An analysis on of FDI in 2016

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An analysis on of FDI in 2016

FDI inflows into Mauritius for 2016 represent a sharp increase of 41% compared to 2015. Figures compiled by the Bank of Mauritius for 2016 totaled MUR 13.648 billion compared to MUR 9.677 billion in 2015. 

While real-estate activities represented the largest share of FDI with inflows of MUR 9.9 billion, mainly due to the comparative advantage proposed by existing schemes, a certain diversification was noted last year in terms of recipient sectors. In 2015, 84% of total FDI went into real-estate projects and activities. However, this percentage dropped to 72.8% in 2016. This represents a significant decrease of 13.2%.

Consequently, both the manufacturing and the construction sector attracted MUR 511 million, while financial and insurance activities attracted MUR 2.1 billion. The healthcare and biotechnology sectors are garnering some interest from investors as well, and it is expected that this trend will be sustained in the short to medium-term. These significantly exceed the figures noted in 2015, following BOI’s strategy to target investment in more productive sectors which are starting to bear their fruits. 

A number of high-profile companies set up their operations in 2016. Convergys, Creditfix and Allianz in ICT, Mara Delta in property development, the Bank of China in the financial services sector with Empak and Optsun in manufacturing, are just some of the global players that have chosen Mauritius for their strategic investments.

Sources of FDI

As in 2015, France retains its place as the top source of investment in Mauritius with MUR 4.5 billion, making it worth 33 % of the overall investment. China and South Africa remain important markets, while investment from UAE culminated to an exceptional surge of over 570% to reach MUR 1 billion.

FDI Outflows

Investments outflows from Mauritius have decreased by 23.6% in 2016, compared with 2015, to reach MUR 1.8 billion. An increase in investment in manufacturing activities was noted, increasing to MUR 812 million compared to MUR 2 million in 2015. Real estate activities, accommodation and the food services sectors remained buoyant.

In terms of market break-down, 70.8 % of outward FDI were channeled into developing economies, particularly in Africa, with MUR 686 million invested in Réunion Island alone. On the other hand, MUR 151 million was invested in France and MUR 44 million in the US. 

Impact of FDI Inflows

Last year’s upward trend in FDI inflows is the result of a focused strategy aimed at targeting more productive sectors such as light manufacturing, biotechnology and life sciences. In addition, the Africa Strategy is improving the visibility of Mauritius as a platform for investment into the continent, attracting major players in the financial services sector. 

Courtesy: BOI