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CENTRAL BANK OF SEYCHELLES

QUARTERLY REVIEW

JANUARY – MARCH 2006

Volume XXIV Victoria, April 2006 No. 1


QUARTERLY REVIEW

Vol. XXIV, No.1 January – March, 2006

C O N T E N T S

Page Highlights of the Seychelles Economy I Operations and Administration of the Central Bank XXII CBS QUARTERLY ECONOMIC PAPERS – The Fisheries Industry of the Seychelles: At a Crossroad

S T A T I S T I C A L A P P E N D I X Table 1 Central Bank of Seychelles Summary of Assets and Liabilities 1 Table 2 Consolidated Balance Sheet of Commercial Banks 3 Table 3 Currency Issue and Money 5 Table 4 Quasi-Money and Money Supply 6 Table 5 Credit-Deposit Ratio of Commercial Banks 7 Table 6 Interest Rates 9 Table 7 Distribution of Commercial Bank Credit 10 Table 8 Monetary Survey 11 Table 9 Ownership of Commercial Bank Deposits 12 Table 10 Commercial Bank Reserves and Minimum Reserves Required 13 Table 11 Development Bank of Seychelles 14 Table 12 Treasury Bills 15 Table 13 Treasury Bonds 16 Table 14 Government Stocks 17 Table 15 Rupee Rates of Major Foreign Currencies 18 Table 16 A Seychelles Government Budget - Outlays 19 Table 16 B Seychelles Government Budget - Receipts 20 Table 16 C Seychelles Government Budget - Balance 20

Table 17 Tourism 21 Table 18 Visitor Arrivals by Country of Residence 22 Table 19 Balance of Payments 23 Table 20 Trade in Goods 24 Table 21 Trade in Services 25 Table 22 Imports by Country of Origin 27 Table 23 Domestic exports by main country of destination 28 Table 24 Gross Domestic Product 29 Table 25 Production Indicators 30 Table 26 Seychelles Consumer Price Index 31

Technical Note Owing to rounding of figures, the sum of separate items may not always add up to the total shown. Abbreviations used in this Review are: R = Seychelles Rupee CBS = Central Bank of Seychelles n.a. = Figure not available .. = Negligible -/0 = Nil

HIGHLIGHTS OF THE SEYCHELLES ECONOMY

First Quarter, 2006

1. OVERVIEW

As is usually the case in the Seychelles, and

common with many countries, domestic demand

tends to slacken during the first quarter relative to

the preceding festive season, and in this respect

the opening three months of 2006 did not deviate

from this established pattern. Nevertheless, the

main economic indicators showed mixed

outcomes.

On the fiscal side, despite slippages in expenditure

on both the recurrent and capital budgets, the

government account remained in surplus. At R10

million, the fiscal surplus was short of target by

R17 million. The outcome would have been

worse in the absence of above-budget inflows

pertaining to fishing licence fees and dividends

totalling over R84 million in the aggregate.

Another significant development was the

collection of goods and services tax (GST), which

unlike in recent preceding quarters stood below

target. For the most part, this reflected the

revenue impact of a general reduction in the trades

tax base used in the calculation of GST introduced

at the start of the year. However, with no visible

signs of an impending slowdown in import

demand, the risks of a further contraction in GST

collection remains arguably low.

In the monetary sector, the broad money

aggregate M2(p) reportedly fell by R41 million to

R4,403 million. However, the present policy to

steadily increase national reserves has exerted

upward pressure on the money supply, although in

the current quarter, this was reflected in an

increase in the non-monetary liabilities (net) of

the financial system.

The external accounts posted mixed but overall,

satisfactory results. Inflows in the form of

tourism earnings and canned tuna continued to be

important contributors to the current foreign

exchange inflows. Additionally, a remarkable

growth to R85 million in the net balance under

current transfers, explained largely by a rise in

transfers from the European Union, contributed

positively to current transactions.

On a less encouraging note, the country’s energy

import bill maintained its upward trend for yet

- I -

Quarterly Review Highlights of the Seychelles Economy, Q1, 2006

- II -

another quarter. With no compelling evidence of

any prospective respite in international energy

prices, the authorities are required to allocate in

priority over US$50 million annually to support

the country’s domestic energy requirements on

present consumption parameters. However, the

upward trend in oil prices implies more revenue

can be earned per unit of oil sold by the

Seychelles Petroleum Company (SEPEC) to

foreign ships and aircrafts.

In the real sector, the seasonal slackening in

demand may have contributed to a general fall in

productive activities. These were more apparent

in the areas of retail trade and some

manufacturing. However, the losses in

manufacturing output were more than fully

compensated by the quite robust recovery in

tourism and the rise in construction activity. The

latter was for the most part in respect of the high

level of foreign direct investment (FDI) in new

tourism establishments (including the Eden Island

Project) and the government’s housing

programme on Perseverance Island.

On the inflation front, the Consumer Price Index

as reported by the National Statistics Bureau

remained quite stable with the average index for

the last 12 months rising by only 0.6 per cent

relative to the corresponding previous period.

Although no new major policy initiatives were

implemented by government to tackle the

prevailing weakness in certain critical economic

fundamentals, investor confidence in the country’s

future, as measured by the magnitude of FDI

flows, remained upbeat. According to external

accounts data, some R140 million net of such

flows entered the economy during the quarter,

largely in connection with the Four Seasons Petite

Anse Development, the Universal Silhouette

Resort and the Eden Island Project. With the

imminent commencement of other large hotels,

including the US$110 million Ephelia Resort at

Port Launay, all indications point to a record year

for FDIs in 2006.

With the ongoing strengthening in tourism supply

fundamentals, the Seychelles has made

commendable headway in satisfying a necessary

condition for a resumption of real economic

growth. However, exploiting this opportunity

requires a commensurate expansion in external

demand for these new upmarket tourism products.

With the intensity of international competition in

the hospitality industry, Seychelles has to compete

increasingly for its market share on a value for

money slate, rather than relying on brand values

alone. Thus, in large measure, and especially at

the margin, the country can no longer ignore the

need to be price-competitive in a highly price-

sensitive global market.

Cognisant of the above and in light of the

immediate external and internal threats facing the

economy, the Central Bank advocates that future

policies feature additional initiatives geared

specifically at enhancing external

competitiveness, raising labour productivity and

further improving the business environment.

Unless such a review is undertaken, there are

strong and immediate risks that the dynamics of

this overdue economic recovery phase could be

materially impaired in its incipient stage.


- III -

2. FINANCIAL SURVEY

2.1 Monetary Developments

2.1.1 Summary

The first quarter of the year was marked by a

decline in domestic liquidity as evidenced by a

contraction in the broad monetary aggregate

M2(p). This was an unexpected development in

light of a resurgence in domestic credit growth

and a significant improvement in the country’s net

foreign assets position. Within the statistical

framework of the monetary survey, the balancing

contra to the growth in banking sector assets was

reflected in an expansion in the non-monetary

liabilities (Other Items net) of the financial

system.

2.1.2 Credit

The quarter under review observed a contraction

in total gross credit contrary to the expansion

recorded in the previous quarter. The fall was by

R26 million (0.5 per cent) and was associated

mainly with a drop in credit from the Central

Bank whilst there was an slight increase from

commercial banks.

Total claims on the government moved from

R3,979 million to R3,992 million, representing a

growth of R13 million or 0.3 per cent (See Table

1). This development was associated with a rise

in credit to government from the commercial

banks, notably by R96 million. Correspondingly,

an increase of R31 million (or 10 per cent) in

credit to parastatals was reported, taking it to a

peak of R328 million.

Table 1 Credit;1 2004-2006

2 0 0 4 2 0 0 5 2006 Q3 Q4 Q1 Q2 Q3 Q4 Q1

(R million)

Total Credit 5450 5493 5577 5403 5324 5523 5498

Commercial banks 3808 4092 3989 4050 3971 4183 4240 Claims on private sector 1117 1162 1178 1181 1189 1247 1178 Claims on parastatal sector 142 183 252 298 259 297 328 Claims on government 2547 2747 2586 2571 2523 2639 2735

Central Bank 1642 1401 1588 1353 1353 1341 1258 Claims on government 1642 1401 1588 1353 1353 1341 1258 1 End-of-period data. Figures do not necessarily add up due to rounding. Source: Central Bank of Seychelles


- IV -

However, these upward movements were

completely neutralised by a R70 million (5.6 per

cent) drop in commercial banks claims on the

private sector whilst over the same period,

government reduced its liabilities with the Central

Bank by R83 million, or 6.2 per cent, to end the

quarter with an outstanding balance of R1,258

million. Overall, a decline of R26 million in gross

total credit (from R5,523 million to R5,498

million) was recorded in the first three months of

2006.

Net of government deposits, total credit peaked at

R5,233 million, representing a 0.2 per cent rise

over the end December level. This development

was mainly attributed to an increase in net claims

on government, which rose from R3,679 million

to R3,738 million.

Chart 1: Quarterly percentage change in domestic credit

-20

-10

0

10

20

30

40

50

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2 0 0 2 2 0 0 3 2 0 0 4 2 0 0 5 2006

Quarter

Perc

enta

ge

Total Credit Commercial Banks Central Bank

Source: Central Bank of Seychelles

2.1.3 Money Supply

Following a significant improvement of R105

million (38 per cent) in net foreign assets, and an

expansion in domestic credit, some instability and

upward pressure in the money supply could be

expected. However, in deference to expectations,

the broad monetary aggregate, M2(p), fell by R41

million or 0.9 per cent (See Table 2) over the first

quarter. Most of this decline was reflected in a

R35 million (7.1 per cent) drop in pipeline

deposits to R463 million.

Of the other M2(p) components, quasi money fell

by R11 million (or 0.5 per cent) on account of a

decline in time deposits, mostly of the private

sector which dropped by R68 million. By

comparison, parastatals time deposits fell by a

marginal R0.3 million. On the other hand,

savings and foreign currency deposits registered

growths of R41 million and R16 million

respectively, the latter associated with the

underlying recovery of the tourism sector.


- V -

Table 2 Monetary Survey;1 2004-2006

2 0 0 4 2 0 0 5 2006 Q3 Q4 Q1 Q2 Q3 Q4 Q1

(R million)

Foreign Assets, Net -404 -415 -475 -375 -300 -274 -169 Central Bank -343 -306 -315 -199 -144 -86 -52 Commercial Banks -62 -108 -160 -176 -156 -188 -117

Domestic Assets 5179 5202 5276 5134 5064 5223 5233 Claims on private sector 1118 1162 1151 1181 1189 1247 1178 Claims on parastatals 142 183 252 298 259 297 328 Claims on government, net 3919 3857 3874 3656 3617 3679 3728 Total Assets 4775 4788 4801 4759 4764 4950 5064

Money Supply, M2(p) 4290 4269 4215 4257 4227 4444 4403 Money Supply, M2 3671 3679 3659 3727 3697 3945 3940 Money, M1 1225 1227 1239 1251 1180 1400 1406 Currency with public 287 296 284 282 290 326 324 Demand deposits 938 931 955 969 890 1074 1082 of which: Private 656 647 688 700 690 809 808 Parastatals 283 284 267 269 200 265 274 Quasi-money 2446 2452 2420 2476 2517 2546 2534 Time deposits 1429 1421 1403 1440 1451 1453 1385 of which Private 1282 1269 1247 1283 1286 1292 1232 Parastatals 147 152 155 157 165 153 152 Savings deposits 807 806 831 834 839 848 889 Foreign currency deposits 210 226 186 201 227 245 260 Pipeline deposits 618 589 556 530 530 498 463 Other Items, net 485 519 587 502 537 506 6611 End-of-period data. Figures do not necessarily add up due to rounding. Source: Central Bank of Seychelles

Interestingly, the narrow money (M1) aggregate

did not follow the same downward path as M2(p).

At R1,406 million, it closed the quarter with an

increase of R6.2 million or 0.4 per cent over the

end- December 2005 position. Such movement in

M1 was mostly attributed to a rise in demand

deposits held by the parastatals which moved

from R265 million to R274 million.


- VI -

Chart 2: Percentage change in broadest money aggregate – M2(p)

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2

4

6

8

10

12

14


2 0 0 2 2 0 0 3 2 0 0 4 2 0 0 5 2006

Quarter

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Quarterly % Change Annual % Change


2.1.4 Deposits at Commercial Banks1

Compared to the previous quarter, there was a

slight decline in deposits held at the commercial

banks. The level of deposits fell by R3.0 million,

thus taking the stock to R3,838 million. Such

contraction was the net outcome of a decline of

R7.1 million (0.2 per cent) in private sector

deposits and another of R7.5 million (3.3 per cent)

in government deposits, partially offset by a rise

of R12 million in parastatal deposits.

Table 3 Commercial Bank Deposits;1 2004-2006

2 0 0 4 2 0 0 5 2006 Q3 Q4 Q1 Q2 Q3 Q4 Q1

(R million) Total deposits 3624 3659 3653 3667 3635 3841 3838 Private sector deposits 2940 2936 2941 3011 3035 3187 3179 Parastatal deposits 444 448 434 434 372 425 437 Government deposits 239 276 279 222 228 229 222 1 End-of-period data. Figures do not necessarily add up due to rounding.


____________________________________________________

1 This measure, which includes all deposits except those in the pipeline, is similar to M2; however, government deposits are excluded in the latter. Furthermore, currency with the public is an M2 component, but not part of “deposits at commercial banks”.


- VII -

2.1.5 Commercial Bank Liquidity

The movement in the credit-deposit liquidity

indicator showed a worsening in banks’ liquidity

position at the end of the quarter relative to the

previous three months (Table 4). This was

evidenced by an increase in the credit to deposit

ratio from 108.9 to 110.5, explained by a 1.4 per

cent expansion in credit and a 0.1 per cent decline

in deposits.

However, given that the liquidity indicator

measures an end of period position, it was not a

true portrayal of banks’ liquidity throughout the

period. In fact, the liquidity position of banks

probably improved in the quarter compared to the

previous three months. This was reflected in

banks’ oversubscription of government securities,

as well as the fact that no advances were

disbursed to commercial banks by the Central

Bank in the period under review (See Table 5).

Table 4 Liquidity Indicator of Commercial Banks;1 2004-2006

2 0 0 4 2 0 0 5 2006 Q3 Q4 Q1 Q2 Q3 Q4 Q1

(per cent) Credit/deposit ratio 105.1 111.8 109.2 110.4 109.2 108.9 110.5 1 End-of-period data. 2 This measure covers commercial banks’ deposits (inclusive of government but exclusive of pipeline) and total commercial banks claims except on the Central Bank.


Table 5 CBS Advances to Commercial banks; 2004-2006

2 0 0 4 2 0 0 5 2006 Q3 Q4 Q1 Q2 Q3 Q4 Q1

(R million) Advances 168.0 364.0 132.5 35.5 56.0 0.0 0.0 Repayments 299.0 244.0 242.5 45.5 56.0 0.0 0.0

Stock of credit1 0.0 120.0 10.0 0.0 0.0 0.0 0.0 1 End-of-period data.



- VIII -

2.1.6 Money Multiplier2

The implicit money multiplier indicates how

much money may ex-post be created in the

financial system from the injection of one

additional unit of reserve money. At the end of

the quarter under review, this indicator fell

slightly from 4.06 to 4.04. This movement was

the result of a decline in both the broad monetary

aggregate M2(p) and high powered money, with

the former falling slightly faster than the latter.

Whereas the fall in M2(p) was due to a fall in the

deposit liabilities of banks, the decline in high-

powered money was triggered by a drop in

currency with the public and banks’ reserves at

the Central Bank.

2.1.7 Interest Rates

Movements in interest rates in the period were

mostly on a downward trend. The rates of Interest

were higher than in the previous quarter on

instruments with a maturity of less than 7 days,

and those of more than twelve months. The

minimum savings rate which is set by the Central

Bank however remained unchanged at 2.50 per

cent. On the other hand, the average bank lending

rate fell by 0.06 percentage points.

The increase in deposits of less than 7 days was

by 0.04 percentage points whilst deposits in the

maturity bracket of more than 12 months moved

upwards by 0.05 percentage points. By contrasts,

there were declines in interest rates by 0.50, 0.63

and 0.30 percentage points on instruments in the

maturity bracket of ‘7 days to 3 months’, ‘3

months to 6 months’ and those of ‘6 to 12

months’ respectively.

Consistent with previous quarters, the average

treasury bill rate was again on the rise with an

increase of some 0.14 percentage points.

Table 6 Interest Rates;1 2004-2006

2 0 0 4 2 0 0 5 2006 Q3 Q4 Q1 Q2 Q3 Q4 Q1

(per cent)

Savings deposits rate 3.09 2.75 3.00 2.95 2.98 2.97 2.80

Time deposits rate < 7 days 1.69 1.78 1.89 1.85 1.89 2.01 2.05> 7 days ≤ 3 months 3.65 3.86 4.44 4.39 3.05 3.00 2.50> 3 months ≤ 6 months 3.53 4.13 3.44 2.92 3.13 3.35 2.72> 6 months ≤ 12 months 3.48 3.22 3.12 3.24 3.30 3.10 2.80> 12 months 3.01 3.01 3.01 3.01 3.01 2.95 3.00

Average lending rate 10.09 9.94 9.94 9.90 9.98 10.12 10.06Average treasury bill rate 2.48 3.21 3.24 3.33 3.35 3.44 3.581 Data are averages of monthly data compiled on an end-of-period basis.


_________________________________________

2 The broad money multiplier measures the ratio of M2(p) to high powered money. The latter is defined as the sum of currency with the public, cash reserves and banks’ reserves held at the Central Bank.


- IX -

3. GOVERNMENT FINANCE

3.1 Budget Performance

3.1.1 Summary

Government fiscal accounts recorded another

consecutive surplus for the first three months of

the year, which amounted to R10 million (See

Table 7). This surplus was the result of a

commendable performance in the authorities’

revenue balance, which completely compensated

for overruns on the expenditure side. Such

increase in revenue was mainly attributed to

strong inflows in terms of ‘dividends & interest’

and ‘fishing licence fees’.

The government’s expenditure for the first three

months of the year was however on the rise.

Overspending was recorded under all three

categories of expenditure, but most evidently

under capital outlays. In large measure, this was

explained by ongoing investments (e.g. housing

projects) initiated in 2005, whose effects have

dovetailed into the first quarter and which will

continue to have important expenditure

implications throughout the rest of the year.

Given the year’s budget overall target of R178

million, the government is expected to achieve an

aggregate surplus of R168 million for the

remainder of this year if it is to attain its target.

Chart 3: Change in Overall Balance 2002-2006

(500,000)

(400,000)

(300,000)

(200,000)

(100,000)

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100,000

200,000

300,000

400,000


2 0 0 2 2 0 0 3 2 0 0 4 2 0 0 5 2006

Quarters

R M

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(400)

(300)

(200)

(100)

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200

300

400

500

600

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Overall Balance % Change in Overall Balance

Source: Department of Finance


- X -

Table 7 Government Budget; 2005-2006

Summary 2005 2006 2006 2006 Q1 Q1 Q1 Actual1 Budget Actual1 Budget

Total Receipts 448 454 491 1929 Current receipts 448 453 490 1924 of which: Trades tax [71] [50] [51] [199] Transfers from Social Security Fund [31] [31] [31] [125] Business/income tax [65] [67] [59] [304] Other indirect taxes [163] [163] [161] [673] Of which GST on: Locally Manufactured Goods [60] [55] [53] [219] Services [52] [53] [52] [212] Imported Goods [34] [42] [39] [170]

Grants 0 1 2 5

Total Outlays 328 427 482 1751 Current outlays 313 396 409 1514 Appropriation items 281 350 343 1320 Of which: Ministries/departments [181] [215] [218] [836] Social Security contributions [36] [36] [39] [143] Current outlays to parastatals [8] [17] [17] [62] Charges 31 46 66 193 Of which: Interest payments [28] [40] [61] [179]

Capital outlays 10 31 73 237

Net lending 5 0 0 0 Of which: Parastatals [0] [0] [1] [0]

Primary Balance2 148 67 71 357

Overall Balance 120 27 10 178

Financing (net) -120 -27 -10 -178 Foreign loans (net) -1 0 -12 -2 Domestic loans (net) -63 -27 38 -176 Cash movements -56 0 -36 0 Figures do not necessarily add up due to rounding. 1 These are subject to audit and might be revised accordingly. 2 The primary balance is obtained by excluding interest payments from the overall balance.



- XI -

3.1.2 Revenue

Total revenue amounted to R491 million during

the first quarter of the year (See Chart 4). This

represented an 8.3 per cent rise over the budgeted

R454 million, and on a year on year basis, it

corresponded to an increase of 9.7 per cent. This

strong revenue performance was due to inflows of

R73 million and R72 million collected from ‘fees

& fines’ and ‘dividends & interest’ respectively.

With regards to the former, receipts from fishing

licence fees, amounting to R59 million, was

instrumental in driving the outcome. As for the

‘dividends & interest’ category, exceptional

payments of R31 million from ‘COSPROH’3

coupled with an additional R41 million transfer

from the Central Bank significantly contributed to

the positive result.

Continuing the established trend, revenue from

GST accounted for a large proportion of current

receipts. Such revenue over the first three months

of the year amounted to R161 million,

commendably high, but below budget and less

than the amount collected in the same period of

the previous year. An in-depth analysis of GST

reveals a mixed movement in revenue under its

sub-categories compared with the first quarter of

2005. Whilst collections from ‘locally

manufactured goods’ fell short due to lower

proceeds from alcohol following a downward

revision in the rate of GST, the revenue drop

under ‘services’ was in regard to a decline in

tourism GST. Of note is that in the first quarter of

2005, tourism GST included arrears payments that

were due in the preceding year.

Chart 4: Change in Revenue 2002-2006

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100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000


2 0 0 2 2 0 0 3 2 0 0 4 2 0 0 5 2006

Quarters

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-50

-40

-30

-20

-10

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30

40

50

60

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Total Receipts % Change in Total Receipts Source: Department of Finance

Besides GST, most other revenue heads

performed below target. The most remarkable

shortfalls were recorded under ‘miscellaneous

receipts’ and ‘rents & royalties’, both by R17

million. Other shortfalls were also recorded under

‘income/business tax’, ‘administration fees &

charges’ and ‘reimbursements’ category. In

aggregate, these amounted to R11 million.

________________________________ 3 Compagnie Seychelloise de Promotion Hôtelière Ltd.


- XII -

In spite of the underperformance relative to

budget registered under GST and

‘income/business tax’, revenue from taxes

continued to account for the largest segment of

current receipts, with a contribution of R302

million.

3.1.3 Expenditure

Despite its best efforts and in contrast to seasonal

norms, government swayed somewhat from a

prudent fiscal course during the first quarter. This

was evident under both current and capital

outlays, albeit more significantly in respect of the

latter, which recorded a twofold increase to stand

at R73 million. Capital expenditure exceeded its

planned limit for the quarter on account of certain

ongoing construction projects. Of notable

mention, are the new high security prison and the

Perseverance housing project, which took off in

2005 and are currently under construction. To a

smaller extent, the slippage in spending was

attributed to payments made out in respect of

‘land acquisitions’ (R4.1 million). However, it

should be noted that for the full year, with some

discipline, there is still significant scope that

capital outlays can be contained within its R237

million allocation.

In the other component of expenditure, notably

current outlays, an excess spending of R13

million (or 3.2 per cent) was recorded. Current

expenditure refers to government spending on

recurring items such as salaries, interests and

consumables. For the quarter, the predominant

overrun was in respect of public debt interest

payments, which exceeded projections by R21

million. The bulk of such payments went towards

servicing the 20–year government bond

subscribed by the Central Bank in March 2005. It

is to be recalled that this bond arose from the

securitisation of liabilities of R1,459 million due

to the Central Bank (of which R1,317 million was

in regard to outstanding advances and R84

million, in connection with the outstanding

balance on the R623 million zero per cent bond as

at December 31, 2004) into a new 20-year

treasury bond.

Table 8 Central Bank Credit to Government; 2004-2006

2 0 0 4 2 0 0 5 2006

Q3 Q4 Q1 Q2 Q3 Q4 Q1

(R million) Total Credit1 1642.3 1400.6 1588.1 1353.4 1353.4 1340.8 1257.5 Advances 1558.3 1316.6 129.1 0.0 0.0 0.0 0.0 Treasury bonds 84.0 84.0 1459.0 1353.4 1353.4 1340.8 1257.5 1 End-of-period data.


- XIII -

Additionally, a R10 million ex-gratia payment

made to Indian Ocean Tuna (IOT) Seychellois

employees in respect of a change in company

ownership influenced the outcome.

Encouragingly, however, savings under some

categories of expenditure were recorded. These

were in respect to ‘pensions & gratuities’,

‘centralised payments’ and ‘regulatory bodies’,

which in aggregate registered savings of R13

million.

As for net lending, the balance amounted to R0.2

million. In effect, this net outcome represented a

repayment of R1.3 million made under advances

to ‘others’, and an advance of R1.1 million made

out to parastatals. Advances under ‘others’

constitute those made under the head ‘general

purpose loans’ which are normally settled at year

end.

Overall, total expenditure was the highest

recorded with respect to a first quarter from 2002

to the present (See Chart 5).

Chart 5: Change in Expenditure 2002-2006

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200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000


2 0 0 2 2 0 0 3 2 0 0 4 2 0 0 5 2006

Quarters

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80

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Total Outlays % Change in Total Outlays


3.1.4 Financing

As with past trends, government financing in the

quarter came principally from the domestic

market. To this extent, net domestic loans totalled

R38 million, somewhat low compared to previous

borrowing patterns.

Borrowing from the foreign market was

significantly reduced from an anticipated R12

million to R0.1 million. On the repayment side,

amortisation of debt amounted to R12 million,

slightly less than the projected R13 million,

resulting in a net repayment of R12 million on

foreign loans. The remaining gap in financing

was closed by a R36 million movement in cash

balances.


- XIV -

4. REAL SECTOR

4. Summary

The first quarter of the year 2006 may have

resulted in a moderation of economic activity in

most sectors as aggregate demand tends to be in

seasonal trough relative to the preceding festive

quarter. Drops in output were in the areas of retail

trade and some manufacturing lines. On a

brighter note, statistics from the tourism industry

confirmed an encouraging performance in the

quarter, both in terms of arrivals as well as the

amount of foreign exchange collected in the

banking sector.

On the investment front, activity, notably in the

hotel industry, continued at a strong pace,

reflecting a high degree of external confidence in

the future of the tourism sector. Most of the new

investments were in respect of foreign direct

investments (FDI) and in the form of equity

capital. In addition, the privatisation of the

government-own insurance company (State

Assurance Cooperation of Seychelles, SACOS)

attracted interests from a foreign investor.

In the labour market, the situation was somewhat

stable. On the inflation front, prices as measured

by the Consumer Price Index (CPI) showed

further moderation in the average rate.

4.1 Tourism

For the year 2006, figures as published by the

National Statistics Bureau (NSB) showed that a

total of 35,685 tourists visited the country in the

period of January to March. This represented an

increase of 2,661 visitors (8.1 per cent) compared

to the same period of 2005 and was the highest

first quarterly figure since 2003.

