Tourism boosts forex supply and reserves in Seychelles, exchange rates stable

Abel said that the supply of foreign exchange from the tourism sector has increased compared to the beginning of the year. (Joe Laurence, Seychelles News Agency)

The progress being made in the tourism sector is helping Seychelles increase its revenue to sustain its economy, the governor of the Central Bank said on Wednesday.

Carol Abel told a press conference that the supply of foreign exchange from the tourism sector has increased compared to the beginning of the year.

The supply from the sector for March was $48.6 million compared to 46.4 million in February. The figure is over $40 million more than what was received in March 2021.

"The results show that the tourism sector is the important key that is giving us this result. With the increase in supply in general, we have accumulated more foreign exchange in the system and this is helping to keep the exchange rate stable," said Abel.

As a result, the rupee of Seychelles, an archipelago in the western Indian Ocean, has appreciated versus the dollar and the euro.  

The results for Tuesday showed that the dollar on average was SCR14.20 and the euro was SCR15.03. This is 11 cents cheaper for the dollar and 37 cents for the euro compared to Tuesday of last week.

"For our reserve, last Friday, we had $680 million dollars and $516 million that the economy can use," she added.  

Inflation increases by 8.26 percent for 12-month average

Abel also talked about the increase in the inflation rate that is the current subject globally.  

For the month-on-month figure, it increased by 0.09 percent and for the year-on-year it has increased by 2.22 percent. For the 12-month average, inflation has increased by 8.26 percent.

"The component that has helped to increase the rate of inflation is the global impact as we depend a lot on importation. The changes in the food and oil prices happening in the world directly affects us," said Abel.

The CBS governor is appealing for a shift in individual and collective behaviour now that the world, including Seychelles, is facing an increase in inflation.

"We need to take into account the grave uncertainties the world is facing, one of them which is the conflict in Ukraine, which is something the whole world is trying to adjust to. The COVID pandemic, which dealt huge blows to the world economy at its onset two years ago, is still another factor that we must keep in mind is still around," she added.

She warned that "we must remain disciplined as a country if we want to weather the troubles we are facing right now."