Article by Dev Erriah – Head of Chambers, Erriah Chambers, Mauritius
Mauritius is set to be formally removed from the European Union List of High Risk Third countries (the “EU List”) very soon following the meeting of the European Commission College of Commissioners on 22 December 2021.
Following the de listing of Mauritius from the Financial Action Task Force (“FATF”) greylist Mauritius is now officially removed from the United Kingdom’s list of high-risk third countries. This removal has strengthened the Mauritian jurisdiction and reinforces its position as the International Financial Centre of choice for the African region.
Mauritius made a high-level commitment to work with the FAFT as well as the Eastern & Southern Africa Anti-Money Laundering Group (ESAAMLG) to strengthen the effectiveness of its AML/CFT regime and, since then, has worked tirelessly with key stakeholders and private sector representatives to address the various deficiencies.
The announcement of the EU Commission follows the exit of Mauritius from the FATF grey list on 21 October 2021 following the on-site review conducted by its review group, which was satisfied at the progress the country has made in reforming its AML/CFT framework.
The challenges posed by the inclusion of Mauritius on the FATF Grey List have not been entirely detrimental and unbeneficial to the country. If anything, they have helped it emerge as a resilient jurisdiction that prioritises transparency and adherence to international best practices and where the public and private sectors work in unison to support the very foundations of the economy.
Mauritius’ role as an International Finance Centre is becoming integral for entities wishing to invest in the continent. Firmly established as the business and cross-border investment hub of choice for Africa, Mauritius has one of the continent’s most dynamic economies.
Between 2015 and 2019, its gross domestic product (GDP) rose by an average 3.8% a year. Foreign direct investment is also on the up, reaching $472 million in 2019 compared to $372 the previous year.
The economy is moving toward innovation- technology- and knowledge-based sectors, including high-tech agribusiness, IT, business process outsourcing and logistics. Export-oriented manufacturing, a traditional strength contributing 12.3% of GDP, is also moving up the value chain with new technologies being adopted by garment, sugar, and many other manufacturers.
As a result of the Country’s trusted and efficient systems, Mauritius has long been one of Africa’s biggest and most respected International Financial Centers (“IFC”).
Mauritius is 45th in the overall Prosperity Index rankings and maintained the top spot in the Sub-Saharan region in the 2021 Index and position itself as the country with the highest level of prosperity in Africa cumulating favourable performance across three pillars- Safety and Security, Governance, and Investment Environment.