Chart 6: Visitor Arrivals

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

Q1Q2Q3 Q4Q1 Q2Q3Q4 Q1Q2 Q3Q4Q1 Q2Q3Q4 Q1Q2 Q3Q4Q1

2001 2002 2003 2004 2005 2006

Quarters

Num

ber o

f Arr

ival

s

-30.0

-20.0

-10.0

0.0

10.0

20.0

30.0

Perc

enta

ge

Tourist Arrivals Percentage change

Source: National Statistics Bureau


- XV -

The majority of tourists originated from the

European continent, which during the period

supplied 84 per cent of total visitors. In terms of

numbers, European tourists amounted to 29,999

visitors, some 2,783 (or 10 per cent) higher than

in the same period of 2005. The rise was mostly

associated with improvements in the number of

French tourists (from 7,442 to 8,553), followed

closely by visitors from Italy where an increase

from 4,318 to 5,347 was posted. The only drops

in European visitors were from 4,029 to 3,315 and

1,115 to 970 from UK & Eire, and Switzerland

respectively. France maintained its position at the

top of the market, supplying 24 per cent of

tourists to the country. As for the other

continents, a growth by 54 visitors (3.0 per cent)

was recorded from Asia whilst tourists from the

remaining continents were less than the numbers

registered in the first quarter of 2005.

Consistent with the positive arrivals figure, total

foreign exchange inflows from tourism-related

activities as recorded through the banking system

grew to R180 million or by 7.0 per cent relative to

the same period of the previous year. However, it

is worth noting that in light of imbalances in

supply and demand, significant leakages of hard

currencies to the parallel market continued to take

place. Adjusting for such leakages, the Bank

estimates actual tourism inflows at R305 million

for the quarter.

On the same accrual basis, the average

expenditure per diem per visitor is estimated to

have increased by 6.8 per cent compared to the

first quarter of 2005.

Chart 7: Tourism Income

0.0

50.0

100.0

150.0

200.0

250.0

300.0

350.0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2003 2004 2005 2006

Quarters

R M

illio

n

-10.0

-5.0

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

Per

cent

age

Tourism Income Percentage change


4.2 Unemployment

In the labour market, the number of job seekers

rose from an average of 1,521 in the period

October to December 2005 to 1,774 for the first

three months of 2006. Correspondingly, the

unemployment rate moved from 3.7 per cent at

the end of December 2005 to 3.9 per cent at the

end of the quarter under review. Such movement

reflects mainly the number of new school leavers

entering the labour market at the start of the year.


- XVI -

4.3 Price development

As expected, the quarter observed no major

movement in prices as covered by the official

Consumer Price Index (CPI). This measure of

inflation as reported by the National Statistics

Bureau (NSB) points to an average rate of 0.6 per

cent for the 12-months ending March 2006.

Chart 8: 12-months average inflation rate

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2001 2002 2003 2004 2005 2006

Quarters

Per

cent

age

Source: National Statistics Bureau As observed in the previous quarter, prices for the

first three months of 2006 were in general on a

declining trend. The average quarterly CPI

showed a rate of negative 0.8 per cent. This was

triggered by a decline of 2.1 per cent in the prices

of one of the three main components, namely

‘non-food items’. However, the consensus today

is that the weights of the various components of

the current CPI may not accurately capture the

cost of living in the country as they are based

from a survey done over a few years ago.

Accordingly, the National Statistics Bureau has

announced its intention to conduct a new

consumer expenditure survey in the next quarter.

Table 9 Consumer Price Index 1; 2004-2006

2004 2 0 0 5 2006 Q4 Q1 Q2 Q3 Q4 Q1 (per cent)

Quarterly average2 0.0 0.8 0.4 0.6 -1.0 -0.8 Annual average3 3.9 2.2 0.9 0.9 0.9 0.6


1 Our readers are advised that the inflation figures previously reported as Retail Price Index was a misnomer. 2 Percentage change with respect to previous quarter. 3 Percentage change with respect to same period previous year.


- XVII -

5. EXTERNAL SECTOR4 5.1 Summary

For the first quarter of 2006, the provisional

Balance of Payments (BOP) estimates showed an

overall surplus of R10 million. This was an

improvement over the fourth quarter of the

previous year but compared less favourably with

the overall surplus balance of R85 million in the

first quarter of 2005.

For its part, the current account deficit expanded

by 67 per cent from R41 million in the first

quarter of 2005 to R69 million. The widened

current account balance was mainly associated

with the increase in net imports which exceeded

the significant growth in net inward current

transfers. With regards to the ‘capital and

financial account’, this showed a surplus but at a

reduced magnitude compared to the preceding

four quarters.

At the end of the March 2006, gross external reserves, which comprise those of the Central Bank and government, posted an improved outcome compared to their December 2005 position. Likewise, on a net basis, the net foreign assets position moved from negative R274 million at the end of the previous quarter to negative R169 million. Notwithstanding this improvement, the period also saw further accumulation of payment arrears.

During the quarter, the Central Bank continued to

monitor external developments very closely. A

major policy announcement was made in the early

part of the year, namely the commitment of

government to fast-track the liberalisation of the

foreign exchange market in order to facilitate

investment and commerce. This implies a

fundamental review of the prevailing

macroeconomic framework.

In the meantime, however, in light of other

immediate policy considerations, the existing

exchange rate regime remained in force. Hence,

the domestic currency continued its peg to the

Seychelles Trade and Tourism Weighted Basket

(STTWB) of currencies and the R5.50/US$

appreciation ceiling on the value of the rupee per

unit of US dollar was maintained. In terms of

movements – excluding its value against the US

dollar – the domestic currency weakened relative

to all of the remaining five currencies in the

basket when compared to its average value of the

previous quarter; this was the first general

weakening of the rupee over four consecutive

quarters. The margin of the depreciation was

between 0.2 per cent (UK sterling and the

Japanese yen) and 6.3 per cent (South African

rand).

5.2 Current account

As mentioned above, the quarter under review

recorded an expansion in the current account

deficit outcome compared to the same period of

the previous year. This was from R41 million to

R69 million. Such movement was substantively

__________________________________ 4 Our readers are advised that as of this quarter, analysis of the external sector is done based on the outcome of the Balance of Payments compiled on an accrual accounting concept. Prior to that, analysis in this section was done using the Exchange Record, which measured external sector transactions on a cash basis.


- XVIII -

Table 10 External Account Balance1; 2005-2006

2 0 0 5 2005 2006 Q1 Q2 Q3 Q4 Annual Q1

(R million)

Current Account -41 -377 -444 -214 -1075 -69Goods and Services, net 4 -367 -443 -220 -1026 -98Goods, net -211 -487 -586 -363 -1646 -301Merchandise Trade, net -329 -613 -749 -578 -2270 -539Credit (of which) 451 464 470 545 1930 560 Merchandise exports (f.o.b.) 295 301 275 294 1165 262Debits (of which) 661 951 1056 908 3576 861 Merchandise imports (f.o.b.) 624 914 1024 873 3435 801Services 215 119 143 143 620 203Credits (of which) 532 458 508 530 2028 574 Tourism earnings 263 253 259 276 1051 305 Debits 317 339 365 388 1408 371Income -61 -56 -46 -58 -220 -56 Compensation of employees -8 -9 -8 -7 -32 -11 Credit 0 0 0 0 1 0 Debit 8 9 8 7 33 11Investment income -53 -47 -38 -51 -189 -45 Credits 11 14 13 15 53 13 Debits 63 61 51 66 242 58Current transfers 15 46 45 65 172 85General government 12 24 30 61 128 81 Credits 13 25 30 62 130 81 Fishing licence fees 6 12 18 16 52 35 Overseas grants 7 13 12 45 77 46 Debits 0 0 0 0 2 0Other sectors 3 22 15 3 44 4 Credits 7 26 20 13 66 7 Debits 4 4 5 10 22 3CAPITAL AND FINANCIAL ACCOUNT 152 395 309 122 978 87

CAPITAL ACCOUNT 2 16 110 37 164 3FINANCIAL ACCOUNT 151 378 199 86 813 84Direct investment 105 96 112 119 431 140Abroad 13 10 9 9 41 14In Seychelles 118 107 121 128 472 154

Portfolio investment 2 1 1 1 6 2 Assets 0 0 0 0 0 0Liabilities 2 1 1 1 6 2Other investment 44 281 86 -34 376 -58 Assets 7 15 8 23 53 -6Liabilities 51 295 94 -11 429 -53Net errors and omissions -26 -2 29 12 13 -8

OVERALL BALANCE 85 16 -106 -80 -84 10

Financing of overall balance -85 -16 106 80 84 -10 Reserve assets -42 -13 -35 -31 -121 -24Arrears -43 -3 141 111 205 14Memorandum items: Stock of Reserves (Gross)(R million) 229 242 278 309 309 333

1 Figures do not necessarily add up due to rounding. Source: Central Bank of Seychelles


- XIX -

underpinned by an increase in the trade deficit

which overshadowed the remarkable increase in

the balance under current transfers from R15

million to R85 million.

5.2.1 Goods Account

On account of the country’s heavy dependence on

imports in order to meet the daily private and

business demand across all sectors of the

economy – including for re-exports purposes – the

Seychelles’ goods account stands invariably in

deficit. In the first quarter of 2006, the magnitude

of such deficit was R301 million, compared to

R211 million registered in the corresponding

period of the previous year.

For its part, the trade balance showed a worsened

outcome following a contraction in exports and an

increase in imports. Exports (f.o.b.) of

merchandise for the quarter are estimated at R262

million showing a drop of 11 per cent compared

to the same period a year ago. The lion’s share of

exports, just over 85 per cent, continued to be

represented by canned tuna from the Indian Ocean

Tuna (IOT) canning factory, the country’s largest

single manufacturing and exporting entity.

With regards to merchandise imports (f.o.b.), the

provisional estimate of R801 million represented

an increase of R177 million or 28 per cent when

compared to the corresponding period of the

previous year. Of this total, 29 per cent

constituted imports of mineral fuel, the latter of

which increased by a significant 67 per cent in

relation to the corresponding period of the

preceding year. Aside from the steady rise in

domestic consumption, the growth in the

country’s mineral fuel imports was attributed to

the increase in the international price of oil.

Excluding fuel, the rise in merchandise imports

was also influenced by the reduction in trades tax

on a wide range of commodities (effective

December 2005) and the import demand

generated by new investment projects (mainly

tourism-related). The latter was of course fully

covered by corresponding FDI inflows.

5.2.2 Services

From a national output perspective, the services

sector is of critical importance to the Seychelles

economy. The country’s principal industry is

tourism and foreign exchange inflows from

tourism have traditionally caused the services

account to be in considerable surplus. For the

quarter under review, this surplus amounted to

R203 million, representing a R12 million (5.6 per

cent) contraction in the net inflow relative to the

first quarter of 2005. Compared to the fourth

quarter of last year, this however represented an

increased balance.

On the credit side, the account showed a growth

of R42 million (7.9 per cent) relative to the same

period of the previous year. For its part, tourism

earnings (including an adjustment to leakages

outside the formal banking system) grew by 16

per cent, compared to the first quarter of 2005, a

result which is partly explained by the 8.1 per cent

increase in visitor arrivals over that same period.

On the debit side, the outcome showed a growth

of R54 million (17 per cent) in payments. This

represented an increase under the entries such as

freight payments, associated with the higher


- XX -

import value, and debit entries (such as purchased

of outward tickets on foreign airlines by residents,

cost of holidays abroad) relating to a 10 per cent

increase in the number of residents who travelled

abroad compared to the same period a year ago.

5.2.3 Current Transfers

As is the norm for a typical developing country,

the transfers’ account of Seychelles is traditionally

in surplus, indicating that inward transfers to the

economy exceed those transferred to the rest of

the world. Such a trend was maintained in the

first three months of 2006. The bulk of inward

transfers represented that from the European

Union (EU) amounting to R59 million, which

mainly included earnings under the head ‘fishing

licence fees’, representing inflows as per the

country’s fishing agreement with the EU.

Compared to the same period of 2005, EU fishing

licence fees’ contribution increased to a

significant R35 million. Excluding such fees,

inflows under ‘overseas grants’ stood at R46

million against a mere R6.9 million posted in the

first quarter of 2005. Consequently, for the period

under review, net inward transfers increased from

R15 million to R85 million.

5.3 Capital and Financial Account 5.3.1 Capital Account The capital account records capital transfers to the domestic economy, which are mainly from bilateral and multilateral donors. For the first three months of 2006, capital inflows are estimated at R3.4 million, remaining somewhat stable relative to the same period of the previous year. Of note is that for the remainder of this year, such transfers are expected to be lower than that of the previous year’s donations to the

country which rose above normal in the aftermath of the tsunami and flash floods experienced by the country in December 2004. 5.3.2 Financial Account In the first quarter of 2006, the financial account posted a surplus as was the case in the first quarter of 2005. Nevertheless, the surplus for the period under review was a lower R87 million compared to R152 million in corresponding quarter a year ago. Two of the account’s main sub-accounts namely, ‘direct investment’ and ‘portfolio investment’ accounted for the surplus; under the sub-account ‘other investment’, a net outflow is estimated. The net inflows under ‘direct investment’ for the quarter amounted to R140 million. Whilst investments abroad by residents remained somewhat stable at an estimated R14 million, inward investments amounted to R154 million, representing an increase of R36 million (31 per cent) compared to R118 million recorded in the first quarter of 2005. As indicated earlier, part of the foreign direct investments in 2005 represented renovation works to some tourism establishments hit by the December 2004 tsunami. For the year ahead, taking into consideration the considerable numbers of hotel projects in the planning phase, FDI inflows are expected to increase further during the year, possibly to an annual record level. As for the remaining two sub-accounts, the balance under ‘portfolio’ investment showed a surplus of R1.8 million whereas that under ‘other investment’, a deficit of R58 million compared with a surplus of R44 million registered in the first quarter of 2005. The shift from a surplus to a deficit was associated with a loan of US$20 million drawn in March 2005 whilst in the period


- XXI -

under review the shortfall indicated a net reduction in the country’s external debt in the absence of no new substantial drawdown. 5.4 Reserves

The quarter under review witnessed a further

improvement in the country’s official reserves

position. At the end of March, gross official

reserves, which comprise of Central Bank and

government reserves, stood at R334 million

(US$61 million). At the end of December 2005,

such reserves amounted to R309 million (US$56

million).

In terms of import cover, gross official reserves

for the quarter under review were equivalent to

4.2 weeks of 2005’s c.i.f. estimated annual import

value.

5.5 Exchange rates

There was no change in the exchange rate regime

in the first quarter of 2006. As such, the domestic

currency remained pegged to the Seychelles Trade

and Tourism Weighted Basket (STTWB) of

currencies. In line with the Macroeconomic

Reform Programme of July 1, 2003, the

appreciation limit of 5.50 in domestic currency

per unit of US dollar, irrespective of the

movements in the value of the US dollar in the

international market, continued to be respected.

Under the above policy rule, the external value of

the rupee remained constant at 5.5 per unit of US

dollar throughout the quarter. However,

movement against the other world’s major

currencies showed a general weakening in the

value of the domestic currency for the first time in

four consecutive quarters. Relative to the

currencies in the STTWB, the margin of the

depreciation was within the range 0.2 per cent and

6.3 per cent.

The 0.2 per cent weakening of the Seychelles

rupee was against two currencies in the STTWB,

namely; the UK sterling and the Japanese yen.

The (maximum) depreciation of 6.3 per cent was

relative to the South African rand. Additionally,

the domestic currency also weakened 3.8 per cent

and 1.1 per cent against the Singapore dollar and

euro respectively.

Measured against its average value for the first

quarter of 2005, the domestic currency weakened

by 0.5 per cent against the Singapore dollar but

appreciated relative to most major currencies.

The maximum gain in strength relative to

currencies in the STTWB was 11 per cent against

the Japanese yen. Other gains were: 8.3 per cent

to the euro, 7.3 per cent against the UK sterling

and 2.5 per cent relative to the South African

rand.

OPERATIONS AND ADMINISTRATION

OF THE CENTRAL BANK

First Quarter, 2006

The year 2006 marks the second year that the

Central Bank operates as an autonomous

institution under the Central Bank Act 2004.

In its initial year, management directed

resources to capacity building and to internal

restructuring in order to be in a position to

effectively discharge its statutory obligations.

From a public perspective, the impression

might have been of a sense of inactivity,

notably on the monetary policy side, as the

Bank pursued its re-organisation programme.

This could not be further from reality as

throughout this formative year, a thorough

reassessment of macroeconomic policy

continued to be made, engaging at all times,

key partners and economic stakeholders.

During its various policy deliberations, the

Central Bank has consistently called for the

adoption of a balanced and consistent

macroeconomic framework to guide and

facilitate economic adjustments, one in which

monetary policy can play an effective role at

equilibrating the money market and supporting

the external accounts. Under the prevailing

Macroeconomic Reform Programme launched

in July 2003, monetary policy was assigned a

supportive role, that of administratively

keeping the costs of government borrowings at

low levels in order to assist fiscal

consolidation. Experience of the recent past

has now clearly shown that in pursuing such a

policy, monetary fundamentals have been

seriously impaired, resulting in an erosion of

confidence in the sovereign currency as a store

of value and increasing the tendency to shift

into foreign reserve assets, invariably at a high

premium on the parallel market. Hence whilst

progress was being painstakingly made in the

attainment of internal balance, through the

fiscal route, the results were far from evident

on the external front, thus frustrating the

overall macroeconomic adjustment effort.

However, whilst there is consensus that

monetary policy needs to adopt an

independent stance, the shift in position, needs

to be cautiously orchestrated as any

- XXII -

Quarterly Review Operations and Administration of the Central Bank, Q1, 2006

- XXIII -

independent tightening in monetary policy will

neither be effective nor credible unless

implemented within a rational and balanced

overall macroeconomic plan. In a substantive

sense, the major bottleneck to a successful

realignment of monetary – and external -

policies is the high risks such a move

obviously carries to fiscal consolidation in

light of the prevailing high level of domestic

and external official indebtedness. It is

therefore of pragmatic and prudent necessity

that any future macroeconomic policy

programme should carefully weigh such risks

and implemented in a structured and phased

manner with the least possible costs to social

cohesion and welfare.

During the quarter, the Central Bank also

committed considerable resources in pursuit of

its regulatory function. After months of

deliberations, the Bank completed work on an

upgraded piece of financial legislation,

resulting in the enactment of the new Anti-

Money Laundering Act, 2006. The new law

repealed the previous legislation which came

into effect in 1996 and brings the Seychelles in

line with international standards and best

practices in detecting - and dealing with -

illegal financial activities. Within the ambit of

the new Act, a Financial Intelligence Unit

(FIU) will be set up to extend the regulatory

capability of the Central Bank.

From a Divisional perspective, the Bank

continued to develop its core functions.

During the quarter, the Administration and

Human Resources Division achieved further

progress in the Bank’s plan of internal

capacity building. The third phase of the

Bank’s Executive Development Programme

(EDP), being organised jointly with the

Department of Finance and assisted by the

Seychelles Institute of Management, was

launched. This programme is aimed at

enhancing the knowledge of staff on different

subjects pertinent to the Bank and Department

of Finance. The target group is mainly the

cohort of young graduates working in key

positions at the technical level. The

programme aims to increase the confidence of

the staff consistent with their position of

responsibility and their need to interact

professionally with external agencies.

With the enactment of the new Anti-Money

Laundering Act, further enhanced training in

this field will be conducted both for the

Central Bank staff as well as all other agencies

involved with the effective implementation of

this legislation. During the quarter, the Bank’s

staff also received training in International

Accounting and Auditing of Banks and

Compilation of Monetary and Financial

Statistics.

Early during the year, preparatory work in

connection with the revival of the Bank’s

Anniversary Lecture series was initiated. This

year’s Lecture, which focuses on the tourism

industry, will be entitled “Tourism: Marketing

Seychelles – A View from Abroad” and be held

in mid-May. The Central Bank approached

the World Tourism Organisation (UNWTO)

for a suitable speaker, and Dr Michael

Fabricius, was nominated by the institution. A

committee comprising of staff from the


- XXIV -

Administration and Human Resources and

Research and Information Management

Divisions has the overall responsibility of

organising and co-ordinating the event.

Two other functions that were active over the

quarter were the Clearing House and the

management of public debt. The former,

falling under the responsibility of Banking

Services Division, observed an increase in the

value of items cleared even though the actual

number of items exchanged declined relative

to the previous quarter. Since, the inception of

the Clearing House in 1980, the quarter under

review recorded the highest figure on record in

terms of value of cleared effects.

Table 11 Bankers’ Clearing House Activities

Daily Averages End of Period

Number of Clearing

items

Amount (R’000)

Number of days

Number of clearing

items

Amount (R’000)

2005 Quarter 1 140,990 476,814 62 2,274 7,691 Quarter 2 143,203 628,545 62 2,310 10,138 Quarter 3 150,929 625,164 65 2,322 9,618 Quarter 4 152,430 462,101 62 2,459 7,453

2006 Quarter 1 143,786 703,428 63 2,282 11,166

2005 April 47,432 211,072 21 2,259 10,051 May 48,486 200,680 21 2,309 9,556 June 47,285 216,792 20 2,364 10,840 July 49,220 193,801 21 2,344 9,229 August 52,441 205,696 22 2,384 9,350 September 49,268 225,666 22 2,239 10,258 October 49,619 183,364 21 2,363 8,732 November 51,201 145,905 21 2,438 6,948 December 51,610 132,832 20 2,581 6,642

2006 Jan 46,425 223,280 20 2,321 11,164 Feb 45,434 221,107 20 2,272 11,055 Mar 51,927 259,041 23 2,258 11,263

Notes: Bankers’ Clearing House is managed by the Central Bank under the Clearing House Agreement signed by the Central Bank and six commercial banks in September 1980. Clearing commenced on October 1, 1980.

In the first three months, the Public Debt

Division maintained its role as manager of

government debt. The main instruments on

offer were treasury bills and treasury bonds.

There were two issues of treasury bills

conducted in the first two months and these

represented roll-overs of maturities falling due

in these respective months. Given the


- XXV -

conditions in the market, the resulting average

yield on these instruments for the quarter

remained relatively stable compared to the last

quarter of 2005 but rose by 34 basis points

relative to the same period a year ago (Table

12). The stock outstanding rose slightly

relative to December 2005 period but declined

relative to the end of the same period in 2005.

Table 12

Treasury Bills; 2005-2006

2 0 0 5 2006 2 0 0 6 Q1 Q2 Q3 Q4 Q1 Jan. Feb. Mar

(per cent) Annual yield (average)1 3.210 3.338 3.355 3.443 3.580 3.602 3.568 3.568 91-day bills (tender) 2.585 2.841 2.875 2.915 2.920 2.965 2.898 2.898 365-day bills (tender) 3.835 3.835 3.835 3.970 4.239 4.239 4.239 4.239

(R million) Amount issued2 1223.3 1201.9 1163.4 1336.7 1171.1 376.7 794.4 0.0 91-day bills (tender) 1223.3 1201.9 1163.4 1144.8 1171.1 376.7 794.4 0.0 365-day bills (tender) 0.0 0.0 0.0 191.9 0.0 0.0. 0.0 0.0 Stock outstanding2/3/ 1415.9 1394.5 1356.0 1336.7 1362.9 1362.7 1362.9 1362.9 91-day bills (tender) 1223.3 1201.9 1163.4 1144.8 1171.1 1170.8 1171.1 1171.1 365-day bills (tender) 192.6 192.6 192.6 191.9 191.9 191.9 191.9 191.9

1 Quarterly data are averages of monthly data, compiled on an end-of-period basis. 2 At cost value. 3 End-of-period data. Note: With effect from January 2004 and December 2004, there were re-introductions of tender for 91-day and 365-day bills respectively.

In the bond market, there was no significant

movement in the outstanding stock. No new

issues of this instrument were put on offer

over the quarter. This was because some

existing bond issues, whose subscription limits

have not yet been reached, remained on offer.

Even though at a lower level compared to the

previous three months, a total of R39 million

worth of bonds was sold with the main

subscribers being individuals and non-bank

financial institutions (Table 13).


- XXVI -

Table 13

Treasury Bonds; 2005-2006

2 0 0 5 2006 2 0 0 6 Q1 Q2 Q3 Q4 Q1 Jan. Feb. Mar.

(R million) Amount sold 15.8 12.0 13.3 96.8 38.9 8.8 4.7 25.4 4%, 3-yr 8.5 0.7 0.4 7.2 31.1 8.1 0.0 23.0 8.0%, 10-yr 7.3 2.7 1.3 86.4 2.0 0.0 1.7 0.2 8.25%, Esmeralda II - 8.6 11.6 3.2 5.8 0.7 2.9 2.2 Stock outstanding1 1689.9 1675.8 1689.0 1765.5 1804.5 1774.5 1779.1 1804.5 2.25%, 1-yr - - - - - - - - 4%, 3-yr 788.5 789.2 789.6 776.7 807.8 784.8 784.8 807.8 5%, 5-yr 500.0 490.9 490.9 490.9 490.9 490.9 490.9 490.9 7%, 7-yr 200.0 183.0 183.0 183.0 183.0 183.0 183.0 183.0 8%, 10-yr 201.4 204.1 205.3 291.5 293.5 291.6 293.3 293.5 8.25%, Esmeralda II - 8.6 20.2 23.4 29.3 24.2 27.1 29.3

1 End-of-period data. Note: With effect from July 2003 there were new issues of bonds: 2.25%,1-yr; 4%, 3-yr;5%, 5-yr; 7%, 7-yr; and 8%, 10-yr. With effect from June 2005 there was the issue of a new Esmeralda II bond yielding 8.25%.

For government stocks, no new anticipated

issues are being foreseen in this current year.

As such the outstanding stock at the end of last

year was carried forward into the new year,

standing at R150 million.

Table 14

Government Stocks; 2005-2006

2 0 0 5 2006 2 0 0 6 Q1 Q2 Q3 Q4 Q1 Jan. Feb. Mar.

(R million) Stock outstanding1 150.0 150.0 150.0 150.0 150.0 150.0 150.0 150.0 8.50%, 2005/07 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0 8.00%, 2009 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0 8.00%, 2014 70.0 70.0 70.0 70.0 70.0 70.0 70.0 70.0

1 End-of-period data.

The Fisheries Industry of the Seychelles: At a Crossroad

Part 1: A Review of the Seychelles Fisheries Sector

Abstract

‘Fisheries’ may rightly be stated to be the only significant natural resource of the Seychelles. Over

the past 30 years, the sector has metamorphosed from a mostly subsistence activity to a major

processing and export industry, based on the exploitation of pelagic species (tuna) in the South-West

Indian Ocean. Today, the fisheries sector has become an integral and fundamental part of the social

and economic structure of the country. Alongside tourism, it constitutes a pillar of the economy and

one on which the country’s growth prospects depends critically upon.

In some ways, the industry is now at an important turning point. After two decades of steady

progress, during which period it has firmly established itself as an important economic catalyst and

source of foreign exchange, the industry now faces the emergence of regional competition. Thanks to

its strategic geographical position at the epicentre of the tuna fishing grounds, the country is by

location, the natural port of base for the tuna fishing fleet in the South-West Indian Ocean. In the

formative years, the tuna business was in regional terms, relatively small and unimportant and as

such, the industry was able to develop in a virtually competition-free environment.

