Manufacturing - Traditional Industries
An established tradition of quality with unparalleled market access.
The manufacturing industry has played a vital role in the economic development of Mauritius for more than 40 years. It is one of the largest sectors in the Mauritian economy, accounting for 11.8% of GDP in 2017 and employing around 98,700 people with over 700 companies.
The Traditional Manufacturing industry consists of the following sectors:
The manufacturing (traditional) sector of Mauritius has evolved into a technology intensive sector and offers investment opportunities in:
- Textiles and Technical textiles
- Spinning mills
- Fashion designers
- Partnerships with existing textile and apparel companies
- Agro-processing activities
- Food processing
The textile industry is considered as the catalyst of the Mauritian industrial revolution. For the past 4 decades, the textile industry has played a key role by spurring economic growth and attracting FDI from various countries, thus creating new employment opportunities and consolidating the manufacturing base of the economy.
Evolving from a producer of basics in the 70’s to a vertically integrated supplier of high value added, design-led garments, the local textile industry is today geared to face challenges of a liberalized market place by providing flexible solutions adapted to the exact needs and requirements of buyers from all over the world.
The local textile landscape is made up of a diversified base of manufacturers able to cater for the needs of a wide spectrum of buyers with a variety of options such as price points, volumes and runs. Some of our leading entrepreneurial manufacturers have accumulated enough expertise to invest in additional production units in neighbouring countries, transferring knowledge to countries enjoying relatively low labour costs, while providing the right degree of flexibility for our clients.
The efficiency, expertise and agility of the sector have contributed in positioning Mauritius as a textile hub of excellence in Southern & Eastern Africa, making our success story a business model that is currently being benchmarked across Africa. The Mauritian manufacturers have the capability to supply a wide range of textile products at varying price points, with a focus on quality that includes T-shirts, lingerie and loungewear, shirts, sportswear, trousers and denim, children’s wear, pullovers, uniforms and beachwear to name a few.
Since the industrialization of Mauritius, the Agricultural Sector has evolved from a mono-sugar industry into a multi-agro products much oriented towards exportation. Today, the agro sector has emerged into the following five sub-sectors:
This sector has evolved from a mono-crop sector producing white sugar to a diversified cane industry producing special sugars, alcohol, molasses and ethanol. With the dismantling of a guaranteed price and abolishing quota with EU on sugar export, this sector is positioning itself by offering 15 types of special sugars, molasses and alcohol for exports. This sector has also re-engineered itself to produce electricity from bagasse, ensuring sustainability in energy production. Today the export of special sugar has increased to 120,000 tons targeting niche markets in some 45 countries. Presently, the country is producing around 400,000 tons of sugar which is also being exported under the fair-trade label. Special sugars being produced include Demerara, Golden Granulated, Light and Dark Muscovado, amongst others. Special sugars are used in a variety of food products including cereals, dairy products, dry baking mixes, beverages, preserves and jellies, ethnic cuisine, snacks, cookies and baby foods.
Mauritius has a total maritime zone of 2.3 million square kilometres with an Exclusive Economic Zone of 1.96 million square kilometres and a continental shelf of 396,000 square kilometres co-managed with the Republic of Seychelles. The Mauritius seafood hub has facilities for trading, transhipment, storage and warehousing, processing, distribution and re-export of fresh chilled and frozen raw or value-added seafood products.
Fish products includes canned tuna, pre-cooked vacuum-packed tuna loins, frozen tuna loins/steaks, frozen fish fillets, fresh chilled whole fish/fish fillets, smoked fish, salted fish, fish oil and fish meal. The seafood processing sector has generated 6,000 direct employment and 10,000 indirect employment created from its ancillary services.
- Spirits and Beverages
Historically, in 1638 when sugar cane was introduced in Mauritius from Java, the island settlers were producing “arrack” a precursor to rum. With the diversification of the sugar industry, sugar producers have opted for distilling sugar cane to produce alcohol as well as industrial rum from molasses. Distillation of cane juice is also being done to produce agricultural, flavoured and island recipe rums. Other spirits being manufactured includes island wine, beer, vodka and liqueurs.
- Fresh Produce
In view of the diversification of the agricultural sector, local farmers have diversified into production of a variety of fruits and vegetables as well as plant foliage’s. Queen Victoria pineapple and fresh lychee are the main fruits being exported. Other fruits with export potentials include breadfruits, avocadoes and passion fruits.
Besides, fruits and vegetables, cut flowers such as anthuriums, flower bouquets and plants foliage’s and branches are also being exported to EU, Japan, Australia, United Arab Emirates, Hong Kong, United States and Canada.
- Processed Foods
The Mauritius industrial set up also include the agro food processing industry which adds value to a variety of agro products. The major products include animal feed and fish pellets, edible oil, wheat flour, margarine, instant noodles, pasta, black tea, canned vegetables, biscuits and waffles, sugar confectionary and cake decorations, amongst others. The food industry also comprises SMEs who are involved in the manufacturing of a range of products such as spices, pickles and chutneys, fruits paste, jams and marmalade, salted banana chips and frozen pre-cooked snacks that gives an authenticity to the unique Mauritian tastes.
Mauritius offers a number of benefits to international manufacturing companies to set up production units locally. These benefits include:
- Preferential market access through COMESA, SADC, EPA, AGOA, GSP, IOC, Turkey FTA & Pakistan FTA
- No import duties on equipment and raw materials
- No export duties
- VAT on raw materials is payable at customs clearance but reimbursable on exports
- Streamlined procedures for the recruitment of expatriates and foreign labour with an 8-year work permit policy for expatriates in the manufacturing sector
- Sea freight rebate scheme: Refund of 25% of the Basic Freight Cost to a maximum of USD 300 per 20-feet container and USD 600 per 40 –feet container exported to 45 eligible ports in Africa including Madagascar and Reunion.
- Investment Tax Credit for investment in high-tech manufacturing equipment
- Speed to market scheme allowing 40% refund on air freight costs incurred on exports of textiles and apparels, fruits, flowers, vegetables and chilled fish.
- Accelerated depreciation on machinery, equipment and construction of industrial premises dedicated to manufacturing activities
- Acquisition of property for business purposes, by a non-citizen investor, is authorised
- Duty-Free and VAT free on goods and equipment imported into Freeport zones
- Exemption from corporate tax
- No Registration Duty and Land Transfer Tax on any transfer of a building or land earmarked for the construction of a building, to be utilised for setup of qualifying high-tech manufacturing activities
- 3 per cent corporate tax on profits derived from exports of goods
- 8-year income tax-holiday for companies engaged in the manufacturing of pharmaceutical products, medical devices and high-tech products
- Tax Incentives for Research and Development (R&D)
- Accelerated depreciation of 50 percent per annum on capital expenditure incurred on R&D
- Companies can claim a double deduction in respect of qualifying expenditure on R&D until income year 2021-2022