MAURITIUS Law and Practice Contributed by: Gilles Athaw, Jason Barbe, Deeviya Rughooputh and Sushika Ramlugun, Bowmans
Bowmans 3rd Floor, The Dot Avenue De Telfair Moka 80829 Mauritius
Tel: +230 460 5959 Fax: +230 208 0605 Email: Info-ma@bowmanslaw.com Web: www.bowmanslaw.com
1. Loan Market Overview 1.1 The Regulatory Environment and Economic Background
1.2 Impact of Global Conflicts The emergence of new geopolitical tensions in 2024 and 2025 – including the prolonged effects of the Rus- sia-Ukraine conflict, ongoing instability in the Middle East, and rising unrest in other key regions – has fur- ther strained global trade networks. These develop- ments have led to increased import costs, particularly for critical goods such as fuel and food. The result- ing surge in living and operational expenses has had inevitable direct consequences for both households and businesses in Mauritius. Amid persistent inflation, currently estimated at 4.0%, and an extended period of elevated interest rates, the demand for credit facilities from both the household and corporate sectors has nevertheless continued to increase, despite the relatively high cost of borrow- ing. For households, this trend reflects both structural demand for housing and consumer durables, as well as a gradual recovery in private consumption following the pandemic and subsequent global shocks. On the corporate side, firms have sought additional financing to support investment in capacity expansion, working capital requirements, and refinancing of existing debt obligations in an environment of tightening liquidity. Cross-border banking activities continue to represent a central pillar of growth and profitability for Mauritian banks, enabling diversification of revenue streams and strengthening of their regional footprint, particularly in Africa and Asia. In parallel, the investment strategies of domestic banks have been increasingly directed towards higher-yielding but liquid assets, as institu-
Mauritius has remained highly exposed to significant external pressures stemming from ongoing global geopolitical tensions – including conflicts in the Mid- dle East and Eastern Europe – as well as disruptions in international trade. These challenges have intensi- fied inflationary pressures, which remained elevated throughout 2024 and 2025. In response, the Bank of Mauritius raised the key repo rate to 4.5% per annum, a level that has been maintained into 2025. This indi- cates a cautious monetary policy approach focused on stabilising inflation expectations in view of stop- ping the depreciation of the Mauritian rupee. Against this backdrop, the Mauritian economy has nevertheless demonstrated signs of resilience and recovery. The recent general elections held in Mau- ritius have led to an adjustment of the country’s eco- nomic policy direction. The newly elected govern- ment has reaffirmed its commitment towards fiscal consolidation and good governance through robust measures but also the widening of the list of powers of the Financial Services Commission of Mauritius that can be exercised in co-operation with foreign supervi- sory institutions. This is to enhance the Commission’s ability to conduct special investigations in collabora- tion with international regulators, strengthening cross- border regulatory enforcement.
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