Opening doors on January 15th, 2018, the Economic Development Board (EDB) was created through the merger of three government institutions – the Board of Investment, Financial Services Promotion Agency and Enterprise Mauritius – to promote trade and investment, the ease of doing business, and Mauritius as an international financial center. Joseph Charles Cartier, chairman of the EDB, says that Mauritius should not be considered as simply a “gateway” to Africa, but rather as a steady leader of African business.
How would you qualify Mauritius’ progress since independence?
Since its independence in 1968, Mauritius has emerged as a robust and successful economy, despite its limited natural resources. In fact, the country has made remarkable progress in furthering its socioeconomic development agenda and has graduated from the monocrop economy of the 1960s, relying mainly on sugar cane, to a multi-pillar economy today.
After spearheading the take-off of its two key industries, manufacturing and tourism, in the 1980s, Mauritius pursued its diversification strategy to broaden our economic space in the 1990s, with a key focus on the development of our services sector, such as the financial services, logistics, and ICT-BPO.
Mauritius anchored its economic success on its prevailing political and social stability, and its solid democracy. This has contributed to the growing reputation of Mauritius as a stable, reliable and competitive investment hub.
Our revenue per capita income increased 50-fold to reach $10, 500 today, as compared to $400 in 1968. We posted a peak GDP growth rate of around 10% in the 1980s, and today we are registering an average of about 3.9%, which is above the global GDP average of 3.5%. With the new economic strategy that hinges on inclusive growth, sustainable development and economic independence, we are projecting growth above 4%, taking Mauritius into the league of high-income economies.
Why do you believe Mauritius has become such an influential service industry hub?
The services sector is a growing component of our economy and accounts for about 76% of our national output, making it a major revenue generator. It currently employs approximately 350 000 people. The Government’s commitment is to further consolidate the dynamic services sector, in line with its vision of developing Mauritius into a smart island.
In the ICT sector, high-end activities such as software development and animation, big data analytics, disaster recovery, and cloud computing are being actively promoted. Mauritius also has all the necessary ingredients to emerge as the regional hub for high-end healthcare services and manufacturing of medical devices.
In addition, the higher education sector is a strong avenue of growth, and, every year, we are seeing a systematic increase of influx of foreign students coming to train in the Mauritian education hub. The fashion, entertainment and cinema industries in Mauritius are also experiencing noted growth, especially with registered interests from foreign studios to set up in the country.
The services sector thus represents a huge potential for Mauritius, and at the level of the EDB, we have defined a strategy to attract branded global players in these segments to set up operations in the country.
What role does the EDB play in sharpening competitiveness?
Mauritius is fully capitalizing on its competent skill base and its talented and multi-lingual pool of professionals to position itself as a competitive economy to do business in the region. The country is ranked first in Africa in several international accolades; for instance, in 2018, Mauritius topped the prestigious World Bank Doing Business as Africa’s leader in doing business while being ranked 25th globally. This outstanding performance bears testimony to the bold reforms undertaken by the government to improve the business ecosystem.
Furthermore, business facilitation remains a key priority for the government and is also very high on EDB’s agenda. We are thus committed to tackle red tap and legislative impediments to doing business. A landmark initiative in this regard pertains to the launch of a digital licensing portal in collaboration with the European Union in May 2018 to ensure that processes for obtaining governmental licenses are seamless and less time-consuming.
How does the EDB plan to further define Mauritius’ status as an African leader?
In order to position Mauritius as a leader on the continent, the Africa Strategy of the EDB consists of three essential components: act as a catalyst in driving sustainable investment in Africa; endeavor to bring more convergence in the policies among the regional economic communities; and spearhead special zones in like-minded African countries to create the necessary enabling environment for foreign investments.
Thought its International Financial Centre (IFC), Mauritius is already playing a pivotal role in attracting sustainable capital and investment to propel growth and prosperity in several countries across the African continent. In addition to mobilizing investment from the international community through our IFC, we have developed an outward investment strategy to encourage Mauritian companies in expanding their footprint in Africa. This outward investment strategy not only increases the economic space of Mauritian investors, but it also allows homegrown African companies to benefit from the wealth of expertise our Mauritian companies bring, such as in the field of manufacturing, food production, ICT-BPO and sugar refining.
