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Mayotte - Economy

Economic activity is based primarily on the agricultural sector, including fishing and livestock raising. Mayotte is not self-sufficient and must import a large portion of its food requirements, mainly from France. The economy and future development of the island are heavily dependent on French financial assistance, an important supplement to GDP. Mayotte's remote location is an obstacle to the development of tourism.

In 2009 (last available data), Mayotte’s gross domestic product (GDP) stood at EUR 1,396m. It rose by an annual average of 11% between 2005 and 2009. The institutional sector of public administrations is the main contributor to wealth creation in Mayotte (50.5% of GDP, up 1.5 points compared to 2005). The added value created by companies over the same period fell by 2 points (22.6% in 2009), while that of households (including individual companies) rose slightly (26.9% in 2009). These two institutional sectors experienced dynamic development between 2005 and 2009 and make a significant contribution to growth. Consumption continues to be the main driver of Mayotte’s economy. Despite this extremely dynamic growth between 2005 and 2009, Mayotte’s 2009 GDP per capita remained four times lower than in mainland France over the same year. It is eight times higher than in the Comoros.

Trade is characterised by a very strong predominance of imports. The structural deficit of the trade balance is becoming more marked year by year. This trend can be explained both by the continuous increase in imports due to the rise in living standards and the household equipment rate, and by the low level of exports, which show uneven trends. Mainland France is the main trade partner, both for imports and exports of Mayotte’s specific products. The Comoros are Mayotte’s second largest client, mainly for re-exports of goods.

Mayotte’s economic fabric mainly comprises very small units (90% of active companies have less than 5 employees). There are about 500 “large corporations” (i.e. with an annual turnover in excess of EUR 150,000). The trade, transport and personal services sectors account for 58% of the added value of large corporations.

The construction industry has been one of the engines of Mayotte’s economy over the past ten years, with activity driven both by public procurement (significant needs for infrastructure) and private demand (population growth and increase in incomes). In 2007, the sector employed 10% of registered employees and accounted for about 16% of the added value of large companies in 2005. Since 2008, the construction activity has deteriorated significantly due to the slowdown in construction and housing sales and delays in the start-up (or absence) of large-scale projects.

With an extremely low level of orders and the widespread lengthening of payment periods, particularly by local authorities, many companies have had to reduce their workforce or close. However, there were some signs of an upturn at the end of 2012, although the situation does remain fragile and activity is below the 2008 level.

In 2012, tourism accounted for about 7% of active companies in Mayotte and employed less than 2% of the workforce. Tourism remains limited, despite the island’s potential for natural and cultural tourism. This sector suffers from the low level of reception facilities, in terms of both quality and quantity, combined with the lack of qualifications of the workforce. It is also limited by the fact that the destination has only recently been promoted and by the high cost of air travel.

However, for Mayotte, tourism is a sector of activity with great potential to create added value and employment. A Tourism Development Master Plan was defined for Mayotte in 2006, with the aim of reaching a target of between 120,000 and 150,000 visitors a year by 2020. The current number of tourist visits is, however, way off these objectives, with only 45,800 tourists in 2012 (-5.0% year on year). The Departmental Tourism Committee is continuing its promotion activities and is taking part in regional and national events in order to sell Mayotte as a destination.

The year 2013 was the year prior to Mayotte’s accession to the European status of Outermost Region (OMR) and the application of the ordinary rules of taxation, which came into force on 1st January 2014. The business climate initially continued to improve: companies benefitted from a positive trend for their activities and continued to invest. However, towards the end of the year, they adopted a wait-and-see policy and postponed their projects. Indeed, despite a level of activity considered to be reasonable, there was a marked decline in the Business Climate Indicator starting in the third quarter, before it stabilised in the fourth quarter. The labour market continues to be sluggish, with the number of job offers well below demand. Household consumption did, however, show small signs of improvement and slowly picked up in a context of moderate inflation.

At the sectoral level, market-related services benefitted from an upturn in activity. There was a more mixed picture for activity in the construction industry, which suffered from extended payment periods. In the middle of the year, it was also affected by cement supply problems. The tourist industry stabilised at a low level throughout the year. Finally, the decline in the retail sector came to an end, and there was a slight upturn in its activity at the end of the year.

Following the restructuring in the industry in 2012, activity in the aquaculture sector was steady and strong during the first three quarters of 2013: farm fish exports rose by 35.3% over the period to 63 tonnes. However, in the last quarter, the activity suffered from administrative delays, which blocked the launch of a development project for the industry. Consequently, supplies did not increase and there were no exports in the last quarter. In the end, exports fell by 6.9% in 2013 compared to 2012. Exports of essence of ylang-ylang were stopped in 2013, following the sharp declines in 2011 and 2012 (-72.0% and -79.8%, respectively). The low level of activity that had been maintained was reduced to product deliveries to the local market, mainly for tourists.

Mayotte’s accession to the European status of OMR gave signs of hope for economic agents, who saw it as an opportunity to scale up and accelerate the economic, social and environmental development of the island. However, the implementation of European funds also gave rise to a climate of uncertainty, as the technical and financial methods for this had not been finalised. Consequently, companies do not have sufficient visibility in terms of eligible projects, their methods and their financing timeframe. In addition, the application of the ordinary rules of taxation also gave cause for concern to households over their level of taxation, especially at local level, and to actors in the production sector over the volume of public procurement that could maintain their level of activity in 2014.

Employment is marked by the island’s transformation to a service economy. Employment in the service sector is developing at a faster pace than in the primary and secondary sectors and accounts for over 80% of job offers registered by the Employment Agency. Public administrations are the largest employer (54% of total employment, 50.4% of job offers in 2012) and the private sector is experiencing rapid development. The unemployment rate was estimated at 17.6% in 2009. However, this figure underestimates the full extent of unemployment on the island. Indeed, ILO criteria for defining unemployment create an extremely strong “halo” around unemployment in Mayotte, with 29,300 inactive people wanting to work who are not included as being unemployed by ILO. Unemployment is mainly due to the mismatch between professional qualifications and the needs of the productive sector.

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Page last modified: 24-07-2017 18:27:51 ZULU