On October 17, 2019, H.E. Mr. Miao Kwong Lee Hon Chong, Ambassador of the Republic of Mauritius to the People’s Republic of China and H.E Mr. Zhong Shan, Minister of Commerce of the People’s Republic of China signed the Free Trade Agreement (FTA) between the Republic of Mauritius and the People’s Republic of China.
The Agreement comprises 17 Chapters encompassing Trade in Goods, Sanitary and Phyto-sanitary Measures, Technical Barriers to Trade, Competition, Intellectual Property, Electronic Commerce, Trade in Services, Investment, Economic Cooperation, amongst others
The FTA also contains Annexes on Rules of Origin, Market Access for Goods schedule for Mauritius and China and Services Market Access schedule for Mauritius and China.
The Mauritius – China FTA represents a major achievement since it is the first Agreement that China has signed with a country in Africa and it will give Mauritius access to a huge market of some 1.4 billion inhabitants.
Mauritius will benefit from duty free access on the Chinese market on some 8,227 products, representing 96% of the Chinese tariff lines. The duties applicable on 88% of these tariff lines would be eliminated with immediate effect. The remaining tariffs would be eliminated over a 5 to 7-year period. These products include key export items such as rum, frozen fish, noodles and pasta, wafers and biscuits, fresh fruits, juices, mineral water, linen, garments, watches and articles of leather, amongst others.
Mauritius struck an extraordinary deal with the Chinese side on special sugar, which is expected to generate export revenue of some $ 40 million. China agreed to grant Mauritius a Tariff Rate Quota (TRQ) of 50,000 tons market access for special sugar with an in-quota rate of 15%.
As regards trade in Services, Mauritius service providers would have access to more than 40 service sectors, including amongst others financial services, telecommunications, ICT, professional services, construction and health services. Mauritius would also be able to establish businesses in China as wholly owned entities or in joint partnership with Chinese operators.
The FTA will create new investment opportunities in Mauritius targeting the Chinese market. The FTA provides for the protection of investors and their investments against discriminatory and unfair treatment. Moreover, investors will be compensated if expropriation of their investments is inevitable. We also expect to have more investment in the services sector from China in view of the predictability and legal security which the agreement provides to investors.
Regarding the Economic Cooperation chapter of the Agreement, Mauritius and China have agreed to collaborate in 10 areas, including industrial development to increase competitiveness; to develop manufacturing based on innovation and research; to conduct exchange of specialists; to have an exchange of researchers for disseminating know how and for support in technology and innovation and to cooperate in the financial sector.
The Mauritius-China FTA will become operational after it is ratified by both countries.