Mauritius is a good base to expand into Africa, says Orama CEO Keseena Chengadu
Within Africa, there are many individuals who have primarily associated Mauritius with a holiday destination, unaware of the abundant business opportunities it offers as a reputable International Financial Centre, says Órama CEO Keseena Chengadu. Accompanied by a dynamic team of talented and visionary young Africans, Chengadu has grown Órama into a powerful corporate engine in facilitating access to Mauritius, Africa’s financial hub and friendliest business destination.
“Mauritius plays a crucial role in facilitating significant capital inflows into mainland Africa that would otherwise be challenging or even impossible. This contribution alone has resulted in the creation of approximately 4.2 million jobs across the continent,” Chengadu tells PAV magazine.
As a sign of its growing clout Keseena Chengadu and her team have been actively present in diverse business themed events across the continent, and recently opened a new office in South Africa.
With a rising energetic populace comprising mostly youth, rising middle and upper class with economic and purchasing power, new discoveries and exploration within the energy sector, advancement in technology and innovation, awakening conscience of the African people, increased pragmatic leaders, AFCTA agenda 2063, and continuous push for the reunification of the continent, immigration reforms and the abundance of resources in Africa opportunities, are bound, prospects are good and Africa still holds the torch as being the future, says Keseena Chengadu.
May we start with an appraisal of how things have stood with Orama since the year started, how has business been for you?
Keseena Chengadu:It’s been absolutely great compared to last year, although a company of modest size, our strategies have elevated us to become a force to recon within a short span. Our brand has become firmly established, and our clients express great satisfaction with the services and solutions we offer. Our proactive marketing campaigns have generated a significant increase in inquiries. Our team is growing as anticipated, fueled by innovative ideas, unwavering dedication, and a genuine passion for our mission. The evolving needs of our clients and the current business climate have compelled us to seize the opportunity to expand into South Africa sooner than anticipated.
Within Africa, there are many individuals who have primarily associated Mauritius with a holiday destination, unaware of the abundant business opportunities it offers as a reputable International Financial Centre. The recent grey listing of certain countries in Africa has further prompted investors to explore alternative jurisdictions like Mauritius.
Overall, we are delighted with the current progress and remain committed to driving forward towards the end of the year. Our focus is on delivering sustainable growth solutions that cater to our clients' businesses.
Mauritius plays a crucial role in facilitating significant capital inflows into mainland Africa that would otherwise be challenging or even impossible, says Keseena Chengadu
Your primary focus remains Mauritius as a business destination, what are some of the reasons that make that country stand out from other African countries as a business destination?
Keseena Chengadu: Mauritius is a tiny island nation but extremely powerful in supporting the whole of the African continent in several ways. Aside from being the most peaceful with great economic and political stability, it is also the number one country in Africa with the ease of doing business according to the world bank report.
As per the World Economic Forum, Mauritius has facilitated the inflow of nearly $80 billion into mainland Africa, thanks to its robust compliance and regulatory framework. Additionally, its strong banking sector and well-developed infrastructure have fostered seamless capital flow, supported by the absence of exchange control policies.
It is also important to note that is has a very simple, low and attractive tax system favorable to all business while it presents modern cutting edge innovative financial vehicles completive to several developed nations that equips businesses to take advantage of to attract capital, have a smooth operation, expand exponentially across the world while growing sustainably. Good governance and leadership cannot be overemphasized with government even more committed to ensuring investor protections and policies to thrive businesses, Mauritius is an example of success in Africa. Additionally, it is the only country that special treaties with several countries including the only one in Africa to sign such bilateral treaties with India and China aside the several existing DTTA with other nations that allows businesses in Mauritius to preferential access to 70% of the world market.
How can the potential that Mauritius has and the work you do be of benefit to other countries of the continent?
Keseena Chengadu: Mauritius plays a crucial role in facilitating significant capital inflows into mainland Africa that would otherwise be challenging or even impossible. This contribution alone has resulted in the creation of approximately 4.2 million jobs across the continent.