Today, the tuna industry has grown into a multi-billion rupee activity and new aggressive competitors

are now emerging to capture part of the business. Seychelles now sees itself re-assessing its

competitive position and strategic vision in order to retain its position as the Primary Tuna Fishing

Port in the region. This study, comprising of two papers, is an attempt by the authors to provide an

insightful view of the industry as it has developed, its economic significance to the country, its

comparative advantages and weaknesses and the competitive threats it currently faces from regional

jurisdictions.

by

Moyra ALEXIS and Alain CHANG-SAM1

March 2006

1 Ms. Alexis and Mr. Chang-Sam are both economists at the Central Bank of Seychelles.

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TABLE OF CONTENTS

1.0 INTRODUCTION 1

2.0 STRUCTURE OF THE FISHERIES SECTOR 3

2.1 Legal framework 3

2.2 Management and administration of the sector 3

2.3 International fishery relations 4

3.0 FISHERIES ACTIVITIES 6

3.1 Artisanal 6

3.2 Semi Industrial 8

3.3 Aquaculture 9

3.4 Industrial Tuna Fishing 11

3.5 Processing and Exporting Plants 13

4.0 ECONOMIC CONTRIBUTION OF THE FISHERIES SECTOR 15

4.1 Employment 16

4.2 Fish Consumption and Fish prices 17

4.3 Production of the Fisheries Sector 18

4.4 Foreign Exchange Earnings 22

5.0 CONCLUSION 28

REFERENCES 29

APPENDICES 30

List of Acronyms

SMB Seychelles Marketing Board

SFA Seychelles Fisheries Authority

IOT Indian Ocean Tuna Ltd

IOTC Indian Ocean Tuna Commission

EEZ Exclusive Economic Zone

FAO Food and Agriculture Organisation

EU European Union

MT Metric Tonnes

AT Association Thonier

FCR Feed Conversion Ratio

PL Post Larvae

CITES Convention on International Trade and Endangered Species

CPUE Catch Per Unit Effort

SEYCOM Seychelles National Commodity Company

GDP Gross Domestic Product

FAD Fish Aggregating Device

NA National Accounts

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The Fisheries Industry of the Seychelles: At a Crossroad Part1: A review of the Seychelles Fisheries Sector

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1.0 INTRODUCTION

The Seychelles archipelago is made up of 115 named islands dispersed over a 1200-kilometre expanse

of the Western Indian Ocean just south of the equator, with the territorial sea and exclusive economic

zone extending over some 800,000 square kilometres of ocean, including significant areas of the

region’s continental shelf (the Mahé Plateau is the largest at 38,690 square kilometres).

Consequently, fisheries have always played a vital role in the economy of the Seychelles. Over the

past 20 years, with the emergence of Port Victoria as the most important tuna-transshipment port of

the region, and the establishment of the Indian Ocean Tuna (IOT) factory, one of the largest tuna

canning plants in the world, the industry has matured beyond recognition. Today, fisheries have

become an economic lynchpin, measured on any criterion, be it output growth, direct/indirect

employment, downstream sectoral linkages, or even in terms of technological advancement.

The long-term policy objectives of the Government of Seychelles for the fishing industry have been to

promote sustainable fisheries development and optimise the benefits from the fisheries sector for the

present and future generations. The policy statement focuses on the following objectives:

• To promote the conservation and management of marine resources to ensure the long-term

viability of the industry;

• To generate the maximum amount of employment;

• To maximize revenue from fisheries and related activities;

• To maximize foreign exchange earnings;

• To promote the maximum linkage with the sectors;

• To promote safety at sea;

• To maintain Port Victoria as the major tuna landing and transhipment port in the Western

Indian Ocean.

This paper and the one that will subsequently follow, are an attempt to provide an in-depth assessment

of the fisheries industry of the country; in a nutshell, their purpose is to review the current state of the

industry, analyse its strengths and weaknesses, assess future growth prospects, identify new

opportunities and highlight the threats and constraints ahead.

This first paper is organised as follows. Section 2.0 details the structure of the fisheries sector,

delving into the management and administration of the industry and briefly examines the legal

framework that governs it. Section 3.0 looks at the fisheries activities that take place and the

processing of fish products. Section 4.0 quantifies the contribution of the sector to the economy in


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terms of output, income and employment. Finally, Section 5.0 summarises the challenges ahead and

concludes Part I of the study.

2.0 STRUCTURE OF THE FISHERIES SECTOR

2.1 The legal framework

There are various pieces of legislation governing fisheries and its related activities in the Seychelles.

Firstly there is the Maritime Zone Act (1977) which declared Seychelles as a sovereign state and

established the Seychelles Exclusive Economic zone (EEZ), as well as demarcating the baselines, the

continental self and the territorial waters. In 1999, this act was repealed and a new one Maritime

Zone Act (1999) was enacted.

The Seychelles Fishing Authority (Establishment) Act (1984) was approved in 1984 which

provided for the set up of the Seychelles Fishing Authority (SFA). In 1987 the Fisheries Act (1987)

was passed. This Act defines all the fisheries regulation concerning both local and foreign fishery. It

established the major fisheries management measures, the fishing licensing procedures and fines for

breaches of the license regulations. In that same year, the Licences (Fisheries) Regulations (1987)

was approved. This defines the various categories of fisheries licence, the conditions of the licence

and the various fees for both local and foreign licences.

2.2 Management and administration of the sector

The Ministry of Environment and Natural Resources is the body responsible for all fisheries-related

matters in Seychelles. The Ministry sets all policy guidelines, which are then implemented by SFA,

in its capacity as the Executive Agency. As mentioned above, the SFA was established in 1984 under

the Seychelles Fishing Authority (Establishment) Act (1984), at a time of rapid development in the

fisheries sector, especially in foreign industrial tuna fishing. The aim behind its creation was to

ensure that the fishing industry develops to the fullest of potential whilst maintaining biomass

sustainability. Under the act, the main functions of SFA are as follows:

• To promote, organize and develop fishing industries and fisheries resources in Seychelles;

• To assist in the formulation of policy with respect to fishing development and fisheries

resources;

• To conduct negotiations, engage in meetings, seminars or discussions with regard to fishing

or fisheries and the establishment or operations of fishing industries, whether at a national or

international level, on behalf of the Seychelles;

• To identify the human resources training requirements of Seychelles with regards to fishing

and fishing industries.


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The SFA is therefore the only national fisheries organization, with a mandate to undertake

management, planning, development, scientific and training functions, as well as to discharge the

functions of regulator, responsible for:

• Conducting surveillance in collaboration with the Coast Guard in relation to fishing

operations in the Seychelles’ EEZ.

• Monitoring the catch of all fishing vessels.

• Carrying out scientific and development research.

Another important stakeholder involved in the fisheries sector is the Indian Ocean Tuna Commission

(IOTC) which was put in force in March 1996. It is an intergovernmental organisation established

under the FAO constitution and mandated to manage tuna and tuna-like species in the Indian Ocean

and adjacent seas. The goal of the Commission is to promote cooperation among its Members so as to

ensure the conservation and optimum utilisation of stocks and encouraging sustainable development

of fisheries based on such stocks.

Yet another key partaker in the industry is a private body, the Fishing Boat Owner’s Association

(FBOA). The main function of FBOA is to create a pro-active dialogue with the government

authorities to improve transparency and alleviate many of the existing constraints between SFA and

the fishing community.

2.3 International Fisheries Relations

The Seychelles is currently receiving assistance from several sources, particularly from the European

Union and Japan.

According to the commercial fishing agreement for tuna fishing signed between the Seychelles and

the EU, a sum of €1.4 million has been allocated every year for scientific research and fisheries

development. Furthermore, funds were also disbursed by the EU in 2001 to provide assistance for the

procurement of three semi-industrial long-liners for the monofilament tuna fishery.

The European Commission, on behalf of the European Union, and the Seychelles have initialled a

new 6-year fisheries protocol to their fisheries agreement, from 18 January 2005 to 17 January 2011.

This protocol reflects the EU’s move from traditional fisheries agreements to fisheries partnership

agreements based on cooperation and dialogue to achieve sustainable fisheries in the waters of the

partner country concerned. In this context, Seychelles will reduce the fishing effort of tuna long liners

by 15 per cent by 2006. The EU financial compensation has gone up from €3.4 million to €4.1 million


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a year. Almost 40 per cent of this amount has been earmarked for promoting responsible fishing,

particularly through control, monitoring and enforcement activities.

Under the new protocol, licence fees paid by vessel owners have been increased by 50 per cent to

€15,000 for seiners, and to €2,250 and €3,000 for long liners. The number of tuna seiners remains the

same at 40 while the number of long liners will be reduced from 27 to 12, reflecting the targeted cut in

fishing effort by this category of vessels. Fishing possibilities have increased, on the average over the

last three years, from 46,000 to 55,000 tonnes. EU vessels fishing under this agreement come from

Spain, France, Portugal, Italy and the United Kingdom.

Japan has, in the past 20 years, provided six grant-aid projects with an average value of US$5.0

million. These funds have been used to build ice plants, fishing quays and fishing port infrastructure,

fund research, as well as to provide fishing vessels, fishing equipment and engines for the

development of the industry. The present ongoing project involves carrying out repairs to the fishing

port facilities damaged by the recent tsunami, and refurbishment of all ice plants built with grant aid

since 1987.

The Food and Agriculture Organisation (FAO) has also provided technical assistance to draft a

management plan for the inshore fishery and also to advise on fishery legislation. FAO has been

assisting the Government of Seychelles to update its legislation for vessels registered locally and

flying flags of convenience, and on the responsibility of the Flag State.

The major objective of all foreign aid is to assist in the development of the local fishing industry so as

to improve the volume of fish landings and the quality of the catch, and hence the income of the

sector.

3.0 FISHERIES ACTIVITIES

Fisheries activities in the Seychelles are best considered from two perspectives: fishing and fish

processing.

Under fishing activity, three main types are identified:

1. Artisanal fishing which mainly uses handlines;

2. Longline fishing which uses monofilament longline; and

3. Industrial fishing which employs purse seine nets.


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Apart from their substantive economic impact, these activities are of vital importance in the country’s

pursuit of food security, providing the bulk of the nation’s protein intake. As another important

fisheries offshoot, is the development of aquaculture, more specifically prawn farming on Coëtivy

Island.

In the fish processing industry, there are currently three plants which process and export fish caught

by the artisanal and semi-industrial fishing: Oceana Fisheries, the SMB and Sea Harvest. As for the

resources caught by the foreign vessels, some are processed by a large canning factory, namely the

Indian Ocean Tuna Ltd, while most are exported. With regards to the exportation of the main

aquaculture product, tiger prawns, this is done by the Seychelles Marketing Board (SMB).

3.1 Artisanal

The artisanal fishery is a traditional fishing activity practised solely by local fishermen, with the catch

destined principally for local consumption even though a proportion of it is exported. The fleet which

comprises of around 400 small vessels is dominated by small fibreglass boats (‛Mini-Mahe’) powered

by outboard motors (5-7 m long outboards). These have over the years represented more than half of

the vessel type used by the artisanal fleet. However, the 7-9 m “whalers” (‛Lekonomi’ and ‛Lavenir’)

which is the second most popular, contributes the most towards the total artisanal catch (56 per cent),

while the outboards stand in second place (30 per cent). The most common gear type used by this

fleet is the hook and line system.

Artisanal fishing takes place mainly within territorial waters, on the plateau areas surrounding the

granitic islands and off the banks of the continental shelf, primarily due to technological limitations of

traditional vessels. These shallow waters of the continental shelf around the main islands provide the

majority of the fish for local consumption. Though, it is characterised by a multi-species resource

base, the catch consists mostly of the ‘carangid’ family (jacks).

Besides being the major fish supplier on the local private households, the artisanal fisheries sector

provides fish and other marine resources required by the hotels and restaurants, either through

fishmongers/fish retail outlets or directly through contacts with fishermen. At the same time, this

sector satisfies the demand for local fish for approximately 1,200 crew members on around 50 foreign

fishing and cargo vessels who consume large quantities of high quality demersal fish. It is estimated

that tourists and crews on foreign vessels consume 40 per cent of the high quality demersal fish

caught by the artisanal fishery. This is beneficial to the fishermen who can get a better price for their

fish. Moreover, it offers the opportunity for ship chandlers to receive payments in foreign exchange.


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The activities of the artisanal sector may be divided in accordance to the methods used. The most

important type - in terms of fish landings - is the demersal handline fishery, which accounts for more

than 50 per cent of total fish landings by the artisanal fisheries. The catch of such activity consists

mainly of the high value demersal species such as snappers (‘bourzwa’) and groupers on the Mahe

and Amirantes Plateaux as well as the semi-pelagic species like ‘carangue’ and ‘becune’ which are

mostly caught inshore2 within a radius of 15 miles from the main granitic islands3. This type of

fishery involves full time commercial, part-time as well as recreational fishermen.

The second most important method is the trap fishery. This is mostly used to exploit the reef

resources such as the rabbit fish (‘kordonnyen’) and the parrot fish (‘kakatwa’). It is used by most

fishermen in conjunction with other fishing activities especially during the South East Trade Winds

when sea conditions are relatively rough.

The other types of fishing methods which are of lesser importance include:

- Net fishery which uses either beach seine or gill nets designed to fish mackerel (‘makro’) and

other small pelagic resources;

- Live Fish Fishery which targets some high valued species such as snappers and groupers to

be exported to the Far East (mainly Hong Kong);

- Sea Cucumber Fishery which is carried out mainly to be exported to the Far East markets;

- Shark Fishery which is mostly done using long-lines especially following the ban on using

gillnets in 1998.

- Octopus Fishery which can be regarded as a part-time subsistence fishery is undertaken by

skin divers and foot fishermen, and the output is primarily to be sold to hotels and restaurants

as well as take-away businesses;

- Lobster fishery which is mainly to cater for the tourism market, is a seasonal fishery with an

open season from the beginning of November to the end of January; this is a strictly

controlled activity and practitioners require a licence;

- Mother-ship dory operations which consist of a large mother-ship vessel (usually a

refrigerated cargo/reefer vessel) equipped with at least a dozen small boats that fish within the

vicinity of the anchored mother-ship;

- Spanner Crab (‘Crab Giraffe’) Fishery which is carried out mostly on the Mahe Plateau by a

maximum of three vessels using loop tangle nets;

- Sports Fishery which is an important activity for charter boat owners catering for tourists;

2 It is believed that the inshore resources are being heavily exploited as compared to those around the edge of the Mahe plateau. 3 Report on Existing and Potential Employment Opportunities in the Fisheries Sector In Seychelles by Joel Nageon de Lestang, May 2005, page 23


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3.2 Semi Industrial

The semi-industrial longline fishery is a monofilament longline fishery targeting pelagic fish found

outside the Mahe plateau but mostly within the Seychelles EEZ. This mainly include swordfish with

by-catch comprises of yellowfin and bigeye. The fleet consists of a few local vessels (around 8)

equipped with modern electronic equipments and monofilament longline spools. The catch which has

an annual average weight of around 275 metric tonnes (MT) is mainly sold to the two export

companies, Oceana Fisheries and Sea Harvest, exporting primarily to the EU (UK, France and Italy).

In contrast to the artisanal fisheries, the majority of semi industrial catches are exported, although a

small amount of swordfish is marketed locally.

This type of fishery which was introduced in the mid-1990s had its first fishing trials carried out by

the research vessel ‘Etelis’, by Mr. William Travis, a fisheries consultant recruited by SFA. The trips

were financed by ‘Association Thonier’ (AT) funded by the EEC which also provided technical

assistance. Following these trials, whereby interesting results were obtained, local entrepreneurs were

encouraged to invest in this fishery with the first commercial trip taking place in October 1995. This

involved 8 trips which were conducted by 1 longliner. By the end of 1995, it had landed 26 tonnes.

In the following year, a total of 87 trips were conducted by 4 local longliners belonging to 2 private

companies. Hence, these marked the debut of this fishing activity.

There is however one major problem associated with this type of fishery. Apparently, the loss of

catch from using this method of fishing is relatively high. This is due to predation presumed to be by

the false killer whales and also partly by sharks. On top of that and several other constraints faced by

the semi-industrial fishery, the activity was further affected in 2003 by the export restriction on

swordfish to the European market towards the middle of the year, on account of an unacceptable level

of cadmium found in this species of fish. This led the concerned fishermen to concentrate their

fishing effort towards other species mainly sharks. On average, in that year out of 7 vessels only 4

were targeting swordfish and tunas.

On a welcome note, the ban on the export of swordfish to the EU was lifted in January 2005 following

a revision in the EU food standards for the heavy metal. This gave a breath of life to the semi-

industrial fishery targeting swordfish, as vessels resumed their effort to target swordfish and tuna

which had almost come to a standstill in the previous two years.

3.3 Aquaculture

In spite of the fact that several aquaculture projects have been discussed in Seychelles, only three have

so far been implemented. These three ongoing projects - Coëtivy Prawn farm, the Pearl Oyster farm

and Giant Clam farm - are all being located outside Mahe. One limiting factor for the development of


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aquaculture in the country is the availability of sites, both on land and fresh water resources such that

any aquaculture project would have to be marine-based aquaculture or more precisely mariculture.

3.3.1 The Prawn Farm

The Coëtivy prawn farming started in 1988 with the first harvest taking place in 1989. The farm

which is under the management of the SMB is located 300 kilometres from Mahe. Over the years, it

has experienced several developments, especially in terms of expansion in productive capacity.

Compared to its initial scale, he farm has doubled in size. Despite being operational much earlier, the

farm was formally inaugurated in early 1994 along with the commissioning of a hatchery.

The main species reared at the farm is the giant black tiger prawns (Peneus monodon), cultivated in

sea water ponds. The black tiger prawn broodstocks are imported from Madagascar and

Mozambique, and the local farm uses its hatcheries to produce its own Post Larvae (PL). Evidence

has shown that the domestically produce PL are of superior quality compared to those, that were being

imported from the Far East in the earlier years.

In terms of the shrimp feed, this was mostly being imported from the Far Eas prior to 1995. However,

following a disruption in supply, the SMB started to produce shrimp feed to meet the requirements of

the farm. This gave a boost to production, given that the local feed is better suited to the high salinity

culture system used at Coëtivy. Moreover, in view of the fact that the feed is fresher than the

imported ones, this has also helped to lower the feed conversion ratio (FCR), i.e. the cost of producing

the same amount of shrimp was reduced.

3.3.2 Giant Clam Farm

The giant clam farm as well as the oyster farm is operated by the Praslin Ocean Farm. The former

was established in 1995 and is located in the National Park between Praslin and Curieuse, covering a

total area of around 19 hectares.

The Giant Clam farm was started in 1993 and the clams are reared in eight raceways located on land

at L’Amitié, next to the Praslin airport. Clams are mainly exported for the aquarium trade in Europe

and the US, but demand has slowed down considerably over the years. This is because market

demand in the worldwide aquarium trade is for clams with vivid colours, while the clams produced in

Seychelles are mostly brown in colour.

Thus, such farming did not develop as was expected due to this difficulty of exporting the live

product. One other issue was that in the late nineties these creatures were put on the list of

endangered species of the Convention on International Trade and Endangered Species (CITES).


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Consequently, export became more difficult as it was required that the giant clams are bred in

captivity for the second generation.

3.3.3 Pearl Oyster Farm

Pearl oyster farming was established in 1995 with the first harvest of round pearls taking place in

early 1997. While some of the pearls are mounted as jewellery and put on sale at the farm’s shop

others are exported to Japan and Australia. The quality of the pearls harvested has improved

significantly over the years.

3.4 Industrial Tuna Fishing

Tuna, a migratory pelagic fish, is currently by far the most important marine resource. By a fortunate

quirk of nature, the Seychelles which consists of a widely scattered group of islands in the vast

Western Indian Ocean lies astride an important tuna migration route. Thus, it is strategically placed to

exploit these species principally yellow fin and skipjack tuna, which are found beyond the continental

shelf.

The industrial tuna fishing activity emerged in the mid 1970s in the Seychelles. At that time, the most

rapid and effective way to develop this sector was to enter into joint ventures with foreign partners. In

1977, there was a major turning point in the development of the sector, whereby the Maritime Zones

Act No. 15 which was enacted under UN auspices in May of that year, declared for Seychelles a 200-

mile Exclusive Economic Zone (EEZ) along with other important legal matters. The aim of this was

to protect its highly rich tuna grounds from far-ranging deep-sea fishing fleets from Japan, Taiwan,

Korea, and Russia. Prior to this, the country could only exercise fisheries jurisdiction over coastal

waters up to a distance of only 12 miles. As a result, the development of the sector gathered

momentum to its present point of national importance. Throughout these years, major agreements

were signed with France, Germany, UK and Spain, with many related to fishery research.

This type of fishing activity is undertaken beyond 100 kilometres from the Seychelles coasts. It is

operated by large foreign-owned licensed vessels, including around 40 Seychelles-registered vessels

that fall into two main categories:

• the tuna purse seine fishery, which is composed of EU vessels, namely from France

and Spain and targets mostly surface-swimming tuna (skipjack and yellowfin); and

• the longline fishery which is made up mostly of Taiwanese, Japanese and South

Korean vessels and targets yellowfin and deep-swimming big-eye tunas.

The majority of the tuna vessels are foreign-flagged and owned; with a few Seychellois sailors

employed on them. On average, there are around 50 active purse seiners fishing in Seychelles waters.


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The main constraint facing the development of the industrial tuna fishery in the country is the lack of

adequate port infrastructure, such as berthing space and cold storage facilities. Purse seiners tranship

most of their catch to reefer vessels, to be transported to Europe and other regional canneries

(Mauritius and Madagascar) and such transhipment operations can be carried out at anchorage.

Longliners however, require more berthing space and preferably cold storage facilities (at -60º C) to

store their catch for onward transportation to Japan. Because of lack of berthing space and cold

storage facilities (at -60º C) and allegedly high fuel and shipchandling costs, longliners prefer to

tranship directly at sea or land their catch at other regional ports such as Port Louis, Durban,

Singapore and Phuket.4

3.4.1 The Industrial Purse Seine Fishery

Purse seine fishery uses seine nets to catch the pelagic fish which form schools such as tuna. The first

trials of industrial scale purse-seiner fishing boats in Seychelles were conducted in the early 1980s

whereby the French tuna industry sent a purse-seiner, the ‘Ile de sein’, on a 3-month survey.

Following the encouraging results, a 7-month French expedition was undertaken and likewise this had

positive findings. At the end of 1982, four vessels previously based at Abidjan, Ivory Coast, started

commercial fishing on a trial basis. Two years later, around 45 European purse seiners from West

Africa (mainly French and Spanish) moved to the Western Indian Ocean using Port Victoria as their

central operating base.

3.4.2 The Industrial Longline Fishery

This fishery dates back to the early 1950s when Japanese longliners were fishing in the Western

Indian Ocean. In 1979, after the official proclamation of the Seychelles Exclusive Economic Zone

(EEZ), longliners from the Far East (mostly Japan and South Korea) were licensed to fish in

Seychelles waters. However, serious commercial fishing actually started in 1983. Unlike the purse

seiners, longliners target large deep-swimming tuna, in particular bigeye, which fetches a higher price

on the Japanese sashimi market.

In terms of the number of licences which are issued on a monthly basis, this has increased over the

years. The annual number of licences issued to longline vessels averaged around 255 in the years

1987 to 2005, with a peak posted in 2003 at 415 (282 Taiwanese, 43 Koreans and 90 Japanese). The

longline catch which averaged 2,836 metric tonnes (MT) in the 1990s was more than doubled in the

early 2000s with a mean of 5,637 MT. Nonetheless, the average catch per unit effort (CPUE)

remained relatively constant at 0.43 MT/100 hooks, over the years.

4 Joel Nageon de Lestang, May 2005, page 41


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3.5 Processing and Exporting Plants

At present, there are only four firms engaged in the processing and/or exportation of fish and fish

products. These are the Indian Ocean Tuna Ltd., Sea Harvest (Pty) Ltd Seychelles, Oceana Fisheries

Company Ltd and Seychelles Marketing Board (SMB).

3.5.1 Indian Ocean Tuna Limited

The tuna cannery was established in 1987 by the government of Seychelles and acquired the name

‘Conserverie de L’Océan Indien’. At that time 70 per cent of its capital was of Seychelles origin and

the remaining 30 per cent was invested by two French companies namely ‘Pécheurs de France’ and

‘Armement Coopératif Finistérien’. However, the business was unprofitable due to several factors,

not least high production costs, unreliable tuna supplies, low technical conversion ratio and lack of

working capital.

Thus, in 1995, Seychelles witnessed the privatisation of the ‘Conserverie de L’Océan Indien’,

whereby the American food giant H. J. Heinz acquired 60 per cent of the shares in the company and

changed the name to Indian Ocean Tuna Ltd. Upon its acquisition by Heinz, the production capacity

of the plant expanded constantly. The cannery which is one of the largest tuna canning factories in

the world processes about 90 thousand tonnes of tuna per year. The annual average production of

canned tuna for the years 2001 – 2005 stood at around 35,089 MT as compared to 21,759 MT in the

years 1996 – 2000. It employs a little over 2,500 workers, representing about 6.0 per cent of total

employment or approximately 50 per cent of the total number of employees in the fisheries sector.

3.5.2 Sea Harvest (Pty) Ltd Seychelles

Sea Harvest (Pty) Ltd Seychelles was formed in 1995 upon the development of the semi-industrial

tuna fishery. Yet, it does not only process pelagic resources but also demersal species bought from

the local artisanal and semi-industrial fishery. The plant exports fresh fish, frozen fish, whole fish as

well as loins mainly to Germany, UK, and France. Another activity of the company is the importation

of fishing material and other inputs for the fishing industry.

3.5.3 Oceana Fisheries Company Ltd.

Oceana Fisheries Company Ltd was formed following the privatisation of the Seychelles Marketing

Board, Fish Division in 1995. Like Sea Harvest, the company is involved in the business of supplying

fish to the local market and exporting fish overseas. Its main activities are to purchase fish from the

artisanal and semi-industrial fleet and process them before selling. Its main market is Mauritius

mostly for frozen fish, followed by Reunion, UK and France. Oceana also owns a longliner – Pisces -

and has contracts to purchase fish from some local vessels. The company also imports seafood

products such as crabsticks.


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3.5.4 Seychelles Marketing Board.

The Seychelles Marketing Board (SMB) which was formed in 1985 is engaged in the production and

export of black tiger prawns. For a period of around 10 years, the Fish Marketing Division of the

SMB was actively engaged in the operations of the fishing sector, a responsibility previously vested in

the Seychelles National Commodity Company (SEYCOM), which became defunct. The SMB was

responsible for purchasing all domestic fish catch and distributing the same, thereby providing fish

both for domestic consumption and for export.

