Why move to Mauritius?
For high-net-worth individuals considering a move to Mauritius for permanent residency, it’s more a question of why not?
Talk to the expats who have already invested the required $500,000 (about R7.5m) in residential property to obtain permanent residency in Mauritius, or have moved their business operations to this paradise island and choose to commute from their South African home base, and you’ll find they have at least one thing in common.
The quest for a better quality of life. It’s a priority for government too – this Indian Ocean island even has a Ministry of Health and Quality of Life.
“Towards the end of last year and again this year, South Africans looking for offshore investment opportunities and a more stable political and economic climate are showing increased interest in Mauritius,” says Richard Haller, director for Pam Golding Properties Mauritius.
Political stability and safety is a huge motivator for South Africans looking for a new home. The New World Wealth Woman Safety Index rates Mauritius as one of the safest countries in Africa (in addition to Namibia and Botswana). This is one of the key drivers of a country’s wealth in the long term.
“The wealthiest countries in Africa (in terms of average wealth per person) are Mauritius, SA, Namibia and Botswana,” says Andrew Amoils, head of research at New World Wealth.
“Total wealth held in Africa is expected to rise by 35% over the next 10 years, reaching $3-trillion by 2028. We expect Mauritius, Ghana, Rwanda, Kenya, Ethiopia and Uganda to be the strongest performing wealth markets in Africa during this period.”
With the International Monetary Fund predicting a GDP healthy growth of 3.9% for Mauritius in 2019, it’s a trend underpinned by strong economic growth and a thriving financial services sector, among others, which exudes a sense of stability, trust and confidence recognised by the international community. Mauritius is currently the fastest-growing wealth market in Africa having escalated 195% in US dollar (USD) terms from 2007 to 2017.
Property value in Mauritius is conservatively expected to grow by 40% in USD terms in the forthcoming decade. “For those with $500,000 to invest in real estate that includes permanent residency status, with the option of mortgaging up to 60% of the property value at low interest rates of approximately 5.5% p.a., it’s an investment that offers a high return both personally and professionally,” says Haller.
Top location for residential property investment
The Knight Frank Wealth Report 2019 includes results from an Attitudes Survey in which they polled 600 private bankers and wealth advisers who together manage more than $3-trillion of wealth for ultra high-net-worth clients. When asked which countries or territories were on their radar in terms of a significant purchase, as well as where their clients were most likely to invest, they listed the UK, Australia, US, Canada – and Mauritius.
“Ownership rights are very strong in Mauritius, which encourages locals and foreigners to invest in property and businesses in the country,” says Amoils. Other incentives include low taxes (company and personal income tax rates are only 15%), no inheritance or capital gains tax and a low level of government regulation in the local business sector. The island has a skilled and bilingual (English/French) workforce and boasts a peaceful, multicultural environment.
Mauritius is an ocean state with one of the largest exclusive economic zones in the world. The island is a member of the African Union, COMESA, SADC and the Indian Ocean Rim, benefiting from no trade barriers. The country also enjoys preferential market access to several export destinations through trade agreements notably with the European Union and the US.
“Leveraging on its geographic strategic location and impressive economic trajectory, Mauritius has successfully positioned itself as a regional hub,” writes the Economic Development Board (EDB) Mauritius.
Over the past 50 years, since independence, Mauritius has transitioned from a sugar-based economy to an innovation-driven and knowledge-based economy, underpinned by key sectors such as agro-industry, aqua-culture and ocean economy, education, financial services, healthcare, hospitality, property development and smart cities, ICT-BPO, life sciences, logistics, manufacturing, media and creative industries. It has a state-of-the-art technological infrastructure.
Mauritius has a well-developed banking system and one of the best stock exchanges in Africa. What’s more, wealthy individuals living in Mauritius can invest overseas without exchange controls, which encourages them to use the country as a business and investment hub.
With an estimated 21.7% of the property investment market and one fifth of the foreign direct investment in Mauritius originating in SA, the EDB Mauritius established an office in Johannesburg to ease the process for South Africans looking at investment opportunities on the island. Staff are available to advise on creating businesses and logistics around relocating to the island.
The World Bank’s Doing Business 2019 report evaluates the performance of 190 economies for ease of doing business, according to strict criteria. Mauritius moved to the top 20 this year and is the only Sub-Saharan African economy in that block.
Other accolades in the African context include holding the number one spot for political stability – the Democracy Index 2017 (The Economist Intelligence Unit); good governance – the Mo Ibrahim Index of African Governance 2018; and economic democracy – the Index of Economic Freedom – Heritage Foundation, and the Economic Freedom of the World – Fraser Institute.
For more information on investing in residential property in Mauritius, contact Pam Golding Properties Mauritius on email@example.com or +230 263 0600.
This article was paid for by Pam Golding International.