Rs. 51.99 Euro: Mauritius Traders Face Import Nightmare!

Since the dawn of April, the euro has exhibited a troubling upward trend against the Mauritian rupee, peaking on the 17th of April at an alarming rate of Rs 51.99.

What lies behind this surge? What are the short-term prospects for this exchange rate? Should we brace ourselves for a potential euro shortage?

In recent weeks, the euro has experienced a significant appreciation against the Mauritian rupee, igniting a wave of anxiety among economic operators and the general populace alike.

As of 17 April 2025, the exchange rate stood at approximately Rs 51.99 for one euro, a stark increase from Rs 49.17 just a week prior—a staggering rise of 4.5% in mere days.

This rapid escalation, albeit somewhat mitigated by an intervention from the Bank of Mauritius on 14 April, which injected $10 million at a rate of Rs 45/USD, reflects broader market dynamics, both international and local.

Expensive Euros

Dominique Filleul, President of the General Retailers Association, is unequivocal in his assessment: the relentless appreciation of the euro against the Mauritian rupee is already wreaking havoc on imports.

“Taking my business as an example; we primarily import clothing, jewellery, and footwear from Europe. This means we must pay in euros.

With the euro becoming more expensive, our import costs are consequently soaring,” he lamented.

Furthermore, in an environment of fierce competition, he explained the difficulty of passing these increased import costs onto retail prices.

“We are thus compelled to absorb these additional costs, which severely diminishes our profit margins,” he emphasised.

Pritam Dabydoyal, Director of P&P International, echoes this sentiment. He warned that the ongoing appreciation of the euro will not be without repercussions.

“Mauritius imports a plethora of products from Europe, including foodstuffs, clothing, and personal care items.

With the euro’s rising value against the rupee, a price increase is inevitable,” he asserted.

Filleul also raises a critical issue: the growing difficulty in obtaining euros.

“Due to a shortage, we are unable to settle our suppliers on time. This results in delays in the arrival of collections in Mauritius. Often, by the time they arrive, the products are no longer in vogue,” he lamented.

This scarcity of European currency is palpable not only at banks but also among other institutions specialising in currency exchange, he added.

Dabydoyal corroborated the existence of a genuine euro shortage in the foreign exchange market, noting that this predicament extends beyond the euro to other foreign currencies as well.

“As importers, we must purchase currencies incrementally each day from the banks. Only once we have amassed the necessary amount can we proceed with payments,” he explained.

Uncertain Prospects Ahead

In light of international geopolitical tensions and recent statements from the American president, Filleul believes the future remains precarious.

“I do not foresee the euro stabilising anytime soon. In my opinion, its upward trajectory against the rupee will persist,” he asserted.

However, he advocates for intervention from local authorities.

“It is imperative to devise solutions to control the exchange rate and maintain the euro’s value below Rs 50,” he proposed.

Meanwhile, amid the prevailing instability in international trade, Dabydoyal fears that a favourable exchange rate for the rupee is unlikely to materialise in the near future.

As the spectre of rising costs and currency shortages looms large, the fate of Mauritian traders hangs in the balance, awaiting decisive action from authorities.

Source: Defi Media