Granted investments into Africa are channeled through Mauritius, if Mauritius were not there, some of those investments would have either not been done or would have gone through competing jurisdictions such as Dubai, Luxembourg, UK, Singapore and the Netherlands. Interestingly majority of these countries who are benefiting from these mediations do not even have bilateral relations with Mauritius.
Furthermore, there are countries currently on the financial watchlist (FATF's grey list), and this situation has a profound impact on business owners in Africa. In this regard, Mauritius serves as an alternative solution for these entrepreneurs to restore and optimize their business operations. This is especially significant as Mauritius has been recognized and included in the EU and OECD's whitelist, providing a reliable platform for conducting business.
It is good to note that the bilateral agreements such as the that Mauritius has with its counterpart parties does not only serve as a framework for the avoidance of double taxation on income earned by individuals and businesses in both countries but it also aims to promote bilateral trade, investment, and economic activity through effective tax planning and certainty of tax treatment with a leverage of strengthening economic cooperation between the two countries by preventing tax evasion, providing tax relief and exemptions, promoting investment and trade and resolving tax disputes. Without a doubt, Mauritius reaps the rewards of offshore activities, as do the destination countries in various aspects. These include foreign direct investments, private equity and portfolio investments, infrastructure development, enhanced productive capacity, job creation, technology transfer, skill development, and downstream tax revenues.
It is important to note that despite the existence of Double Taxation Avoidance Agreements (DTAA), businesses investing in Africa diligently fulfill their tax obligations in the respective jurisdictions where they have subsidiaries or permanent establishments. Therefore, our clients responsibly fulfill their tax obligations in the appropriate jurisdictions while simultaneously benefiting from the tax advantages that Mauritius offers. Furthermore, in the event that dividends are declared, under a DTAA, companies pay taxes based on the lower of the tax rate in the respective country or the rate specified in the tax treaty. Additionally, these companies are eligible for a tax credit in Mauritius for the taxes they have already paid in the country where the investment is made (investee country). This mechanism ensures that companies are not subjected to double taxation and allows them to benefit from the provisions outlined in the tax treaty.
As a sign of its growing clout, Keseena Chengadu and her team have been actively present in diverse events across the continent, and recently opened a new office in South Africa
Can you shed light on the office that Orama recently opened in South Africa?
Keseena Chengadu: South Africa and Mauritius go way back sharing a very special relationship.Both countries support each other, and evidence of their strong relationship is backed by their bilateral treaty in form of the Double taxation agreement which further strengthens the economic cooperation between the two countries.
Given the current challenges faced by South Africa, including energy deficits, being grey listed, and the potential threat of sanctions from other global powers, it is evident that these circumstances have caused unease among investors. However, these challenges also present an opportunity for us to position Mauritius as a viable alternative investment jurisdiction for investors seeking a secure and stable environment. Understanding that in the end it’s not about competition but rather solutions and conducive environment for investors business to thrive is what is important as we work toward creating a better and thriving African continent.
South Africa is a huge market with several potentials, and we understand the terrain and market as well as the cultural and political dynamics and business climate very well as we have been servicing clients amongst others. South Africa also has one of the busiest and developed international airports (O.R Tambo International airport) with great connectivity and serves as a major transit point for most of our clients who are traveling to various jurisdictions and that enables clients connecting flights to easily and quickly stop over at our office to discuss business.
The expansion will bring substantial advantages to our clients, encompassing enhanced services and convenience. With Sandton serving as a prominent hub for international business in Africa, the establishment of a new office strengthens our local presence and deepens our relationship with domestic clients. This presents an excellent opportunity for clients to engage directly with our professionals, fostering face-to-face communication instead of relying solely on online or mail correspondence. As a result, clients will enjoy a more personalized experience, allowing Órama to tailor its services more effectively to meet their individual needs.
Moreover, the expansion into South Africa brings forth a myriad of fresh prospects for our clients, granting them access to promising new markets. As Mauritius has long served as the gateway to Africa, our physical presence on the ground ensures that clients seeking to expand their operations in South Africa can rely on us for invaluable firsthand experience and insights into the regulatory frameworks in place.
