Minister Pierre Laporte Defends Disaster Budget

Minister Pierre Laporte went on SBC on December 26^th, 2014, the day after Christmas, to defend aggressively without remorse his Budget 2015 – Disaster program for the Seychelles economy.

James Michel Said Dialogue

While James Michel has told his minister to engage in dialogue with the people, Minister Laporte did the opposite, attacking the Seychelles Hospitality Tourism Association (SHTA) led by Mr. Freddy Karkaria, attacking the Seychelles Chamber of Commerce (SCCI), led by Mr. Marco Francis.

Cross Sector Meetings

The two business associations represent 98% of all business interests in Seychelles. They have collectively been in dialogue with the Vice President Mr. Danny Faure in Cross Sector Meetings since July, 2014, to address the serious economic downturn, and back fire of the Tourism and Fisheries sectors in 2014.

At one point, the situation had become so tense and unbelievable, by Mr. Laporte, that the Minister of Tourism, Mr. Alain St. Ange flew down French Tour Operators to allow them to express themselves on the reality of doing business with the Seychelles market from Paris. Paramount was the lack of Direct Flights from the once lucrative Paris market, followed by the high cost of the destination, and crime against visitors.

It would appear Minister Laporte has dismissed these discussions as mere wind blowing by our crucial partners who have been with Seychelles for 35 years of Tourism. Minister Laporte may not have to worry about these partners in 2015, they are leaving us daily. To bring them back to sell Seychelles, after this dastardly budget for 2015, will be harder then Seychelles placing a man on the Moon.

“Spitting” in a Tour Operators eye, Minister Laporte, is a dangerous sport, and when you play that sport, you risk the welfare of the national economy and all our gains as a micro state.

The Seychelles In 2014

Minister Laporte admits openly that 2014 was a bad year for Seychelles and the Seychelles Rupee devalued by 14%, because we spent more than we earned as a country. He credits his ministry for reacting fast to tighten the monetary policy, he placed a moratorium on car importation.

It all sounds nice in December, but the truth is we wrote about a severe downturn in January 2014 and it took Ministry of Finance and the Central Bank Six (6) months to react with a devaluation of the rupee to curb Demand.

What Does 14% Depreciation of Rupee Mean?

In practical terms, the 14% depreciation meant that a person earning Scr. 100,000.00 per month as Minister Laporte, lost purchasing power of Scr. 14,000.00 in 2014.

This means Scr. 14,000.00 disappeared even from his own pocket under his own Budget and strategy, alone.

A person earning Scr. 5,600.00 per month, lost Scr. 784.00 from their purse each month, and they paid another Scr. 840.00 in VAT on all the items they purchased, if they spent all their money each month. After depreciation of the currency under Minister Laporte’s economic strategy for 2014, and his VAT of 15%, a ordinary worker was left with SCR. 3,976.00 in rupees to spend on food, water, electricity, clothing, toilet & sanitary items. Based on the value of the Seychelles Rupee prior to Mr. Laporte coming back to Seychelles from the IMF in Niger, this money was worth Scr. 1,988.00 under the Rene government, when James Michel was the Minister of Finance.

In spite of this stark and alarming reality that shows, the Seychelles Rupee is devaluing each year, our receivables are low, our expenditures are too high, Minister Pierre Laporte tells us to “stay on the Road (course) of sustainability” as if he is Ronald Reagan speaking to America.

2015 Another Difficult Year He Says       

The Minister admits that 2015 will not be easy. In the same breathe he says, “it will not be more difficult”. Does this mean the Minister has projected another 15% depreciation of the Seychelles Rupee for all of Seychelles? Very likely.

In 2015, if we stay the course to sustainability according to Minister Pierre Laporte, from his limited perspective, of office desk nursing, we will see another 15% depreciation of the Seychelles Rupee, expenditures will exceed revenue, and the snow ball of destruction will well be on its way, and we will see the SCR 5,000,000,000.00 note being used to buy bread. Fantastic is it not? Well, it is Pierre Laporte who has told us to stay the course, and we have seen what his course has done to Seychelles in 2013, 2014. What makes you think 2015 will be any different? It will not. But by end of 2015, the obvious will be in place: everyone will see the destruction of the policy advocated by Minister Laporte, we may well be at -30% because as a ball rolls down hill, the farther it goes, the faster it goes, the course, becomes irrelevant as velocity overtakes the mass.

2013 GDP Misrepresented on SBC By Minister of Finance

Minister Laporte says in 2013 we had 5% GDP. This is a false statement. We never had 5% GDP since the country underwent IMF Administration. Why would a Minister misled simple reporters from SBC searching for answers to a complex question? What is the agenda?

Minister says: “2015 Very Good Budget”

If the Budget is so good Minister Laporte, why are hotels empty from  January- April?

