As communicated in a past edition¹ of our newsletters, the Mauritius-China Free Trade Agreement (FTA), signed in October 2019 in Beijing, has entered into force on 1 January 2021. The FTA is expected to breathe new life into the economic relationship between both countries. It will be recalled that negotiations pertaining to the FTA began in 2016 and were concluded in 2019 when it was signed by both countries.

Backed by a solid regulatory and banking framework and endowed with a highly skilled population, Mauritius has positioned itself over the years as an investment platform for Africa. Unbeknownst to many, Mauritius has one of the largest Exclusive Economic Zone (EEZ) in the world, boasting around 2.3 million square kilometers of oceanic area that remains largely unexploited, as at date – this tiny dot on the world map could eventually prove itself to be a treasure trove of opportunities for investors and strategic partners. Moreover, the African Continental Free Trade Area was launched on the 1 January 2021; investing in and through Mauritius will inevitably open doors to the African market, which is home to around 1.3 billion consumers.

It is not sheer coincidence that the Asian powerhouse, which is poised to become the world’s largest economy by 2028, singled out Mauritius as the first African country with which to conclude a FTA.

The economic spinoffs of the FTA are expected to be quite significant for both countries. To delve into the various pillars covered under the FTA, the Economic Development Board in Mauritius (EDB), hosted a 2-day workshop on 1-2 March themed “Shaping future economic perspectives", under the aegis of the Ministry of Finance, Economic Planning and Development in collaboration with the Ministry of Foreign Affairs, Regional Integration, and International Trade and the Embassy of the People’s Republic of China in Mauritius.

Under the FTA, Mauritius will benefit from the following:
• Pertaining to trade in goods, Mauritius benefits from immediate duty free access on the Chinese market on some 7,504 tariff lines. Tariffs on an additional 723 tariff lines will be phased out over a 5 to 7-year period starting on 01 January 2021;
• An additional Tariff Rate Quota for 50,000 tonnes of sugar will be implemented on a progressive basis over a period of 8 years with an initial quantity of 15,000 tonnes;
• Both Mauritius and China have agreed to remove restrictions in more than 100 service sectors. These include financial services, telecommunications, Information and Communications Technology, professional services, construction and health services.

¹ Please click here to access our January 2021 release