WORLD TRADE  
ORGANIZATION  WT/TPR/M/198 
30 May 2008 
 (08-2523) 
Trade Policy Review Body 
23 and 25 April 2008   
 
 
TRADE POLICY REVIEW 
 
MAURITIUS 
 
Minutes of Meeting
 
 
Chairperson:  H.E. Mr. Bruce Gosper (Australia) 
 
   Page 
 
I.
 INTRODUCTORY REMARKS BY THE CHAIRPERSON 3  
II. OPENING STATEMENT BY THE REPRESENTATIVE OF  
MAURITIUS 4  
III. STATEMENT BY THE DISCUSSANT 9  
IV. STATEMENTS BY MEMBERS 12  
V. REPLIES BY THE REPRESENTATIVE OF MAURITIUS AND ADDITIONAL COMMENTS 22
 
VI. CONCLUDING REMARKS BY THE CHAIRPERSON 27  
 
 
     
 
    
 
    
 
  
Note:   Advance written questions by WTO Me mbers and the replies provided by Mauritius are 
reproduced in document WT/TPR/M/198/Add.1 and will be available online at:  
http://www.wto.org/english/tr atop_e/tpr_e/tp_rep_e.htm.  WT/TPR/M/198 
 Page 3 
 
 
 I. INTRODUCTORY REMARKS BY THE CHAIRPERSON 
1. The third Trade Policy Review of Mauritius was held on 23 and 25 April 2008.  The 
Chairperson H.E. Mr. Bruce Gosper (Australia) welc omed the delegation of Mauritius, headed by the 
Secretary of Foreign Affairs, Mr. Anand Priya Neewoor, and the discussant, Mr. Henning Stirø (Norway).  As usual, the discussant would speak in his personal capacity and not as a representative 
of his country.  In accordance with the established procedures, the discussant had made available, in 
advance, outlines of the main issues he intended to raise (document WT/TPR/D/173). 
2. The Chairperson recalled the purpose of the Trad e Policy Reviews and the main elements of 
the procedures for the meeting.  The report by Mauritius was contained in document WT/TPR/G/198 
and that of the WTO Secretariat in WT/TPR/S/198.   As indicated in WT/TPR/6/Rev.1, the Member 
under review should provide written answers, by the beginning of the review meeting, to questions 
submitted at least two weeks before the meeting.  Questions posed subsequently should be answered, 
to the extent possible, before the start of the second session of the meeting.  Questions left 
unanswered at the end of the second session should be  answered in writing no later than one month 
after the meeting.  Questions by the following dele gations had been submitted in writing at least two 
weeks in advance of the meeting and had been tr ansmitted to the delegation of Mauritius:  Brazil; 
Canada;  Japan;  the European Communities;  Hong Kong, China
; and Colombia .  Copies of these 
questions and of the answers provided by the delega tion of Mauritius were available in the meeting 
room.  The United States had submitted written questions after the two-week deadline.  These 
questions had also been transmitted to the delegati on of Mauritius;  copies of these questions and of 
the answers provided by the delegation of Mauritiu s would be available after the meeting.  All 
advance questions, as well as the responses received fr om the delegation of Mauritius, are reproduced 
in WT/TPR/M/198/Add.1. 
3. The Chairperson noted that the documentation prepared for this Review highlighted 
Mauritius' reform efforts in the context of a cha nging international environment.  Indeed, Mauritius 
had simplified its applied MFN tariff;  the simple average rate had been reduced from 19.9% in 2001 
to 6.6% in 2007,  and some 79% of all tariff lin es were now duty free.  It had eliminated the 
differentiation in tariff rates based on the source of imports and the differences  between the rates of 
excise duties on imports and local goods.  Moreover,  Mauritius had dismantled most of its numerous 
and overlapping incentive schemes. 
4. The reforms had begun to bear fruit, with an annual average real GDP growth of 5.1% since 
2003, based mainly on the strong growth in the services sector and the recovery of the textile industry.  
Mauritius' GDP per capita had increased by around 50% since its last Review, reaching US$5,807 in 
2007.  During most of the period under review, inflati on had been contained to some 6.5% per year.  
The central government fiscal deficit had been d ecreasing recently, albeit still high at over 5% of 
GDP. 
5. Some concerns remained, however, regarding th e increasing use of specific tariffs while the 
bindings were at ad valorem  rates, and the imposition of other duties to imports of tea at rates higher 
than the bound level of 17%.  Non-tariff barriers,  such as quotas (on potatoes and salt) and import 
licences, maintained on various grounds, undermined tr ansparency of the trade regime.  Parastatal 
bodies still had exclusive rights to import some "s trategic" products.  Price controls, including a 
maximum percentage mark-up system imposed only on imports, still applied to some "strategic" 
products.  In addition, Mauritius also faced a cha llenge of combining duty-free island plans with its 
participation in regional trade ag reements aiming at customs unions. WT/TPR/M/198 
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II. OPENING STATEMENT BY THE REPRESENTATIVE OF MAURITIUS 
6. The representative of Mauritius
 noted that Mauritius had experienced substantial and 
profound changes since 2001.  These changes, shaped  by global, regional and domestic political and 
economic developments, had had a significant im pact on the performance of the Mauritian economy 
and its international trade relations.   
7. As a small and vulnerable island State with  limited natural resources, regional and 
international trade was key to Mauritius' economic development. Its major policy drive had been to 
establish conditions for economic stability, sustaina ble growth and further integration into the 
international trading system in the face of domestic, regional and globa l economic developments. 
Therefore, for the past seven year s, the Government of Mauritius ha d continued to implement policies 
aimed at creating a more efficient, vibrant a nd outward looking economy. The aim had been to 
transform Mauritius from a mono-crop sugar producer to  an exporter of textiles and clothing, tourism 
and financial services.  This economic transfor mation had been underpinned by a strategy based on 
preferential trade to create growth and employ ment through labour-intensive, export-oriented 
manufacturing, while maintaining an elaborate social  welfare system. This welfare system continued 
to provide free education and health care, a universal basic pension for persons of 60 years old, and 
specific social benefits for vulnerable groups. 
8. This preference-based strategy and a wide range  of other economic and trade-related policies 
allowed Mauritius to make an average growth rate  of around 6% over the past three decades. The 
country was well on track to reach the Millennium Development Goals by 2015. However, Mauritius 
continued to face new and daunting challenges as a small island developing  state and a net food 
importing developing country. High vulnerability to climate change, tropical cyclones, rising sea 
levels and other natural disasters, its small size , its isolation from main markets, the cumulative 
effects of many exogenous factors, and preference erosion continued to con front Mauritius.  It was 
now facing a changing global trade environment, wh ich was set against a backdrop of soaring oil 
prices, continuing human and supply-side capacity cons traints, and public debt as well as a relatively 
high unemployment rate. 
9. The traditional productive sectors in Mauritius,  sugar and textiles, had been adversely 
affected by major exogenous shocks, including the progressive reduction in sugar guaranteed prices 
by a cumulative 36% by 2009 and the dismantling of  the Multi-Fibre Agreement.  Loss of export 
earnings in respect of textiles and sugar coupled with a rising import bill had challenged the overall 
balance of payments. The progressive price decline of sugar on the EU market, which absorbed 
around 95% of Mauritius production, would result in  895 million Euro losses in sugar export earnings 
over a period 2006-15.  The tourism and financ ial services sectors had recorded appreciable  growth 
rates, while new emerging sectors, such as ICT and seafood, had to demonstrate their full potential in 
terms of job and income creation.  At the sa me time, as a Net Food Importing Developing Country, 
Mauritius had to confront the stupendous price surge in basic food commodities which impacted 
negatively on the balance of trade.   
10. In response to these challenges, the Govern ment of Mauritius had refrained from the 
temptation of policy reversals. Indeed, as from Fina ncial year 2006, the Government formulated an 
ambitious and comprehensive ten-year economic re form programme to put the economy back onto a 
growth path of over 6% in the longer term.  Such a reform pl an, while mobilising domestic and 
market-based financial resources to the maximum, in evitably relied significantly on external resources 
to sustain it on a predictable basis. Thus, Aid for Trade was a key factor for the future of Mauritius.   
The programme was designed to prepare the tr ansition of Mauritius from a trade preference-
dependent economy to a globally competitive ec onomy. Estimated to cost around €4 billion and 
covering a string of measures underpinning four main planks, the programme aimed at overall 
rationalisation of the economy.  It encompassed all sectors, including fiscal consolidation and  WT/TPR/M/198 
 Page 5 
 
 
 improving public sector efficiency, improving comp etitiveness, enhancing the investment climate and 
democratising the economy through pa rticipation and social inclusion of all sections of society.  
11. In the area of reform of public finance ma nagement, the programme included measures to 
enhance efficiency in tax administration and collection as well as to eliminate wastage and 
inefficiencies, especially in procurement and delivery procedures. To enhance private sector 
competitiveness, a four-year tariff liberalization programme was being implemented, aimed at 
transforming Mauritius into a "duty free" island.  Th e reform package also provided for an extensive 
economic restructuring programme mainly aimed at modernizing and diversifying the sugar and 
textile/clothing sectors, consolidating the touris m and financial sectors while promoting emerging 
ones such as ICT, knowledge, seafood and land-based o ceanic industry.  The investment climate had 
been made more attractive and business-friendly by significantly reducing the cost of doing business, 
simplifying business registration and unifying all existing incentive schemes in to a transparent one.  
12. A key pillar of the reform had been the establishment of an Empowerment Programme. 
Indeed, to mitigate the effects of  liberalization and reduce existing inequalities, the reform included 
several measures to empower the disadvantaged and address needs, and facilita te the integration of 
workers into economic and productive sectors of the economy.  In concrete terms, the Empowerment 
Programme sought to ease the burden of unemploym ent, enhance job prospects and provide schemes 
for re-training for some 20,000 unemployed and r ecycled workers over five years. It had special 
programmes for women who had been particularly aff ected by closure of firms in the textile sector. 
The Empowerment Programme was also designed to  increase the financial and technical support to 
SMEs. 
13. Although the contribution of the sugar sector to GDP was relatively small (4% of GDP in 
2005), it still accounted for a significant part of total exports (17% of total e xports in 2005 and 30% of 
net export earnings from merchandise trade) as well as an  important proportion of direct and indirect 
employment and self-employment (approximately 12% of the active population). Consequently, sugar 
continued to remain an important pillar of the econo my.  Therefore, and as an integral part of the 
overall reform programme, the G overnment of Mauritius adopted  a 2006-15 Multi-Annual Adaptation 
Strategy (MAAS). The MAAS included sectoral pl ans for improving the industry's competitiveness 
and re-engineering it into a "sugarcane cluster" in order to reduce production costs and enable 
Mauritius to remain a competitive supplier. This shoul d be attained by conso lidation of the industry, 
rightsizing of the labour force and optimizing the u se of sugarcane by-products for energy production 
including ethanol.  To minimize its social im pact, the sugar reform programme provided for a 
generous retirement package, which included re-training of employees going on the Voluntary 
Retirement Scheme, and their re-integrati on into revenue-generating activities.  
14. The overall reform programme charted a new cour se towards more market-driven, transparent 
and rules-based economic management system. To achieve the objectives targeted by the reforms 
would require adequate planning and preparatio n of long-term development plans and sectoral 
strategies, as well as enhanced access to financing.  The speed and breadth of Mauritius' reform 
efforts would, to a great extent, be a function of  its ability to address its human and trade-related 
infrastructure constraints.  They would also depend on Mauritius' ability to mobilise necessary 
funding for the programme. To this end, the Government of Mauritius was seeking the required 
internal and external financial resources throug h a series of measures: improving fiscal management, 
attracting more investment, inviting the Mauritia n Diaspora to return and participate in the 
development of Mauritius.  Importantly, the Gove rnment was seeking to mobilise both market and 
concessional financing under the Aid for Trade Initia tive. Indeed, Mauritius had been making its case 
on the international scene for such financing to also cover assistance to enterprises undergoing 
restructuring plans and social costs of adjust ments. Delays in accessing such financing would 
certainly undermine implementation of reforms.  WT/TPR/M/198 
Page 6  
 
