Mauritius and China have signed the first Sino-African Free Trade Agreement, opening the African island nation to new trade opportunities with the globe’s second-largest economy.
The deal, which was made official on Friday, coincides with the signing of the African Continental Free Trade Agreement (AfCFTA) which went into effect on the first day of 2021.
The China-Mauritius free trade deal will mean that Mauritius’ 8 500 exported products to China will be duty-free within seven years. Around 88% of the tariff lines on duties would be eliminated immediately, with the remainder whittled away incrementally, according to the Mauritian Foreign Ministry.
The landmark deal includes the removal of trade restrictions in more than 100 critical sectors, including health services, construction, IT, telecommunications, and financial services.
Director-general of Africa Affairs at China’s foreign ministry, Wu Peng, said the deal strengthens and vitalises Sino-African ties. He said Beijing was looking forward to working with more African governments on similar arrangements.
Gyude Moore, former Liberian minister and current senior fellow at the Centre for Global Development, said the free-trade agreement is a model that could be replicated across the continent.
Mauritius has several double taxation agreements, a stable government, and has been intentionally diversifying its economy while expanding its tax base, making it an attractive location for Chinese manufacturers, according to Moore.
Moore highlighted the importance of the deal in terms of Mauritius’ sugar exports. Nearly 85% of the island nation’s agriculture industry is dedicated to the crop which accounts for 6% of the country’s GDP, according to a 2018 report by the Mauritius Sugarcane Industry Research Institute.
China agreed to grant Mauritius a tariff-free quota for 50 000 tons of the commodity over eight years.
Other notable Mauritian export items set to benefit from the agreement are rum, fish, noodles, pasta, fresh fruit and fruit juices, mineral water, linen, watches, and leather goods.
The China-Mauritius trade deal was signed the same day the AfCFTA went into effect. The new trading bloc encompasses 1.3 billion consumers and has an estimated value of $3.4 trillion, according to The South China Morning Post.
After years of planning, every African nation signed the agreement except Eritrea, which opted out of the continental pact.
In November, Chinese Foreign Minister, Wang Yi, said AfCFTA would be warmly received by Beijing and that the government would “provide cash assistance and capacity-building training to its secretariat”.
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