SOLID MAURITIUS-CHINA TIES
The 15th day of April 2022 marked the 50th anniversary of the establishment of diplomatic relations between Mauritius and China. To mark this historic occasion, a series of activities was planned by various organisations.
The Mauritius-China ties are special in the sense that Mauritius enjoys a certain unique position insofar as China and its foreign relations are concerned. Despite having a small minority population of Chinese origin, Mauritius has officially declared the Chinese New Year as an official public holiday. It is worth highlighting that the first China Cultural Centre in the world officially opened in Mauritius on 11 July, 1988. Furthermore, the People’s Republic of China picked Mauritius as the first African country to enter into a Free Trade Agreement (FTA) which became effective as of the 1st of January 2021.
MAURITIUS AS THE PREFERRED TRADE AND INVESTMENT HUB IN AFRICA
Mauritius is acutely aware of the limitations of the capacity of its domestic market and must deftly deal the Africa card to transcend the limitations imposed by its minuscule size. However, throughout its history, its geostrategic location has made it a fertile terrain for rivalry among incumbent and nascent superpowers such as China. Shining through its good governance, social stability and favorable business climate, Mauritius is well-positioned to be the preferred Trade and Investment Hub in Africa, for Africa and by Africa.
In order to enhance the bilateral ties and provide long-term visibility on the Sino-Mauritian relations, Chinese Ambassador Mr ZHU Liying proposed for both sides to cogitate and come up with a roadmap.
To the keen and discerning observer, Côte d’Or would have certainly stood out on the radar since it is fast becoming the epicenter of public infrastructure development. After the Côte d’Or Multisports Complex was completed in time for the Indian Ocean Games 2019 thanks to the assistance of the Chinese government, the Mauritian government plans to make Côte d’Or a showcase of what best Mauritius can offer.
Thus, a Technology Park is planned at Côte d’Or with some companies already moving in. A new international racecourse project appears to be back on track after some false starts. The area will be served by the Metro Express with imported labour toiling day and night to connect the segment from Rose Hill to the University of Mauritius/ Ebène CyberCity, which will eventually be extended to Côte d’Or and Centre de Flacq.
In the past during the height of the pandemic, both the Mauritian and Chinese sides have expressed interest in partnering to develop a biotech/pharma project at the Côte d’Or Technology Park. The production will be mostly geared towards the African market after meeting the rather small demand from the Mauritian market. Today, the production of COVID vaccine may no longer be a pressing urgency but production of other therapeutic products still has a market in Africa.
On 6 July 2022, at a gala dinner organised by the Chinese Speaking Union, during his keynote address, PM Pravind Jugnauth reiterated that Chinese hitech firms are most welcome at the Côte d’Or technology park.
EAST MEETS WEST WITH FTA AND RMB
At the 8th Forum On China-Africa Cooperation (FOCAC8) in November 2021, President XI Jinping announced the setting up of a Cross-Border Renminbi (RMB) Centre in Africa. On the 24th November 2021, during a webinar jointly organised by the Economic Development Board and the Embassy of Mauritius, the CEO of the Bank of China in Mauritius Mr LI Lianhong announced that his institution has been designated as the Clearing and Settlement Agency for the RMB. Then on 7 June 2022, during the National Budget 2022-2023 Speech, Mr Renganaden PADAYACHY, the Minister of Finance, Economic Planning and Development, confirmed the setting up of the RMB Clearing Centre.
The RMB Hub has the potential to streamline cross-border payments and reduce costs of international transactions.It is worth noting that the China-Africa trade exceeded USD 250 billion in 2021 despite COVID-19. On the other hand, the trade relation of China with the US and EU has gone south with both the USA and EU qualifying China as a “strategic competitor” and “systemic rival” respectively that needs to be contained. The China-Africa trade volume is thus experiencing robust growth and appears set for a bright future.
With RMB Clearing Centre in sight and the Mauritius-China Free Trade Agreement (MCFTA) in hand, Mauritius has a strong suit in hand to boost trade between China and Africa, if it plays its cards right.
INVESTING IN AFRICA FORUM
The Investing in Africa Forum (IAF) is flagship event to foster high-quality partnerships between China and Africa while respecting global best practices as promoted by international organisations. The forum is jointly organised by the World Bank, the Ministry of Finance of the People’s Republic of China and also involves a host African country.
The IAF is an annual event and the venue alternates between Africa and China. The 1st edition took place in Ethiopia in 2015 and then China hosted the 2nd edition in 2016. The last edition which was the 5th took place in the Republic of Congo back in 2019 and the conference has been on hold since the onset of the COVID-19 pandemic.
To consolidate the position of Mauritius as the preferred International Financial Centre (IFC) in Africa and the Gateway between Africa and Asia, Mauritius would do well to host a future edition of this important investment forum targeting Africa.
In the same line of thought, Mauritius would benefit greatly were it to play host to a future edition of the FOCAC Summit. Such event is usually attended by Heads of States or Governments from all over Africa and, of course, China.
GEOPOLITICS OF BRI
During FOCAC8 meeting held in Senegal in 2021, all African countries with diplomatic ties with China were invited. In the end, a total of 53 countries out of the 55 that make up the African Union (AU) were present at the conference. Eswatini was blacklisted as it maintains diplomatic ties with Taiwan. Western Sahara is recognized by the African Union but not yet so by the United Nations and China.
Obviously, these two countries have not signed the Belt and Road Initiative (BRI) MOU with China but there are a few other exceptions, notably, Mauritius which has yet to jump onto the BRI bandwagon. Notably, India has also shunned the BRI by officially expressing concern about the China-Pakistan Economic Corridor (CPEC) — one of the geostrategic corridors in BRI — passing through the disputed territory of Jammu and Kashmir. Given the “super special ties” between India and Mauritius, Mauritius has so far stayed out of the BRI.
Recently, the Ukraine crisis has forced a rejig of New World Order. India did not appreciate to be arm-twisted to adhere to the Western coalition against Russia and when forced to pick a side, Indian External Affairs Minister Subrahmanyam Jaishankar wisely and justifiably expressed that “if India need to pick a side, it will be India’s side”. In other words, India is adopting a so-called ‘issues-based strategic posture.’ Interestingly, this realignment has brought the two neighbourly giants back to the negotiating table with a palpable thaw in the previously ice-cold relation.
Although it might be too early to declare that the ‘Hindi-Chini Bhai-Bhai’ good vibes are back, we can nevertheless anticipate a ‘New Era in China-India ties.’ Subsequently and consequently, we can predict perhaps a shift in the posture of ‘Chota Bharat’ as the Elephant and the Dragon cozy up to each other.
That would represent a major shift in foreign policy of the two Asian behemoths with the cooperation predominating over competition. Whilst initially perceived as competing programs, BRI and SAGAR could potentially undergo a certain degree of strategic alignment. In an almost uncanny fairy-tale scenario, the Belt and Road Initiative could actually lead to Security and Growth for All in the Region.