15. The performance of emerging sectors like the seafood hub and Information and 
Communication Technology (ICT) would be a test case for the success of Mauritius' transition from 
the traditional sugar and textiles pillars to the ne w pillars of the economy. A key challenge for the 
Government was to address the country's human sk ills shortages and other capacity constraints in 
order to support the development of these emergi ng sectors.  Another important challenge to be 
addressed was Mauritius' dependency on importe d petroleum products to meet its energy 
requirements. Indeed, Mauritius was heavily dependen t on imports of fossil fuels (80% of electricity 
requirements and 100% of transport needs) and in particular oil products. The soaring price of oil 
increased its vulnerability, particularly so as the socioeconomic development required fairly stable, 
regular and substantial energy supply , in both the medium and long term.  
16. In the framework of restructuring the sugar indus try and creation of flexi-factories, there were 
plans to expand and optimize the contribution of bagasse in electricity production, in order to  partly 
substitute the use of fossil fuels.  But for the long  term Mauritius needed to fully tap its potential to 
increase the use of local and renewable energy sour ces such as biomass, hydro, solar and wind energy.  
The increase in the fleet of motor vehicles for the past decade had aggravated pressure on road 
capacity and extended travel times and negative e ffects on the environment. The Government had 
undertaken to implement an integrated plan for traffic decongestion and public transport 
improvement.  Mauritius foresaw major challenges fo r its port to sustain a competitive, as well as 
safe, secure and environmentally sound maritime  transportation system based on internationally 
agreed standards.  Furthermore, the development of  tourism had had a drama tic impact on air traffic 
and airport and aviation services. Airport facilities,  would have to be upgraded in order to handle 
growth in passenger and aircraft movement and freight volumes in line with the Government's 
intention to cater for 2 million tourists by 20 15 and to raise the level of air freight cargo. 
17. The success of Mauritius economic reforms would also depend on a proper regulatory 
framework for improving the investment climate. In  this regard, the Government of Mauritius had 
adopted a series of measures to make the regu latory environment more transparent and less 
burdensome. Thus, the different incentive schemes ha d been streamlined. For instance, development 
and building permits had been merged, and the system administered on the basis of ex post 
verification rather than ex ante approval, with the goal of reducing the time to start a business to three 
days (from 46 in 2005).  The Board of Investme nt of Mauritius had been converted from an 
administrator to a facilitator and promoter of investments. The aim was to secure a position for 
Mauritius in the top ten most investment- and bus iness- friendly locations in the world. The tax 
system and tax policy had been totally reengineered . The focus had been on a simple tax system, light 
taxation and equity.  In the same vein, the Govern ment of Mauritius had adopted a series of measures 
to improve trade competitiveness.  
18. In April 2005, the 10% additional duty was rem oved.  Thus customs tariffs became fully 
compliant with the Most Favoured Nation Principle of  the WTO. Furthermore, in 2005 the top tariff 
rate was lowered from 80% to 65% a nd tariffs were eliminated on a large number of products.  From 
2006, the tariff structure was being overhauled and tariff liberalization was being accelerated with a 
view to moving towards a dut y-free island. The maximum ad valorem tariff was brought down from 
65% to 30% and the rates of 65% , 55% and 40% were lowered to 30%.  Additionally, the tariff 
structure had been simplified with only three non-zer o bands (10,15 and 30%) compared with seven.  
To-date, 79% of all tariff lines had become duty free and the simple average tariff rate had been 
brought down from 9.5 to 6.6%. Numerous changes had been brought to excise duties, especially to 
achieve compliance with the Most Favoured Nation Pr inciple and the National Treatment Principle of 
the WTO. 
19. In terms of Trade Facilitation, Mauritius ha d adopted a programme for the reform and 
modernisation of Mauritius' Customs facilities to provi de a world-class service to stakeholders. This 
included a single document for implementation pr ocedures, risk assessment and management 
techniques, post audit clearance, publication of cu stoms-related information on the Internet, voluntary  WT/TPR/M/198 
 Page 7 
 
 
 compliance and single-window facilities.  Increased re gional trade, mainly in the Indian Ocean and 
mainland Africa, was central to its development. Ma uritius, therefore, continued to actively support an 
agenda of rapid and effective regional integration.  In this respect, Mauritius had continued to be an 
active player in the regional negotiations at th e level of the Southern African Development 
Community (SADC), the Common Market for Easter n and Southern Africa (COMESA), the Indian 
Ocean Rim Association for Regional Co-operatio n (IOR-ARC) and the Indian Ocean Commission 
(IOC) with the aim of facilitating trade and econom ic cooperation through the removal of tariff and 
non-tariff barriers, and harmonization of the va rious standards on sanitary and phytosanitary 
measures, and technical regulations.  In this pursu it, the country aspired to a fully effective FTA 
encompassing COMESA and SADC. 
20. Besides its regional integration interests, Maur itius would continue to strengthen bilateral 
economic ties with key trading partners and to forg e new strategic partnerships with them. In this 
respect, Mauritius and India were set to conc lude a Comprehensive Economic Cooperation and 
Partnership Agreement (CEPCA). Moreover, Mauritiu s and Pakistan signed a Preferential Trading 
Agreement in 2007, and discussions were on-goi ng for an FTA between the two countries. 
Negotiations for similar agreements were under wa y with other Asian countries including China.  
Mauritius had observer status in the South Asian Association for Regional Cooperation (SAARC) and 
had applied for a similar status with the Asso ciation for South East Asian Nations ASEAN. 
21. A Trade and Investment Framework Agreemen t (TIFA) between Mauritius and the United 
States was signed in 2006 in Washington with the objective of strengthening and expanding trade ties between the two countries.  The TIFA also provided the opportunity to work more closely on a broad 
range of issues, including moving the WTO Doha Development Round forward, and on 
implementation-related issues with respect to th e African Growth Opportunity Act (AGOA). Both 
countries were working on the conclusion of a Bi lateral Investment Treaty.  Under the ACP-EU 
Cotonou Partnership Agreement, Mauritius was one of the members of the Eastern and Southern 
Africa region currently finalizing an Economic Partne rship Agreement with the EU. With a view to 
preventing any trade disruptions, Mauritius together  with four ESA countries (Madagascar, Comoros, 
Seychelles, and Zimbabwe) initialled an interim EPA agreement involving the trade in goods 
provisions, development chapter as well as issues where agreement had been achieved, including 
fisheries. Negotiations were continuing in 2008 to  complete a full and comprehensive EPA and would 
focus on the outstanding issues, including trade in services, investment, and trade facilitation. 
22. While Mauritius' objective was to diversify away from traditional markets to reduce 
dependency and concentration, the EU and the Un ited States would remain its main export markets 
for a long time to come. It was in this context th at Mauritius attributed the highest importance in its 
economic diplomacy to the EPA negotiations w ith the EU and to AGOA and TIFA regarding 
Mauritius' relations with the United States.  Mauritiu s was committed to a multilateral trading system 
which was fair and balanced. Mauritius had activ ely participated in all the WTO Ministerial 
Conferences since the Uruguay Round and was curren tly heavily involved in the Doha Development 
Round negotiations. The final outcome of the D oha Round, particularly in Agriculture, NAMA, 
Services and Rules (including fisheries subsidies) , satisfactorily addressed both Mauritius' defensive 
interests and offensive ones including the mainte nance and expansion of Mauritius current market 
access opportunities. Mauritius had been persistently  supporting calls for the development dimension 
of all issues under the WTO Doha Round of negotiati ons to be duly addressed and form an integral 
part of any final outcome. 
23. Therefore, Mauritius as an individual Memb er and within its supporting groups (ACP, 
African, SVE groups and other them atic groups) would continue to play its part for a successful 
conclusion of the Round with an outcome which was satisfactory to all and with operationally 
effective special and differential treatment fo r developing countries including LDC's and SVEs.   In 
conclusion, the long-term prospects of Mauritius look ed good in spite of the challenges confronting it WT/TPR/M/198 
Page 8  
 
as a small and vulnerable economy and NFIDC. On the basis of its performance over the past quarter 
century, it was striving to build sufficient resilience in the face of a difficult structural transition and 
exogenous shocks. If Mauritius' amb itious reform programme succeeded in attaining its objectives, 
along with other factors, annual growth at a reasona ble level should be feasible. One of these other 
factors was that the Doha Round delivered on its development agenda. Another was that Mauritius' 
bilateral and institutional developm ent partners would fulfil their commitment to supporting it in its 
development efforts under the Aid for Trade framework.   WT/TPR/M/198 
 Page 9 
 
