Mauritius in the league of the Top 20 countries in the world for Ease of Doing Business
The World Bank ranked Mauritius 20th out of 190 countries in its flagship Doing Business Report 2019, published on 31st October 2018 and the country maintained its leading position in Africa (48 countries ranked). The country’s Distance to Frontier (DTF) score improved from 77.54 last year to 79.58, implying that the country has improved its business regulatory environment and is closing the gap with respect to the best economies.
Mauritius also finds itself in the top 3 countries among 51 upper middle-income economies. The country distinguishes itself ahead of countries like Canada (22), Germany (24), France (32), Japan (39) and China (46). The top five countries in Africa include Mauritius (20), Rwanda (29), Morocco (60), Kenya (61) and Tunisia (80).
The World Bank recognized improvements made by Mauritius in 8 out of the 10 indicators namely: Starting a Business, Dealing with Construction Permits, Getting Electricity, Registering Property, Protecting Minority Investors, Paying Taxes, Trading Across Borders and Enforcing Contracts.
Improved efficiency in e-filing system for tax and VAT returns
The country is ranked 6th out of 190 countries for Paying Taxes, which is an all-time best performance in this indicator with a DTF score of 93.5. This improvement results from the introduction of a fast track system for processing of VAT repayment claims within 15 days and the simplification of procedures to submit VAT and corporate returns. Moreover, payment of social security charges is made to the Mauritius Revenue Authority and can be lumped with other tax payment such as PAYE.
Register a company in one day
The World Bank further acknowledged reforms to starting a business, positioning Mauritius at the 21st position as compared to 40th last year. Continuous improvements made by the Government has helped reduce the number procedures and cost associated with starting a business. For example, incorporation of a company can be completed within one day (in fact, within 2 hours) and an e-certificate is issued, free of charge. Moreover, the need to register with any other agency has been removed. Corporate and Business Registration Department (CBRD) is able to share information electronically with other Public-Sector agencies.
Safeguarding investors’ interests
Mauritius made a noticeable leap in the Protecting Minority Investors, from 33rd to 15th position. Provisions of good corporate governance have been made mandatory on public companies for e.g. a CEO can no longer be the chair of the Board of Directors, audit reports should be made public and companies should have a separate audit committee composed only of board members.
Simplified process to obtain electricity connection
Mauritius has made significant improvement in the Getting Electricity Indicator from the 110th position in 2016 to 51st in 2017 and 34th in 2018. Improvements made in the process for application for connection to the electricity network have led to a reduction in the number of procedures.
The World Bank further acknowledged reforms in the time for border compliance at export which has been reduced from 38 hrs to 24 hrs. Communication with the Registrar General Department has been made easier with the introduction of a complaint’s mechanism.
Information technology and communication as a tool
Information technology has transformed doing business in Mauritius. Much of the reforms recognized by the World Bank stem from the investment made to improve information technology and the communication infrastructure in the country.
The InfoHighway, which is a platform for sharing data, has facilitated communication between public sector agencies. The CBRD leverages on technology to share company information with other public-sector agencies. The e-filing system at the MRA is being continuously upgraded to facilitate the submission of returns and process repayment claims more efficiently. The Mauritius e-Registry system provides a complete eco-system for online submission and registration of documents.
Technology is undoubtedly a key enabler for reforming the business environment. Business as usual is not a solution. An increasing use of information technology and communication tools is critical to keep the reform momentum. This is in line with Government’s ambition to introduce the National E-Licensing System.
Pursuing our reforms agenda
Reforming the business environment is a continuous endeavour. The Economic Development Board (EDB) remains committed to pursue the agenda to make doing business easy in Mauritius.
A number of initiatives are being undertaken to that end. The Government has initiated legislative amendments to implement secured transaction reforms in the country. Moreover, following budgetary measures on business facilitation, the Finance (Miscellaneous Provisions) Act 2018 brought amendments to 15 legislations which has an impact on the business climate.
The EDB, in collaboration with the European Union, is implementing the National Electronic Licensing System (NELS) which aims to be the single point of entry for application, payment and determination of business-related licences and permits. The Occupation Permit and Residence Permit are live on the NELS. The Building and Land Use Permit will be the next permit to onboard the platform.
As part of the reforms underway, a Business Process Reengineering exercise is being carried out to streamline processes for the determination of 143 business-related licenses and permits.
As announced in budget 18/19, Government is also working on the implementation of a Regulatory Impact Assessment (RIA) framework. The aim of the RIA is to analyse the social, economic and environmental impacts of business-related rulemaking.
Finally, a Regulatory Review exercise will also be conducted in 2019. The Regulatory Review will scrutinize our current business-related legislations and propose a new set of legislations based on international benchmarks and more aligned with long-term objectives. The above initiatives are expected to be instrumental to achieve a more conducive business environment.
For more information, we invite you to download the Full Doing Business Report 2019 and Economic profile of Mauritius.