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David V. Goliath: Mauritius Facing Up to China

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  • Vinaye Ancharaz

    (Department of Economics and Statistics, University of Mauritius, Mauritius. Email: v.ancharaz@uom.ac.mu)

Abstract

Recent studies of the impact of China's rise on the economies of sub-Saharan Africa generally find that the resource-rich countries of the sub-continent will gain while those that compete with China in export markets will invariably lose. Mauritius, with no exploitable natural resources, and facing acute Chinese competition in its traditional markets, is a most likely candidate to suffer China's onslaught. This paper argues that China's economic rise can benefit Mauritius. Analyzing the impact of China through the channels of trade, aid and investment, we show that preference erosion, not China's emergence, is to blame for the drastic loss of jobs in the clothing industry. This industry, however, has proved resilient since exports are back on a rising trend. On the other hand, Chinese aid to finance construction and infrastructure projects has been a welcome relief, even when it has been tied to the use of Chinese labour and inputs. The most significant benefits of China's engagement are likely to occur in the area of investment as China strategically uses Mauritius as a platform to penetrate the African market.Les études récentes sur l’impact de la croissance de la Chine sur les économies de l’Afrique subsaharienne concluent généralement que les pays riches en ressources naturelles en seront les principaux bénéficiaires, tandis que ceux dont les marchés d’exportation concurrencent la Chine seront inévitablement désavantagés. L’Île Maurice, sans ressources naturelles exploitables, et faisant face à une concurrence chinoise aiguë sur ses marchés traditionnels, fournit un bon exemple d’un pays particulièrement susceptible d’être défavorisé. Cet article suggère que l’importance croissante de la Chine en Afrique peut être bénéfique à l’Île Maurice. En analysant l’impact de la Chine sur le commerce, l’investissement, et l’aide au développement, il est démontré que les licenciements dans l’industrie de la confection à l’Île Maurice sont dus à une érosion des préférences et non pas à l’émergence de la Chine. Néanmoins, cette industrie manifeste une certaine ténacité puisque les exportations sont en hausse. Par ailleurs, l’aide au développement chinoise dirigée vers des projets de construction et d’infrastructure est bien reçue, même lorsqu’elle est liée à l’utilisation de travailleurs et de matériaux Chinois. Mais les avantages les plus significatifs d’un engagement de plus en plus important avec la Chine sont susceptibles de se produire dans le domaine de l’investissement car l’Île Maurice est une plate-forme stratégique chinoise facilitant la pénétration du marché africain.European Journal of Development Research (2009) 21, 622–643. doi:10.1057/ejdr.2009.26

Suggested Citation

  • Vinaye Ancharaz, 2009. "David V. Goliath: Mauritius Facing Up to China," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 21(4), pages 622-643, September.
  • Handle: RePEc:pal:eurjdr:v:21:y:2009:i:4:p:622-643
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    Cited by:

    1. Broich, T. & Szirmai, A., 2014. "China's economic embrace of Africa: An international comparative perspective," MERIT Working Papers 049, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

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