 
 III. STATEMENT BY THE DISCUSSANT 
24. The discussant  (Mr. Henning Stirø) cited a speech on the website of the Government of 
Mauritius, given by the Governor of the Bank of Mauritius, who pointed out that at the time of independence, 40 years ago, Mauritius was, by all m easures, a poor country with a per capita income 
of less than US$200 and that an economic commiss ion recommended emigration as a key part of the 
solution to the island’s problems. The discussant ag reed that Mauritius had come a long way in the 
relatively few years which had passed since then. 
(i) Economic environment 
25. Mauritius was an upper middle income country, with, according to World Bank figures, a per 
capita income in 2006 of US$6,431 or US$11,643 in purchasing power parity terms. The most recent 
edition of the UNDP Human Development Report ranked Mauritius second highest among the sub-
Saharan African countries (after Seychelles), and 65th in the overall ranking of 177 countries. 
Transparency International ranked Mauritius 53rd of 179 countries in its Corruption Perceptions 
Index, and The Ibrahim Index of African Gove rnance ranked Mauritius as the very best of 48 
countries. 
26. Mauritius had a relatively diversified, export-or iented economy based on four pillars (sugar, 
textiles and clothing, tourism, and financial service s). This structure was a heritage of preferential 
access to certain key markets, as well as incentiv e schemes which helped boost export-oriented 
manufacturing. However, the relative importance of the four pillars was changing.  Mauritius was 
facing a "triple shock" after two decades of strong economic growth.  Preference erosion, following multilateral liberalization of trade in textile and clothing items, and the reform of the EC sugar 
regime, together with soaring international o il prices, had been challenging Mauritius' economic 
performance.  As a result, its economic growth had sl owed down.  Since the last review in 2001, the 
economy had grown by some 3.3% per year (on av erage) with weak performances in 2002 (1.9%) and 
2005 (1.2%).  Recent reforms had nevertheless revived GDP growth, estimated at 3.9% in 2006 and 5.6% in 2007.  This was based mainly on the strong  growth in the services sector and the recovery of 
the textile industry. 
27. Macroeconomic policies contributed to containing inflation.  However, inflation rose to 8.9% 
in 2006, and to 10.7% in June 2007, the highest in over a decade.  For Mauritius, which was a net 
food-importing country, recent food price increases w ould contribute to inflationary pressures. The 
discussant asked if inflation was seen as a problem for Mauritius, and if so, what measures had been 
taken to curb it.  The Government had stressed th at the price surge in basic food commodities had led 
to a deterioration of its balance of trade, ha d put strain on its food sourcing capacity and had 
constrained policy options. This situation posed ch allenges to a great number of countries. He was 
interested to hear the Mauritian delegation's view s on how the challenge of increasing food prices 
could best be tackled. 
28. Labour market rigidities resulted in real wa ges growth exceeding increases in productivity.  
This, together with the lack of new employment  opportunities, continued to increase unemployment, 
which rose from 6.8% in 2001 to some 9.5% in 2005 and 9.2% in 2007. As Mauritius shifted 
progressively toward a service-dominated and knowledge-based economy, labour-market flexibility 
became more important. The Government was work ing to implement labour market reforms.  As 
increasing labour market flexibility was difficult in any country he was interested to learn more about 
the Mauritian way to tackle this challenge. WT/TPR/M/198 
Page 10  
 
(ii) Trade and investment regimes 
29. Mauritius was a highly trade-dependent country, with goods and services trade reaching close 
to 135% of GPD in 2006. Trade policies were an in tegral part of economic policies. They were aimed 
at, in the final analysis, improving the living standards of the population and ensuring full employment through an accelerated transition towards a globally competitive economy, which was 
growing at high rates. Mauritius had achieved proper mainstreaming of trade into national 
development plans;  which was seen as essential in an  Aid for Trade context, but was lacking in too 
many countries. 
30. Mauritius had ambitious trade policy objectives and intended to realize the vision of "the 
Duty Free Island", where Mauritius was transformed into a globally competitive economy.  To bring 
this about, Mauritius embarked on bold structural  reforms. A ten year reform programme was 
announced in the Budget for FY 06/07. The cost  of the reform programme was estimated at 
EUR 4 billion, of which half was expected to be financed out of domestic resources. The remaining 
half would have to be met by FDI and external assistance and Mauritius expected that Aid for Trade 
would be instrumental in this respect. He asked th e Mauritian delegation if it considered it possible to 
obtain the desired concessional fina ncing under current arrangements with  external partners, or if it 
was as imperative that new Aid for Trade-arrangemen ts were put in place in order to raise the 
necessary funds. 
31. Mauritius was an active participant in the WTO, putting its mark both in the DDA 
negotiations and outside it. In the DDA, Mauritius re mained a champion of the interests of the SVEs 
and a vocal proponent of developing country concer ns in general. Notifications to the WTO were 
pending in several areas, most notably under the Agriculture Agreement, where no notification had 
ever been made. This was a situation the Gove rnment of Mauritius should aim at rectifying.  
Mauritius was not a signatory to the WTO plurilatera l Agreements. Mauritius had noted that increased 
competition played an important role in enhancing the efficiency of its economy, and acceding to the 
Government Procurement Agreement seemed to be an option worth considering. The discussant noted 
that it would be useful to hear th e Mauritian delegation assess this option. 
32. In addition to the multilateral track, Mauritius pursued bilateral and regional preferential 
arrangements to safeguard its trade interests. Mauritius participated in a number of regional 
agreements, some of which had overlapping member ship and some of which appeared to have 
conflicting aspirations, in particular, the forthc oming COMESA Customs Union and SADC ambitions 
in the same direction. He wanted to know if th e abundance of regional arrangements was a source of 
concern for Mauritius.  The relations between the AC P States and the EU were a particularly topical 
issue in view of the negotiations on Economic Partnership Agreements. Mauritius recently signed a 
so-called stepping-stone agreement, which took effect  on 1 January. In the light of the divergent views 
which were being expressed on the EPAs, he asked if the Mauritian delega tion could reflect on the 
benefits and challenges to Mauritius of the EPA. 
33. Mauritius had streamlined and simplified its inv estment regime since 2001. FDI to Mauritius 
had increased tenfold during the period of revi ew, from R936 million in 2001 to R9001 million in 
2007. However, the discussant had noted a particular  sentence in the Secretariat’s report, regarding 
the investment regime, in paragraph 77 on page 31, that a Global Business Company "may carry out 
any activity unless it is unlawful, contrary to public  interest or may cause prejudice to the good repute 
of Mauritius as a centre for financial services".  He  wondered if the two latter clauses imparted the 
predictability that the foreign investor so desired. 
34. Mauritius had undertaken major trade-related reforms during the peri od under review. As 
steps towards the realisation of a duty-free island, the simple averag e applied MFN tariff had been cut 
by two thirds, from 19.9% to 6.6%. Some 79% of tariff lines were now duty-free. However, specific 
duties had been on the increase, from two lines in 2 001 to 5.9% of total lines in 2007, with AVEs up  WT/TPR/M/198 
 Page 11 
 
 
 to 277.5%. Increasing the binding cover and reducing the differenc e between bound and applied rates 
would enhance predictability. He was interested to know if the concept of the duty-free island was to 
be taken in its literal sense, or whether it was a vision pointing out the direction to be followed. 
35. During the period under review Mauritius had done away with the differentiation of customs 
duties depending on source – a discrimination be tween scheduled and non-scheduled territories. 
According to the Government report this made the tariff regime fully compliant with the MFN 
principle and this was welcomed.  The Secretar iat report listed a number of non-tariff barriers: 
quantitative restrictions, certain import controls , and exclusive rights over imports by several 
parastatal bodies. Taken together these arrangements seemed to establish a fairly complex system. He 
asked if the Government of Mauritius intended to address these complexities as part of its reform 
programme. 
36. The description of the customs reform and modernisation programme was like a list of the 
proposals compiled for the DDA Trade Facilitation ne gotiations (risk assessment and management 
techniques, provisions for post clearance audits, in ternet publication, single window, and fast track 
procedures available to traders with a proven hist ory of compliance) and was very impressive. The 
World Bank published an in teresting report called Connecting to Compete – Trade Logistics in the 
Global Economy in which 150 countries were ranked on a Lo gistics Performance Index and Mauritius 
ranked as number 132. With the state-of-the-art TF measures that Mauritius implemented, the 
discussant had expected to find the country much higher up on the list. Upon reflection he believed 
that a reason for the relative poor ranking – apart from possible methodological explanations – was 
that the Logistics Performance Index took a broade r approach than the normal Trade Facilitation 
perspective, and that there were, somewhere in th e Mauritian supply-chain, weaknesses that this index 
could help to identify.  In order to balance this slightly bleak observation, another World Bank report, 
namely Doing Business 2008,  measured 10 indicators on the ease of doing business in 178 economies, 
and ranked Mauritius in a very flattering position as number 27. 
(iii) Sectoral policies 
37. The Mauritian economy was still based on four pilla rs (sugar, textiles and clothing, tourism, 
and financial services). Efforts were being made to  develop the ICT sector into a fifth pillar of the 
economy. An attempt was being made to transf orm Mauritius into a seafood hub by developing value-
added fisheries and seafood-related activities. The G overnment placed high hopes on this sector, but it 
had relatively little coverage in the Government report. He was interested to learn more about plans 
and expectations for the fisheries sector.  Suga r was the main branch of the agricultural sector. 
Mauritian sugar exports were subject to price cuts  of 36% over the four years from 2006 to 2009. In 
the light of this, a reform programme was put in place in 2005, aimed at, inter alia,  transforming the 
sugar sector into a more efficient and competitive sugarcane cluster, while continuing to fulfil its 
multifunctional role. He asked if the Mauritian dele gation could indicate whether the reforms were 
having the intended effects. 
38. Mauritius had achieved remarkable economic and social success in the past, based on good 
governance and an exceptional use of trade preferenc es for sugar and clothing. Recent external shocks 
forced resources out of traditional ways of organising  production and distributi on, over to other parts 
of the economy where value added was perhaps gr eater. The externally induced problems perhaps 
facilitated the adoption of policies which under norma l circumstances would have been met with more 
resistance. Taken together, this held out the pr omise that the Mauritian economy would emerge from 
adverse conditions better equipped for competition in the global marketplace. Mauritius was still 
vulnerable to the changes taking place in the world economic environment, but, with luck and help, 
the continued pursuit of reforms would make  the economy increasingly more robust.  WT/TPR/M/198 
Page 12  
 