The Budget is as good as the Budget of 2014, which Linda Rosalie correctly pointed out, we were promised a pick up from mid year by Minister Laporte and it never happen. It never happen because Minister Laporte never did anything to pick up the revenues. He never amended any policy that would encourage more fish in the nets, or more tourist to come to our shores. If anything, he discouraged Tourists from coming to our shores when he irrevocably pulled SCR. 6 Million in funds from Seychelles Tourism Board funds to shore up other consuming ministries. By the end of the year, STB had hardly any money to market, and Minister Joel Morgan was sending a DVD to Etihad, begging Etihad to play the DVD on its international flights to promote Seychelles.

Revenue Based On Consumption tax Not Inbound Market

Minister Laporte correctly says he is concern that most revenue comes from Consumption Taxes. This is a valid concern. But it highlights the nation’s failure as well. If we have to rely on tax from Seybrew to run the government, we have a problem. It also honestly explains the hike in taxes on other alcohol. It is an attempt to increase revenue for Seybrew. Minister Laporte can do better then that.

“No Business Tax Collected”- The Man Says

The Minister of Finance says he has not collected $1 Million in Business Tax returns. Hard to believe, but we get the point. Business Tax is 25% on profits. If a business makes no profit, it pays no business tax. Simple. Basically, Minister Laporte is telling us that businesses in Seychelles do not make money. He is right 100%. They do not make any money in profit.

·        When they make a little money, they buy a car, pay 250% tax on the vehicle. What profit do you expect?

·        When a rich investor comes to Seychelles, he sets up offshore companies and accounts, your government allows them to operate onshore. IOT is a perfect example. There are thousands.

·        The home owners on Eden Island set up offshore companies, operate onshore, send their money overseas, and yes, they screw the government. What does the government do about it? Nothing. They accept it because they also sell passports to these homeowners. You cannot hold them accountable, because if you do, they will come to me and tell me they did buy a passport, and they will name and shame all of you in the deal.

·        Yacht operators anchor multi million Dollar yachts in Seychelles, what do you collect from that?

·        Bareboat charters operate 1200 licenses in Seychelles, each boa has 6-15 beds. They are like a floating Beau Vallon Bay with 6000 plus beds. What do you collect on these beds? Bare boat-barely anything. Why?

Transfer Pricing

 Minister of Finance complains about Transfer Pricing of large hotels. He moans on and on about this. I have heard this moan now for Five (5) years. Consul of Ministers, if there is a God, ask Minister Pierre Laporte what has he done in Five (5) years on Transfer Pricing? Ask him why the Ministry of Finance has not been able to solve this problem, but it complains about it every year.

We cannot fill the Ministry of Finance with homosexual gangs frolicking about looking for the next boyfriend on the Public’s expense and expect serious results.

Fill it with business people, create a system of greater accountability and you will get results. Ministry of Finance needs to become accountable to the business community, not the other way around, in Seychelles.

Something For Business

Finally, Minister Laporte says there is something for business in this Budget: deferment on VAT for construction.

Who in their right mind will use that in a economy that has a currency falling 15% per year, if we stay on the course of sustainability as the Minister suggest?

Only VIJAY!

Minister says “Where Do I get Money To Run The Country?”

People of Seychelles, when a Minister of Finance, tasked with getting money to run a country ask this non starter question, we are in trouble.

In spite of that, let me help you Minister Laporte:

Top Priority

1.     Create a Budget That encourages growth, this means keep Seychelles competitive, do not ignore the fact that each night sold on a room or boat, must be sold with a sales pitch to an agent, or traveler directly.

a.     Today, this is the pitch: “Come to Seychelles, we are 21 hours by flight, the most expensive place in the World, bring extra money to get less, experience our exceptional environment, no different from 500 other islands, our room tax I the highest in the world and twice that of our rival destinations in the Indian Ocean. Our fuel prices are static and do not reflect world market trends even if oil is down 52% and counting.

2.     Go After The Transfer Pricing Companies. Stop crying about now for 5 years and counting.

3.     Make the Bare boat industry pay their fair share or do not renew licenses.

4.     Cancel all penalties on all taxes due from past years during all of 2015. Good performers should be rewarded with lenient penalty fees in 2016, since business will be so bad in 2015, that you will be lucky to collect anything as you proposed in this gay Budget-2015.

5.     CSR should not be on gross. Stop stealing to make your life easy. Encourage companies that are making a profit to contribute to socially responsible projects in the community by offering 200% tax deduction on the donation. Stop scamming the Business community and the money is wasted on Christmas decorations, fake NGOs formed by PL to use up the money on trips, airline tickets, meal allowances, clothing allowances and so on.

6.     VAT is not sustainable at 15%, nor is the government sustainable at 5% VAT as you suggest. Reduce VAT gradually, correlating it to improved compliance, improve reduction in Price Transferring, Compliance in bare boat industry etc…. The for this rest with Ministry of Finance, not the Business community. The puffs at Finance are not doing their job, now you blame it on the ordinary people of Seychelles and make business, hotel investors and operators suffer.

7.     VAT on rooms must be reduced to allow us to sales pitch the room and the destination or we are dead. Simple. Immediately, reduce room tax to 10%. Once compliance improves, revenue will improve, and you will be able to take it down to 7% in subsequent year 2016, if you do your work.