4.0 ECONOMIC CONTRIBUTION OF THE FISHERIES SECTOR

The fisheries sector has and continues to play an important part in the socio-economic development of

the country mainly through

1. Employment creation;

2. Foreign exchange earnings;

3. Foreign Direct Investment;

4. Technology transfer; and

5. Contribution to local nutrition.

Notwithstanding the above, data from the National Accounts (NA) surprisingly reveal a relatively low

impact of the fisheries sector on overall economic output. According to the statistics, the underlying

sector grew at a comparatively slow pace over the years. This is however more a matter of accounting

convention as ‘fishing’ in the Gross Domestic Product (GDP) does not capture contributions from the

whole industry, but only those of the direct local fishing activities. Therefore, the data exclude other

fisheries activities, such as processing and associated services relatting to the fisheries sector. These

are rightly recorded under manufacturing or other appropriate economic heads. Thus, when assessing

the overall value added of the fisheries sector, one must extend the scope of the analysis to take this

matter into account.

Over the years, the growth of the fisheries sector has acted as a strong catalyst for the development of

various peripheral and supporting activities, such as ship-chandling and stevedoring services. Most

importantly, it today lies at the centre of a large tuna canning industry; at the artisanal and semi-

industrial level, it supports a number of growing businesses, including the building of small fishing

vessels (up to 12 meters), the manufacture of Fish Aggregating Devices (FADs), fishing nets and

traps.


- 13 -

Chart 4.1: Value Added Contribution of the Fishing Sector; 1984 - 2004

0

10

20

30

40

50

60

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

Years

R m

illio

n

0.0

0.5

1.0

1.5

2.0

2.5

% s

hare

Value Added % Share


4.1 Employment

Official figures from the Seychelles Fishing Authority estimate the number of fishermen actively

involved in commercial fishing at between 1,700 to 1,800 persons (85 per cent of them full-time)

representing around 4.0 per cent of formal employment. If people employed in other fishery related

jobs such as tuna canning, stevedoring and so on, are taken into account, the number of people

employed through this sector stands at 6,000 (2005 figure) occupying 15 to 16 per cent of formal

employment. A number of other jobs which cannot be easily quantified are also indirectly created,

through the multiplier effect in downstream sectors such as boat building, mechanical repairs, fishing

supplies, transport activities, distribution and export logistics.

One important development in employment in this sector occurred in the early eighties. With the

arrival of tuna purse seiners in 1983 and early 1984, there was a dramatic rise in demand for

stevedoring. As a result, the number of stevedores which averaged 130 in 1983 rose to 550 in 1985

and reached 750 in 2004.

4.2 Fish Consumption and Fish prices

Fish consumption in Seychelles is widely believed to be one of the highest per capita in the world.

Most of the fish consumed locally are landed by the artisanal fleet with a few by the semi-industrial

fleet. Further, and as mentioned before, the local sub-sector also provides high quality fish for the

tourism industry. It is further claimed that tourists and crews on foreign vessels consume 40 per cent

of the high quality demersal fish caught by the artisanal fishery.


- 14 -

As for the prices of fish5, the trend has been a rapidly increasing one since 1980. The annual average

consumer price index (CPI) for fish increased substantially from 100 in 1980 to 154 in 2005 – a

yearly average rise of 2.2 index points. One interesting feature about the price of fish is that in any

one year, it displays large fluctuations which are influenced by the seasonal pattern in fish catch. The

price of fish is strongly correlated (negatively) to its supply.

Chart 4.2: Fish Prices; 1980 - 2005

020406080

100120140160180

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Years

Inde

x P

oint

s

-40-30-20-1001020304050

Per

cent

age

Fish CPI Fish Inflation


4.3 Production of the Fisheries Sector

The aggregate output of the fisheries sector has increased extensively since 1980, especially following

the emergence of the industrial tuna activity in mid eighties. (See graph below). Output which stood

at 4,043 MT in 1983 rose by 98,755 MT in the following year. The factor behind this rapid growth in

the overall production was the catch of the industrial sector which operates on a much larger scale as

compared to the other activities. Most of the production in the sector, reflect output from the

industrial fishery.

5 The average annual Consumer Price Index (CPI) for locally caught and marketed fish (mostly artisanal fisheries products).


- 15 -

Chart 4.3: Production of the Fisheries Sector; 1980 – 2005

-50,000

100,000150,000200,000250,000300,000350,000400,000450,000500,000

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Years

Met

ric

Tonn

es

fish & fish-related products industrial tuna catch

Sources: National Statistics Bureau & Seychelles Fishing Authority

4.3.1 Local Production

As may be seen from the graph above, the local production of fish and fish-related products6 in

tonnage terms is very small as compared to that of the industrial tuna sector. A closer analysis reveals

a progressive improvement in the local fisheries production. At the aggregate level, the most

significant increase in overall fisheries production was posted in 1999, driven by the output of the

tuna canning factory. A peak of around 46,450 MT was recorded in 2005, of which canned tuna

represented almost 90 per cent of that total. Prior to the privatisation of the I.O.T. in 1995, the

artisanal catch constituted the largest share at an average of 64 per cent.

4.3.1.1 Primary Production

The primary production of the fishing sector – being the catch of the local fishing sub-sector (the

semi-industrial and artisanal fisheries) and the harvesting of prawns - has not shown any major

underlying change in the years 1980 to 2005. Nevertheless, along trend, slight fluctuations have

occurred in these years. An output drop occurred in 1998 as a result of a rise in sea surface

temperature caused mass coral-bleaching in the Indian Ocean, during that year. Scientists have

argued that this development may have caused some disruptions to fish feeding behaviour forcing the

fish biomass to move to deeper and cooler waters, hence making them less accessible to harvesting by

fishermen.

6 Artisanal and semi-industrial catch, production of canned tuna, other processed tuna, production of prawns and smoked fish, spiny lobster catch and others.


- 16 -

Chart 4.4: Primary Local Production of the Fisheries Sector; 1980 - 2005

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Years

Met

ric T

onne

s

artisanal catch semi-industrial catch prawns

Source: Seychelles Fishing Authority

Catch of the artisanal fishing represents around 90 per cent of the total local fish production. Yet,

although such activity has great potential, its catch has remained fairly stable over the years,

averaging 4,600 MT. It is today unclear whether this output can be increased without adversely

affecting the sustainability of the demersal fish biomass. However even if such a risk did not exist,

the sector faces other impediments to further growth, the most important of which being the small

fishing capacity of the artisanal fleet and the shortage of Seychellois fishermen. In spite of the fact

that the earnings of artisanal fishermen are relatively high, young people tend to avoid it and one

reason is of the hard life and commitment the profession requires. Since 1985 if not none, only a few,

of the polytechnic graduates of the artisanal fishing course has been attracted to work in the sector.

Over the years, the general pattern of catch composition for the artisanal fisheries, adjusting for

seasonal influences, has not changed much since 1980. The pelagic carangids (‘karang’) continue to

dominate landings, followed by common demersal species and species-groups, such as red snappers

(‘bourzwa’) and groupers. Catches tend to be highest in the monsoon periods - March-May &

October-November - when sea conditions are most conducive to fishing and lowest during the months

of the South East Trades - May-September - particularly in August, when sea conditions are moderate

to rough.

By comparison, the semi-industrial fishery which began in mid 1990s, has demonstrated high

fluctuations over the years. Annual landings of swordfish and by-catch species have ranged from 111


- 17 -

to 457 MT. The most noteworthy change, a downward slide, was recorded in 2003, following a drop

in fishing effort. This was caused by the ban on the export of sword fish to the EU market, forcing

fishermen to target sharks and sea cucumbers. As mentioned earlier, this veto was imposed in view of

the level of cadmium in swordfish being higher than the minimum acceptable standard set by the EU.

As for prawns, the level of production has depended largely on the output of post-larvae at the

hatcheries, which is further linked to the quality and quantity of broodstock that can be obtained from

the supplying countries. Over the years 1992 – 2005, the yield of the black tiger prawns has increased

rapidly, from a low of 55 MT in 1992 to a high of 1,175 MT in 2004. To some great extent, this

reflects the investment made at the farm which improved its productive efficiency considerably.

4.3.1.2 Secondary Production

The secondary production of the fishing sector which involves fish processing for the export market is

dominated by tuna canning. On average, output of canned tuna represents 97 per cent of the total.

Thus in line with the rise in the output of canned tuna, the total production for the secondary fishing

activities moved rapidly on an upward trend with the most significant increase posted in 1999. As to

be expected, this was spurred by the growth of 75 per cent in the production of canned tuna, following

the completion of ‘Project Diamond’ which significantly expanded both the capacity of the plant and

supporting infrastructure.

Chart 4.5: Secondary Production of the Fisheries Sector7; 1980 - 2005

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Years

Tonn

es

overall secondary production canned tuna

Sources: National Statistics Bureau & Seychelles Fishing Authority 7 Secondary Production …..


- 18 -

4.3.2 Industrial Tuna Production

The catch of the industrial tuna vessels are mostly sold on the external market, either for consumption

or for processing. On average, throughout the years 1984 – 2005, 80 per cent of the total amount of

tuna caught in the Seychelles waters was transhipped. Thus, there is no real and significant direct

contribution from the industrial tuna activity to the domestic economy, but the country benefits in

terms of foreign exchange earned from bunkering, ship chandling and other services as well as in

additional employment created.

Landing of tuna by the industrial purse seine fleets have grown substantially over the 22 years ending

2005, albeit with a high degree of variability between years within certain periods. These vessels

which are licensed to fish in the Seychelles EEZ posted an almost four-fold increase in their overall

catch in 2005 as compared to 1985, reaching a zenith of 408,366 MT in 2003. This reflects the

increase in efficiency of such activity, especially given that the fishing effort and the number of active

vessels have remained somewhat constant.

Chart 4.6: Industrial Tuna Catch; 1980 - 2005

-50,000

100,000150,000200,000250,000300,000350,000400,000450,000

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Years

Met

ric to

nnes

-20

-10

0

10

20

30

40

catch transhipment % change in catch


4.4 Foreign Exchange Earnings

In light of the continuous development in the fisheries sector, the amount of foreign exchange it

generated has increased rather rapidly since the early nineties. Throughout this period, most of the

foreign exchange revenues were collected from the industrial tuna fishing vessels (69 per cent) but

this changed in the late nineties and the beginning of the new millennium.


- 19 -

Chart 4.7: Gross Foreign Exchange Earnings from Fisheries; 1991 – 2005

0.0

200.0

400.0

600.0

800.0

1000.0

1200.0

1400.0

1600.0

1800.0

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

years

R m

illio

n

Visible Exports Industrial Tuna Fishing


From 1996 onwards, visible exports of fish and fish related products accounted for about 70 per cent

of the total foreign exchange generated by the fishery sector. This was mostly due to the increasing

amount of revenue collected from the export of canned tuna, especially after the privatisation of the

factory in the mid-nineties.

The above said, it is an obvious fact that a major part of the gross fisheries foreign exchange inflows

leak out as imported inputs of production, notably for the payment of the tuna, spares, packing &

canning materials and expatriate labour. Still, this sector remains vital for the country in terms of the

balance of foreign exchange earnings retained.

On a gross basis, the foreign exchange generated by the fisheries sector has now probably exceeded

that of tourism.8 On average, fisheries represented about 47 per cent of the total foreign exchange

earnings, in 2000 – 2005, demonstrating an upward trend from 42 per cent in 2000 to 50 per cent in

2005.

8 This assertion is clearly the case if the comparison is done on the basis of collections channelled through the domestic financial system but probably not quite the case if tourism inflows are adjusted upwards to reflect leakages to the parallel market.


- 20 -

Chart 4.8: Share of Fisheries towards Foreign Exchange Export Earnings in the Goods and

Services Account; 2000 – 2005

50%

48%50%

42%46% 46%

58% 54% 54% 50% 52%50%

0.0

200.0

400.0

600.0

800.0

1000.0

1200.0

1400.0

1600.0

1800.0

2000 2001 2002 2003 2004 2005

Years

R m

illio

n

Fisheries Tourism

Sources: Seychelles Fishing Authority & Central Bank of Seychelles

4.4.1 Visible Export Earnings

The fisheries products remain the most important visible exports in the goods account, in terms of

foreign exchange earnings. Especially following the commencement of canned tuna export in 1987,

the share of fish and fish products in domestic export overwhelmingly dominated domestic goods

exports. For the years 1991 – 2005 it averaged 85 per cent, with the highest earnings collected in

2003 at R1.1 billion.

The driving factor for the fast growth in the amount of foreign exchange generated by the export of

fishery products has been, as earlier mentioned, the activity at the I.O.T factory. Volume of canned

tuna exported increased considerably over the years, from 6,172 MT in 1991 to 39,143 MT in 2005.

For the years 2001 - 2005, earnings generated from the export of canned tuna have accounted for 92

per cent of the total foreign exchange earnings of fish and fish products.


- 21 -

Chart 4.9: Average Composition of Visible Export Earnings of Fish and Fishery Products; 2001

- 2005

Other f ish products0.0% other processed f ish

2.9 %

dried shark f ins0.05 %

Sea cucumbers 0.1% frozen praw ns

2.8%

fresh and frozen f ish 1.9 %

canned tuna92.2 %


Prior to the opening of the tuna canning factory, exports earnings were mainly collected from the

overseas sale of fresh and frozen fish, which accounted for more than 90 per cent of total earnings.

During these years, less than R10 million was earned from the whole sector but in 1987 with the

commencement of canned tuna exports, earnings increased to R37 million. Thereafter, earnings from

fish and fish products had exhibited a steady growth until 1996 when the pace picked up significantly

(at 80 per cent). This again, coincided with the acquisition of the tuna canning factory, by Heinz, as

well as the increase in the amount of foreign exchange generated by ‘prawns’, though by a smaller

extent. In the years preceding the privatisation of the tuna canning factory, the factory was achieving

an average share of 75 per cent in total earnings whilst after privatisation, its share rose to an average

of 90 per cent.


- 22 -

Chart 4.10: Visible Export Earnings; 1991 - 2005

0

200

400

600

800

1,000

1,200

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Years

R m

illio

n

Total Canned Tuna

Sources: Seychelles Fishing Authority and Central Bank of Seychelles

In spite of the positive development in the share of export earnings of fish and fish product in total

domestic exports, that from the demersal sector declined continuously, from a high of 18 per cent in

1991 to a low of 1.4 per cent in 2005. On average, for the past 10 years, export from the artisanal

sector, namely fresh and frozen fish, account for only 2.0 per cent of the total volume of export of fish

and fish products and around 3.2 per cent of foreign exchange earnings generated by the fisheries

sector. Foreign exchange revenue collected from this local fishing sector stood at around R20 million

per year in the past 15 years, with a maximum of R30 million in 2003. The most significant increase

was in 1994 (at 118 per cent), following the liberalisation of the fish export business in 1993.

As for the contribution of the prawns industry to total exports, in volume terms, this demonstrated a

general upward trend in the years 1991 - 2005. The amount of prawns exported in the 1990s averaged

176 MT (average share of 1.1 per cent) as compared to 597 MT in 2000 - 2005 (average share of 1.5

per cent). However, on the earnings side, growth was at a lower pace from an average of R10 million

in the 1990s to R26 million since the beginning of the new millennium.

4.4.2 Trade Balance

Trade balance in the fisheries sector remained positive from 1991 to 2005, having increased

substantially during these years. On average, 40 per cent of the total foreign exchange earned on the

visible fishery exports was used to cover the costs of importing fish and fish products. Factor in an

allowance for other imported inputs including expatriate compensation, the net foreign exchange

retention level of the industry must be in excess of 30 percent.


- 23 -

Chart 4.11: Trade Balance in the Fisheries Sector; 1991 - 2005

0.0

100.0

200.0

300.0

400.0

500.0

600.0

700.0

800.0

900.0

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

years

R m

illio

n


4.4.3 Revenue from the Industrial Tuna Fishing Activity

Seychelles, which does not have its own commercial fishing fleet, does not draw earnings directly

from its valuable tuna resources. Yet, it enjoys a generous amount of revenue from this sector which

consists mainly of expenditure by foreign fishing vessels on goods and services in port (mostly

bunkering, ship supplies and repairs to nets, equipment, etc..), spending on goods and services by

locally based foreign fishing companies and payment of fees for access to the EEZ.

Since 1991, gross revenue from the industrial fishing activity has been on an upward trend, with a

mean annual growth rate of 6.6 per cent. Vessels’ expenditure remained by far the most important

source of revenue from industrial activity, accounting for 83 per cent of the total revenues collected

from this activity. The considerable increases in such expenditure in the more recent years reflected

to some large extent the surge in the world price of oil.


- 24 -

Chart 4.12: Gross Revenue from Industrial Tuna Fishing Activity

0.0

100.0

200.0

300.0

400.0

500.0

600.0

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005years

R m

illio

n

Vessels' Spending Companies' Expenditure License Fees


The second most important component of the gross revenue from industrial tuna fishing activity is

payment of licence fees. Licence payments comprise of the financial compensation by the EU, access

payment by ship owners, and payment for excess catch inside the EEZ which is currently set at above

the 46,000 MT thresholds.

It is interesting to note that although the total number of EU vessels allowed to fish in Seychelles

waters has been reduced from 67 to 52 (40 tuna purse seiners and 12 longliners), the EU financial

contribution has been increasing. This may be explained by the rise in the licence fees for the purse

seiners and longliners.

5.0 CONCLUSION

The rapid expansion of the fisheries industry, especially in the areas of industrial processing, has been

a phenomenal economic achievement. Yet for various structural and technical reasons, Seychelles has

not been able to optimally exploit benefits from the sector to the extent it would have liked. Although

some 400,000 metric tones of tuna are transhipped through Port Victoria and some 40,000 metric

tones of canned tuna are processed and exported, the value added to the country are mostly derived

from royalties (mostly fishing licence fees and canned tuna exports) and peripheral service activities

(bunkering, ship chandling, stevedoring, minor repairs, etc..). To-date, despite various determined

attempts, the country has failed to develop any significant – and viable - pelagic fishing capability and

in light of the prevailing financial and technological barriers, is unlikely to do so in the near term.


- 25 -

With growing scientific evidence that tuna exploitation in the South-West Indian Ocean nears

saturation point, the scope of further income growth through the sale of supporting services is fast

narrowing, thus dampening the country’s future growth prospects. In addition, the seriousness of the

competitive threat posed by other regional ports for tuna transhipment and seafood processing cannot

be lightly dismissed.

Against this challenging backdrop, the country is now obliged to explore avenues to maximize the

domestic value added of the fisheries sector by somehow increasing the domestic content of each

dollar earned from the tuna business. This is no easy task as at this very juncture, the EU tuna fishing

operators have filed complaints about inadequate and sub-standard infrastructure and high operating

service costs in Port Victoria. Addressing these concerns in a cost-effective manner is critical to the

future of the industry and the government and all stakeholders are actively working on possible

solutions.

A review of these solutions, as well as an in-depth assessment of the industry’s constraints, threats

and opportunities, will be the theme of a second and final paper of this study.


- 26 -

REFERENCES

- SFA Annual Report (1988 – 2004)

- Economic Papers

• Industrial Fishing In Seychelles by Bertrand Rassool and Jean Weeling

• The Fisheries of Seychelles, Marine Resources Review, Spring 1990

http://www.highbeam.com/library/docfree.asp?DOCID=1G1:10826711&ctrlInfo=Round

19%3AMode19a%3ADocG%3AResult&ao=

• Report on Existing and Potential Employment Opportunities in the Fisheries Sector In

Seychelles by Joel Nageon de Lestang, May 2005

• Inshore Fisheries Management Strategy (FAO: TCP/SEY/6713(A)), May 1998, Part C,

ANNEXES, pages 117 - 127

• SMDJ Seychelles Medical and Dental Journal, Special Issue, Vol 7, No 1, November

2004: Seychelles in perspective - placing child development in context: The fishing sector

in Seychelles: an overview, with an emphasis on artisanal fisheries. Page 52 - 56

Jan Robinson, MSc; Seychelles Fishing Authority, Republic of Seychelles;

Jude Shroff, BSc; Seychelles Bureau of Standards, Republic of Seychelles.

- www.fao.org

S T A T I S T I C A L A P P E N D I X

Table 1


Assets and Liabilities

1 - A S S E T S

R million - end of Period

E x t e r n a l A s s e t s Gold Claims on Gov't Advances Balances I. M .F. and Advan- Other to Other Total and Reserve SDRs Silver ces Banks

Securities Tranche Coins

1981 81.1 3.1 1.3 2.8 15.9 2.7 10.5 4.9 122.31982 80.6 3.2 1.2 2.8 23.6 9.7 13.8 8.9 143.81983 68.3 - 0.4 2.8 55.4 2.6 13.7 21.4 164.61984 59.5 - 0.2 2.8 66.5 3.2 9.6 27.7 169.51985 57.0 - 0.1 2.8 61.8 44.5 6.5 24.1 196.81986 46.5 - 0.1 2.8 80.2 21.3 20.7 23.5 195.11987 69.7 - . . 2.8 - 139.3 13.7 25.6 251.11988 46.1 - 0.1 - 144.1 21.6 21.4 25.9 259.21989 65.2 - . . - 25.5 77.8 30.7 25.0 224.21990 84.0 - . . - 63.5 42.0 18.5 29.9 237.91991 137.7 - 0.3 - 18.0 92.9 13.0 23.0 284.91992 151.7 5.8 0.1 - 60.9 180.5 4.0 24.3 427.31993 174.6 5.8 0.1 - 116.1 185.9 21.5 24.0 528.01994 136.8 5.8 0.1 - 248.6 280.6 7.0 23.4 702.31995 120.8 5.8 0.1 - 452.4 210.9 1.8 26.2 818.11996 93.3 5.8 0.2 - 503.6 286.9 0.0 25.3 915.01997 121.4 5.6 0.2 - 923.2 3.6 0.0 22.5 1076.41998 115.0 0.0 0.2 - 469.0 106.0 10.0 23.7 723.91999 160.0 0.0 0.2 - 623.9 16.2 0.0 23.2 823.52000 271.0 0.0 0.1 - 395.9 303.0 22.0 25.1 1017.02001 210.5 0.0 0.1 - 472.4 301.7 0.0 53.7 1038.32002 352.2 0.0 0.1 - 1092.0 201.2 0.0 24.3 1669.82003 369.1 0.0 0.0 - 811.0 200.7 19.0 30.5 1430.3

2004Jan. 360.9 0.0 0.0 - 823.2 200.2 0.0 96.2 1480.5Feb. 365.3 0.0 0.0 - 823.2 200.1 0.0 29.5 1418.2Mar. 165.9 0.0 0.0 - 861.6 200.0 0.0 49.1 1276.6

Apr. 139.6 0.0 0.0 - 1390.5 200.0 0.5 49.2 1779.9May. 139.0 0.0 0.0 - 1264.1 100.0 245.0 55.6 1803.8Jun. 179.6 0.0 0.0 - 1181.6 179.5 131.0 59.9 1731.7

July 163.1 0.0 0.0 - 1510.1 84.0 10.0 61.8 1829.1Aug. 161.0 0.0 0.0 - 1402.2 84.0 12.0 58.7 1718.0Sept. 158.3 0.0 0.0 - 1558.3 84.0 0.0 70.8 1871.4

Oct. 160.5 0.0 0.0 - 1517.7 84.0 0.0 83.4 1845.7Nov. 171.0 0.0 0.0 - 1490.2 84.0 16.0 99.3 1860.5Dec. 187.8 0.0 0.0 - 1316.6 84.0 120.0 27.9 1736.3

2005Jan. 192.9 0.0 0.1 - 1396.1 84.0 0.0 104.2 1777.2Feb. 200.9 0.0 0.0 - 1398.8 84.0 0.0 109.0 1792.8Mar. 229.4 0.0 0.0 - 129.1 1459.0 10.0 41.8 1869.4

Apr. 224.9 0.0 0.0 - 117.2 1353.4 0.0 61.7 1757.2May. 224.8 0.0 0.0 - 101.1 1353.4 0.0 53.4 1732.8Jun. 242.2 0.0 0.0 - 0.0 1353.4 0.0 64.2 1659.9

July 238.0 0.0 0.0 - 0.0 1353.4 31.0 61.7 1684.2Aug. 253.5 0.0 0.0 - 1.2 1353.4 0.0 66.5 1674.7Sept. 277.5 0.0 0.0 - 0.0 1353.4 0.0 70.8 1701.8

Oct. 279.5 0.0 0.0 - 0.0 1353.4 0.0 78.8 1711.7Nov. 276.7 0.0 0.0 - 0.0 1340.8 0.0 70.6 1688.2Dec. 308.6 0.0 0.0 - 0.0 1340.8 0.0 48.3 1697.7

2006Jan. 357.6 0.0 0.0 - 0.0 1340.8 0.0 76.8 1775.3Feb. 326.5 0.0 0.0 - 0.0 1340.8 0.0 33.5 1700.8Mar. 332.7 0.0 0.0 - 0.0 1257.5 0.0 43.8 1634.0

- 1 -

Table 1


Assets and Liabilities

2 - L I A B I L I T I E S


Capital Cur- D e p o s i t s Alloca-and rency Banks Govern- Savings Other tion of Other TotalReserve issued ment Bank SDRs

1981 11.0 69.5 14.4 5.3 7.1 7.4 2.9 4.7 122.31982 11.0 66.0 12.0 1.6 7.1 8.1 2.9 35.1 143.81983 11.0 67.8 18.4 8.5 4.6 8.9 2.9 42.5 164.61984 11.0 73.9 12.5 13.7 - 9.8 2.9 45.7 169.51985 11.0 81.3 25.7 24.4 - 0.7 2.9 50.8 196.81986 11.0 83.0 22.4 28.6 - 0.7 2.9 46.5 195.11987 11.0 87.5 17.4 93.8 - 0.7 2.9 37.8 251.11988 11.0 101.2 32.4 91.3 - 0.4 2.9 20.0 259.21989 11.0 105.3 34.0 26.8 - 0.7 2.9 43.5 224.21990 11.0 111.8 51.5 21.4 - 0.7 2.9 38.6 237.91991 11.0 119.7 85.8 30.3 - 0.8 2.9 34.4 284.91992 11.0 129.8 181.2 64.3 - 0.8 2.9 37.3 427.31993 11.0 141.8 241.4 58.8 - 0.6 2.9 71.5 528.01994 11.0 148.9 417.2 30.9 - 0.6 2.9 90.7 702.31995 11.0 154.2 529.9 21.4 - 0.7 2.9 97.9 818.11996 11.0 174.2 603.8 15.4 - 0.7 2.9 107.1 915.01997 11.0 203.0 720.3 18.1 - 0.7 2.8 120.5 1076.41998 11.0 219.2 248.8 18.2 - 0.7 3.1 222.8 723.91999 22.9 264.3 247.8 66.7 - 0.7 3.0 218.1 823.52000 39.9 282.2 245.7 21.5 - 0.8 3.3 423.6 1017.02001 48.5 299.2 266.7 18.9 - 0.8 2.9 401.2 1038.32002 53.9 321.2 395.8 22.4 - 0.9 2.8 872.8 1669.82003 65.4 326.0 251.8 16.1 - 0.9 3.3 766.7 1430.3

2004Jan. 50.4 316.8 278.6 37.2 - 0.9 3.2 793.4 1480.5Feb. 65.4 318.6 271.4 19.1 - 0.9 3.3 739.5 1418.2Mar. 65.4 301.5 317.9 13.7 - 0.9 3.3 573.8 1276.6

