Press release

SONA: I Love Seychelles! – Let us rededicate ourselves to the progress of our country and the wellbeing of our people

February 27, 2015

President James Michel delivered his 11th State of the Nation Address to the Seychelles National Assembly this afternoon, placing emphasis on the principles of patriotism, empowerment, national unity, social harmony, solidarity, entrepreneurial spirit, and family values for the development of Seychelles? economic and social wellbeing.

Mr. Michel said the world economy in 2014 remained fragile, with a particularly poor performance in the Euro zone which impacted negatively on the Seychelles economy, which relies mainly on tourism, where the gross domestic product (GDP) was 2.8%? smaller than was predicted ? mainly because of a reduction in activities relation to tourism and industrial production.

He said that 2014 was a year of challenges for the tourism sector.? Although there was a 1% increase in the number of tourists, there was a reduction of 3% in the number of visitors from Europe, estimating that tourism revenues were 5% lower in 2014 than in the preceding year.

In terms of expansion in the tourism sector, Mr. Michel said that there was an increase in the number of hotel establishments from 426 in 2013 to 467 in 2014.? Over 60% of those establishments are owned or managed entirely by Seychellois.

Concerning the balance of payments, the Seychelles deficit in 23% of the Gross National Product, with?foreign exchange reserves rising from US425 million in 2013 to US464 million in 2014.? This represents the equivalent of 4 months importation, compared to 2008, when the foreign exchange reserved represented the equivalent of only 3 weeks’ importation.

With regard to external debt payments, foreign exchange reserves represent about 94% of the external debt.

?This is a strong indication that Seychelles does not anticipate any difficulties in meeting its external debt repayments over the years to come. Fiscal discipline remains a key element in our strategy to strengthen our economy.? The positive fiscal performance of 2014, and the successes we have had in our debt restructuring, have helped to considerably bolster the sustainability of Seychelles’ external debt.? We must maintain this strategy for us to achieve our aim of reducing public debt to 50% of our Gross National Product by 2018,? said President Michel.

He noted that the financial agency Fitch Ratings has maintained Seychelles? position at B+, with a favourable economic environment.

?This rating shows that in spite of the major challenges in 2014, our fiscal and monetary policies have helped to bring stability and build resilience, and to lay of the foundations for a more solid economy in the future.?

The President said that the purchasing power of Seychellois continues to increase.? For example, according to immigration statistics, over 20,000 Seychellois travelled overseas in 2014.? Over 95% of households have access to modern means of communication, making Seychelles the top country in Africa in terms of development, penetration and access to information communication technology.? The number of vehicles on our roads today, according to the Seychelles Licensing Authority, is 20,291 which includes 12,878 private vehicles.

?In 2014, we have seen a 25% increase in credit or loans which the private sector have borrowed from commercial banks.? This is one of the principal factors which has contributed to a considerable increase in consumption.? This has resulted in an increase in demands for imports, and has created pressure on our balance of payments.? At the same time, our balance of payments has been impacted by a reduction in revenues.?

He said that in view of this pressure, and since the value of the Rupee depends on the demand in the economy, the value of the Rupee was adjusted.? During 2014, the Rupee depreciated by about 70 cents, or 5.8% in comparison with 2013, before it stabilised at a higher level.? The Central Bank tightened its monetary policy, and Government also maintained its fiscal policies.? These factors helped to stabilise the value of the Rupee, he added.

?The lowering of the price of energy, and better economic performance are expected to reinforce this position.? This adjustment in the exchange rate, combined with tighter monetary policy, has resulted in a lowering of demand for foreign exchange since the start of 2015.? The reduction in demand is also contributing to the strengthening of the value of the rupee.? It will help to lower the cost of living,? he said.

Mr. Michel announced that lower electricity charges and lower costs of cooking gas would be communicated by the PUC and SEYPEC in the coming days.

The President concluded by saying that the Seychellois people are together building a modern, dynamic, visionary small nation that is a model of peace, unity and tolerance for the world.