The EDB also participates in a number of forums of the various economic communities to which Mauritius belongs, including the African Union, the Indian Ocean Rim-Association for Regional Cooperation, the Common Market for Eastern and Southern Africa (COMESA), and the Southern African Development Community. The EDB also chairs the Steering Committee of the World Association of Investment Promotion Agencies (WAIPA) for Sub-Saharan Africa, and the COMESA Regional Investment Agency. Our role in these forums is aimed at ensuring synergies and coherence in policies so as to foster greater intra-African investments and to transform the region into a major destination for international investors.
Finally, through its Mauritius Africa Fund SPV, the country has embarked an ambitious program of setting up special economic zones in key African countries, including Senegal, Ghana, Côte d’Ivoire and Madagascar. The Mauritius Africa Fund is an initiative of the Government of Mauritius to develop business infrastructure, such as technology parks and industrial zones to facilitate the investment of Mauritian private companies in Africa.
Why is Mauritius an apt IFC for Africa?
Building on its two decades of expertise in cross-border finance, Mauritius is home to a vibrant and sophisticated IFC. The IFC is a tested and proven jurisdiction for investments in emerging markets and has been the hub of choice for international investors investing in Africa. The proximity with the continent and our business-friendly environment with a simple tax system has characterized this choice.
But, in addition to that, Mauritius as an IFC for Africa also benefits from a hybrid legal system combining the civil and common laws, no exchange control, a rich pool of talented and competent professionals in the financial services sector, with proficiency in English and French, and state-of-the-art infrastructure with high internet connectivity and modern port and airport facilities.
Mauritius is also home to one of Africa’s leading and most innovative exchanges, offering an attractive listing, trading and capital-raising platform, as well as major international banks. The country is also party to a number of bilateral treaties with African countries, notably for enhancing fiscal efficiency and mitigating investment risks. Mauritius is also a member of the Multilateral Investment Guarantee Agency, a World Bank affiliate, for the provision of political risk insurance and insurance guarantees for cross-border investments going into Africa.
Finally, the Mauritius IFC is a well-regulated jurisdiction when it comes to international fiscal matters and combatting illicit flows, and has been rated as “compliant” – which is the highest rating by the OECD – in August 2017.
What industries are most attractive sectors in terms of investment for Mauritius?
Mauritius offers a very liberal platform with an attractive investment base. Throughout our development, we have expanded our economic activities from sugar to textiles, tourism to financial services, a freeport to seafood, and ICT to real estate. Mauritius has, within a short span of time, emerged as a robust economy poised for the future. All these sectors have benefitted from substantial FDI inflows, transfer of technology and skills that have positively contributed to the economy.
Today, real estate and the property market remain very attractive sectors for investors. A major share of investment in excess of $230 million was channeled into this sector in 2017, and in large part through the Invest Hotel Scheme and the Property Development Scheme. It is noteworthy that the real estate sector generates positive spillovers to the economy in terms of job creation and boost to the construction sector.
The medical industry is becoming increasingly popular due to the quality and diversity of treatments available in Mauritius. The combination of state-of-the-art medical services coupled with well-trained medical practitioners across various specialties is amongst the factors that have contributed to this new growth.
Another nascent sector that is rapidly developing and emerging is the film and creative industry: 61 international films have been shot in Mauritius so far, and we are now looking at entering the post-production market. This promising sector is considered as a new driver for economic growth.
It should also be highlighted that, by virtue of its membership to COMESA, SADC, AGOA, and by being party to free trade agreements with Turkey and Pakistan, and to the EU Interim EPA, Mauritius enjoys preferential market access to almost 2 billion consumers across the globe, adding up to a combined GDP of $40 trillion, including consumers in fast emerging markets such as India and China. This enhances our value proposition for attracting goods producing industries and logistics companies to set up base in Mauritius. And we have a number of incentives and schemes for these types of industries.
How is Mauritius future-proofing its workforce?
As Mauritius aspires to become a high-income country, we are looking at promoting a knowledge-based and innovation-driven economy. We are leveraging on emerging trends to attract and secure the top talent of tomorrow, whilst making sure that disruptive technologies and automation do not become a threat to employment.
Since we cannot predict the jobs of the future, Mauritius is aiming at nurturing an agile and flexible generation of students who are able to adjust to the ever-changing dynamics of the economy. Mauritius is also pursuing its strategy of further opening its shores by encouraging foreign talents, expertise, and know-how into the economy for the benefit of our bright minds and young professionals.