Africa-Press – Seychelles. The Seychelles economy remains fragile amid rising uncertainty on the international market and as the war in Ukraine continues to impact on the global economy, resulting in the alarming increase in prices of fuel and food products worldwide.
Brian Commettant, head of research and statistics at the Central Bank of Seychelles CBS), gave these details yesterday while presenting the bank’s regular update of the economic situation of the country in the face of the world situation.
Mr Commettant noted that as the global increase in prices of essential commodities continues to impact directly on us as we rely heavily on imports, this is resulting in a drastic reduction of our people’s purchasing power causing many of them to adjust and try to prioritise their expenses where possible to try and cope with their increasingly difficult financial situation.
He said shifts in individual and collective behaviours are critical, and there is a need for more careful discussion and alignment in policy direction to reflect the current economic challenges.
On the local market, meanwhile, he said the demand for foreign exchange for the month of May is much more than it was for the same period in 2020 and 2021.
Statistics show that for the month of May up to now a sum of US $51 million has been exchanged compared to US $30 million for last year and US $23 million for the same period in 2020.
In terms of demand for foreign exchange for this same period, this amounts to a sum of US $58 million compared to US $36 million last year and US $27 million in 2020.
”This means that for the month of May until now the country has spent some US $7.3 million more than it has collected,” Mr Commettant remarked.
He said if statistics for this year until now are taken into account, the amount of foreign currencies exchanged on the market is US $317 million and this is 70% more than for the same period last year.
In terms of exchange rate, Mr Commettant explained that the value of the rupee has remained generally stable compared to the dollar. On Wednesday, a US dollar was being sold for R14.19 which is 0.3% lower than last week which shows a slight appreciation of the rupee compared to the dollar. As for the value of the rupee compared to the euro, on Wednesday a euro was being sold for R15.13 showing a small depreciation of about 2.4% compared to last week.
As to the country’s current reserve, Mr Commettant said statistics for May 24 show that it stands at a sum of US $666 million from which the sum of US $507 million can be accessed for use.
Meanwhile, Mr Commettant said they have observed that the tourism sector has remained positive in terms of the number of visitors that continue to enter the country and the amount of revenue in foreign exchange being generated by the sector.
“For the period January to April this year, the country has received a total of 110,155 visitors compared to only 21,030 visitors for the same period last year and the sector has made a direct contribution of US $184 million to the economy for the first quarter of the year compared to only US $26 million for the same period last year.
Meanwhile, statistics are showing a continued increase in the price of commodities and services on the domestic market. As for the 12-month average inflation rate, this stands at 7.5%.
As for external developments, these are being dominated by the war in Ukraine and its impact on the global economy resulting in the alarming increases in prices of fuel and food products worldwide with a direct impact on prices of food and fuel locally..
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