THE MAURITIAN MIRACLE
Beneath the palm fronds, the subtropical island is transforming itself into an economic powerhouse
With its turquoise lagoons, languid stretches of white sand beaches and lush mountain vistas, idyllic Mauritius has long been a honeymooners’ paradise for South Africans, but has for many years been overlooked as an investment destination. The island nation of just 1,26 million people celebrated its 50th year of independence from English rule in 2017, yet – over this relatively brief period – it’s managed to achieve socio-economic stability and success.
Like SA, Mauritius boasts a rich tapestry of ethnicities and cultures, but while the Rainbow Nation continues to be buffeted by economic headwinds, the Indian Ocean island has cultivated a business-friendly environment alongside a strong welfare system to engineer GDP growth.
According to a study from intelligence firm New World Wealth, the number of millionaires on the offshore island of Mauritius has grown by 20% in the past year, making it the fastest-growing wealth market in Africa. The report, which details the performance of high-net-worth-individuals (HNWIs) in selected African countries from 2006-2016, placed Mauritius at the top in the continent for HNWIs, with a growth of 230%. HNWIs refer to individuals with wealth of $1 million or more. It’s estimated that 280 millionaires have moved there from SA alone since 2006.
“Individuals living in Mauritius are free to invest overseas (with no exchange controls). This encourages wealthy people to use the country as a business and investment hub,” the report states.
It’s already regarded as the best-performing economy (recognised by the World Bank) and boasts the highest per capita wealth of $25 700, more than double that of second-placed SA, according to the report. The World Economic Forum also ranks Mauritius as the most competitive market on the continent.
The island’s appeal lies in its strong fundamentals of political stability and economic growth, inviting tax regime and secure ownership rights, which are in stark contrast to other countries in the region. Compared with Asian tiger Singapore, the country’s built up a solid financial sector, specialising in offshore banking, fund management and private banking.
Thanks to its position in the Indian Ocean, Mauritius is today a hub for commerce, investment and tourism, connecting Africa, India and Asia with the rest of the world. In a convenient time zone, it’s open for business before the markets in the Far East close and after those of the USA open. Looking beyond SA, Mauritius has trade agreements with Senegal, Ghana and Madagascar, but is looking to establish trade relations with more African countries.
It also has a low barrier to gaining permanent residency. According to James Bowling, CEO of residency and citizenship by investment facilitator Monarch & Co, non-Mauritian citizens are eligible for a residence permit upon the purchase of a property under the Property Development Scheme programme with a minimum value of $500 000. A beachfront property can be picked up for as little as R2,5 million.
Theo Pietersen from Seeff Mauritius notes that the island is a “fantastic offshore property attraction for South Africans”.