Mauritius-China Free Trade Agreement

Overview

Consultations pertaining to the Mauritius-China Free Trade Agreement (FTA) started in 2018. It was signed on the 17th of October 2019 in Beijing China and came into force on the 1st of January this year.

The FTA covers some 8,547 Chinese tariff lines and 6,375 Mauritian tariff lines, namely in goods, trade in goods, trade in services, investment, economic cooperation, dispute settlement, electronic commerce, competition policy, intellectual property rights, technical barriers to trade, sanitary and phytosanitary measures and legal provisions.

The Economic Development Board (EDB) organized a two-day workshop, on the 1st and 2nd of March 2021 on the Mauritius-China FTA, themed Shaping Future Economic Perspectives. The event saw the participation of the Ministry of Finance and Economic Development, the Ministry of Foreign Affairs, Regional Cooperation and International Trade, the Ministry of Industrial Development, SMEs and Cooperatives, the Ministry of Financial Services and Good Governance, the Ministry of Information Technology, Communication & Innovation, the Bank of Mauritius, the Mauritius Revenue Authority, the People’s Republic of China Embassy in Mauritius, the Mauritius Chamber of Commerce & Industry (MCCI), Business Mauritius and various Mauritian and Chinese business operators.

Through a series of presentations and discussions, the Mauritius-China FTA and its many components were comprehensively detailed. Among the objectives of the workshop were to market the FTA among both Mauritian and Chinese business operators, to share business intelligence, personal experiences and market trends, and to help stakeholders develop new business models to tap new opportunities under the FTA.

How will the FTA benefit both parties

The elimination of Customs Duties-tariff phase down can be broken down to three categories with regards to China:

• Immediate
• 5 years
• 7 years

Whereas for Mauritius, the elimination of Customs Duties-tariff phase down will be application in 5 years. Furthermore, there will a non-imposition of Non-Tariff Barriers on imports of both parties, that is Mauritius and China. The FTA will endeavour to facilitate trade between the two countries by simplifying procedures as well as enhancing transparency. Cooperation will be strengthened and will be based on international standards, guidelines and recommendations. The FTA will also strive to ensure that standards, technical regulations and conformity assessment procedures do not create unnecessary technical barriers to trade.

Chinese offer to Mauritius

Immediate liberalisation : 7,504 lines (i.e 87,7%)

Tariff phase down over 5 years: approximately 449 lines (i.e 5%)

Tariff phase down over 7 years: approximatey 274 lines (i.e 3%)

Excluded: 313 lines (i.e 3.6%): green teas, grains, wheat, rice, oil, tobacco products, paperboards, some woollen and cotton fabrics, machines.

Market Access in China

• Immediate liberalisation - 7,504 lines (i.e 87,7% of Chinese tariff lines)

  Products:

  • Live animals
  • Frozen meat
  • Fresh & Chilled Fish (including but not limited to Bluefin, Skipjack, Bigeye, Skipjack, Yellowfin, Swordfish, Seabass etc.)
  • Dairy products
  • Flowers and vegetables
  • Preserved products (including sea urchins and cucumbers)
  • Cane Molasses
  • Sugar confectionery
  • Wines, spirits (including rhum)
  • Chemicals and their compounds, fertilisers
  • Medication
  • Paints and Varnishes
  • Essential Oils
  • Waxes and Polishes
  • Animal Hides & Articles of leather
  • Articles of textiles and garments
  • Articles of Stones, plaster and cement
  • Optical products and glassware
  • Medical devices
  • Jewellery and some semi-precious stones
  • Iron bars, pipes and wires
• Tariff phase down over 5 years – 432 lines (5% of Chinese tariff lines)

  Products:

  • Frozen Bigeye Tuna
  • Frozen fish + Frozen Yellowfin Tuna
  • Frozen fillets of Tuna, Skipjack or stripe-bellied Bonito
  • Fish Fats, Oils and Fractions
  • Lychees and fresh fruits
  • Coffee
  • Fresh and Chilled meat and offal of fish and other animals
  • Nuts including macademia
  • Prepared and preserved foods
  • Jams and jellies
  • Household articles of plastic
  • Rubber Dyes
  • Textile fabrics
  • Garments
  • Footwear
  • Jewellery, jewellery parts and imitation jewellery
  • Articles made of Aluminium
  • Solar & Gas Water Heaters
  • Electrical Devices
  • Television Sets
  • Engines for Motorcycles
  • Clocks and watches and parts thereof
• Tariff phase down over 7 years – 288 lines (3% of Chinese tariff lines)

  Products:

  • Black tea (FROM EXCLUSION LIST)
  • Watch straps, bands, bracelets and parts thereof
  • Clock or watch dials
  • Photographic or cinematographic goods
  • Garments (overcoats, trousers, dresses, jackets…)
  • Automobiles, Chassis fit with engines
  • Vehicle parts

Sugar Market Access in China

In addition, a Tariff Rate Quota for 50,000 tonnes of Sugar will be implemented on a progressive basis over a period of 8 years with an initial quantity of 15,000 tonnes.

