Let me make a confession. I have a soft spot for business destinations in Africa that offer diverse opportunities at low risk. This is precisely why in today’s post I want to introduce some interesting aspects of doing business in Mauritius to you.
Mauritius is an island with a total of 1.3 million inhabitants and this means it has a very small market size. This is a limiting factor for many businesses. But fact is that Mauritius is becoming increasingly popular among companies as a strategic HQ or regional base for Sub-Saharan Africa – Southern and Eastern Africa in particular. And after you have finished reading this post, you will completely understand the reasons behind that.
Mauritius is continually reinventing itself. By leveraging its strategic position at the crossroads of Africa, Asia and Australia, Mauritius is gradually transforming itself into a hub and an international jurisdiction for investors in search of security, transparent regulation and high value-addition. In short, it is a gem that is still widely overlooked.
Let’s change that and let’s see what Mauritius has to offer !
1. Ranks highest in Africa for ‘ease of doing business’
According to the World Bank, Mauritius has Africa’s highest ranking for the ease of doing business: it ranks at 28th place among 189 economies worldwide. In fact, in 2014 it was even among the world’s top 20. This goes a long way in Africa where wide-spread red tape bureaucracy, corruption, and lack of security pose a long-term challenge. Well, in Mauritius this will be less of a worry (in other words: you can use its breathtaking beaches and relax).
2. It is on a pursuit to become a high-income country in Africa
In its pursuit to become a high-income economy, Mauritius is actively encouraging foreign talents, know-how and investment into the country. Foreign nationals wishing to work, live or retire in Mauritius may explore various avenues either through the Occupation Permit, the Residence Permit or the Permanent Residence Permit.
It has introduced a new law in this regard in 2006 and since then the country experienced an immigration spike with 17,000 foreign nationals flooding in to live and work in Mauritius. Most of them are professionals, followed by investors, business owners and those who have retired. This means that the country has won incredible skills and talents, which will make a positive impact on your ventures.
3. The island is a low-tax jurisdiction
Mauritius officially has a corporation tax of 15%, but tax credits for global business companies bring the rate down to 3% respectively. Incorporations pay no capital gains tax and no withholding tax on dividends. Mauritius has taken steps to aggressively position itself as the “gateway to Africa” for companies looking to invest in the continent. In the beginning of 2014 it had 14 double taxation treaties in place with African countries and a further 10 under negotiation. There has been a bit of a discussion going on accusing Mauritius of making space for companies looking for tax avoidance, in fact, it’s being referred to as a tax haven by many.
The Mauritius government is defending its position. The vice prime minister and finance minister in Mauritius Xavier-Luc Duval said: “We’re not a tax haven because there is no secrecy. You can’t open a bank account here without giving your full details.” Mr Duval supports the notion of Mauritius as a low-tax jurisdiction. “Every time we’ve brought down the tax rates, tax revenues have increased, so it’s been done for genuine reasons. For a country like Mauritius, with no large government expenditure on the military, there is no need to overburden the population with taxation” he states.
4. It offers very diverse business and investment opportunities
One may think that there is not much opportunity this island has to offer. But Mauritius is marching relentlessly towards increased economic growth and market success. It also increases its numbers of investment projects on the continent and has just recently signed a MoU for the building of an ICT technology park in Accra, Ghana. Here is a list of the country top industries (compiled by the Board of Investment Mauritius) for all of you who want to look into doing business or investing in Mauritius; either targeting the national market or using the island as a base to launch related ventures in Eastern and Southern Africa.
Agro-Industry
Aquaculture & Seafood
Education & Healthcare
Financial Services
Hospitality & Property Development
ICT-BPO
Logistics
Manufacturing
This is my list about some of the great and unique advantages that Mauritius can bring onto the table when doing business in Africa. And lastly: Well, who really minds the beautiful scenery and beaches to top this up?!
Would be great to get your feedback and questions! And if you’d like to get my latest articles on Africa business opportunities and tips as soon as they are published, feel free to click the little box ‘Notify me by e-mail’ below the comment section.
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