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Euro crisis’ knock-on effect


PORT LOUIS — Mauritius’ economy will grow more slowly than expected in 2012, partly due to a hit on tourism from the economic turmoil in Europe, said the central bank which expects to trim its forecast before its rate-setting meeting next month.
The debt crisis in the euro zone, the main market for Mauritius’ exporters, has dampened demand for exports such as textiles and slowed tourist arrivals to the Indian Ocean island, denting economic growth.

A slowdown in sugar production also dragged on the economy.

The Indian Ocean island’s US$10-billion-a-year economy relies on European markets to buy its sugar and textile exports and provide the visitors that keep its key tourism sector running.

To help cushion exporters, Mauritius extended them a 600 million euro foreign currency credit line meant to help cushion exporters from the euro zone crisis.

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