The government seemed surprised : foreign direct investment (FDI) has known a 75% declined. Are we failing in our ambition to attract foreign capital and expertise, or are we just being too arrogant? Is it the world financial crisis? You aren't going to throw this one to me again, are you? Euphoria is difficult to manage, we all agree. Since we launched the Business Facilitation Act in 2006, there has been a big response from the international market. We are superstars, the most desired country of the world...wrong guys, we're just an island.
Officially, the authorities are blaming this on the globally dull economic situation. Will someone, someday, stop blaming the world for every mistake we make? We are not Wall Street for God sake (err, some effectively believe that we are, but that's another story). FDI accounted for as much as Rs4.6 bn from January to March 2010. Guess what? We got only Rs1.4 bn for the same period this year. If you are still wondering what calamity broke on world's economy in January 2011, then you are heading to the wrong direction.
The problem is in Mauritius, it’s all in our attitude. The Government has set up a committee to monitor all applications for residency permits (Occupation Permits). The committee members act in complete impunity behind the curtain. Untouchable and incorruptible... Visibly these guys have misunderstood their role. It is obvious that they're having great fun rejecting applications. It wouldn’t be exaggerated if I say that it’s almost an orgasmic pleasure. The more they reject, the more competent they believe they are. It's a pity that they do not understand that each permit rejected directly impacts on FDI. The least we can get from an Occupation Permit is US$35,000 (self-employed). There are about 20 such applications rejected per week, according to information gathered from professional consultants.
I have one observation: it means that foreigners are coming to Mauritius with their money AND they are more than 20 a month!
Pity, we area losing FDI and I’m not talking about job creation and tax revenue that we are rejecting.
One of the biggest sectors designed to attract foreign investment is the luxury living industry, well that's how we call the seemingly luxurious villas we have; the famous IRS and RES schemes. Again, we thought we were the most desirable country of the world, the new Beverly Hills for superstars, we are better than the fashion Paris and far more exciting than Las Vegas. Naturally our prices reflect our self-proclaimed super destination status. Do I need to tell you that we were wrong? Everybody dreamt of selling his piece of agricultural land for millions of rupees. Everyone is dreaming of that charming foreign prince coming out of the misty cloud, opening his fist to reveal some millions of € & $. Real estate prices shot like arrows. Mauritians could no longer afford a plot of land. I'm dedicating this paragraph to that fool offering his 2200 metre square bare land for Rs7.5 million when it’s not even worth Rs2 million. His argument: a foreigner has purchased a plot next to his... And he was talking to me; that's my field of expertise and I know that foreigners can't buy land directly! I have a dream, says every landowner.
All of those land promoters have overestimated their properties and projects. Of course, the island is heavenly, we can't deny that. But isn't it foolish to think that the whole world is dreaming to come over? Do we have the infrastructure to accommodate the high net worth individuals? Do these guys satisfy themselves sitting in a villa near the sea or on a mountain? He has a yatch and a chalet in Switzerland. It's stupid to think that we are impressing them. Their bathroom are more luxurious than many of the properties we are offering. Where does Ms Paris makes her favorite show-off session? Under the coconut tree, isolated on acres of land? A good tourist destination does not necessarily mean a good long-stay destination. Check your boredom gauge, it takes an average 7 days to visit the best attractions, if we can call these attactions in this modern world. Wake up! Out of 53 official permits given for such developments, 36 have been able to start and 12 have simply abandoned. And we blame the world.
There's no use setting up high powered committees to analyze the situation. It's so obvious. Foreigners will no longer come to the island unless we know what we really want. Incompetence is not to be tolerated but then arrogance too. People who appraise investment projects and screen investors should themselves have a strong business background or professional experience. Sorry, but I can’t figure out how people who have got no clues on business management can appreciate innovative projects coming from renowned promoters. No no, I just can't get that one to my brain. Imposing a minimum of US$100,000 per investor...and then refusing their permit despite their showing the money, and this, without any reason, is insulting. If I proved myself in my country, earned my money, then getting myself insulted in a foreign land is the last thing I would want. Can government officers shake off that arrogance of their skin and understand this point? Let's hope someday they'll have this on agenda in their lunch and dinner meetings held in 5 star hotels....built and managed by foreigners.
Be realistic, we're just an island. Dubai is crashing out, did we wonder why? The solution lies not in inviting the President of Singapore and earn air-time on our local TV; tell him humbly 'teach me Master'...and change your mindset dear government servants. Maybe then you won't need to blame the world for your failures.
Unless things change in the near future, I don't see the need to have a Board of Investment in this country and neither the reason to spend my tax money on road shows and investment promotion events worldwide.