8.     VAT on goods needs to be reduced to 10% to allow the people to breathe. Seychellois are suffering, and many of our people lack the skills to move forward in employment. Night Schools need to be started using existing infrastructure. The eye to liberating economically our people rest in Education, not Indoctrination.

9.      Give STB the money they need to push the destination. 81Million is not enough since you took Scr. 6 Million last year , and depreciation took SCR 10 Million. As your national financial program fails, you fail everyone, even those on the front line who are trying hard to sell a bad product.

10.                                                                                                                                    Throwing money at a bad product is a little like injecting heroin into your veins. It may take some time, but eventually, you run out of money, your reputation is in ruins, your  body becomes dysfunctional. This is what you are doing to Seychelles when you make it the most expensive place on earth, and propose a marketing budget for it. You ruin the reputation of all those who promote her, sell her, and service her guests day to day.

Once you have done the above, you will have all the money you want to do whatever you want. Pay your debts, build a bridge financed by GOS not VIJAY.

If you ignore these priorities, you may as well hand VIJAY the keys to State House and the country can be run by Engineers……at least the puffs  will be out at Finance and the People of Seychelles will have a fighting chance out of the realm of lunacy.

May God Bless All Freedom Loving Seychellois!

Merry Christmas All Freedom Loving Seychellois!

The Holiday season is upon the Seychelles once again. The town of Victoria is lighted and decorated with money collected from the Corporate Social Responsibility ( CSR) . The Mayor of Victoria said on the Radio that this money taken from the fund is the obligation of the business community to give back to the " Consumer". I did not know the Consumer was a disadvantaged class.
Last year, 80 Million Rupees was collected for the Fund, and this year,another odd 80 Million Rupees taken from a tax scheme that makes Seychelles more expensive, and Ministry of Finance cannot seem to account for these funds and the efficient use of the funds for " Charity" as intended.
The abuse of the fund is a full time effort by PL operatives. They form non profit groups, organizations to solicit applications to tap into the funds.
Tree planting in Districts, trips for District Administrators, airline tickets, clothing allowances. Meals abroad in fine hotels, the list is endless. The intent of the CSR tax was not to feed and fuel a corrupted political organization.
Scamming The People Again
As the People of Seychelles are advised of incoming tax increases, to fuel the repayment of the bills of this failed regime, People of Seychelles, remember your money is being used to fuel more waste then ever to keep the PL political machine in play.

More Failure More Suffering

As PL breaks it's promises, fails the People of Seychelles in 2015, over and over, again and again, remember, when your pocket is empty, we are all paying the price for PL failure.
The more we suffer, the more they steal your hopes and dreams, steal the hopes and dreams of your children, and in turn bring the People of Seychelles into the realm of piracy, criminality, trickery,and they call their own People criminals, recall how PL came to power: by first committing a crime upon all of us and all our children.

PL Does Not Suffer!

In 2014 we saw the PL facing great failures, from devaluation, to drop in economic performance, high crime, murders, burglaries on the rise. PL had a bad year. By mid year, the government was out of money. Funds approved from Ministry of Tourism SCR. 6 Million for marketing at one point was just taken away from STB. With no Budget, STB resorted to Facebook and I phone to promote Seychelles. St. Ange sent emails around the world asking people to visit Seychelles, in a desperate moment. How can a country run like that?
While receivables were flopping, arrivals down, homeless Europeans were being ask to travel to Seychelles for Sun Sea and Sand to meet numbers but not yields.
In that time, remember it was SFP that exposed the abuse on Diamond Class Tickets to New York, exposed PL on money laundering, Human Trafficking.

Liqueur is Not Courage

As PL increases costs to curb use of the hospital,remember, liqueur is not courage. This will not help Seychelles, what will help us is a serious government, with ideas on how to move forward, not a government that has failed us time and time, over and over, again and again.

The results speak for themselves, we do not have to get political about it.

Don't blame Santa Claus if he did not turn up this year, blame Santa Michel for ruining Seychelles economy all by himself.

Merry Christmas All Freedom Loving. Seychellois!
Our work has just begun!

Seychelles: Democracy Without Freedom(by:Think Africa Press)

With a subservient media and an omniscient executive, free elections alone cannot ensure responsible government.

Victoria, Mahe, Seychelles:

The islands of the Seychelles, scattered across the Indian Ocean to the north of Madagascar, are better known for their beauty than for their political culture. But beneath the surface a political battle is raging.

Elections for the presidency of the Seychelles will be held from May 19 - 21, 2011. A Commonwealth Expert Team has been sent to observe the poll. The opposition leader, Wavel Ramkalawan, told Think Africa Press that the Seychellois people are “ready for democracy” – a strange phrase to use in a country that has officially been a multi-party democracy since 1993 and whose last presidential election, in 2006, was called “credible” by the UN’s team of experts, albeit qualified with suggestions of further improvements. The Seychelles came second out of all African countries in the 2010 Imbrahim Index assessing good governance. The public is clearly passionate about politics. However, democracy requires more than political passion and the ability to vote. The most striking characteristic of the lead up to this presidential election is fear.