Apr. 65.4 307.4 780.5 13.6 - 0.9 3.2 608.8 1779.9May. 65.4 301.6 811.1 14.0 - 0.9 3.3 607.4 1803.8Jun. 65.4 301.7 725.8 15.1 - 0.9 3.3 619.4 1731.7

Jul. 65.4 303.5 848.2 15.1 - 0.9 3.3 592.7 1829.1Aug. 65.4 302.9 726.5 16.7 - 0.9 3.3 602.3 1718.0Sept. 65.4 302.9 856.3 34.5 - 0.9 3.3 608.1 1871.4

Oct. 65.4 308.8 819.2 17.4 - 0.9 3.4 630.6 1845.7Nov. 65.4 301.8 829.3 17.1 - 0.9 3.4 642.6 1860.5Dec. 21.0 314.5 740.6 16.4 - 0.9 3.5 639.3 1736.3

2005Jan. 65.4 306.8 754.4 17.7 - 1.0 3.4 628.5 1777.2Feb. 65.4 311.0 769.3 21.1 - 1.0 3.4 621.6 1792.8Mar. 21.0 300.4 743.7 23.0 - 1.0 3.4 777.0 1869.4

Apr. 21.0 309.7 745.4 20.2 - 1.0 3.4 656.6 1757.2May. 21.0 300.8 747.3 19.6 - 1.0 3.3 639.9 1732.8Jun. 21.0 300.6 691.0 46.7 - 1.0 3.3 596.4 1659.9

Jul. 21.0 304.4 684.9 78.6 - 1.0 3.2 591.0 1684.2Aug. 21.0 300.6 736.5 22.1 - 1.0 3.3 590.2 1674.7Sept. 21.0 312.3 739.0 31.7 - 1.0 3.2 593.5 1701.8

Oct. 21.0 323.9 729.1 56.0 - 1.0 3.2 577.6 1711.7Nov. 21.0 320.7 743.8 46.6 - 1.0 3.2 552.0 1688.2Dec. 21.0 344.8 746.5 70.7 - 1.0 3.2 510.5 1697.7

2006Jan. 21.0 332.8 770.0 106.8 - 1.0 3.2 540.5 1775.3Feb. 21.0 341.3 702.4 134.4 - 1.0 3.2 497.5 1700.8Mar. 21.0 349.0 741.2 42.4 - 1.0 3.2 476.3 1634.0

- 2 -

Table 2

CONSOLIDATED BALANCE SHEET OF COMMERCIAL BANKS

1 - A S S E T S


Cash Bal- Foreign C l a i m s o n Other at ances assets Private Public assets Total

hand with sector Gov't entities CBS

1981 4.2 14.4 44.8 155.3 39.2 33.8 30.2 321.91982 3.4 12.0 19.2 143.7 36.2 70.1 33.9 318.51983 3.5 18.4 21.3 137.4 48.3 64.9 35.0 328.81984 4.0 12.5 27.0 120.4 69.6 88.1 40.3 361.91985 5.5 25.7 32.1 104.6 (2) 184.2 (2) 25.9 (2) 50.1 428.11986 4.9 22.4 32.5 90.8 270.0 22.9 49.6 493.11987 5.1 17.4 30.8 88.6 335.8 23.3 58.3 559.31988 5.6 32.4 35.5 96.2 411.8 35.7 56.0 673.21989 5.8 34.0 27.3 127.0 526.1 40.3 85.0 845.51990 7.3 51.5 57.5 137.2 547.2 41.4 109.6 951.71991 6.1 85.8 90.5 150.2 633.6 58.4 100.2 1,124.81992 7.3 181.2 49.6 157.8 632.9 54.1 99.6 1,182.51993 7.3 241.4 40.3 172.8 779.0 80.9 116.7 1,438.41994 7.3 417.2 25.0 209.0 692.3 118.9 161.1 1,630.71995 6.1 529.9 48.2 245.1 747.8 92.4 179.2 1,848.71996 8.5 603.8 96.3 269.6 843.1 68.7 243.7 2,133.81997 10.8 720.3 158.7 387.6 1086.9 71.8 459.3 2,895.31998 12.8 248.8 160.1 459.9 2106.7 56.0 453.7 3,498.01999 16.3 247.8 234.7 503.5 2526.6 42.6 369.1 3940.62000 17.8 245.7 322.4 565.6 2805.7 20.2 494.2 4471.62001 19.4 266.7 294.0 643.5 3101.6 10.8 482.9 4818.92002 20.2 395.8 264.1 773.9 3182.4 5.4 628.0 5269.82003 20.1 251.8 248.6 993.8 3335.5 102.8 502.0 5454.7

2004Jan. 19.3 278.6 262.7 1032.7 3232.6 101.0 297.6 5224.7Feb. 18.0 271.4 272.8 1049.4 3237.7 99.1 208.1 5156.6Mar. 17.7 317.9 278.4 1057.3 3231.0 97.6 209.3 5209.2

Apr. 15.5 780.5 288.1 1076.4 2721.6 108.3 273.5 5263.9May. 20.8 811.1 302.6 1096.5 2810.3 111.8 189.5 5342.8Jun. 18.0 725.8 296.8 1110.0 2723.3 114.1 254.9 5242.8

Jul. 16.7 848.2 317.5 1103.5 2501.2 119.7 251.5 5158.2Aug. 18.6 726.5 312.6 1123.5 2695.5 138.5 276.5 5291.7Sept. 16.0 856.3 318.8 1119.6 2547.5 142.5 238.3 5238.9

Oct. 18.7 819.2 350.8 1132.8 2571.2 144.0 229.5 5266.3Nov. 16.6 829.3 322.7 1138.8 2553.7 159.8 248.2 5269.2Dec. 18.7 740.6 315.4 1162.1 2746.6 183.3 249.8 5416.7

2005Jan. 22.4 754.4 314.8 1177.2 2605.9 187.1 239.3 5301.1Feb. 21.1 769.3 295.1 1155.5 2585.1 212.1 269.7 5307.9Mar. 16.4 743.7 324.0 1151.0 2585.9 251.8 287.0 5359.7

Apr. 16.7 745.4 311.1 1177.8 2618.6 224.8 285.9 5380.2May. 20.7 747.3 334.9 1192.5 2604.8 234.2 276.8 5411.0Jun. 18.2 691.0 370.7 1181.1 2570.9 297.7 279.4 5408.9

Jul. 16.0 684.9 372.7 1173.3 2653.7 285.2 270.6 5456.5Aug. 19.0 736.5 404.5 1182.0 2548.9 271.6 296.2 5458.7Sept. 22.1 739.0 410.3 1189.0 2523.3 258.5 283.5 5425.7

Oct. 22.6 729.1 403.3 1198.4 2631.4 264.2 206.5 5455.4Nov. 18.6 743.8 408.0 1230.3 2641.0 286.9 255.1 5583.5Dec. 19.2 746.5 397.5 1247.3 2638.5 296.8 287.6 5633.5

2006Jan. 20.5 770.0 397.1 1242.2 2702.7 300.5 282.0 5715.0Feb. 18.0 702.4 395.7 1244.7 2734.0 302.5 330.4 5727.7Mar. 25.0 741.2 506.2 1177.6 2735.0 327.5 354.9 5867.3

(1) Figures revised as of December 2002.(2) Changes reflect in part the reclassification to claims on Government of R58.3 million of restructured

loans and advances, previously made to public entities (R 56.2 million) and the private sector ( R 2.1

million) responsibility for repayment of which has been assumed by Government.

- 3 -

Table 2

CONSOLIDATED BALANCE SHEET OF COMMERCIAL BANKS

2 - L I A B I L I T I E S (1)


D e p o s i t s For- Borr- eign rowings Other

D e m a n d T i m e Sav- Foreign liabi- fromings currency lities CBS

Public Public Pri- Gov't enti- Pri- Gov't enti- vate ties vate ties

(2)

1981 60.1 3.9 18.1 47.2 7.5 35.5 66.6 - 22.7 10.5 49.81982 52.4 3.1 13.1 52.4 11.7 22.3 65.2 - 25.4 13.8 59.11983 42.6 3.9 11.0 71.1 13.3 23.1 64.0 - 24.8 13.7 61.31984 42.1 7.2 13.0 81.1 12.4 37.5 69.3 - 17.9 9.6 71.81985 45.5 5.9 33.3 90.3 15.3 35.6 82.2 - 23.6 6.5 89.91986 51.8 12.9 24.4 113.1 21.1 49.8 87.4 - 20.2 20.7 91.71987 45.8 14.7 26.3 144.1 33.6 48.6 93.2 - 25.4 13.7 113.91988 58.0 10.0 33.8 184.6 50.1 49.8 117.3 - 25.1 21.4 123.11989 79.3 12.1 40.1 218.3 72.2 73.8 120.8 - 42.9 30.7 155.31990 72.5 4.4 39.1 276.1 41.6 76.3 154.9 - 59.1 18.5 209.21991 93.0 13.6 58.8 301.4 66.5 65.3 174.7 - 70.6 13.0 267.91992 103.6 24.2 66.4 342.3 59.7 51.6 226.4 - 35.5 4.0 268.81993 126.2 15.8 74.5 433.2 91.9 56.7 278.6 - 38.5 21.5 301.51994 110.8 20.3 73.6 419.7 98.5 49.7 299.3 - 31.9 7.0 520.01995 119.2 36.8 67.0 492.2 76.0 57.5 325.4 - 50.4 1.8 622.41996 206.5 24.0 77.5 596.0 64.5 60.8 282.2 - 89.7 0.0 732.51997 338.7 44.1 117.8 819.7 119.1 107.0 412.5 - 171.2 0.0 765.31998 449.7 39.2 124.5 1004.9 141.7 119.0 484.9 - 189.2 10.0 934.81999 648.9 47.1 174.4 1127.0 156.4 126.6 584.1 - 252.6 0.0 823.62000 690.3 43.0 182.7 1216.5 161.5 177.5 642.7 - 384.7 22.0 950.62001 778.0 37.8 232.7 1356.1 192.3 183.9 724.2 - 321.8 0.0 992.02002 750.9 51.6 354.6 1363.8 193.7 223.3 744.8 141.4 538.5 0.0 907.02003 787.8 35.2 477.2 1310.3 201.8 227.5 806.7 212.6 440.9 19.0 935.6

2004Jan. 727.4 43.5 530.5 1340.7 203.3 166.5 816.6 208.5 409.1 0.0 778.4Feb. 970.8 38.4 343.0 1263.0 191.8 185.4 851.4 206.6 405.2 0.0 701.1Mar. 974.2 44.8 354.6 1233.1 184.5 264.9 843.7 209.8 389.8 0.0 709.8

Apr. 703.7 44.1 283.9 1230.4 191.2 151.6 822.8 236.0 368.6 0.5 1231.1May. 700.9 55.8 220.8 1091.9 189.6 155.1 828.4 239.2 364.1 245.0 1252.0Jun. 716.4 62.0 264.0 1085.3 184.8 171.7 822.3 231.8 337.5 131.0 1236.2

Jul. 726.2 60.7 250.7 1135.1 173.7 169.2 820.0 214.6 371.1 10.0 1226.9Aug. 673.5 63.0 273.9 1273.4 173.7 161.4 813.0 230.5 370.2 12.0 1247.2Sept. 655.8 61.8 282.6 1281.9 170.8 146.7 810.4 213.8 380.7 0.0 1234.5

Oct. 670.5 79.2 284.6 1233.7 157.0 158.7 812.6 232.3 410.6 0.0 1227.0Nov. 643.4 65.9 267.9 1256.5 160.0 169.1 812.8 233.1 408.2 16.0 1236.2Dec. 647.2 105.5 283.9 1268.7 162.4 152.2 806.9 232.1 423.8 120.0 1214.1

2005Jan. 672.4 108.3 289.9 1253.0 163.4 145.8 815.1 241.5 427.0 0.0 1184.8Feb. 655.8 104.8 298.9 1264.8 160.3 150.5 825.2 177.8 485.1 0.0 1184.8Mar. 687.7 110.4 266.9 1247.4 159.1 155.4 832.4 194.0 483.6 10.0 1212.8

Apr. 696.2 117.1 277.5 1287.1 105.5 165.2 837.5 177.1 531.7 0.0 1185.3May. 715.9 111.5 309.2 1266.2 106.7 163.8 840.1 226.2 484.8 0.0 1186.4Jun. 699.7 104.5 269.3 1283.2 111.1 157.1 835.0 207.4 546.7 0.0 1194.8

Jul. 673.9 104.4 256.8 1332.9 109.2 150.2 838.3 222.6 524.1 31.0 1213.1Aug. 653.8 105.5 265.3 1301.5 108.8 167.0 833.0 236.9 548.9 0.0 1238.0Sept. 689.7 103.3 200.0 1285.7 119.2 165.5 838.8 233.2 566.1 0.0 1224.2

Oct. 712.9 106.0 206.2 1277.3 109.1 154.8 843.1 247.6 582.5 0.0 1215.8Nov. 761.8 104.0 250.8 1304.3 116.2 154.8 847.0 285.0 557.0 0.0 1202.7Dec. 806.7 97.2 264.6 1300.1 123.7 152.8 848.0 255.0 585.4 0.0 1199.9

2006Jan. 790.0 93.2 289.9 1294.4 127.9 132.1 855.7 273.6 588.2 0.0 1270.0Feb. 756.3 85.4 259.2 1250.2 119.3 146.8 876.8 268.4 573.5 0.0 1391.7Mar. 791.3 83.7 290.4 1232.2 118.9 152.5 889.1 279.8 623.5 0.0 1405.9

(1) Figures revised as of December 2002.

(2) Includes Development Bank of Seychelles time deposits with banks.

- 4 -

Table 3

CURRENCY ISSUE AND MONEY (4)

R million - end of period

Currency Currency Demand Money % Currency at with deposits M1 change issued banks public

(1) (2) (3)

1981 69.5 4.2 65.3 78.2 143.5 3.21982 66.0 3.4 62.6 65.5 128.1 -10.71983 67.8 3.5 64.3 53.6 117.9 -8.01984 73.9 4.0 69.9 55.1 125.0 6.01985 81.3 5.5 75.8 78.8 154.6 23.71986 83.0 4.9 78.1 76.2 154.3 -0.21987 87.5 5.1 82.4 72.1 154.5 0.11988 101.2 5.6 95.6 91.8 187.4 21.31989 105.3 5.8 99.5 119.4 218.9 16.81990 111.8 7.3 104.5 111.6 216.1 -1.31991 119.7 6.1 113.6 151.8 265.4 22.81992 129.8 7.3 122.5 170.0 292.5 10.21993 141.8 7.3 134.5 200.7 335.2 14.61994 148.9 7.3 141.6 184.4 326.0 -2.71995 154.2 6.1 148.1 186.2 334.3 2.51996 174.2 8.5 165.6 284.0 449.6 34.51997 203.0 10.8 192.2 456.5 648.7 44.31998 219.2 12.8 206.4 574.2 780.6 20.31999 264.3 16.3 247.9 823.3 1071.2 37.22000 282.2 17.8 264.4 873.1 1137.5 6.22001 299.2 19.4 279.9 1010.7 1290.6 20.52002 321.2 20.2 301.0 1275.9 1576.9 22.22003 326.0 20.1 305.9 1265.0 1570.9 -0.4

2004Jan. 316.8 19.3 297.5 1257.9 1555.4 14.0Feb. 318.6 18.0 300.5 1313.8 1614.3 16.9Mar. 301.5 17.7 283.9 1328.8 1612.7 13.8

Apr. 307.4 15.5 291.9 987.5 1279.4 -16.7May. 301.6 20.8 280.9 921.7 1202.6 -18.6Jun. 301.7 18.0 283.7 980.4 1264.1 -18.3Jul. 303.5 16.7 286.8 976.9 1263.7 -11.0Aug. 302.9 18.6 284.3 947.4 1231.7 -13.0Sept 302.9 16.0 286.8 938.4 1225.2 -12.8Oct. 308.8 18.7 290.1 955.1 1245.2 -21.5Nov. 301.8 16.6 285.2 911.3 1196.5 -25.5Dec. 314.5 18.7 295.8 931.1 1226.9 -21.92005Jan. 306.8 22.4 284.5 962.3 1246.7 -19.8Feb. 311.0 21.1 289.9 954.7 1244.6 -22.9Mar. 300.4 16.4 284.0 954.6 1238.6 -23.2Apr. 309.7 16.7 293.1 973.7 1266.8 -1.0May. 300.8 20.7 280.0 1025.1 1305.2 8.5Jun. 300.6 18.2 282.5 968.9 1251.4 -1.0Jul. 304.4 16.0 288.4 930.7 1219.1 -3.5Aug. 300.6 19.0 281.6 919.1 1200.7 -2.5Sept 312.3 22.1 290.2 889.7 1179.9 -3.7Oct. 323.9 22.6 301.3 919.1 1220.5 -2.0Nov. 320.7 18.6 302.1 1012.5 1314.6 9.9Dec. 344.8 19.2 325.7 1071.4 1397.0 13.92006Jan. 332.8 20.5 312.3 1079.8 1392.2 11.7Feb. 341.3 18.0 323.3 1015.5 1338.8 7.6Mar. 349.0 25.0 324.0 1081.8 1405.7 13.5

For footnotes see "Notes on tables 3 - 5".(4) Figures revised as of December 2002.

- 5 -

Table 4

QUASI MONEY AND MONEY SUPPLY (6)


Quasi Money % Pipeline Money % money supply change deposits supply change

M2 M2(p)

(1) (2) (3) (4) (5)

1981 156.4 299.9 -0.5 - 299.9 -0.51982 147.0 275.1 -8.3 - 275.1 -8.31983 162.8 280.7 2.0 - 280.7 2.01984 187.9 312.9 11.5 - 312.9 11.51985 208.1 362.7 15.9 - 362.7 15.91986 250.3 404.6 11.6 - 404.6 11.61987 285.9 440.4 8.8 - 440.4 8.81988 351.7 539.1 22.4 - 539.1 22.41989 412.9 631.8 17.2 - 631.8 17.21990 507.3 723.4 14.5 - 723.4 14.51991 541.4 806.8 11.5 - 806.8 11.51992 620.3 912.8 13.1 - 912.8 13.11993 768.5 1,103.7 20.9 - 1,103.7 20.91994 768.7 1,094.7 -0.8 198.2 1,292.8 17.11995 875.0 1,209.3 10.5 301.4 1,510.8 16.91996 939.0 1,388.6 14.8 317.1 1,705.7 12.91997 1,339.2 1,987.8 43.2 218.0 2,205.9 29.31998 1,608.9 2,389.5 20.2 178.3 2,567.8 16.41999 1,837.7 2,908.9 21.7 148.0 3,056.9 19.02000 2,036.7 3,174.2 9.1 132.3 3,306.5 8.22001 2,264.2 3,554.8 12.0 127.7 3,682.5 11.42002 2,626.6 4,203.5 18.2 103.3 4,306.8 17.02003 2,549.7 4,120.6 -2.0 102.1 4,222.7 -2.0

2004Jan. 2,524.5 4,080.0 6.3 102.1 4,182.1 6.1Feb. 2,496.8 4,111.1 3.9 34.3 4,145.4 2.1Mar. 2,544.4 4,157.1 3.5 16.5 4,173.5 1.4

Apr. 2,429.7 3,709.1 -10.8 621.3 4,330.4 1.6May 2,307.6 3,510.2 -15.1 625.2 4,135.3 -2.4Jun. 2,305.1 3,569.2 -14.2 617.2 4,186.4 -1.7

Jul. 2,332.6 3,596.3 -11.1 614.0 4,210.3 1.5Aug. 2,470.7 3,702.4 -8.4 615.4 4,317.8 4.1Sept. 2,446.1 3,671.3 -8.8 618.2 4,289.6 3.9Oct. 2,423.7 3,668.9 -11.8 612.0 4,280.9 0.4Nov. 2,458.1 3,654.7 -14.1 595.4 4,250.0 -2.4Dec. 2,452.2 3,679.1 -10.7 589.5 4,268.5 1.12005Jan. 2,438.1 3,684.8 -9.7 581.5 4,266.3 2.0Feb. 2,412.7 3,657.3 -11.0 566.2 4,223.4 1.9Mar. 2,420.2 3,658.8 -12.0 555.8 4,214.6 1.0Apr. 2,460.5 3,727.3 0.5 544.1 4,271.3 -1.4May 2,490.8 3,796.0 8.1 535.4 4,331.4 4.7Jun. 2,475.9 3,727.4 4.4 530.1 4,257.5 1.7Jul. 2,529.4 3,748.4 4.2 536.1 4,284.5 1.8Aug. 2,527.9 3,728.6 0.7 534.8 4,263.4 -1.3Sept. 2,517.2 3,697.1 0.7 530.0 4,227.1 -1.5Oct. 2,512.9 3,733.4 1.8 523.1 4,256.5 -0.6Nov. 2,583.4 3,898.0 6.7 513.4 4,411.3 3.8Dec. 2,547.1 3,944.1 7.2 498.4 4,442.5 4.12006Jan. 2,547.2 3,939.4 6.9 475.8 4,415.1 3.5Feb. 2,533.8 3,872.6 5.9 464.3 4,336.9 2.7Mar. 2,534.3 3,940.0 7.7 463.1 4,403.0 4.5

For footnotes see "Notes on tables 3 - 5".(6) Figures revised as of December 2002.

- 6 -

Table 5

CREDIT-DEPOSIT RATIO OF COMMERCIAL BANKS (5)


Total Total

comm'l % comm'l % Credit

bank change bank change deposit

credit deposits ratio

(1) (2) (3) (4)

1981 228.3 15.5 238.9 -0.9 95.61982 250.0 9.5 220.2 -7.8 113.51983 250.6 0.2 229.0 4.0 109.41984 278.1 11.0 262.6 14.7 105.91985 314.7 13.2 308.1 17.3 102.11986 383.7 21.9 360.5 17.0 106.41987 447.7 16.7 406.3 12.7 110.21988 543.7 21.4 503.6 23.9 108.01989 693.4 27.5 616.6 22.4 112.51990 725.8 4.7 664.9 7.8 109.21991 842.2 16.0 773.3 16.3 108.91992 844.8 0.3 874.2 13.0 96.61993 1,032.7 22.2 1,076.9 23.2 95.91994 1,020.2 -1.2 1,071.9 -0.1 95.21995 1,085.3 6.4 1,174.1 9.5 92.41996 1,181.4 8.9 1,311.5 11.7 90.11997 1,546.2 30.9 1,958.9 49.4 78.91998 2,622.6 69.6 2,364.0 20.7 110.91999 3,072.7 17.2 2,864.5 21.2 107.32000 3,391.5 10.4 3,114.3 8.7 108.92001 3,755.9 10.7 3,505.1 12.5 107.22002 3,941.2 4.9 3,824.2 9.1 103.12003 4,430.2 12.4 4,059.1 6.1 109.1

2004Jan. 4,366.2 7.6 4,037.1 5.5 108.2Feb. 4,386.0 8.0 4,050.2 2.8 108.3Mar. 4,385.9 6.2 4,109.6 3.0 106.7

Apr. 3,905.9 -6.5 3,663.6 -10.2 106.6May. 4,017.8 -5.4 3,481.7 -16.7 115.4Jun. 3,945.3 -8.9 3,538.2 -15.2 111.5

Jul. 3,722.4 -16.7 3,550.3 -12.8 104.8Aug. 3,955.6 -9.9 3,662.4 -10.1 108.0Sept. 3,807.6 -14.0 3,623.8 -10.6 105.1

Oct. 3,848.0 -12.8 3,628.7 -11.7 106.0Nov. 3,852.3 -11.4 3,608.8 -14.0 106.7Dec. 4,092.1 -7.6 3,658.8 -9.9 111.8

2005Jan. 3,970.3 -9.1 3,689.3 -8.6 107.6Feb. 3,952.6 -9.9 3,638.1 -10.2 108.6Mar. 3,988.7 -9.1 3,653.4 -11.1 109.2

Apr. 4,021.2 3.0 3,663.2 -0.0 109.8May. 4,031.4 0.3 3,739.8 7.4 107.8Jun. 4,049.6 2.6 3,667.4 3.6 110.4

Jul. 4,112.2 10.5 3,688.3 3.9 111.5Aug. 4,002.5 1.2 3,671.8 0.3 109.0Sept. 3,970.8 4.3 3,635.3 0.3 109.2

Oct. 4,094.0 6.4 3,657.1 0.8 111.9Nov. 4,158.1 7.9 3,823.8 6.0 108.7Dec. 4,182.7 2.2 3,848.2 5.2 108.7

2006Jan. 4,245.4 6.9 3,856.8 4.5 110.1Feb. 4,281.1 8.3 3,762.5 3.4 113.8Mar. 4,240.0 6.3 3,837.9 5.1 110.5

(5) Figures revised as of December 2002.

- 7 -

Notes on Tables 3 - 5

The tables cover the six commercial banks and Central Bank of Seychelles. They provide separate data for the three types of money aggregate (M1, M2 and M2(p)).

Table 3

1 - Includes demand deposits of public entities and private sector, government deposits areexcluded.

2 - This is money in its narrow sense : currency with the public plus demand-deposits.

3 - Changes are shown in percentages over a year earlier.

Table 4

1 - This consists of private sector and public entities of savings, time and foreign currency deposits of residents in the banking system.

2 - This is money supply (M2), or money (M1) plus quasi money. Government deposits are excluded.


4 - These are deposits of commercial banks' customers put against a foreign exchange request. These funds are transfered to the Central Bank.

5 - This is money supply in its broadest sense (M2(p)) comprising all bank deposits (public or private, demand, time or savings) plus foreign currency deposits of residents and currency

with the public.

Table 5

1 - The series on bank credit are derived from Table 2.


3 - Data are derived from Table 2.

4 - Credit extended by the commercial banks as per cent of the total deposits with them are shown in this column.

