Despite all dire predictions, our tourist arrivals have kept increasing year after year. It is said that tourist income receipts have come down from Rs 44 billion in 2012 to Rs 40 billion in 2013.
We may interprete the lower figure of receipts for 2013 as a negative factor; some have indeed speculated that because we had more tourists in 2013 but lower total income from them, that would mean that average spending per tourist has declined compared with the preceding year.
This may not be true unless we have the facts. Suppose that the hotels which have hosted those tourists have not brought in all their earnings into the country through our banking system. In that case, the receipts are actually under-reported because part of tourist receipts may have been retained overseas and there may be plenty of reasons for so doing.
What must actually call our attention is that the number of tourists visiting the country has not decreased. Taking this as a departure point, we should have analysed why, despite the not-so-brilliant conditions in our traditional tourist markets, there has been a growth in the numbers due perhaps to tapping unconventional markets such as China. It is here that a country like Mauritius would have to develop its cutting edge. By analysing the reasons for the uptake on the market, we could drive an agenda to push up the factors contributing to positive growth.
It is by going persistently in this direction that we can break new grounds and conquer our faltering spirits each time something or other does not work up exactly to our expectations. It is the attitude to adopt for the future if we do not want to stagnate and cling to customary ways of doing business.
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Putting Emphasis on the Correct Parameters
It has become an annual ritual to compare the percentage of passes in the CPE exams each year in order to draw conclusions as to whether our education system is performing better than in the past. Percentages hide a number of details which, if correctly examined, may deny such conclusions.
For example, have those who passed this year achieved higher standards of excellence in those subjects (science, maths and international languages) which matter to shaping up our future? Is this achievement sustained in after-years of education at the next higher level? If so, what are the mechanisms in place to ensure that the system is transforming itself in pace with what the requirements of the future will be? Questions such as these have greater significance than merely drawing satisfaction from generalities.
Consider the case of Detroit, an American city in the state of Michigan. This city was for a long stretch of time the heartland of America’s thriving car industry and a home of prosperity to which swathes of Americans migrated in quest of fulfilment. General Motors, Ford and Chrysler had made it a hub for their national and international production. Not only did it not diversify into other branches of activity so automobile-centric it became. It also did not build the support structures for this diversification to work its way up.
Notably, unlike other centres of manufacturing which held out against economic assaults by becoming ever more ingenious and productive, Detroit stuck to its automobile advantage until this was no longer sustainable. Millions lost their jobs as business migrated in pursuit of comparative advantage to the southern US, Canada and Mexico, let alone the battering the automobile industry received at the hands of German and Japanese competitors.
There was a constant need to practice the trade on an ever-renewed basis and keeping in touch with the latest market trends imposed by evolving technology. Not surprisingly, Detroit was unable to raise the taxes necessary to pay employment benefits, pensions and meet other recurrent municipal charges. In July 2013, it was declared bankrupt with an outstanding debt of $18 billion and rising.
It is important to note that other centres of activity (not only in the US) thrived where Detroit failed because they invested all along in research and development by supporting key tertiary educational establishments which grew symbiotically. The research outputs fed into the development of products quickly adapting successfully to the changing marketplace the world over. Has not the electronic tablet which has invaded marketplaces the world over leaped the barrier that was putting smartphones of the past decades out of business? Why? One cannot hope to overcome handicaps by staying put. There is a need to change by constantly adapting to market demands.
Those who adapt faster are the ones who successfully maintain themselves in business. This horizon has nothing to do with the rate of pass scored at the CPE level. It obeys global parameters in markets that increasingly become indistinguishable from each other over time.
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What the Future holds in store
Remarks are frequently made to the effect that the rate of growth of our private investment has slowed and that this means the potential for our economy to register higher rates of growth and employment is not so great. This may be true but what we needed to do was to find out what must be done at the local level to lift up the level of private investment, not to use it as a manner of reproach against those who usually do this kind of investment in the private sector.
Thanks to the digital revolution, markets the world over are redefining themselves. Many have already done so with the result that if we wanted to produce the same things, we would have to climb up to their levels. As changes take place continuously especially so in the richer countries of the world, our production will have to be tailored to adapt to all of this. We will produce for our markets quite differently from the way it has been done in the past. Have we not done this kind of transformation of our production processes if only in sugar and textile production? We have to carry on in the same way. This time however we have to make a quantum jump since technology has in various cases bypassed us and left us behind. Were we to fill this gap quickly enough, our private investment would also earn its chance to increase, to meet new markets and to process things we’ve never done before.
Anyone will observe that this requires a paradigm shift in our research, training and development. It is going to be a very pragmatic quantum jump to catch up with the new marketplace of the future. We cannot remain consumers for long. We have to shift towards becoming producers of substance for global markets and not necessarily for markets we are used to. All this requires daring and putting into practice things we’ve not even imagined as being within our realm of possibilities. We can do so, even if it is somewhat late in the hour.
* Published in print edition on 24 January 2014