?How can we not be proud of our accomplishments? How can we not be proud of our country? How can we not be proud of this new dream? Together ? wherever we may be ? let us rededicate ourselves to the progress of our country and the wellbeing of our people. Our new dream begins with this. Our new dream is founded on our national unity.? It is founded on our harmony as a people. A people who stand together. A patriotic people. Our new dream is inspired by love for our motherland. Together, let us proudly proclaim:? I LOVE SEYCHELLES!?

The President presented several Government work results and priorities for the next year. The following is a summary of the main points made:

US million Paris Club agreement for debt-swap

President Michel announced that Seychelles last night signed an historic debt buyback agreement with?the Paris Club of creditors.

?Our Blue Economy message is being realised through innovation and concrete action to reduce our vulnerability.? Last night, Seychelles has once again created history.? Our proposal for a partial exchange of our debt in return for financing action to mitigate against climate change has been accepted by the Paris Club.? This means that about US million of our debt will be transferred in terms of a fund for the protection and development of our marine space ? our Blue Economy.? In addition, our partners are giving us a further 5% reduction in that debt. Through this debt exchange, we shall be better able to protect our oceans, create opportunities for artisanal fishing, reduce our foreign exchange payments, and keep more money within our economy,? said the President.

Small and Medium Enterprises Incentives Act


President Michel announced that the Government is working on new legislation to encourage Seychellois business development, with the planned introduction a Small and Medium Enterprises Incentive Act.

?In order for the Seychellois to really take ownership of their economy, they need mainly certain financial, fiscal, legal and other incentives. Our small entrepreneurs need a framework which will encourage them to invest in the productive sectors. My government is aware of this. It is for this reason that we are working on a Small and Medium Enterprises Incentive Act. We will introduce this legislation this year. It will enable small entrepreneurs to benefit from certain concessions and incentives when either starting up business ventures or for expansion of existing businesses, provided they meet the necessary conditions. The Development Bank of Seychelles will be a principal pillar in this empowerment strategy for small and medium enterprises. We will strengthen and increase the Bank?s resources.?

He said statistics show that up to December 2014, a total of 241 loans amounting to SR233 million had been approved under the scheme for small and medium enterprises (SME).

The President announced that Government has already completed the construction of micro-enterprise centre at Providence, which will be opened soon.

?We shall be building a second one at Ile du Port.? We have plans to build other centres in various regions of Mahé, Praslin and La Digue.? We shall continue to encourage all Seychellois to be enterprising.? Encourage everyone to work hard.? We must create a better environment for doing business in our country.? Create more employment.? Increase productivity.? Let us work together to remove obstacles that hinder our people.? Many people complain that their principal sources of frustration is the Licensing Authority, the Planning Authority, or the Customs.? We really must get ourselves in order!?

Mr. Michel said that Seychelles actually ranks 85th out of 189 countries where it concerns ease of doing business.

?We can do better than that ? much better.? Our strategy is to improve our rank and place ourselves among the 30 best countries for doing business in the next 5 years.?

Cap Ternay Hotel development


President Michel announced that the proposed major hotel development at Cap Ternay on Mahe Island would not be going ahead, for environmental protection reasons.

The President said that it is unfortunate that ?certain people had decided to play politics? with the Cap Ternay hotel development, where they accused him of destroying the environment and the reputation of Seychelles.

President Michel defended his record, saying ?You all know, especially those who accuse me, that if there is anyone who has always defended our natural heritage, our environment ? and continues to do so ? it is me!? On the international scene, I have defended the cause of the environment, of the Small Island States, with vigour, with passion, and the same conviction.”

Mr. Michel, said that all major tourism projects, including hotels, are subjected to an environmental impact assessment and that the Cap Ternay project is no exception.

