“East Africa is a natural neighbour to Mauritius in its broader economic journey”

The recent East Africa: Powering Africa’s Sustainable Growth conference, held at the Hennessy Park Hotel, in Ébène, brought together business leaders from Mauritius and East Africa to explore opportunities for investment and collaboration. In this exclusive interview with BIZWEEK, Jason Harel, Co-Founding Partner at BLC Robert & Associates, and Karim Anjarwalla, Senior Partner at ALN Kenya | Anjarwalla & Khanna, share their perspectives on how Mauritius can strengthen its connection with East African markets. The discussion focuses on the potential of East Africa, a region experiencing significant growth due to urbanization, infrastructure improvements, and economic diversification. Mauritius, with its expertise in sectors like agribusiness, finance, and tourism, has the opportunity to expand its influence in the region. However, challenges such as enhancing legal and regulatory frameworks, improving diplomatic relations, and fostering strategic business partnerships remain critical for success.

Can you elaborate on the role of BLC Robert and Associates? What role are you playing in connecting Mauritius with East African Markets, and how does this align with your mission and vision?

Jason Harel, Co-Founding Partner, BLC Robert & Associates: First, Mauritius acts as a gateway for investments into Africa, and these entities or businesses wishing to invest into Africa, including East Africa, need legal services. Whether it be private equity funds, international companies, development finance or financial institutions, they need legal services based in Mauritius. This money transitions from Mauritius for investments into Africa. Say the investment is in Kenya, we play a role as far as structuring this investment in Mauritius, and then that investment eventually finds itself, say, in Kenya, whereby Karim Anjarwalla, of ALN Kenya, looks after that investment. This is how we more often collaborate with one another. 

The second example is where Mauritian businesses are implementing themselves in East Africa and the rest of the continent, and they need legal services to be able to do this. This is where we collaborate. About 70% of our fee income is cross-border in nature, involving more than one country. This is how we help to connect Mauritius with East Africa.

The socio-economic advantage of East Africa has been highlighted during the BLC-ALN conference. What specific sector do you believe has the most potential for Mauritian investors, and how should they approach these opportunities?

Karim Anjarwalla, Senior Partner, ALN Kenya | Anjarwalla & Khanna – The first thing to remember is that the East African market provides a population of around 450 million people. Mauritius, obviously, is limited in the sense that it’s an island. It has a population of 1.2 million. So, if you want to access large markets for consumers, then Mauritius has no choice but to look outside Mauritius. So, I think that’s the starting point. Now, the question is where Mauritian businesses can have a competitive advantage. Agribusiness is obviously one. You are experts in, for example, sugar cane production, and most of our markets have big sugar deficits and need to produce more sugar. You can leverage your expertise at large scale in a facility such as that in many countries in East Africa. But beyond that, Mauritius has got a lot of capacity at the intellectual, technical and financial levels, and all these can be leveraged in a whole range of industries.

For example, in anything involving fast moving consumer goods, in the retail sector, in the banking or insurance sector, there’s a very large range of opportunities that are available to Mauritian businesses. 

You may be aware that the digitization of commerce in all its forms is very advanced in many parts of Africa, but especially in East Africa. In Kenya, there’s a discussion, for example, about the Silicon Savannah. We have a very large number of tech entrepreneurs, tech start-ups, fintech start-ups, data scientists and so on, and there’s an opportunity, I think, for Mauritian companies to get involved in that wave of digitization of commerce in all its forms. 

I don’t think we can forget to mention tourism. Obviously, if there was one area of competitive advantage beyond many others for Mauritius, it would be your operation of tourism facilities, especially beach facilities, but also the financing of them and access to your markets. East Africa presents a whole range of different types of tourism, hospitality and cultural experiences. I think the Mauritian operators are extremely well-placed to leverage their skills and get involved in a much bigger way in the hospitality space.

We’ve heard, for the last 20 years, about Africa being the Promised Land from an investment perspective, and also that Mauritius is the gateway to Africa. How far is this relevant at this point in time?

Jason Harel – I’ll start with ‘Mauritian being the gateway to Africa’. There is no doubt, at some point, that we had, and we still have, a very good position as an investment gateway into Africa, but obviously, this position is also under threat if we do not reinvent and better our services. For instance, we’ve heard from Stephen Jennings that with Special Economic Zones, we have competitors. We need to improve our services to achieve higher standards.

The judiciary has got to improve. We must have a good legal service being provided to international investors. We cannot wait, for instance, for an enforcement of a UK judgment to take five years in this country. These are the types of things which we really must improve upon. Justice delayed is justice denied.

