Investing in Mauritius: Is the Grass Really Greener?

Mauritius has long been known as a top destination for tourism, with its stunning beaches, crystal-clear waters, and lush vegetation. In recent years, the island nation has also emerged as a top destination for foreign investment, both in terms of property and business opportunities. However, the island’s small size in relation to other high-performing markets has investors wondering if the grass really is greener on the beautiful landscape of Mauritius? Well, in this case, it is safe to say that dynamite comes in small packages. With Mauritius boxing up an array of impressive global recognition rankings in the year prior, it is easy to see why investors’ eyes have landed on its white, sandy shores. Among its many notable recognitions in 2022, Mauritius has ranked: • 1st in sub-Saharan Africa in the Global Peace Index; • 1st in Africa in the Global Innovation Index; • 1st in sub–Saharan Africa in the Economic Freedom of the World Report (“EFW”); • 9th globally in the EFW for the year 2022 (upwards from 11th in 2021); and • 1st in the Indian Ocean as a Sustainable Tourism Destination (a new addition to its leadership in Adventure Tourism and Wedding Destination rankings in the region). Backing its notable achievements, the country has shown resilient economic performance since the arduous aftereffects of the Covid-19 pandemic. Real GDP growth was recorded at 7.2% year-on-year as at September 2022, and has been forecasted upwards to 7.8% YOY for the close of 2022 according to Statistics Mauritius (upwards from 3.7% in 2021). With a favourable tax system, secure living environment, and a long standing political and economic stability, Mauritius offers a highly desirable backdrop to those wishing to relocate to or invest in a fast-growing market. Investors have been further drawn by the island’s cultural harmony, high social inclusivity, and elevated quality of life. Top-notch local education and medical services also appeal to those relocating with a family or seeking to retire in a splendid and peaceful setting. 

 Let’s unpack some of this in more detail:

Economic Vigour Furthermore, the island nation has a robust and diversified economy, with a thriving financial services sector, a strong tourism industry, and an emerging technology sector. As has been highlighted by the aforementioned global and regional rankings, the government has been proactive in creating an environment that is conducive to business growth and innovation, resulting in a steady stream of foreign direct investment. Tax Efficiency Mauritius has long been recognised as a tax-efficient jurisdiction, offering a range of tax incentives and benefits to both individuals and businesses. Its well-established and transparent tax system has earned it a reputation as a global business hub. The country's tax regime includes a flat rate of 15% for individuals and businesses, with exemptions for certain types of income, as well as a network of double taxation agreements with more than 40 countries. In addition, the island offers a range of tax incentives for investors, including tax holidays for qualifying companies, and possible exemptions from withholding tax on dividends, interest, and royalties. These measures make Mauritius a highly attractive destination for foreign investors seeking to maximise their returns and minimise their tax liabilities. Thriving Real Estate Market Another key draw for foreign investors in Mauritius is the wide and high-quality real estate offer. Property investment is seen as a smart choice due to the country’s policy of granting permanent residence permits to those who acquire property on the island. In addition, the government of Mauritius has introduced a ten-year guarantee for property owners on new developments, which provides an added layer of security for investors. This is taken a step further with the absence of capital gains tax and inheritance tax. 

Low Language Barriers Mauritius boasts a bilingual population, with English and French as the official languages. This has greatly reduced any potential language barriers for foreigners looking to do business or invest in the country. The high level of linguistic inclusivity also extends to the government, with all official documents being available in both English and French. This ensures that all investors, regardless of their language preference, are able to navigate the legal and administrative processes seamlessly. Enviable Quality of Life In terms of quality of life, Mauritius has much to offer. The island’s commitment to ecological habits has resulted in a pristine natural environment that is a delight to behold. The country’s safety standard and cultural harmony also adds to its relaxed and welcoming atmosphere. Medical services in Mauritius are of a high standard, and the country has several world-class hospitals. The international education system in Mauritius is also highly regarded, with several renowned international schools and tertiary institutions. This is an attractive proposition for families looking to relocate, as it provides their children with access to quality education that is on par with the best in the world.    

So, while Mauritius may be a small island nation, it packs a big punch when it comes to offering foreign investors a favourable environment to do business and invest. Its impressive global recognition rankings, economic stability, and commitment to sustainable development make it a top choice for those seeking a secure, high-quality lifestyle and a futureproofed investment. If you are interested in real estate investment in Mauritius and/or exploring the various tax saving strategies on offer, get in touch with the Blue Diamond Capital team here. We look forward to chatting with you!      Published by: Levana Naidoo, Property Investment Director February 21, 2023