Thursday, September 27, 2007

Mauritius Africa's best place to do business



This shouldn't come as a surprise, Mauritius has the most sophisticated legal system in Africa and a relatively mature banking system along with a flexible workforce. What's more important to us is that we have moved up to 27 previously we were at 32 . The most significant improvement was in the ease of starting a business, this probably down to the 3 days it now takes to start up, that's our highest world ranking. Dealing with licenses somewhat improved however it should be better. Employing of workers, look for this to improve once the new labor legislation is passed.

Registration of property, Mauritius is ranked at 153, this is absurd, the government should move to digitize the whole regsitry system and make everything publicly available online. With the new property tax systems this could possibly happen. [The gov should move from just provide access to information on its portal, it needs to move to using the internet as tool for people to streamline their interaction with government, eg license application and status updates should be viewable online, property taxes should be payable online]

Another area where Mauritius is ranked quite low is the area of access to credit. First and foremost there needs to be serious review of the local banking sector, anyone in Mauritius can smell corruption and collusion from them, ofcourse their thuggery has been well documented. Two major issues off the top of my head, not sure how microfinance would work b/c the economy is pretty well developed and few people have a farm or small shop. More importantly people don't understand how to use credit and the tools available to them. Legislation should also be introduced to curtail the behavior of lenders, they should provide much more disclosure to their clients. As I have suggested before the government and policymakers needs to focus on the micro economy not just macro factors, they are taking some small steps in the competition bill.

Trading across borders not bad for such a small country, but there certainly is an improvement to be made with SADC, especially with regard to food. The price of food in Mauritius is astronomically high!

Enforcing Contracts/Closing a business: These are two areas where Mauritius should be ranked much higher, instead of 66. Mauritius has a sophisticated legal system, however efficiency needs to be improved in the legal system, hopefully the Privy Council sitting in Mauritius for the September term as of next year will be a catalyst. As for closing a business the insolvency laws need to be updated, as well as improving the administrative bottlenecks, the same way it's easy to start up a business it needs become easier to close a business.

Mauritius Africa's best governed country

Mauritius does look like the best governed country in Africa if you've traveled throughout Africa. What keeps the government in check? A highly literate and engaging public compared to other African countries. In addition Mauritius has a vibrant democracy which I haven't seen having lived and traveled throughout Africa. However, Mauritian's will tell you that there appears to be an alarmingly increasing level of corruption from little guys such as custom officials to the bigwigs such as ministers and politicians. One reason for this is that the social fabric and values of Mauritians has weakened considerably from that of our forefathers. From a structural point of view, many Mauritians complain about the merry go round of the political elite - it's as if they just agree to take turns in government.

Sithanen has done a courageous job at reducing bureaucracy and getting rid of the largesse of many government institutions, however in a country where nearly 60% of employment is through the government there remains a long a way to go. Secondly those in government, throughout the whole system need to be held to higher standard of professionalism and competence.

Wednesday, September 5, 2007

Mauritius the Hong Kong of Africa

"Mauritius is the new rising economic freedom star, not only in the African region, but also in the world. Mauritius is rated at 7.5 and ranked 22nd – up from 7.0 and 39th. This island state is likely to move even higher up the rankings as it is in the process of introducing further reforms such as reducing tax rates, removing price controls, cutting back tariffs, improving the ease of doing business, and relaxing regulations. Mauritius appears set to become Africa’s Hong Kong. Hong Kong has been first in the economic freedom rankings for many years. In order to make its citizens more prosperous, the government of Mauritius is intent on attracting to its shores people with capital, skills and spending money. With the declared intention of being in the top 10 of the World Bank’s Ease of Doing Business index, Mauritius is creating an attractive business, working and consumer environment."

According to Eustace Davie Freemarket Foundation SA

Saturday, September 1, 2007

Lee Kuan Yew

Modern Singapore’s Creator Is Alert to Perils
By SETH MYDANS and WAYNE ARNOLD

SINGAPORE, Sept. 1 — Lee Kuan Yew, who turned a malarial island into a modern financial center with a first-world skyline, is peering ahead again into this city-state’s future, this time with an idea to seal it off with dikes against the rising tides of global warming.

“Let’s start thinking about it now,” he said during an interview in late August, in what could be the motto for a lifetime of nation building. Ever since Singapore’s difficult birth in 1965, when it was expelled from Malaysia, he said, the country has struggled to stay alive in a sea of economic and political forces beyond its control.

“If the water goes up by three, four, five meters, what will happen to us?” he said, laughing. “Half of Singapore will disappear.”

For all his success, Mr. Lee, 83, remains on the alert for perils that may exist only on the distant horizon: the rising role of China in the region as the United States looks the other way, the buffeting of the world economy, even climate change.

A British-educated lawyer who led Singapore for 31 years, Mr. Lee is one of Asia’s remarkable personalities, a world figure whose guest book is filled with the names of international political and financial leaders.

His creation, modern Singapore, is an economic powerhouse with one of the world’s highest per capita incomes and high-quality schools, health care and public services that have made it a magnet for global labor. Foreigners make up roughly a fifth of its 4.5 million residents.

In his office in the former headquarters of the island’s British colonial rulers, Mr. Lee sat back in a zippered blue jacket, sipping small cups of hot water and laughing often, seemingly as different as could be from the bare-knuckled political infighter he has described himself as.

“I’ve done my bit,” said Mr. Lee, who stepped down as prime minister in 1990 and now watches over the country — and occasionally takes part in political disputes — with a seat in the cabinet and the title of minister mentor. His eldest son, Lee Hsien Loong, is prime minister.

“To understand Singapore,” he said, “you’ve got to start off with an improbable story: It should not exist.”

