In this exclusive interview with Mr. Poonoosamy, the head of the Economic Development Board of Mauritius, he reflects on the pivotal moments of his tenure. He highlights the EDB’s role in merging key agencies to streamline Mauritius’ business environment, resulting in international recognition from the World Bank’s Doing Business Report.
Under his leadership, the EDB implemented critical reforms, automated licencing processes through the e-licencing platform, and actively negotiated trade and tax treaties, fostering an environment that attracted millions of dollars in foreign direct investment in 2022.
Additionally, Mr. Poonoosamy underscores the EDB’s commitment to job creation, particularly in emerging sectors like ICT/BPO and financial services. He also outlines the strategic efforts to showcase Mauritius as a leading destination for these sectors on the global stage. Furthermore, he emphasises Mauritius’ role in strengthening economic relationships with Africa and other regions, highlighting initiatives, partnerships, and collaborations that have bolstered the country’s position.
Lastly, Mr. Poonoosamy details the unique advantages Mauritius offers to investors, including a competitive tax rate, simplified permitting processes, a multilingual workforce, robust legal and regulatory frameworks, and innovative incentives, positioning Mauritius as a trusted and attractive investment destination.
Mr. Poonoosamy, you’ve been at the helm of the Economic Development Board of Mauritius since 2017. Can you share with us some of the key moments of the journey?
The EDB was created in 2017 from the merger of Enterprise Mauritius, the Board of Investment, and the Financial Services Promotion Agency to ensure greater coherence and effectiveness in the promotion of the Mauritian destination.
The overarching role of the institution as provided in the Economic Development Board Act 2017 goes beyond trade and investment promotion and includes research, business facilitation, and advisory services, as well as creating the appropriate ecosystem for the development of key sectors of the economy.
It is known that a conducive business environment is key to attracting investors to Mauritius, and the EDB was responsible for the implementation of the reform’ agenda of the Government of Mauritius.
These reforms were commended by the World Bank, which ranked Mauritius in the 13th position in its Doing Business Report 2019. It is worth noting that a business process reengineering exercise was conducted by the EDB across 14 ministries to streamline the licensing procedures and requirements, and a regulatory review exercise is being conducted to ensure that the laws are in line with international best practices.
Also, the EDB is responsible for the implementation of the national e-licencing platform to automate and improve the delivery of public sector services and licenses. To date, 18 licences and permits have been onboarded on the e-licensing platform, spanning construction-related permits, work permits, and live permits. For instance, a total of 56,500 building land use permits have been issued from July 2018 to date.
To further strengthen and bolster economic growth, the EDB plays a pivotal role in the advocacy and negotiation of investment and tax treaties and free trade agreements, the latest being with China (Mauritius-China FTA in 2019), India (CECPA in 2021), and the African Continental Free Trade Area (2019). Today, the plethora of trade agreements that Mauritius has signed provide the country with preferential market access to nearly 75% of the world’s population. The EDB has been at the forefront of these negotiations, both on a defensive and offensive approach for our operators. Additionally, Mauritius has signed 44 investment treaties and 53 tax treaties, thereby offering investors a conducive environment for doing cross-border business and investments in a predictable, certain, and secure manner.
The COVID-19 pandemic took a toll on the world, and Mauritius, being a small island development state, has supported its economy and its people with various schemes put in place, such as the COVID-19 Vaccination Programme, whereby the EDB provided assistance to launch a “vaccination programme for business operators” as well as for the issue of the Work Access Permit. It is also worth noting that the EDB was also an important contributor to the measures put in place by the government to protect businesses and SMEs.
It is of paramount importance to highlight that the Freeport of Mauritius is ranked among the Top 10 Free Zones globally by FDI Magazine for the “Global Free Zones of the Year 2022” and 1st in Africa for two consecutive years in terms of the zone’s attractiveness, facilities, and incentives offered to investors. Three years in a row, the Mauritius Freeport has successfully been awarded once again as the best free zone in Africa from the fDi GFZ of the Year Awards 2023. This international recognition highlights the significance of a healthy public-private sector partnership in the sustainable economic development of the Mauritius Freeport & Logistics sector.
