In its credit note on the MCB Group, ratings agency, Fitch, offers its prediction of Mauritius GDP growth this year and in 2022. It says Mauritius will have a “weak recovery”, with real GDP growth predicted at 4.5% in 2021 and 6.5% in 2022.
Rating agency Fitch predicts a 4.5% GDP growth for Mauritius in 2021, and 6.5% in 2022, with contraction last year estimated at 14%. Therefore, GDP growth over the next two years won’t be enough for Mauritius to annihilate the effects of the Covid-19 pandemic on its economy.
Those insights came from Fitch credit note on Mauritius largest bank, the MCB Group, where the firm affirmed MCB’s Long-Term Issuer Default Rating (IDR) at ‘BBB-‘ with a Negative Outlook.
Fitch expects Mauritius to have a relatively weak economic recovery in 2021, with real GDP growth predicted at 4.5% in 2021 and 6.5% in 2022. “The pandemic has had a significant impact on the globally-integrated Mauritian economy, with real GDP contracting at an estimated 14% in 2020. The economy particularly suffered from a two-month nationwide lockdown at the onset of the crisis and the prolonged closure of the country’s international borders that has had a significant impact on the tourism sector and related industries, which together account for a material percentage of GDP”, says Fitch Ratings in its credit note on Mauritius’ largest bank, the Mauritius Commercial Bank (MCB).
Fitch’s forecasts for economic growth in Mauritius are much lower compared to those of local institutions. In its latest MCB Focus, Mauritius largest banking group, MCB Group forecasted a 6,2% of GDP (basic price) growth for the African country this year.
It is precisely in its credit note on MCB, that Fitch offers his predictions on the economic growth of the African country. In its note, Fitch Ratings has affirmed MCB Long-Term Issuer Default Rating (IDR) at ‘BBB-‘ with a negative outlook.
The negative outlook on MCB’s long-term IDR reflects the negative impact of the pandemic on MCB’s operating environment and the resulting downside risks to the bank’s financial profile, in particular asset quality and profitability (Read more).