The current government has been in power since a military coup in the mid-70s overthrew then president, Sir James Mancham. In 1993 a new constitution was written forming the current multi-party system. James Michel is the second president under this system, and the second leader of the SPPF (Seychelles Peoples Progressive Front), now the Parti Lepep – succeeding Albert René in 2004.

In 18 years of multi-party democracy there has never been a change of government. This in itself raises questions about the depth of Seychellois democracy. There are more worrying signs: Think Africa Press has seen written evidence of a voter being bribed by the ruling party and of activists for the opposition party being arrested by the police in breach of procedural rules. The state has firm control over the nation’s one television station, as well as the main daily newspaper, Nation, which on April 16 featured six pictures of the current president in its first two pages. These various factors seem to contradict even the qualified UN declaration of credibility and the international image of the Seychelles as a beacon of democracy.

The continued success of the ruling party is not in itself an indictment of Seychellois democracy. There is considerable support for the SPPF/Parti Lepep, and good reason for the support as well. The Seychelles boasts free universal healthcare, and if a citizen can not be treated on the islands they are flown to another hospital in another country to be treated, care of the state. There is also a pension system which, while not amounting to complete support (providing 2,200 rupees - about $183 - per month), still provides the poorest a safety net. But there have been a number of presidential elections, and these have all been won by the same party with a reasonably small majority – the last was 46% to 54%. It is surprising, therefore, that the results have never gone the way of the opposition party. However, in a small majority political opposition stands out more starkly. It’s a small crowd to lose yourself in.

The fear of a watching and knowing state is compounded by individual cases of intimidation and bribery. Think Africa Press has seen evidence that two members of the opposition party, the SNP(Seychelles National Party), were arrested in March for harassment while campaigning. Not only were the activists dealt with by the Officer Commanding the Criminal Investigation Division of the Force, Superintendent Cecile, rather than the local police, as normal procedure would dictate, but the Superintendent also refused to tell the accused who had made the allegations, or any of the specifics of the claim of harassment. Both activists were warned by an intimidating national figure not to do something vague and undefined to unidentified people and then released. This clearly does little to avert fears of a 'big brother' state.

Added to intimidation are allegations of bribery. There are many rumours of bribery, and on both sides. However, Think Africa Press has specific evidence of a letter sent to a construction company with the heading “Presidential Election Campaign Sponsorship”, asking the company in question to send a considerable supply of building materials to an individual. It should be noted that building supplies are the usual way, according to hearsay, of bribing would-be supporters.

Allegations of corruption are not limited to James Michel’s party. But it seems clear that the party in government has the greatest opportunity to play on the fear of the electorate. Not only is the party in power far richer than the opposition, it also runs a public service system which stretches deep into Seychellois society providing employment to many people. People in these public jobs fear losing their positions or being refused promotion if they vote against the incumbent government. Moreover, the government has the ability to organise large-scale events functioning as self-promotion tools paid for with public money. An example of this can be seen in the recent Seychelles 2020 EXPO which marketed itself with the following description: “The Seychelles 2020 EXPO has been created to enlighten the Seychellois people, visitors, investors and the world at large on how the present work-in-progress AND planned and visionary activities will benefit them in the years to come.” It is evident from this description that the event was effectively a presentation of James Michel’s manifesto for the coming years, lavishly laid on and paid for with national funds.

The influence of the government is also increased by its dominance of the media. The only television channel is run by the state. Although officially SBC is an independent organisation, this is not evident in practice. It does not seem independent, for example, to run an hour-long documentary celebrating the seven years in power of the incumbent leader in the run-up to the presidential elections. There are similar issues with the national radio station. In his 2006 election manifesto Michel promised to “encourage national and private media practitioners to play an active and responsible role in our democracy”. However, in the same year legislation was submitted to the National Assembly by Michel’s government which made it more difficult for independent organisations to set up radio stations. A peaceful attempt to get a petition against this legislation signed was met by resistance from heavily armed paramilitary police which landed opposition leader, Wavel Ramkalawan, and then-editor of the opposition newspaper Regar, Jean Francois Ferrari, in hospital with head injuries and broken ribs. The government seems intent on maintaining an iron grip on its media dominance.

(Centre-page spread from Seychelles Weekend, Nation on Saturday April 16, 2011)

This media dominance has several effects. The symbolic presence of Michel is huge in comparison to that of Ramkalawan. The six pictures of Michel in the first two pages of the national newspaper, alongside a centrefold spread launching his new book (see above), is typical. There were no pictures, and there was no mention, of Ramkalawan. But beyond the strong media presence of Michel, and the dearth of communication available to the opposition, the dominance of the media also denies the possibility of debate to the electorate – a fundamental requirement for democracy. If both points of view are not visible, no effective choice can be made.