Attracting foreign direct investment is crucial for any country’s economic growth. Could you elaborate on the strategies and initiatives you’ve implemented that have resulted in attracting millions of dollars in foreign direct investment in 2022?
In 2022, FDI reached MUR 27.7 billion, compared to MUR 18.5 billion in 2021. This represents a significant increase of over 50% year on year and has exceeded the pre-COVID high of MUR 22.3 billion. Given the nature of investment, the high level of FDI recorded is also a reflection of the current and future health of our economy in terms of growth and stability. This will potentially lead to further FDI inflows in the coming year. We have not only consolidated FDI flows in our existing sectors like real estate, but we have also diversified into emerging sectors such as education and arts and entertainment, which have grown by more than 30 fold.
Similarly, there was sustained growth in our traditional source countries, such as France, the UK, and South Africa. We have also tapped into new markets such as North America, which has exhibited an increase of nearly 10 folds, while increasing visibility in emerging markets such as the Middle East and India so that we can sustain the inflow of FDI to our shores.
The government has implemented a number of strategies to restore confidence in the investor community, including further opening the country, pursuing reforms for ease of doing business, securing market access to emerging markets, and consolidating existing sectors while providing the right ecosystem for emerging sectors such as education, health care, and energy to thrive.
At the same time, post-COVID, the EDB has deployed an aggressive marketing and promotional strategy to position Mauritius as a trusted and reliable jurisdiction for the export of goods and services and as a platform of choice for cross-border investment.
Creating jobs is a vital aspect of economic development. Can you give us insights into how the EDB has contributed to job creation in Mauritius?
The EDB is striving to diversify the Mauritian economy by encouraging growth in sectors beyond traditional industries and by embracing emerging sectors such as digital industry, technology, renewable energy, pharmaceuticals, and financial services technology, thus creating new avenues for job creation.
By way of example, the ICT/BPO sector has moved up the value chain over the last decade and continues to be one of the largest employers in the country, with more than 32,000 people, mostly young and dynamic professionals.
Similarly, Mauritius has seen significant growth with an employment of around 15,000 professionals in its financial services sector, particularly in global banking, insurance, and fund management.
The EDB has put several measures in place to further encourage job creation in the country:
Mauritius is becoming known as a leading destination for ICT and financial services. What specific measures have you taken to showcase the country’s strengths in these sectors to a global audience?
The ICT/BPO industry plays a crucial role in the economic development of the country, as it represents 5.9% of current GDP. The growth performance has been impressive despite challenging economic developments. The industry, which comprises 900 companies, has reached a level of maturity that enables it to compete at a global level.
The adoption of strategic marketing campaigns with a clear and compelling message has been instrumental in showcasing the country’s ICT strengths and also increasing awareness among key outsourcing decision-makers about the country’s competitiveness.
EDB has participated in a number of focused and targeted investment and export promotion missions in key markets such as France, India, the UK, and South Africa, among others. The aim of these missions has been to promote the country as an investment destination in the ICT/BPO sector as well as improve the visibility of our island as a trusted partner for the delivery of ICT/BPO-related services.
Digital and traditional media and platforms are also being increasingly leveraged to reach a global audience. In the spirit of fostering partnership, EDB also collaborates with tech industry associations and chambers of commerce to jointly promote the industry on the global stage and for increased brand visibility, thus having a meaningful impact on the industry. The support and collaboration of industry influencers, experts, and thought leaders in the field are also being sought to create and share content.
Besides participation in targeted and focused tech events, ICT-specific events and seminars are also being organised locally to promote and create more visibility for the industry’s key offerings.
Similarly, the financial services sector boasts more than a decade’s track record in cross-border investment and offers an unparalleled, well-regulated, and transparent platform. Over the past 30 years, the Mauritius International Financial Centre (IFC) has gone through several strides and adapted to several changes, which have boosted the jurisdiction up the value chain by enhancing substance and increasing the depth and breadth of services that are offered.
