Sophistication Spurs Rise to Financial Center of High Standards

In about 30 years, Mauritius has leapfrogged from a monocrop economy on the sidelines of Africa into a highly diversified economic base that has become a leader of the continent's emergence.

Today, it is not sugar, but manufacturing, information and communication technology, logistics, financial services and tourism that drive the economy, which expanded 3.6 percent in 2016, according to national statistics.

Mauritius draws strength as a rising financial jurisdiction from this diverse economic base. According to the latest government figures, financial services represent 12 percent of GDP, compared to manufacturing, the country's largest sector, which makes up 14 percent of economic activity.

This balanced mix of industries provides Mauritius with economic resilience while engendering an environment of increased financial sophistication.

"We are offering to the world a financial center of excellence," said Harvesh Seegolam, chief executive at the Financial Services Promotion Agency of Mauritius. "That means that we meet, operate and adhere to all the best practices in place for financial centers globally."

The Mauritian government has been heavily focused on creating the necessary environment for foreign companies to incorporate themselves in the country and employ local professionals, local officials said.

Mauritius has accomplished this through an enviable corporate tax rate, set at a standard of 15 percent for individuals and businesses, and by applying best practices. For example, the financial services sector follows the Investment Promotion and Protection Agreements, which Mauritius signed with 36 other countries, allowing Mauritius-based entities to benefit from comprehensive protection against the expropriation of foreign assets.

Mauritius has also set plans in motion to improve support for the financial services sector by augmenting the local talent pool's skillset and infrastructure, as well as by updating institutional policy.

These improvements will help, yet investors point out the country's low levels of corruption and observance of the local legal system as the true cornerstones of its global competency.

"Today Mauritius is a well-respected, competitive and highly connected jurisdiction where the rule of law constantly prevails," said Kabir Ruhee, CEO of Rogers Capital, a Port Louis-based investment management firm. "This is in addition to being an investment-friendly country with a robust and modern regulatory framework with freedom of movement of capital," Ruhee said.

"Mauritius has recently brought in some fiscal incentives to promote global headquartering administration, treasury management center services, investment banking and asset and fund management activities."

Such incentives have made the jurisdiction an easy sell for finance and wealth management professionals, Ruhee said. "Today, Mauritius has the fastest-growing wealth market in Africa and ranks amongst the leading African countries in terms of talent attraction."Mauritius also benefits from double taxation agreements with 43 countries, including 14 in Africa, exemplifying the strong political relations it has developed with many nations across the continent

"If you look at the number of bilateral agreements that we have in Africa, there is a significant number of tax treaties and investment protection and promotion agreements," Seegolam said. "In China, the lookout for financial centers of substance such as Mauritius is certainly on the rise."

Source: China Daily

Published on 24th May 2017

 

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