?We always follow the same principle.? I have listened, consulted and studied the reports, the scientific reports that were submitted to me. All the scientific arguments suggest that such a project will affect the environment of the area. Naturally, as the President of this country, it is my duty and responsibility to take the best decision in the interest of the Seychellois people, and for the protection of our heritage. I have decided that there will be no such project at Cap Ternay. The promoters of the project have understood, accepted and respected my decision unreservedly.? They have assured me that it was never their intention to do anything to spoil the reputation of Seychelles as a champion of environmental protection and management. This is a responsible government in action. A government that listens. A government that takes its responsibility seriously,? he said.

Fisheries and Agriculture

President Michel said that the 2014 inauguration of a new 120-metre fishing port at Ile du Port has already begun to show its benefits in terms of port transactions and a reduction in the amount of container traffic on the roads.? In 2014 the Government also signed an agreement for the construction of another larger 425-metre industrial fishing port on Ile du Port as part of a public-private sector partnership venture.

?We also built facilities for fish processing on the Providence fishing port.? We anticipate that these new investments in the fisheries sector will contribute to more value-added benefits and a new thrust for the Blue Economy.?

In 2014 the Government introduced an insurance scheme for fishermen and farmers. There were also measures to strengthen capacity and boost training.

?We expanded collaboration with international institutions, such as the Food and Agriculture Organisation (FAO), the International Fund for Agricultural Development (IFAD) and the African Development Bank (ADB). With the intensification of the multilateral cooperation programme, farmers and fishermen will not only benefit from the strengthening of capacity and training, but also from financial assistance and development of infrastructures.?

He said that Seychellois have always accorded great importance to the ocean and always considered it a key element in their identity as a nation.

?Our national anthem reminds us that we need to protect the wealth of our oceans, which are precious heritage for future generations. This heritage also represents a big opportunity. New research and new technology can create a new sector of prosperity for our people, while we consolidate our assets. Several Seychellois entrepreneurs are already seizing this opportunity.?

He said the new Blue Economy Department that has been established responds to the need to ensure a better coordination of efforts, and also to ensure that necessary framework is created to facilitate innovation and wealth creation.

??. while also strengthening our means of protecting our resources. This will allow Seychellois to take ownership of their Blue Economy.?

Health services

The President said that there are aspects of the state health system which have weaknesses that need to be eliminated.

?A big challenge for us was infant mortality rate. It had reached 18.52 per thousand births in 2013. We succeeded in reducing it to 10.92 per thousand in 2014. We will aggressively pursue our efforts to improve prenatal and postnatal care.? We will continue to place emphasis on prevention and improved detection.?

He said that the Government would continue to modernize the health system and introduce more specialist care.? Following an audit of the laboratory service by an international team it will be modernized, and he also said there are plans for its international accreditation and subcontracting of its services.

?The operating block in the Seychelles Hospital has been upgraded and fitted with new equipment. We are now able to perform certain complex surgeries here in Seychelles instead of sending patients overseas? We are recruiting more specialists. In this context the government of Abu Dhabi is providing us with assistance for four years to recruit the specialists we need to improve the quality of our health services. We are conducting negotiations with an international company for the management of our dialysis centre and its international accreditation.?

Mr. Michel said that his vision for the health system is to have it managed and operated by Seychellois professionals within 10 years.

?It is for this reason that we are giving priority to the training of our young Seychellois cadres in different medical specialities.? In this context, the Ministry of Health is planning to send some 20 young Seychellois doctors on specialization studies overseas.?

Police Child Protection Team


President Michel addressed the issue of child neglect and abuse, and said that people had? asked the Government to introduce harsher punishments against those who destroy the innocence of our children.

He announced that a Police Child Protection Team would be set up to work with Social Services in order to bring cases to court when abuse takes place persistently.

?There have been calls for the Police, Social Services and the Judiciary to become more effective when dealing with child abuse and neglect cases. I have listened to them. I am setting up a Police Child Protection Team which will work closer with the Social Services Division on all child abuse cases. The team will also conduct investigations and bring cases to court against parents who persistently neglect their children and put them at risk for abuse.? Such measures are in place in many countries. It does not only expedite court cases, but it also brings the different services under one roof. We owe this to our children.”


