WTO TRADE POLICY REVIEW OF MAURITIUS
Statement by U.S. Ambassador Linnet Deily
November 2, 2001

Opening Remarks:

Thank you Mr. Chairman. The United States welcomes the delegation from Port Louis
for the second WTO trade policy review of Mauritius. We commend the Secretariat for its report on the trade policy regime of Mauritius. We also appreciate the Government's report. These reports and the entire TPR process can be useful, not only in understanding and improving trade policy formulation but also in furthering coordination of trade-related activities throughout the Government. We have produced a series of questions stemming from these reports. We look forward to receiving answers and learning more about the trade policies and practices of Mauritius.

The U.S. and Mauritius enjoy a friendly bilateral relationship. Trade is a major part of that relationship. The United States and Mauritius enjoy growing, and important, commercial relations. United States imports from Mauritius were $285 million in 2000. More than 200 U.S. companies are represented in Mauritius and about 35 have offices in Mauritius, serving the domestic and/or the regional market. Several U.S.-affiliated companies use bilingual Mauritius as a base to reach both English- and French-speaking markets in Africa. We share the interests of Mauritius as expressed in the Government report in consolidating our trade relations, especially in the context of the Africa Growth and Opportunity Act.

We are committed to encouraging the continuing development of Mauritius through increased trade. This is demonstrated by the eligibility of Mauritius as a beneficiary country under the African Growth and Opportunity Act (AGOA). It allows Mauritius to export a wider range of duty-free products to the United States, already its principal export market. AGOA expands market access, thereby assisting Mauritius in its efforts to diversify its exports. Clothing exports to the U.S. market are expected to go up by 30% in 2001, thanks mainly to AGOA. In the medium term, AGOA is expected to bring vertical integration in the local textile industry (with a couple of yarn spinning factories in the pipeline) and regional integration with other sub-Saharan countries' textile sectors.

The Mauritian economy is among the strongest in sub-Saharan Africa, with a GDP of $4.6 billion and per capita income close to $3,900 in 2000. Mauritius was deemed the most competitive economy in Africa by the World Economic Forum in 1998 and 2000.

Mr. Chairman, the United States and Mauritius share a commitment to the objectives of the WTO. The U.S. recognizes that Mauritius's policy formulation is aimed at participating actively in the work of the WTO and that free trade influences trade policy formulation in the goods and services sector. We commend Mauritius for setting up a WTO Standing Co-ordination Committee to deal with the implementation, follow-up and coordination of trade policy issues that fall under the WTO agreements.

For many developing countries implementation of the WTO Customs Valuation Agreement is a concrete step towards meaningful customs reform. We are pleased therefore that Mauritius converted to the transaction valuation of imports in accordance with the Agreement as of January 1, 2000. We also understand that implementation of the Trade Net Customs Clearance System allows electronic pre-submission of documents and seems to have diminished customs clearance times. We are also pleased that Mauritius has participated in both the WTO Financial Services Agreement and Information Technology Agreement.

We understand that Mauritius is finalizing new legislation on patents and trade marks, and drafting legislation on industrial designs, geographical indications, and layout designs of integrated circuits with a view to complying with its obligations under the WTO Agreement on TRIPS. We encourage it to do so as soon as possible.

We understand that developing countries like Mauritius have special concerns, which is
why we are committed to providing technical assistance. Over the past three years the U.S. has committed more than $192 million in assistance in sub-Saharan Africa towards strengthening trade related capacity. Such assistance will help Mauritius and other African countries take advantage of open markets and the WTO system.

Mauritius has made considerable progress towards increasing growth and diversity but still has some economic problems. The Secretariat's Report notes that the prospect of economic growth in Mauritius will largely depend on adjustment measures that the Government will implement to take up the challenges faced by the economy. These challenges range from the scarcity of land, resources, skilled workers and the ageing of the population to challenges in the international environment.

The Secretariat's Report also notes Mauritius's economy has elements of duality: companies producing for the domestic market are fairly highly protected, while export enterprises are granted incentives under various schemes which has created tensions in resource allocation between the export and domestic sectors. The report notes that the simple average tariffs on manufactured goods is nearly 21 percent. The report also notes that Mauritius has bound duties only on 14.6 percent of its tariff lines. A lowering of tariffs and an increase in the coverage of bindings would enhance the openness and predictability of the Mauritius tariff regime. We also note that excise duties are significantly higher on imports than locally produced goods. We urge Mauritius to equalize these excise duties.

The Secretariat Report notes that the number of products subject to price control was increased in 2000. We would encourage the Government of Mauritius to consider reducing the number of products subject to price controls.

We understand that Mauritius is in the process of reviewing existing legislation on government procurement and proposed amendments with a view to ensuring conformity with international norms and practices. We would encourage Mauritius to consider becoming an observer or a member of the Government Procurement Agreement and supporting the proposed Agreement on Transparency in the Government Procurement.

We would also encourage Mauritius to reduce restrictions on foreign investment in the tourism sector and on foreign participation in tour operating and other services.

CONCLUSION

Mr. Chairman, Mauritius has made some substantial progress towards economic growth. GDP has increased and exports have become more diversified. We look forward to continuing to work with Mauritius both bilaterally and multilaterally to support them in their efforts. As part of this we look forward to the discussion in this review.