Introduction
Over the past few years, the economy of Seychelles has recorded rapid growth as an investment into various industries such as tourism continues to increase. In the early 1970s, the fortress of development was farming plantations until the opening of the international airport, such that there was growth in the tourism sector (The Seychelles org, 2016). In particular, this was a deciding moment for the country as there was diversification where the majority of the people started to rely on tourism while the plantations farming stagnated. Notwithstanding, many individuals in the country decided to embark on fishing as an economic activity, and this increased the produce with many people focusing on tuna farming (The World Bank, 2016).
According to statistics, it is evident that more than 30% of the population seeks employment in the fishing industry yet this attributes to approximately 70% of the earnings. With the help of the government, Tuna farming receives a boost especially with the coalition of foreign investments such as hotelier and hospitality industry (The Heritage Org, 2016). Due to the growing dependence on tourism, the leadership promotes other forms of trade such as farming, fishing, and manufacturing on a small scale. Thus, this paper focuses on the economy of the country and provides information on the development, currency, earnings and trade partnerships with other countries.
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The country uses the Seychelles rupee as a legal tender that the population can use to exchange products. According to the recent conversion rate, one SCR is equal to 0.075 US dollar, which in translation means that approximately 13.35 SCR are equal to 1 USD. Imperatively, the government shows concerns about the expansion of agricultural sector, but they experience a glut in the development of the sector. For this reason, the country imports almost 90% of the food that the population consumes with exceptions of products such as pork, fruits, vegetables, fish, cigarettes, beer and plastic items that they make locally (The World Bank, 2016). Ideally, tourism is considerably the major economic activity that accounts for 20% of the gross domestic product (The Heritage Org, 2016).
Additionally, there is reliance on the fishing industry as the area has over 1000 species of fish. In this context, the country has ties with Heinz, which is a majority shareholder in the tuna canning institutions. Additionally, a significant percentage of the population is in the farming industry, and they produce various products such as bananas, sweet potatoes, cassava and tea. According to statistics in 2013, it is noted that the country had a population of approximately 89, 000 while the expectancy rate is 72 years, which is considerably better in comparison to other African countries (The Seychelles org, 2016). Nonetheless, the leadership has gained interest in offshore mining. In particular, research suggests that the adjacent areas are rich in oil and this could be a fortune for the economy.
The economy of Seychelles is dependent on various activities such as farming, fishing, and tourism although the food consumption is mostly dependent on imports. However, the commitment by the government to improve the output of industries and increase the rate of return on economic activities such as tourism is crucial to the development of the nation (The World Bank, 2016). Consequently, the leadership defines specific trading partners that could enhance the economic growth and this includes France, the United Kingdom, Italy, Japan and Mauritius. On the other hand, the ideal import destinations include Spain, France, South Africa and China. Nonetheless, statistics indicate that the country has a Gross domestic product of $ 2.4 billion with a projected growth of approximately 2.9%. Additionally, the inflation rate in 2016 is estimated at 1.4% while the gross national product in 2013 was $2.116 billion. In particular, the changes in the development of the country can be attributed to the drop in the unemployment rate as the current rate is 4.2%.
During the financial crisis that the world experienced in 2008, the tourism and fishing industry were affected such that the country lapsed payment of the debt of approximately $ 230 million although the IMF had to rescue the nation with a package of $ 26 million. At this time, the foreign debt increased to 175% of its GDP, but this has declined to at least 65% (The Heritage Org, 2016). According to the current statistic, it is evident that the country has incepted various measures that seem to improve its economy with focus on the GDP, GNP and the unemployment rate, which are all economic indicators (The World Bank, 2016).
Importantly, the United States has bilateral trade ties with the Seychelles such that the two countries can trade freely. Over the years, the two nations have been in transactions although the proceeds of the trade are minimal. Imperatively, the Seychelles is involved in various trade blocks such as the common markets for east and central Africa (COMESA), Free Trade Area (FTA), the Indian Ocean Rim-Association for Regional Corporation and the Indian Ocean Commission (The Seychelles org, 2016). Thus, the involvement of the country in these blocks is an indication of the leader's commitment to steering the country to economic development and association with other countries so that they can solve some of the recurrent problems.
Conclusion
In conclusion, the Seychelles focuses on the development of the nation through various initiatives in the tourism, fishing, and farming industry. Although the country imports almost 90% of the foods that the population consumes, its dedication to increasing production of various foodstuffs such as banana, tea, cassava and sweet potatoes is a crucial perspective that will enhance economic emancipation. Additionally, there is a need to diversify investments such that the country reduces overreliance on tourism and fishing.
References
The Heritage Org,. (2016). Seychelles Economy: Population, GDP, Inflation, Business, Trade, FDI, and Corruption. Heritage.org. Retrieved 18 October 2016, from http://www.heritage.org/index/country/seychelles
The World Bank,. (2016).Seychelles Overview Worldbank.org Retrieved 18 October 2016, from http://www.worldbank.org/en/country/seychelles/overview
The Seychelles org,. (2012). The Economy of the Seychelles So Seychelles Retrieved 18 October 2016, from http://www.seychelles.org/seychelles-info/economy-seychelles
