Investment opportunities in Seychelles (Part 2)

Investing in Seychelles offers numerous opportunities for both individuals and large companies. The country’s stable political and economic environment has made it increasingly attractive to investors from all over the world. In addition to its favorable tax policy, the country offers a range of investment opportunities that are unrivaled in the region.

Investment Sectors

Energy

Seychelles aims to increase the share of renewable energy in its energy supply from 5% to 15% by 2030. The 100% Renewable Energy Strategy also aims to achieve full decarbonization of the energy sector by 2050. The Seychelles Energy Efficiency and Renewable Energy Programme (SEEREP), launched in 2014, offers a subsidized loan for investments in renewable energy for small and medium enterprises (SMEs) and households.

The energy sector is expected to grow in the coming years. Such ambitious targets will require not only gradual but also profound changes to the energy system and infrastructure. Seychelles aims to achieve the energy transition to a low-carbon energy sector by introducing large-scale power plants (solar photovoltaic, large-scale offshore wind farms). Today, they play an increasingly important role in the economy of Seychelles.

The overall policy objective of the state is not only to mitigate climate change, but also to strengthen energy security. This is an area that will stimulate local industry, local and foreign investment, and create jobs. Given the small size and limited land, large-scale power plant projects will be implemented on a competitive basis. As opportunities become available, the Seychelles Investment Board (SIB) will publish tenders on its digital platforms.

In addition, Seychelles has a 6 MW wind farm built on two reclaimed islands (Ile Romainville Port and Ile Dou Port). It consists of eight 750 kW turbines that operate at low to medium wind speeds.

With nearly 1.3 million km² of ocean, there is potential for offshore renewable energy. The Seychelles Energy Commission (SEC) acknowledges that such technologies are not yet fully commercialized. The SEC is committed to working with stakeholders to use Seychelles as a test bed for its offshore renewable energy goals. If the technology is economically and technically feasible, the government will consider adopting it.

Investment opportunities for foreign companies:

• Renewable energy (solar energy).
• Supply of photovoltaic equipment.
• Supply of electrical equipment (renewable energy).
• Plant recycling.
• Energy efficiency technologies (smart systems for domestic/commercial use).

Infrastructure

Being a nation of 115 small islands certainly has its advantages, including distinct and unique ecosystems, as well as vast stretches of coastline and ocean resources. But it also poses challenges, especially in terms of land and infrastructure. That’s why Seychelles is coming up with innovative solutions to make the most of the space it has, while respecting the environment and anticipating climate change.

A key part of the strategic infrastructure expansion is the planned development of Victoria Port and a series of tunnels on Mahe to prevent increased trade from causing even more congestion. The smart approach uses the same tunnels to improve Seychelles’ public services, and also uses the land for a new dam project, while improving construction standards to cope with cyclones in a less stable climate.

A $41 million expansion plan for Victoria Port, Seychelles’ main port, is at the heart of the islands’ vision. With an international design tender for the project set to take place this year, the first phase will involve the construction of a 600-metre-long quay, while the second phase will deepen the approach channel and turning basin to minus 15 metres. An artificial island will be created to provide additional container space as the Port of Victoria seeks to not only meet local requirements but also become an international transhipment hub.

China, already responsible for major projects on the islands, is set to become a key partner in Seychelles’ infrastructure development. The country’s government has stated its desire to switch from oil to liquefied natural gas (LNG), which will also require major infrastructure investments.

The Seychelles are also seeking their own offshore oil production under the auspices of PetroSeychelles. The expansion of the port in Victoria will allow the country to become a fuel distribution hub for the region.

Tourism

The Seychelles Vision 2033 aims to strengthen the tourism sector by managing environmental impacts and supporting the implementation of sustainable practices in business operations, as well as diversification beyond the traditional ‘sand, sea and sun’ offerings.

Since the opening of the Seychelles International Airport in 1971, the tourism sector has become central to the country’s economy. The natural beauty of the 115 islands, as well as the unique Creole culture, have not only attracted growing numbers of visitors, but have also made the islands a magnet for regional and international companies looking to invest in the sector.

The Seychelles is expanding its appeal by harnessing nature to develop ecotourism and offering a growing range of activities from reef diving to golf. Eden Island is an example of diversification, the country’s first marina project with 580 luxury residential units built on reclaimed land from Mahe Island, representing 20% of all foreign direct investment in Seychelles.

Europe remains Seychelles’ main tourist market, with the largest number of visitors coming from Germany, France and Italy.