- 8 -

CBS lendin

ConcessionaTemporary aCBS lendingHighLowSecondary CBS buying CBS selling CommerciaConcessionaVolume-weig Savings d Time depo 7 days >7 ≤ >3 ≤ >6 ≤ > 12 mVolume-weig

Developmen

Treasury bi91-day 4/91-day 5/91-day 6/182-day 4/365-day 4/365-day 8/Stocks: 1/78½%Sey sto8% Sey stoc8% Sey stoc8% Sey StocBonds (ave2.25% 1yr T4.0% 3yr Tre5.0% 5yr Tre6.0% 1yr Tre6.75% 2yr T6.75% 2yr T6.75% 2yr T7.0% 7yr Tre7.5% 3yr Tre7.5% 3yr Tre7.5% 3yr Tre8.0% 5yr Tre8.0% 10yr T8.25% 5yr T11.0% 3yr T11.5% 5yr T12.0% 3yr T1/ Annual and 2/ Simple avera3/ The low rate4/ With effect f5/ With effect f6/ With effect f7/ Average rate8/ With effect f

Table 6Interest Rates; 1999 - 2005

1999 2000 2001 2002 2003 2004 2005 2006 2 0 0 4 2 0 0 5 2006 2 0 0 5 2 0 0 6Avg Avg Avg Avg Avg Avg Avg Avg Q3 Q4 Q1 Q2 Q3 Q4 Q1 Mar Dec Jan Feb Mar

(Per cent)ng rates to banks: 1/

ary re-finance scheme 1.00 1.00 1.00 1.00 1.00 1.00 - - - - - - - - - - - - - -advances against treasury bills 2/ 5.50 5.50 5.50 5.50 4.84 4.10 3.67 3.69 2.98 3.26 3.55 3.66 3.69 3.77 3.69 3.56 3.87 3.89 3.38 3.38

ng rates to government: 1/3/ -5.00 5.00 5.00 5.00 5.00 5.00 6.88 7.50 5.00 5.00 5.00 7.50 7.50 7.50 7.50 5.00 7.50 7.50 7.50 7.505.00 5.00 5.00 5.00 5.00 5.00 4.63 5.00 5.00 5.00 5.00 4.50 4.50 4.50 5.00 5.00 4.50 5.00 5.00 5.00

market rates for treasury bills: 1/2/ -g rates 5.13 5.13 5.13 5.13 4.90 5.56 - - - - - - - - - - - - - -

rates 4.88 4.88 4.88 4.88 4.65 5.31 - - - - - - - - - - - - - -al banks with public: -ary re-finance scheme 1/ 3.00 3.00 3.00 3.00 3.00 3.00 - - - - - - - - - - - - - -ghted average deposits rates: 1/ -deposits 3.00 3.02 3.03 3.03 2.85 2.88 2.98 2.80 3.09 2.75 3.00 2.95 2.98 2.97 2.80 3.00 2.97 2.84 2.78 2.78posits: -s 2.93 2.79 2.89 2.78 2.39 2.28 1.91 2.05 1.69 1.78 1.89 1.85 1.89 2.01 2.05 1.88 2.07 2.02 2.13 1.99 3 months 5.13 4.77 4.92 4.93 3.99 3.55 3.72 3.06 3.65 3.86 4.44 4.39 3.05 3.00 3.06 4.37 3.07 3.12 3.03 3.02 6 months 4.71 4.76 4.98 4.98 4.22 3.78 3.21 2.72 3.53 4.13 3.44 2.92 3.13 3.35 2.72 3.16 3.31 2.87 2.81 2.49 12 months 5.05 4.29 4.31 4.34 3.98 3.32 3.19 2.80 3.48 3.22 3.12 3.24 3.30 3.10 2.80 3.15 3.02 2.81 2.75 2.82

months 7.05 6.46 4.80 4.26 3.75 3.04 2.99 3.00 3.01 3.01 3.01 3.01 3.01 2.95 3.00 3.01 3.01 3.00 3.00 3.00ghted average lending rate 1/ 12.01 11.45 11.14 11.09 11.08 10.13 9.98 10.06 10.09 9.94 9.94 9.90 9.98 10.12 10.06 9.97 10.13 10.06 10.13 10.00

ent Bank of Seychelles lending rates: 1/ 8.75 8.75 8.75 8.75 8.75 8.25 8.25 8.25 8.25 8.25 8.25 8.25 8.25 8.25 8.25 8.25 8.25 8.25 8.25 8.25

ills (averages): 1/2/ 5.00 5.00 5.00 5.00 3.40 3.74 3.34 3.58 2.48 3.21 3.24 3.33 3.35 3.44 3.58 3.25 3.59 3.60 3.57 3.574.50 4.50 4.50 4.50 4.50 - - - - - - - - - - - - - - -- - - - 2.02 2.02 - - - - - - - - - - - - - -- - - - - 2.34 2.82 2.92 2.48 2.59 2.65 2.82 2.87 2.92 2.92 2.67 2.93 2.97 2.90 2.90

/ 4.99 4.99 4.99 4.99 4.99 4.99 - - - - - - - - - - - - - -/ 5.50 5.50 5.50 5.50 5.50 5.50 - - - - - - - - - - - - - -/ - - - - - 3.84 3.87 4.24 - 3.84 3.84 3.84 3.84 3.97 4.24 3.84 4.24 4.24 4.24 4.247/ 8.16 8.15 8.11 8.11 8.11 8.10 8.10 8.10 8.10 8.10 8.10 8.10 8.10 8.10 8.10 8.10 8.10 8.10 8.10 8.10ock 2005-07 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50 8.50ck 2004 8.00 8.00 8.00 8.00 8.00 - - - - - - - - - - - -ck 2009 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00

ock 2014 - - - - - 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00erages): 1/ 8.69 8.22 8.14 8.13 6.82 5.96 6.45 6.45 5.96 6.30 6.00 6.45 6.45 6.45 6.45 6.00 6.45 6.45 6.45 6.45Treasury bonds series V - - - - 2.25 2.25 - - 2.25 - - - - - - - - - - -reasury bonds series W - - - - 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00reasury bonds series X - - - - 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00reasury bonds series R 6.00 - - - - - - - - - - - - - - - - - - -Treasury bonds series Q 6.75 6.75 6.75 - - - - - - - - - - - - - - - - -Treasury bonds series S 6.75 6.75 6.75 - - - - - - - - - - - - - - - - -Treasury bonds series U - 6.75 6.75 6.75 6.75 - - - - - - - - - - - - - - -reasury bonds series Y - - - - 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00reasury bonds series P 7.50 7.50 7.50 7.50 7.50 - - - - - - - - - - - - - - -reasury bonds series T - 7.50 7.50 7.50 7.50 - - - - - - - - - - - - - - -reasury bonds series N* - - 7.50 7.50 7.50 7.50 - - 7.50 7.50 - - - - - - - - - -reasury bonds series O 8.00 8.00 8.00 8.00 8.00 8.00 - - 8.00 - - - - - - - - - - -Treasury bonds series Z - - - - 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00 8.00Treasury bonds series Esmeralda II - - - - - - 8.25 8.25 - - - 8.25 8.25 8.25 8.25 - 8.25 8.25 8.25 8.25Treasury bonds series M 11.00 11.00 11.00 - - - - - - - - - - - - - - - - -Treasury bonds series N 11.50 11.50 11.50 11.50 11.50 - - - - - - - - - - - - - - -Treasury bonds series H 12.00 - - - - - - - - - - - - - - - - - - - quarterly rates are averages of monthly data, compiled on an end-of-period basisrageses apply to Central Bank advances to the government for the first R100 million, and the high rates to advances exceeding R 100 million.from September 15, 1998, new issues of 91 day, 182 day, 365 day bills were issued on tap.from July 15, 2003, new issue of 91 day, available to Commercial Banks only.from January 13, 2004, new 91 day bills were issued on tender .tes weighted by volume sold during period.from December 20, 2004, new 365 day bills were issued on tender .

- 9 -

Table 7Distribution of Commercial Bank Credit; 2001 - 2006 1/

2001 2002 2003 2004 2005 * 2 0 0 5 2006 2001 2002 2003 2004 2005 2 0 0 5 2006Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1

R million Per cent

TOTAL 625.4 716.1 917.5 1,226.1 1,443.8 1,378.2 1,436.0 1,453.2 1,507.9 1,531.6 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

(of which, public entities) 12.2 7.2 40.5 126.6 255.9 217.0 252.2 271.8 282.6 310.2 1.9 1.0 4.4 10.3 17.7 15.7 17.6 18.7 18.7 20.2

Agriculture and horticulture 3.6 4.4 3.0 2.2 1.9 1.6 1.7 2.7 1.6 1.7 0.6 0.6 0.3 0.2 0.1 0.1 0.1 0.2 0.1 0.1


Building and construction 31.2 37.9 46.0 65.6 90.1 92.7 101.5 81.6 84.8 85.8 5.0 5.3 5.0 5.3 6.2 6.7 7.1 5.6 5.6 5.6


Financial Institutions 7.3 0.4 13.3 97.9 173.1 144.3 178.4 169.0 200.5 224.2 1.2 0.1 1.5 8.0 12.0 10.5 12.4 11.6 13.3 14.6


Fishing 6.3 8.2 10.6 10.6 10.0 10.8 11.4 9.7 8.2 8.7 1.0 1.1 1.2 0.9 0.7 0.8 0.8 0.7 0.5 0.6


Manufacturing 5.2 7.7 10.4 9.0 7.5 7.7 7.8 7.6 6.7 8.1 0.8 1.1 1.1 0.7 0.5 0.6 0.5 0.5 0.4 0.5


Real estate 32.8 36.2 46.1 71.8 80.1 77.5 81.6 81.4 79.9 80.2 5.2 5.1 5.0 5.9 5.5 5.6 5.7 5.6 5.3 5.2


Tourism 130.5 171.0 264.9 345.1 393.9 373.2 372.9 403.6 426.0 418.9 20.9 23.9 28.9 28.1 27.3 27.1 26.0 27.8 28.3 27.4


Trade 40.5 51.5 65.3 85.9 106.3 126.1 112.9 88.2 97.9 105.4 6.5 7.2 7.1 7.0 7.4 9.2 7.9 6.1 6.5 6.9


Transport 5.7 3.6 6.2 7.1 6.0 6.7 6.1 5.7 5.4 4.8 0.9 0.5 0.7 0.6 0.4 0.5 0.4 0.4 0.4 0.3


Others 69.1 71.9 93.9 147.0 193.2 153.0 178.2 226.5 215.2 214.1 11.0 10.0 10.2 12.0 13.4 11.1 12.4 15.6 14.3 14.0


Private Households 133.5 150.6 166.0 155.2 156.0 153.2 155.1 153.4 162.1 165.1 21.3 21.0 18.1 12.7 10.8 11.1 10.8 10.6 10.8 10.8

Mortgage Loans 159.8 172.7 191.8 228.8 225.8 231.5 228.2 224.0 219.6 214.7 25.6 24.1 20.9 18.7 15.6 16.8 15.9 15.4 14.6 14.0

1/ Annual data and quarterly data are averages of monthly data compiled on an end-of-period basis.

- 10 -

Table 8

MONETARY SURVEY


1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2 0 0 5 2006Dec Mar. Jun. Sep. Dec. Mar.

Foreign Assets ( 1) 150.7 109.2 107.4 93.3 49.9 -87.0 -68.9 -194.6 -190.5 -721.3 -516.5 -414.5 -475.1 -375.4 -299.7 -273.7 -168.8

Central Bank, net 148.9 116.1 109.6 86.7 62.4 -57.9 -51.0 -132.3 -162.6 -450.3 -324.2 -306.2 -315.5 -199.4 -143.9 -85.7 -51.5Commercial Banks,net 1.8 -6.9 -2.2 6.6 -12.5 -29.1 -17.9 -62.3 -27.8 -271.0 -192.3 -108.3 -159.6 -176.0 -155.8 -188.0 -117.3

Domestic Assets 1168.2 1399.7 1614.3 1868.0 2291.7 2993.9 3442.7 3864.3 4280.9 4965.1 5177.1 5200.7 5275.3 5133.9 5064.0 5223.0 5233.2

Claims on private sector 172.8 209.0 245.1 269.6 387.6 459.9 503.4 565.6 643.5 753.5 993.8 1162.1 1151.0 1181.1 1189.0 1247.3 1177.6Claims on public entities 80.9 118.9 92.4 68.7 71.8 56.0 42.6 20.2 10.8 5.4 100.9 183.3 251.8 297.7 258.5 296.8 327.5Claims on Government, net (2) 914.5 1071.8 1276.9 1529.7 1832.4 2478.1 2896.7 3278.5 3626.6 4206.3 4082.5 3855.3 3872.5 3655.1 3616.5 3678.8 3728.2

Money Supply M2(p) 1103.7 1292.8 1510.8 1705.7 2205.9 2291.2 3056.9 3306.5 3682.5 4165.4 4222.7 4268.5 4214.6 4257.5 4227.1 4442.5 4403.0

Money Supply M2 1103.7 1094.7 1209.3 1388.6 1987.8 2112.9 2908.9 3174.2 3554.8 4062.1 4120.6 3679.1 3658.8 3727.4 3697.1 3944.1 3940.0

Money 335.2 326.0 334.3 449.6 648.7 715.4 1071.2 1137.5 1290.6 1576.9 1570.9 1226.9 1238.6 1251.4 1179.9 1397.0 1405.7Currency with public 134.5 141.6 148.1 165.6 192.2 206.4 247.9 264.4 279.9 301.0 305.9 295.8 284.0 282.5 290.2 325.7 324.0Demand deposits 200.7 184.4 186.2 284.0 456.5 509.0 823.3 873.1 1010.7 1275.9 1265.0 931.1 954.6 968.9 889.7 1071.4 1081.8(of which, public entities) (74.5) (73.6) (67.0) (77.5) (117.8) (124.5) (174.4) (182.7) (232.7) (354.7) (477.2) (283.9) (266.9) (269.3) (200.0) (264.6) (290.4)

Quasi Money 768.5 768.7 875.0 939.0 1339.2 1397.5 1837.7 2036.7 2264.2 2485.2 2549.7 2452.2 2420.2 2475.9 2517.2 2547.1 2534.3

Time deposits 489.9 469.4 549.7 656.8 926.6 996.8 1253.6 1383.3 1540.0 1693.8 1537.8 1420.9 1402.8 1440.4 1451.1 1452.9 1384.6(of which public entities) (56.7) (49.7) (57.5) (60.8) (107.0) (119.0) (126.6) (177.5) (183.9) (223.3) (227.5) (152.2) (155.4) (157.1) (165.5) (152.8) (152.5)Savings deposits 278.6 299.3 325.4 282.2 412.5 400.7 584.1 653.4 724.2 791.4 806.7 805.6 831.2 834.4 838.8 847.9 889.1Foreign Currency deposits - - - - - - - - - 0.0 205.2 225.7 186.2 201.2 227.3 246.2 260.5

Pipeline Deposit - 198.2 301.4 317.1 218.0 178.3 148.0 132.3 127.7 103.3 102.1 589.5 555.8 530.1 530.0 498.4 463.1

Other items, net 215.2 216.0 211.0 255.6 135.7 615.7 316.9 363.2 407.9 78.4 437.9 517.7 585.6 501.0 537.2 506.9 661.3

(1) Figures revised as of 1993.

(2) Changes in 1985 reflect in part the reclassification to claims on Government of R 58.3 million of restructured loans and advances, previously made to public entities(R 56.2 million) and the private sector (R 2.1 million) responsibility for repayment of which has been assumed by Government.Claims on Government are net of deposits with the banking system.

- 11 -

Table 9OWNERSHIP OF COMMERCIAL BANK DEPOSITS


1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2 0 0 5 2006Dec. Mar. Jun. Sep. Dec. Mar.

Residents 823 1,014 999 1,108 1,253 1,883 2,254 2,742 2,936 3,314 3,738 4,005 3,570 3,711 3,714 3,700 3,906 4,040

Public sector 202 239 242 237 223 392 432 503 567 648 815 940 673 676 617 604 681 795

Private sector 621 775 757 871 1,029 1,491 1,821 2,239 2,370 2,666 2,923 3,065 2,897 3,036 3,097 3,096 3,225 3,245

Individuals 450 544 583 648 743 999 1,117 1,245 1,323 1,411 1,510 1,522 1,415 1,492 1,536 1,460 1,484 1,555Business firms 153 211 156 203 265 467 676 954 1,006 1,208 1,370 1,495 1,442 1,499 1,530 1,601 1,702 1,655Other 18 20 18 19 21 24 28 39 41 47 42 47 40 45 32 34 39 35

Non-residents 51 63 73 66 65 93 135 164 212 221 295 363 364 415 493 515 542 575

Individuals 25 32 38 40 45 60 65 71 73 80 190 231 171 177 205 191 191 373Business firms 24 27 32 23 16 29 67 89 136 132 100 121 184 229 278 312 341 192Other 2 4 3 3 4 4 3 3 2 9 6 12 9 9 10 11 10 11

Total 874 1,077 1,072 1,174 1,318 1,976 2,388 2,906 3,148 3,535 4,033 4,368 3,935 4,127 4,207 4,215 4,448 4,615

- 12 -

Table 10

COMMERCIAL BANKS RESERVES ANDMINIMUM RESERVES REQUIRED (1)

R Thousand

Reserves MinimumWeek ended held Reserves Excess

(daily average) Required

2005

Jan. 2 152,684 91,912 60,772 " 9 131,197 91,701 39,496 " 16 212,190 91,867 120,323 " 23 220,687 92,459 128,228 " 30 199,052 93,034 106,018

Feb. 6 180,809 92,802 88,007 " 13 210,583 92,137 118,446 " 20 218,965 92,521 126,444 " 27 216,188 92,860 123,328

Mar. 6 225,488 92,742 132,746 " 13 210,148 92,949 117,199 " 20 197,512 92,958 104,554 " 27 190,994 92,378 98,616

Apr. 3 190,712 92,202 98,510 " 10 210,924 92,295 118,629 " 17 204,948 92,413 112,535 " 24 210,561 92,236 118,325

May. 1 199,149 93,289 105,860 " 8 208,517 93,540 114,977 " 15 213,962 92,703 121,259 " 22 206,731 93,220 113,511 " 29 218,999 93,607 125,392

Jun. 5 210,114 93,544 116,570 " 12 220,493 93,609 126,884 " 19 197,638 94,308 103,330 " 26 185,870 94,018 91,852

Jul. 3 160,846 93,210 67,636 " 10 190,106 92,555 97,551 " 17 159,589 92,552 67,037 " 24 152,719 93,361 59,358 " 31 157,288 93,734 63,554

Aug. 7 176,767 93,353 83,414 " 14 198,151 93,193 104,958 " 21 190,338 93,783 96,555 " 28 208,588 93,954 114,634

Sept. 4 204,886 93,395 111,491 " 11 228,969 92,447 136,522 " 18 235,272 92,396 142,876 " 25 219,455 92,824 126,631

Oct. 2 211,134 92,733 118,401 " 9 189,817 91,940 97,877 " 16 146,126 91,533 54,593 " 23 156,672 91,987 64,685 " 30 178,973 92,442 86,531

Nov. 6 215,949 92,272 123,677 " 13 236,525 92,005 144,520 " 20 222,626 92,715 129,911 " 27 285,674 93,190 192,484

Dec. 4 232,224 93,997 138,227 " 11 250,762 94,880 155,882 " 18 251,174 95,116 156,058 " 25 245,698 95,198 150,500

2006

Jan. 1 244,081 95,243 148,838 " 8 255,345 94,755 160,590 " 15 261,631 94,318 167,313 " 22 283,461 95,493 187,968 " 29 294,690 96,230 198,460

Feb. 5 302,366 95,962 206,404 " 12 337,309 96,264 241,045 " 19 343,416 96,841 246,575 " 26 295,621 97,041 198,580

Mar. 5 245,973 96,087 149,886 " 12 261,994 94,858 167,136 " 19 273,557 94,884 178,673 " 26 266,113 96,154 169,959

(1) Minimum reserves which commercial banks are required to maintain by way of deposits with the Central Bank against deposit liabilities other than inter-bank deposits were changed from 7 percent to the following :

(a) 8 percent on and after March 4, 1991(b) 9 percent on and after April 1, 1991(c) 10 percent on and after May 6, 1991 (d) 20 percent on and after November 16, 1992 (e) 2.5 percent on and after September 15, 1998

- 13 -

Table 11

DEVELOPMENT BANK OF SEYCHELLES

L I A B I L I T I E S A S S E T S End Assigned Deposits C l a i m s o n of Capital Reserves Other TOTAL with other Private Public Otherperiod banks in Seychelles sector entities

2000 39.2 114.4 107.6 261.3 31.3 202.1 13.6 14.4 2001 39.2 130.9 115.6 285.7 30.6 217.9 7.9 22.6 2002 39.2 143.9 123.3 306.4 25.2 252.3 4.1 18.3 2003 39.2 157.7 129.0 325.8 36.6 267.4 0.8 14.6

2004Jul. 39.2 126.2 151.1 316.4 37.7 264.2 0.0 14.5Aug. 39.2 126.3 151.0 316.5 39.6 262.5 0.0 14.5Sep. 39.2 126.1 151.4 316.6 31.9 270.2 0.0 14.5

Oct. 39.2 126.1 151.3 316.5 29.9 272.0 0.0 14.6Nov. 39.2 125.4 153.3 317.8 27.8 275.8 0.0 14.3Dec. 39.2 125.2 153.9 318.3 17.4 286.4 0.0 14.5

2005Jan. 39.2 131.4 165.6 336.3 16.6 305.6 0.0 14.1Feb. 39.2 131.3 165.6 336.1 18.2 305.9 0.0 11.9Mar. 39.2 131.3 165.7 336.2 17.9 306.5 0.0 11.8

Apr. 39.2 128.6 168.3 336.1 15.5 308.8 0.0 11.8May. 39.2 128.5 168.3 336.0 23.4 300.5 0.0 12.0Jun. 39.2 128.7 167.2 335.0 22.0 301.0 0.0 12.0

Jul. 39.2 128.4 167.5 335.1 19.6 303.4 0.0 12.1Aug. 39.2 128.1 167.3 334.6 19.8 302.8 0.0 12.0Sep. 39.2 128.1 167.8 335.1 21.3 301.8 0.0 11.9

Oct. 39.2 128.3 166.9 334.4 24.8 296.8 0.0 12.8Nov. 39.2 128.8 166.4 334.4 21.3 300.4 0.0 12.7Dec. 39.2 130.1 166.1 335.4 21.4 301.4 0.0 12.6

2006Jan. 39.2 157.1 157.1 353.5 24.1 317.0 0.0 12.4Feb. 39.2 157.0 157.0 353.2 26.3 314.4 0.0 12.5Mar. 39.2 156.8 183.1 379.1 55.2 311.7 0.0 12.3

- 14 -

Table 12

Treasury Bills; 2004 - 2006

2004 2005 2006 2 0 0 4 2 0 0 5 2006 2 0 0 6

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Jan Feb Mar

(R million)

Amount sold 1/ 5,047.2 4,925.3 1,171.1 795.8 1,397.9 1,291.9 1,561.7 1,223.3 1,201.9 1,163.4 1,336.7 1,171.1 376.7 794.4 0.0

91-day bills (Tender) 4,854.6 4,733.4 1,171.1 795.8 1,397.9 1,291.9 1,369.1 1,223.3 1,201.9 1,163.4 1,144.8 1,171.1 376.7 794.4 0.0

365-day bills (Tender) 192.6 191.9 0.0 - - - 192.6 0.0 0.0 0.0 191.9 0.0 0.0 0.0 0.0

Amount redeemed 1/ 3,485.5 5,150.3 1,144.8 - 795.8 1,397.9 1,291.9 1,369.1 1,223.3 1,201.9 1,356.0 1,144.8 350.7 794.1 0.0

91-day bills (Tender) 3,485.5 4,957.7 1,144.8 - 795.8 1,397.9 1,291.9 1,369.1 1,223.3 1,201.9 1,163.4 1,144.8 350.7 794.1 0.0

365-day bills (Tender) - 192.6 0.0 - - - - - - - 192.6 0.0 0.0 0.0 0.0

Discount paid 20.0 41.3 8.4 0.0 4.2 7.7 8.1 8.9 8.2 8.5 15.7 8.4 2.5 5.9 0.0

91-day bills (Tender) 20.0 33.9 8.4 0.0 4.2 7.7 8.1 8.9 8.2 8.5 8.3 8.4 2.5 5.9 0.0

365-day bills (Tender) - 7.4 0.0 - - - - - - - 7.4 0.0 0.0 0.0 0.0

Stock outstanding 1/3/ 1,561.7 1,336.7 1,363.0 795.8 1,397.9 1,291.9 1,561.7 1,415.9 1,394.5 1,356.0 1,336.7 1,363.0 1,362.7 1,363.0 1,363.0

91-day bills (Tender) 1,369.1 1,144.8 1,171.1 795.8 1,397.9 1,291.9 1,369.1 1,223.3 1,201.9 1,163.4 1,144.8 1,171.1 1,170.8 1,171.1 1,171.1

365-day bills (Tender) 192.6 191.9 191.9 - - - 192.6 192.6 192.6 192.6 191.9 191.9 191.9 191.9 191.9

Stock outstanding 2/3/ 1,577.9 1,353.2 1,379.5 800.0 1,405.6 1,300.0 1,577.9 1,431.5 1,410.5 1,371.7 1,353.2 1,379.5 1,379.5 1,379.5 1,379.5

91-day bills (Tender) 1,377.9 1,153.2 1,179.5 800.0 1,405.6 1,300.0 1,377.9 1,231.5 1,210.5 1,171.7 1,153.2 1,179.5 1,179.5 1,179.5 1,179.5

365-day bills (Tender) 200.0 200.0 200.0 - - - 200.0 200.0 200.0 200.0 200.0 200.0 200.0 200.0 200.0

Held by; 2/3/ 0.0 0.0 0.0 0.0 0.0 -0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

CBS - - - - - - - - - - - - - - -

Commercial banks 1,523.3 1,315.7 1,344.3 755.9 1,275.5 1,296.0 1,523.3 1,354.3 1,340.5 1,293.0 1,315.7 1,344.3 1,372.0 1,344.3 1,344.3

Other financial institutions 0.0 0.0 0.0 4.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Others 54.6 37.5 35.1 40.1 130.0 4.0 54.6 77.2 70.0 78.7 37.5 35.1 7.5 35.1 35.1

1/ At cost value.

2/ At face value.

3/ End of period data.

Note: With effect from January 2004 and December 2004, there were re-introductions of tender for 91-day and 365-day respectively.

