In the last few years, Mauritius has emerged and positioned itself as being an international financial centre (IFC) of excellence, choice, and repute. Located off the southeast coast of Africa, neighboring the French island of La Reunion, Mauritius is an island state of about 1.3 million people. Mauritius has evolved from humble beginnings as an agricultural economy to an increasingly attractive global investment destination.
Investors choose to start a business in Mauritius in order to benefit from the island’s strategic position and numerous fiscal and non-fiscal advantages. Discover why international investors and entrepreneurs elect Mauritius as their prime destination to start a business and why the country is booming with potential.
Mauritius offers a conducive business environment
Mauritius has a strong, competitive, and diversified economy with a highly qualified and bilingual (English and French) workforce. The island’s success can be attributed to the country’s free-market economy. Mauritius has a very high Human Development Index rating, ranking 66th worldwide and first in Africa.
Mauritius became a High-Income Country in July 2020, according to The World Bank. “However, it slipped back into Upper-Middle-Income status in 2021 due to the impact of the Covid-19 pandemic […] and is expected to gradually rebound “as travel restrictions are eased…, and continued recovery of manufacturing exports in line with global demand, and uptakes in construction, wholesale trade, and financial and insurance services.”
Incentives to starting a business in Mauritius
Mauritius has 45 Double Taxation Agreements (DTA’s) in force – treaties to avoid international double taxation on income and property – with countries across the world.
Furthermore, entrepreneurs and investors can export commodities and services and enjoy a simple and attractive tax regime. Investment incentives implemented by the government for both domestic and foreign investors are designed to encourage investment. Some of those incentives include:
- 100% foreign ownership
- Investment and business-friendly country (1st in Africa in the World Bank Doing Business Report)
- A well-established network of Investment Promotion and Protection Agreements (IPPAs)
- Member of trade organizations that include the Southern African Development Community, Common Market for Eastern and Southern Africa, African Union, and African Continental Free Trade Area)
- Good governance
- A qualified workforce at a competitive rate, and fluent in English and French
- A comprehensive range of banking services with the presence of international banks
- Cost-effective company set-up and office rental costs
- Ideal geographical location for international transactions (GMT+4)
- Free repatriation of profits, dividends, and capital
- No minimum foreign capital needed
- No capital gains tax
- Corporate and Individual income tax rate at 15%
- Exemption from customs duty on equipment for companies involved in trading (importing) activities
- Tax holidays on certain activities
In addition, Mauritius is a signatory to various Investment Promotion and Protection Agreements (IPPAs) which enhance two-way investment flows and boost their economy, by guaranteeing investments are safe from expropriation and other local shocks to which they could be exposed.
Live, work, and play in Mauritius
Mauritius is an attractive island for investors and business owners to live, work, and play. Mauritius offers foreign nationals an Occupation Permit (OP) – a combined work and residence permit that allows a non-citizen to reside and work in Mauritius.
Investors relocate to Mauritius to not only invest and conduct business but also to live and work. In fact, foreigners who buy a property worth more than $375,000 are entitled to a permanent residence permit.
Any foreigner can start a business in Mauritius as a fully owned entity. The business can operate in-country and outside of Mauritius. Different types of companies can be set up in Mauritius, such as the regional headquarters of a multinational company or an investment fund.
To determine the appropriate structure, consult a professional services firm such as Sunibel Corporate Services to receive guidance on corporate, trust, fund, and fiduciary services and cross-border investment structuring and administration.
In addition to the dynamic business ecosystem in Mauritius, the island offers a favorable and secure living environment, pleasant climate, exotic scenery, and beautiful beaches.
A strategic opportunity to connect with Africa and Asia
The African Continental Free Trade Area (AfCFTA), which Mauritius signed with other African countries, represents an ideal opportunity for investors to connect to millions of potential African consumers.
Africa represents 2% of global trade and a boost in world trade is likely to increase potential revenue. The advantage of this agreement is that investors can get preferential access to specific products from Africa. All imports entering Mauritius from an AfCFTA member state are wholly exempt from customs duties.
Investors fromAfCFTA member states gain preferential access to the Chinese market of more than 1.4 billion potential customers to export goods and services.
In 2021, Mauritius signed a Free Trade Agreement with China, which covers over 40 service sectors and gives duty-free access to the Chinese market – over 7,000 products. As a result, companies based in Mauritius can also be established in China either as owned entities or through partnerships with Chinese entrepreneurs.
Establishing an e-commerce company in Mauritius
Mauritius is gradually transitioning into a digitally enabled economy. With the exponential growth of e-commerce activities, especially in Africa, Mauritius plays an important role in structuring investment in the sector across Africa.
Mauritius has also emerged as an international and competitive ICT (Information and Communications Technology) destination and is steadily positioning itself as a regional ICT Hub.
According to the Mauritius Economic Development Board, “The ICT/BPO industry represents a key driver of the Mauritian economy with a GDP contribution of 7.4% for 2021 and employing around 30,000 people. With some 850 ICT-BPO based enterprises, the country has one of the richest technology ecosystems in Africa that thrives on innovation and collaboration across sectors.”
Meanwhile, the introduction of the Custodian Services Licence for Digital Assets and the Virtual Assets and Initial Token Offering Act puts Mauritius at the forefront of the digital assets and fintech industry in Africa.
Mauritius was recently selected as the happiest country in Africa in the 10th edition of the World Happiness Report, a publication of the United Nations Sustainable Development Solutions Network. The report ranks 146 countries in their overall happiness and highlights which countries are the happiest or unhappiest.
Overall, Mauritius has emerged as a country to watch throughout the last few years, and it is booming with potential. Given the conducive business environment, numerous incentives, strategic opportunities, and industry growth Mauritius is set to be a leading destination for investment and business creation.
Matthieu Félix is a marketing and communication enthusiast who has helped a number of companies establish their offline and online presence. Born in Mauritius, Matthieu is eager to promote his country and all that it has to offer in terms of business and investment, lifestyle, and tourism.
© YFS Magazine. All Rights Reserved. Copying prohibited. All material is protected by U.S. and international copyright laws. Unauthorized reproduction or distribution of this material is prohibited. Sharing of this material under Attribution-NonCommercial-NoDerivatives 4.0 International terms, listed here, is permitted.