IV. STATEMENTS BY MEMBERS 
39. The representative of Brazil
 noted that trade was a major element in Mauritius's good 
economic performance, despite the external shocks that  affected its trade balance.  Even with those 
adverse conditions, merchandise expor ts grew almost 50% since 2001, and imports almost doubled.  
Mauritius had been able to partially offset its trad e deficit in goods with growing dynamism in the 
services sector, in which it was a net exporter. Activities such as tourism, financial services and 
telecoms were developed and s till being improved.  The impressi ve trade performance of Mauritius 
could be attributed to bold economic reforms.  Ta riff simplification and lower tariff rates were pursed 
to enable cheaper imports of inputs and consumer goods.  The Sugar Sector Strategic Plan aimed to 
raise productivity, lower costs and to promote th e use of alternative goods related to sugar cane 
production.  The generation of electricity from ca ne bagasse and the production of ethanol to be 
blended with petrol for the use in vehicles, besi des promoting clean energy, were important initiatives 
for a country dependent on coal and oil imports.  Big investments had been made in the tourism sector.  Mauritius was further developing its telecom and ICT infrastructure in order to become a "cyber-island" in the Indian Ocean.  Significant pol icy and legal reform had further strengthened the 
financial regulatory framework.  As a result of such reforms, the GDP ha d grown, and annual FDI 
inflows had increased almost three-fold.  Moreover,  Mauritius was an important investor in Africa. 
Nevertheless, many problems remained:  the cu rrent account deficit was widening, unemployment 
rates had increased, and the trade re gime still needed adjustments. 
40. Mauritius' foreign trade was still concentrated with the European countries and the EU in 
particular.  But Mauritius had been able to diversif y its trade partners. Brazil encouraged Mauritius to 
increase its efforts to diversify its trade relations hip with regional partners as well as with other 
developing countries, while still participating activ ely in the multilateral trading system and to 
consider acceding to the GSTP.  Moreover, the new markets in the developing world could help 
Mauritius to mitigate the effects of preference eros ion of its exports in the developed countries.  
Mauritius's tariff profile had low rates, with an av erage applied MFN tariff of 6.6%.  Nevertheless, 
use of specific duties had increased and, even though almost 80% of  tariff lines were duty-free, some 
sectors were still protected (tobacco, sugar products and beverages).  Mauritius was well placed to 
benefit from the Aid for Trade initiative in order to improve its production capacity and cope with the 
negative short-term effects of trade liberalization.  It had been one of the major beneficiaries of trade-
related technical assistance, and its example show ed how well-developed na tional strategies could 
help developing countries to use international trade as an engine for growth  and development.  The 
representative noted that bilateral trade between Mauritius and Brazil was diversified but there was 
still much room for improvement.  Brazil hoped to fu rther expand and improve their bilateral trade 
and that Mauritius would retain its commitment to the multilateral trading system and would continue 
its engagement in the Doha Round. 
41. The representative of Canada
 said that imports from Mauritius had doubled in 2007 over 2006 
levels (mainly iron and steel, clothing, scientific  and precision instruments, and sugar products).  
Canadian exports to Mauritius rose significantly in  2007 up over 80% (mainly vegetables, electrical 
and mechanical machinery and equipment, plastics and plastic products, and pa per and paperboard).  
He congratulated Mauritius for the structural ch anges and the bold reforms that it had undertaken 
aiming at diversifying its economy and liberalizing its  trade regime.  He encouraged Mauritius plans' 
to further develop the informatics and the in formation and communication technology sectors as 
pillars of its economy as Canada recognized the import ance of these sectors as enablers to growth in 
the new economy.  Canada supported Mauritius in th e development of a transparent, predictable, 
rules-based international trade regime and comme nded Mauritius' overall commitment to the WTO. It 
contributed significantly to the advancement of the WTO Work Programme on Small Economies and 
the Aid for Trade initiative.  Canada also recogni zed Mauritius' commitment to the Doha Round of 
negotiations, where it made importa nt contributions through its work with, for example, the ACP and 
the African Group.  WT/TPR/M/198 
 Page 13 
 
 
 42. The representative of Japan  appreciated the highly predictable investment climate in 
Mauritius.  He underlined that socio-political st ability, a relatively diversified economy and recent 
economic reforms had helped to attract investme nt into Mauritius. The World Bank supported this 
fact by ranking Mauritius as the highest in African  countries in its report "Doing Business 2007".  For 
further FDI, Mauritius had set its policy target to wards a "Duty Free Island", as well as simplified its 
taxation system in 2007.  Mauritius’s effort to a bolish the provision that local companies producing 
primarily for the domestic market were eligible for reductions of corporate tax was appreciated.  
Investments had been diversified.  Mauritius par ticipated actively in WTO activities and negotiations. 
At the same time, the Government report stated that the "one-size-fits-a ll approach" would penalize 
the small, weak and vulnerable economies with th e risk of marginalization. Japan recognized 
Mauritius as a "gateway" to transmit economic dynamism in Asian countries to African countries. Mauritius should be supported for further integra tion into the multilateral trading system in an 
appropriate manner.  
43. Japan mentioned its on-going support to Mauritius, namely "TICAD IV" in May 2008. In 
order to strengthen the recent positive trends in A frica in both political and economic areas, concrete 
initiatives by the international community  would be discussed under the theme of  "Towards a Vibrant 
Africa: Continent of Hope and Opportunity".   Since the previous review, Mauritius had enacted a 
number of new intellectual property laws, with the aim of bringing its legislation into conformity with 
the WTO agreement.  The enforcement of IPR was al so taken into serious consideration. In this 
regard, Japan asked if Mauritius could clarify furthe r institutional functions and actual activities of the 
IPR Unit and the Anti Piracy Unit of the Police Forc e.  Mauritius was commended for its effort since 
the previous TPR to reduce maximum tariff rates;  the number of duty-free lines had increased to some 79% of all tariff lines. This had contributed  to lowering the simple average MFN tariff from 
19.9% in 2001 to 6.6% in 2007. Mauritius had also  eliminated the differentiation in tariffs depending 
on the source of import and in excise duties. However, the 15.7% binding rate of tariff lines needed to 
be improved.  Japan hoped that Mauritius would make good use of this TPR as a tool to further 
improve its trade and economic policy and share its current issues with other Members so that it would further benefit from the multilateral trading system. 
44. The representative of th e European Communities
 noted that Mauritius was one of the most 
dynamic, and open African economies:  this was the result of the implementation of far-reaching trade reforms in the recent years.  He congratulated the Government for its ambitious 10-year reform 
programme designed to prepare the transition of  Mauritius from a trade-preference dependent 
economy to a globally competitive economy.  The inv estment climate had been made more attractive 
by significantly reducing the cost for business by  simplifying business regist ration and unifying all 
existing incentive schemes into one.  However, fu rther efforts would be needed to reduce the fiscal 
deficit by addressing the serious fiscal situation. Mauritius was encouraged to sustain its reform 
efforts in order to achieve more market-driven, transparent and rule based  economic management and 
a more competitive and diversified economy. An important pillar for the success of the reform 
programme would be to ensure an open dialogue w ith all stakeholders rega rding its implementation 
and social impact.  The EC was Mauritius' major trad ing partner and largest investor in the country.  
The EC had been supporting economic reforms in Mauritius channelled through different EDF 
programmes. The Sugar Accompanying Measures of  a value of Euro 127 Million for 2007-10 would 
be channelled through General Budge t support in order to modernise the sugar sector of Mauritius and 
thus to attenuate the impact of the EU Sugar Ma rket Reform. The EC and Mauritius (as a member of 
the Eastern and Southern African group)  initialed an Interim Agreement on 4 December 2007 with a 
view to gradually phasing out barriers to trade a nd enhancing trade cooperati on.  Negotiations on full 
EPAs were envisaged to be concluded by the end of 2008.   
45. Mauritius had announced its plans to become a duty-free island in the immediate future by 
pursuing ambitious tariff liberalization, including reduction of maximum tariff rates and increasing 
the number of duty-free lines. In parallel, Mauritius ac tively participated in regional negotiations with WT/TPR/M/198 
Page 14  
 
a view to further facilitating trade between neighbour ing countries and creating larger markets. In the 
EC's view, Mauritius was pursuing two different trad e policy objectives which needed to be clarified. 
The EC was interested to learn how Mauritius aime d to reconcile its plans to become a duty-free 
island with its active engagement in constructi ng a Customs Union within COMESA. Mauritius had 
made significant efforts in reducing its applie d tariffs. Nonetheless, the gap between bound and 
applied rates remained significantly large.  Mauritiu s was encouraged to make  further commitments in 
order to close this gap between applied and bound rates. This would lead to increased predictability 
and foster more trade and investment in Mauritiu s.  Enhanced transparency would increase the 
efficiency of government procurement policies and would facilitate foreign direct investment in 
Mauritius. The entry into force of the new Pub lic Procurement Act as of 17 January 2008 was 
welcomed.  A transparent and effective implementa tion of the Public Procurement Act was key for 
the good functioning of public procurement in Ma uritius. The EC was interested to learn about 
Mauritius' experience and assessment of the first months of implementation of the new Public 
Procurement Act, and invited Mauritius to consid er becoming an observer to the WTO Agreement on 
Government Procurement.  To conclude, the EC wa s pleased by Mauritius' active role in the ongoing 
DDA which positioned it very well to benef it from an ambitious result in the DDA. 
46. The representative of Hong Kong, China
 noted that Mauritius and Hong Kong, China 
maintained good trade relations with bilateral tr ade increasing by an annual average rate of 14% 
between 2005 and 2007.  Services constituted a dominant  part of Mauritius' economy in terms of GDP 
and were considered by Mauritius as the main area for further economic diversification.  A continued 
effort to liberalize trade in services would be beneficial for its further economic growth and 
sustainable development.  Hong Kong, China commended Mauritius' initiatives and efforts to 
undertake a series of regulatory reforms in teleco mmunication and financial services, and encouraged 
Mauritius to continue these efforts so as to creat e a more competitive environment for trade in 
services, and increase the overall competitiveness of its  economy.  He also encouraged Mauritius to 
improve its GATS commitments in a revised offer to enhance the legal certainty and predictability of 
its services regime.  Liberalization and further commitments in the maritime transport and logistics 
sectors would enhance the sectors' competitiveness and would be in line with Mauritius' development 
strategy.  On goods, Mauritius maintained ad valorem  rates for 94% of its tariff  lines, 79% of its tariff 
lines were duty free, and the overall average applie d tariff declined from 19.9% in 2001 to 6.6% in 
2007.  Mauritius eliminated the differentials in cu stoms and excise duties among goods from different 
origins, as well as between imports and local goods. However, some high tariffs still existed on some 
manufactured goods. Even if Mauritius was a "paragra ph 6" country, it should consider lowering its 
tariffs and increasing its binding coverage in accord ance with its development needs.  Mauritius had 
undertaken reforms to accelerate cu stoms clearance, and it should continue the process of customs 
reform to facilitate trade flow.  The Mauritius au thorities reviewed technical standards every five 
years with a view to aligning them with internati onal standards, and this process would help ensure 
that technical standards would not create unnecessary barriers to trade. 
47. The representative of Colombia  noted that Mauritius had developed from a low-income 
economy based on agriculture to a middle-income diversified economy with  growing industrial, 
financial and tourism sectors.  Its economy had gr own significantly, attracted considerable foreign 
investment and earned one of Africa's highest per cap ita incomes.  This was reflected in increased life 
expectancy, lower infant mortality and an impr oved infrastructure.  Many languages were spoken 
fluently in Mauritius, it had great achievements regarding the Millennium Development Goals and 
had a high place in the UN Human Development I ndex. Its economic development strategies were 
now less dependent on trade preferences, but rather  on the global competitiveness of local products.  
He commended this policy and suggested its car eful review by WTO Members concerned with 
preference erosion.  Mauritius had modified its fo reign investment promotion strategy from granting 
numerous and overlapping incentives towards a low-tax and targeted project promotion strategy.  The 
representative of Colombia urged Mauritius to notif y its measures to the WTO under the Agreement 
on Agriculture.    WT/TPR/M/198 
 Page 15 
 
