1. World Trade Organisation

Its objectives

The World Trade Organisation (WTO) is an international body dealing with international trade rules. At its heart are the WTO agreements, negotiated and signed by the bulk of the world's trading nations. The organisation aims to facilitate trade among countries by creating conditions of competition that are fait and equitable. Towards this end, it encourages countries to enter into negotiations for the reduction of tariffs and for removal of other barriers to trade, and requires them to apply a common set of rules to trade in goods and service.

These rules are contained in the following legal instruments:

- General Agreement on Tariffs and Trade (GATT): whose rules apply to trade in goods;
- Other Agreements on goods
- General Agreement on Trade in Services (GATS); whose rules apply to trade in services; and
- Agreement on Trade Related Aspects of Intellectual Property (TRIPS)

Member countries are under an obligation to ensure that their national legislations, regulations and procedures are in full conformity with the provisions of these agreements. The resulting harmonisation by all countries of rules and regulations applicable to trade in goods and services facilitates trade. The harmonised rules also go to ensure that national regulations do not create unneccessary barriers to trade and that country's exports are not disrupted by the sudden imposition of higher tariffs or other barriers to trade.

2. Abuja Treaty on African Economic Community

Mauritius is a party to the Treaty establishing the African Economic Community which was concluded on 3 June 1991 in Abuja, Nigeria. This Treaty provides for the gradual establishment of an African Economic Community by the year 2025.

3. The Cotonou Agreement

Mauritius is a signatory is the ACP-EU Agreement known as the Cotonou Agreement, between 77 African, Caribbean and Pacific (ACP) States and the European Union, which replaces the Lomé Convention.

The system of trade preferences which the Community had previously granted the ACP states will gradually be replaced by a series of new economic partnerships based on the progressive and reciprocal removal of trade barriers. These agreements will be defined as part of a broader strategy to improve the ACP States' ability to attract private sector investment.
The objectives of economic and trade cooperation are:
· To promote smooth and gradual integration of ACP economies into the world economy
· To enhance production, supply and trading capacities
· To create new trade dynamics and foster investment
· To ensure full conformity with WTO provisions

There are four regional groupings to which Mauritius belongs: the Common Market for Eastern and Southern Africa (COMESA), the Southern African Development Community (SADC), the Indian Ocean Commission (IOC), and the Indian Ocean Rim Association for Regional Cooperation (IOR-ARC).

4. Common Market for Eastern and Southern Africa (COMESA)

The COMESA comprises 20 Member States of Eastern and Southern Africa with a total population of about 385 million. These Member States are: Angola, Burundi, Comoros, Djibouti Democratic Republic of Congo, Egypt, Eritrea, Ethiopia, Kenya, Libya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Sudan, Swaziland, Uganda, Zambia, Zimbabwe.

It was established in 1994 in replacement of the Preferential Trade Agreement (PTA) which was launched in 1982. With COMESA's economic and historical background, its main objective has been the formation of a large economic and trading unit. Its strategy has been to gradually cut tariffs so as to reach a free trade area in October 2000. COMESA is now expected to further accelerate the regional integration process by moving to a Customs Union by 2008.

COMESA Rules of Origin (COMESA Revised Manual Sixth R.O.O.)

COMESA Rules of Origin are a set of criteria that are used to distinguish between goods that are produced within COMESA Member States and are entitled to preferential tariff treatment.

The COMESA Preferential Rules of Origin are as follows:

• The goods should be wholly produced in a Member State; or

• The goods should be produced in a Member State and the c.i.f. value of any foreign materials used should not exceed 60% of the total cost of all materials used in their production; or

• The goods produced in a the member States and attain a value added of at least 35% of the ex-factory-cost of the goods; or

• The goods should be classifiable under a tariff heading other than that of the tariff heading of the non-originating materials used in their production (CTH Rule).

Important Note: COMESA member States have finalised the minimal processes required for the CTH Rule to apply only for a limited number of products.

For the other products on which discussions have not yet been finalised, the CTH rule is not applicable.

Agreed list of products and the specified processes required to be carried out leading to a Change in Tariff Heading (COMESA CTH Rule)

Reporting of Non-Tariff Barriers in COMESA

In order to provide for the gradual elimination of Non Tariff Barriers (NTBs) in the region, COMESA Member States have come up with a common NTB Reporting Form to be used by importers and exporters.

Non Tariff Barriers have the capacity to restrict trade and are real impediments to the free exchange of goods. NTBs are most often imposed by the importing countries and they usually take the form of excessive import surcharges, arduous sanitary standards, restrictive import permits and licenses, pre-shipment inspection, and cumbersome customs procedures and documentation amongst others.

The complaints must be made on the prescribed form and sent either to the Chamber or to the Ministry of Foreign Affairs, International Trade and Regional Co-operation. The identified NTB will then be reported to the COMESA Secretariat through the national NTB Enquiry Point for follow-up and for the elimination/reduction of the NTB.

