How Mauritius became the richest country in Africa
The island nation of Mauritius has set itself apart as the wealthiest country on the African continent on a per capita basis.
Over the past 10 years (2007 to 2017) total wealth held in Mauritius has risen by 195% (in US$ terms), making it the fastest growing wealth market in Africa and one of the top 3 fastest growing worldwide over this period.
Total wealth held in Mauritius now amounts to US$43 billion, while per capita wealth (average wealth per person) stands at US$33,000, making Mauritius the wealthiest country in Africa (on an average wealth per person basis).
A new report by AfrAsia Bank and New World Wealth has put Mauritius in focus, looking at why the country has drawn such immense wealth to its shores.
The sharp rise in Mauritius’ wealth has been primary due to the country’s fundamentals – having a strong economic growth and a stable government – and also in its ability to draw wealthy individuals to do business and live there.
The country has built up a solid financial sector, specializing in offshore banking, fund management and private banking. When combined with an appealing tax regime, secure ownership rights, and a relatively low barrier to gaining permanent residency, it’s no surprise over 4,600 high net worth individuals (people with a net worth over US$1 million) have made it ‘home’.
According to New World Wealth, these are the key draw factors for Mauritius:
- Strong economic growth;
- A thriving and growing financial services sector;
- Well-developed banking system and stock exchange;
- Strong FDI inflows;
- Secure ownership rights – the most critical component of successful wealth creation globally;
- Low taxes – company and personal income tax rates are only 15%, with no inheritance or capital gains tax;
- Residents are free to invest overseas with no exchange controls;
- Low level of government regulation in the local business sector ;
- Automatic permanent residency if one buys a US$500,000+ home in the country;
- Ease of doing business in the country;
- Low jobless rate and low inflation rate;
- Developed, free media;
- Safety – deemed the safest country in Africa;
- Good schools;
- Rising commercial and residential property prices; and
- Access to first class food and produce.
According to New World Wealth, Mauritius’ policies are very similar to other thriving business destinations like Singapore – while its government intervention and ownership rights stand in contrast to places like South Africa and Zimbabwe.
It’s location also makes it an attractive destination to feed further into Africa.
A 2017 study found that Mauritius was ranked as the most attractive destination in Africa for businesses and investors – a position that South Africa once held above it. While Mauritius has done everything it could to make itself more appealing – South Africa has done the opposite, the report found.