Despite the Increase in Tourist Arrivals: Mauritius Short on Foreign Currency as the Holidays Approach

Despite surpassing the symbolic milestone of one million tourists, Mauritius continues to face a shortage of foreign currency, affecting both businesses and individuals. As the festive season approaches, economic operators are questioning the limited availability of foreign currency. The increase in imports, which typically accompanies this time of year, raises concerns about how it will impact local businesses.

From January to July 2025, tourism revenue reached Rs 55 billion, a significant rise from Rs 64 billion in 2022 and an estimated Rs 93 billion in 2024. However, the ongoing shortage of foreign currency disrupts operations, particularly for importers who are struggling to secure the necessary funds for transactions.

In anticipation of the holiday rush, companies like Innodis have begun their logistics preparations early. However, they face challenges due to insufficient foreign currency, leading to delays in payments to international suppliers and a potential disruption in supply chains. Other operators, like Pritam Dabydoyal of P&P International, report ongoing difficulties in obtaining required amounts from commercial banks, resulting in missed business opportunities.

The local market is starting to feel the impact of these foreign currency shortages, with delivery delays leading to stock shortages and rising prices that consumers ultimately bear. To mitigate these effects, there is a call for prioritization in foreign currency allocation for essential imports.

While the Bank of Mauritius has made efforts to stabilize the currency and manage foreign exchange liquidity, questions remain about the repatriation of foreign earnings from the tourism sector. The lack of strict repatriation requirements may contribute to the ongoing foreign currency pressures.

As Mauritius approaches one of its busiest trading periods, the tensions in the foreign exchange market could complicate matters for importers. If the situation does not improve quickly, consumers may soon feel the consequences in terms of supply and prices. Effective management of currency priorities and transparency in circulation may become crucial in the coming months.