Mauritian Economy
Since independence in 1968, Mauritius has developed from a low-income, agriculturally based economy to a middle-income diversified economy with growing industrial, financial, and tourist sectors. For most of the period, annual growth has been in the order of 5% to 6%. This remarkable achievement has been reflected in more equitable income distribution, increased life expectancy, lower infant mortality rates, and a much-improved infrastructure. The economy rests on sugar, tourism, textiles and apparel, and financial services, and is expanding into fish processing, information and communications technology, and hospitality and property development. Sugarcane is grown on about 90% of the cultivated land area and accounts for 15% of export earnings. The government's development strategy centers on creating vertical and horizontal clusters of development in these sectors. Mauritius has attracted more than 32,000 offshore entities, many aimed at commerce in India, South Africa, and China. Investment in the banking sector alone has reached over $1 billion. Mauritius, with its strong textile sector, has been well poised to take advantage of the Africa Growth and Opportunity Act (AGOA).
According to the CIA World Fact book the GDP of Mauritius is $15.36 billion (2008 est.), with the GDP, real growth rate being 5.2% (2008 est.). The unemployment rate is 7.6% (2008 est.).
Of the total $81 billion FDI that has entered into India since April 2000, $35.18 billion was routed through the Mauritius route, according to the Indian Department of Industrial Policy & Promotion. India gets 43% FDI through Mauritius route making Mauritius the most preferred route for FDI inflows in India although the latter having many DTA’s with other countries.
The Mauritian currency is the Rupee (MUR). Exchange controls were relaxed in stages between 1984 – 1994, the exchange rate at date of publishing was US $1 = MUR 33.46. Investors are still required to demonstrate the source of funds to be repatriated, and must be up to date with local taxation.
The Island Republic has a good labour relations record and productivity has shown a 5% annual increase since 1994. Training and service quality are regarded as important; many Mauritian firms have adopted ISO 9001. Financial and professional services are well represented and a successful stock exchange was opened in 1989.
Most recently Mauritius has topped the first annual Ibrahim Index of African Governance, prepared and compiled by Kennedy School of Government at Harvard University, by being rated as the best run country in Africa, out of a total of 48 countries surveyed. Mauritius was followed by Seychelles, Botswana, Cape Verde and South Africa. The criteria used in the rating, including security, human rights, economic stability, just laws, free elections, corruption, infrastructure, poverty and health.
In addition to the African Governance survey, Mauritius has also recently been rated as the 24th easiest country to do business in, out of a total of 181 economies surveyed by independent international report. View report here. Moreover, press release from the IMF early in 2009 states that the island’s macroeconomic fundamentals are solid and that economic growth reached its highest level in a decade in 2008 and that while banks in many countries have come under severe stress, the Mauritian banking system has remained well capitalized and liquid. View Press Release here.
