Seychelles Country Report

Seychelles' political landscape has traditionally been dominated by the People's Party (Parti Lepep: PL), now the United Seychelles Party (U-SEY), led by President Danny Faure, who took over from James Michel following his resignation in 2016 after U-SEY lost its parliamentary majority to the Seychellois Democratic Alliance (Linyon Demokratik Seselwa: LDS) opposition coalition. The presidential election, due in December 2020, is likely to be close-run between U-SEY and LDS candidates, but modest fundamental policy differences between the main parties assists policy stability. Social unrest is rare although peaceful demonstrations are likely in the run-up to the presidential election. The government has acknowledged a crime rate increase, particularly on main island Mahé, and set up the National Intelligence Agency in December 2018, which is likely to mitigate the main risks of financial crime and illegal fishing. Petty crime is likely on Mahé and Praslin islands, although levels are low compared to regional levels. Seychelles continues to improve its overall business environment, as shown by its improved World Bank Doing Business report ranking. Tourism, fisheries, and offshore financial activities are the main stimulants of growth. However, the economy's high dependence on tourism for foreign exchange earnings leaves the external account vulnerable to developments in major tourist markets, such as the European Union and, increasingly, China. The country's lack of land as well as its physical remoteness will continue to constrain Seychelles' growth prospects. New offshore hydrocarbon discoveries and installation of floating solar panels are likely to reduce Seychelles' dependence on energy imports and boost its economic diversification. The government has offered exploration tenders for offshore deep-water blocks along the Seychelles-Mascarene Ridge Basin, containing an estimated 797 million barrels of oil, and has signed production agreements with two oil companies, PetroQuest International and East African Exploration. Exploration will likely be tightly regulated in keeping with Seychelles' 'blue economy' water resources sustainability.