Professor Jeffrey Frankel at University of Mauritius
Professor Jeffrey Frankel, James W. Harpel Professor of Capital Formation and Growth,Harvard Kennedy School gave a lecture at the University of Mauritius Auditorium yesterday Tuesday 13 Jan 09. Ahh after Prof. Paul Romer, high time to attend my second public lecture by another Economist of Worldwide Reputation.
The title of the first presentation was:
a small ship on rough seas: How does a Small Open Economy cope with big external shock?
Prof. Jeffrey came to Mauritius as part of an NBER African Project. NBER stands for National Bureau of Economic Recession. On Dec. 2, 2008 NBER declared official recession. The NBER African project is funded by Gates Foundation (lol, in Gate’s website, notice the Search is still in Beta!).
Mauritius: African Success Story?
According to Prof., Mauritius achieved highest per capita and is top of the charts. Prof. , on this project currently is still very early in investigations and has preliminary thoughts.
one slide covered stages of Mauritius’ Economic Development
The initial conditions of economic development were considered poor at independence.
- Sugar Wealth
- Foreign ideas
- Does M’tius have good institutions?
Handicap in economic performance caused by:
- small size of the country
- Tropical location
Whether through luck or skill, throughout its history, Mauritius has been able to adapt to changed circumstances.
“When we came to power in 2005, the economic situation was aweful” – R. Sithanen
3 bad shocks:
- Lost sugar preferences
- losing clothing market
- rise in world prices of oil and food crisis
- slow growth
- large budget deficit
- Balance of Payments deficit
2006 – New Govt. Economic reform: tax reform amongst others
2008: worst global economic crisis in 50 years
The financial crisis originated in the US in 2007 (prof. said : “sorry for that” :D)
A question to Prof. from a San Francisco reporter: Is every country is in recession?
Ans: Mauritius is the only country I know that did not go into a recession in 2008!
One reason: the govt. had a strong budget. a true rare case of counterfiscal policy
Conclusion by prof:
- A small remote country needs trade more than does any other country
- The accomplishment of Mauritius has been extremely impressive
- Prescription: further liberalisation, reform investment
Questions/ Answers Session
Head of Dept. – Dept of Economics & Statistics, Mr. ANCHARAZ Vinaye Dey asked: “Are you optimistic about Mauritius in the 2008 recession?”
Ans: Prof is pessimistic about the world economy but he is optimistic for Mtius.
Another question from Manisha Dooburee: Geopolitical positioning of M’tius. Mauritius situated in a trading route. What about the suez canal..
Ans: M’tius as a Singapore can become a hub
A comment came from Mauritius Commercial Bank Economist.
And a question from what the Prof recommend to m’tius become a resilient economy?
Ans: Infrastructure, handle traffic congestion etc.
Prof also asked a question concerning Food Security and 2 people tried to answer that from the floor.
The Second Presentation was about Worldwide economy in recession:
ya, Professor also referred to the Obama Team (who is now the President of USA) and quote from Prof.’s blog:
No, Obama did not choose this team because they are Clintonites or top scholars or my friends. He did not choose them because economists (leaving aside, as always, the far left and the far right) consider this a dream team. He chose them because they are The Best and Brightest and The Least Arrogant.As the President-elect says, the American people want effective leaders, not primadonnas
The recovery is unlikely before end-2009. The statistics presented in the slides were very interesting. We could not stay until the questions/answers session as it was getting late and raining heavily also in Reduit.
It was a great pleasure and golden opportunity to assist a public lecture from a Harvard Professor. I was delighted to see the high quality of discussions from the members present in the lecture. Brillant economists from M’tius interacting with a US Brillant Economist. The standard was definitely high. I was enjoying the Economist language as despite being a management student, I still think like an economist. Well we would like to thank UoM for this opportunity and maybe they could invite more scholars from London School of Economics, University of California-Berkeley, Yale, Princeton, UCL, University of Nottingham, Oxbridge.