(Bloomberg) -- The Bank of Mauritius wants to find a way to wind down its role in an investment fund set up during the Covid pandemic, Governor Rama Krishna Sithanen told reporters in the capital, Port Louis, on Saturday.
Incorporated in June 2020 as a special purpose vehicle, the Bank of Mauritius seeded the Mauritius Investment Corp. with 81 billion rupees ($1.74 billion). The MIC was designed to “provide support through a range of equity/quasi-equity instruments in view of ensuring that systemic economic operators are kept afloat” and jobs preserved during the pandemic.
As of Sept. 30, the MIC had disbursed 56.8 billion rupees to 60 entities, with 31% going to the Indian Ocean island nation’s tourism sector. The MIC also holds a 49% stake in Airport Holdings Ltd, a group that includes Air Mauritius, the national airline, duty free shops, and airport infrastructure.
“It’s not the role of the central bank to invest in land, to invest in shares of some companies. It deviates from its core activities. There might be conflict of interests,” Sithanen said. “We are substituting ourselves for banks.”
The central bank getting its money back “would strengthen our balance sheet,” said Sithanen, a former finance minister and lawmaker who was named to a three-year term at the head of the central bank in mid-November.
“I’m in favor of finding a solution so that the MIC is no longer on the balance sheet of the Bank of Mauritius,” he said. “We need to return to our core mandate.”
In October 2022, the MIC announced that it had become an associate member of the UK-based International Forum of Sovereign Wealth Funds.
©2024 Bloomberg L.P.