- 15 -

Table 13

Treasury Bonds; 2004 - 2006

2004 2005 2006 2 0 0 4 2 0 0 5 2006 2 0 0 6

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Jan Feb Mar

Amount sold 667.7 137.9 38.8 179.0 85.3 344.6 58.8 15.8 12.0 13.3 96.8 38.8 8.8 4.6 25.4

4.0%, 3-yr 374.9 16.8 31.1 122.7 65.3 172.2 14.7 8.5 0.7 0.4 7.2 31.1 8.1 0.0 23.0

5.0%, 5-yr 198.7 0.0 0.0 47.3 4.4 147.0 - - - - - - - - -

7.0%, 7-yr 0.0 0.0 0.0 - - - - - - - - - - - -

8.0%, 10-yr 94.1 97.7 1.9 9.0 15.6 25.4 44.1 7.3 2.7 1.3 86.4 1.9 0.0 1.7 0.2

8.25%, Esmeralda II - 23.4 5.8 - - - - - 8.6 11.6 3.2 5.8 0.7 2.9 2.2

Amount redeemed 650.0 46.3 0.0 0.0 0.0 612.1 37.9 0.0 26.1 0.0 20.2 0.0 0.0 0.0 0.0

2.25%, 1-yr 200.0 - - 0.0 0.0 200.0 0.0 - - - - - - - -

4.0%, 3-yr - 20.0 - - - - - - - - 20.0 - - - -

5.0%, 5-yr - 9.1 - - - - - - 9.1 - - - - - -

7.0%, 7-yr - 17.0 - - - - - - 17.0 - - - - - -

7.5%, 3-yr 450.0 - - - - 412.1 37.9 - - - - - - - -

8.0%, 10-yr - 0.2 - - - - - - - - 0.2 - - - -

Interest paid 65.3 85.1 22.3 14.0 15.9 16.2 19.2 19.3 22.9 20.6 22.3 22.3 0.0 0.0 22.3

2.25%, 1-yr 4.2 - - 2.2 0.0 2.0 - - - - - - - - -

4.0%, 3-yr 21.2 31.5 0.0 0.0 9.0 0.0 12.2 0.0 15.6 0.0 15.9 0.0 0.0 0.0 0.0

5.0%, 5-yr 16.9 24.9 12.2 7.8 0.0 9.1 0.0 12.4 0.1 12.4 0.0 12.2 0.0 0.0 12.2

7.0%, 7-yr 13.9 13.6 0.0 0.0 6.9 0.0 7.0 0.0 7.2 0.0 6.4 0.0 0.0 0.0 0.0

8.0%, 10-yr 9.1 15.1 10.1 4.0 0.0 5.1 0.0 6.9 0.0 8.2 0.0 10.1 0.0 0.0 10.1

Stock outstanding 1/ 1,674.1 1,765.6 1,804.5 1,385.2 1,470.6 1,615.3 1,674.1 1,689.9 1,675.8 1,689.0 1,765.6 1,804.5 1,774.4 1,779.1 1,804.5

2.25%, 1-yr 0.0 0.0 0.0 200.0 200.0 - - - - - - - - - - -

4.0%, 3-yr 780.0 776.8 807.8 527.7 593.0 765.3 780.0 788.5 789.2 789.6 776.8 807.8 784.8 784.8 807.8

5.0%, 5-yr 500.0 490.9 490.9 348.5 352.9 500.0 500.0 500.0 490.9 490.9 490.9 490.9 490.9 490.9 490.9

7.0%, 7-yr 200.0 183.0 183.0 200.0 200.0 200.0 200.0 200.0 183.0 183.0 183.0 183.0 183.0 183.0 183.0

8.0%, 10-yr 194.1 291.5 293.5 109.0 124.6 150.0 194.1 201.4 204.1 205.3 291.5 293.5 291.6 293.3 293.5

8.25%, Esmeralda II - 23.4 29.3 - - - - - 8.6 20.2 23.4 29.3 24.2 27.1 29.3

Held by : 1/ 0.0 -0.0 0.0 0.000 0.0 0.0 0.0 0.0 0.0 0.0 -0.0 * 0.0 0.0 0.0 0.0

Central Bank 0.0 0.0 0.0 0.0 79.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Commercial banks 1,079.4 1,095.0 1,103.0 904.3 869.9 1,079.4 1,079.4 1,087.9 1,087.9 1,090.9 1,095.0 1,103.0 1,103.0 1,103.0 1,103.0

Others 594.7 670.6 701.5 481.0 521.2 535.9 594.7 602.0 587.9 598.2 670.6 701.5 671.4 676.1 701.5


Note: With effect from July 2003 there were new issues of bonds: 2.25%,1-yr; 4%,3-yr; 5%,5-yr; 7%,7-yr; and 8%,10-yr.

- With effect from June 2005 there was the issue of a new Esmeralda II bond yielding 8.25% compounded.

- 16 -

Table 14

Government Stocks; 2004 - 2006

2004 2005 2006 2 0 0 4 2 0 0 5 2006 2 0 0 6Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Jan Feb Mar

Interest paid 12.6 12.2 6.1 6.5 0.0 6.1 0.0 6.1 0.0 6.1 0.0 6.1 3.3 0.0 2.8

Stock outstanding 1/ 150.0 150.0 150.0 150.0 150.0 150.0 150.0 150.0 150.0 150.0 150.0 150.0 150.0 150.0 150.08.50%, 2005/07 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.0 30.08.00%, 2009 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.0 50.08.00%, 2014 70.0 70.0 70.0 70.0 70.0 70.0 70.0 70.0 70.0 70.0 70.0 70.0 70.0 70.0 70.0

Held by; 1/ 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0Commercial banks 147.1 147.1 147.1 147.1 147.1 147.1 147.1 147.1 147.1 147.1 147.1 147.1 147.1 147.1 147.1Other financial institutions 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9 2.9


- 17 -

2000 2001 2002 2003 2004 2005 2006 2006Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Mar Dec Jan Feb Mar

UK Sterling 8.6446 8.4397 8.2329 8.8292 10.0747 10.0118 9.6448 10.1122 9.9302 10.0015 10.2525 10.4015 10.2182 9.8188 9.6212 9.6448 10.4911 9.6126 9.7255 9.6196 9.5965

French Franc 0.8026 0.8004 0.7746 - - - - - - - - - - - - - - - - - -

S. African Rand 0.8248 0.6925 0.5225 0.7211 0.8532 0.8661 0.8950 0.8116 0.8323 0.8643 0.9035 0.9177 0.8608 0.8445 0.8422 0.8950 0.9191 0.8649 0.9055 0.9007 0.8809

Italian Lira 0.0027 0.0027 0.0026 - - - - - - - - - - - - - - - - - -

Singapore Dollar 3.3132 3.2714 3.0633 3.1001 3.2539 3.3047 3.3804 3.2442 3.2333 3.2209 3.3176 3.3631 3.3171 3.2826 3.2572 3.3804 3.3747 3.2815 3.3703 3.3766 3.3924

Deutsche Mark 2.6917 2.6851 2.5978 - - - - - - - - - - - - - - - - - -

US Dollar 5.7132 5.8585 5.4883 5.4013 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000 5.5000

Japanese Yen 0.0530 0.0483 0.0438 0.0467 0.0509 0.0501 0.0471 0.0513 0.0502 0.0500 0.0520 0.0527 0.0512 0.0495 0.0470 0.0471 0.0524 0.0465 0.0477 0.0466 0.0469

Spanish Peseta 0.0316 0.0316 0.0305 - - - - - - - - - - - - - - - - - -

Netherlands Guilder 2.3889 2.3831 2.3056 - - - - - - - - - - - - - - - - - -

Swiss Franc 3.3797 3.4748 3.5280 4.0181 4.4286 4.4225 4.2446 4.3841 4.3054 4.3760 4.6466 4.6571 4.4929 4.3177 4.2284 4.2446 4.6902 4.2161 4.3068 4.2183 4.2135

Belgian Franc 0.1305 0.1302 0.1259 - - - - - - - - - - - - - - - - - -

Euro 5.2650 5.2516 5.1751 6.1156 6.8378 6.8483 6.6169 6.8775 6.6254 6.7208 7.1243 7.2140 6.9378 6.7066 6.5430 6.6169 7.2651 6.5271 6.6687 6.5724 6.6105

1/ Period averages.2/ From 16 March 1981 to 12 May 1996 the Seychelles rupee was fixed to the Special Drawing Rights currency basket at SDR 1 = 7.2345. 3/ Since 13 May 1996 the Seychelles rupee is pegged to the Seychelles Trade and Tourism Weighted Basket (STTWB).4/ On 1 July 2003, an appreciation limit of US$ 1 = SCR 5.50 was introduced

Table 15

2 0 0 4 2 0 0 5 2 0 0 62 0 0 5

Rupee Rates of Major Foreign Currencies; 2000-2006 1/ 2/ 3/ 4/

(Seychelles rupees per currency unit)

- 18 -

Budget Est. Budget2006 2006

2006 Q1 Q1

Total Budget Outlays 1750.7 481.5 426.5

Total Current Outlays 1513.7 408.8 395.8

Appropriation Items: 1320.4 343.0 350.1

Ministries/Departments 836.1 217.6 215.0 President's Office 28.0 16.4 12.1 Environment & Natural Resources 61.3 16.4 16.1 Tourism & Transport 29.1 6.2 7.3 Finance 34.3 8.5 8.5 Defence 77.3 24.6 19.3 Legal Affairs 6.3 1.2 1.6 Local Govt, Sports & Culture 68.4 16.4 17.1 Information Technology & Communications 14.0 3.1 3.5 Education, Youth & Manpower 181.0 44.1 45.3 Foreign Affairs 10.4 1.9 2.6 Health & Social Services 184.0 46.5 46.0 Land Use & Habitat 18.5 3.9 4.6 Administration 13.0 2.6 3.3 Police 70.0 16.8 17.5 Economic Planning & Employment 10.0 2.2 2.5 Internal Affairs 14.4 3.6 3.6 Office of the Ombudsman 0.8 0.1 0.2 Public Sector Appeals Board 0.2 0.0 0.1 Judiciary 8.5 1.3 2.1 Audit 2.7 0.4 0.7 National Assembly Secretariat 2.8 0.6 0.7 Electorial Commissioner's Office 1.1 0.5 0.4 Pensions & Gratuities 33.0 7.0 8.8 Current Outlays on regulatory bodies 65.7 14.3 17.4 Current Outlays on Parastatals 62.1 17.2 17.2 Current Outlays on other bodies 5.6 1.4 1.4 Social Security Contributions 143.4 39.4 35.8 Pension Scheme Contributions 6.5 1.4 1.6 Centralised Payments 168.0 44.8 52.9

Charges 193.3 65.7 45.7

Public Debt Interest 179.0 60.8 40.3 Salaries of Constitutional Appointees 11.8 2.5 3.0 Contribution to political parties 0.0 0.0 0.0 Execution of Elections 2.5 2.4 2.4

Capital Outlays 237.0 72.9 30.8

Compensation for Land Acquisitions 7.0 4.1 1.8 Development Grants to Parastatals 30.0 4.7 6.5 Capital Projects 200.0 64.1 22.5

Net Lending 0.0 -0.2 0.0

BTL Advances - Parastatals 0.0 1.1 0.0 - Other 0.0 -1.3 0.0 Capital Subscription to Int'l Organisation 0.0 0.0 0.0 Equity Participation 0.0 0.0 0.0

Table 16 A

SEYCHELLES GOVERNMENT BUDGET - OUTLAYS

R million

- 19 -


2006 Q1 Q1

Total Budget Receipts 1928.7 491.5 453.6

Total Current Receipts 1923.7 489.8 453.0

Trades Tax 199.5 50.7 49.9 Business Tax 304.4 59.1 66.7 Income Tax 0.0 0.0 0.0 Companies ( - ) ( - ) ( - ) Individuals ( - ) ( - ) ( - ) Transfers from SSF 125.0 31.3 31.3 Other Indirect Taxes 673.4 160.6 162.8 Fishing Licences 55.0 58.6 15.6 Other Fees and Fines 60.9 13.9 17.3 Administration fees 96.6 20.9 23.2 and charges Rents and Royalties 95.6 10.1 26.9 Income - Public Services 9.2 2.8 2.7 Dividends and Interest 160.7 72.4 29.6 Reimbursements 32.7 8.7 9.4 Miscellaneous 110.6 0.8 17.5

Grants 5.0 1.7 0.6


2006 Q1 Q1

Overall Balance 177.9 10.0 27.1

Current Outlays 1513.7 408.8 395.8Current Receipts 1923.7 489.8 453.0

Capital outlays 237.0 72.9 30.8Grants 5.0 1.7 0.6Net Lending 0.0 -0.2 0.0

SEYCHELLES GOVERNMENT BUDGET - RECEIPTS

R million

Table 16 B

SEYCHELLES GOVERNMENT BUDGET - BALANCETable 16 C

R million

- 20 -

Table 17

TOURISM (1) No. of Average Visitor Hotel bed Income from Average visitor length nights occupancy tourism (2) Expenditure arrivals of stay ('000) Rate (%) (R million) per diem

(nights) per visitor (rupees)

1979 78,852 9.1 718 64 295.3 4121980 71,762 9.0 646 56 330.9 5121981 60,425 9.6 580 48 289.1 4981982 47,280 9.7 459 37 222.6 4851983 55,867 10.7 598 48 233.0 3901984 63,417 10.8 685 55 282.6 4131985 72,542 11.0 798 62 335.7 4211986 66,782 11.7 781 64 346.8 4441987 71,626 11.4 817 66 379.6 4651988 77,401 11.0 851 63 439.6 5161989 86,093 10.7 921 61 521.8 5661990 103,770 10.1 1,048 67 645.5 6161991 90,050 10.5 946 56 525.8 5561992 98,547 10.2 1,005 55 599.5 5961993 116,180 9.6 1,115 58 607.4 5451994 109,901 10.1 1,110 54 510.0 4591995 120,716 9.5 1,146 53 466.3 4071996 130,955 9.7 1,270 57 524.5 4131997 130,070 10.3 1,340 56 612.5 4571998 128,258 10.5 1,347 53 583.8 4341999 124,865 10.4 1,296 53 596.2 4602000 130,046 10.4 1,349 52 600.0 4452001 129,762 10.4 1,351 52 648.8 4802002 132,246 10.1 1,331 52 706.4 5312003 122,038 10.2 1,239 46 681.3 5502004 120,765 10.0 1,213 44 756.4 6242005 128,654 9.7 1,247 46 605.0 485

2004Q1 31,439 9.9 311 45 210.3 676Q2 27,186 9.9 268 41 186.1 694Q3 29,017 10.7 310 45 183.6 591Q4 33,123 9.7 321 45 176.3 549

2005Q1 33,024 9.3 308 48 168.5 547Q2 26,168 9.7 255 40 144.6 568Q3 32,327 10.4 337 48 139.2 413Q4 37,135 9.3 344 47 152.7 444

2006Q1 35,685 9.4 337 50 180.3 536

2004Apr 10,515 9.6 101 45 67.8 671May 9,188 10.0 92 40 60.7 661Jun. 7,483 10.0 75 39 57.6 770Jul. 9,975 10.4 104 44 74.8 721Aug. 10,919 11.0 120 50 53.4 444Sep. 8,123 10.7 87 40 55.5 638Oct. 11,344 10.0 113 49 56.9 502Nov. 9,839 9.8 96 46 62.7 651Dec. 11,940 9.3 111 39 56.7 510

2005Jan. 10,144 9.3 94 47 50.4 535Feb. 10,213 9.5 97 44 49.0 505Mar. 12,667 9.2 117 52 69.0 592Apr 10,615 9.9 105 43 59.9 570May 7,658 9.8 75 39 49.0 653Jun. 7,895 9.5 75 37 35.7 476

Jul. 10,502 10.2 107 44 40.5 378Aug. 12,444 10.6 132 55 52.2 396Sep. 9,381 10.5 99 45 46.5 472Oct. 12,446 9.8 122 49 49.8 408.2Nov. 12,240 8.8 108 50 57.4 532.8Dec. 12,449 9.2 115 41 45.6 397.7

2006Jan. 11,920 9.6 114 48 47.9 418.8Feb. 12,528 9.1 114 51 46.8 410.8Mar. 11,237 9.6 108 .. 85.5 793.0

Source : Management and Information Systems Division and CBS exchange record.(1) Figures may not necessarily correspond to MISD figures due to rounding.(2) These are purchases of foreign exchange by banks from tourists and hotels.

- 21 -

Table 18

VISITOR ARRIVALS BY COUNTRY OF RESIDENCE

2001 2002 2003 2004 2005 2006 2 0 0 5 2006 2000 2001 2002 2003 2004 2005 2006 2 0 0 5 2006Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1

Europe 102.9 105.6 99.7 98.4 103.4 106.2 27.2 20.6 26.0 29.5 30.0 80.1 79.3 79.9 81.7 81.5 80.4 80.9 82.4 78.8 80.6 79.4 84.1

France 25.5 28.3 26.0 26.0 27.6 28.7 7.4 5.9 5.6 8.6 8.6 21.7 19.6 21.4 21.3 21.6 21.4 21.9 22.5 22.7 17.5 23.0 24.0 U.K. 17.5 19.3 19.1 18.0 16.8 16.1 4.0 3.6 4.7 4.5 3.3 12.7 13.5 14.6 15.7 14.9 13.1 12.2 12.2 13.7 14.5 12.1 9.3 Italy 21.2 20.0 17.8 17.1 18.4 19.4 4.3 3.7 6.3 4.0 5.3 15.3 16.3 15.1 14.6 14.2 14.3 14.8 13.1 14.1 19.6 10.8 15.0 Germany 16.8 15.1 15.9 15.5 17.0 17.4 4.9 3.2 3.6 5.4 5.3 13.6 13.0 11.5 13.0 12.8 13.2 13.2 14.8 12.1 11.1 14.5 14.8 Switzerland 5.2 5.2 4.7 4.5 4.3 4.2 1.1 0.8 0.9 1.5 1.0 3.8 4.0 3.9 3.9 3.7 3.3 3.2 3.4 3.0 2.7 4.1 2.7 Scandinavia 3.5 3.6 3.1 2.8 2.3 2.4 0.8 0.3 0.3 0.8 0.9 3.3 2.7 2.8 2.5 2.3 1.8 1.8 2.5 1.2 1.1 2.2 2.5 Others 13.2 14.0 13.1 14.5 17.0 18.0 4.6 3.1 4.6 4.7 5.6 9.5 10.2 10.6 10.7 12.0 13.2 13.7 13.9 12.0 14.2 12.6 15.8

Africa 13.9 10.1 13.6 12.7 12.6 12.4 2.9 2.7 3.1 3.9 2.8 10.6 10.7 10.5 11.2 10.5 9.8 9.5 8.8 10.4 9.4 10.4 7.9

East Africa 1.3 1.5 1.2 1.2 1.0 1.1 0.2 0.2 0.3 0.3 0.3 1.3 1.0 1.1 1.0 1.0 0.8 0.8 0.7 0.8 0.8 0.9 0.8 South Africa 4.4 4.2 5.0 5.1 5.4 5.2 1.3 1.1 1.3 1.7 1.1 3.3 3.4 3.2 4.1 4.2 4.2 4.0 3.8 4.1 4.1 4.7 3.0 Others 8.2 8.2 7.4 6.3 6.1 6.1 1.4 1.4 1.5 1.8 1.4 6.1 6.3 6.2 6.1 5.2 4.8 4.7 4.3 5.5 4.5 4.8 4.0

Asia 5.5 7.2 4.8 5.0 7.9 8.0 1.8 1.8 2.2 2.2 1.9 4.1 4.2 6.5 3.9 4.1 6.2 6.1 5.5 6.9 6.7 5.8 5.2

Japan 0.4 0.4 0.3 0.3 0.4 0.4 0.0 0.1 0.2 0.1 0.1 0.3 0.3 0.3 0.3 0.2 0.3 0.3 0.1 0.3 0.5 0.2 0.2 Other Far East 1.7 1.9 1.2 1.3 1.6 1.6 0.4 0.3 0.4 0.5 0.4 1.4 1.3 1.4 1.0 1.1 1.2 1.2 1.1 1.3 1.1 1.3 1.1 Middle East 1.8 4.6 2.1 2.0 4.5 4.5 1.0 1.0 1.3 1.2 1.1 1.4 1.4 3.5 1.7 1.6 3.5 3.4 3.1 3.7 4.0 3.1 3.0 India, Pakistan and Sri Lanka 1.7 1.8 1.2 1.4 1.5 1.5 0.3 0.4 0.4 0.4 0.4 1.0 1.3 1.3 1.0 1.2 1.2 1.2 1.1 1.6 1.1 1.1 1.0

America 6.9 3.7 3.5 4.0 3.9 3.8 0.9 0.8 0.8 1.3 0.8 4.8 5.3 2.8 2.8 3.3 3.0 2.9 2.7 3.1 2.6 3.6 2.4

Oceania 0.6 0.5 0.5 0.7 0.9 0.9 0.2 0.2 0.2 0.3 0.2 0.4 0.4 0.3 0.4 0.6 0.7 0.7 0.6 0.8 0.7 0.8 0.5

Total 129.8 132.2 122.0 120.8 128.7 131.3 33.0 26.2 32.3 37.1 35.7 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Source : Management and Information Systems Division.

- 22 -

2000 2001 2002 2003 2004 2005

Prov

(R Million)CURRENT ACCOUNT -245.3 -896.6 -555.0 -49.3 -330.0 -1075.0

Goods -667.5 -1242.9 -785.6 -481.4 -853.5 -1646.2Credits (of which:) 1112.9 1267.9 1297.1 1546.9 1656.0 1930.0 Merchandise exports (f.o.b) 740.8 954.7 992.2 1180.3 1097.3 1165.1Debits (of which:) 1780.4 2510.8 2082.7 2028.3 2509.5 3576.2 Merchandise imports (f.o.b) 1701.4 2438.3 2017.6 1957.3 2374.7 3434.6

Services 552.5 460.4 528.9 595.0 609.2 619.9Credits (of which:) 1639.5 1723.0 1716.8 1784.4 1796.3 2028.2 Tourism Earnings 788.8 848.7 893.9 918.1 938.3 1050.5Debits 1087.0 1262.6 1188.0 1189.4 1187.1 1408.3

Income -190.2 -171.2 -372.6 -233.3 -185.3 -220.4Compensation of employees -13.5 -12.1 -17.5 -25.5 -28.3 -31.8 Credit 1.0 1.0 1.1 0.9 0.9 1.0 Debit 14.5 13.1 18.6 26.4 29.2 32.8Investment income -176.7 -159.1 -355.1 -207.8 -157.0 -188.6 Credits 56.8 47.3 39.7 63.9 51.0 52.9 Debits 233.5 206.4 394.7 271.6 208.0 241.5

Current transfers 60.0 57.3 74.4 70.3 99.5 171.7General government 86.1 67.5 72.8 56.9 75.6 128.2 Credits 86.6 69.6 73.8 59.0 77.1 129.9 Fishing license fees 24.8 38.4 35.0 42.6 58.4 52.4 Overseas grants 49.6 14.0 25.2 10.7 3.5 17.8 Educational grants 6.7 9.5 6.8 0.8 6.7 9.9 Other grants 5.6 7.7 6.8 4.8 8.5 49.8 Debits 0.5 2.1 1.0 2.1 1.5 1.7Other sectors -26.1 -10.2 1.6 13.5 23.9 43.6 Credits 17.1 9.5 9.8 26.6 38.4 65.5 Debits 43.2 19.7 8.2 13.1 14.4 22.0

CAPITAL AND FINANCING ACCOUNT 437.3 603.6 743.3 -126.9 -162.1 977.7

CAPITAL ACCOUNT 5.1 55.3 27.5 40.1 5.4 164.3

FINANCIAL ACCOUNT 432.2 548.3 715.7 -166.9 -167.6 813.4Direct investment 79.0 329.2 213.6 271.5 167.3 431.4Abroad 60.00 50.01 47.85 44.00 41.80 40.96In Seychelles (of which:) 139.0 379.2 261.5 315.5 209.1 472.3 Sale of Assets (Privatised enterprises) 0.0 0.0 0.0 85.0 0.0 1.9 Equity capital 114.0 331.7 205.8 181.7 176.0 410.5 Re-invested earnings 25.0 47.5 55.7 48.8 33.1 59.9

Portfolio investment 5.4 6.0 5.7 6.1 5.9 5.6Assets -0.5 -0.4 -0.4 -0.1 -0.2 -0.2Liabilities 6.0 6.4 6.1 6.2 6.1 5.8

Other investments 347.8 213.1 496.4 -444.6 -340.8 376.4Assets 84.8 51.3 58.4 80.0 67.4 52.9Liabilities 432.6 264.5 554.8 -364.6 -273.4 429.3

Net errors and omissions 19.7 6.6 -55.3 -26.4 2.0 13.2

OVERALL BALANCE 211.8 -286.3 133.0 -202.7 -490.2 -84.1

Financing of overall balance -211.8 286.3 -133.0 202.7 490.2 84.1Reserve assets -110.88 60.50 -141.68 -16.89 181.34 -120.85Arrears -100.88 225.85 8.64 219.54 308.82 204.93

Memorandum items:Current account (percentage of GDP) -7.0 -24.7 -14.5 -1.3 -8.5 -27.8Trade Balance (f.o.b.). (merchandise exports less imports) -960.6 -1483.7 -1025.4 -776.9 -1277.4 -2269.5Stock of Reserves (Gross) (R million) 271.1 210.6 352.3 369.2 187.8 308.7Stock of Reserves (Gross) (Weeks of cif imports) 7.2 3.9 8.0 8.6 3.5 4.2

1/ Data series differ from previous publications due to revisions

Table 19Balance of Payments; 2000-2005 1/

Table 20Trade in Goods; 2000-2005

2000 2001 2002 2003 2004 2005

(R Million) Prov

GOODS, NET -667.49 -1242.93 -785.59 -481.40 -853.46 -1646.19

General merchandise -960.58 -1483.66 -1025.37 -776.93 -1277.36 -2269.54

Exports f.o.b 740.82 954.68 992.22 1180.34 1097.32 1165.05 Copra 0.00 0.27 0.03 0.00 0.00 0.00 Cinnamon bark 1.33 1.32 1.22 0.98 0.53 0.48 Frozen and fresh fish 20.68 17.33 18.18 27.99 13.13 16.45 Canned tuna 606.21 771.18 843.67 1023.14 923.25 969.62 Shark fins (dried) 0.00 0.00 0.00 0.00 0.00 0.00 Frozen prawns 18.30 12.11 8.73 41.20 42.72 31.47 Other processed fish 0.00 1.13 8.73 41.20 42.72 31.85 Crustaceans 24.65 50.39 47.26 27.11 8.33 10.23 Other exports 69.65 100.96 67.61 59.91 109.36 136.42 Sale of domestic fleet aircraft (air craft) 0.00 0.00 5.52 0.00 0.00 0.00

Imports f.o.b 1701.40 2438.35 2017.59 1957.26 2374.68 3434.59 Food, live animals & vegetable oils 440.12 548.79 572.71 568.79 629.22 687.47 Beverages and tobacco 23.02 18.62 30.99 27.47 30.13 38.99 Mineral fuels 359.30 348.14 278.69 304.56 610.78 741.57 Chemicals 109.44 123.17 129.17 175.94 168.73 202.63 Manufactured goods & misc. manufactured arti 401.96 390.31 442.35 453.55 476.49 561.83 Machinery and transport equipment * 293.12 898.01 461.12 334.97 374.01 959.76 Other commodities 40.17 32.56 35.65 30.77 32.66 167.74 Other unrecorded shipment (shuttle trade) 34.28 78.74 66.90 61.21 52.68 74.60

Goods procured in ports by carriers 304.44 246.77 242.65 298.45 446.61 650.05Credits 368.25 309.08 300.67 362.19 554.68 760.51 Petroleum products 356.77 296.57 290.88 352.73 531.02 736.22 Food and beverages 8.54 7.07 7.41 7.81 8.46 9.45 Others 2.94 5.44 2.38 1.65 15.19 14.84

Debits 63.80 62.31 58.02 63.74 108.07 110.45 Petroleum products 54.33 53.01 47.11 50.70 94.38 96.68 Food and beverages 9.47 9.30 10.91 13.04 13.69 13.78

Repairs on goods -11.35 -6.04 -2.87 -2.92 -22.70 -26.70In Seychelles 3.89 4.12 4.24 4.37 4.05 4.42 Repair of foreign aircrafts 3.10 3.33 3.51 3.60 3.41 3.75 Repair of foreign ships 0.79 0.78 0.73 0.77 0.65 0.67

Abroad 15.24 10.15 7.11 7.30 26.76 31.12 Repair of Air Seychelles aircrafts 14.68 8.78 4.22 4.33 23.64 27.62 Repair of Seychelles ships 0.56 1.38 2.89 2.97 3.11 3.50

* Include the value of the Boeing 767-300 acquired by Air Seychelles in April 2001 under a financial lease agreement.

