Care Edge Forecast: Growth outlook is moderate, with downside risks

According to the latest report from Care Edge, the Mauritian economy enters 2026 in an uncertain climate, marked by increasing external risks and limited internal room for maneuver.

Published at the end of last week, the “Mauritius Economy Update” report from Care Edge provides a cautious overview of the national economic situation and highlights weakened prospects for the coming year.

In 2025, gross domestic product (GDP) growth stood at 3.2%, a level in line with estimates from Statistics Mauritius published in December, and slightly higher than the forecast of 3.1% from the Bank of Mauritius. This result, according to the authors of the report, however, marks a clear slowdown compared to the 4.9% expansion recorded in 2024.

For 2026, initial projections showed an increase of 3.4%, supported in particular by the resilience of the tourism sector and an expected recovery in private investment. However, the recent evolution of the conflict in the Middle East has changed this balance, accentuating the uncertainties linked to international trade and the prices of raw materials.

In this context, the reference scenario now expects growth close to 3%, provided that geopolitical tensions are contained. On the other hand, a worsening of the conflict could reduce economic growth to around 2.3%. This assumption is based on increased costs of fuel and inputs, such as fertilizer, gas and airfares, as well as possible disruptions to supply chains.

These developments could weigh on several key sectors: tourism, construction and agriculture. In addition, budgetary constraints and inflationary pressures would limit the authorities' capacity to support activity through public spending.

At the same time, private investments should remain measured, hampered by restrictive financing conditions and a less dynamic real estate market, suggesting moderate activity in construction.

The recent evolution of consumer prices reflects an apparent lull, which, however, masks persistent tensions on the structural components of inflation.

In March 2026, headline inflation slowed to 2.7% year-on-year, compared to 3.5% in the previous month. This deceleration, according to the authors, confirms a trend towards the easing of immediate pressures on prices. It is mainly explained by the decline observed in the food and non-alcoholic beverages category, where inflation fell by 3%. A decline was also noted in food and accommodation services, down 0.7%.

However, Care Edge believes that this improvement does not reflect the entire pricing dynamic. Core inflation, which excludes the most volatile elements, remained stable