Seychelles Investment Policy

Location of Seychelles

Seychelles’ location outside the cyclone belt, in a time zone whose working hours overlap with those of major financial centres, its excellent sea and air connections with Europe, USA, Asia and Africa make it an excellent place to conduct business.

An efficient telecommunications system together with other advantages such as the extensive facilities available at its harbour, Port Victoria, and a well-developed infrastructure with attractive investment incentives, offer the ideal business environment to investors.

In order to fully capitalize on the above, the Seychelles Investment Bureau (SIB) was established in July 2004, as the first point of contact for all matters relating to investment and business in Seychelles.

Capitalising on the work of its predecessor, SIBA, SIB’s objectives are to promote Seychelles as the ultimate environment for business, foster an investor-friendly culture and assist investors to establish and expand their respective enterprises.

Its main activities include:

1) Enhancing the awareness of Seychelles as the location for investments both at home and abroad and to promote investment opportunities in all sectors of the economy.

2) Providing facilitation services to investors and acting as the focal point of contact amongst local and foreign entrepreneurs and all Government/private organisations

3) Expediting the processing of investment proposals in an efficient manner for the consideration of Government

4) Conducting research and make recommendations on investment related matters.

Economy Overview

Since independence in 1976, per capita output in this Indian Ocean archipelago has expanded to roughly seven times the pre-independence, near-subsistence level, moving the island into the upper-middle income group of countries.

Growth has been led by the tourist sector, which employs about 30% of the labor force and provides more than 70% of hard currency earnings, and by tuna fishing. In recent years, the government has encouraged foreign investment to upgrade hotels and other services. At the same time, the government has moved to reduce the dependence on tourism by promoting the development of farming, fishing, and small-scale manufacturing. Sharp drops illustrated the vulnerability of the tourist sector in 1991-92 due largely to the Gulf War and once again following the 11 September 2001 terrorist attacks on the US.

Economic growth slowed in 1998-2002 and fell in 2003-04, due to sluggish tourist and tuna sectors, but resumed in 2005-07. Real GDP grew by 5.8% in 2007, driven by tourism and a boom in tourism-related construction. The Seychelles rupee was allowed to depreciate in 2006 after being overvalued for years and fell by 10% in the first 9 months of 2007.

Debt and Aid
Debt: $1.059 billion (31 December 2007 est.)
Aid Given: N/A
Aid Received: $18.81 million (2005)

Labour Force
Number in labour force: 39,560 (2006)
Sectors: agriculture: 3% industry: 23% services: 74% (2006)
Unemployment: 2% (2006 est.)

GDP Facts and Figures
Currency: Seychelles rupee (SCR)
GDP: $1.378 billion (2007 est.)
GDP Per Capita: $16,600 (2007 est.)
GDP Real Growth: 5.3% (2007 est.)
GDP Composition: agriculture: 2.4% industry: 25.7% services: 71.9% (2007 est.)
Production Growth Rate: 1% (2007 est.)

Industries, Land Use and Resource Consumption
Industries: fishing, tourism, processing of coconuts and vanilla, coir (coconut fiber) rope, boat building, printing, furniture; beverages
Land use: arable land: 2.17% permanent crops: 13.04% other: 84.79% (2005)
Exports: canned tuna, frozen fish, cinnamon bark, copra, petroleum products (reexports)
Electricity Consumption: 216.6 million kWh (2006)
Natural Gas Consumption: 0 cu m (2005 est.)
Oil Consumption: 6,453 bbl/day (2006)

Why invest in Seychelles?

Seychelles is a country with profound and strategic location favorable for investments. Amidst the Southwestern Indian Ocean, Seychelles offers political stability with appropriate administrative and established legal frameworks.

These features leave no doubt fro Seychelles as an ideal investment destination for stern investors willing to cater to European, African, Asian and definitely the local markets. The global competitiveness and incentive packages and concessions awaiting suitable traders and businesses further invite investors to Seychelles.

Cyclones and other natural disasters are a bit of a worry in Seychelles, being located outside the cyclone belt. The convenient time zone of which overlap the working hours of major financial centers, is an excellent sea and air connections with Asia, USA, Europe, and Africa, making it an excellent location to conduct business.

Its telecommunication facilities (internet access and domestic as well as international calls) as well as well-developed transportation (Port Victoria and international flights) system provide an array of advantages that supports the attractive investment incentives facilities. These infrastructures provide a perfectly crafted support and an ideal environment to investors.

Finally, the government has set up a structure in July 2004, the Seychelles Investment Bureau (SIB) as an access point regarding all matters with regards investment and trade in Seychelles. SIB aims to promote Seychelles as a convenient and lucrative environment for business, encourage an investor-friendly culture and help investors create and expand their respective ventures. An e-brochure is available to download for a summary and/or full version of the section About Seychelles.

The main activities of SIB include:
Promoting an enhanced awareness on Seychelles, both domestic and international, as a perfect location for investments or ventures as well as encourage investment to opportunities in all sectors of the economy
Offer services that facilitate the access of investors by standing as the focal point of contact between local and foreign capitalists including private/government organizations.

Facilitate the approval of proposals for investment with efficiency for Government deliberation Conduct research as well as provide recommendations on matters related to investment.

What are some of the key features of the new investment code in Seychelles?
The government of Seychelles put more effort to rationalize the existing raft of business and investment laws by commencing a new investment code. The law was enacted by the National Assembly by end of November 2005 still carries restrictions that exist on foreign investments in selected sectors however seeks provide transparency of the whole process.

The sectors reserved for domestic investors are various parts of fishing, tourism, agriculture and probably the provision of internet services.

Specifically, hotels and guest houses with rooms lesser than ten may be restricted for Seychellois interests. This includes other small scale enterprises like construction that are dominated by the locals.

The government declared though that foreign investments shall be encouraged to what they classify as “strategic sectors”, which includes water, telecommunications, power and mining industries. Furthermore, operating within the Seychelles International Trade Zone will exempt or avoid foreign companies from any restrictions.

The law has also defined a process for resolving conflicts that arise between the government and foreign investors. A clause in the new investment code guarantees before the law to foreign capitalists ensuring equal tax and legal treatment with local firms as well as protection of their property. The code provides further that foreign companies are afforded the right to expatriate their profits, whether in foreign or local currency.

The features offered by the new code are hopefully measures to overcome the major obstacles and concerns that have been discouraging foreign companies that also persist in the rest of Africa. In Seychelles, although the GDP per capita is relatively high, the economy remains to depend highly on tourist revenues whereby the new law is a hope of the government to create a balanced economy.

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