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OECD Investment Policy Reviews: Mauritius 2014

image of OECD Investment Policy Reviews: Mauritius 2014

This review illustrates the significant progress made by the government of Mauritius in improving its investment climate in recent years. It highlights major initiatives and specific policy measures undertaken, as well as areas that need further reforms to attract more and better investment, both domestic and foreign. While numerous policy advances have been achieved, this review identifies remaining challenges and policy options.

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Strenghtening supply-side capacity for attracting investment to Mauritius

Systemic constraints to investment and export competitiveness in Mauritius include small market size, geographical isolation, and high labour costs. More fundamentally, the skill base is not tailored to the requirements of sectors promoted by government: a mismatch in labour market skills constrains competitiveness and prevents the population from making the most of business linkage opportunities. Mauritius has yet to take the step towards a coherent global economic strategy, which would put foreign trade in perspective with enabling human resources, infrastructure and investment strategies. Ensuring greater policy coherence between trade and investment strategies – including at industry and sector-specific level – would be essential. In addition to diversifying export partners, trade policy will need to balance exports with growth of the domestic market, reduce the gap between trade policy formulation and implementation, and upgrade the links of Mauritian industry with international value chains – notably through targeted human resource mobilisation.

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