The EDB has organised various targeted financial services promotional missions and multi-sector roadshows in key markets such as South Africa, India, and the United Kingdom to enhance the visibility of the Mauritius IFC. The EDB is also very present at specialty financial services conferences.
It is noteworthy that a digital marketing strategy has also been rolled out for the promotion of the Mauritius IFC, including the development of a Mauritius IFC website that provides a comprehensive digital window on all aspects of the financial services sector of Mauritius, including laws, schemes, service providers, events, and links to related agencies. For the period February 2022 to June 2023, the Mauritius IFC website has attracted over 10,900 visitors from over 115 countries.
Building economic ties with other regions is a strategic move. Could you shed light on the ways in which you’ve strengthened Mauritius’s economic relationships with Africa and other regions under your leadership?
Mauritius has an umbilical cord with Africa and has forged strong partnerships with several African states. Over the last few years, many African countries have embarked on a process of transformation, experiencing unprecedented rates of growth, a rise in trade and investment, and structural transformation. In the 1990s, Mauritius emerged as an outward investor, and it is evident that Mauritian-owned assets in Africa are bringing economic dividends to our country. Being a small island economy, the country is highly dependent on foreign relations and advocates regional integration premised on its membership in the African Union and regional economic groupings. There is a need to further strengthen and widen our collaboration with other African countries and tap into our appurtenance to Regional Economic Communities (RECs) to bolster economic diplomacy.
To that purpose, the government’s strategy is to reinforce our economic collaboration with African States and leverage the geostrategic position of Mauritius to drive investment into the continent. It has already embarked on several initiatives to cement our relations with most African States, including:
It is also noteworthy that the EDB became a member of the World Alliance of International Financial Centres (WAIFC) in 2019, and we are currently spearheading the Africa Roundtable of the WAIFC, which represents WAIFC’smembers in the African Continent, including Casablanca Finance City, EnterpriseNGR Lagos Financial Centre, and Rwanda Finance. The Africa Chapter is meant to promote Africa’s financial centres, financial services, and cross-border business in the region and to drive impactful investments from around the world to the continent.
Furthermore, the EDB and the Eastern Africa Association inked a memorandum of understanding in March 2023 in order to formalise the commitment of both the EDB and the EAA to collaborate and support one another in carrying out their respective responsibilities, as well as to assist in promoting Mauritius to investors in Eastern Africa.
In the pursuit of attracting more investment, could you share some of the unique advantages that Mauritius offers to potential investors that set it apart from other destinations?
The Mo Ibrahim Index of Good Governance, the Democracy Index of the Economist Intelligence Unit, and the Index of Economic Freedom of the Heritage Foundation, among other internationally acclaimed indices, all converge in acknowledging Mauritius as a safe and competitive jurisdiction.
We offer a progressive and competitive tax rate for foreign investors, a simplified process for obtaining all permits, a multilingual workforce, and state-of-the-art infrastructure in banking, telecommunications, and transport.
Our legal and regulatory framework satisfies the strict exigencies of cross-border capital movements. Inspired by international best practices, our laws allow the free movement of capital and the acquisition of property and ensure access to independent courts of law. Our wide range of international investment agreements and bilateral agreements provide protection to international investors.
Mauritius is today recognised as a jurisdiction of substance and a renowned international financial centre, with a robust anti-money laundering and countering the financing of terrorism (AML/CFT) regulatory and supervisory framework. We have a well-regulated banking system, with a number of international banks having footprints in the country.
In view of promoting pioneering and innovative industries, the premium investor certificate has been introduced to enable companies with a minimum investment of USD 12 million to benefit from bespoke incentives, including rebates, exemptions, and preferential rates in relation to taxes, duties, fees, charges, and levies, as well as a range of other facilities and grants.
Mauritius also welcomes potential investors, professionals, and digital nomads to carry out business or work remotely with the Premium Travel Visa. In addition, the Occupation Permit is available to expatriates seeking to work and live in Mauritius and make it their second home. It is a 10-year residency permit open to investors, retirees, professionals, self-employed entrepreneurs, and their families.