Finance and Economic

Development

219

Annual Report 2006-07 Senior Managements Officials

Governor Rundheersing BheenickFirst Deputy Governor Yandraduth GoogoolyeSecond Deputy Governor Dr Ahmad Jameel Khadaroo

ADMINISTRATION DEPARTMENT

Secretary Hemlata Sadhna Sewraj-Gopal (Mrs)

RESEARCH DEPARTMENT

Director-Research Hemraz Oopuddhye JankeeAssistant Director-Research Radhakrishnan SoobenAssistant Director-Research Mahendra Vikramdass PunchooAssistant Director-Research (Statistics) Jitendra Nathsing Bissessur

ACCOUNTING, BUDGETING AND PAYMENT SYSTEMS DEPARTMENT

Assistant Director Jayendra Kumar Ramtohul

BANKING AND CURRENCY DIVISION

Head - Banking and Currency Division Daneshwar Doobree

FINANCIAL MARKETS DEPARTMENT

Assistant Director Jaywant PandooAssistant Director Marjorie Marie Agnès Heerah-Pampusa (Mrs)

INFORMATION TECHNOLOGY DEPARTMENT

Assistant Director Ng Cheong José Li Yun Fong

SUPERVISION DEPARTMENT

Assistant Director Ramsamy Chinniah

LEGAL SECTION

Assistant Director Mardayah Kona Yerukunondu

AUDIT OFFICE

Manager Yuntat Chu Fung Leung

Appendix IV Senior Management Officials

220

Organisation Chart Annual Report 2006-07

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221

Annual Report 2006-07

List of Banks, Non-Bank Deposit-Taking Institutions, Money-Changersand Foreign Exchange DealersLicensed by the Bank of Mauritius

The following is an official list of banks holding a Banking Licence, institutions other than banks which are

licensed to transact deposit-taking business and cash dealers licensed to transact the business of money-

changer or foreign exchange dealer in Mauritius and Rodrigues as at 30 June 2007.

Banks Licensed to carry Banking Business

1. Bank of Baroda

2. Banque des Mascareignes Ltee

3. Barclays Bank PLC

4. Deutsche Bank (Mauritius) Limited

5. First City Bank Ltd

6. Habib Bank Limited

7. HSBC Bank (Mauritius) Limited

8. Indian Ocean International Bank Limited

9. Investec Bank (Mauritius) Limited

10. Mauritius Post and Cooperative Bank Ltd

11. P.T Bank Internasional Indonesia

12. SBI International (Mauritius) Ltd.

13. SBM Nedbank International Limited1

14. South East Asian Bank Ltd

15. Standard Bank (Mauritius) Limited

16. Standard Chartered Bank (Mauritius) Limited

17. State Bank of Mauritius Ltd

18. The Hongkong and Shanghai Banking Corporation Limited

19. The Mauritius Commercial Bank Ltd.

Non-Bank Deposit-Taking Institutions

1. ABC Finance & Leasing Ltd.

2. Barclays Leasing Company Limited

3. Capital Leasing Ltd

4. Finlease Company Limited

5. Cim Leasing Ltd

6. Global Direct Leasing Ltd

Appendix VI

222

Annual Report 2006-07

7.La Prudence Leasing Finance Co. Ltd

8.Mauritius Housing Company Ltd

9.Mauritian Eagle Leasing Company Limited

10.SBM Lease Limited

11.SICOM Financial Services Ltd

12.The Mauritius Civil Service Mutual Aid Association Ltd

13.The Mauritius Leasing Company Limited

Money-Changers (Bureaux de Change)

1. Change Express Ltd.

2. Max & Deep Co. Ltd

3. Gowtam Jootun Lotus Ltd 2

Foreign Exchange Dealers

1. British American Exchange Co. Ltd

2. Edge Forex Limited

3. Rogers Investment Finance Ltd

4. Thomas Cook (Mauritius) Operations Company Limited

5. Shibani Finance Co. Ltd

1 SBM Nedbank International Limited had ceased all banking activities as from 28 February 2007.

2 The Bank has suspended the Licence granted to Gowtam Jootun Lotus Ltd to carry on the business of

money-changer with effect from 26 January 2006.

annual report 2006-07 - bom.mu · pdf fileappendix v organisation chart ... action as new...

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