When it comes to attracting investment –particularly in residential property – Mauritius often comes to mind.
A vibrant growing economy, low taxation rates of only 15%, a thriving financial services sector, ease of doing business and idyllic environment for permanent residence or leisure use all contribute to an enabling environment for investment, notes Pam Golding Properties.
“No housing or property tax, no inheritance tax on properties purchased and no capital gains tax speaks directly to property investors and home buyers, particularly those looking to relocate for retirement or simply a highly appealing lifestyle in a sought after international location,” said Richard Haller of Pam Golding Properties.
“Coupled with this, for a minimum investment of US$500,000 – assuming you retain your property acquisition – foreigners are entitled to a residency permit and may then apply for a Mauritian passport after five years.
“The low tax rates encourage business formation and naturally appeals to retirees, while the island’s corporate tax rate of 15% has made it attractive to foreign investors. There is also no withholding tax on dividends,” Haller said.
In addition, due to investment in education and healthcare – factors of import to families and retirees relocating there, Mauritius ranks 63rd on the human development index (HDI), just one place behind Malaysia.
It is a well run country, ranking top in the latest Ibrahim Index of African governance, as well as being ranked 28 out of 189 countries on the ease of doing business. It is easily accessible with direct flights to several African countries, including South Africa, the property firm said.
“As a result of all these distinct advantages, Mauritius is drawing an increasing number of global and South African property buyers of high net worth, making luxury property acquisitions from the threshold investment to in excess of US$5 million.”
According to the Africa 2016 Wealth Report released by New World Wealth, Mauritius is home to the wealthiest individuals in Africa, with wealth per capita estimated at $21,700. South Africa follows in second place with per capita wealth of just $10,300.
Also according to New World Wealth, the number of US dollar millionaires living in Mauritius has increased by 300 percent since 2,000 to reach 3,200 in 2015, a number which is expected to rise by another 130% over the next 10 years – reaching 7,400 by 2025 and making it the fastest growing African market for millionaires over this period.
It is estimated that over 4,00 South African dollar millionaires have moved there since the year 2,000.
Having started out as a low-income, agriculture-based agricultural economy, the island developed into an exporter of manufactured goods and ultimately an upper-middle income services-based nation.
Mauritius has ambitious plans to position itself as the gateway to the African continent, Pam Golding said.
According to Pam Golding Properties Research, its multi-ethnic society and strong governance give the island nation an edge in its bid to be the African gateway. With trade and investment between Africa and Asia set to grow robustly, Mauritius’ geographical location means it is well placed for this – the island recently invited Singapore to use Mauritius as their regional headquarters to invest in Africa.
Notably, the hospitality and tourism sectors have become a vital economic pillar for the island over the years and are two of the key drivers in advancing Mauritius towards a high income economy in the near future.
Last year Mauritius attracted one million tourists. Government hopes to capitalise on potential in the European and Asian tourism markets while consolidating its traditional hospitality markets.
The country aims to reinforce partnerships in the region in order to tap into the ecological tourism industry, renewable energy and digital connectivity, Pam Golding said.
It has also been promoting commerce and investment initiatives to show that it is more than just a tourist destination. Mauritius is creating an air corridor between Asia and Africa by way of the island and also sees some 30,000 ship movements along its coast – and is thus pitching to become a logistics hub.
Providing financial services to Africa is another area in which Mauritius believes it has a niche. This sector is thriving, particularly in offshore banking, fund management and private banking.
No wonder then that in line with the rise of wealth on the island, there are several new luxury developments under construction.
The property firms said that half of the buyers of several of its developments over the past 12 months are from South Africa.
It said that it is launching a small villa development in Grand Baie, comprising 26 freestanding simplex and duplex villas of approximately 240sqm, starting at approximately US$740,000.