We are dealing with international investors and they’re not going to put up with that, and they’re going to effectively go elsewhere. This is already happening. We must remedy this situation. We also have to remedy the situation at the FSC, which is not providing a service to the level which international investors would expect. All of this has got to be improved. We must better our international relations with African countries, sign double taxation agreements with, for instance, countries like Kenya, Tanzania… We must start moving again. These are things which have not been addressed in the last 10 years.

Karim Anjarwalla – Mauritius has positioned itself as a gateway to Africa as a whole, including East Africa, and that’s why BLC and us, through ALN, collaborate so often on all types of investments and structuring, and so on and so forth. But this is Mauritius as a gateway. What I mean is that this is not direct Mauritian investment into East Africa, but Mauritius as a financial centre. As Jason has said, Mauritius doesn’t operate in a vacuum. There are other competitors who position themselves for cost, efficiency, quality of personnel and quality of regulators. 

It’s incumbent on Mauritius to make itself the destination of choice. There’s work to be done to continue to sharpen the Mauritius selling point. When it comes to talking about direct Mauritian investment into East Africa, there’s obviously been very good examples of those investments in the recent past. The question is: why isn’t there more? One of the reasons is the absence of healthy engagement. I would, for example, very much encourage the Mauritian government to consider having a full diplomatic presence in East Africa, which I think is sorely lacking. When you have such a large market at your doorstep, I think having a diplomatic presence in our region would help to kick-start the political, as well as the commercial, engagement with our part of the world. 

We rarely have trade missions from our part of the world to Mauritius or vice versa. Yet, there’s an obvious synergy that we’ve discussed and that was evident at the meeting we just had yesterday (last Monday). There needs to be more of that. On the East African end, there needs to be a more welcoming and constructive engagement with Mauritius, and that’s something that we, at ALN, can help facilitate. 

The most important thing is that when you can have informed and intelligent conversations about risk and opportunity, then investors are more likely to engage. So then you’re not making decisions based on newspaper headlines, on what you’ve heard from 20 years ago, on what you’re hearing from social media, or from gut instinct, but on actual facts, figures, and knowledge on the ground, and this is why we’re bringing from East Africa Dr James Mwangi,  Group Managing Director & CEO, Equity Group Holdings, Stephen Jennings, Founder & CEO, Rendeavour, Gilead Terry, Executive Director, Tanzania Investment Centre, Ross Evans, CEO, Hemingways Hospitality Group, and Mita Vohra, Board Director and Head of Sales, Marketing, Revenue and Distribution, Sarova Hotels.

This is all there to showcase to Mauritius the investments available, but also who you will be engaging with, because that’s an important thing. Who are the players? Can you engage with them? Are they of like mind? It is obvious they are of like mind. These are serious people with whom you can do business, big players with whom Mauritians can easily engage. 

Now, the real question, I think, is what happened in Asia. Those who missed out on the Asian wave of the late 90s and early 2000s, that was a permanent miss. You can’t recover from that miss. There was a wave of growth, and that wave of growth, either you were part of that journey, or you missed that journey, and timing, in life, is everything. For Mauritian companies, it’s the same question, and the data doesn’t lie. The data on economic growth and so on and so forth doesn’t lie. The question is whether there is a strategic willingness and desire to engage. This conference was to try to ignite that engagement. 

Mauritius still has a very good position as an investment gateway into Africa, but this is also under threat if it does not reinvent itself and better its services

– Jason Harel, Co-Founding Partner, BLC Robert & Associates

What are the main takeaways from yesterday’s conference?

Jason Harel – Well, the main takeaways are the opportunities that lie in those markets. We have the necessary expertise to take advantage of some of these opportunities, especially in finance, hospitality… There is a sort of large complementarity in respect of hospitality. As I mentioned at the conference yesterday, for instance, some of the clients, say from the U.S., if they want to go on a safari, they can’t go on a safari in the Caribbean or in South America. The best safari is in Kenya and Tanzania. You are then able to market, get access to those types of clients, and bring them back to Mauritius as well. 

We heard from Mrs Mita Vohra in respect of China. They’ve got very good access to the Chinese market, which we don’t necessarily have. There are a lot of complementarities, which will also help develop our business further.

You spoke of the pertinence of “moving regional”. Can you tell us more about it? 

Jason Harel – We’re seeing that a lot of businesses, for instance in Morocco, in Nigeria, in Kenya itself, and in South Africa, are creating regional ecosystems. So, obviously, if you only stay national and fail to move into the regional ecosystem, you’re going to get eaten alive. The issue is that you need to go regional to get the necessary scale, because at the end of the day, you need the scale. If you do not, then you’re going to not only lose out on an opportunity, but that might cost you in terms of survival as well. I’ll give you an example. Think about these hotel operators who combined and have access to the Chinese market, to the U.S. market and so on and so forth. Whereas an operator which doesn’t do that, then what’s going to happen? The operator which doesn’t do it, obviously, is going to lose out. These strategic advancements must be considered.

