The reasons to invest in Mauritius
Reasons to invest in Mauritius is not only Mauritius is a beautiful country which sits on the crossroad of Africa and Asia continent. It is more of an African island, and apart from being a perfect destination for tourists. Mauritius also has a robust economic environment for business-oriented people and has great opportunities to invest in Mauritius.
By the way, Mauritius is recognized among the most advanced investment environments in Africa. This could be credited to the country’s democracy, a reputable banking industry, and a stable economy. Here my blog post on, Mauritius Banks the How to List 2021.
Mauritius’ GDP (opens in a new tab) per capita is above $15,000, making it among Africa’s top wealthiest countries. People in Mauritius are quite friendly and welcoming — always ready to share their diverse cultures with their visitors.
The country’s crime rate is also relatively low, making investors, both citizens and foreigners, feel safe in their doings. Investments funds in Mauritius have also become a popular option for both local and foreign investors. The tourism sector is one of the main revenue-generating drives in Mauritius.
However, due to its favorable business regulations and tax policies. The country is attracting numerous investors worldwide.
It is slowly becoming an offshore financial hub. And while foreign investors must attain the right documents to reside and conduct business in Mauritius, the process is relatively stress-free. For instance, a foreign investor can get a residence permit in Mauritius if they intend to invest in real estate worth $500,000 or more.
Investing in Mauritius comes with numerous advantages, which you will learn later on.
How to invest in Mauritius?
If you are a citizen in Mauritius, you are automatically eligible to invest in the country. Now, the question is, can a foreigner acquire citizenship and invest in Mauritius? The answer is yes — here is how to include other options that allow you to invest legally in the country.
Obtain a Citizenship Through Foreign Investment
This scheme awards foreigners with Mauritian citizenship if they make a non-refundable contribution worth USD 1 million or more towards the Mauritius Sovereign Fund. The said investors can include their family; that is the spouse and children.
However, for every person or passport added to the scheme, a non-refundable contribution of USD 100,000 needs to be made.
A Passport Through Foreign Investment
It provides foreigners with a Mauritian Passport once they make a non-refundable contribution worth USD 500,000 towards the Mauritius Sovereign Fund. Likewise, the investor can add his family as long as he adds USD 50,000 for every person included. All these amounts are non-refundable.
If such an investor wishes to be naturalized as a Mauritian citizen through this scheme, they must reside in the country continuously for at least two years. After this, they can make an application for citizenship.
Once a person acquires Mauritian citizenship, they can have visa-free access to more than 140 countries, including China, Russia, the EU Schengen area, and the UK.
This is an added advantage, apart from investing in Mauritius with little to no hitches.
For a foreigner who considers investing in Mauritius, you can also go for an occupation permit. It will be granted to you if your intended business can generate at least MUR 4,000,000 in turnover every year. The initial amount you need to invest is equivalent to USD 100,000 for each investor.
If the business has more than one investor, the turnover requirement is individual. This means that for two investors, a turnover of MUR 8,000,000 is expected, and for three investors, MUR 12,000,000 is expected as well and so forth.
Once you acquire either of the said permits and documents, you are free to invest in Mauritius based on your passion and interests. Most foreigners prefer investing in real estate, which is easy, cheap, and also straightforward. However, some even go for stock markets and investment funds. Keep reading to understand these investment options.
Best Investment Plans in Mauritius
Any person who intends to invest in Mauritius’s real estate is allowed as long as they follow the government’s systems and policies, whether a foreigner or a Mauritian citizen.
That said, here are five real estate investment models that you can consider in Mauritius.
Property Development Scheme (PDS)
This scheme was previously referred to as RES before it was changed to PDS in 2015. Both Mauritian citizens living in the country or abroad and foreign nationals can invest in real estate through this scheme.
They are allowed to buy and own property that is worth USD 500 000 or more.
Once a foreigner commits to this scheme, they have access to a residence permit, which means that the investor and his family can reside in the country.
However, they have to remain as the owners of the real estate acquired.
Integrated Resort Scheme (IRS)
The scheme was set up in 2001 by the Mauritian government, together with the Board of Investment.
It allows foreigners to invest in luxury residences or villas that come with amenities such as swimming pools, spas, golf, restaurants, gym, and tennis, among other high-end facilities. The minimum area for such a real estate property is 10 hectares.
A foreigner can invest USD 500,000 or more to acquire such property, and once it is done, they are automatically eligible for a permanent residence permit.
Real Estate Scheme (RES)
It is another option for foreigners who wish to invest in villas or other properties in Mauritius. Both foreigners and locals are open to this real estate scheme.
The main differences between RES and IRS are in the area occupied and the benefits that come with it. Under RES, a project can be built in an area measuring 4221 square meters, but it has less than 10 hectares. Regrettably, foreigners cannot get an automatic residency like it is in the case of the IRS.
The property does not have to cost a minimum of USD 500,000, but the RES property might grant the foreigner a residence permit in Mauritius if it exceeds this amount.
An investor acquiring real estate under this scheme must provide USD 25,000 for tax and registration fees to the Mauritian government.
Finally, project construction requires approval from the Board of Investment.
Investment Hotel Scheme
This is a real estate model for foreigners only (foreign investment), and it was introduced in Mauritius in the year 2010.
The investor can buy an apartment, a villa, or a room as part of Mauritius’s luxury resort.
There is no minimum limit on the amount invested unless they intend to buy an independent luxury villa, which requires more than USD 500,000.
Under this scheme, a foreigner does not get to obtain a residence permit in Mauritius.