Paternity leave


President Michel announced that men in Seychelles will for the first time be able to apply for paternity leave, for 5 days, on the condition that the father acknowledges the newborn.

?The raising of children is a shared task, a shared responsibility. The birth of a child is an exceptional event. It is an event that brings much joy and responsibility. To enable fathers to participate fully in the first days of the life of a baby ? with all the responsibilities involved ? Government has decided to give five days of paternity leave?.. This benefit will take effect very soon.?

Education Strategy


President Michel said that the National Consultative Forum?s meetings last year dedicated much attention to Education, particularly the Medium-Term Strategy of the Ministry of Education. He said the strategy has been formulated in collaboration with the European Union and UNESCO and that its aim is to undertake further transformation of our education and training system over the next five years and beyond.

?The restructuring of the Ministry of Education will help it provide the leadership and direction necessary for the implementation of this pivotal Medium-Term Strategy. Our country has already achieved universal primary education, which was one of the millennium development goals. We have progressed beyond this goal. Our children have access to free education and compulsory schooling up to S4. We now have to focus on improving quality, especially in secondary and post-secondary education.?

He said that in the last ten years about 1,200 young Seychellois graduated from universities overseas, and that now the University of Seychelles is playing a crucial role in the creation of the knowledge and skills based society.

?It started with 53 students five years ago. The University of Seychelles today has cooperation programmes with several universities and institutions of learning overseas. It has almost 1,000 students. This year some 100 Seychellois students are expected to obtain their degrees from our University. Many others will receive their diplomas or certificates from the University. The University of Seychelles, which was ridiculed when still a project, is readying itself to welcome its first foreign students. The motto of the University sums up well its mission: The future is in your hands!? It is bringing us closer to the transformation of our vision into reality ? a graduate in every family! The realization of yet another promise I made to the Seychellois people!?


Government Housing and Land Schemes


The President said that in 2014, 304 Seychellois families were given the keys to their own homes. 82 were offered plots of land.

He said that in 2015 the government shall again make available some 200 houses to Seychellois families.? In addition, construction work is starting this year on 267 residential units in different regions of Mahe and Praslin.

There are also have plans to start work on several units on Ile Perseverance. He said the construction of a bridge connecting Ile Aurore and Ile Perseverance later this year will open up many more opportunities in the residential and commercial sectors on both islands.

?It is now that we see the importance of Ile Perseverance, and soon also Ile Aurore, in our housing programme.? If we had not undertaken the land reclamation — which was criticized at the time when dredging work started — where would we have housed all these Seychellois families today?? Where would we have located all these businesses? Now there is a visionary government!?

The President said 52 plots of land on Mahe and Praslin are ready for allocation. Some 50 additional plots will be ready this year for distribution on Mahe, Pralsin and La Digue.

He said that statistics indicate that presently about 85% of Seychellois families own their houses.

?This is a true accomplishment! We now have to take our responsibilities and commitments seriously. We have to repay our loans regularly, so that other Seychellois, too, can realize their dreams of owning their homes. We have to save for our future homes. We should also abide by a code of conduct that promotes good neighbourliness in a community that stands together.? My government will, through various housing programmes, continue to help each Seychellois family to become home owners.?

Furthermore there are 66 families on the housing application list that have already been selected for the first self-financing scheme on Ile Perseverance. He said this programme will be implemented in other housing projects across the country with the objective is to speed up applicants? access to housing.

Public-Private Sector Partnership for Housing

President Michel said that the Government will actively encourage the private sector to enter into partnership with Government to build and sell affordable houses.

? Our Land Use Plan for Ile Perseverance includes a site for residential and commercial development by the private sector. According to the plan, up to 240 residential units and 4,800 m2 of commercial space will be built. This project will be put on tender in a few months. Wherever there is potential and interest, we will put more land at the disposal of Seychellois entrepreneurs, in order to encourage such public-private sector partnerships. In this context, Government is considering making available land at Anse Royale to Seychellois entrepreneurs for the construction of residential facilities for local and foreign students attending the University of Seychelles. Yet more business opportunities for Seychellois!?