 
 48. The representative of the United States  noted that Mauritius and his country enjoyed a 
constructive bilateral relationship in which trad e and investment played a major role.  Both 
governments consulted bilaterally under the Trad e and Investment Framework Agreement (TIFA) 
signed in 2006, which provided opportunities to  explore common objectives on a regular basis, 
including their participation and cooperation in the WTO.  Mauritius benefited from the U.S. African 
Growth and Opportunity Act (AGOA).  In 2007, the value of U.S. imports from Mauritius under 
AGOA and the Generalized System of Pref erences (GSP) programmes was US$120 million, 
representing 64% of U.S. total imports from Mauritiu s.  The Government of Mauritius had recognized 
that preference programmes, while helpful, could not be the ultimate response to the fundamental 
challenges of economic growth and development.  Mauritius begun to tackle the complexities of 
economic reform, becoming a positive African mode l of how market-opening strategies could fuel 
development and spur economic di versification.  In July 2006, Mauritius embarked on a bold 
economic reform programme that aimed to move the nation away from reliance on trade preferences 
and toward greater global competitiveness.  Maur itius maintained a market-based economy with a 
strong, dynamic private sector.  Considered as an upper-middle-income country, Mauritius’s GDP per 
capita grew from almost US$3,800 in 2001 to about US$5,800 in 2007.  In the World Bank’s Doing 
Business 2008  report, Mauritius ranked 27 out of 178 count ries on the ease of doing business, this was 
the highest among African countries. 
49. Mauritius aimed to become a duty-free island.  The Government had reduced its top import 
duty from 65% to 30% and had increased the number of duty-free lines to some 79% of the total.  This helped reduce the simple average MFN tariff from 19.9% in 2001 to 6.6% in 2007.  Mauritius 
was urged to increase the number of its bound tariff lines and to lower the ceiling rates.  Mauritius’s 
trade regime would benefit from reducing the gap between applied and bound duty rates.  Mauritius 
was commended for eliminating the differences be tween the excise duty rates on imports and local 
goods, and for applying VAT to both imports and dom estically-produced goods.  The Government’s 
trade facilitation efforts were welcomed, includi ng its steps to accelerate customs clearance.  
Adequate and effective protection of  intellectual property rights conti nued to be a major U.S. concern, 
and Mauritius had enacted a number of new laws since its last TPR in an effort to conform to the 
WTO TRIPS Agreement.  Mauritius had also establishe d enforcement regulations.  The United States 
wished to know more about the Police Department’s  new Anti-Piracy Unit a nd the Unit’s activities.  
Mauritius maintained non-tariff barriers on numerous pr oducts in the form of quantitative restrictions, 
import permits or bans.  Furthermore, the State intervened in activities through several parastatal 
bodies that market or supply products or services.   There were outstanding notifications requiring 
Government action, including those under the Agreement on Agriculture. 
50. In October 2007, the United States joined other WTO Members in granting a second and final 
extension until 2015, for Mauritius to eliminate its  export subsidies under the Freeport Scheme duty 
and excise tax concessions and corporate tax exem ptions.  The representative asked what steps 
Mauritius had taken to advise beneficiaries that thes e export subsidies would be terminated and what 
steps were being taken to phase-out these programmes.  The services sector was the largest contributor to Mauritius's GDP.  In general, Mauritiu s's applied services regime was more liberal than 
its GATS commitments.  By modifying its existing services commitments to reflect its more liberal 
applied regime, Mauritius would benefit from attrac ting new investment, especially in key areas of 
infrastructure.  Mauritius was actively engaged in the Doha Development Round with contributions to 
the negotiations, and was urged to consider the additional global ma rket opportunities that would arise 
from a meaningful Doha Development Round outco me.  The United States commended Mauritius’s 
trade policy reforms.  Backed by structural refo rm and macroeconomic stabilization, continued trade 
and investment policy reforms would allow Mauritius to compete for new opportunities that would result from successful Doha Development Round negotiations.   
51. The representative of Benin
 welcomed the considerable e fforts made by Mauritius which 
enabled it to achieve an annual growth rate of 5.1% of its GDP, with a good cap on inflation, WT/TPR/M/198 
Page 16  
 
continuing the construction of a dynamic and dive rsified economy. Mauritius was bravely facing the 
"triple shock" resulting from preference erosion, the reform of the sugar regime and the rise in world 
oil prices. He underlined Mauritius' performances in trade in services, particularly financial services, 
tourism and telecommunications, as well as in the sect or of textiles and clothi ng. The various reforms 
since the fiscal year 2005-06 and the Triennial  Programme of 2006-09, making Mauritius a duty-free 
island, would promote further the good performanc es already recorded. Mauritius was working to 
implement the WTO Agreements and was exemplary in its participation in the Doha Round Trade 
Negotiations. Mauritius had to be s upported in its efforts to enable it to continue smoothly the 
initiated reforms. 
52. The representative of Argentina
 appreciated the effort made by Mauritius to adjust its 
economy to the changing circumstances of the worl d economy.  He considered that although there 
were still some pending questions and tasks, ope ning the economy, consolidating trade ties and 
strengthening the multilateral system were the appr opriate approaches to tackle these challenges.  
Trade ties between Mauritius and Argentina were rather small but they were becoming deeper. 
53. The representative of Tunisia  welcomed the various economic and trade measures taken by 
the Government of Mauritius, as well as the effort s and adjustments made despite a difficult global 
economic environment and the difficulties encountered  (inflation, unemployment, trade shocks caused 
by the trade preference erosion in sugar and textil es, the strong rise in basic foodstuffs prices and the 
rise in the cost of oil).  He noted that since its l ast review in 2001, Mauritius had reacted vigorously to 
the change in the global economic environment a nd had undertaken major and ambitious reforms. The 
various measures taken showed clearly that the Maur itian authorities were determ ined to take up these 
challenges and to maintain a high degree of openness. These measures would release the economy 
from its dependence on trade preferences putting it on a better growth path. They would also set up an 
environment which promoted investments in Mauritiu s' main sectors, and would diversify its trade 
and economic relations by strengt hening its ties with existing pa rtners, and would improve the 
institutional framework for businesses by concluding new partnerships. 
54. The reforms undertaken by Mauritius had begun to bear fruit with a real GDP growth of 
5.1%, which was achieved in 2003.  The manufacturi ng sector had returned to growth with 4% in 
2006-07. The budget deficit went down to 4.3% in 2 006-07 and should be maintained at some 3.8% 
for  2007-08. The per capita GDP was some US$5,807 in 2007, as compared to US$3,788  in 2001.  In its World Report on Human Development for 2006,  the UNDP placed Mauritius at the top of the 
sub-Saharan African countries and 63
rd in the general classification. Mauritius' challenge was to 
continue these reforms, despite the difficult international situation. Nevertheless, as stressed by 
Mauritius itself, as a small food importing country, it  depended on external support to ensure that it 
could improve its competitive position and take up th e challenges of globalization. The concerns of 
Mauritius had to be taken into account in the current negotiations in order to enable it to continue to 
progress towards development.  
55. The representative of China  noted that Mauritius had e xperienced a continued annual 
economic growth of 5.1% since 2003. He welcomed  the outward-looking orientation of Mauritius’ 
trade regime and the bold reforms in its trade lib eralization process, with its simple average MFN 
applied tariff reduced from 19.9% in 2001 to 6.6% in 2007. This regime helped explain Mauritius' 
good economic performance during the period under review  and the high ratio of trade in goods and 
services to its GDP.  In recent years, China and Mauritius had enjoyed a sound and mutually-
beneficial economic and trade relati onship, and had become important trading partners to each other. 
Furthermore, China and Mauritius had developed both extensive and intens ive cooperation in the 
fields of direct investment, engineering technolog y and contracting services. By the end of 2007, 36 
Chinese companies had directly invested and mo re than two dozens of companies had provided 
contracting services in Mauritius. A newly approved industrial park in Mauritius, in which China’s 
Tianli group had invested, was expected to acco mmodate high-end, value-added industries and 
provide numerous opportunities of employment for the Mauritian population.  Mauritius was  WT/TPR/M/198 
 Page 17 
 
 
 commended for its active and constructive role in the multilateral trading system;  since the launching 
of the Doha Round negotiations, it ha d been acting as a strong defender of the interests of developing 
countries, including those of the SVEs. Mauritius would continue to play this important role in the 
multilateral trading system, and China would conti nue to work closely with Mauritius, and other 
Members of the organization, to bring the Development Round negotiations to a successful 
conclusion. 
56. The representative of the Separate Customs Territory of Taiwan, Kinmen, Penghu and Matsu 
(Chinese Taipei)  noted that since its last Review in 2001, Mauritius had made considerable progress 
in liberalizing its trade and investment regime.  The ambitious economic reform programme since 
2005, aimed at moving the economy from preference dependence to global competitiveness, was highly commendable.  Despite having had to bear severe repercussions from international trade policy 
changes in the textile and sugar sectors, the erosio n of preferences resulting from continuous trade 
liberalization, and steeply increasing food and oil prices, Mauritius’ economic growth remained 
strong.  Average GDP growth since 2003 had been  around 5.1% per annum, seemingly driven mainly 
by strong growth in the services s ector and the recovery of the textile industry.  In terms of trade 
policy, being a small economy, Mauritius was comm itted to building the multilateral trading system 
for the sake of the economic development of the entire Membership.  In the Doha Round 
Negotiations, Mauritius dedicated itself to advocati ng a trade solution to mitigate the problems of 
preference-dependent countries, as well as advancing the WTO Work Programme on Small Economies and the Aid for Trade initiative.  In Agriculture, Mauritius and Chinese Taipei, like the 
other members of the G-10, were net-food importers and shared the view that a "one-size-fits-all" 
solution would not forge a consensus, and the concer ns and interests of all Members, especially those 
that were weak and vulnerable, had to be accomm odated in the final modalities for there to be a 
successful outcome.  
57. Mauritius had reduced its tariff rates significantl y, aiming at transforming itself into a duty-
free island. Its simple average MF N tariff had been reduced from 19.9% in 2001 to 6.6% in 2007, and 
the number of duty-free lines increased to some 79% of all tariff lines.  However, Mauritius had only 
bound 15.7% of all its tariff lines, and put 15% VAT on all products.  As for Services, this sector 
grew to constitute some 67% of Mauritius’ GDP in  2007;  Mauritius had unde rtaken reforms in the 
finance, transport and telecommunication sectors, wh ich had the desired effect of giving these sectors 
a boost. In general, Mauritius’ applied services re gime was more liberal than its commitments under 
the GATS.  By further enhancing its multilate ral commitments, Mauritius would increase the 
predictability of its trade regime and make itself an even more attractive investment destination.  A 
successful outcome to the Doha Round would pa ve the way for a continuing strong economic 
performance by Mauritius in the coming years.  In this context, the represen tative of Chinese Taipei 
expected the Doha Round to lead Mauritius to si gnificantly increase the binding of its industrial 
tariffs, to narrow the gaps between applied and bound tariffs so as to create a more predictable trading 
environment, and to modify the binding of its GA TS commitments to better reflect its current more 
liberal regimes.  He encouraged Mauritius to reduce its internal indirect taxes; VAT and excise tax.  
58. The representative of Côte d'Ivoire
 noted the extensive efforts made by the Mauritian 
authorities who had undertaken considerable ins titutional, administrative and economic reforms in 
order to leave behind its dependence on preferences.   As a signatory to the Marrakech Agreement on 
15 April 1994, Mauritius was an active member of the African Group in trade negotiations for the 
conclusion of the Doha Round.  He appreciated that  Mauritius remained determined to become fully 
integrated in the multilateral trading system and had undertaken a policy to liberalize its economy. 
The country focused its efforts on the promotion and di versification of its foreign trading partners and 
created a modern institutional framework.  It had en couraged the private sector and had worked with 
regional and international organizations.  Nevert heless, in leaving behind these preferences, 
Mauritius, just as the majority of the ACP c ountries, was facing challenges such as ensuring a 
macroeconomic balance and adapting to the rules a nd mechanisms of the multilateral trading system.  WT/TPR/M/198 
Page 18  
 