This weakening of democracy does not arise from corruption, but is fixed in place by an institutional framework. Similarly there is a lack of transparency in campaign financing because the source of funds need not be declared, and the president can imprison voters thereby preventing them from voting (see Elections Act 1996 Part II 1.(1)(b)). This law may shortly be ruled unconstitutional in an ongoing case in the Seychelles Constitutional Court, although theconstitution itself is a notoriously difficult document to get hold of.

The people of the Seychelles are passionately political. Until recently there were many demonstrations and rallies testifying to their engagement in political society and their willingness to stand up to those in power, as recorded in Seychelles: the Cry of a People by Alain St. Ange. Unfortunately the government no longer tolerates such demonstrations because, as one citizen told Think Africa Press, “they would be bad for tourism”. Recent peaceful attempts, like the 2006 petition signing and demonstrations against water pollution resulting from the building of President of the UAE, Sheikh Khalifa’s new palace, have been met by armed police.

These factors – allegations of intimidation, bribery, the apparent omniscience of the government effected by its media dominance compared to a seemingly powerless and invisible opposition, the lack of tolerance for demonstrations and dissent which are met by aggression and violence – have a deep impact. Individual instances such as a single arrest, bribery, television show, can be shrugged off and the system as a whole called “credible”, as was done by the UN experts. But this is a mistake. It is easy to see that, particularly in a small community, the cumulative effect of all of these various factors make a claim of democratic legitimacy difficult to sustain. For a democracy to function the citizens have to be able to make a free choice when they vote. If they are terrified this freedom is impaired.

Are Seychellois people scared? Well, almost every citizen refused to talk to Think Africa Press once the election was mentioned, although they were open about other aspects of society. Even the Electoral Commissioner, Hendrick Gappy, refused to speak to us. Wavel Ramkalawan, leader of the SNP, told Think Africa Press that “people should not fear politics” – a noble sentiment, but one which hinted at the problems which lie behind his earlier statement, “the Seychelles is ready for democracy”. The citizens may be ready, but James Michel is not.

written by: Ben Carson  http://thinkafricapress.com/seychelles/seychelles-democracy-without-freedom

Seychelles Hospitality and Tourism Association (SHTA) Statement on the 2015 Budget

Seychelles Hospitality and Tourism Association

Friday 19th December 2014


We must express, on behalf of our members, our overall disappointment with the 2015 Budget
which fails to deliver on the fiscal measures necessary to oxygenate the tourism sector.
We have spent an inordinate amount of time over the last six months in discussion with
government. The motor of the economy is faltering, we asked for oxygen through fiscal respite.
Our request was not irresponsible or extravagant. The figures speak for themselves. A 5 percent
decline in tourism earnings, the 14 percent decline in fisheries confirms that Seychelles is too
expensive, unproductive, and a hard sell with high rates, high fuel bills, high VAT.
The government’s response has been to slam a struggling private sector with more taxes, which
will drive up costs even higher and make it even more difficult to do business in Seychelles. It does
not reflect the spirit of collaboration with which we as the private sector engaged with the
government in at the four Cross Sectorial Ministerial Meetings and in the various technical working
groups. These much publicised Public Private Sector meetings promised much at the outset but
delivered nothing in the end. As the SHTA, we feel that the Government has failed the Nation at
this critical moment.
The 2015 Budget is lacking in substance, it contains no stimulus to encourage growth of businesses
or for the private sector to reinvest to ensure the continuity of their businesses. It glosses over the
poor performance of 2014 and promotes business as usual as an ever shaky base crumbles from
inside. For our industry in particular it contains nothing material to ease the operational and
systemic challenges faced by our distressed operators. With over capacity of bed stock, reduced
earnings and low occupancy levels, severe international competition, an intra-country price war,
lack of access from our high yield source markets, the government has opted to disregard and
ignore the plight of an industry in trouble and the existing operators of 12,000 bed stock and other
tourism related operators.
Contrary to the Minister, we must express caution ahead due to disappointing forward bookings
and signs of early discounting for the early part of 2015. Due to overcapacity, we expect the intracountry
price war to continue, thus driving rates further down. The opening of the Bel Ombre
hotel and re-opening of Avani Seychelles Barbarons Resort & Spa will exacerbate the trend. With
escalating costs the new taxes will entail, those businesses who are able to will have no option but
to cut down on quality and standards just to keep afloat. This budget will make our industry even more uncompetitive and risks rendering it ultimately irrelevant

Seychelles Budget Disaster For 2015

Minister of Finance Mr. Pierre Laporte turned up to the National Assembly in his long sleeve purple shirt, reserved usually for funerals one week late, but with a budgetary mixology of disaster all the same, much like the 2014 Budget , the 2013 Budget, and the 2012 Budget. Under his leadership, the Ministry of Finance is on a one way track with blinders in place, in a multi facet ever changing and complicated World. He may just be leading us to a disaster-ous result.

Albert Einstein Said Something About This Budget

Albert Einstein the World’s greatest scientist ever (E=MC2-basis formula for the H-Bomb), is credited with saying: “Madness is doing the same thing over and over and expecting a different result”.

