UAE plays its part in Seychelles’ burning ambitions

Life can be stressful for residents in the idyllic islands but the Seychelles, helped by the UAE, has plans to change all that. Its Blue Economy strategy will function as a safety net as it develops housing, the environment and tourism.

The Perseverance housing development in Victoria, the Seychelles’ capital on Mahe island. The affordable-housing project, which will provide 2,000 houses once finished, is being built with the help frShow more

Rose Bertin, 52, stands in the central market of Victoria, the capital of the Seychelles, surrounded by bottles of coconut oil, cinnamon, salted fish and other products that she sells.

She knows all her products well, but the coconut oil is an old friend. At the age of eight, Mrs Bertin had to leave school to look after her younger siblings. Growing up with no electricity in the house, she had to burn coconut oil to get light.

“Now we get water running from the sink, but everything comes with good and bad things. That’s the way it is,” she says, referring to the low wages that her son and daughter get by working at an international brand hotel while paying a hefty amount to commute across the main island of Mahé.

Despite the country’s extraordinary natural beauty that has earned it a reputation of a “picture perfect” idyll, life can be pretty stressful for the Seychellois people, who depend on the tourism sector for about 15 per cent of formal employment. The fortunes of other industries from banking to construction are also closely tied to tourism in the island nation of about 450 square kilometres – smaller than the city of Chicago.

Lack of land in what is the smallest country in Africa has always been a constraint, and most of the capital is situated on reclaimed land. The last reclamation took place between 1998 and 2002, according to Christian Lionnet, Seychelles minister for land use and housing.

“We reclaimed 352 hectares of land. At the time, crude oil was at US$18 per barrel. We were very lucky to reclaim back then, because today the reclamation would cost us [a total of] $55 million. Also a dollar was worth five rupees (Dh1.37) at the time. Now it’s worth 13 rupees.”

The archipelago’s economy suffered after the financial crisis eight years ago, especially following the decision to let its currency trade freely in 2008. In November of that year the dollar increased to 17.5 rupees. In the mid-’90s it had been at record lows of approximately 4.5 rupees.

The Seychelles economy began to recover in 2010 and it grew 3.7 per cent last year and is expected to grow 3.8 per cent this year, according to the IMF.

Mr Lionnet said there remains a “very huge gap” between the supply and demand for housing in the country. The government builds 300 to 500 housing units per year while current demand is for an annual 4,000 homes.

A perceived problem is the number of expats in the country competing with the Seychellois for the same homes. There are about 13,413 expats in the islands group out of the total population of about 90,000.

“Expats are driving prices up,” says Mr Lionnet. “Now we are trying to get big industries to build their own accommodation for the expats.

“Every year, we spend $11m to $12m dollars in housing,” said Mr Lionnet. The budget for this year has been set at $422m, the country’s then minister of finance, trade and investment, Pierre Laporte, said in December.

The UAE, which has developed close ties with the country, is supporting government efforts to tackle the housing shortage.

The government launched the Perseverance Housing Estate initiative in 2005 to build 2,000 affordable homes. While 1,000 units have been built, the project was temporary stopped during the financial crisis.

The UAE is financing 142 units of the Perseverance Project as part of a grant. It is also supporting other aspects of economic development.

In 2011, the president of the Seychelles, James Michel, asked Sheikh Khalifa, President of the UAE, for help to formulate a master plan for the development of the country. The strategy is similar in scope to Abu Dhabi’s 2030 vision.

“We wanted a plan that would help us best utilise the resources in Victoria for the next 20 years,” says Mr Lionnet.

It focuses on the model of the Blue Economy, which includes the concept of using what is locally available for job and revenue creation with reduced energy use, all the while ensuring that any initiatives benefit the communities involved.

Proponents of the Blue Economy include Gunter Pauli, who has sometimes been called the “Steve Jobs of sustainability”.

Ideas for the Seychelles Strategic Plan 2040 also include the development of a tram system or a monorail, according to Mr Lionnet. “There have been talks about sea transport or building cable cars for scenic views,” he says. “It will be nice to have cable cars that go to the mountain to enjoy the view.”

According to Abu Dhabi’s Urban Planning Council (UPC) its work on the Seychelles 2040 plan is its first international collaboration.

“The Blue Economy [model] is an opportunity for the Seychelles. They can take advantage of the marine environment for fishing, tourism, shipping, but need to ensure its protection,” says UPC’s Ahmed Al Kuwaiti, who is project manager for the Seychelles strategic plan.

In 2013, the Abu Dhabi Fund for Development, together with the renewable energy firm Masdar, built the Port of Victoria Wind Farm in the archipelago. The wind farm consists of eight wind turbines, with capacity to produce seven gigawatt hours of clean energy per year – enough to power about 2,100 homes, or 8 per cent of Mahe’s grid capacity.

Tourism, however, is the main contributor to the country’s growth, accounting for half of its GDP and the majority of its foreign exchange earnings. About 230,272 tourists arrived in the Seychelles in 2014, up 1 per cent from a year earlier. Visitors from Europe decreased last year but were replaced by new markets such as China.

The national carrier Air Seychelles, in which Etihad Airways took a stake in 2012, has stepped up its service to France, one of its biggest source markets, resuming non-stop flights to Paris from July.

Air Seychelles plans to boost passenger numbers by 15 per cent this year after carrying 412,088 passengers in 2014.

Mr Lionnet says that while the Seychelles has developed a diverse hotel sector, it can do better to provide more entertainment options in the country.

“People [who] come here need to have a diversity of things to do,” he says. “Not only the sand, beach, and sea. We want to develop restaurants, different products that people can buy. We need more entertainment areas.”

Back at Victoria’s market, Mrs Bertin smiles brightly and in a Creole accent says: “Everybody thinks it’s good to have hotels and developments in Seychelles. It’s good for work. It’s good for the people.”

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