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Mauritius’ Finance Ministry holds Financial Services Consultative Council meeting

Mauritius’ Finance Ministry holds Financial Services Consultative Council meeting

Financial Secretary Dev Manraj chaired the meeting of the FSCC, which serves as a think-tank for suggestions and ideas for the development of financial services and global business sectors. (Image: MBC)

Mauritius’ Finance Ministry held the Financial Services Consultative Council (FSCC) on Monday June 30, 2014, in Port Louis, chaired by Financial Secretary Dev Manraj.

Discussions centered on a number of initiatives, including the implementation of Percy Mistry’s roadmap for the financial services industry; a global communication and messaging strategy for the Mauritius financial centre; and product development.

Stakeholders present at the meeting were the Bank of Mauritius, the Financial Services Commission, the Board of Investment, the Mauritius Revenue Authority, the Stock Exchange of Mauritius, the Insurers’ Association, the Mauritius Bankers’ Association, Global Finance Mauritius and the Association of Trusts and Management Companies.

The Finance Ministry has also proposed to hold a series of consultative meetings, along the lines of the FSCC meeting, with stakeholders of different economic sectors such as agriculture, tourism, manufacturing and services, among others.

The objective of these meetings is to reach a consensus on major policy orientation for Budget 2015.

As provided under the Financial Services Act, the FSCC acts as a think-tank and a platform for discussing the latest concepts and international trends, and formulating suggestions and ideas for the development of financial services and global business sectors.

The meeting follows the announcement made by Prime Minister Navin Ramgoolam at the annual dinner of the Mauritius Chamber of Commerce and Industry on Friday June 27, 2014, that Mauritius needs to bring reforms and consolidate various sectors of the economy, including financial services, and to move to a new threshold of development.

At the same meeting, the Prime Minister also announced another important economic development: an agreement with the Chinese realty firms behind the Jin Fei industrial zone to open its doors to Mauritian companies, particularly Small and Medium Enterprises (SMEs).

The announcement, however, did not meet with unanimous approval.

While the MCCI saw opportunities, in particular for exporters, SME representative were left wondering about the conditions which will be associated with the Jin Fei economic area throwing open its doors to them.

It may be noted that in 2006, Mauritius State assigned land to Chinese developers at Riche-Terre in the industrial zone, known today as Jin Fei. The developers sublet lands to Chinese entities for activities in the sectors of logistics, distribution, civil engineering and decoration.

So far, two warehouses for the processing of products for re-export are operational at the industrial zone. By end-2014, Jin Fei is also expected to accommodate a residential complex and offices. Furthermore, a Chinese group Cin-Jin is also envisaging investment in a real estate development project to be set up on around 71 hectares of land in the industrial zone.

However, this is nowhere close to the estimated potential of the project. As of August 2010, Consultancy Africa Intelligence noted that Jin Fei represented the biggest investment by a foreign entity to date, estimating that the project would see an inflow of US$ 750 million, be home to 40 Chinese businesses and generate US $220 million of export earnings annually.

Meanwhile, the International Centre for Trade and Sustainable Development noted in May 2011 that discussions over the 362-hectare, USD 1 billion project were see-sawing, with the government conceding that, of 34,000 direct jobs, only 10-15% would accrue to Mauritians.

Besides it noted that the government’s attempt to promote light engineering, precision works and hi-tech industries, such as pharmaceuticals, on an industrial scale, have not proved fruitful.

“The Jin Fei zone project purported to foster these very industries, alongside services such as education and tourism. However, it has now become clear that the zone will be services-based,” the report concluded.

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