(No. 1B/66)

Mr E. Guimbeau (First Member for Curepipe & Midlands) asked the Vice-Prime Minister, Minister of Finance and Economic Development whether, in regard to the Jin-Fei, ex-Tianli project, in Riche Terre, he will now consider tabling the Framework Agreement and, if not, why not.

(Vide reply to  PQ 1B/60)

TIANLI – LEASE

(No. 1B/60) Mr G. Lesjongard (Second Member for Port Louis North and Montagne Longue) asked the Minister of Housing and Lands whether, he will inform the House if, following the transfer of the lease between Tianli and Jin-Fei, his Ministry has written off any amount owed as rental by Tianli and, if so, indicate the amount.

Reply (Vice-Prime Minister, Minister of Finance and Economic Development): I will reply to PQ 1B/60 addressed to my colleague the hon. Minister of Housing and Lands and to PQ 1B/66 addressed to me at the same time since they relate to the same subject.

As the House is aware, the Jin-Fei Zone is one of five economic zones that the People’s Republic of China is supporting in Africa. It is the outcome of intense lobbying by the Prime Minister during the Sino Africa Summit held in Beijing in 2006 for Mauritius to be part of the Africa development strategy by the Chinese Government.

I wish to inform the House that I am not in a position to table the Framework Agreement as there is a confidentiality clause which provides that the parties to the Agreement should ensure strict confidentiality on the Agreement.

However, I am pleased to provide information on essential aspects of the project.  Government  succeeded in convincing the Chinese promoters to choose Mauritius over other African countries by offering a package that includes the provision of off-site infrastructure with a contribution of Rs100 m. from the promoters, a tax platform of 15% applicable to all investors, leased land at concessional rates on a similar basis to what has traditionally been offered to investors in new sectors, including on Pas Geométriques and on industrial zones, and passports for a

limited number of investors, namely one passport for every USD 500, 000 of investment.

Regarding the lease of land, a portion of land of 211 hectares has been earmarked for the Tianli project.  Government had planned to release the land in two stages since 160 hectares were still under occupation of the planters of the Terre Rouge Land Settlement.

A first lease agreement was signed between Government and the Tianli Enterprise Group for a portion of 51 hectares of land on 12 July 2007.  The lease agreement for the second portion of land of 160 hectares was not signed as the land could not be released in totality until December 2008.

Following representations from Tianli, Government approved, on 26 March 2009, an amendment of the first lease agreement to provide for the addition of the remaining 160 hectares, to be effective as from 12 February 2009.  The deed of amendment was prepared but was not signed by Tianli because of ongoing discussions among the Chinese promoters.

Following an overhauling of the shareholding structure of the company and its renaming into Mauritius Jin-Fei Economic and Trade Cooperation Zone Company Ltd, a revised implementation schedule was agreed for the project and the project implementation started on 16 September 2009.  Thus the Chinese side namely Jin-Fei signed the amended lease agreement in respect of the 211 hectares only on 16 September 2009.  Regarding the lease rentals for the 160 hectares of land for the period up to the date of the signature of the lease agreement, Government agreed to waive the dues since the land was encumbered.

Investment in the Jin-Fei Project is estimated at USD 750 million.  This project will assist Mauritius to realize its ambitions of becoming a bridge between Asia and Africa.