It is a new investment system introduced in Mauritius in 2016, making it easy for investors to acquire a property.
The real estate property in this category is a condominium apartment with a minimum of two floors. Those who buying property in Mauritius can get a temporary resident permit that only lasts for six months.
However, the investors are not eligible for a permanent residence permit under this scheme.
Venturing into Stock Market in Mauritius
Apart from venturing into Mauritius’s real estate market, one can also invest in Mauritius’s stock exchange SEM (opens in a new tab).
And for those who may be wondering whether it is safe to invest in the country or not, we have good news for you.
Mauritius is ranked 33 among 192 countries on the list of Investment Safety Rankings.
This proves it to be among the safest country in Sub-Saharan Africa. Almost everyone is eligible to invest as long as they fulfill the minimum amount required and follow other policy stipulations. However, an investor who intends to acquire a controlling stake in a company will require approval.
Now, if a foreigner wants to invest in the Stock Exchange of Mauritius, they need to create an account known as Central Depository & Settlement (CDS) through an authorized agent in the country. You will use this account to keep your shares, and it is usually similar to a brokerage account.
Everything in this venture is in English, which makes it easy for foreign investors to transact.
Investment Funds in Mauritius
Mauritius is one of the top jurisdictions in the creation and administration of funds in Sub-Saharan Africa. The country is renowned for structuring foreign investments in Asia and Africa, attracting investors and fund managers from different parts of the world.
Some of the things contributing to the booming fund market are favorable tax policies and treaties, flexible and quality legislation, political stability, excellent infrastructure, a reliable time zone, and skilled employees’ availability.
Investments funds in Mauritius structure into different structures.
These include a company, a trust, a protected cell company, foundation, limited partnership, or any other approved entity by Mauritius Financial Services Commission (opens in a new tab) (FSC).
The funds can be variable share capital under CIS (Collective Investment Fund) or fixed share capital, names as private equity funds.
Investors interested in investment funds in Mauritius must apply for authorization through a licensed management company in Mauritius.
Types of Investments Funds in Mauritius
- Global CIS
- Professional CIS
- Specialized CIS
- Expert CIS
- Self-managed schemes
Investing in Mauritius Advantages:
Favorable Tax Policies
Mauritius’ government wants to make the country a financial hub for both local and foreign investors. To ensure that this happens, they are encouraging them by offering low tax rates and exemptions. They include no tax on inheritance and dividends, no VAT (opens in a new tab) or customs duties on equipment, tax credits of 80% for Mauritius offshore companies.
Only 15% tax on personal incomes and company profits, and a refundable VAT of 15%.
Comparing these rates with other neighboring countries would prove to you that Mauritius is a tax heaven.
There is no foreign investor who would invest in any country if they feel that their money or wealth is not safe. Mauritius’ government knows this fact. Apart from ensuring paramount asset protection for all investors, they have also embraced a free-trade economy to encourage more people to invest in the country.
In the year 2013, a famous Wall Street Journal ranked Mauritius in 8th place when it comes to economic freedom prevalence. Also, the Board of Investment makes sure that setting a legal business in the country is as easy as possible.
Since the year 1992, Mauritius Free-port became a free-trade for all re-export products. The government has also facilitated opening a new counter in the port area to quicken the delivery of necessary foreign investors’ permits.
All this ensures that Mauritius becomes the logistical and regional zone for storage, distribution, and business conduction, serving south Africa, East Africa, and Indian ocean nations.
Social and Political Stability
Mauritius acquired independence in 1968, and since then, the country has always been politically stable. Since the colonization of Britain, the country’s political structure is substantially borrowed from the British Parliamentary model. They follow the democratic principles, separation of powers, executive and judiciary, and legislature. As noted earlier, Mauritian people are also friendly and welcoming.
The crime rate is very low, making it comfortable to invest in Mauritius without fear.
It is Strategic Location
Mauritius sits on the crossroad of Asia and Africa in the Indian ocean, and this geographical positioning makes it a reliable hub for commerce. It connects Asia, India, and Africa to other parts of the world. Its time zone, which is GMT+4, is also a convenient factor for business people.
Availability of Qualified and Skilled Labor
Mauritius’ literacy rate stands above 80%, and most populations can speak both English and French languages. Also, most young people in the country have an education, making it easy for businesses to acquire the right talents. Apart from studying in Mauritian universities such as the University of Mauritius (opens in a new tab), some will enroll in foreign universities to improve their training.
One of the reasons why most foreign investors consider investing in Mauritius compared to the neighboring countries is its economic stability. The country’s GDP per capita has always been above $15,000, and the government, in collaboration with the Board of Investment, keeps on developing policies and legislation that maintains this standard.
For instance, starting a business within three days and investor protection (opens in a new tab) has greatly encouraged many people to invest in Mauritius.
They have also signed investor-beneficial treaties and agreements to uphold this protection.
These include the Multinational Investment Guarantee Agency, the 1958 New York Convention, and the International Center for the Regulation of Investment Disputes.
No Exchange Control
Strict exchange control is one reason why most potential foreign investors avoid investing in a given region — such control may lead to delay or loss of business deals.
Mauritius has put no such rules in place in an effort to encourage investors. It means that an investor is free to transfer dividends, profits, or capital to any other country without a hitch.
Reasons to invest in Mauritius – final words
Mauritius is not only a beautiful country to spend a week vacation, but it is also a financial hub that encourages investors from all over the world to invest and build their wealth.
Investing in Mauritius comes with numerous and realistic advantages for all types of investments.