Mauritius Offer to China

• Out of 6,375 tariff lines
  • Minimum Occupation Period (MOP) 5 years
    51 lines – All products 30% & 15% down to 15% & 10% respectively over 5 years Covers tea, rums and spirits, bags, Electrical machinery and equipment, furniture, bedding and mattresses.
  • Exclusion
    Some 134 lines excluded from the FTA
    Products concerned: wheat, flour, white sugar, mineral water, paints and varnishes, soaps, shutters/blinds, boxes/paper articles, curtains and drapes, tube and pipes
  • Sensitive
    190 lines-tariff presently duty free – with possibility to re-introduce duty in exceptional cases
    Dairy products, noodles, pasta, flowers, animal/vegetables fats oils, juice, varnishes, detergents, perfumes, electrical machinery, furniture and beddings For China – maximum of 15% in any case

Trade in Services

• Chinese Offer

  Several sectors are open to Mauritian service providers :

  • Financial services, telecommunications, professional services, construction, education, tourism, health services etc.
  • Mauritius will be able to establish businesses in China as wholly owned entities or in joint partnership with Chinese operators
  • Mauritius will be able to establish businesses in China as wholly owned entities or in joint partnership with Chinese operators
• Mauritian Offer
  • Market access in accounting, auditing and book-keeping services. A Chinese company may set up subsidiaries or branches in Mauritius, only in the form of joint ventures, with foreign majority ownership permitted.
  • Architectural services: Joint venture requirements with 49% foreign participation
  • Higher Education Services : The right of establishment of Chinese parties is subject to domestic requirement in the laws and regulations for tertiary educational instructions
  • Translation and interpretation, motion picture, Research & Development and Medical Services.

Investment

The Mauritius-China FTA also caters for a while chapter on investment between the two countries, and has set up a comprehensive framework regarding financial services, the movement of natural persons, and domestic regulations amongst others.

• Chinese Investments in key sectors:
  
  The aims are to attract Chinese investments to diversify our products base and to set up Mauritius as a manufacturing base for exports duty free to Africa under the South Africa Development Community (SADC), Common Market for Eastern and Southern Africa (COMESA) and eventually, the Africa Continental Free Trade Agreement (AfCFTA).
• Investment can be attracted in the following sectors:
  
  • Construction projects
  • Energy (including hydroelectricity)
  • Artificial Intelligence & Robotics
  • Research & Development (to support Innovation)
  • Information Technology/Telecommunicications
  • Real Estate & Entertainment/Leisure
  • Port Development
    
    
• Areas for Mauritians to invest in China
  • Prospects for Mauritians to invest in Free Trade Zones (manufacturing units)
  • Real Estate (enterprises can be wholly Mauritian-owned)
  • Leasing (subsidiaries can be wholly-Mauritian-owned)
  • Computer Services
  • Wholesale Trade
  • Construction projects

Other Opportunities for Mauritians

• Land may be used by enterprises and individuals (conditions apply) for residential, industrial and other purposes
• Joint Ventures investment : minimum 25% of the Joint Venture
• Professional services: medical & dental, legal, accounting services, architectural; engineering, urban planning, travel & tour operators, hotel and restaurants
• Financial services: Non-life insurance, life insurance, banking, local financial institutions willing to establish a subsidiary/branch/joint venture in China

Panel Discussions during the 'Mauritius-China FTA' two-day workshop

The Secretary-General of the MCCI, Dr Yousouf Ismaël chaired two interesting panels over the two days.

The first panel discussion, themed Expanding Businesses and Increasing Exports – Opportunities arising from Preferential Market Access, comprised Mr Devesh Dukhira, CEO of the Mauritius Sugar Syndicate, Miss Grace Qiu, General Manager of Mauristea Investment Co. Ltd, Mr Allan Matthieu, Director of YOAL Shanghai Trade Co. Ltd and Mr Arnaud Luppens, Sales & Marketing Executive Laguna Clothing.

The discussions can be viewed below:

As for Day-2, the panel discussion focused on the Trilateral Axis China-Mauritius-Africa. Moderated by Dr Yousouf Ismaël, it had as panellists Mr Ravin Dajee, Managing Director, ABSA Bank (Mauritius) Ltd, Mr Ian Valentine, Principal Consultant Huawei, Mr Allen Yang, General Manager Jin Fei, Mr Mahen Rawoteea, Director, Ministry of Finance, Economic Planning and Development, Mr Li Hai, Chairman Yi Hai Smart City.

Watch the interactions below:

Complementary information about the Mauritius-China FTA is available here

Acknowledgements:

The Economic Development Board, the Ministry of Foreign Affairs, Regional Cooperation and International Trade, panellists and speakers present at the Mauritius-China FTA workshop.