China set to stimulate growth amid global uncertainty

Common vision for financial cooperation

Mauritius' Government Programme 2025-2029, delivered by the President of the Republic of Mauritius Dharam Gokhool on Jan 24, and the Government Work Report delivered by Chinese Premier Li Qiang on March 5 share a common vision of financial modernization, economic resilience, and international cooperation. Both countries recognize the strategic importance of financial sector reforms and enhanced monetary cooperation in global trade and investment. With Mauritius' ambition to reinforce its position as a regional financial hub and China's continued push for the RMB's internationalization, the two nations have a unique opportunity to deepen financial cooperation, leverage the Mauritius-China Free Trade Agreement, and extend financial cooperation into the broader Southern African Development Community region.

A key milestone in this evolving financial relationship was the 2 billion yuan ($276 million) currency-swap agreement between the Bank of Mauritius and People's Bank of China, signed in September 2024. This agreement enhances liquidity for RMB-denominated transactions, facilitates cross-border trade and investment. Mauritius can leverage this currency-swap deal to position itself as a regional RMB-clearing center with China expanding its financial footprint on the African continent, thus attracting African businesses seeking access to Chinese capital markets.

As an international financial center, Mauritius can integrate itself into China's financial ecosystem, offering RMB-settlement services, trade financing, and digital payment platforms tailopred for businesses operating in the continent. By aligning with China's cross-border interbank ayment system, which is a renminbi-based settlement system, Mauritius can enhance the efficiency of RMB transactions in the SADC region, enabling smoother trade and investment flows between African economies and China.

Mauritius' Government Programme 2025-2029 also prioritizes modernizing the financial services industry, adapting the global business sector, and enhancing regional economic integration. Given that Mauritius already serves as a gateway for African trade and investment, financial cooperation with China can extend beyond bilateral exchanges to the broader SADC region, which includes key economies such as South Africa, Tanzania, Zambia, and Angola. By working with Chinese financial institutions, Mauritius can facilitate the expansion of RMB liquidity and trade financing solutions across SADC countries, supporting economic diversification and industrialization in the region.

The emphasis on green finance and sustainable investments in both reports also presents an opportunity for Mauritius and China to collaborate on RMB-denominated green bonds and environmental, social and corporate governance (ESG)-compliant financial instruments. This can attract Chinese capital into infrastructure, renewable energy, and digital finance projects in the SADC region, fostering sustainable economic growth while reinforcing Mauritius' role as a regional financial hub.

Looking ahead, Mauritius and China can focus on deepening their financial collaboration by strengthening institutional frameworks, promoting RMB usage in trade agreements, and integrating African economies into China's financial networks. By leveraging the currency-swap agreement, the MCFTA, and China's global financial reforms, Mauritius has the potential to anchor China's financial expansion in the African continent, ensuring a stronger, more resilient, and interconnected regional economy.

Hans Seesaghur, international affairs specialist and sinologist, former China chief representative at the Mauritius Economic Development Board Representative Office in Shanghai, and former Economic and Commercial Counsellor at the Embassy of Mauritius in Beijing.