Each year Mr. Laporte submits a Budget with added taxes and each year, Seychelles under performs, and our people suffer, our business community suffers. Each year we get poorer and poorer. Each year, our Seychelles Rupee, devalues more and more at the official indicative rates.

The Weaker Seychelles Rupee

Today, the Seychelles Rupee weaker than in the era of Black Market, which Mr. Laporte is credited for ending, but the Black Market has crept back in his Basket of Currencies and Indicative Traders Rate Averages. If it looks like Black Market, it smells like Black Market, acts like a Black Market, it is probably a Black Market.

In spite of his initial success, it seems Mr. Laporte has gone fixated on doing the same thing over and over, expecting a different result.

Each year, Mr. Laporte has increased taxes over and over again and again, expecting that the Seychelles economy will flourish and not implode. Yet year on year, implosion and now collapse is evident everywhere around us. Vehicle owners and future purchasers are feeling robbed by Mr. Laporte.

Failed Politicians Take Advantage of Opportunities Created By Mr. Laporte

Some old time politicians want to take advantage of this situation to gain some credibility. Hand over your Fat Cat salary-pension (scr. 60,000.00) which is part of the SCR. 1.5 Billion in salaries, if you want us to take your seriously, Kalawan.

Tourism on The Edge Facing Failure

As higher taxes destroys the Tourism Economy in 2015, remember well the words of Chairman Emeritus SHTA Mr. Louis D’offay:” increase of VAT to 15% will kill the Tourism Industry- 2008.

Back To Basics 

Seychelles is not an export economy where we export goods of high infinite demand that the World will pay at any price, and in return money will flow into our economy like magic and we will all be really the richest people in Africa and Europe. In turn we will be able to fund near 800 Million into a failing hospital, pay education ministry to run failing courses and produce failures as pupils. Fund a Police Force where officers are trained for three months and expect crime to be low. Make the cost of living high, salaries low for the majority of ordinary workers, and expect that criminality will not be high, but low.

This is the dream world some officials live in. What makes Seychelles different from Somalia? Nothing, it is just a question of time and degree. We are on our way.

Seychelles Is A Tourism Based Economy

Seychelles is currently a Tourism based economy, wherein we must lure visitors to our shores with a compelling sales pitch every year that is believable and affordable to convince them to get on a plane, sit in an economy seat for 12 hours to come here. Tourism accounts for over 60% of our receivables and near 40% of our total employment of Seychellois Nationals. Tourism employs only 4,800 GOP.

Ministry of Finance Needs A Reality Check

We live in the era of European Recession which will last from 10-15 years ( Germany the engine of growth for Europe will have a GDP of 1.7% in 2015), South African Economic Collapse (ZAR 15.0- Euro 1.0, Gold prices are crashing from $1,700.00 an ounce to $1,100.00 an ounce today may reach $500.00 an ounce if Oil drops to $ 45.00 per barrel), Asian frugality ( we are now looking to the China Market to save us, they pack their noodles for food and they happen to be the most indebted country in the World[256% Debt/GDP Ratio] in other words, we are banking on a TIME BOMB, plus, manufacturing is slowing down at the last quarter, when it should be picking up), Middle East financial crash from the crash in oil prices worldwide( from $116.00 per barrel for sweet crude to $54.00 and still dropping, due to deflation worldwide, lack of Demand, and excess Supply from USA who is now producing on par with Saudi Arabia). The price of oil is expected to drop shortly to $40.00 per barrel, creating a gross imbalance in fiscal commitments by Gulf States and their receivables, which will cause them to tap into reserves to survive the crash. Any country tapping into reserves to meet Budget fiscal requirements will curb travelling, and curb super yachts, curb donations, particularly to micro states that eat pork, bacon, and boudin for Christmas.

High Fuel Prices

In Seychelles the price of fuel remain high at Scr. 21.00 per litre. No reduction. No reality check, as our competitors drop fuel prices to correlate with the reality of the new order.

Mauritius Quickly Drops Fuel Prices

This week, Mauritius whose prices were on par with Seychelles in fuel, 22.00 per litre, reduced its cost per litre to Scr. 15.00 and further drops are on the way.

The Grand National Deception

This single national deception is tantamount to discovering a cure for all Cancer and keeping it to yourself. This is what the Minister of Finance and SEPEC is doing on the issue of fuel prices.

 The price of oil has crashed on the World market, and SEPEC and Ministry of Finance keep the price of fuel in Seychelles high, thinking it will mean more easy money for their Budget needs at the expense of allowing a more affordable cost of living for ordinary Seychellois and better value for money for our Visitors to our shores.

There Is No Such Thing As “Easy Money” Mr. Laporte

This cunning and short sighted strategy can work only for 60 days. Soon Mr. Laporte will learn that the Tour Operators (remember those French Operators whisked to Seychelles for the mother of all meetings with Five (5) Ministers- they are waiting for results) who legitimately complain about VAT, high excursion fees, high taxis fees, will simply stop selling Seychelles, and our receivables will not be -20% like in 2014, or -10% like in 2013, but rather, -35% in 2015 and yes, perhaps worse.

