Economy

PORT LOUIS (Reuters) – Mauritius holds a parliamentary election on Sunday with incumbent Prime Minister Pravind Kumar Jugnauth and his main rivals all promising to tackle a cost of living crisis in the Indian Ocean archipelago.The country of about 1.3 million people markets itself as a link between Africa and Asia, deriving most of its revenues from a flourishing offshore financial sector, tourism and textiles.It has forecast 6.5% economic growth this year compared with 7.0% last year but many voters are not feeling the benefits.Jugnauth’s Alliance Lepep coalition has promised to raise minimum wages, increase pensions and reduce value added tax on some basic goods.It says it will use payments from the UK under an October agreement for Britain to cede the Chagos Islands while retaining the US-UK Diego Garcia air base. Mauritius also receives aid from China.”The alliance led by the prime minister is selling the economic prosperity card, with promises of more money to different segments of the population,” said political analyst Subash Gobine.The opposition is also pledging to increase pensions as well as introduce free transport and internet services and reduce fuel prices.It is dominated by the Alliance du Changement coalition led by Navin Ramgoolam and two other parties running in the Linion Reform alliance whose leaders, Nando Bodha and Roshi Bhadain, plan to alternate as prime minister if they win.”It is the youths who will make the difference in these elections,” voter David Stafford, 36, said in the capital Port Louis, explaining that people were looking for economic innovation and job opportunities as much as fiscal changes.Just over a million people are expected to choose lawmakers for the islands’ 62 seats in parliament for the next five years from a list of 68 parties and five political alliances.Last week, Jugnauth’s government blocked social media platforms until a day after the election, when results are expected, citing national security concerns after conversations between public figures were leaked. It lifted the ban a day later after opposition parties criticised the move.Voting starts at 0300 GMT on Sunday and closes at 1400 GMT. Whichever party or coalition gets more than half the seats in parliament also wins the prime minister’s post. More

TOKYO (Reuters) – The Bank of Japan (BOJ) hopes to maintain its 2% inflation target even if climate change causes long-term shocks to future price developments, Governor Kazuo Ueda said on Saturday.But Ueda said the BOJ will “monitor carefully” how the economic impact of climate change, as well as the fallout from government measures to promote the green transition, could affect inflation expectations.”We would like to keep the inflation target at the current level”, even if climate change shocks occur, Ueda said at a conference in Basel, monitored via live YouTube feed. “But I of course worry what it will do to inflation expectations.”Japan will likely introduce a carbon tax sometime in the future, which could affect inflation expectations, Ueda said at the conference, held to discuss the impact of climate change on the economy and monetary policy.Government subsidies to promote the green transition may also create inflationary pressure in the short term, although Japan can “accommodate such inflationary forces for a while”, as underlying inflation was currently still below 2%, he said.Under its green transition strategy, the Japanese government will provide fiscal support worth 20 trillion yen ($131 billion), or 3% of the country’s gross domestic product (GDP), to companies investing in environment-friendly technology over the next 10 years.In the second phase of the strategy, the government plans to introduce carbon pricing and operate a fully fledged emissions trading system in fiscal 2026, and to impose a fossil fuels surcharge in fiscal 2028.The conference was co-organised by the Bank for International Settlements, the BOJ, the Bank of Spain and the Network for Greening the Financial System.($1 = 152.6300 yen) More

“I am not concerned about the dynamics in Washington,” following Tuesday’s election of Trump, Kashkari said in an interview on Fox News. “Both sides of the aisle want us to keep the economy strong and get inflation down.””We have made a lot of progress and we want to get the job done,” said Kashkari, the first Fed policymaker to speak publicly following the central bank’s decision last week to cut the benchmark interest rate by a quarter of a percentage point to a range from 4.5% to 4.75%.Kashkari did not express a view on further rate reductions as soon as the Fed’s December meeting, but noted that recent strong growth and productivity gains might point to the need for higher interest rates than otherwise.”I have been surprised at how resilient the economy has been,” Kashkari said. “If that is sustained and we are in a structurally more productive economy going forward, that tells me we wouldn’t end up cutting as far.”Trump’s election raised the prospect he would renew the spat he had with Fed chair Jerome Powell over interest rate policy in his initial term, when the president wanted lower interest rates.But the emphasis has shifted since then to completing the battle against inflation, an issue that was central to Trump’s campaign.”I have a lot of confidence on the structures in place that force us and focus us on doing our economic jobs,” Kashkari said. “Everybody wants inflation back down and a strong labor market.” More

