Analysing mechanisms to promote economic integration, to address the persisting economic impacts
of colonialism with special emphasis on the African Continental Free Trade Area (AfCFTA)
Mauritius
https://www.heritage.org/index/country/mauritius
https://www.worldbank.org/en/country/mauritius/overview#1
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ional%2F634310PUB0Yes0061512B09780821387450.pdf&clen=417228&chunk=true
https://www.euromoneycountryrisk.com/article/b1w6j5bn79f8nd/country-risk-mauritius-is-one-towatch-in-2022
https://country.eiu.com/mauritius
https://tradingeconomics.com/mauritius/gdp#:~:text=In%20the%20long%2Dterm%2C%20the,accordi
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Why Mauritius holds the kye to the World’s Largest Free Trade Area
There is no doubt that 2021 is a year that has been a long time coming, and one that is likely to
determine not just the fate of free trade in Africa, but also of the world at large. With COVID-19 pushing
nations into an unfortunate mindset of isolationism and nationalism, the African Continental Free Trade
Area (AfCFTA) represents a much-needed sliver of hope.
As with many landmark agreements, the journey to AfCFTA’s implementation has been anything but
smooth. While this game-changing agreement was first signed on 21 March 2018 by 44 of the African
Union’s 55 member states, the pandemic led to unavoidable delays in the preparatory process, and so
its launch was finally realised on 1 January 2021.
All about AfcCFTA
AfCFTA is the most ambitious regional integration project to date, with a significant potential for
economic transformation across Africa. Connecting 1.3 billion people across 55 countries with a
combined gross domestic product (GDP) valued at US$3.4 trillion, the pact will create the world’s largest
free trade area measured by several participating countries.
At Bank One, we remain cautiously optimistic that AfCFTA will facilitate much-needed growth in intraAfrica trade. Currently, only 17% of African exports are intra-continental, compared with 59% for Asia
and 68% for Europe. AfCFTA will eliminate 90% of tariffs, boosting intra-continental trade by 52%
annually over five years.
Where Mauritius comes into the picture
Mauritius was a fast mover in joining existing regional Common Markets such as the Common Market
for Eastern and Southern Africa (COMESA) and the Southern African Development Community (SADC).
Moreover, while the Indian Ocean island is located about 2,000 km from the East Coast of Africa, the
post-independence economy took a conscious call to identify itself more with Africa than India – where
a large part of its 1.3 million population hails from.
Thus, Mauritius is both geographically and strategically well-positioned to harness the potential of
AfCFTA and act as a nexus along the India-Africa and the China-Africa Trade Corridor, leaning on its
newly implemented agreements with India and China by way of the Comprehensive Economic
Cooperation and Partnership Agreement (CECPA) and the Mauritius-China FTA respectively.
A regional trade hub
Many foreign entrepreneurs have set up ventures in Mauritius to avail of the trade advantages offered
through its membership of the SADC and the COMESA. For instance, the Mauritius Freeport, a taxefficient modern logistics hub offering incentives to operators, has been largely built on the benefits of
its SADC and COMESA memberships.
With AfCFTA entering into force, the Freeport also offers access to the free market, although rules of
origin and local value addition will apply, as prescribed therein. Indeed, Mauritius could import goods in
semi-finished form, add value in the jurisdiction, and then re-export them to mainland Africa.
Unlocking investment flows to Africa
With South Africa’s recent downgrade making Mauritius one of the few remaining investment-grade
countries in Africa, the jurisdiction is well poised to act as the de-facto offshore financial centre for the
region such that all FDI, trade and investment flows are channelled through its shores.
In particular, as AfCFTA boosts investments in trade-related infrastructure, the island economy is well
placed to support private equity funds in various verticals including infrastructure. Large trading
multinationals are also likely to favour Mauritius as their regional headquarters, whether to avail of its
attractive headquarter regime or facilitate procurement and treasury management.
The fact that Mauritius is in the process of renegotiating Double Taxation Avoidance Agreements and
Investment Promotion and Protection Agreements with over 20 African countries simply adds to its
appeal as an investment gateway for Africa.
Africa’s Arbitration Centre
Furthermore, from a governance and legal perspective, Mauritius is considered a safe shore, being
home to leading international arbitral institutions such as The London Court for International Arbitration
(LCIA), the Mauritius International Arbitration Centre (MIAC) and the Permanent Court of Arbitration
(PCA).
Add to that the fact that Mauritians are bilingual, the island is in an ideal time zone for international
customers along with a favourable geographic location vis-à-vis South Asia, Australia and New Zealand –
and you have all the ingredients for the jurisdiction to set itself up as the de-facto arbitration centre for
Africa.
