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ECONOMIC OVERVIEW
  

 

 

Seychelles has a mixed, developing economy that is heavily dependent on tourism and fisheries. Growth has been led by the tourism sector, which directly employs about 30% of the labor force and directly and indirectly accounts for over 50% of the GDP, and by tuna fishing. Seychelles’ recent economic performance has been strong, benefiting from the continued growth of the tourism sector. Gross domestic product (GDP) growth in 2019 was 5.3%. In recent years, the government has encouraged foreign investment to upgrade hotels and tourism industry services. At the same time, the government has moved to reduce the dependence on tourism by promoting the development of the offshore financial services, ICT and communication, as well as the renewable energy sectors.

As a small open economy dependent on tourism, Seychelles remains vulnerable to developments such as economic downturns in countries that supply tourists, natural disasters, and climate change. One of the main challenges facing the government is implementing strategies that will increase Seychelles' long-term resilience to climate change without weakening economic growth.

The formal unemployment rate was 2.3% in the last quarter of 2019., indicating a tight labor market consistent with robust recent economic conditions. The country’s external position has been stable in recent years, but structural vulnerabilities remain due to Seychelles’ heavy reliance on imported goods and on foreign funding for investment. Seychelles runs large, structural current account deficits, financed substantially by foreign direct investment (FDI).

 

 

TOURISM

 


The tourism sector has been central to the Seychelles economy since the opening of the Seychelles International Airport in 1971. Tourism, is the largest economic pillar of Seychelles, directly or indirectly generated about 72 percent of the GDP, about 70 percent of total foreign exchange earnings and more than 30 percent of employment. Visitor numbers in 2019 were 384,204 (more than 4 times of its population), it was a 6.2% increase over 2018, generated an income of USD602 million. European markets remain key to the Seychelles tourism industry, visitors are mainly from France, UK, Italy, Germany, Switzerland and United Arab Emirates etc., but the sector is also benefiting from increases in tourists from other regions, facilitated in part by more airline connections.

 
 

FISHERIES
Seychelles has an exclusive economic zone (EEZ) of approximately 1.4 million km2, almost 3,000 times the size of its land area. It is one of the world’s biodiversity hotspots, with an extremely rich marine and terrestrial biodiversity. Fisheries is the second most important sector after tourism, contributing 20 % to the GDP and employing 17% of the population. Seychelles is also a major seafood processing hub. In 2019, the export of consumable fish and fish products made up 90% of its total value of domestic exports. However, pressures from the fisheries and tourism sectors on coastal and marine natural resources are reaching unsustainable levels. Seychelles is now refocusing its development around a sustainable blue economy.

 
 
FINANCIAL SERVICES
The financial services sector is the 3rd pillar of the Seychelles economy and the Seychelles Financial Services Authority (FSA) is the autonomous regulatory body responsible for the non-bank financial services in Seychelles. It was established under the Financial Services Authority Act, 2013, the Authority is responsible to license, regulate, enforce regulatory and compliance requirements, monitor and supervise the conduct of business in the non-bank financial services sector in Seychelles. As an increasingly mature financial jurisdiction, the FSA and the non-bank financial services industry in Seychelles, continue to be a strong contributor to the Seychelles economy.

Seychelles has over the years established itself as a reputable financial jurisdiction and an international financial center of substance. To sustain the good repute of the jurisdiction, support international obligations and gain greater credibility, Seychelles has committed itself to compliance with several international organizations, namely, the OECD, the International Organization of Securities Commission (IOSCO), Committee of Insurance, Securities, and Non-Banking Authorities (CISNA), Financial Action Task Force (FATF), European Union (EU), and the International Association of Insurance Supervisors (IAIS).

 
 

 

Photo copyrights: STB Team, Leisure and Business 2012 - SEYCHELLES, other copyright 2013 Honorary Consulate of the Republic of Seychelles in Hong Kong. All Rights Reserved.