Mauritius PM Ramgoolam: Previous government misstated GDP and public debt

Mauritius' previous government falsified the country's gross domestic product (GDP), budget deficit and public debt figures for years, its new prime minister said on Tuesday, accusing the former administration of practicing "voodoo economics".

Announcing the results of an audit he launched into the Indian Ocean archipelago's public finances, Prime Minister Navin Ramgoolam said GDP figures since 2022 had been misstated to give the false impression of an economic boom.

Ramgoolam's coalition won a resounding election victory in November, returning him to the position of prime minister for a fourth non-consecutive term.

"The previous government has fumbled and jumbled the economic fundamentals. Their mismanagement of the economy and the falsifying of figures have been an unmitigated disaster," he said in a speech to lawmakers.

"They have been practicing voodoo economics."

The former finance minister has not responded to requests for comment about Ramgoolam's allegations since the launch of the audit and did not answer calls or messages from Reuters seeking comment on Tuesday.

Ramgoolam, who took up the finance minister position in his cabinet, said the previous government had overstated 2023's nominal GDP by 1.4 percentage points by deliberately exaggerating growth in the construction sector.

A copy of the audit's findings, labelled the State Of The Economy, said the 2023 growth rate was now estimated at 5.6%, not 7.0%.

The actual 2023/24 budget deficit was 5.7% of GDP, not 3.9%, and public sector debt was above 83% of GDP in June 2024, whereas it had been given as over 77%.

Ramgoolam said his government would rebuild fiscal space while safeguarding critical social spending to protect the most vulnerable.

It will aim to bring down the debt ratio to around 60% of GDP, working with development partners, international institutions and countries friendly to Mauritius, he continued.