Exploring Africa’s Blue Economy
Finally, 38 of Africa’s 54 States are coastal, and over 90% of Africa’s imports and exports are conducted
by sea. The African Union rightly calls the Blue Economy the “New Frontier of the African Renaissance”.
This is where the true test of AfCFTA will lie: in bringing the continent together to tap into the resources
of its vast ocean economy.
Here, the fact that the Mauritius Ports Authority is extending its deep-water harbour in Port Louis to
explore the potential of the untapped ocean economy in Africa gives Mauritius another unparalleled
advantage in leveraging the full benefits that AfCFTA offers.
The overall banking sector in Mauritius is gearing up to accommodate FDIs as a springboard into African
investment. At Bank One, being present both onshore and offshore, we aim to leverage Mauritius’
position as an international financial centre and the reach of our shareholders to serve the rising
Financial Institutions (FIs) and Corporates as well as the Wealth Management and Custody Services
needs of our clients in key Sub-Saharan African (SSA) economies.
As such, Bank One aims to be the ‘Bank of Choice’ for FIs in SSA with a key focus on the following areas:



Leveraging our geographic position in Mauritius as a springboard for African Investments and
Trade Financing;
Creating a ‘Star Alliance of Banks’ with a unique value proposition to serve the needs of our SSAfocused clients;
Deepening our network of global correspondent banks for Treasury, Wealth Management,
Securities and Custody Services to support the SSA Market; and

Supporting the short-term liquidity requirements of SSA FIs and Central Banks.
Since Mauritius as a jurisdiction has been positioning itself for the advent of the world’s largest free
trade area, Africa-focused banks such as Bank One have a unique opportunity to support market players
in realising the huge opportunities unlocked by AfCFTA.
However, for these benefits to be explored to their true potential, we need a concerted effort to engage
with all other partners and create awareness of the advantages of the jurisdiction. At Bank One, we look
forward to playing our part in delivering the exciting chapter of intra-African trade and cross-border
investment that is unfolding on the back of AfCFTA.
The World Bank officially classified Mauritius as a high-income country in July 2020. Another possible
reason is low taxes, including no inheritance tax or capital gains tax, making the island attractive to
retirees. Safety is also one of the key drivers of wealth growth in Mauritius.
Mauritius is the wealthiest country in Africa on a wealth per capita basis, according to a new report
commissioned by Mauritius-based AfrAsia Bank in conjunction with wealth intelligence firm New World
Wealth.
Mauritius had about 1.6 million inhabitants in 2020, compared to 59.31 million in South Africa. The
average wealth per capita in Mauritius is US$30,000 per person, while South Africa was in second place
with US$11,000.
Key findings in the report include:
Total private wealth held in Africa amounts to approximately USD2 trillion as at December 2020.
The ‘Big 5’ wealth markets in Africa are: South Africa, Egypt, Nigeria, Morocco and Kenya – together
these five countries account for over 50% of Africa’s total wealth. South Africa is home to over twice as
many millionaires (HNWIs) as any other African country, whilst Egypt has the most billionaires on the
continent.
Mauritius remains the wealthiest country in Africa with wealth of capita exceeding USD30,000 per
person. The island was officially classified as a high-income country by the World Bank in July 2020.
The COVID-19 pandemic had a severe impact on Africa resulting in a decrease of about 9% in private
wealth and HNWI levels in 2020. This drop was driven by salary cuts and job losses in the travel,
hospitality, manufacturing and real estate sectors, closure of local businesses, weakening of the
residential property market and rising household debt.
Total private wealth held in Africa is expected to rise by 30% reaching USD2.6 trillion by 2030. This
growth will be driven by strong growth in the billionaire and centi-millionaire’s segments in fast growing
economies such as Ethiopia, Mauritius, Rwanda, Kenya and Uganda.
The report expects wealth growth of 80% in Mauritius up to 2030. This will make it one of the five
fastest-growing high-income markets in the world over this period, along with Australia, New Zealand,
Switzerland and Malta.
Apart from a large number of high net-worth individuals (wealth of USD1 million or more) moving to
Mauritius over the past decade, the growing economy has enabled more locals to move into this wealth
category. Mauritius is now home to around 4,400 HNWIs, compared to 2,500 HNWIs a decade ago. The
report expects that by 2030 Mauritius could have more than 7,800 HNWIs.
Reasons for Mauritius ranking top in Africa proposed in the report include ‘ease of doing business’.
Mauritius, it said, ranks first in Africa and 13th worldwide in the World Bank’s 2020 Doing Business
Report. The World Bank officially classified Mauritius as a high-income country in July 2020.
Another possible reason is low taxes, including no inheritance tax or capital gains tax, making the island
attractive to retirees. Safety is also one of the key drivers of wealth growth in Mauritius. It is rated as the
safest country in Africa, along with Namibia and Botswana.