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AfricaMoney | August 20, 2017

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The Expert Explains: Mauritius needs better air connectivity to boost business

The Expert Explains: Mauritius needs better air connectivity to boost business

Self-evidently, if you can’t easily get to Mauritius, you won’t be rushing to do business there either. Worse still, at a time when Mauritius faces growing competition as a jurisdiction of substance from existing competitors such as Singapore and Dubai, as well as from newly emerging ones, the last thing the country needs is to see investors putting their money elsewhere, just because airline timetables preclude them from coming to Mauritius.

For those who wish to dig deeper into why the world isn’t rushing to Mauritius, here is the explanation, straight from the desk of our expert guest contributor, Simon Nayyar, a reputed professional consultant in the financial services sector:

 In a fascinating keynote speech, on 22 August, the Prime Minister set out a compelling vision to make Mauritius the “regional platform for trade, investment and services”.

Nothing could be more laudable. But, as my column last week indicated, one of the biggest inhibitors toMauritius becoming that powerhouse of dynamic regional growth and prosperity is the relative difficulty for international business people and investors to get to Mauritius to do business in the first place.

Self-evidently, if you can’t easily get to Mauritius, you won’t be rushing to do business there either. Worse still, at a time when Mauritius faces growing competition as a jurisdiction of substance from existing competitors such as Singapore and Dubai, as well as from newly emerging ones, the last thing the country needs is to see investors putting their money elsewhere, just because airline timetables preclude them from coming to Mauritius.

Durban, Johannesburg and Nairobi benefit from direct air services with Mauritius. Lots of other major regional business destinations – take, for example, Accra, Entebbe, Lagos and Luanda – do not. Investors wanting to come to Mauritius currently face two or even more separate hops, often on different carriers, to reach Mauritius. So the Prime Minister’s interest in creating a new regional airline business, supported by Air Mauritius, is to be welcomed.

Perhaps what Mauritius ought to become is a new, southern hemisphere equivalent of Dubai. That is to say Mauritius should be transforming itself into a major regional hub interlining transfer traffic out of African cities and moving them seamlessly on to intercontinental mainline services to Europe, south Asia, and Asia-Pacific. That certainly would transform the Mauritian economy and its future prospects. But it would also require a sea change in thinking; a fundamental re-working of the country’s transport infrastructure; and a massive investment in fleet, ground handling, marketing, and interlining agreements with international carriers.

It’s high time, too, that Air Mauritius got off the fence and decided whether it intends to join the Sky Team, the world’s second largest airline alliance; certainly Air France has been wooing it to do so. Otherwise, it should plump for OneWorld(comprising truly global carriers like British Airways and American) or Star Alliance instead. The current absence of an agreed way forward is hampering Air Mauritius’s ability to maximise transfer traffic, and to persuade business travellers fixated on their frequent flyer mileage rewards and alliance benefits to choose Air Mauritius over other carriers when – or, indeed, if – they decide to travel to Mauritius.

The twice daily Emirates A380 codeshare services to Dubai look, to many seasoned observers, like they have had the unintended consequence of creaming off Air Mauritius’s most profitable premium business, threatening Air Mauritius’s long term profitability. This, in turn, makes it harder for Air Mauritius to invest in the leading edge hard and soft onboard product that will enable it to compete for premium passengers in its own right.

Emirates’ strangehold on the route down to Mauritius has also had the effect of, in essence, locking out Qatar Airways (a One World carrier) and the other emerging Gulf States giant, Etihad (so far, non-aligned).  Now that’s definitely not good news for Mauritius’s ability to improve its international air connectivity or secure competitive air fares for its citizens.

Finally, I hear that a review of fifth freedom rights – that’s to say the right for international airlines to pick up passengers in Mauritius en route to a final destination – is under way. Any relaxation of the current rules in the interests of growing the airline traffic coming to and passing through Mauritius, could be highly beneficial to economic growth and investment.

Mauritius’s inter-connectedness with the rest of the world is destined to change radically in the next few years. The potential rewards of greater air connectivity could be immense.

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