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Seychelles economyBasic economy in the Seychelles, property possession, industry, trade, culture, population, currency, map, economy facts | |||
Basic Economy in the SeychellesDuring the plantation era, cinnamon, vanilla, and copra were the chief exports. In 1960, some 33% of the working population worked at plantations. Another 20% worked in the public or government sector. In 1971, the international airport opened, and tourism leapt into prominence. The economy was basically divided into plantations and tourism. The tourism sector paid better, and the plantation economy could only expand so far, due to market forces affecting the prices that exports could command. The plantation sector of the economy declined in prominence, and today agriculture only accounts for about 4% of the Gross Domestic Product. Even though copra from the Seychelles is high quality, the possibility exists that the plantation segment of the economy could disappear altogether. Now tourism employs 30% of the labor force, 13% of the GDP, and 60% of the foreign exchange income. The World Bank defines the Seychelles as being upper-middle income, but the distribution of the wealth is skewed. In the year 1992, 7% of the Seychelles population was considered poor. The currency used in the Seychelles is the Seychelles rupee, and there are about five Seychelles rupees to the US dollar.Property PossessionFor most of the Seychelles’ relatively young history, natives possessed almost all the land, but after the Seychelles gained independence in 1976, more land has been bought by outsiders. In 1960, two thirds of the agricultural land was owned by just 56 people. By 1976, some 56% of the land was held by foreigners.IndustryTourism is mostly marketed to upper income people. At the same time, aquaculture is gaining prominence, as are tuna fishing and canning. There is not a lot of manufacturing, but what there is has to do with international trade. The Seychelles also allow registration of foreign companies.TradeExport accounts for much of the trade in the Seychelles, but tuna, plantation crops, local fish, and local vegetables account for much of the domestic trade. Many of the souvenirs that are sold to tourists are made elsewhere. Tourism is the biggest part of the Seychelles’ economy, employing a sizeable percentage of the population. Farming and fishing employ some, as do industries that process coconuts and vanilla. The prime agricultural products in the Seychelles include sweet potatoes, vanilla, coconuts, and cinnamon. These products provide much of the economic support of the locals.Frozen and canned fish, copra, cinnamon, and vanilla are the main export commodities of the islands. When the Seychelles gained independence in 1976, per capita output in the region has grown significantly. The Seychelles now produce about seven times what they did earlier, in a near-subsistence economy. Growth in the Seychelles is largely due to tourism, which employs about a third of the labor force and which accounts for over two-thirds of currency earnings from tuna fishing. In recent years, the government has used foreign investment to renovate and upgrade hotels and services. At the same time, the government has tried to reduce dependence on tourism by encouraging farming, fishing, and light industry. During the first Gulf War in 1991, and for a year afterwards, the tourism industry took a hit. But it rebounded well afterwards. The government of the Seychelles understands the ongoing need to upgrade the tourism sector due to strong competition. Other government issues of concern are controlling budget deficits and privatization of some of the public sectors. Toward the end of the 20th century, the tourism and tuna sectors slowed the economy with their slowing growth. Fishing and tourism are the major segments of the economy of the Seychelles. Most employment, foreign earnings, construction, banking, and commerce depend on these industries. In the services sector, including commerce, transportation, communications, and tourism account for well over two-thirds of the GDP in the 21st century. Manufacturing accounts for between 15 and 20% of the GDP, but this figure changes from year to year due to changes in output of the Indian Ocean itself. The government sector has invested in infrastructure to keep construction going, with about a 10% share of the GDP. Because of the shortage of land used for agriculture, fishing, forestry, and agriculture do not account for much of the Seychelles’ output. In the year 2007, the GDP of the Seychelles was US$710 million, and the per capita income was over $16,000. By the standards of the World Bank, this puts the Seychelles in the high middle income level. This means that the islands are low priorities for international donors, and international help for the Seychelles is limited. Because of the small size of the economy in the Seychelles, relatively small changes in world economics can make a significant difference to the health of the Seychelles economy.
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Tags: seychelles economy, economy, economy of the seychelles |