Air Seychelles Will Suffer, Suffer, Suffer

Air Seychelles needs to prepare itself for the 25% load Factor hell on the Charles De Gaulle-Mahe route on each flight, credit to Mr. Laporte’s ministry not rising to the occasion to give us a Budget responsive to reality and not his government’s wish list.

Do Not Piss Off Your Cash Flow Mr. Laporte

The  World is not creating new Tourism partners, except for now, New Free Cuba, who is now a main competitor and emerging market, that will yes, suck us dry even more, along with Madagascar( saw more French Tourist in one Restaurant then in all of Praslin two months ago) , La Reunion ( one flight every half hour), Mauritius (Airbus 380 twice daily plus 30 Emirates A-340-400 flights per week) , Maldives( a little bunch of rocks making a lot of noise) , and probably, St. Marie ( off Diego Saurez, that is becoming a Tourism Market in itself) where the bones of the first Seychellois rest in a pirate cemetery and Humpback whales that visit the region yearly. Four Star hotels go for $120.00 per night per couple inclusive. At nnperson per night.

South African Market In Cardiac Arrest

The South African market was already in cardiac arrest before Mr. Laporte presented the 2015 Budget. The 2014 and 2013 Budget was enough dosage to kill this market. Ministry of Finance cannot blame the drop of this market on David Germain, who is doing an excellent job with near no Budget for marketing. The problem rest with us in Seychelles: (repeat twice) “We Are Too Expensive For South African Market”.

By mid 2015, with the increase in levy of 20% on alcohol, increase in total VAT on a tot, added cost to carry the 20% on hotels, and a tot roaring at Scr. 150.00 a glass, the South African market will be dead.

Poor Air Seychelles Takes It in The Pants Again

As the South African market dies, poor Air Seychelles, the prodigal Son of Seychelles, will take it in the pants, with empty seats most of the year from Jo’ Burg. Load factors will crash, Air Seychelles will come running to Mr. Laporte for another $10 Million to keep flying. Eden Island will panic because no connecting flights to Jo’Burg and their sales, re-sales will crash. Does Ministry of Finance start to get the picture?

By mid year, will it all have been worth it to play with tax on a little rum? Afterall, no government in the World has ever been able to legislate morality or cronic disease like alcoholism. A drunk will drink until he decides he wants to change. Taxes do not change the pattern, they just resort to cheaper drinks, and in the meantime, the children that rely on them suffer, then they fall back on Mr. Laporte’s laps at the Social Security office, asking for support. Is the picture getting clearer now? 

Economic Sustainability Comes From Growth Not Taxes

Listening carefully to Mr. Laporte, I get the impression that he equates “Economic Sustainability” with collection of taxes. In University we were lectured in Economics 101 and even Finance 101, that: “economic sustainability rests squarely on creation of economic growth/wealth”. In turn, the government levies on the wealth through taxes. Without economic activity, there cannot be any taxes paid on time, or paid at all ( Greece Syndrome).

Where is The Beef?

Supporting the social programs of free medical ( in spite of proper AUDITS of Scr. 780 Million) , free education( in spite of 32% single course pass rate or total failure) , policing ( in spite of it being a total joke by now) , road maintenance( where?)  , subsidies of $ 5 Million and $ 10 Million to Air Seychelles, owned by Etihad, in spite of saying, it will never be done again, can only come from: 1. economic growth and 2. begging. Begging is getting harder and harder, so naturally, the focus needs to be on economic growth.

This means at the very least, do not mess with what is producing revenue for the country: Tourism. At the very least, try to help it, where you have hurt it, with over taxing ( VAT 15% on a room, when our competitors charge only VAT 7% at most), making fuel prices reflect its true price (SCR. 14.00 per litre, to give each operator from Taxi Driver, to Boat Charter, Game Fishing operation a fair chance to participate in the economy).

Put simply, unless Mr. Pierre Laporte amends his room tax and Food and Beverage Taxes, in 2015 adjust fuel prices to reflect reality, Tourism will implode for Seychelles, and it will not come back ever again, in our life time, as we knew it to be once upon a time.

The Blue Economy- Fish

The Blue economy means Fish! It does not mean oil. Mr. Pierre Laporte is guilty of misleading the Public into believing that there exist high probability of success for extraction of oil offshore in Seychelles for a profit at today’s international market prices and existing excess supply worldwide.

Offshore Oil- Hic!

Offshore oil exploration is viable only when oil prices internationally exceed $80.00 per barrel. Today ,People of Seychelles, that includes Mr. Laporte and the entire National Assembly of Seychelles, we are looking at the reality of $45.00 per barrel oil. This means if you do some simple math, you will conclude, that offshore exploration in Seychelles is about to shut down, if it has not already, not the other way around.

 Respect has a multiplying effect when we are intellectually honest with our community.

Fish Economy

High PUC Bills Kills Fishing

Fisheries cannot work without cheap access to chiller time to store fish, prepare fish for export. PUC guts Fish companies like Oceana Fisheries, and Sea Harvest to the amount of Scr. 500,000-Scr. 1 Million a month in electricity bills.

