The rise of the island paradise - CNBC Africa

The rise of the island paradise


by Chris Bishop 0

From the moment you step on the plane you know Mauritius means business.

You know, most countries in the world have a landing card that could blow away in a gentle breeze – the kind of flimsy paper that you expect to be handed through the window of your car at the traffic lights.

Mauritus hands you thick bonded paper, in full colour, printed in two languages. You could pass it off as a share certificate or put it on the wall and claim it as a qualification. It is a sign of how ambitious Mauritius – heavens, it even rhymes - can be meticulous when it comes to business.

Business in Mauritius has been in its rise over the last 30 years. In the 1970s, after independence, Mauritius was derided as the complete colonial backwater. A sugar republic and a mere boat stop on the Indian Ocean, which few gave much chance.

Fast, forward three decades later and the tiny island has confounded the critics and made itself into a modernised and forward looking economy. The sugar has almost left the republic, a mere 1.2 per cent of the economy according to the Bank of Mauritius. It has a cyber-city bursting with banks and silicon companies and a thriving export processing zone. More than half of what Mauritius produces is exported. The low flat tax rate, of 15 per cent, helps with foreign companies allowed to claim tax rebates bringing this rate down to an effective 3 per cent.

The future is full of plans: There is talk of windmills floating at sea and powering the whole island, greater harvest of sea food and the plants that grow underwater; there are plans to set up the first ever electronic pan African exchange in Port Louis. The people with money here say the island could become the Singapore of the Indian Ocean. 

“The only difference between Singapore and Mauritius is that they had oil and we had sugar,” said the head of economic research at the Bank of Mauritius.

It all looks good, but Mauritius also has to slay its fair share of dragons. Elections loom next year, where once again the country’s leaders will likely have to patch together another complicated coalition. There is also talk of an electoral reform before a vote is cast.

“It would be more useful to come up with more business reform,” says one of the business-type cynics on the island. Many believe Mauritius, one of the easiest places to do business in Africa where you can open a business in weeks, needs to do more to attract foreign investors.

Then there’s isolation. Mauritius is a three hour flight from anywhere. It needs more flight if it is to increase business.

Last, but not least, there is the fact that Mauritius is a very small place where it matters much who you know. I imagine, if you upset the powers that be, Mauritius can be a very lonely, if warm, place.

If all can be put right – who knows?