Mauritius ‘easiest place in Africa to do business’
The Mauritian government expects foreign direct investment (FDI) to increase by as much as 46% this year and their target is to become a high-income country by 2025, which is defined as an economy with a gross national income per capita above $12,735, by 2025. The island is preparing for it with infrastructure upgrades evident across the board, an efficient public transport system in place and a recently refurbished international airport geared to manage the ever-increasing volume of air traffic.
Timo Geldenhuys, director of Sotheby’s International Realty in Mauritius, says: “Real estate currently attracts by far the largest share of FDI in Mauritius, accounting for 80% of the foreign investment received in the first quarter of this year.
“Statistics from the Mauritian Board of Investment show that that 30% of foreigners who have thus far bought property in the Integrated Resort Schemes (IRS) on the island are from South Africa, 37% are from France and 20% from the UK.”
Long and short-term financial gains
Lew Geffen, chairman of Lew Geffen Sotheby’s International Realty in South Africa says that South African investors are becoming savvy to the long and short-term financial gains of investing in Mauritius.
“Not only is it one of the few remaining countries in the world where the rand still has value, a significant advantage to buying in property in Mauritius,” says Geffen “is that it allows South Africans to use their rands to invest in a dollar-based property market.
He adds that as Mauritius is a member of SADC, South Africans can take advantage of the SADC property allowance which allows individuals to invest in excess of the R4m limit in property without impacting on the designation or extent of their offshore allowance.
The IRS and Residential Estate Scheme (RES) were first introduced to facilitate the acquisition of resort and residential property by non-citizens on the island. International buyers can become Mauritian residents once they acquire a luxury property with a minimum investment of $500,000.
Last year, the two schemes were merged into the new Property Development Scheme (PDS) to streamline the process of foreign property ownership. The PDS does not differentiate between small and big landowners and harmonises the registration duty to a single rate of 5% instead of $70,000 (just over R1m) on registration of a deed under IRS and US$25,000 (about R360,000) under RES.
Relaxed and secure lifestyle
Jacques Nell, real estate projects consultant for Sotheby’s International Realty in Mauritius says: “Lifestyle is an increasingly important factor when deciding where to buy property these days as more and more people are seeking a better quality of life; a more relaxed and secure lifestyle away from the city where they can enjoy quality time with their families.
“And those who cannot yet make a complete break are buying second homes which are not only used for two weeks in December, but as a haven to which they escape as often as possible.”
Nell believes that Mauritius ticks all the boxes, enabling investors to buy their own corner of paradise, especially in the new developments which offer residents an authentic island lifestyle in secure upmarket comfort.
It is clear that Mauritius is no longer regarded as only a tourism hot spot but also a destination for foreign investors, and several South African companies have already relocated portions of their businesses to the island to take advantage of the extremely favourable 15% corporate and personal tax rate.
Geldenhuys concludes: “Mauritius offers not only social and political stability, a strong and diversified economy and a sophisticated financial services industry, but also an educated and bilingual workforce and a pool of skilled and qualified professionals.”