Seychelles economic growth hurt by piracy: minister

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Pirates operating in the Indian Ocean are hurting the economy of the Seychelles, putting the archipelago’s livelihood at stake, said the transport minister of the Indian Ocean island nation.

Best known as a luxury destination for holidaymakers, the country of 85 000 expects strong economic growth this year, recovering from 2008 when foreign exchange reserves were nearly exhausted.
“Piracy has hampered the economic growth of the Seychelles through the loss of income from economic activities such as maritime tourism, fisheries, and trade in and out of the Seychelles,” Minister for Home Affairs, Environment and Transport Joel Morgan told Reuters.

Pirates from Somalia are hijacking vessels off of Seychelles’ coast in recent years, forcing the country to seek maritime assistance from other countries.
“The pirates pose an extremely serious threat to the Seychelles, both from the national security point of view, and to our economy. We depend heavily on the sea and its resources for our economic activities,” Morgan said at a conference on piracy held in Dubai.

Seychelles’ push for economic reforms was triggered by an acute balance of payments crisis in late 2008 that forced Seychelles’ to default on a eurobond interest payment and turn to the IMF for a rescue package.

The country’s economic growth is now expected be at 5 percent by 2013, but vigilance was needed against inflationary and exchange rate risks, the International Monetary Fund said in January.

Somali pirates seized a German ship and its 12 crew off the Seychelles in January.

A report this year said piracy worldwide was costing the global economy $7-12 billion a year, with Somali sea-bandits in particular driving up the cost of shipping in the Indian Ocean.
“The Seychelles believes that we need to tackle the financing of piracy heavily, and cut off the head of that monster that is the criminal activity of piracy,” Morgan said.
“By removing the people that finance piracy wherever they are and bring them to justice. They are in the countries within the region, but also elsewhere in countries in the West.”



On Monday, Seychelles also signed a repatriation agreement with Somalia’s enclave of Puntland on the transfer of convicted pirates back to Somalia.