Nasseem Ackbarally speaks with Maurice Lam, the chairman of the Board of Investment in Mauritius (BOI).
African Business: What is the recent level of FDI flows into Mauritius?
Maurice Lam: I must admit that the amount of FDI that reached Mauritius this year is below the level of last year. This is partly explained by the uncertainty about the global economy. Companies are rethinking their investment strategy. We hope that as the environment improves, this figure will also improve. We are looking forward to seeing some significant investment next year.
Unfortunately, the BOI does not have the power to step up things. We find a lot of investment projects are being delayed because of administrative procedures and approvals. We hope to be able to overcome this very quickly. This would open the floodgates for a lot of investment in the future.
Q: Mauritius has diversified its economy from sugar to other sectors over the past 15 years. How did this come about?
A: We are very lucky in Mauritius, where we have a vibrant private sector that has got a lively entrepreneurial spirit. With some insightful policies from the government, Mauritius has been able to diversify from a mono-crop economy to manufacturing, services, tourism and now the ICT.
Foreigners, as well, have brought in their experience and knowledge. We hope this will continue so that the economy can move from labour-intensive activities to higher value-added activities that will help the population get better wages and a better living.
Q: One of the big investment areas is the Integrated Resort Scheme (IRS). How does it contribute to the economy?
A: Is IRS [allowing foreigners to buy property in Mauritius and benefit from permanent residence] a good or a bad thing for Mauritius? Its concept is a blend of the quest for people willing to buy property outside their home countries with the unique attractiveness of Mauritius as a tourist destination. Yes, it benefits the island but I would not consider it as a tourist product but more of an investment by foreigners in the property market here.
Q: What are the new emerging sectors that can bring investments to Mauritius and how is the BOI reaching out to them?
A: The role of the government is not to pick winners in this globalised world. We should let the spirit of enterprise decide. We look at the global industry trends. Then we look at what Mauritius has to offer. To be able to have new sectors developing here, we should be competitive and have the best practices in the world. Mauritius has to be as competitive as Singapore. So, we have a long way to go.
Q: Medical tourism, renewable energy, free-port activities are emerging global sectors. How well is Mauritius doing in them?
A: The island has a unique advantage not only these sectors but also in pharmaceuticals, miniaturisation of communication platforms and education: people like to come here. But I am afraid we are not encouraging people with ideas to develop and design new products and have them manufactured in China for the export market. We are also looking seriously at the construction industry where there are lots of opportunities.
At the BOI, our mandate is primarily to attract FDI, but also to assist in the economic development of the island. We need also to look at the ocean surrounding us where we are doing nothing. We can diversify our tourism product and build hotels offshore. How come we have only one marine farm here? It does not make sense. How come no Mauritian is involved in deep-sea fishing?
Q: China and India are investing massively in Africa. What can Mauritius do to bring in more investment from these countries?
A: I’d say we are very lucky to have ancestral and cultural ties with both China and India. There is no country in Africa that has the type of population we have. Our business people should be proactive and engage with Chinese and Indian business communities. They can act as middlemen and take them to Africa.
But, to be able to do that, they must know the continent. How many Mauritians have been to Africa? Not many. It is equally important to encourage Africans to come to Mauritius for their studies. They can be our ambassadors back home.
Q: “It is easy to do business in Mauritius” goes the slogan. How far is this true?
A: We are first in Africa on the ranking platform and around 30th in the world. This is not enough because the reality on the ground is different. There are many administrative hurdles that we are trying to remove in order to facilitate the life of the business community. We need to improve on that.
Q: Foreign investors say they come because of the political stability. But Mauritians are involved in politics all year round. Does this scare you regarding FDI?
A: This is the beauty of Mauritius. In spite of what you say, business is being carried out here and investors are coming. I must add that politics is our national sport. If it keeps our people busy, happy and makes their mind work and keeps us out of trouble, why not? We should not scare foreigners with the media’s headlines. We have a good political climate here compared to many other countries. There is no political risk in Mauritius because the governments come and go, we still have the rule of law here. We still respect private property and the individual. This is a great place.