Mauritius: A gateway financial centre for the Indian Ocean

Positioned between Asia's capital and Africa's need for capital, AfrAsia Bank is becoming a nexus for business in the region

May 29, 2015

James Benoit, CEO of AfrAsia Bank, tells World Finance about the latest trends in wealth management for the bank’s diverse client base.

World Finance: The Asian growth story is continuing – unlike sluggish economic performance in neighbouring regions. With this growth has also come burgeoning optimism in the wealth management sector. Here to share insight: James Benoit. James, thank you so much for joining me today, now tell me about how this sector of wealth management is evolving?

James Benoit: Wealth is not really ever destroyed, it just kind of moves, or changes shape. So total global wealth is in excess of $50tr, that’s up 14 percent year over year. Even in the markets that we’re close to in Africa, it’s up seven percent: there’s still 150,000 high-net-worth individuals in Africa, with an excess of $1.3tr of worth. So you know: wealth is still growing, no matter what’s happening in the global economy.

World Finance: You talk about sort of, this first generation that’s really had access to funds that perhaps never has existed before; tell me: how do you place your bank in this growth story?

Well, we’re a niche provider, so people expect us to have insights into Asia, into India, into Africa. Whether it’s linked to gold, or commodities, or linked to those stock markets. So we provide a lot of asset classes, funds, structured products that take advantage of what’s happening in those economies. Those are the insights that we bring: being AfrAsia Bank, sitting in the middle of Mauritius, between all those Indian Ocean economies.

So people come to us for insights in those markets, and that’s what we try to deliver.

World Finance: African-Asian consumers; they’re going to be asking for something different. What asset classes really appeal to them the most?

James Benoit: They still like gold, even though gold has been beaten down, and it’s been very volatile; but there’s a passion for gold.

They also like real estate; real estate is always very popular, so we have opportunities linked to real estate as well.

And then commodities, and also just emerging equity market stories. They’re very keen to invest in their region.

World Finance: Now Mauritius has a reputation, like some of the other islands nearby, that it could potentially be a tax haven. How does the government restore faith that they’re really taking a get-tough approach on regulation?

James Benoit: Well Mauritius always ranks among the most compliant countries in the world, whether it’s the OECD or FATF. So we have state-of-the-art legislation. Recently there’ve been some high-profile cases, where they have cracked down: quite determinedly so.

It’s never had any major convictions or offences linked to, whether it’s Indian or the markets. So it’s taken very seriously, because we don’t want to have that reputation as a tax haven, per se.

And you know: Mauritius is 1.3 million people, so it’s a real economy. It’s a financial services centre built on top of a real economy, which is linked to Asia and Africa. So we’re really serving those people who are doing business in that part of the world, rather than just the wealthy from anywhere.

So that’s our speciality, and that’s what Mauritius is doing.

World Finance: If you could advise the government tomorrow on how it could go that one step further to instil confidence in local clientele and those internationally, what would you say that the government should do?

James Benoit: Global standards are global standards now, so there really is no way to avoid that. And the faster any jurisdiction gets up to that speed is better. So Mauritius has done a good job of that, but still… probably to tailor it to our core markets: Asia, Europe, Africa. I mean, the US is the US, but we’re probably more likely to do better by tailoring our legislation to those key markets, and make sure that we’re aligned. Because really there is no way to avoid what is now a very complex and increasing global regulatory framework.

World Finance: So as you look at those particular regions, where do you place your bank in the growth story, moving in the next few years?

James Benoit: Well, I spent most of my career growing up in south-east Asia, and south-east Asia is still booming. I’m now based in Mauritius, capitalising a lot on eastern Africa. For many of us that market reminds us of Asia 20 years ago. So I’d say India, Africa, still very much in the early stages of growth. We’ve positioned AfrAsia Bank in Mauritius to be right in between Asia capital, Africa’s need for capital, and also Europeans and other people doing business in the region. So we’re really becoming a gateway financial centre for the Indian Ocean.