Since io seems as valid as many non geographic domain names I can't see why it wouldn't just become one of those. Probably money involved somewhere though.

I mean, the .su TLD which was for the USSR, still exists, and still taking registrations, so I don't think a region stopping existing as far as ISO country codes are concerned, is always going to be fatal - Mauritius I imagine could petition ICANN to keep it alive (and make some revenue from it)