WORLD RANK: REGIONAL RANK: MAURITIUS

21 1 auritius’s economic freedom score is 74.9, making its economy the 21st freest in the 2020 Index. Its overall score has increased by 1.9 ECONOMIC FREEDOM STATUS: M MOSTLY FREE points, primarily because of a higher government integrity score. Mau- ritius is ranked 1st among 47 countries in the Sub-Saharan Africa region, and its overall score is well above the regional and world averages.

The economy of Mauritius has been mostly free for more than a decade. Economic expansion as measured by the average annual rate of GDP growth has been solid for the past five years.

To put economic freedom in Mauritius on a faster trajectory and make the leap to a top-10 ranking, the government must take even stronger action to correct a continuing serious deficit in government integrity, which is eroded by levels of corruption that are more typical of much poorer and less-developed countries. Additional efforts to improve the consistency and efficiency of the judicial system and broaden participa- tion in the formal labor market are also needed.

ECONOMIC FREEDOM SCORE

▲ UP 1.9 POINTS 74.9

0 50 60 70 80 100

REGIONAL AVERAGE WORLD (SUB-SAHARAN AFRICA REGION) 55.1 61.6 AVERAGE

HISTORICAL INDEX SCORE CHANGE (SINCE 1999): +6.4

RECENT FREEDOM TREND QUICK FACTS



POPULATION: UNEMPLOYMENT: 1.3 million 6.9%  GDP (PPP): INFLATION (CPI): 74.7 74.7 75.1 74.9 73.0 $30.0 billion 3.2% 3.8% growth in 2018

5-year compound FDI INFLOW:  $371.5 million annual growth 3.7% $23,699 per capita PUBLIC DEBT: 65.2% of GDP 

      2018 data unless otherwise noted. Data compiled as of September 2019

BACKGROUND: Mauritius gained independence from the United Kingdom in 1968. Sir Anerood Jugnauth, a former president, became prime minister for the third time in 2014 but resigned in 2017 in favor of his son Pravind. A general election was scheduled for December 2019. Mauritius has undergone a remarkable economic transformation from a low-income, agriculturally based economy to a diversified, upper-mid- dle-income country that has attracted considerable foreign investment and has one of the Africa region’s highest per capita GDPs. The government is trying to modernize the sugar and textile industries while promoting diversification into such areas as information technology and financial and business services. Services and tourism remain important economic drivers, and maritime security is a priority.

328 2020 Index of Economic Freedom WORLD AVERAGE | ONE-YEAR SCORE CHANGE IN PARENTHESES 12 ECONOMIC FREEDOMS | MAURITIUS

RULE OF LAW GOVERNMENT SIZE

(+6.3) (+0.5) (+13.0) (–0.6) (+1.8) (+5.7)

 

 

 

 

 

75.8 62.6 53.3 91.5 82.1 79.3   Property Judicial Government Tax Government Fiscal Rights E ectiveness Integrity Burden Spending Health

Property rights are respected, and the recording system The personal income and corporate tax rates are a flat 15 for mortgages and liens is reliable. Contracts are legally percent. Other taxes include a value-added tax. The overall enforceable and binding. The generally independent judiciary, tax burden equals 20.0 percent of total domestic income. headed by the Supreme Court, administers a legal system Government spending has amounted to 24.4 percent of the that combines French and British traditions. The prevalence country’s output (GDP) over the past three years, and budget of corruption in Mauritius is low by regional standards. deficits have averaged 2.8 percent of GDP. Public debt is equivalent to 65.2 percent of GDP.

 REGULATORY EFFICIENCY OPEN MARKETS

(+2.7) (–0.6) (–5.6) (–0.2) (No change) (No change)

 

 

 

 

 

82.5 60.2 73.8 88.2 80.0 70.0   Business Labor Monetary Trade Investment Financial Freedom Freedom Freedom Freedom Freedom Freedom

Mauritius has one of the region’s most efficient and trans- The total value of exports and imports of goods and services parent business environments. The Business Facilitation Act, equals 94.9 percent of GDP. The average applied tariff rate is passed in 2019, eliminated some redundant or unnecessary 0.9 percent, and 12 nontariff measures are in force. The invest- requirements for starting a business and simplified the ment framework is open and efficient, facilitating the flow of payment of taxes. Labor regulations are relatively flexible. new investment. The growing financial sector, dominated by Subsidies to state-owned enterprises, poorly targeted welfare private commercial banks, is competitive. The banking sector benefits, and price controls on petroleum, gas, wheat, rice, is well capitalized and has shown resilience in the face of and bread continue to consume fiscal resources. external shocks.

The Heritage Foundation | heritage.org/Index 329