Check Against Delivery

TRADE POLICY REVIEW OF MAURITIUS

Statement by Ambassador Peter F. Allgeier
U.S. Permanent Representative to the WTO

Geneva,
April 23, 2008

Thank you, Chair.

The United States welcomes the delegation from Port Louis for the third WTO trade policy review of Mauritius. We thank Mr. Anand Priya Neewoor, Secretary for Foreign Affairs, for his comprehensive statement and for the informative written reports that his government and the WTO Secretariat prepared for this review.  Thanks, as well to Mr. Henning Stirø of Norway for his meaningful contributions as discussant.

The United States and Mauritius enjoy a constructive bilateral relationship in which trade and investment play a major role.  Our governments consult bilaterally under the Trade and Investment Framework Agreement (TIFA) that we signed in 2006.  The TIFA has provided opportunities for us to explore common objectives on a regular basis, including our participation and cooperation in the WTO.

Mauritius benefits from the U.S. African Growth and Opportunity Act (AGOA).  In 2007, the value of U.S. imports from Mauritius under AGOA and our Generalized System of Preferences (GSP) programs was $120 million, representing 64 percent of U.S. total imports from Mauritius.  While much of this trade was concentrated in the apparel sector, we note significant diversification forces at work, particularly in the diamond, seafood processing, eyewear, and jewelry sectors.  The United States is pleased that AGOA has sparked substantial investment in Mauritius.

The government of Mauritius has come to recognize that preference programs, while helpful, cannot be the ultimate response to the fundamental challenges of economic growth and development.  To its credit, the government has begun to tackle the complexities of economic reform, becoming a positive African model of how market-opening strategies can fuel development and spur economic diversification.  In July 2006, the government of Mauritius embarked on a bold economic reform program that aims to move the nation away from reliance on trade preferences and toward greater global competitiveness.

We note that Mauritius maintains a market-based economy with a strong, dynamic private sector, elements that have proved time and again to hold the key to economic prosperity.  Already considered an upper-middle-income country, Mauritius’s GDP per capita has grown from almost $3800 in 2001 to about $5800 in 2007.  In the World Bank’s Doing Business 2008 report, Mauritius ranks 27 out of 178 countries on the ease of doing business, the highest among African countries.

The Mauritius government and Secretariat reports convey the nation’s aim to become a duty-free island.  The government has reduced its top import duty from 65 percent to 30 percent and increased the number of duty-free lines to some 79% of the total.  The Secretariat observes that this has helped reduce the simple average MFN tariff from 19.9% in 2001 to 6.6% in 2007.  We urge Mauritius to increase the number of its bound tariff lines and to lower the ceiling rates.  Additionally, we agree with the Secretariat that Mauritius’s trade regime would benefit from reducing the gap between applied and bound duty rates.  We commend Mauritius for eliminating the differences between the excise duty rates on imports and local goods, and for applying the VAT to both imports and domestically-produced goods.  Also, we welcome the government’s trade facilitation efforts, including its steps to accelerate customs clearance

Adequate and effective protection of intellectual property rights continues to be a major U.S. concern.  Accordingly, we are pleased that Mauritius has enacted a number of new laws since its last TPR regarding patents, industrial designs and trade marks in an effort to conform to the WTO TRIPS Agreement.  Mauritius has also established enforcement regulations.  The Judiciary can now require infringers to pay compensatory damages to intellectual property holders for the injury suffered.  We would like to know more about the Police Department’s new Anti-Piracy Unit and the Unit’s activities.

According to the Secretariat, Mauritius maintains non-tariff barriers on numerous products in the form of quantitative restrictions, import permits or bans.  Furthermore, the State intervenes in activities through several parastatal bodies which market or supply products or services.  While we acknowledge Mauritius’s attention to its WTO notification obligations, we understand that there are outstanding notifications requiring government action, including those under the Agreement on Agriculture. 

In its report, the government states that overhauling its incentive framework is the centerpiece of its efforts to improve trade competitiveness.  In October 2007, the United States joined other WTO Members in granting a second and final extension of time, until 2015, for Mauritius to eliminate its export subsidies under the Freeport Scheme duty and excise tax concessions and corporate tax exemptions.  What steps has Mauritius taken to advise beneficiaries that these export subsidies will be terminated and what steps is Mauritius taking to phase-out these programs?

The services sector is the largest contributor to Mauritius's GDP.  In general, Mauritius's applied services regime is more liberal than its GATS commitments.  We agree with the Secretariat that by modifying its existing services commitments to reflect its more liberal applied regime, Mauritius would benefit from attracting new investment, especially in key areas of infrastructure.

Mauritius has actively engaged in the Doha Development Round and we appreciate the government’s contributions to the negotiations.  We urge Mauritius to consider the additional global market opportunities that will arise from a meaningful Doha Development Round outcome.

In sum, the United States commends Mauritius’s trade policy reforms.  Backed by structural reform and macroeconomic stabilization, continued trade and investment policy reforms will allow Mauritius to compete for the new opportunities that will result from successful Doha Development Round negotiations.  The United States appreciates the opportunity to participate in this review of Mauritius’s trade policy, and we look forward to continuing our dialogue and cooperation in the coming days.

 

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