The theme, “Why Mauritius, Sovereign Wealth and Pension Funds: Understanding, Managing and Capitalizing of Risks” was one of the key themes, providing fodder for thought during day 2 of the Pension Funds & Alternative Investment (PIA) in March where speakers threw interesting insights on the jurisdiction’s attractiveness to do business with the participation of experts such as CEO at Standard Chartered Bank Mathieu Mandeng, Shamima Mallam Hassam, Managing Director at Trident Trust, Head of Fund Services and Capital Markets at Ocorian Novan Maharaje and CEO at Mauritius Investment Corporation (MIC) Jitendra Bissessur.
At the outset, Mandeng remarked that the jurisdiction was the only Investment grade International Financial Services (IFC) in Africa that made the cut among the top 100 in the Global Financial Centre Index (GFCI), “The jurisdiction has been able to leverage its competitiveness to help mitigate harsh inefficiency and complexity to do business on the continent. On top of that, Mauritius has been ranked 13th globally to do business in the world and scoring across tax compliance, physical and social infrastructure, good education, and human capital posing as the bedrock of its development.” He also underlined several attributes such as good governance pertaining to responsibility, accountability, and transparency.
On the other hand, Mallam Hassam who is also the newly elected chairperson of Mauritius Finance (MF) emphasised the fact that 30 years of the MIFC is being celebrated where private equity, DIFCs, and large corporates among others have been using the jurisdiction as a center benefiting their business where tax treaties lend a competitive edge over several jurisdictions. “Adapt, innovate and the leveraging of new products aligns with clients’ and investors’ needs in terms of attributes,” she underscored.
The question of ‘Why Mauritius’, Maharaje explained is attributed to the fact that for the past three decades, a shift has been witnessed from tax focussed and geared towards business investment facilitation coupled with the fact that the jurisdiction has played a successful contribution towards Africa clocking 9-10 percent of FDI flows. “It couldn’t have been much better in terms of the contribution made towards Africa. We need to ask why DFIs and Pension Funds trust us. The answer lies in the agile regulatory framework, corporate structures such as LP and GP as well as open and close-ended Collective Investment Scheme (CIS) coupled with the regulatory framework that constitutes strong plus points as well as the tax treaty with 10 Investment Promotion and Protection Agreements (IPPAs) which is currently active on the African front.
On the question about acquisitions, Mallam Hassam underlined that it has been observed since the past 5-6 years that global firms have been acquiring businesses ushering into a change in business and operation models turning the trend as centers for such groups as one speaks about global jurisdictions. She observes: “The right balance between back office and proprietor business in making the shift from tax to substance while at the same there are innumerable challenges pertaining to compliance with more control taking place and that’s where we educate clients on ways to overcome such obstacles.”
The panelists also touched upon various themes such as agreements inked by Mauritius with namely India through CEPCA, Free Trade Agreement (FTA) with China and the African Continental Free Trade Area (AfCFTA) with the African continent as to which Mandeng pinpointed on the ambition shown by PM Shri Narendra Modi to help transform the Indian economy to the tune of USD 10 trillion GDP. He told that India is undergoing a huge transformation and here lies a huge possibility along the Indian-China-Africa corridor to do business. Next in line was the extent to which climate change can be called a defining challenge for the financial services sector and according to Mallam Hassam, the issue has grabbed eyeballs where clients are putting up frameworks and policies built around ESG in terms of proper data and analysis on what investors, as well as investment companies, are reacting to the issue.