A company managed in a country renowned for its strong economic standing, venturing into another thriving territory, immediately garners enhanced credibility within those markets. This expanded presence empowers clients with a wider reach and has the potential to bolster their future growth trajectories, opening doors to increased opportunities and prosperity.
Furthermore, this allows Órama access to a larger pool of talents, which can lead to the incorporation of newer technologies and more experienced staff. Since Sandton is a hotspot for African trades and industries, the new office will allow the company to recruit diverse talents with extensive experience with knowledge of the African markets. This, in turn, is expected to lead to the development of new cutting-edge technologies and innovative solutions beneficial to our clients.
Our office is also strategically located in the prime area in the heart of Sandton with close proximity to the Gautrain station, the Radisson Blu Gautrain Hotel and the Nelson Mandela Square which is amongst the safest areas and easily accessible to our clients and employees.
How does the opening of this office fit in the broader vision that Orama has for the rest of the continent and any plans to open more offices?
Keseena Chengadu: It’s the concept of playing a supportive role where one falls short. It’s an African progressive agenda, where Mauritius maximizes its strength as a team player and allows an avenue for businesses to utilize its strategic resources and vehicles where the continent is not equipped, ultimately ensuring continues business progress, sustainability and growth in the African businesses community when it comes to operations.
Órama has a vision of how businesses should grow in the 21st century, and shares the belief that people, entrepreneurs and corporations are the tools the world needs to build true sustainability. We provide entrepreneurs, companies and investors with the opportunities to thrive and shape a prosperous future.
Presently, South Africa encounters challenges such as energy deficits, being grey listed, and the potential threat of sanctions from other global powers. It is important to note that Nigeria is currently also grey listed, and the implications have a wider impact on the entire continent when viewed from a broader perspective.
Investors are seeking solutions to navigate these obstacles, and Órama serves as a valuable cushion by utilizing the opportunities presented by Mauritius to alleviate the evident concerns among investors. It is undoubtedly an opportune moment for us to offer these solutions, and we take great pride in promoting Mauritius as Africa's own International Financial Centre, providing African solutions tailored to the needs of investors.
Besides the financial sector, what other areas should interested investors be on the lookout for in Mauritius and Africa?
Keseena Chengadu: Real Estate: The real estate sector in Mauritius and Africa offers significant potential for investment, particularly in commercial, residential, and hospitality developments. With growing urbanization and increasing demand for quality infrastructure, real estate projects present lucrative opportunities.
Energy: Energy development in Africa extends beyond renewable sources to include the significant role of oil and gas. Africa boasts substantial oil and gas reserves, making it an important player in the global energy market. Investors interested in the energy sector can explore opportunities in oil and gas exploration, production, refining, and distribution across various African countries, including Mauritius. Oil and gas projects contribute significantly to the economic growth and development of African nations. They provide job opportunities, stimulate local industries, and generate revenue through exports. Additionally, the development of the oil and gas sector often leads to infrastructure improvements, such as pipelines, refineries, and storage facilities, which benefit both the energy industry and the broader economy. While Africa embraces the expansion of renewable energy projects to address energy deficits and promote sustainability, the oil and gas sector remains crucial due to its significant energy demand and existing infrastructure. It is important to strike a balance between transitioning to cleaner energy sources and leveraging the potential of oil and gas resources to meet the continent's energy needs and drive economic development.
Blue Economy: Given Africa's extensive coastlines and rich marine resources, the blue economy presents immense potential. Investments in sectors such as fisheries, aquaculture, maritime transport, tourism, and marine biotechnology can contribute to economic development while preserving ocean ecosystems.
Information and Communication Technology (ICT): Africa's ICT sector is growing rapidly, driven by increased internet penetration, mobile technology adoption, and a thriving digital ecosystem. Opportunities exist in areas such as telecommunications, e-commerce, fintech, software development, and digital services, with Mauritius serving as a regional technology hub.
