The Seychelles decided to seize on the potential its vast EEZ offers by adopting a Blue Economy Roadmap in January 2018. A Blue Economy, or BE, is defined by the Seychelles as economic activities that directly or indirectly take place in the ocean or use outputs or services from the ocean.1 Put simply, the Seychelles BE Roadmap aims to increase the contribution of such activities to economic growth and social, environmental, and cultural well-being. It attempts to shift the focus from the status quo—in which “oceans have been viewed as a means of free resource extraction” and a dump site for waste disposal—to one in which the ocean’s value is recognized in decision-making and its benefits shared equitably.2
The roadmap is focused on four key pillars: 1) economic diversification and resilience; 2) shared prosperity (creating new jobs and investment opportunities in ocean sectors); 3) food security; and 4) integrity of habitats and ecosystem services, sustainable use, and climate resilience. Through the roadmap, the Seychelles hopes to reduce its economic and environmental vulnerability by increasing the diversity of ocean-related sectors. The roadmap will allow the country to prevent threats to its ocean, such as illegal fishing, marine pollution, and climate change effects. It will also enhance the capacity for effective ocean governance, so that these opportunities can be fully realized, and these threats reduced.
Innovative Financing
Seychelles is leading the way with innovative financing tools for coastal and marine resources, particularly with the World’s first blue bond. The blue bond is an innovative debt-for-nature conversion and was completed in 2016 raising funding to buy $21 million of Seychelles’ sovereign debt to refinance it under more favorable terms, and then direct a portion of repayments to fund climate change adaptation, sustainable fisheries, and marine conservation projects – as well as to create an endowment for the benefit of future generations of Seychellois.
However, implementing such an ambitious roadmap requires a sustainable funding stream. The Seychelles thus took their BE innovation one step further by launching a “sovereign blue bond” in October 2018. According to the World Bank, a blue bond is a debt instrument designed to raise capital to finance marine and ocean-based projects that have positive environmental, economic, and climate benefits. The bond raised 15 million USD from international investors, which will go towards improved governance of fisheries, development of the BE, and expansion of Marine Protected Areas (MPAs, or areas set aside to protect marine ecosystems).
The Seychelles has also pioneered another innovative environmental financing system with The Nature Conservancy (TNC). In February 2018, the Seychelles designated two new MPAs covering a staggering 210,000 square kilometers—an area the size of Great Britain—in a new debt-for-conservation deal designed by TNC. Under the deal, the TNC raised $21 million, allowing Seychelles to pay off its debt, in exchange for a commitment to increase its protected areas from .04% to 30 percent. These first new MPAs include a coral reef and UNESCO World Heritage Site around the islands of the Aldabra group. The area is home to the dugong and the only breeding ground for an endemic species of giant tortoises.
Ports and harbors: Seychelles Port Authority has since 2004 established the Port of Victoria as a respected port in the region.
Oil, gas, and energy: The extractive sector in Seychelles is still nascent, and the social and economic contribution to the sector is minor (less than 1 per cent of GDP, exports and employment). The country does not currently commercially produce oil, gas or minerals, although international companies are exploring for petroleum offshore.
Seychelles has plans for renewable sources to contribute at least 15 per cent to power needs by 2030, mainly using wind and solar energy. Currently, there are eight recently installed windmills generating 6MW of power (about 2.5 per cent of the total demand) on reclaimed coastal land.
Fisheries and Aquaculture: Management regulations were first introduced to control the fishery and processing industry in the Seychelles in 1999. For the last 20 years, Port Victoria has been a prominent tuna transshipment port for purse seiners (foreign and Seychelles-flagged vessels) in the southern and Western Indian Ocean region. Seychelles vision for fisheries sector, as outlined in the National Strategy 2017, is to expand this industry to bring in more wealth for economic growth.
The fishery sector in Seychelles has three main components, namely the artisanal fishery, semi-industrial fishery and industrial fisheries. The industrial component of the Seychelles fishing sector is made up of the foreign owned purse seiners and industrial distant waters long-liners with license to operate in the Seychelles EEZ3.
Coastal Tourism: Seychelles’ iconic beaches are of pivotal importance for this sector, which accounts for 66 percent of Seychelles’ gross domestic product (GDP), according to the World Travel and Tourism Council. Tourism has immense potential to enhance socio-economic development and contribute to environmental rehabilitation. Tourism has been the main driver of growth in Seychelles and is its main employer, accounting for an estimated 22 per cent of formal employment.
1 Sahuque, Raymond. The Blue Economy: Progress on the Development of the Blue Economy in Seychelles. Ministry of Finance, Trade, and the Blue Economy. June 2015. https://wedocs.unep.org/bitstream/handle/20.500.11822/21092/Blue%20Economy_presentation_16%20June%202015_FF.pdf?sequence=1&isAllowed=y
2 Ibid
3 African Development Bank. Seychelles Country Report 2014. African Development Bank Group. 2014. https://www.afdb.org/fileadmin/uploads/afdb/Documents/Generic-Documents/Eastern_Africa%E2%80%99s_Manufacturing_Sector_-_Promoting_Technology__Innovation.pdf