Increased and sustained assistance from its economic  partners and interna tional institutions was 
required for Mauritius to succeed its policy of sustai nable development.  Tunisia, on behalf of the 
African Group, urged the WTO and the partner count ries to provide Mauritius with the appropriate 
technical assistance in order to make it possible for Mauritius to fully integrate into the multilateral 
trading system and to take advantage of it. 
59. The representative of Jamaica
 congratulated Mauritius for its economic performance, 
particularly against the background of external s hocks. Average annual growth rates of 3.3% since 
2001, efforts to contain inflation, and the implementa tion of policies were indications of the tenacity 
of Mauritius in trying to revive economic growth  through its economic refo rm programme. She noted 
that the growth of the economy continued to be ge nerated by the services sector which was a major 
contributor to GDP growth.  The four main pilla rs of the Mauritian economy were within three 
sectors:  services sector (tourism, financial services, emerging ICT sectors);  the manufacturing sector (textiles and clothing);  and the agricultural sector (sugar).  Mauritius had embarked on an ambitious 
and focused economic reform programme aimed at reducing the country's dependence on preferences 
to enhance its global competitiveness. The trend to ward market liberalization and the consequent 
erosion of preferences had profound effects on Ma uritius' economy.  Ways had to be found to re-
orient its economy to make it more responsive to the changing multilateral trading system.  At the 
multilateral level, Mauritius had participated actively in the negotiations with a view to advancing the 
views and positions of developing countries within different configurations, such as the ACP and 
African Groups, and small vulnerable economies. Maur itius had participated in a number of regional 
arrangements, such as COMESA, AGOA, SADC and the Indian Ocean Commission and was building 
and strengthening its bilateral ties with a number of countries.  Mauritius was also involved in the 
negotiations on EPAs with the EU and with the Members of the Eastern and Southern African 
configuration. Participation in regional trading arrangements was a response to the changing global 
environment in terms of market divers ification, and building competitiveness. 
60. The representative of Madagascar
 noted that her country enjoyed excellent relations and 
cooperated with Mauritius both at a bilateral level and within the framework of regional 
organizations.  The four main pillars of the economy  of Mauritius were the sugar industry, textiles and 
clothing industry, tourism, and financial services.  The economic regime had been confronted with 
challenges resulting from the increasingly demanding of the external economic environment.  Despite these obstacles, particularly the dismantling of the mu ltifibre agreement, the erosion of preferences, 
and climatic problems, Mauritius had continued to make treme ndous efforts to take up these 
challenges.  Mauritius had invested in an am bitious programme of economic reforms since 2005 
which aimed at the modernization of traditional sectors, diversification of the economy and supporting the emerging sectors in order to enco urage a services based economy.  Madagascar 
welcomed the bold initiatives of Mauritius and asked the International Community to assist it in 
achieving its development objectives. The economic de velopment of Mauritius was in the interest of 
both countries and would contribute to the devel opment of the sub region of the Indian Ocean.  
61. The representative of Nigeria
 noted that sound macroeconomic  policies and diversification 
programmes embarked upon by the Government had contributed significantly to sustained strong 
economic performance of Mauritius.  The country’s  economic regime had been challenged by a 
"triple shock".  Mauritius, in swift response, undert ook bold reforms aimed at liberalizing its trade 
regime. He observed that the reforms had started yiel ding dividends with real GDP growth at 5.1% on 
average (per year) since 2003, up from an average of 2.2% in 2001 and 2002. The services sector, 
dominated by tourism and financial services, constitu ted the backbone of the economy. However, the 
situation of Mauritius was more complex as a result of  the vulnerability associated with its situation as 
a small island developing country, as well as the more demanding external economic environment. 
Mauritius, as a Net-Food Importing Developing Country, had been affected by the recent price surge 
in basic food commodities, which constrained f ood sourcing capacity and policy options. The period 
2001-07 had been marked by intense international tr ade policy changes with strong repercussions on 
its economy. The termination of the Multi-Fibre Arra ngement and the agricultural reforms in Europe  WT/TPR/M/198 
 Page 19 
 
 
 had indirectly and severely affected the export inter ests of Mauritius in textile and sugar. The erosion 
of trade preferences, which always played a criti cal role in the development of Mauritius, had 
profound impacts on the socio-economic structur e of Mauritius. These trends required painful 
adjustments.  In spite of these challenges, Mauritiu s had resisted the temptation of policy reversals 
and maintained a high degree of openness.  Ma uritius had remained undaunted and had been 
participating effectively in the multilateral tradi ng system and playing active roles in its various 
groupings. 
62. Steps had been taken to boost competition, dismantle the dualism in the economy and 
improve resource allocation.  These reforms needed  to be amplified through the extension and 
improvement of Mauritius’ binding commitments on both goods and services.  The economic 
development prospects of Mauritius would depend on  its ability to adjust to the changing economic 
environment, through modernization, technol ogical innovation and economic diversification. 
However, without secure and enhanced preferential a ccess to markets, assistan ce to meet adjustment 
costs and to improve competitiveness, it would be difficult for Mauritius to meet the challenges of 
globalization. Therefore, Nigeria urged Developmen t Partners and the International Community to 
assist Mauritius, as a matter of priority, in bu ilding competitiveness and promoting adjustment and 
export diversification of products in the face of MFN tariff reductions. Adequate assistance and 
support should be provided to overcome these cha llenges. Support from the international community 
was vital for its economy reform programme to be sustainable. 
63. The representative of India  appreciated the very active ro le played in the WTO by the 
Mauritius delegation in Geneva in projecting th e views and concerns of developing countries, 
including work relating to small economies and the Aid for Trade initiative. Despite its smallness, and 
resource constraints, Mauritius had made treme ndous efforts in implementing the Uruguay Round 
Agreements. Mauritius was currently implementing an  ambitious reform programme aimed at moving 
the economy away from dependence on trade preferences to global competitiveness. He congratulated Mauritius on undertaking bold reforms aimed at li beralizing its trade regime, thus dismantling 
dualism and boosting competitiveness. The average real  GDP growth had been above 5% since 2003. 
Sound macroeconomic policies contributed in containi ng inflation, but the continuing high oil prices 
were of late nudging it upwards. Mauritius had also  been successful in diversifying its economy away 
from the reliance on sugar and textiles. The econom y seemed to be driven by the services sector, 
dominated by tourism and financial services.  Mauritius,  besides having historic links with India, was 
an important trading partner in the sub-Saharan Afri can region. In 2007, India had become the largest 
source of Mauritian imports, accounting for nearly 21%  of the Mauritian imports ;  India’s exports to 
Mauritius had increased from MUR4.6 billion in 2 001 to MUR25.6 billion.  The major share of 
India’s exports were petroleum products, inputs for the textiles industries, pharmaceuticals, and food 
products. There was scope for diversification of  the export basket from India to Mauritius.  
64. The Mauritian authorities were looking to di versify the economy from dependence on sugar 
and textile exports to a centre for Informa tion and Communications Technology. These areas 
presented an opportunity for Indian entrepreneurs to  establish themselves in Mauritius, in particular, 
in knowledge-based sectors.  India looked forward to further strengthening economic and commercial 
links with Mauritius, and hoped that the ongoi ng negotiations of the Comprehensive Economic 
Cooperation and Partnership Agre ement between India and Mauritiu s would be concluded soon.  
Trade policy in Mauritius was an integral part of the economic policies aimed at improving the 
standard of living of its people through the estab lishment of a thriving, competitive and modern 
economy, growing at high rates. The Human Deve lopment Report of 2006, had ranked Mauritius the 
highest among sub-Saharan countries. The develo pment prospects of Mauritius would depend on 
trade opportunities, and on how the WTO would a ddress its concerns. India hoped that with the 
support of the international community and as a result of the initiatives being taken by Mauritius 
itself, they would be able to k eep pace with the developments in the international trade and gain WT/TPR/M/198 
Page 20  
 
meaningfully from its integration into the global economy to ensure prosperity and higher living 
standards for its people.   
65. The representative of Barbados
 noted that as a small, vulnerable economy and ACP member 
State, her country shared many of the preoccupa tions and challenges facing Mauritius towards the full 
and beneficial integration into the multilateral trading system.  Intense and dynamic changes had 
taken place within the international trading environm ent, including the erosion of trade preferences in 
key sectors and rising fuel and commodity prices.  Mauritius had demonstrated resilience in implementing its existing WTO obligations and ha d contributed actively to the on-going process of 
liberalization in the Doha Round.  It had undert aken bold and forward looking economic reforms that 
sought to transform it into a globally competitive economy.  This platform, which was under 
development, was further bolstered with enhanced ma rket diversification efforts, particularly through 
South-South trade.  Barbados was seeking to expand  and consolidate its solid bilateral relations with 
Mauritius through trading and business opportunities, w ith one such tangible manifestation in the 
form of a double taxation agreement signed in 2004.  Mauritius and Barbados had had a particularly 
strong partnership in the multilateral arena specifica lly on SIDS issues within the United Nations, and 
on SVEs issues within the WTO.  Trade liberaliz ation would not be enough to allow Mauritius' 
economy to take full advantage of the market ac cess opportunities intended through the Doha Round;  
the Aid for Trade initiative was one of the mechan isms which could provide assistance to do this. 
Mauritius played an active role in the Aid for Tr ade Task Force on behalf of the ACP group.  The 
deliberate mix of policy measures and strategies whic h Mauritius had put in place to respond to global 
structural change, underscored the idea that a "one si ze fits all approach" would not be able to address 
the needs of all developing countries.  Particul arly for the small and vulnerable economies, the 
support of the international community would be cr itical to promote their sustainable development 
and avoid their marginalisation. As Mauritius conti nued to reposition itself to try to secure benefits 
from the international trading system, Barbados hoped that the conditions contributing to this 
delegation's participati on were duly considered. 
66. The representative of Senegal
 congratulated Mauritius which was an example for many 
developing countries, in particular for African count ries. He noted that the first reason for Senegal's 
support to Mauritius was sentimental, thanks to a longstanding relationship established over history, 
despite the geographical distance between both coun tries. The second reason was objective and linked 
to the good political and economic governance of Ma uritius.  Indeed, without having had natural 
resources of any real magnitude, Mauritius had en joyed an unprecedented economic success, thanks 
to good economic and political practices. Mauritius had demonstrated to the A frican continent that 
development was the result of a serious attitude and good governance. Mauritius was one of the 
African countries which had become fully and well in tegrated into the international trading system 
and had drown benefits fro m non-reciprocal preferences. It had ensured that its textile sector was able 
to take advantage of this, despite the very serious difficulties encountered in that area in the majority 
of African countries. Moreover, Mauritius was deve loping the ICT area. There was no doubt that with 
some support and assistance from the WTO, and th e International Community, Mauritius would be 
able to meet this new challenge with success.  
67. The representative of the Democratic Republic of Congo  noted that Mauritius, as a net food 
importing developing country, had been hit by the rise in the price of basic foodstuffs which had serious repercussions on its socio-economic structure,  forcing it to make painful adjustments in order 
to remain dynamic. He appreciated that Maur itius had started an ambitious economic reform 
programme which intended to free it from its dependence on preferences.  By setting up a structured dialogue between the Government and the privat e sector, Mauritius was ensuring that the private 
sector also intervened in trade negotiations, mu ltilaterally, regionally and bilaterally.  Developed 
countries, as well as international and cooperation agencies, were asked to give support to these 
reforms which were part of lightening the burden of debt that Mauritius faced at all levels. The 
contribution made by Mauritius to the Doha Rou nd development negotiations in the African Group 
and the group of ACP countries had been very important.    WT/TPR/M/198 
 Page 21 
 
