Economic and trade bonds between Mauritius and China set to take off thanks to their bilateral FTA

Mauritius has played a significant role in the development of civilizations by linking China, the Indian subcontinent, Iran, Europe, the Horn of Africa and Arabia, facilitating long-distance political and economic relations between the civilizations for nearly two centuries. As a result, Mauritius is hailed as the "Star and Key of the Indian Ocean".

Mauritius is home to one of Africa's four oldest and largest Chinese communities, and Chinese migration can be traced back to the 1800s. The Chinese community settled mostly in the heart of the capital, Port Louis, and flourished especially in the trade and commercial sector. Following its independence in 1968, Mauritius still displays an everlasting cultural bond with the Chinese community, being the only country in Africa where Chinese New Year is designated as a national public holiday.

With great vision, the older generation of leaders in both Mauritius and China gave a historic handshake across the vast ocean. Both sides hoped to see the two countries grow in parallel and conduct cooperation based on shared interests. This important spirit was embodied in the establishment of diplomatic and economic ties between Mauritius and China on April 15,1972.

History tells us that by following the trend of the times, the right strategic choices are made. The economic and commercial ties between Mauritius and China have witnessed great vigor and dynamism over the past few years.

The Mauritius-China Free Trade Agreement ratified on Jan 1, 2021, seeks to consolidate bilateral economic and commercial successes chalked up in the wake of the African Continental Free Trade Agreement, which has created a single market of about 1.2 billion people with a combined market worth of about $3 trillion. Additionally, in terms of population, the top 10 countries with the youngest population in the world are all in Africa.

Mauritius aims to transform the island into an open and globally competitive African economy and fully integrate into the African Union and into the world trading system through its trade policy. Mauritius has signed a wide range of multilateral, regional and bilateral trade agreements, such as the African Continental Free Trade Area and others, providing Chinese enterprises with access to preferential markets, exempting or reducing import tariffs, and strengthening the supervision of intellectual property rights.

In terms of trade in goods, after the MCFTA took effect, Mauritius will gradually benefit from the immediate duty-free access of about 7,504 tax items in the Chinese market within eight years. In addition, the tariff quota of 50,000 tons of sugar will be gradually implemented within eight years, with an initial quantity of 15,000 tons. The free trade agreement consists of four main components: trade in goods, trade in services, investment and economic cooperation for mutual benefit.

According to the trade data of Mauritius Bureau of Statistics, the total of gross import and export volume in 2021 was about 297.29 billion rupees (about $6.91 billion), a year-on-year increase of 26 percent. Among them, the total export volume was 82.1 billion rupees, an increase of 16.9 percent, the import volume was about 215.18 billion rupees, an increase of 29.8 percent, and the trade deficit was about 133.08 billion rupees, an increase of 39.4 percent. Last year, China became the largest trading partner and the largest source of imports of Mauritius, and two-way investment between Mauritius and China has become increasingly active.

Beijing became the top trading partner of Port-Louis in the first quarter of 2022. This symbolic trade achievement between the two capitals during the golden jubilee of Mauritius and China relations is a result of the quota set in the MCFTA with regards to Mauritius Special Sugar.

Further to the above, the enlisting of Mauritius into the Partnership for Enhancing Export Capacity of Africa to China, a three-year project that aims to promote trade and investment cooperation between China and Africa through Hunan province, is expected to leverage Mauritius as the ideal investment hub for China and the other selected African countries (Ethiopia, Kenya, Madagascar, Mozambique, Rwanda, Uganda and Zambia).

We expect a number of Chinese enterprises to conduct market research for the establishment of their offices in Mauritius shortly after flights resume.

From the investment promotion perspective, we have been organizing numerous workshops and conferences with partners in China and look forward to organizing similar workshops with the China Association for Enterprises with Foreign Investment located in Beijing, Shanghai, Zhejiang province, Guangdong province, Hunan province and Shandong province.

State Councilor and Foreign Minister Wang Yi recently mentioned that "China is a long-term and reliable partner of island nations". On behalf of the island nation of Mauritius, I am certain that the already strong existing friendship and economic bonds between Mauritius and China will grow significantly in the next five years aligned with the MCFTA and rise to a pedestal level during the next forthcoming 50 years.

The author is economic and commercial counselor at the Embassy of the Republic of Mauritius in China and chief representative of Economic Development Board of Mauritius Representative Office in China. The author contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.

Contact the editor at editor@chinawatch.cn