5. Southern African Development Community (SADC)

The SADC was established in August 1995 with a view to enhance the standard and the quality of life of the people and to make the maximum use of natural resources of its member countries. SADC groups 13 member states, namely Angola, Botswana, Democratic Republic of Congo, Lesotho, Malawi, Mauritius, Mozambique, Namibia, South Africa, Swaziland, Tanzania, Zambia and Zimbabwe.

Mauritius has adhered to seven SADC Protocols, including a Trade Protocol. The latter is operational since 1st September 2000 and paves the way for a phasing out of a minimum of 85% of tariffs as from that date and within eight years, and all tariffs by 2012. A free trade area is expected to be created by 2012.

Contrary to COMESA, the presence of an economic power and trading partner like the Republic of South Africa in this bloc gives the latter a much larger dimension than other Agreements to which Mauritius is party.

Search SADC Tariff Reduction Schedule

6. Indian Ocean Commission (IOC)
Together with Madagascar, Seychelles, Comoros and Reunion, Mauritius forms part of IOC whose objective is to enhance cooperation among member states on a range of fronts, mainly diplomatic, economic, cultural and scientific cooperation. Among other achievements, customs duties have been removed reciprocally in Madagascar and Mauritius on originating goods under the aegis of IOC.

7. Indian Ocean Rim - Association for Regional Cooperation
Mauritius also forms part of the Indian Ocean Rim - Association for Regional Cooperation. This association was established in 1997 and has the objective of establishing a regional framework for improving trade relationships among member countries. There are 10 members, totaling a population of over 1595 million, that constitute the arrangement: Australia, Bangladesh, India, Indonesia, Iran, Kenya, Madagascar, Malaysia, Mauritius, Mozambique, Oman, Seychelles, Singapore, South Africa, Sri Lanka, Tanzania, Thailand, United Arab Emirates and Yemen. Two countries, namely Egypt and Japan, have an observer status.

8. Generalised System of Preferences
Mauritius is a beneficiary of the Generalized System of Preferences (GSP) scheme, which is a preferential tariff system extended by some 27 developed countries (known as preference-giving countries). It provides for Most Favoured Nation (MFN) reduced tariffs or duty-free treatment on eligible products exported by the beneficiary countries to the markets of the preference-giving countries.

In order to be eligible for preferential treatment, the developing countries have to abide by the GSP rules of origin. The main elements of the rules of origin are that goods must:
- be either wholly obtained in a preference- receiving country
- meet a process and percentage criterion
- be directly transported to a preference-giving country
Within the parameters of such main elements, each country has its own specific rules and list of products eligible for preferential treatment.

9. African Growth and Opportunity Act (AGOA)

The AGOA is the first ever trade and investment legislation on Africa that was recently adopted by the US Congress. The Act encourages a transition from aid to trade for Sub-Saharan African countries committed to economic and political reforms. This non-reciprocal Trade Agreement provides that African products meeting eligibility requirements when imported from designated beneficiaries will receive duty free treatment in the United States for a renewable period of 8 years.

The trade preferences contained in the Africa Growth and Opportunity Act creates very big opportunities for expanded trade and investment ties with the United States. The most important of the preferences deal with apparel exports, although there are significant benefits for other sectors like agriculture.

Eligibility. A Sub-Saharan country would be eligible for benefits only if the President determined that the country is taking steps to establish a market-based economy, does not engage in gross violationss of internationally recognised human rights, and does not engage in activities contrary to the U.S. national security or foreign policy interests.

Generalised System of Preferences (GSP). The Africa Act extends US GSP to eligible African beneficiary countries by eight years until 2008 and expands the list of products that may receive duty-free treatment. This latter decision for expansion will be based on the International Trade Commission's advice regarding the import-sensitiveness of the products. To be eligible for GSP, countries must observe internationally recognised worker rights.

Quota-free access on apparel trade. Existing export quotas on Mauritius and Kenya will be lifted within 30 days of the establishment of "an effective visa system to prevent unlawful transshipment". Even products that do not qualify for duty-free access, i.e. apparel made in Mauritius from third-country fabric, will nevertheless be quota-free.

Duty-free access on apparel trade. The Act extends duty-free access to apparel imported from Africa subject to certain conditions. With certain exceptions, such duty-free access will be capped during the first year at 1.5% of total U.S. apparel imports during the most recent 12 months for which import data is available, growing in regular annual increments to 3.5% over eight years. The percentage cap will grow reflecting annual growth in total U.S. imports.

Special provision for LDCs. Only those (eligible) countries with per capita income of less than $ 1,500 will be eligible for duty-free access for a period of 4 years for apparel made from third-country fabric. This means that Mauritian companies which are already engaged in regional integration, for example Madagascar, will benefit from this advantage during 4 years. However, another consequence is that Mauritian companies will have to prepare themselves to produce yarn or identify potential suppliers of yarn in sub Saharan Africa.