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Standard DigitalStandard & FT Weekend Printwasnow $29 per 3 monthsThe new FT Digital Edition: today’s FT, cover to cover on any device. This subscription does not include access to ft.com or the FT App.What’s included Global news & analysisExpert opinionFT App on Android & iOSFT Edit appFirstFT: the day’s biggest stories20+ curated newslettersFollow topics & set alerts with myFTFT Videos & Podcasts20 monthly gift articles to shareLex: FT’s flagship investment column15+ Premium newsletters by leading expertsFT Digital Edition: our digitised print editionWeekday Print EditionFT WeekendFT Digital EditionGlobal news & analysisExpert opinionSpecial featuresExclusive FT analysisFT Digital EditionGlobal news & analysisExpert opinionSpecial featuresExclusive FT analysisGlobal news & analysisExpert opinionFT App on Android & iOSFT Edit appFirstFT: the day’s biggest stories20+ curated newslettersFollow topics & set alerts with myFTFT Videos & Podcasts10 monthly gift articles to shareGlobal news & analysisExpert opinionFT App on Android & iOSFT Edit appFirstFT: the day’s biggest stories20+ curated newslettersFollow topics & set alerts with myFTFT Videos & Podcasts20 monthly gift articles to shareLex: FT’s flagship investment column15+ Premium newsletters by leading expertsFT Digital Edition: our digitised print editionEverything in PrintWeekday Print EditionFT WeekendFT Digital EditionGlobal news & analysisExpert opinionSpecial featuresExclusive FT analysisPlusEverything in Premium DigitalEverything in Standard DigitalGlobal news & analysisExpert opinionSpecial featuresFirstFT newsletterVideos & PodcastsFT App on Android & iOSFT Edit app10 gift articles per monthExclusive FT analysisPremium newslettersFT Digital Edition10 additional gift articles per monthMake and share highlightsFT WorkspaceMarkets data widgetSubscription ManagerWorkflow integrationsOccasional readers go freeVolume discountFT Weekend Print deliveryPlusEverything in Standard DigitalFT Weekend Print deliveryPlusEverything in Premium Digital More

Conducted among 134 enterprise financial software buyers, the survey provides insights into organizational investment focus, key pain points, and anticipated structural changes within the financial sector. The findings suggest that while ML and Gen AI adoption is lagging in financial departments compared to front-office functions, these technologies are emerging as essential tools for improving operational efficiency, strategic forecasting, and compliance within the financial ecosystem.The survey indicates that one of the largest obstacles within the finance departments, particularly in the office of the CFO, is “data gravity,” which refers to the difficulty of managing and integrating fragmented data across systems. This fragmentation hampers efficient decision-making and the effective deployment of AI technologies. Addressing this challenge by unifying data systems is seen as critical for financial teams aiming to harness AI capabilities for enhanced analytics and forecasting. The analysts flag that ML and Gen AI hold the potential to simplify complex data environments, improve productivity, and support initiatives, yet require cohesive data infrastructures to be fully effective.In terms of budget priorities, enterprise financial buyers are increasingly directing resources towards analytics, business intelligence, and continuous planning tools, which are anticipated to benefit from integrated AI functionalities. The survey reveals that 51% of respondents identified business process automation as a top investment area, while 42% prioritized strategic solutions such as analytics and reporting, planning, and ML-driven corporate performance management. These trends suggest a sustained demand for tools that offer immediate, strategic insights, particularly in today’s volatile economic environment.Interestingly, organizations are willing to allocate additional funds for Gen AI and ML functionalities. On average, financial software buyers are prepared to pay nearly 6% more for subscription services that incorporate these technologies, signaling an acknowledgement of their added value. However, generative AI and ML are expected to take longer to become mainstream in the financial sector than in other enterprise functions due to the complex integration and compliance needs of financial systems. This slower adoption rate underscores a growing recognition of the medium-term potential of AI technologies within finance, with nearly half of surveyed organizations planning implementation within the next year. More

KARACHI (Reuters) – Pakistan will reduce electricity tariffs during winter in a bid to boost consumption and cut the use of natural gas for heating, its power minister told Reuters on Saturday. The move is expected to provide relief to businesses and citizens, who have suffered from steep and sudden increases in electricity tariffs following energy sector reforms suggested by the International Monetary Fund (IMF).Utilities in Pakistan, many of which have had to curtail or even completely cease operations in winter months due to demand dropping by up to 60% from peak summer levels, will also benefit from the move.”Reducing prices will increase demand, especially in winter when people use inefficient gas resources,” Power Minister Awais Leghari told Reuters in a telephone interview.Pakistan will pilot the plan starting this winter, and the lower tariffs will apply between December 2024 to February 2025, he said.The IMF, which approved a $7 billion, 37-month loan for Pakistan in September, did not immediately respond to a request for comment.Pakistan relies heavily on expensive natural gas and burning wood for heating during winter.Power consumption in Pakistan has declined 8-10% year on year over the past three quarters, Leghari said. But he said he hopes that an economic recovery will cover up for lost ground and will help boost demand by a net average 2.8% annually over the next ten years.Leghari expects the move to slash winter tariffs to help industries reduce electricity costs by 7-8% at an optimal level, while stimulating industrial growth in the process.Leghari also said the government is working to rationalize power tariffs, re-profile power sector debt and adjust tax structures within electricity bills.”The government is in talks with development partners to reduce taxes to spur growth of electric vehicles and combating the emergent problem of air pollution, promoting a shift away from combustion-based transportation towards clean energy,” he said. More