Mauritius and Nigeria have just signed a new treaty for the avoidance of double taxation.
The new Double Tax Agreement (DTA) between Mauritius and Nigeria comes as part of Mauritius’s wider strategy to develop a large treaty network across Africa in order to promote Mauritius as the ideal offshore location to channel direct investments into Africa.
Mauritian Finance Minister Xavier-Luc Duval has also recalled that Africa’s average growth is around 6% per year, meaning that Mauritian growth should be driven by Africa in the future.
Nigeria is the 17th African country with which Mauritius has signed a DTA.
The new tax treaty will reduce the current level of uncertainty of foreign investors intending to expand into Nigeria, as Mauritius-based investors should be relieved from any double taxation in the future and enjoy a clearer allocation of taxing rights.
Oil-rich Nigeria has a population close to 200m inhabitants, with a GDP growth averaging 7% per year. Banking modernisation and economic reforms were implemented back in 2008 to diversify the economy in the wake of the 2008 financial crisis and the subsequent oil price crash. Nigeria has particularly been successful in developing a strong telecommunications industry, with 80 million mobile phones now in Nigeria and very cheap call rates.