Recently, the European Union signed the largest aid deal ever with Mauritius (93 million Euros, to be exact). The aim of the package is to serve as a means to social and economic reform for the island nation. The timing of the deal couldn’t have been better. Only three days earlier, Mauritius’s Minister of Education and Human Resources expressed his nation’s desire to expand and modernize its textile industry. What implications might these events have on current and potential investors, and the textile industry as a whole?
For one, the aid deal signifies the dedication of the EU towards Mauritian textiles. The main textile markets for Mauritius are the United Kingdom, France, Germany, and Italy. The sector had shrunk four percent in 2009, but the aid deal should allow, to some extent, for the transformation of the textile industry, which Mauritius had been planning to do for awhile: "Competition is more intense at the low end of the market segment. It is vital for Mauritius to move up the global value-chain within the textile sector in producing value added textile items with design and brands," said the minister.
Though the deal is conditional upon Mauritius meeting EU objectives in sugar reform, governance, macroeconomic stability, and a long-term energy strategy, these agenda items will ultimately make Mauritian firms even more attractive investment opportunities. Increased investments will lead to the necessary capital for textile reform, and will ultimately help keep Mauritius a competitive global force in one of its most prized industries.