BALACLAVA, Mauritius (Reuters) – Mauritius plans to become a financial platform for private equity providers eying investment opportunities in Africa, the Indian Ocean nation’s finance minister said on Monday.
Ramakrishna Sithanen said Mauritius’ reputation as one of the continent’s most stable and consistently high-performing economies made it an attractive option for investors.
The palm-fringed island’s offshore services sector has boomed in recent years as the country markets itself as a bridge between the Africa, India and Asia.
“Our plan is to carve out a own niche in the multi-billion dollar private equity industry,” Sithanen said at the launch of a private equity conference.
Mauritius’ finance industry expanded by ten percent last year, making it the fastest growing sector of the economy, he said. Offshore services have expanded faster than GDP at an average annual rate of 7.6 percent over the last five years, according to government data.
Far from its key export markets, the island nation of 1.3 million people packs an economic punch well above its weight.
Once founded on sugar but now diversified into textiles, tourism, ITC and offshore banking, the $9 billion economy is seen growing 2.7 percent this year, the central bank says, down from an average of more than 5 percent for the last three years.
Next year will see the economy rebound with GDP growth exceeding 4 percent, the bank says. [ID:nLN566020]
“The China Africa Development Fund is envisaging the possibility of using our global business financial services platform to invest in Africa,” Sithanen gave as an example.
Mauritius also hopes private equity will help fund infrastructure projects worth billions of dollars.
“We will have to finance over $15 billion of public infrastructure projects over the next ten year. Most of these will be frontloaded and financed on a PPP basis,” he said.
“We are hopeful that private equity will account for a significant share of these investment projects,” Sithanen added.
In his six-month budget in May, Sithanen forecast that the budget deficit would hit five percent in 2010, having warned in the past that anything above 5.5 percent would be unsustainable. (Writing by Richard Lough; Editing by Daniel Wallis; Editing by Andy Bruce)