[Blog] Kessen Ramalingum, Chief Executive Officer of JurisTax Ltd – Budget 2024-25: a new era of economic opportunities

As we approach the crucial moment of the presentation of the national budget by the Minister of Finance on June 7, 2024, a sense of measured optimism is palpable in the country.
This Budget is particularly anticipated because it is the first since we can confidently say that the economic slowdown due to the pandemic is definitely behind us.

RECOVERY

In anticipation of the final report, the May 2024 press release from the International Monetary Fund indeed offers an optimistic outlook on Mauritius' economic recovery, highlighting a robust rebound driven by tourism and financial services.

Mauritius saw real GDP growth of 8.9% in 2022 and an estimated growth of 7% in 2023. The outlook is favourable, with real growth projected at 4.9% in 2024 and around 3.5% in middle term. These numbers align with pre-pandemic growth. Headline inflation is projected to stabilize at 4.9% on average in 2024 and 3.5% thereafter, in line with the Bank of Mauritius' medium-term inflation target.

This renewed economic vitality once again demonstrates the important role of the various pillars of the Mauritian economy, particularly financial services, towards sustainable growth.

FINANCIAL SECTOR – A SAFE VALUE

In the wake of the pandemic, the financial sector has played a key role in economic recovery. The sector maintained a stable growth rate contributing to 13.1% of GDP, which includes 6.6% in financial intermediation, 2.1% in insurance activities and 0.6% in financial leasing and others credit activities.

The dynamism of this sector and its adaptability to a changing financial landscape have consolidated Mauritius' position as a regional financial center, attracting significant foreign direct investment.

Over the years, the government has introduced various measures to strengthen the sector, such as implementing new licenses and improving services offered by the international financial center of Mauritius. It is now up to key industry players to use these as a springboard to reinvigorate the sector.

Operators are ready to exploit these new opportunities and we trust all industry partners, including the banking sector, regulators and other institutions, to fully play their roles.

The promotional efforts of the Economic Development Board (EDB), particularly in India and the Middle East have been essential in positioning Mauritius as a preferred platform for investment and business expansion.

JurisTax has had the privilege of participating in some of these initiatives, which are crucial in attracting high net worth clients to establish themselves in Mauritius. Their foreign exchange inflows go a long way in boosting demand for our rupee and contribute to the government's efforts to stabilize the value of our currency and provide further impetus to the growth of the economy.

JURISTAX – MAJOR PLAYER IN THE FINANCIAL SECTOR

JurisTax has established itself as a key entity, having skillfully evolved within this framework set up to promote a buoyant financial sector.

The company now offers a full range of services, including structuring advice, estate management, and the creation and administration of companies, funds and trusts.
Our services extend globally across financial centers such as Mauritius, UAE, Singapore, India and Delaware, ensuring tailor-made services that meet the diversified needs of businesses and investors.

NEW STRATEGY FOR THE INDIAN MARKET

Continuing its international expansion plans, JurisTax is now turning its attention to the Indian subcontinent. JurisTax recognizes the economic growth of this country. With a projected growth rate of 7.6% in 2024, India is poised to become an economic superpower.

Mauritius is well positioned to benefit from this economic boost with its cultural and economic links.

This initiative by JurisTax demonstrates that it has been able to adapt to the evolution of double taxation agreements between India and Mauritius. This time we are doing things differently by facilitating the flow of capital in the opposite direction.

Historically, Mauritius has been a preferred route for Foreign Direct Investment (FDI) to India. But this time, JurisTax in India plans to act as a gateway for Indian investors looking to explore opportunities in Africa, thereby providing strategic insights and support to enable a transition to African markets.

BUDGETARY OUTLOOK

The upcoming 2024-25 Budget is expected to maintain the momentum of economic recovery and strengthen the economic and social resilience of Mauritius. It should aim to further diversify the economy, expand exports, stimulate investments, create more jobs while addressing issues of environmental protection and climate change.

This Budget should also play a crucial role in solidifying the impact of the financial sector on the Mauritian economy in the years to come.

Mauritius' ambition to regain its high-income country status already demonstrates the nation's progress and its potential to once again achieve this status achieved in 2020 while continuing to cultivate a resilient and diversified economy to drive growth.

To be able to achieve this, one of the most important challenges remains providing us with an adequate workforce. JurisTax also recognizes the government's initiatives to address the shortage of skilled labor through targeted training programs, ensuring that all sectors of the economy as well as the financial sector continue to thrive with a skilled workforce. qualified work.

In short, the measures of the 2024-25 Budget are eagerly anticipated, because they represent a decisive turning point for the consolidation of the post-pandemic economic recovery.

With optimistic forecasts and strategic initiatives in place, the financial sector is ready to meet the challenges and exploit the opportunities that present themselves. JurisTax, as a key player in this sector, will continue to play a vital role in facilitating investments and economic development. The upcoming Budget is therefore a crucial moment that will define the trajectory of the Mauritian economy for years to come, with the hope of renewed prosperity and increased resilience in the face of global challenges.