 
 68. The representative of Korea  noted that bilateral trade betw een her country and Mauritius had 
grown steadily, reaching about US$40 million in 2007. There was greater potential for further economic cooperation between the two countries and fo r further development of their bilateral trade 
relations. Korea welcomed the conclusion of the b ilateral investment treaty between the two countries 
in 2007. Through the signing of a bilateral treaty, bi lateral investment relations would increase in the 
years to come. Efforts had been made by Mauritius to improve its investment regime and it had a 
strong economy. Mauritius had pursued efforts rega rding active trade liberalization, and it was 
encouraged to further accelerate its trade and economic reform agenda. Korea echoed other delegations in encouraging Mauritius to increase it s binding coverage, while readjusting the gap 
between the applied and bound rate. 
69. The representative of Oman
 congratulated Mauritius for its ec onomic reforms that resulted in 
an average GDP growth of 5.1%. Oman and Mauritius were members of the Indian Ocean 
Association for Regional Coopera tion and she hoped that the econom ic cooperation between the two 
countries would be further strengthened through this regional economic forum. WT/TPR/M/198 
Page 22  
 
V. REPLIES BY THE REPRESENTATIVE OF MAURITIUS AND ADDITIONAL 
COMMENTS 
70. The representative of Mauritius
 indicated that his country's small size, remote location and 
narrow resource-base posed tremendous  challenges to their policy-make rs.  Despite these constraints, 
Mauritius had embarked upon an ambitious ec onomic reform programme.  Mauritius had 
demonstrated how it was endeavouring to move towa rds more open, transparent and rule-based trade 
policies, which were in line with objectives of th e WTO.  However, for the success of the reform 
programme, Mauritius needed support from cooperating partners and donor co untries to complement 
the resource gaps. 
(i) Economic Environment 
71. Several Members had appreciated the Economic  Reform programme undertaken by Mauritius 
and wished to obtain further details on concrete actions and measures taken to achieve the goals of 
employment creation and promotion of social equity.  One of the main objectives of the economic reform programme had been to broa den the circle of opportunities of each Mauritian citizen.  In this 
respect, the Government of Mauritius had initiate d the Empowerment Programme.  This programme 
would cost Rs 5 billion over five years to unlock opportunities (i) for the unemployed, (ii) for those 
who needed to be recycled, (iii) for women, (iv) for young people entering th e labour force and (v) for 
small and medium entrepreneurs.  In addition, th e new Integrated Resort Scheme (IRS) which aimed 
at development of high-value residential property, made provisions for a corporate social plan where each IRS promoter had a corporate social responsibility  to provide support to local fishermen, planters 
and micro enterprises.  With regard to the financ ing of the reform programme, it was expected that 
half of the financing would be met from FDI and external assistance.  However, being a middle-
income country, Mauritius did not have any easy acc ess to Official Development Assistance (ODA) 
and concessionary financing.  Aid for Trade would, th erefore, be a key factor for the future of its 
reform programme. 
72. Like other open economies, Mauritius was vulnerabl e to external shocks.  It was facing high 
inflation mainly due to the steep rise in worl d food prices caused mainly by high demand, adverse 
climatic conditions, and soaring oil prices.  The upward movement in the prices of these two commodities was having a cascading effect on other commodities as well.  Monetary policy was being tightened.  However, monetary policy was not sufficient to combat inflation.  In order to 
mitigate the effect of rising food prices in the future, Mauritius had to come forward with a food policy programme which would help achieve food security. 
73. Increasing food prices was a world wide problem, but for Mauritius, a Net Food Importing 
Developing Country, the problem was even more acute.  There was no easy and immediate response to this global food crisis.  With a view to re ducing dependency on food imports, a series of measures 
had been initiated with a view to enhancing self-s ufficiency, with particular emphasis on potatoes, 
onions, tomatoes, maize, milk, meat and fish produc ts;  seizing all opportunities on the regional front 
for food production;  developing Mauritius in to an agro-business hub through Cross Border 
Initiatives;  developing a modern agricultural sec tor and a fisheries sector in line with the 
sophistication taking place in other sectors of th e Mauritian economy;  empowering economically and 
technically the agricultural community, especially  the younger skilled generation by giving them 
opportunities and appropriate trai ning and support to enable th em to emerge as agricultural 
entrepreneurs;  improving access to agricultural in put requirements (such as planting materials), 
irrigation facilities and land;  and encouraging artisan al fishermen to fish off-lagoon and entrepreneurs 
to invest in the fisheries and a quaculture sector.  The labour law reform in Mauritius was aimed at 
achieving the flexibility needed for creating demand fo r labour, together with the security, needed to 
protect the worker.  In this respect, the labour le gislation had been reviewed in consultation with 
stakeholders, including trade unions, employers,  and the International Labour Organisation.  WT/TPR/M/198 
 Page 23 
 
 
 74. The overlapping membership of Mauritius in COMESA and SADC was a continent-wide 
issue and the solution had to em anate from a continental initiative under the African Union.  The 
Abuja Treaty had outlined the road map to continen tal integration through th e institution of Regional 
Economic Communities as building blocks, and the ultimate objective of the AU was to move towards a continental Common Market.  This warrant ed the different regional blocks to imperatively 
harmonize and synchronize their policies in terms of  Customs Unions, in particular the Common 
External Tariff.  In this respect, it had been al ready agreed that COMESA, SADC and East African 
Community (EAC) would hold a joint meeting in October 2008 in order to address the issue of overlapping membership and the Common External tariff. 
75. Mauritius had embarked on a massive tariff reduction programme since 2005, but it was not 
yet a duty free island.  Moreover, the regional inte gration agenda of COMESA was wider than just 
trade in goods.  For example, regional integrati on under COMESA had included trade in services, a 
common investment area, harmonization of sanitary and phytosanitary measur es, and trade facilitation 
amongst others. At least for the medium term, there had been no contradiction between the future plan 
of Mauritius to become a duty free island and its re gional integration agenda.  As far as the COMESA 
Customs Union per se was concerned there was a lot of outstanding work prior to its launch. 
Negotiations were ongoing for the list of sensitive products for which member States would require a 
longer period of adjustment to the Common External Tariff.  A Ministerial Task Force had approved a 
standstill clause which would allow member States to  maintain duty rates which are below the CET 
Rates. It had also been agreed that member states not participating in the Customs Union should 
maintain all benefits of the Free Trade Area. 
76. With regard to the suggestion to diversify Ma uritius' international trade and to consider 
joining the GSTP, Mauritius had, over the last d ecade, significantly diversified its sources of supply 
as well as its export market and was pursuing further on this path.  It was also exploring the possibility of taking advantage of the GSTP. 
77. The Financial Services Commission of Mauritius had adopted a new conceptual approach to 
Global Business with the enactment of the Financ ial Services Act in 2007. The new approach had 
stressed the fact that although global business ac tivity was conducted essentially outside Mauritius, 
substantive business activity was being controlle d and managed from Mauritius. The Financial 
Services Act did not provide for an exhaustive list of activities.  This had given a more flexible 
approach to global business to cater for the new and ever-changing fi nancial products on the 
international market, provided that these activities we re not unlawful and contrary to public interest, 
or which may cause prejudice to the good repute of Ma uritius as a centre for financial services.  This 
was a standard clause for jurisdiction dealing with international services.  In determining whether the 
applicant qualified for a global business licence, th e Financial Services Commission considered all 
circumstances of each application in particular th e Ultimate Purpose Test.  The above provisions were 
supplemented by further rules and circulars whic h the Commission issued from time to time and 
which should be read along with the whole regulatory framework.  
78. The trade relationship between Mauritius and the EU had, for more than 30 years, been 
governed by non-reciprocal arrangements.  Howeve r, the unilateral and non-reciprocal preferences 
under these agreements had been deemed not to be  compatible with the provisions set out under 
Article XXIV of the GATT and were, therefore, covered by a WTO Waiver.  Both the EU and the ACP countries, including Mauritius, had undertaken  to conclude new WTO compatible trading 
arrangements by 31 December 2007, which were expect ed to provide for a predictable, transparent 
and legally secured framework for trade between the EU and the ACP countries.  Negotiations for the 
EPA were difficult and protracted. Given the pace of negotiations and the impossibility to conclude a 
full Agreement by the deadline of 31 December 2007, it had been agreed that regions would conclude 
an Interim Agreement, pending the conclusion of a full EPA in 2008.  Mauritius, which was not a 
beneficiary of the Everything But Arms (EBA) in itiative, could not opt for the GSP Scheme, which WT/TPR/M/198 
Page 24  
 
