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Economic diversification in Mauritius

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Economic diversification in Mauritius

Economic Diversification in Mauritius: Promising Investments

The Mauritian economy has relied on three main pillars for many years: financial services, tourism, and the manufacturing industry. These sectors, strong with their advantages, represent approximately 11.9%, 4.7%, and 3.5% of the Mauritian GDP respectively. However, since the beginning of 2010, the diversification of the economy has become a great challenge due to the island’s excessive dependency on these three sectors. A range of investment facets are then proposed as alternatives to this issue. Adorned with investment incentive measures, these facets are offered to investors, contributing to the continuous process of economic diversification and its economic stability.

Revitalization of the Agricultural Sector

Mauritius relied heavily on the primary sector at its independence in 1968. Hence the sector’s contribution to 25% of the GDP, thanks notably to sugar cane cultivation. It covers 90% of the cultivable land in Mauritius and reaches a production of over 250,000 tons per year. This activity was promising, but it was disrupted due to droughts. Therefore, the Mauritian government has focused on organic farming, agro-tourism, and sustainable food production, which can help revitalize this sector and create new sources of income for local farmers.

New Information and Communication Technologies (NTIC)

The Mauritian administration has set up attractive mechanisms for operators in the field. As they showed at ATDA 2023 in the capital of Madagascar last month, Mauritians are more than motivated to become the beacon of the Indian Ocean and the African continent regarding new technologies, notably cryptocurrency. As proof, the recent establishment of the « Financial Services Regulatory Committee focused on Innovation and Financial Technologies » to legally frame entrepreneurship in cryptocurrency.

On the other hand, the island already hosts many service export companies such as call centers and web and application development agencies. In 2021, while other sectors were suffering from the pandemic, exports of IT services reached a value of around 1 billion EUR. Mauritius can attract more investments and become a regional technological hub.

Renewable Energies

Renewable energies constitute a major challenge of our century but also a significant opportunity for Mauritius, which has the required assets. By exploiting its abundant natural resources such as sun and wind, the island can reduce its dependence on fossil fuels and promote a transition towards a cleaner and more sustainable economy. Mauritius has 2400 hours of sunshine per year. It is already integral to renewable energy projects such as Solar and Wind Energy in the Indian Ocean (SWIO), in collaboration with Réunion and Seychelles.

The diversification of the economy does not happen overnight. The Mauritian government is well aware of this. Hence its massive encouragement for foreign investment in these various fields. This encouragement is supported by accompanying measures such as creating various specialized organizations and institutions responsible for promoting economic diversification. Notably, the Board of Investment (BOI), was created in 2001 to attract foreign investments and promote emerging sectors. Similarly, Enterprise Mauritius is a government agency that helps to promote Mauritian exports and develop new markets. Also, tax relief measures are offered to investors in real estate, automotive, industry, and many others.

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