This makes the Blue economy just talk. It explains why these companies change hands often.

High Interest Rates Kill Fishing

Additionally, interest rates at banks for boats are too high at 18%. Moreover, we no longer have a viable labor force and foreigners will have to be imported to fish in Seychelles.

EU Has Free Hand For Cents per kilo

In the TUNA sector, PL has allowed the EU to corner the Seychelles into a mea culpa, mea culpa situation, wherein Seychelles receives only Euro 3 Million per annum for an industry that produces over $350 Million and employs 1500 Madagasy and Thai workers. Where are the revenues? There are none, the IOT is an offshore business, on shore, this is PL style.

China Invest In Fisheries In Mozambique

In the meantime, the Mozambique Government and the PRC have rail road the PL government in fisheries and have built a $450 Million fishing port, to fish in our waters, take our fish, and send the talk about the Blue Economy to be confined to conferences. They will convert the blue economy in the region into hard cash, by the hundreds of millions. China will not have trouble finding top USDOLLAR for Seychelles caught fish.

Growth 3%

If staying the course for three (3) years, increasing taxes, has not produced growth beyond 1.8% in any given year, what makes Mr. Laporte think that he can do it in 2015 and achieve 3% when IMF in its most optimistic prediction said growth will be 2%? I don’t know. Maybe Mr. Laporte is courting Russian investors, to do this fancy dance, but as of today, the Ruble Crashed on collapsing oil prices.

Growth rate in Seychelles as it has been in 2013, and 2014 will be minus 2 or minus 3%. Why? Read on.

Where Are The Direct Flights?

It is noteworthy to Mr. Laporte and all Seychellois, that what was making the Tourism Industry work well in 2008 was the 6 direct flights from Paris, and 2 direct flights from Heathrow. This allowed visitors direct access to a holiday fast and this allowed them to maximize their time in the sun.

Once the direct flights were cut, Seychelles Tourism Industry was on a challenge to climb Mount Everest with a dangling rope (called Hub and Spoke) and knickers called Etihad, to cover our *** while Air Seychelles faced Bankruptcy from mismanagement.

Hub and Spook!

The Hub and Spoke regime has never worked for Seychelles. These airlines just cannot coordinate with the Industry to adjust seat availability, ticket cost, with the seasons.

Hub and Spoke regime has produced a hit and miss in revenue for the Tourism Industry. Some months good, other not too good. In between we register losses and Minister Laporte thinks we are stealing money, when in fact we are all going bankrupt.

Start Walking Man Get To Know Your People

 Why does he believe this? He stays in his office or on a plane in first class, and does not come out of hiding to visit with the common man driving this Tourism Industry, which he expects money revenue from each month.

Without direct flights, at affordable fair rates, Seychelles cannot remain busy all year round. In addition, direct flights must have a solid 12 month marketing campaign in place to entice visitors to Seychelles.

While this is in play, the PL must get their act together, lower crime, get serious on Education, stop playing with lives, get serious on the cost of living for Seychellois and Visitors alike. This is how Tourist will come back to Seychelles, and Seychelles will make a fair living off the revenues of Tourism.

Financial Sector- Offshore

Dead!

World Trade Organization Membership

Kills Farmers and not necessary for a micro state.

Deferment Program For Construction

If ever the career of a man was tied to a bad idea, this is it. Who in the world will risk building in a depressed economy, faltering currency, on a defer payment of VAT 15% incurred on goods at the time of building. Most projects take 24 months to complete. This means at the end of 24 months, the investor, after shoveling out millions into  a project will have a hefty VAT bill to pay with penalty if everything is not going so well. Without direct flights to Seychelles, and numerous faltering routes from key markets like South Africa, La Reunion, Madagascar, Tanzania, who on earth will take this risk? Most buildings are due for renovation in 5 years of opening. This is perhaps the most hair brained idea I have ever heard, to be applied seriously in a micro economy that is isolated, and just the shipping time from supply markets is 90 days. Come fellows at Finance, get serious. You are giving your Minister a bad rap.

Taxes, Levies, Excise Tax Anything Nice!

If ever there was an invention that touches people’s heart, cuddles their senses, and captures their imagination for opportunity, ignites their passion for excellence, it is the automobile.

Minister Pierre Laporte decided to tax it more, even though he wants productivity to increase in the country. I just don’t get it.

If you want someone to work hard, give him a fair shot to own a car. Don’t take it away from him.

If you want someone to be creative, give him an opportunity to drive a man made creation. Don’t take it away from him.

All this taxing overnight, has a one party communist taste to it. I do not see the BMW’s and Lovely sedans Ministers drive going on auction.

In my view, nothing offends an average citizen working hard , trying to come up in life, then an unreasonable tax burden and is excessive, and insensitive.

Minister Laporte needs to reconsider this, along with the rest of his “Budget for Disaster”.

The Grinch stole Christmas, I wonder who will steal 2015?

Have a splendid week!

Sesel Pou Seselwa!

May God Bless All Freedom Loving Seychellois!