was less preferential than the Cotonou Agreement and had stringent rules of origin provisions.  In the 
Interim Agreement, the EU provided duty free a nd quota free market access as from 1 January 2008 
for all products, except for rice and sugar, which would have a transitional period up to 2015.  
Compared to the previous ACP-EU agreements, th e EPA expanded the scope of product coverage and 
would, therefore, provide additional market access  for a number of products such as dairy products, 
poultry and wheat flour and other prod ucts considered sensitive.  Moreover, their Rules of Origin in 
the Interim Agreement were more favourable and flexible than those of the Cotonou Agreement.   
79. The Interim Agreement also contained a detailed and elaborate chapter on fisheries which 
aimed at optimizing the benefits from fisheries through investment, capacity building and improved 
market access as well as conservation and management of fisheries resources.  Development was at 
the core of EPA negotiations and the Interim Agr eement provided for a comprehensive and ambitious 
development package.  ACP countries were expect ing to receive Euros 23 billion for development 
assistance over the next seven years under the Europ ean Development Fund (EDF).  Moreover, the 
EU had agreed to contribute to the financing of projects identified in a development matrix.  For its 
part, Mauritius would liberalize 95.6% by value of its imports from the EU according to an agreed 
time frame.  It was expected that the full EPA w ould be concluded by December 2008 to replace the 
Interim Agreement, including trade in services, trad e related issues, including investment and trade 
facilitation.  Negotiations in those outstanding ar eas were expected to be challenging. Many ESA 
countries had made relatively few commitments in th e multilateral fora in trade in services. Mauritius 
had not been engaged in negotiations  with any other country on such trade related issues. Negotiations 
on these issues remained a challenge since the objec tive set was for the EPA to fully support the 
reform programme in Mauritius as well as  its economic development targets.  
(ii) Trade Policies 
80. In 2007, WTO had been notified of subsidies in  respect of two Freeport Incentive Schemes, 
namely Corporate tax exemption and Customs duty and excise duty concession on machinery and 
equipment.  Legislative changes had been made to remove the corporate tax exemption for the 
Freeport as from 1 July 2009. As for the customs and excise duty concession on machinery and 
equipment, at present, tariffs on virtually all im ported industrial machinery and equipment were zero 
rated.   
81. In the 2005 budget, the 80% customs duty had been eliminated on clothing in one single 
effort.  This had had a number of repercussions on the local manufacturers.  Following representations 
made by the private sector, Government had intr oduced specific duties on clothing as a temporary 
measure. 
82. The duty-free island concept was an objectiv e which government aimed to achieve.  
However, sequencing of the specific tariff cut w ould depend on the restructuring of the specific 
industries which were likely to be affected.  
83. The new Central Procurement Board (CPB) ha d been operational since 18 January 2008. 
There had been a smooth transition from the old system to the new CPB.  Since its operation, the 
Board had received 50 tenders and there had been no delay in their processing, as approvals had been 
given within the respective bid validity period. Th e status of Mauritius as observer to the Plurilateral 
Agreement on Government Procurem ent was under consideration.  The actual number of products 
being subjected to non-tariff barriers such as quantit ative restrictions, import controls and exclusive 
rights over imports were very limited and in most cases, the impact on trade was negligible.  
However, consideration was being given to review most of these measures. 
84. Although Mauritius had some weaknesses in a few op erations relating to the supply chain, the 
overall ranking came as a surprise to most provide rs and users of the port services in Mauritius.  
However, this ranking should not belittle the advances made by Ma uritius in the area of Trade  WT/TPR/M/198 
 Page 25 
 
 
 Facilitation.  In fact, in the same World Bank re port, Mauritius was ranked tenth out of 150 countries 
in the area of customs procedures where most trade facilitation measures were concentrated.  
(iii) Sectoral Policies 
85. Several delegations enquired whether Mauritius would increase the coverage of its tariff 
bindings for industrial products and whether the gap between the applied tariffs and the bound rates 
could be reduced.  This depende d on the overall outcome of the D oha Round negotiations and the 
benefits that Mauritius was likely to derive from it.   In the ongoing Non Agricultural Market Access 
(NAMA) negotiations, Mauritius, as a "paragraph 6" country, would abide by its obligations resulting 
from the outcome of these negotiations, including a substantial increase of its binding coverage. 
86. Despite Mauritius' limitations as a small devel oping island, it had made considerable efforts 
in adding two new sectors (accountancy services and co mputer-related services), in its initial GATS 
offer.  However, Mauritius had noted that the overa ll response and the quality of offers made by other 
WTO Members did not respond to its expectations a nd development aspirations.  Mauritius wished to 
receive clear and unequivocal assurances on the exte nt to which it would be rewarded for its 
autonomous liberalization measures in trade in services. 
87. Participation in the complex area of negotia tions in maritime transport services was very 
much limited due to capacity constraints.  However,  as a first step towards contributing to enhancing 
greater openness in the maritime transport services, Ma uritius expressed keen interest in participating 
in the initial debate pertaining to liberalization of logistics services. 
88. The implementation of the Multi-Annual Adaptation Strategy (2006-15) in the context of the 
sugar sector reform started in 2007. It was a ten-year reform programme and it would be premature at 
this juncture to identify any significant results. 
89. The fisheries sector had been identified as one  of the emerging pillars of the Mauritian 
economy.  It was fitting with Mauritius' objectiv e of diversifying its economic base, building 
resilience and achieving food security.  To develop th e fisheries sector, due attention was being paid 
to the sustainability and management of aquatic re sources. Mauritius had an exclusive economic zone 
of 1.9 million km2 and its potential had not been fully exploite d.  Concerted efforts had been made to 
develop a sea food hub in Mauritius.  The underlying  strategy was the development of value added 
fisheries and seafood related sectors. These had include d fishing, aqua culture, transhipment, storage 
and warehousing, light processing (sorting, grading,  cleaning, filleting and preparation of loins), 
canning and ancillary services (such as ship chande lling, bunkering, vessel hus bandry, ship agency, 
ship building and repair).  The Sea Food Hub had required investment in state-of-the-art 
infrastructure, including dedicated quays, co ld room facilities, processing facilities and the 
development of ancillary industries.  As a result, there had been substantial employment creation and 
both exports and re-exports of fish  and fish products had increased.  To-date a One Stop Shop service 
was in place in the free port area to facilitate the administrative procedures for loading and unloading 
exports of fish and fish products.   
90. Mauritius recently submitted its notification on Agriculture to the WTO Secretariat for 
calendar year 2007. Mauritius had endeavoured to  live up to its commitment of submitting its 
notifications on a regular basis. 
91. The discussant  noted that delegations raised a wide range of topics with the main point of 
discussion being the broad recognition of the external  difficulties that Mauritius had faced in recent 
years and the appreciation of the bold reform programme that it had put in place. Mauritius should be 
seen as a model, as a country demonstrating qualities that could serve as an example to others. The 
keen interest in the areas where Mauritius was seen as particularly  strong indicated that other WT/TPR/M/198 
Page 26  
 
members wished to learn from the Mauritian experi ence. The discussant hoped that the review had 
also given the Mauritian delegation some food for t hought of potential challenges and some ideas that 
it could take home and reflect on.   
92. The representative of the United States
 congratulated Mauritius on the significant progress it 
made in its trade policy regime. The announcement made by Mauritius regarding the notification on 
agriculture and the commitment to continue to make notifications was appreciated.  She urged 
Mauritius to modify its WTO services commitments.  Better commitments in many services sectors, 
especially in manufacturing services, could serve inv estment and enhance pred ictability. Finally, as 
Mauritius worked to diversify its economy, the United States looked forward to working with 
Mauritius through AGOA, the WTO and other fora. 
93. The representative of the European Communities  congratulated Mauritius on the considerable 
economic growth and major reform efforts it had made during the last few years and encouraged it to 
continue with the economic reform programme. She wished it success in converging its trade policies 
towards a duty-free island and towards deeper regi onal integration at the same time.  The EC was 
looking forward to participating in the TPR special session organized with the support of AITIC 
focusing on the economic reforms a nd trade-related technical assistance needs of Mauritius. The EC 
had been supporting economic reforms in Mauritius, and would continue to do so, as the EC was 
looking forward to learning more about trade-re lated technical assistance experiences of Mauritius 
and its further needs. 
94. The representative of Ecuador  expressed his appreciation for the commitments taken by 
Mauritius in its efforts to improve the economic situation. 
95. The representative of Mauritius  believed that the review enabled the Mauritians to know the 
world's view on what Mauritius had put in place. It  was even more important to hear about what 
Mauritius could do and some actions that it needed  to take. Regarding the comment made by the 
United States, the representative indicated that he  was going to Washington for the TIFA council 
meeting, so it was an on-going exercise. And w ith regard to the comment made by the EC, the 
representative explained that the EC and Mauritius were very old partners and friends, and were 
involved in very active discussion on the EPA which Mauritius hoped to  conclude in 2008.  WT/TPR/M/198 
 Page 27 
 
 
 VI. CONCLUDING REMARKS BY THE CHAIRPERSON 
96. This third Trade Policy Review of Mauritius h as given us an opportunity to considerably 
improve our understanding of its tr ade and related policies, and thei r evolution since its previous 
Review in 2001.  Our discussions have greatly be nefited from the participation of Mr. Anand Priya 
Neewoor, Secretary for Foreign Affairs, and his delegation.  I would also like to thank our discussant, 
Mr. Henning Stir ǿ, for his thought-provoking contribution, and delegations for their thoughtful 
interventions. 
97. Members commended Mauritius on its reforms that have, since 2003, resulted in the recovery 
of its economy.  Mauritius has taken steps to libera lize trade by significantly increasing the number of 
duty-free import items, and therefore reducing the simple  average tariff.  It has also eliminated the 
discrimination in the implementation of tariffs an d other duties based on the sources of imports.  
Customs procedures have been simplified through th e introduction of a channel system in 2003.  In 
addition, Mauritius has reformed its investment regi me by eliminating most of its incentive schemes 
and moving toward a more general regime, based on low taxes and promotion of targeted projects.  
Referring to Mauritius' plans to become a duty-fre e island, Members sought information about the 
way this would be reconciled with its participation in regional agre ements aiming at customs unions. 
98. Members encouraged Mauritius to further improve  the transparency of its trade regime by 
making key notifications, notably in agriculture.  The regime would also gain in predictability if the 
scope of tariff binding were extended, the gaps  between applied and bound rates reduced, and the 
existing services commitments enhanced to make them better reflect the actual more liberal services sector.  Elimination of non-tariff barriers would impr ove the transparency of Mauritius' trade regime.  
Members urged Mauritius to bring other duties on t ea imports to their bound level.  Mauritius was 
also encouraged to accelerate the legislative pr ocess, notably in the ar eas of competition and 
intellectual property rights, and to become an observer to the Plurilateral Agreement on Public 
Procurement. 
99. Clarification was sought on the investment regime  for foreigners in tourism services.  Other 
issues of interest to Members included government  intervention in the economy;  increasing use of 
specific tariffs;  policy and perspectives for the textile and apparel industry;  legislation on 
professional services;  energy;  and Aid for Trade needs. 
100. Members appreciated the responses provided by the delegation of Mauritius. 
101. In conclusion, Members were appreciative of  Mauritius' trade reforms and of its active 
participation in the multilateral trading system.  Th ey urged Mauritius to pursu e its reforms and take 
further steps to enhance the predictability of its  trade regime, mainly through the extension and 
improvement of its multilateral binding commitment s on goods and services.  Members could help 
Mauritius in its adjustment efforts,  including the dismantling of its capacity constraints, by providing 
assistance through the Aid for Trade framework, a concept Mauritius actively helped to develop. 
 
__________