Financial globalisation and economic resilience in Mauritius

Abstract

Financial globalisation presents new challenges and opportunities for Small Island Developing States like Mauritius. Although this has resulted in further exposure of such states to external conditions, it has led to the modernisation of the financial sector, which in turn provided a source of further economic growth not only through the development of this particular sector but also through institutional development. This in turn may have contributed towards economic resilience building. The objective of this chapter is to highlight the institutional and policy changes which took place in the Mauritian financial system. A preliminary assessment of the impact of the liberalisation of financial services on the financial system will be attempted in terms of capacity building, capital flows and enhanced efficiency. This case study helps to shed light on the problems faced by Mauritius and by other Small Island Developing States in their attempt to'integrate within the world financial markets.