How the past 60 years shaped the nation and what more can be done

In 1954, Mauritius was struggling to find expression. It was a colonial society. The majority of the people lived in dire poverty, but there was a strong urge to break away. The cyclone which flattened habitations and plantations in 1960 provided a measure of the degree of vulnerability people were exposed to in those days. It is in this environment of low-level development and bleak prospects that voices rose in favour of a more just and fair society, led by social and political establishments.

One of the means people had to make their voices heard was the media (which consisted of the local radio station and newspapers), with a newspaper tradition that Mauritius had nurtured since long. It is in this deep-rooted tradition of freedom of expression, which was permitted by our British colonial masters, that a wide diversity of opinions took firm roots among the population.

In this midst, Mauritius Times was born under the initiative of a few well-wishers of those members of the population who were the most economically and socially oppressed. Defence of this category (the majority) of the population was also strongly anchored in the political philosophy of the Mauritius Labour Party (Labour). Not only did people not find a way out of their economic alienation. Even things like access to education were reserved for the select few. It seemed the pool from which it was sought to draw up talent was being deliberately limited, to the exclusion of others who had proved, whenever given the opportunity, that they were not devoid of talent.

It is no coincidence therefore that Mauritius Times and Labour waged the same battle for popular emancipation, greater social justice and a more widely-embracing development. In the process, the implied loss or reduction of privileges of those who had been customarily empowered, led to extensive polemics among right wing and left wing newspapers for every inch of progress made towards establishing a fairer society. The extensive discussion in the columns of newspapers with divergent ideologies brought to the surface novel ideas which helped chart the course for a more inclusive society.

Social shifts that have actually taken place the past 60 years towards a society more just towards all and less inegalitarian, show that this battle has not been delivered in vain. Much more remains to be done. For example, the communal cracks which were entrenched when the elections for independence came in 1967, still prevent the social integration that Mauritius deserves to make headway into a global economy which rewards those who keep pace with international competition. The goal no doubt should be to embrace all in comprehensive social and economic progress. This means the battle for the best ideas should continue.

Let’s take a look at how the economy changed during this time and what direction we should take to remain in full future preparedness to face challenges. We can learn from the past.

The Seeds of Progress

Mauritius was able to make an economic breakthrough from the agrarian model on which it was relying so far once it adopted outward-orientedness as a new plank of economic policy in the 1970s and 1980s. So far, the volatility of international sugar prices had acted as a brake on upward social and economic mobility.

This breakthrough was made possible with the advent of foreign investors in our emerging textile and other manufacturing export sector. This drive to export more caused our trade to GDP ratio (imports + exports of goods to GDP) to jump above 100% as from the late 1970s. It was clear that for a country that had no vast internal economic hinterland, nor mature enough regional economies with which it could tie up its economic fortunes, we had to go full force to expand our international trade. This is what the increasing trade to GDP ratio reflected and it was the right direction to take for a country in our position.

At first, a series of industrial unrests – and the associated social instability -threatened to stifle inflows of investments and hence the creation of additional jobs. Soon, however, public opinion was mobilized through the media and political devices to give the new spurt of growth of the economic base a chance of success. By 1987, some 90,000 workers were engaged in textile and garments and the economy could turn its sights to newer international adventures based on this policy of outward-orientedness.

Growth of other sectors picked up. Construction, wholesale and retail trade, tourism and offshore financial services expanded in the ensuing years. The growth of the country’s economic scope in this manner meant that the welfare state, which had compensated for the lack of economic opportunities in the pre-manufacturing years, became less of an absolute necessity than it had been before.

Setting the Agenda for the Future

More literacy and skills

One unfortunate fact about this newfound prosperity was that not all the constituents of the population did invest with equal vigour in the education and skills of their next generation. Even when they did, they did not pursue it beyond certain levels. This situation led to visible disparities in the social and economic success of the components of the population. Instead of letting it become a new element of discord, there is every reason why we should make efforts for all the boats to rise together with the tide.

This is not an insuperable problem, despite the slack that has come up. Previous generations of Mauritians have overcome steeper hurdles with even less means. With dedicated policies and the cooperation of one and all, a society acting with foresight should be able to raise the level-playing field more inclusively by focussing on the problem instead of just speaking about it ad infinitum. It is important to bear in mind that we are not really competing within ourselves. The world in which we evolve is setting higher standards of skills for individual nations to vie against. In such an external environment, we will stand to gain by beefing up as much of our inherent resources as possible.

A reliable governance structure

Countries which have English as their operating language and are cast in a solid frame of rule of law will succeed more than others; if their governments hold themselves accountable and are internationally reputed for their transparency and non-corruption, investors will come to them; they will take advantage of new economic openings if they also prize and embrace the latest technology on the production table. Such countries are the ones that will create the maximum space for their citizens to thrive economically. They will facilitate business by removing all manner of administrative and policy complications that set in otherwise and frighten away potential investors.

More exports

Figures show that somehow we did not cash as much as we could on our new diversified trade openings of the 1970s and the 1980s. The trade to GDP ratio that had gone beyond 100% as our exports surged, did not continue on that trend. It fell to 70% in 2013 and is estimated to stay in the same region with 75% in 2014. In other words, we haven’t been growing our exports of goods at the pace needed to entrench our outward orientedness.

Others who have embraced the same policy are much higher. Singapore’s trade to GDP ratio stands at 416%; that of Hong Kong at 393%. We cannot compare with their levels strictly but we should have acted to edge up our exports once the ratio started dipping by bringing in new export activities or giving the existing export sector the means to bounce back.

Preserving social capital

At the time Mauritius Times was started in 1954, there was a long-held belief in what was termed “social capital”, dating back from the days of Adam Smith (1759). This consisted of shared values and beliefs in a society that encourages individuals to assume responsibility for themselves and their families while trusting each other and working collaboratively to support each other.

In this construct, markets should not only be effective and impart globally dynamic support to the economy to give it intergenerational long-term perspective; they should also be seen to be fair. Unfortunately, “social capital” has been eroded with the onset of a new “market fundamentalism” of more recent times. Decision-makers have given away too much of their discretion and put trust instead in the power of the market to deliver socially desirable outcomes. This is the sort of laissez-faire that brought in its wake the international financial and economic crisis of 2007-08, throwing millions of workers out of jobs, deprived of social support in their moment of need and off-kilter.

Even economies such as China which have recorded phenomenal rates of economic growth in the previous decade have created enormous tensions due to the gaping inequalities and corruptions they have spawned simultaneously.

Insulating ourselves from systemic downturns

So what do we do? Had there been a long-term vision, many factors would have remained under control and helped steer an unerring course for the economy along with the needed social stability. We need good and impartial institutions founded on principles of accountability, transparency and a determination to execute their mission with eye set on the future.

The country would also do well to rein in the alienating new economic radicalism that has come about to favour instead a more assertive compassionate leadership by the state and greater dynamism of our private sector. Comfort will come from adhering to the principles of good governance and the required social compassion, come what may.

For a country like Mauritius, one of the good things it could do for itself is to club together with regional countries which come up above the lot but with focus and vision enough as to where one is headed for. Initiative and leadership are required to get such substantive linkages off the ground. We could work together with them to become mutually supportive and promote this club as a world-class economic performer.

This arrangement could then act as a buffer to sustain our standard of living even if global rich-country economic performance were in a downturn. By relying on such a dependable “home structure”, we would be less beholden to any single external force capable of undermining our economy. We’ll get there if we keep our own house in order and remain realistically forward-driven.

* Published in print edition on 14 August 2014

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