Guidance

Overseas business risk: Mauritius

Updated 29 June 2023

1. Political

Mauritius is a stable democracy and has maintained the top position on the Mo Ibrahim Index for Overall Governance in Africa for ten consecutive years. The island became independent in 1968. Transitions of power have been smooth and peaceful.

Mauritius is a parliamentary democracy with a single legislative chamber modelled on the Westminster System. Executive powers lie with the Prime Minister and the President is the Head of State. The Judiciary operates independently from the legislative and executive branches.

Hon. Pravind Jugnauth became Prime Minister in January 2017 following the resignation of the late Sir Anerood Jugnauth. He is the leader of the Mouvement Socialiste Mauricien, the largest party in the ruling Alliance Lepep coalition, which was re-elected following the general elections in December 2019. The election cycle is 5 years.

2. Economic

As a small, open economy, Mauritius is affected by global economic trends, especially conditions in Europe and China. Over the years, the government has diversified the economy, which is based on exports of sugar, textiles, processed fish, tourism and financial services. Newer sectors include biotechnology, pharmaceuticals, and digital services to increase resilience. Europe still accounts for around half of Mauritius’ exports and tourism, and is a major source of investment. Trade with Africa has become an important part of the international economic strategy, but currently South Africa is the only African trading partner comparable to European trading partners.

Mauritius became a high-income country in July 2020 (based on 2019 data). However, the impact of the COVID-19 pandemic caused a slip back to upper-middle-income status in 2021. Like elsewhere in Africa, COVID-19 had a major economic impact with GDP contracting by 14.6% in 2020. GDP rebounded by 3.5% in 2021, and accelerated to 8.7% in 2022, supported by strong tourism recovery, investment in public infrastructure, and resumption of export activities. Growth is predicted to be around 8% this year.

Headline inflation rose from 4% in 2021 to 10.8% in 2022 – the highest in over a decade – driven by external supply shocks stemming from the war in Ukraine. This increased the prices of energy and food products, of which Mauritius is a net importer. High public sector debt (79% in 2022), a widening trade deficit, and unemployment (7.7% at the end of 2022) are other areas of concern.

Mauritius pursues a liberal and open economic policy. The country relies heavily on trade and investment with Europe and the US and more recently with markets such as India, China and South Africa.

Mauritius welcomes foreign investment in nearly all sectors of the economy and its nationals are free to invest elsewhere. In 2022, foreign direct investment (FDI) increased by 50% to MUR 27.7 billion (£505 million) compared to 2021. Real estate activities and education attracted the most FDI. France and South Africa were the main sources of FDI.

Mauritius is positioning itself as a regional hub for investment into Africa. So far, Mauritius has concluded 45 Double Taxation Avoidance Agreements (DTAA). As of January 2023, there were 12,616 live Global Business Companies (GBCs) operating in Mauritius. The value of their total assets was estimated to be USD 812 billion in 2021.

Mauritius is also establishing itself as a knowledge hub for Africa and attracts many international universities. There are approximately 35 UK universities and awarding bodies offering UK qualifications recognised in Mauritius and the UK. Following success in the local market, international marketing is attracting foreign students, especially from African countries.

3. Business environment

Mauritius is considered one of the most business-friendly countries in sub-Saharan Africa, as a result of its political stability, good governance and an independent judiciary. It ranked first in Africa and 52nd as the most competitive nation in the world out of 141 countries in the 2019 Global Competitiveness Report published by the World Economic Forum.

Mauritius ranked 13th on ease of doing business out of 190 countries in the World Bank’s 2020 Doing Business report, reinforcing its status of a business-friendly country.

The UK and Mauritius signed an Economic Partnership Agreement (EPA) with the Eastern Southern Africa countries, including Mauritius, on 31 January 2019. This entered into force on 1 January 2021.

Mauritius came off the Financial Action Task Force’s “grey list” in October 2021. It was removed from the UK’s list of high-risk countries in November 2021. The European Union officially announced removal of Mauritius from its list of “high-risk third countries” in January 2022. This de-listing has enhanced Mauritius’ status as a leading jurisdiction in the global financial services industry and reinforced its position as a notable investment destination and domicile of choice for structuring cross-border investment into Africa and Asia. Compared to other African countries, the risks of doing business in Mauritius are low. However, challenges have been reported in finding suitably qualified personnel for example, in the IT, telecommunications, medical and other specialised sectors.

Mauritius has well-qualified financial and legal personnel, most of whom trained in the UK, and benefits from a bi-lingual French/ English workforce. Local labour law can be complex, and companies are recommended to hire highly qualified human resource personnel.