These sectors demonstrate the diverse investment opportunities available beyond the financial sector in Mauritius and throughout Africa. It is important for interested investors to conduct thorough market research, engage with local stakeholders, and leverage the support provided by investment promotion agencies to identify specific opportunities aligned with their investment goals.
There are many who still have a skewed vision on the investment climate in Africa, using your experience and leadership in Mauritius, what are some of the reassuring realities you want to share with potential investors?
Keseena Chengadu: Africa's economic growth is set to outpace global forecast in 2023-2024 – according to African Development Bank biannual report. Africa is set to outperform the rest of the world in economic growth over the next two years, with real gross domestic product (GDP) averaging around 4% in 2023 and 2024. Rising energetic populace comprising mostly youth, rising middle and upper class with economic and purchasing power, new discoveries and exploration within the energy sector, advancement in technology and innovation, awakening conscience of the African people, increased pragmatic leaders, AFCTA agenda 2063, and continuous push for the reunification of the continent, immigration reforms and the abundance of resources in Africa- I think Africa still holds the torch as being the future. The prospects are very bright, opportunities abound.
In terms of challenges, what are some of the typical ones that you face?
Keseena Chengadu: It is crucial to address and reshape the prevailing narrative among some individuals in Africa today. Regrettably, there remains a lack of belief in their own capabilities and systems, coupled with a deficiency in support for their own continent.
Despite the competence and reputation of Mauritius as an International Financial Centre (IFC), some individuals still harbor doubts and believe that it cannot match up to other competing jurisdictions. Consequently, they opt for utilizing other jurisdictions while neglecting the opportunities available within their own continent.
However, it is important to highlight that the records and history of Mauritius speak for themselves, gaining recognition not only on a global scale but also from esteemed organizations such as the World Bank and the European Union. These endorsements affirm the competency and credibility of Mauritius as a reliable and trustworthy IFC.
The time has come to challenge this mindset and instill a sense of pride and confidence in African capacities and systems. By embracing the potential within their own continent, individuals can contribute to its growth and development, leveraging the remarkable achievements and standards set by Mauritius as an example.
Órama works closely with investors within the energy sector in Africa to ensure smooth and tax efficient operations of energy investors in Africa using Mauritius as a reputable hub.
In terms of recommendations that could make the investment climate across Africa even better, what are some of the suggestions you have for African leaders?
Keseena Chengadu: "Mr. Gorbachev, tear down this wall!" in the voice of United States President Ronald Reagan in West Berlin speech on June 12, 1987. African leaders must move fast to unite the continent economically and do so fast by opening borders to their own people and remove, or at the very least minimize, visa restrictions, especially for high-income earners, entrepreneurs, and business leaders within Africa. This step is crucial for fostering infrastructural development and promoting increased trade among African nations, among other benefits. African leaders must recognize that the collective representation of Africa to the world as one voice is key and advantageous rather than individualism. Policies initiated must be considered by the people of Africa.
We have seen Orama working in partnership with African themed energy events hosted by the African Energy Chamber, how is this in line with your vision and will you be part of the African Energy Week 2023?
Keseena Chengadu: Órama works closely with investors within the energy sector in Africa and our role is to ensure smooth and tax efficient operations of energy investors in Africa using Mauritius as a reputable international finical center with robust regulatory policies and world class investor protection schemes as well as a conducive environment for doing business, ensuring they have solid grounds for sustainable growth and expansion as they tackle energy deficits challenges on the continent.
Mauritius has no foreign exchange control policies despite it being the most compliant country in Africa coupled with a robust banking system and financial vehicles and instruments and business support systems which enable the free flow of capital and investments into their respective operational jurisdictions thereby giving them the peace of mind to function properly.
The African energy week conference is by far the largest energy event on the continent. With more than 4200 total attendance, 47 participating Ministries 36 Government delegations, including foreign governments, international organisations, including participations from OPEC, IEA, The World Bank, GECF, IEF, European Investment Bank, Hydrogen Europe and World Nuclear Association, 23 African NOCs. It creates a perfect ground and opportunity for networking and sponsorship while we use the opportunity to enlighten prospects and clients about the opportunities that Mauritius presents for business growth.
