What an Average Performance Would Look Like

For Mauritius. 5-6% real GDP growth, a stable currency of Rs25/USD and progressive taxation. Energy costs sensitive to decreases and increases in international prices. Unemployment brought down to 6-7% once it is measured properly. Underemployment heading south too. Savings reverting to average pre-Shaitanomics levels of 25%. Productive investments encouraged. Speculative investments discouraged. Reducing national frustration with some basic policies. Like proclaiming beaches as public spaces. Not deproclaiming any beaches. Preserving the views of Mauritius. Waging total war against diabetes. Not doing anything blatantly stupid like signing TISA. That too behind our backs.

And what would an economic miracle look like? I guess lowering the retirement age to 55 or less. Definitely a surging currency: a good start would be an average 2% annual appreciation against the USD from the base above. Along with higher growth rates. Plus an infinite number of thoughtful little things.

Miracle not happening for sure. In fact an average performance looks increasingly out of reach. There's too much ambient stupidity. But that can be reduced. Like by releasing the water sector reform report of the World Bank. For a start.

Once a Tiger, Always a Tiger

Yep. I am looking at a 16-year span in the life of Panthera Tigris:

Period I (1987-1996): Exports increased by 2.86 times while the Singapore dollar appreciated by 50% with respect to the USD. In fact, exports and the Singapore dollar rose every single year.

Period II (1997-2002): Exports keep on increasing to reach 3.78 times their 1987 levels in 2002 while the Singapore dollar is about 22% lower than its 1996 level but is still close to 18% higher than its 1987 mark. Of course, during that period, Singapore went through two major and real storms: the Asian crisis and the SARS outbreak.

And at the end of 2008 the Singapore dollar was almost back to a 20-year high while exports increased by an additional one-third over its 2002 levels.

Depreciating Our Way to Chaos

Rajesh Jeetah once said that the textile industry was not a place for whiners. I couldn't agree more with him especially when you realise that our rupee has systematically been depreciated against the British pound over the last 24 years. That must have been a bonanza for the so-called export-oriented enterprises which saw the pound move from about Rs20 in 1985 to over Rs60 in 2007 as the above graphic shows.

What I don't understand is why some people from that group have been complaining non-stop for at least a decade about a strong rupee and their lungs seem to get larger by the day. What would they have said if they were operating from Singapore where the local dollar has pretty much appreciated against the USD? How would they have behaved if their operations were based in Canada which unlike us don't stigmatise their workers as lazy bones before allowing into the country foreign workers that will work for the smallest possible pay and endure the harshest working conditions which deprive their unluckiest citizens of a facade of dignity. Besides if the textile industry has been so bad, why the hell did they stay in there for so long?

The other interesting thing in the above graphic is that we clearly see the consolidation that the industry went through between 2001 and 2005. Bean-counters of course call that a shock.