Internal Financial Markets and Corporate Investment Strategies in Africa — A Case Study of Mauritius
Prayagsing Chakeel Coomar, Jankee Kheswar
This Paper confirms that, in a pre-financial crisis environment, alternative forms of corporate arrangements and operation of internal financial markets impact differently on
corporate investment decisions, tested in heterogeneous samples in Mauritius. Innovatively, a more rational measure of internal finance (net liquidity), in line with International Accounting
Standards, is adopted. It is found that only certain categories of firms rely more on internal finance than others and also do not resort to debts. Based on the results available, several
policies are proposed for the authorities and financial institutions in view of addressing the problem of financial constraints (FC) and enhancing corporate investments.