Mauritius is fast emerging as a major international financial centre in the Indian Ocean and Africa region. Chief executive officer of Standard Chartered Bank Mauritius, Sridhar Nagarajan explains why improved banking regulations can sustain long-term growth in the sector.
What are some of the banking regulations that attract bankers to Mauritius?
Mauritius has a diversified economy and is keen to be further recognised as an international financial centre of substance. For this reason, it is fast emerging as the Singapore of Africa. A number of initiatives have been implemented over the years to improve on the jurisdiction, particularly with respect to the financial services sector. For instance, the recent measure to allow global companies doing business in Mauritius to also operate on the local market indeed allows more entities to have a more substantial local presence. There are now more value added activities being carried out in the country, for example, the managers of a number of funds domiciled here have local offices and personnel who actively manage the funds. Mauritius has signed a number of Memorandums of Understanding (MOUs) with leading international financial centres and regulators with respect to exchange of information. Our observation is that there is commitment to comply with the Organisation for Economic Co-operation and Development (OECD) norms and to cooperate with other governments and authorities in order to ensure effective exchange of information. Such collaborations help to protect foreign investors and depositors and promote the integrity of the financial services markets in both jurisdictions. Mauritius has received favourable reviews from the OECD Peer Review Group on its framework of exchange of information and its effectiveness. To date, there has not been a single request to investigate any alleged round tripping in Mauritius.
Money laundering is a hot topic lately with many financial institutions alleged to encourage the practice. Is this a problem in Mauritius?
International banks such as Standard Chartered, HSBC, Barclays and Deutsche Bank have stringent Anti-Money Laundering (AML) regulations embedded in their frameworks of doing business. As the representative of the International Banks in the Mauritius Banking Association, I can say that the country has one of the most stringent AML guidelines and strict adherence is a constant focus of the Bank of Mauritius. Towards this objective, a number of legislative frameworks have been introduced, namely the Financial Intelligence and Anti-Money Laundering Act 2002 (FIAMLA 2002), the Prevention of Corruption Act 2002 (POCA 2002) and the Prevention of Terrorism Act 2002 (POTA 2002). Mauritius is also among the first few countries to be classified as a ‘white listed’ jurisdiction in 2009.
Interview courtesy of the Board of Investment - Mauritius