Karim Anjarwalla – Two points I want to add to that. The first is if you just look at the geopolitics of the world today, it’s extremely complex. And all the old alliances are now beginning to break down. So, how you advance yourself in this new world order completely needs a rethink. All the old alliances and partnerships might not survive. If you’re in Europe today, you’re wondering very hard, for example, about your relationship with North America. Understanding the role of China and the Middle East in Africa is extremely important. 

I think that Mauritius needs a very big rethink on the nature of its strategic relationships, including with Africa. And I think, specifically with Africa, it needs to be working in obvious complementarity. Mauritius is part of COMESA. How much advantage does it take of that trading relationship that exists already? I think not much. Mauritius has this advantage of dual language. How much does it really take advantage of that in its export-led growth? Of course, you do it in your own island, but what about in Africa as a whole? I think not sufficiently. There are obvious strategic advantages that Mauritius has that it can capitalize on, especially in this new world order that we find ourselves in. 

The second point is – and Steven Jennings made this point yesterday – that the world grows in clusters. What you tend to find is regions growing together. If your neighbour grows, you’re more likely to grow because of trade flows and so on and so forth. Mauritius obviously doesn’t have a neighbour, in a sense. It’s an island. It however needs to think of itself. It needs to ask: who are our potential neighbours? With whom can we grow? The East African region, being the second fastest growing region in the world – not in Africa, but in the world – is a natural neighbour to Mauritius in its broader economic journey. But that needs a conscious effort. It won’t happen automatically. The idea of the conference was to demystify how to do business in East Africa, and allow Mauritian companies that are not in the market to emulate what other successful Mauritian companies have done to take a step. 

Do you think that having a single currency could help in doing business in Africa?

I think that we are a very long way away from monetary convergence. That remains what I would call a political project rather than an economic project. However, there is much more development by the Afreximbank, for example, in developing a single means of exchange using a financial product that they will devise. If you are an exporter in Kenya today, sending your goods to Mauritius, Egypt or the Ivory Coast, you have to go by the dollar or the euro, and that, of course, creates lots of tensions within our foreign exchange markets. The Afreximbank is now developing a medium of exchange that allows African countries to trade with each other without having to use the dollar or the euro.

This would be a massive step when it happens, because it will unlock trading and it will allow the movement of money much more easily, and it will also reduce exposure. So, rather than a single currency, I think it’s these trading mechanisms that will evolve. 

In the same vein as China having renminbi clearing houses…

That’s right. Exactly!

What is your message to investors? 

There are multiple opportunities in Africa. We have to look at these opportunities with an open mind, with a strategic mind. It’s important, as well, for the country as a whole to look at these opportunities.

Would it be correct to say that the time is now, and that if we miss this opportunity, it will be perhaps too late in respect of what’s already happening? We have seen, in the last month, many US companies moving with intent into East Africa. Chinese investment is also moving massively. So is the time now? 

Jason Harel – The time is definitely now, because we have already seen Moroccan businesses moving into East Africa. We have seen the Nigerians moving, the South Africans as well. If we wait too long, the opportunities will be gone. So that’s why we say now, because as Karim has said earlier in respect to Asia, that boat is gone completely. If you wait too long, obviously, it will be gone, and it will be beyond our means to pay for the type of prices which would be there in the future. Either we’re going in at the entry level and taking advantage of a rising tide, or when the tide is high, it will cost much more.

On the diplomatic front, the narrative is that you have the right to choose your partner.

But if you go for a partnership with China, for instance, you could get on the wrong side of some traditional partners. What’s your take on this? 

Karim Anjarwalla – You know, Jason is my good friend, but he can’t tell me who my other friend should be. I think a good friend is a friend who doesn’t dictate your other friendships. And I think that way of thinking needs a lot of strategic deftness to articulate your relationships with multiple parties. We’re in a multipolar world now. We know, in Africa, how dangerous it was in the 1960s, 70s, 80s, for you to become a client state of one country. That led nowhere for economic growth and development. It was a road to disaster. 

In this new age, we are back to a multipolar world. It’s imperative that Mauritius and other African countries have much more strategic deftness in their global relationships, and take advantage of multiple economic, diplomatic and political partners. We have great examples of that behaviour of having multiple relationships that are beneficial within Africa. A country like Tanzania does that extremely intelligently. It works with multiple partners and doesn’t allow itself to be forced to choose one global partnership over another. I think there are so many opportunities in Africa that there’s room for the Chinese to invest, there’s room for the Europeans, there’s room for the Americans, there’s room for everybody to engage. We must not be made to make false choices. There’s no choice to be made.