Today, visitors have a wide range of accommodation options on the islands. These range from world-famous hotel chains such as Hilton, Kempinski, Marriott, Savoy, Banyan Tree and Four Seasons to smaller hotels, guest houses, self-catering establishments and villas. In addition, the inner islands scattered around the main island of Mahe provide a safe and tranquil haven within the reef for yachts and schooners, as well as accommodation for visitors.

As Seychelles also encourages private sector investment, medical tourism is a promising area for investment. The tropical climate and stunning natural beauty of the Seychelles have allowed the country to position itself as a medical tourism destination in Africa.

Sustainable tourism development represents a unique and strategic competitive advantage for Seychelles as a tourism destination.

Education

The Government of Seychelles prides itself on providing quality education to the population from pre-school to university level, which has enabled the country to rank first in Africa in the Human Development Index.

The University of Seychelles is steadily building its reputation as one of the fastest growing knowledge hubs in the Indian Ocean. In partnership with highly accredited international institutions, its programmes have provided opportunities for both local and international students.

As an attractive investment destination, the population needs to be properly skilled. This will require educational institutions and specialist training centres to support demand.

Agriculture

Innovative and modern farming techniques such as hydroponics and vertical farming are encouraged to maximise the use of land in the country. Seychelles is moving towards increasing national raw food production and increasing the visibility of the sector to attract more investment. The agricultural sector is expected to produce 50% of what the local market consumes in the coming years. To achieve this, a proper human capital base, research and development are required. The government is keen to empower the private sector to drive economic growth and diversification.

Technology and Communication

The Government of Seychelles has placed the digital economy sector among its priorities. This includes digitizing public services in the country, turning it into a FinTech hub, and building online payments and cybersecurity capabilities. The private sector is included through software outsourcing and IT services, with 90% of the services developed in-house by the Department of ICT (DICT).

The information and communications technology sector offers foreign companies a number of opportunities to expand into high-value technology services. According to data, Seychelles ranks third in Africa with 73% internet penetration. Up to 97% of the Seychelles population has access to 4G (LTE) mobile network coverage.

Blue Economy

Seychelles is a global biodiversity hotspot made up of 115 islands in the Indian Ocean. As an island nation that relies almost entirely on its ocean, it has become a shining example of a country that has embraced the Blue Economy.

Sustainability is critical to the success of the Blue Economy concept and this has multi-sectoral implications. To better coordinate the Blue Economy approach, the Blue Economy Department was established in 2015 to promote the sustainable use of marine resources and also coordinate its approach to the use of the Exclusive Economic Zone (EEZ). Any business activity in the EEZ will be developed in accordance with the Seychelles Marine Spatial Plan and will need to reflect the sustainable use of marine resources.

Seychelles has developed a Blue Economy Roadmap that sets out how Seychelles will make the most of its nearly 1.3 million km2 of ocean in the most sustainable manner. This comprehensive roadmap covers the full range of potential resources:

• Oil exploration
• Aquaculture
• Sustainable fisheries

Prospects for Russian companies

The Government of the Republic of Seychelles (RSO) is interested in cooperation with Russia in the following areas.

1. In the energy sector:

• application of Russian developments in the field of using renewable energy sources (wind and solar energy);
• assembly of panels in the Republic of North Ossetia for the use of solar batteries from Russia;
• exploration of oil fields in the exclusive economic zone of the Republic of North Ossetia;
• purchases of Russian oil products for the electric power industry and transport;
• import of energy-saving equipment from Russia;
• purchase of electric generators with a capacity of 6,500 kW.

2. In the field of fisheries and fish processing:

• creation of fish processing enterprises with the participation of Russian investors and its export to Russia and other countries;
• sale of licenses for fishing by Russian vessels in the exclusive economic zone of the Republic of North Ossetia;
• creation and attraction of Russian investors for the creation of an enterprise (farm) for breeding snapper (reef grouper) and the use of Russian experience for these purposes;
• technical assistance to Russia and exchange of experience in the rational use of fish resources;
• export of canned tuna to Russia within the framework of the general system of preferences applied in Russia;
• purchase of metal products (containers) in Russia for the production of canned fish.

3. In the sphere of infrastructure development:

• expansion of the main seaport in Victoria (construction of a berth and other port facilities);
• development of infrastructure of the international airport of Victoria;
• construction of bridges between the islands.

4. In the sphere of agriculture:

• assistance in development of the agro-industrial complex;
• joint organization of supplies of agricultural products for Seychelles hotels and restaurants;
• growing vegetables without soil on nutrient solutions (hydroponics).