The most important sectors of the Mauritian economy are textiles, tourism, financial and business services, information and communication technology, seafood processing, real estate development, renewable energy, and education/training. The Government of Mauritius sees innovation as the basis for long-term growth. Before COVID-19, authorities planned to stimulate economic growth in 5 areas:

• serving as a gateway for investment into Africa
• increasing the use of renewable energy
• developing smart cities
• growing the blue economy
• modernising infrastructure, especially public transport, the port and the airport

The Mauritius International Arbitration Centre (MIAC) that operated as a joint venture with the London Court of International Arbitration until 2018, brings a high level of dispute resolution services to the international community. MIAC has operated as an independent arbitration centre since July 2018, drawing on the significant expertise gained during this initial phase of its development. The Judicial Committee of the Privy Council in London is the final court of appeal for Mauritius.

For more information about setting up a business in Mauritius, please refer to the Economic Development Board and Department for Business and Trade (DBT) Country Guide for doing business in Mauritius.

4. Bribery and corruption

Bribery is illegal. It is an offence for UK nationals and bodies incorporated under UK Law, to bribe anywhere in the world. In addition, a commercial organisation conducting business in the UK can be liable for the conduct of a person who is neither a UK national or resident in the UK or a body incorporated or formed in the UK whether or not the offence takes place in the UK.

Mauritius ranked 57th out of 180 countries in the Transparency International’s 2022 Corruption Perception Index. Despite a decline in score and ranking from the 2021 Index, the country is often cited as Sub-Saharan Africa’s example of good governance and democracy. The 2022 Democracy Index compiled by the Economist Intelligence Unit to measure the state of democracy in 167 countries, considers Mauritius as the only full democracy on the African continent, ranking it first in Sub-Saharan Africa and 21st worldwide.

Mauritian governments past and present have implemented anti-corruption measures, including the establishment of the Independent Commission Against Corruption (ICAC) in 2002.

Weaknesses remain at the legislative level, particularly concerning regulations dealing with both private sector corruption and the funding of political parties.

There are ongoing investigations into alleged fraud and corruption in both the public and private sector.

5. Human rights

Mauritius’ Human Development Index was 0.8 in the 2019 report, putting the country in the high human development category, and positioning it at 66 out of 188 countries and territories.

Chapter II of The Constitution of Mauritius guarantees the protection of fundamental rights and freedom of the individual. A National Human Rights Commission was created under The Protection of Human Rights Act to deal with complaints of breaches of human rights listed in the Constitution and complaints against the Police.

Reported human rights issues in Mauritius include alleged mistreatment of suspects and detainees by the Police, domestic violence against women, and discrimination against minority groups including LGBT+ people.

The UK has worked with the Government of Mauritius, UK retailers, local manufacturers and NGOs to improve migrant workers’ rights in Mauritius. In 2019, the UK funded the publication of a guide to inform migrant workers of their rights and possible remedial actions in case of violations. The booklet called ‘Know Your Rights’ has been published in 6 languages.

The Equal Opportunity Commission became operational under the Equal Opportunities Act of 2008. It investigates allegations of discrimination and promotes equality of opportunity in both the private and public sectors. Mauritian law requires organisations employing more than 35 people to set aside at least 3% of their positions for persons with disabilities. Workers exercise their rights of freedom of association and the right to collective bargaining.

The law prohibits the employment of children under 16 years of age and prohibits the employment of children between 16 and 18 years old in work that is dangerous, unhealthy, or otherwise unsuitable for young persons. The government introduced a minimum wage in January 2018.

Female participation in the Mauritius labour force is approximately 45%, with a growing prevalence of dual income households. Women can generally enjoy an active social life and mixed-race marriages are not uncommon.

6. Intellectual Property

Infringement of copyright and intellectual property is not uncommon in Mauritius. It is recommended that trademarks and/or Intellectual property be registered to avoid fraudulent use. For more information on intellectual property and copyrights, please visit the UK Government website and the Attorney General’s Office (PDF, 291KB) for publications/legislation on the subject.

7. Protective Security Advice

Mauritius is generally a safe country. Read the latest FCDO travel advice.

8. Terrorism threat

Terrorist attacks in Mauritius can’t be ruled out. Read the latest travel advice in the terrorism section.

9. Crime

Petty crime, particularly theft, is common. Most crime is non-violent. Read the latest travel advice on safety and security.

The Mauritius Police Force is allowed to arrest and detain an individual on a provisional charge until investigations are completed, which can be a lengthy process. The UK government has previously raised concerns about the use of the provisional charge and the issue was also raised at the UN International Human Rights Council in 2014.

10. Contact

Contact the Department for Business and Trade team in Mauritius for more information and advice on opportunities for doing business in Mauritius.