16 January 2004

The Impact of Global Financial Integration on Mauritius and Seychelles

This paper focuses on the obstacles and challenges of global financial integration faced by Mauritius and Seychelles, two small islands states in the Indian Ocean. It is argued that globalisation is rapidly, and to a large extent irreversibly, changing the way business and policy are conducted in small open economies and in the industrialised world. The paper also refers to the difficulties faced by small island states in their attempt to liberalise their economies, notably those related to intensification of competition, maintenance of sound macroeconomic policies, effective management of risks, cross-border bank supervision, modernization of financial legislation, and adaptation to changes in the international business cycle.

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