05.06.2026
Mauritius’ economy remained resilient in 2025, supported by tourism, financial services, ICT and private consumption, but growth slowed as major infrastructure projects were completed and new investment softened. Growth is expected to weaken in 2026 due to subdued external demand, higher oil prices, higher airfares and uncertainty linked to the Middle East conflict, before rebounding in 2027 if investment and services activity strengthen. Inflation remains within the Bank of Mauritius’ target range, although external cost pressures have increased. Fiscal pressures remain elevated, with large deficits, high public debt and rising social and wage commitments. The external position remains vulnerable to import costs, tourism demand and weak goods exports.
| Indicators | 2025 | 2026 | 2027 |
|---|---|---|---|
| GDP growth (%, yoy) | 3.2 | 2.5 | 4.6 |
| Inflation (%, yoy) | 3.7 | 3.9 | 3.7 |
| Employment rate (% of working-age population, 15+) | 52.5 | 52.6 | 52.7 |
| Fiscal balance (% of GDP) | -7.6 | -7.1 | -6.1 |
| Gross public debt (% of GDP) | 88.9 | 90.6 | 90.3 |
| Current account balance (% of GDP) | -6.7 | -7.0 | -6.5 |
Growth slows before rebounding in 2027
Mauritius’ real GDP growth is estimated at 3.2% in 2025, down from 4.9% in 2024. Growth was supported by record tourist arrivals, financial services, ICT and consumption, but it slowed as large infrastructure projects were completed and new investment weakened.
Growth is projected to slow further to 2.5% in 2026. Subdued external demand, higher oil prices, higher airfares and uncertainty linked to the Middle East conflict are expected to weigh on tourism and services exports. Growth is then projected to rebound to 4.6% in 2027, supported by stronger investment, services activity and tourism resilience.
Tourism and services remain central
Tourism remains a key pillar of the economy, supporting hotels, transport, retail, restaurants and foreign-exchange earnings. However, the sector is exposed to higher airfares, oil prices and disruption to long-haul travel routes. Middle East carriers account for an important share of flights to Mauritius, making regional disruption a direct risk to arrivals.
Financial services and ICT continue to support diversification and external inflows. However, Mauritius still faces structural challenges, including weak export competitiveness, low productivity growth, low female labour-force participation, youth unemployment and an ageing population.
Inflation remains moderate but risks have increased
Inflation averaged 3.7% in 2025, partly reflecting excise-tax-driven price increases, while underlying price pressures remained contained. Inflation is projected to rise slightly to 3.9% in 2026 before easing to 3.7% in 2027, remaining within the Bank of Mauritius’ target range.
The main upside risks come from oil prices, food prices, airfares, freight costs and exchange-rate pressures. Higher imported inflation could also erode tourism competitiveness and household purchasing power, especially if global energy-market disruption persists.
Fiscal pressures remain elevated
The fiscal deficit remained large at 7.6% of GDP in 2025, reflecting higher public-sector wages, social benefits, grants and transfers. Revenue measures, including a lower VAT threshold, a tourist fee and VAT on digital services, should help raise revenue in 2026, while pension and social-benefit reforms are expected to moderate recurrent spending gradually.
The fiscal deficit is projected to narrow only slowly, to 7.1% of GDP in 2026 and 6.1% in 2027. Public debt remains high, projected at around 90% of GDP in 2026–2027. Elevated debt and rating pressures make fiscal consolidation a central policy priority.
External position remains vulnerable
The current account deficit widened to 6.7% of GDP in 2025, reflecting front-loaded imports ahead of excise-tax increases and continued weakness in goods exports. Strong financial-services inflows supported reserves, which remain comfortable.
The deficit is projected to widen slightly to 7.0% of GDP in 2026 before narrowing to 6.5% in 2027. Tourism receipts, financial services and reserves provide important buffers, but the external position remains vulnerable to higher oil prices, freight costs, weaker tourism demand, lower goods exports and cyclone-related disruptions.
Overall outlook
Mauritius’ outlook remains stable but more challenging than in the immediate post-pandemic recovery period. Growth is expected to slow in 2026 before rebounding in 2027, while inflation should remain moderate. The main risks are fiscal and external: high public debt, large fiscal deficits, elevated import dependence and exposure to tourism and climate shocks. Sustained progress will require fiscal consolidation, stronger productivity, export competitiveness, pension reform, better-targeted social spending and continued diversification through financial services, ICT, tourism and higher-value activities.
Sources:
World Bank, Mauritius Macro Poverty Outlook, April 2026.
International Monetary Fund, Staff Completes 2026 Article IV Mission to Mauritius, May 2026.
International Monetary Fund, Mauritius: 2025 Article IV Consultation and Staff Report, June 2025.
International Monetary Fund, World Economic Outlook, April 2026.
Bank of Mauritius, Monetary Policy Committee Statements and Inflation Outlook, 2026.
African Development Bank, Mauritius Economic Outlook, 2026.
