Réunion offers an attractive destination for foreign investors given its political stability as an overseas region of France, robust infrastructure, skilled workforce, and modern business environment. Strategically located in the Indian Ocean it is known to provide access to emerging African and Asian markets.
Priority sectors identified by the government to attract FDI include- tourism, renewable energy, digital technologies, agri-business and food processing. Incentives encompass tax breaks, co-funding for initial capital investments as well as facilitated administrative procedures. These help offset Réunion’s remoteness from mainland Europe.
The tropical island landscape also opens prospects in areas like sustainable agriculture, fisheries, and forestry. However—the small size of the local consumer market poses scaling challenges. Building export capabilities right from the outset is thus essential for investors. Entry barriers also exist for overseas companies in sectors dominated by large France-based corporations.
Overall—Réunion’s political and social stability, coupled with its natural and human capital strengths, make it an attractive launchpad for wider Indian Ocean operations. Partnering with local firms helps international investors navigate administrative complexities. Robust infrastructure and digital connectivity also facilitate integration with global supply chains.
Réunion, a French overseas department, offers opportunities for foreign investment in its economy, particularly in the renewable energy sector. The region has been focusing on sustainable tourism and has sought to promote investment in this area and is inclusive of appropriate foreign investment.
Additionally —Reunion Infrastructure — a technology-enabled finance company which is known to specialize in the transfer of tax credits for renewable energy projects is working closely with solar, wind and battery storage companies to sell renewable energy tax credits— which can fund up to ~50% of project costs
However—like any region— Réunion also presents challenges for foreign investment, such as lack of clarity in the government’s agenda, red tape, burdensome regulations and unpredictability in legislation. Despite these challenges, the region has been devoting significant resources to attracting foreign investment through policy incentives and marketing.
Therefore—while there are opportunities in the renewable energy sector— potential investors should carefully consider the existing challenges and the support provided by the government to make informed investment decisions.