It is a nation with almost no natural resources, without a common culture — a fractured mix of Chinese, Malays and Indians, relying on wits to stay afloat and prosper.

“We have survived so far, 42 years,” he said. “Will we survive for another 42? It depends upon world conditions. It doesn’t depend on us alone.”

This sense of vulnerability is Mr. Lee’s answer to all his critics, to those who say Singapore is too tightly controlled, that it leashes the press, suppresses free speech, curtails democracy, tramples on dissidents and stunts entrepreneurship and creativity in its citizens.

“The answer lies in our genesis,” he said. “To survive, we have to do these things. And although what you see today — the superstructure of a modern city — the base is a very narrow one and could easily disintegrate.”

Asked whether, looking back, he felt he might have gone too far in crushing his opponents, sometimes with ruinous lawsuits, sometimes with long jail terms, he answered: “No, I don’t think so. I never killed them. I never destroyed them. Politically, they destroyed themselves.”

One of his concerns now, Mr. Lee said, is that the United States has become so preoccupied with the Middle East that it is failing to look ahead and plan in this part of the world.

“I think it’s a real drag slowing down adjusting to the new situation,” he said, describing what he called a lapse that worries Southeast Asian countries that count on Washington to balance the rising economic and diplomatic power of China.

“Without this draining of energy, attention and resources for Iraq, Iran, Lebanon, Israel, Palestine, there would have been deep thinking about the long-term trends — working out possible options that the U.S. could exercise to change the direction of long-term trends more in its favor,” Mr. Lee said.

As the United States focuses on the Middle East, Mr. Lee said, the Chinese are busy refining their policies and building the foundations of more cooperative long-term relationships in Asia. “They are making strategic decisions on their relations with the region,” he said.

And this is where tiny Singapore sees itself as a model for China, the world’s most-populous country. “They’ve got to be like us,” Mr. Lee said, “with a very keen sense of what is possible, and what is not.”

Every year, he said, Chinese ministers meet twice with Singaporean ministers to learn from their experience. Fifty mayors of Chinese cities visit every three months for courses in city management.

Singapore’s secret, Mr. Lee said, is that it is “ideology free.” It possesses an unsentimental pragmatism that infuses the workings of the country as if it were in itself an ideology, he said. When considering an approach to an issue, he says, the question is: “Does it work? Let’s try it, and if it does work, fine, let’s continue it. If it doesn’t work, toss it out, try another one.”

The yardstick, he said, is: “Is this necessary for survival and progress? If it is, let’s do it.”

Hoping to attract more tourists, for example, Singapore is building two huge casinos, despite Mr. Lee’s expressed distaste for them.

“I don’t like casinos,” he said, “but the world has changed and if we don’t have an integrated resort like the ones in Las Vegas — Las Vegas Sands — we’ll lose.

“So, let’s go,” he said. “Let’s try and still keep it safe and mafia-free and prostitution-free and money-laundering-free. Can we do it? I’m not sure, but we’re going to give it a good try.”

Even on social issues on which he has tended to seem inflexible, Mr. Lee sounded almost mellow.

“I think we have to go in whatever direction world conditions dictate if we are to survive and to be part of this modern world,” he said. “If we are not connected to this modern world, we are dead. We’ll go back to the fishing village we once were.”

For example, on the issue of homosexuality, he said, “we take an ambiguous position. We say, O.K., leave them alone, but let’s leave the law as it is for the time being, and let’s have no gay parades.”

Although gay sex remains technically illegal in Singapore, the government has indicated it will not actively enforce the law.

China, Hong Kong and Taiwan already have more liberal policies regarding gays, he noted. “It’s a matter of time,” he said. “But we have a part Muslim population, another part conservative older Chinese and Indians. So, let’s go slowly. It’s a pragmatic approach to maintain social cohesion.”

As for people’s adherence to the “Asian values” — hierarchy, respect and order — that Singapore is founded on, he said: “It’s already diluted, and we can see it in the difference between the generations. It’s inevitable.”

In his own family, generational values are changing. From father to children to grandchildren, he said, command of the Chinese language has weakened, along with the culture it embodies.

“They had a basic set of traditional Confucian values,” he said of his children, two sons and a daughter. “Not my grandchildren.”

One grandson has just begun studies at M.I.T., he said; the other is heading to the Wharton School of the University of Pennsylvania.

This well-educated younger generation reflects the social dichotomy of Singapore, Mr. Lee said, in which the top 20 percent of the population is as cosmopolitan as any, surfing the Internet and traveling the world without constraint. “This is not a closed society,” he insisted.

But at the same time, he said, the government must protect the less affluent, less educated people from information that might upset or confuse them. These are people “who are not finding it so comfortable to suddenly find the world changed, their world, their sense of place, their sense of position in society.”

They are the ones who he said had to be pulled into the future as he seeks to make Singapore “a first-world oasis in a third-world region.”

“We built up the infrastructure,” he said. “The difficult part was getting the people to change their habits so that they behaved more like first-world citizens, not like third-world citizens spitting and littering all over the place.”

So Singapore embarked on what Mr. Lee called “campaigns to do this, campaigns to do that.”

Do not chew gum. Do not throw garbage from rooftops. Speak good English. Smile. Perform spontaneous acts of kindness.

Paradoxically, he said, if Singapore had not been so poor it might never have transformed itself and prospered as it has. His warnings about vulnerability and collapse are a constant theme to persuade his people to accept limits on their freedoms.

“Supposing we had oil and gas, do you think I could get the people to do this?” Mr. Lee said. “No. If I had oil and gas, I’d have a different people, with different motivations and expectations.

“It’s because we don’t have oil and gas and they know that we don’t have, and they know that this progress comes from their efforts,” he said. “So please do it and do it well.”

Copyright The New York Times Company