Mauritius opt for economic dynamism and pragmatism

Mauritius opt for economic dynamism and pragmatism

Unlike our own 2006-2007 budget which promised little and delivered even less, the Mauritian Minister of Finance has obviously taken the bull by the horns and proposed a dynamic and pragmatic 2006-2007 budget. The budget was so impressive that the Mauritian Minister of Finance, Honourable Rama Sithanen, was voted “man of the year” for 2006.

Mauritius has began to feel the economic malaise after the sugar cane and textile industry suffered serious blows on the international market. However, unlike Seychelles where our economic difficulty was allowed to surface and then fester, Minister Sithanen has introduced stern measures which seemingly would tackle the problems head on instead of shirking away from them.

Minister Sithanen is the former Financial maverick at Air Seychelles and may have had first hand experience of exactly “how not to do it” by using Seychelles as a model of economic failure. The centre piece of the budget is the clear aims to grow local business by cutting back on cumbersome bureaucracy.

The business community has expressed confidence in Minister Sithanen’s budget and feel that they could look to the future with optimism.

We publish below the key points of the Mauritian budget and hopefully our very own Minister, Danny Faure, will learn a thing or two from this model:-

These are the objectives, listed by the Mauritian Minister:

. Move Mauritius away from the outdated ‘preference system’ to a market that favours competitiveness.

. Promote reform and change in the quest for a new business paradigm.

. Open Mauritius up to the outside world by allowing a freer flow of capital, skills and residents.

Commentators have argued that in future it will be easier to start a business on the island and conduct business in general. Investors will look at Mauritius with renewed interest - an essential condition for growth. The heavy administrative process that bogs down initiative will be less of a hindrance.

Procedures such as the tax system and authorisation will benefit from the new mindset, doing away with prior approval in many cases.

Current procedures tend to slow down the development of new business. Streamlining procedures will facilitate new investments, allowing businesses to start up in as little as three days.

. Prior health, safety, fire and police clearance will not be required any more. By following well-defined guidelines, self-adherence will suffice. You can police yourself, simple as that.

. Trade licences will be changed to municipal fees, payable only after the start of operations.

. Development and building permits will merge into one permit, pertaining to one of three sectors - services, commerce or industry.

. The Export Processing Zone (EPZ) and non EPZ sectors will merge and all incentive certificate schemes will be abolished.

. Pre-designed development areas will be set up to facilitate plug-in-operations and prevent search delays.

. Registering any new business will be through the Registration of Companies only.

. The Board of Investment (BOI) will act as a facilitator and promoter, instead of issuing investment approvals.

The Seychelles Investment Bureau should borrow a leaf from the Mauritian Board of Investment’s book as there are mounting criticisms about the delay in approving projects at the S.I.B.

Investors have expressed frustration and annoyance at our own “one stop shop” for business, investment, and enterprise for their inability to cut down the red tapes and rid themselves of unnecessary bureaucracy.