* In year 2000, this included R10.6 million, representing a Coetivy aircraft

* In year 2005, this inlcuded import of two tankers; MT Seychelles Pioneer and MT Seychelles Progress

Table 21Trade in services; 2000-2005

2000 2001 2002 2003 2004 2005

(R million) Prov

SERVICES, NET 552.5 460.4 528.9 595.0 609.2 619.9

Transportation 300.0 231.8 178.7 222.5 133.3 140.9

Passenger 378.5 332.9 344.7 373.7 360.1 313.8 Credits 491.6 437.2 455.0 472.4 463.4 425.0 Ticket sales to non-residents by Air Seychelles 469.4 417.0 451.0 472.4 463.4 425.0 Others 10/ 22.2 20.2 4.1 0.0 0.0 0.0 Debits (tickets to foreign airlines by residents) 113.2 104.3 110.3 98.7 103.3 111.2

Freight -156.0 -170.6 -257.9 -244.0 -305.3 -266.6 Credits 87.6 112.9 28.9 34.8 36.2 138.4 Debits 11/ 243.6 283.5 286.9 278.8 341.5 405.0

Other transportation services 77.6 69.6 91.9 92.8 78.5 93.8 Credits 128.3 124.5 148.1 166.5 150.6 170.7 Marine and port charges 28.3 27.0 30.8 35.6 34.6 39.3 Income from stevedoring 49.2 44.9 61.8 68.4 58.8 65.5 Agency service income 16.0 15.0 10.6 21.5 19.5 23.0 Ground handling fees 15.7 14.2 15.5 15.9 15.2 16.1 Aircraft landing fees 14.2 13.1 14.6 15.1 12.2 15.0 Others 4.9 10.2 14.7 10.0 10.4 11.8 Debits 50.7 54.9 56.3 73.7 72.1 76.9

Travel 658.9 723.3 720.7 728.2 760.0 843.8

Credits 795.6 856.2 900.5 924.2 944.4 1056.5 Tourism earnings 12/ 788.8 848.7 893.9 918.1 938.3 1050.5 Others 6.7 7.4 6.6 6.1 6.0 6.0

Debits 136.7 132.8 179.8 196.0 184.4 212.7 Foreign travel expenditure 100.0 92.9 131.2 129.2 109.0 120.9 Training of residents abroad 24.7 30.9 30.4 24.5 38.4 42.9 Others 12.0 9.0 18.3 42.3 36.9 49.0

Insurance, net -67.8 -81.1 -79.8 -80.1 -90.2 -91.6

Royalty payments -2.5 -2.5 -3.0 -3.0 -3.0 -3.0

Financial and Business services -190.4 -261.3 -194.4 -244.4 -181.2 -183.2 Credits (of which) 52.0 92.7 79.3 72.4 93.8 97.8 Telecomunications 49.9 54.8 56.0 56.2 66.8 69.4 Debits 242.4 354.0 273.6 316.8 274.9 281.0

Construction services -196.7 -208.3 -143.2 -92.2 -83.6 -188.2

Government services 51.1 58.4 49.9 64.1 73.9 101.1 Credits 77.7 82.0 90.1 105.7 100.1 120.0 USAF Tracking Station 0.0 0.0 0.0 0.0 0.0 0.0 Foreign embassies in Seychelles 3.0 3.0 3.0 3.0 2.7 2.7 Licences and other fees 74.7 79.0 87.2 102.7 97.4 117.3 Debits 26.7 23.5 40.2 41.6 26.2 18.9 Expenses by Seychelles embassies 6.8 6.5 6.7 6.1 3.3 3.4 Tourism promotion 19.8 17.1 13.6 15.2 12.7 11.0 Government Others - - 19.9 20.3 10.2 4.6

NOTES TO BALANCE OF PAYMENTS General Table 21 is a presentation of Seychelles Balance of Payments (BOP) classified according to the fifth edition of the IMF BOP manual. Tables 22 and 23 provide further details on two components of the current account: goods and services. Source of information The following sources are used in the compilation of the BOP; -Central Bank; -Commercial banks; -National Statistics Bureau; -Enterprise surveys; and -Department of Finance. Notes pertaining to Tables 21 and 23 4/ Includes labour and non-financial property income, which are treated separately for the first time in the fifth edition of the manual. 5/ Comprises wages, (including social security contributions), and other benefits, in cash or in kind, earned by residents form non-resident entities and vice versa (e.g., wages of Seychelles residents at US Air Force Tracking Station and payments to non-Seychellois staff of Seychelles embassies). 6/ Includes re-invested earnings, dividends and distributed profits. 7/ In the fifth edition of the BOP manual the “capital and financial” account replaces the old “capital” account. 8/ Includes commercial banks’ investments in foreign bills and securities. 9/ Covers government and commercial bank loans, currency, deposits and other transfers of capital. 10/ External assets that are readily available to and controlled by monetary authorities for direct financing of payments imbalances. Includes Special Drawing rights (SDRs), reserve position with the IMF, balances with the treasury and other public sector agencies. 11/ Includes receipts form excess baggage, unaccompanied baggage, coupon uplifted by non-residents to Air Seychelles. 12/ Freight costs are estimated at 15 per cent of imports c.i.f. 13/ Based on tourism expenditure surveys conducted by the National Statistics Bureau.

- 26 -

Total

AustraliaBahrainBelgiumChinaDenmarkFinlandFranceGermany Hong KongIndiaIndonesiaIrelandItalyJapanKenyaMadagascarMalaysiaMauritiusNetherlandsNew ZealandReunionSaudi ArabiaSingaporeSouth AfricaSpainSwedenSwitzerlandTaiwanThailandUnited Arab EmiratesUnited KingdomUnited StatesYemen (DPR)Others

Source : Nationa

Table 22IMPORTS BY COUNTRY OF ORIGIN -2000-2005

2000 2001 2002 2003 2004 2005 2 0 0 4 2 0 0 5 2000 2001 2002 2003 2004 2005 2 0 0 4 2 0 0 5Q3 Q4 Q1 Q2 Q3 Q4 Q3 Q4 Q1 Q2 Q3 Q4

R million Per cent

1951.0 2776.0 2294.9 2230.6 2739.0 3716.2 691.4 777.3 662.1 989.2 1103.8 960.9 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

23.4 25.9 32.9 - 26.3 24.1 5.4 7.9 4.7 6.4 6.0 7.0 1.2 0.9 1.1 1.3 1.0 0.6 0.8 1.0 0.7 0.7 0.5 0.7.. 44.6 0.3 0.5 0.6 0.5 .. 0.5 0.0 0.3 0.1 0.2 .. .. .. .. .. .. .. 0.1 .. .. .. ..18.8 24.4 23.3 22.5 22.6 43.7 4.3 6.1 8.0 5.6 2.5 27.6 1.0 0.9 0.8 1.2 0.8 1.2 0.6 0.8 1.2 0.6 0.2 2.921.5 18.7 15.9 17.0 22.1 37.9 5.0 9.1 3.8 8.5 15.1 10.5 1.1 0.7 0.7 1.4 0.8 1.0 0.7 1.2 0.6 0.9 1.4 1.111.0 11.0 17.6 24.2 17.1 17.9 6.6 3.2 7.3 3.5 3.3 3.8 0.6 0.4 0.5 0.5 0.6 0.5 1.0 0.4 1.1 0.4 0.3 0.4

1.8 8.5 9.4 3.1 3.5 3.7 0.4 0.8 0.0 1.1 2.4 0.2 0.1 0.3 0.1 0.0 0.1 0.1 0.1 0.1 .. 0.1 0.2 ..182.6 271.3 270.7 232.8 270.4 242.0 74.8 75.6 62.4 59.6 57.1 62.9 9.4 9.8 7.2 13.6 9.9 6.5 10.8 9.7 9.4 6.0 5.2 6.5

31.5 31.8 185.1 21.5 21.3 529.1 4.7 3.5 2.4 249.9 263.5 13.3 1.6 1.1 3.0 1.3 0.8 14.2 0.7 0.5 0.4 25.3 23.9 1.49.5 8.4 8.0 9.9 15.2 6.8 2.7 3.9 2.7 2.3 0.8 1.0 0.5 0.3 0.9 0.2 0.6 0.2 0.4 0.5 0.4 0.2 0.1 0.1

69.2 38.0 45.3 49.4 71.3 76.0 14.4 21.9 18.1 18.3 17.7 21.9 3.5 1.4 3.1 3.5 2.6 2.0 2.1 2.8 2.7 1.8 1.6 2.39.2 12.7 8.8 19.5 12.7 28.2 2.4 4.5 3.5 5.8 7.9 10.9 0.5 0.5 0.9 0.4 0.5 0.8 0.3 0.6 0.5 0.6 0.7 1.1

14.0 7.3 6.4 6.3 7.5 14.5 1.9 3.8 2.7 4.9 4.7 2.2 0.7 0.3 0.6 0.7 0.3 0.4 0.3 0.5 0.4 0.5 0.4 0.2169.3 177.3 192.1 237.0 208.7 231.7 38.8 53.5 49.9 63.2 66.0 52.7 8.7 6.4 8.5 10.5 7.6 6.2 5.6 6.9 7.5 6.4 6.0 5.5

20.6 57.9 23.0 30.0 28.7 31.4 6.8 9.3 5.5 6.7 6.5 12.8 1.1 2.1 0.6 1.2 1.0 0.8 1.0 1.2 0.8 0.7 0.6 1.325.6 22.0 26.8 25.7 25.1 25.7 5.8 6.8 5.9 6.2 7.2 6.4 1.3 0.8 0.7 1.0 0.9 0.7 0.8 0.9 0.9 0.6 0.7 0.7

4.1 1.9 6.8 0.7 0.7 0.6 0.1 .. 0.0 0.1 0.1 0.4 0.2 0.1 0.3 0.4 .. .. .. .. .. .. .. ..41.7 28.1 42.7 21.8 34.4 65.7 6.9 11.7 9.2 20.1 10.6 25.9 2.1 1.0 2.1 3.4 1.3 1.8 1.0 1.5 1.4 2.0 1.0 2.743.9 49.1 99.0 59.2 110.9 99.5 19.9 16.2 18.9 27.7 22.9 29.9 2.2 1.8 2.2 2.3 4.0 2.7 2.9 2.1 2.9 2.8 2.1 3.125.5 19.3 22.8 31.3 40.2 29.0 3.5 14.4 7.5 5.5 4.9 11.1 1.3 0.7 1.9 0.9 1.5 0.8 0.5 1.9 1.1 0.6 0.4 1.2

5.3 12.1 7.0 10.9 9.0 7.8 1.2 2.4 1.1 1.8 2.9 1.9 0.3 0.4 0.3 0.3 0.3 0.2 0.2 0.3 0.2 0.2 0.3 0.23.8 5.7 5.5 3.5 1.1 2.6 0.3 0.4 0.8 0.6 0.8 0.4 0.2 0.2 0.1 0.2 .. 0.1 0.1 0.1 0.1 0.1 0.1 ..

407.9 237.9 320.5 350.2 709.0 853.8 175.5 223.5 156.4 172.3 270.2 254.8 20.9 8.6 25.4 12.5 25.9 23.0 25.4 28.8 23.6 17.4 24.5 26.5154.2 162.2 170.2 177.0 196.4 283.8 44.3 60.0 51.3 74.3 66.5 91.8 7.9 5.8 6.4 8.8 7.2 7.6 6.4 7.7 7.7 7.5 6.0 9.6216.5 189.2 247.5 282.0 250.3 229.0 93.5 59.4 44.2 67.8 50.0 67.0 11.1 6.8 9.2 12.0 9.1 6.2 13.5 7.6 6.7 6.8 4.5 7.0140.5 183.2 198.0 233.1 249.8 288.6 86.5 68.0 83.0 63.0 67.5 75.2 7.2 6.6 8.3 6.4 9.1 7.8 12.5 8.7 12.5 6.4 6.1 7.8

3.6 1.1 2.7 1.2 2.2 2.6 1.2 0.3 0.2 0.8 0.5 1.1 0.2 .. 0.3 0.3 0.1 0.1 0.2 .. .. 0.1 .. 0.19.3 15.4 21.3 17.9 21.1 10.3 4.9 3.2 3.0 0.9 2.5 3.9 0.5 0.6 0.3 0.4 0.8 0.3 0.7 0.4 0.4 0.1 0.2 0.44.1 4.5 15.9 10.0 6.8 12.4 0.4 0.6 5.5 3.0 1.5 2.3 0.2 0.2 0.1 0.2 0.2 0.3 0.1 0.1 0.8 0.3 0.1 0.2

22.2 32.5 25.2 30.9 23.2 28.2 5.3 6.6 7.0 7.2 4.8 9.2 1.1 1.2 1.5 0.7 0.8 0.8 0.8 0.8 1.1 0.7 0.4 1.0

33.1 125.8 35.9 43.4 57.3 140.1 12.5 18.0 37.2 24.6 42.8 35.4 1.7 4.5 1.4 2.1 2.1 3.8 1.8 2.3 5.6 2.5 3.9 3.7169.2 168.8 150.7 172.7 171.4 188.5 43.8 43.5 37.0 46.7 50.2 54.6 8.7 6.1 7.8 9.7 6.3 5.1 6.3 5.6 5.6 4.7 4.5 5.7

34.2 723.1 31.5 25.4 45.9 69.7 6.1 25.3 10.5 9.8 22.9 26.5 1.8 26.0 2.4 1.4 1.7 1.9 0.9 3.3 1.6 1.0 2.1 2.8.. .. .. - .. .. - .. .. .. .. .. - - - - .. - - .. - - - -24.0 56.2 26.2 60.2 56.1 90.8 11.4 13.2 12.5 20.8 21.4 36.0 1.2 2.0 1.2 1.2 2.0 0.3 1.6 1.7 1.9 2.1 1.9 3.7

al Statistics Bureau.- 27 -

Table 23

Domestic exports by main country of destination - 2000 - 2005

2000 2001 2002 2003 2004 2005 2 0 0 4 2 0 0 5 2000 2001 2002 2003 2004 2 0 0 4 2 0 0 5

Q3 Q4 Q1 Q2 Q3 Q4 Q3 Q4 Q1 Q2 Q3 Q4

R million Per cent

Total 706.3 892.4 957.5 1141.7 1009.0 1164.8 220.4 230.5 294.9 301.2 274.5 294.2 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Australia 0.2 2.3 2.5 0.3 1.3 3.8 0.9 0.8 0.5 - 0.6 0.2 .. 0.3 0.3 .. 0.1 0.4 0.4 0.2 - 0.2 0.1

Belgium 2.4 3.5 0.1 - .. .. .. .. - - - .. 0.3 1.2 0.5 - .. .. .. - - - ..

Canada 0.1 0.1 0.1 0.1 0.2 0.1 0.1 0.1 - 0.1 - - - - - .. .. .. .. - .. - -

France 153.6 224.3 286.1 365.3 310.4 268.8 66.3 33.0 80.5 87.4 50.7 50.2 6.3 10.5 13.8 32.0 30.8 30.1 14.3 27.3 29.0 18.5 17.1

Germany 86.2 55.5 81.2 86.1 82.9 118.6 3.4 20.0 53.0 1.3 6.0 58.3 0.3 20.5 23.8 7.5 8.2 1.5 8.7 18.0 0.4 2.2 19.8

Hong Kong 1.9 2.1 0.7 1.5 0.5 2.3 .. 0.2 0.3 0.8 0.7 0.6 0.1 0.1 0.4 0.1 .. .. 0.1 0.1 0.3 0.3 0.2

Italy 66.4 134.9 91.6 159.6 97.9 144.3 22.8 28.6 32.8 42.0 39.2 30.3 22.2 20.0 14.9 14.0 9.7 10.4 12.4 11.1 13.9 14.3 10.3

Japan 7.2 2.5 10.3 6.0 4.9 7.1 1.9 0.3 0.8 5.5 0.3 0.5 0.3 1.6 0.9 0.5 0.5 0.9 0.1 0.3 1.8 0.1 0.2

Mauritius 1.4 0.5 0.6 1.1 1.6 1.9 0.1 0.7 0.1 0.5 0.3 0.9 0.3 0.2 0.6 0.1 0.2 .. 0.3 .. 0.2 0.1 0.3

Netherlands 8.3 18.8 21.1 13.0 16.1 33.6 7.2 1.9 8.9 6.7 7.8 10.1 10.4 1.1 1.6 1.1 1.6 3.3 0.8 3.0 2.2 2.9 3.4

Reunion 3.2 3.0 2.5 2.0 3.8 2.6 0.9 0.7 0.4 0.9 0.7 0.6 0.2 0.4 0.7 0.2 0.4 0.4 0.3 0.1 0.3 0.2 0.2

Singapore 1.2 0.3 0.3 5.0 2.0 1.5 0.5 0.7 0.1 0.3 0.3 0.9 .. 0.2 0.3 0.4 0.2 0.2 0.3 .. 0.1 0.1 0.3

South Africa 16.3 11.2 2.3 3.2 3.9 7.8 3.4 - 1.4 6.4 - .. 0.1 0.7 4.2 0.3 0.4 1.5 - 0.5 2.1 - ..

UK 316.5 334.5 404.3 447.9 454.9 528.9 108.6 135.4 108.0 136.4 156.2 128.3 56.9 39.6 31.6 39.2 45.1 49.3 58.8 36.6 45.3 56.9 43.6

USA 0.4 .. .. 9.8 .. 4.6 - .. 0.2 3.5 0.5 0.5 0.2 .. 0.3 0.9 .. - .. 0.1 1.2 0.2 0.2

Others 41.1 98.7 53.8 41.0 27.9 41.4 4.4 8.0 7.9 9.5 11.1 13.0 2.7 3.6 6.4 3.5 2.6 1.9 3.3 2.7 3.2 4.0 4.4

Source: National Statistics Bureau.

- 28 -

Table 24

GROSS DOMESTIC PRODUCT (1)Current Prices

R million

2000 2001 2002 2003 2004 2005

GDP by Industrial Origin

Agriculture, Forestry and Fishing 99.4 103.0 110.3 100.5 100.7 104.8

Mining, Manufacturing and Handicrafts 674.9 654.8 698.0 623.2 541.4 586.0

Electricity and Water 47.8 61.5 74.7 91.2 97.3 100.6

Building and Construction 296.8 307.4 384.2 342.5 379.8 466.1

Transport, Distribution and Communications (4) 1,032.9 1,069.8 1,110.6 1,111.9 1,182.0 1,221.0

Hotels and Restaurants 324.2 383.7 379.8 350.5 397.8 419.2

Finance and Business Services 362.4 364.4 372.4 389.7 431.6 434.6

Government Services 433.0 443.0 458.0 488.8 489.0 490.0

Other Services 241.9 257.2 240.6 313.0 229.4 152.1

Gross Domestic Product at

Current Market Prices (5) 3,513.3 3,644.8 3,828.6 3,811.3 3,849.0 3,974.4

Plus Net factor income from

abroad -190.2 -172.2 -372.6 -233.3 -185.3 -220.4

Gross National Product at

Market Prices 3,323.1 3,472.6 3,456.0 3,578.0 3,663.7 3,754.0

Less Net indirect taxes 622.2 637.3 687.7 895.8 n.a n.a

Less Depreciation 259.1 267.1 282.3 280.0 n.a n.a

Net National Product at

Factor Cost (National Income) 2,441.8 2,568.2 2,486.0 2,402.2 n.a n.a

Source : National Statistics Bureau.

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Table 25

PRODUCTION INDICATORS

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2 0 0 5 2 0 0 6

Q1 Q2 Q3 Q4 Q1

Crop production

Copra (Exports) (tonnes) 112 353 0 0 0 0 52 72 11 0 0 0 0 0 0 Copra (Deliveries to warehouse) (tonnes) 282 344 393 314 259 301 377 421 262 296 41 41 20 56 95 Cinnamon bark (Exports) (tonnes) 414 487 318 220 289 214 177 147 158 112 0 24 16 32 31 Cinnamon bark (Deliveries to warehouse) (tonnes) 469 414 280 241 478 385 25 187 116 148 4 3 2 0 8 Tea (Green leaf) (tonnes) 246 226 223 270 250 236 246 231 222 261 63 52 43 61 51

Livestock slaughters (1) Cattle (no.) 329 189 162 91 123 139 147 129 83 85 16 28 18 25 14 Pigs (no.) 8,516 6,739 5,302 5,165 6,430 6,629 8,619 8,648 8,808 8,027 2,372 2,428 2,194 2,139 1,918 Chickens (no.) 529,782 733,221 720,099 806,397 683,744 694,839 734,454 700,380 675,155 766,196 187,817 176,401 192,984 194,158 221,734

Fish

Production of Canned Tuna (2) (tonnes) 5,075 7,495 12,708 15,133 18,939 33,234 28,781 27,789 34,503 36,436 10,960 8,370 10,276 11,000 9,145 Other processed Tuna (tonnes) n.a. n.a. n.a. n.a. n.a. n.a. n.a. 3,735 3,078 2,288 36 298 0 0 0 Total catch of fish (3) (tonnes) 4,428 4,313 4,508 4,095 3,334 4,843 4,768 4,442 4,896 3,852 1,053 987 962 1,204 1,079 Production of Prawns (tonnes) 164 196 224 584 642 227 425 282 234 1,084 150 557 19 46 107 Exports of Prawns (tonnes) n.a. n.a. n.a. 310 581 159 211 236 182 876 150 557 19 46 94

Beverages and tobacco production

Soft drinks (4) ('000 litres) 8,038 8,463 7,852 8,286 10,251 10,561 8,806 8,700 9,421 8,094 1,650 1,886 2,017 1,718 2,314 Beer and stout ('000 litres) 5,838 5,852 6,365 7,113 7,181 6,768 7,046 7,241 7,605 6,519 1,370 1,586 1,397 1,910 1,535 Mineral water ('000 litres) 825 778 837 996 1,350 1,464 3,431 2,832 4,732 4,693 659 1,348 1,381 991 1,502 Cigarettes (million) 49 56 62 70 61 60 40 36 24 50 12 6 1 11 7

Canned and dairy products

Full Cream milk ('000 litres) 731 1,097 1,133 969 1,302 1,803 1,810 2,040 2,233 2,254 503 578 257 448 433Skimmed milk ('000 litres) 138 246 442 292 0 0 0 0 0 0 0 0 0 0 0Chocolate milk ('000 litres) 32 31 121 67 0 0 0 0 0 0 0 0 0 0 0Yogurt (plain and flavoured) ('000 litres) 13 9 10 74 40 37 67 168 107 124 31 30 35 39 32Juices ('000 litres) 1,765 2,107 2,578 2,718 2,983 2,768 3,054 3,158 3,126 3,946 566 521 398 611 891Squash ('000 litres) 182 183 242 199 161 123 116 116 220 231 27 15 56 22 67Jam ('000 litres) 43 45 54 45 51 54 83 20 26 37 13 9 3 4 8Sauces ('000 litres) 148 171 180 226 230 296 315 308 378 406 96 112 99 112 89

Electricity production (5) (m. kwh) 126 129 133 148 159 172 189 210 219 224 57 56 58 60 60

Source : National Statistics Bureau.

Notes : (1) Le Rocher Abattoir only. (2) Commencement of operation started in June 1987, COI. (3) Total catch of fish, SFA. (4) Includes soft drinks produced by Waterloo factory since January 1990. (5) Includes Praslin, Ste Anne Island and La Digue from June 1981, September 1984 and June 1985 respectively.

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Table 26 (1)

SEYCHELLES CONSUMER PRICE INDEX

Year 2001 = 100

(2) Fish Other Food Non-Food Imported Local All Items Change

2.6 25.6 71.9 37.5 62.5 100.0

1990 67.0 98.6 71.0 76.6 75.0 75.5 3.91991 67.6 101.2 72.1 78.9 75.9 77.0 2.01992 71.9 102.4 75.0 81.1 78.6 79.5 3.21993 81.1 103.7 75.1 81.5 80.1 80.6 1.31994 88.8 94.3 78.9 78.0 84.1 82.0 1.81995 94.8 92.9 78.7 78.5 83.5 81.8 -0.31996 87.8 90.8 78.4 78.1 82.3 80.9 -1.11997 93.2 91.4 78.4 79.0 82.7 81.4 0.61998 109.0 92.4 80.5 80.1 85.3 83.5 2.71999 92.3 94.1 87.4 88.4 89.1 88.8 6.32000 86.4 96.8 94.3 92.2 95.5 94.4 6.32001 100.0 100.0 100.0 100.0 100.0 100.0 6.02002 104.9 100.2 100.0 99.4 100.6 100.2 0.22003 114.3 102.0 103.6 101.6 104.6 103.5 3.32004 106.2 103.9 108.8 106.3 108.2 107.5 3.92005 111.9 104.5 109.7 106.3 109.8 108.5 0.9

2003Oct. 115.5 103.9 106.6 104.4 107.2 106.2 5.5Nov. 115.0 104.3 106.7 104.6 107.4 106.3 6.0Dec. 102.5 104.5 107.6 105.5 107.4 106.7 6.7

2004Jan. 103.2 106.1 108.2 106.6 108.1 107.5 6.8Feb. 119.0 105.6 108.2 106.8 108.3 107.8 6.6Mar. 112.3 105.9 108.6 106.8 108.7 108.0 7.1Apr. 94.5 105.8 108.6 106.8 107.9 107.5 6.4May 87.6 105.7 108.6 106.9 107.5 107.3 6.1Jun. 113.2 105.6 108.8 107.4 108.5 108.1 6.9Jul. 114.8 102.1 108.8 105.5 108.3 107.3 2.1Aug. 124.7 101.1 108.8 105.3 108.5 107.3 1.7Sep. 108.2 101.4 109.2 105.6 108.1 107.2 1.0Oct. 105.2 102.0 109.1 105.7 108.1 107.2 1.0Nov. 99.0 102.3 109.1 105.7 107.9 107.1 0.7Dec. 93.2 103.6 109.2 105.8 108.4 107.4 0.72005Jan. 104.7 104.5 109.3 105.7 109.3 108.0 0.5Feb. 103.3 105.0 109.3 105.8 109.4 108.0 0.2Mar. 101.8 104.1 109.9 106.9 109.0 108.2 0.2Apr. 96.2 104.3 109.9 106.8 108.8 108.1 0.6May 94.4 105.1 110.1 106.9 109.4 108.5 1.1Jun. 105.3 105.9 110.1 106.6 110.3 108.9 0.7Jul. 110.8 106.2 110.1 106.6 110.7 109.1 1.7Aug. 129.0 104.8 110.2 106.5 110.9 109.3 1.9Sep. 137.1 103.8 110.0 105.9 111.1 109.1 1.8Oct. 123.5 103.4 110.1 106.0 110.4 108.7 1.4Nov. 117.9 104.3 110.1 106.0 110.5 108.8 1.6Dec. 119.1 103.1 107.5 105.5 107.4 106.7 -0.7

2006Jan. 123.4 104.2 107.5 105.6 108.0 107.1 -0.8Feb. 116.9 105.1 107.5 105.6 108.1 107.2 -0.7Mar. 114.9 106.9 107.3 106.9 107.7 107.4 -0.7

Source : National Statistics Bureau.(1) The index is based on prices collected from Victoria, other neighbourhoods in Mahe and Praslin. Weights were derived from the results of The Household Expenditure Survey, 1999-2000. The weights represent the average expenditure of households covered by the survey. (2) Percentage change in the All Items Index over the same period in previous year.

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