Business review for 2021 Keeping struggling businesses afloat |31 December 2021
To assist businesses struggling to meet their immediate financial obligations due to the pandemic and resulting economic hardship, the Central Bank of Seychelles (CBS) made several revisions to the Private Sector (MSMEs) Relief Scheme and the Private Sector (Large Enterprises) Relief Scheme in 2021.
In March, the CBS Board approved to extend the access period to the two schemes until the end of December this year. The moratorium currently set at 12 months was extended to a maximum of 18 months, where existing approved applicants automatically received the additional six months moratorium. New applications approved following this revision have been given a 12-month moratorium at the outset; and the additional six months will be granted, if required, after further review by the participating credit-granting institutions that received the application.
Following the National Assembly’s approval of amendments to section 29A of the CBS Act, the tenor which was previously set at three years in 2020, was also increased to eight years, as a maximum. However, clients who have accessed a loan under the two lines of credit until the end of December this year will need to have a conversation with their respective bankers as the 8-year maximum repayment period is not automatic and is considered on a case-by-case basis, based on various factors.
It is to be noted that CBS has made available R500 million for businesses falling in the MSME category and R750 million forlarge enterprisesthrough the two credit line facilities. Based on statistics received from the financial institutions administering the two schemes, as at December 7,2021, out of 454 requests received from MSMEs, a total of 295 have been approved for a total sum of R131,315,276.18(26.26% of the R500 millionmade available). The highest number of approved applications arefrom businesses in the following sectors: tourism (79), trade (65) and transport (52).The remaining approved applications are from MSMEs involved in other business activities such as cottage industries, building and construction, manufacturing, commercial development, art and entertainment, agriculture and horticulture, take-away, fishing, among others.
92 requests have been rejected while 14 are still pending.
For the large enterprises, 26 out of 34 requests received by the credit-granting institutions have been approved as at December 7, 2021,for a total sum of R293,557,769.00 (39.14% of the R750 million made available). The approved applications are from businesses in the following sectors: tourism(15), trade(6) building and construction(3),manufacturing (1) and fishing (1). Two requests are still pending.
For both the MSMEs and large enterprises’ schemes, the differences in the reported figures is as a result of applications beingwithdrawn, cancelled or repaid.
With regard to the amount disbursed by CBS to the credit-granting institutions administering the schemes, a total of 99 requestshave been received and approved under the credit line for MSMEs, for a sum of R118,894,565.61 as at December 09, 2021. For the large enterprises category,a total of 20 applications have been received and approved by CBS for a total sum R279,046,183.00.
It is to be noted that from these disbursements,CBS has received repayments amounting to R8,511,726.77 and R2,099,198.58 under the MSME and large enterprises category, respectively.
End of FA4JR
At the end of March 2021, the Financial Assistance for Job Retention (FA4JR) scheme,established in March 2020 to assist businesses and individuals conducting economic activities (self-employed) which were affected by the Covid-19 pandemic, which brought economic activities in the country to a halt, was phased down due to budgetary constraints amid cases of abuse.
Seychellois women entrepreneurs building capacity
Over 20 Seychellois women entrepreneurs took part in a three-day capacity building training, hosted by the Seychelles Chapter of the Comesa Federation of Women in Business (COMFWB). The training was the first Regional Enterprise Competitiveness and Access to Market Programme organised in Seychelles, with the aim of building the capacity of business women to bring their services and products beyond the local market.
They were mostly women involved in small, cottage businesses such as tailoring handicrafts, graphic design and food production.They explored topics such as marketing and branding, labelling, platforms available to African women for networking and to sell their products on the continent.
Since the re-opening of our borders on March 25, to welcome back foreign visitors and different airlines, the tourism businesses, among some other businesses, flourished. The opening of our borders also resulted in the gradual revivalof our economy with the stabilisation of our foreign exchange from R22 to around R15.
The Unique Ocean Seafood Company at Providence, GrandMart Supermarket at Grand Anse Mahé and the Central Command Cold Store (CCCS) situated in Zone 14, Ile du Port, were among some of the new businesses that opened their doors this year.
Unique Ocean Seafood Company is the second fish processing plant owned and operated by James Lesperance, following the success of the JHL plant, also based at Providence. The company offers different variety of value-added products made from by-catch fish such as tuna, dorado, kingfish and so on. These include fish burgers, smoked fish, fish sausages, fish steaks and more for local and international market.
The Central Command Cold Store is a 12,600-tonne capacity facility at a cost of USD ($) 37 million. It features spaces and loaders to load fish from vessels and to facilitate sorting by type and further, by size, adding value to the stock. The shareholders in foreign exchange include the government of Seychelles with 10 percent, the Seychelles Pension Fund (SPF) with 10 percent, United Concrete Products Seychelles (UCPS) with 10 percent, IOT with 6 percent, Jaccar with 26 percent, Ile du Port Handling Services with 10 percent, SAPMER with 10 percent and Seychellois individuals with 11.5 percent.
The chief executive of GrandMart Super Market, a brand name registered under KPV(PTY) Ltd, is Veronique Laporte, one of three share holders. The supermarket brings a new shopping experience, choice and variety in terms of products to customers in the region.
The reopening of our border has also given rise for the demand of facilities to conduct the mandatory exit Covid-19 PCR tests and laboratories to analyse the samples. As a result few facilities offering access to Covid-19 PCR testing have opened their doors with latest at Le Niole Health Care Centre.
Enterprise Seychelles Agency
With regards to the Enterprise Seychelles Agency (Esa), a number of small businesses were established this year amid the pandemic and economic crisis, such as Unikshells, a new handicraft business, White Sands Ventures, a new business in the blue economy sector providing tours on marshes and wetlands among others.
The agency also partnered with SCCI and other entities to promote the Covid guidelines and to conduct post Covid Business Survivorship training sessions to business operators on Mahé, Praslin and La Digue in order to re-start operation. Participants also got to engage in a Digital forum by the agency to promote the use of technology and the importance of digitalisation in businesses, including learning on prospects in the blue economy sector and access to funding opportunities by Seychelles Conservation and Climate Adaptation Trust (SeyCCAT) and Development Bank Seychelles (DBS).
On Praslin and La Digue, ESA helped businesses with their challenges as well as training female drug addiction survivors to obtain new skills and start their own businesses.
The chairman of the Seychelles Chamber of Commerce and Industry (SCCI), Oliver Bastienne, said that since the financial year 2020 and 2021 and due to Covid-19, the country has faced itsworst recession ever known, hitting both demand and supply simultaneously, which has resulted in a contraction of our GDP.
He stated that SCCI recognises that the government’s response to Covid-19 must be sustainable so as to avoid incurring a debt too large for future generations to bear. However, the SCCI strongly believes that Seychelles cannot afford to underestimate this pandemic.
The global battle against Covid-19 is far from over. Many places are still experiencing high levels of infection and the recent re-introduction of lockdowns in major cities – in some of our own traditional tourism markets no less – confirms that. The recovery of global economic activity is expected to be long-drawn, highly uncertain, and uneven across business sectors and geographies alike.
He stated that going forward the private sector is extending its commitment to collaborate with the government in building a better Seychelles; one that is: economically vibrant, so the private sector can create good jobs for Seychelles and opportunities for all our businesses; socially cohesive, with the private sector playing its role to build a strong social contract; sustainable and green with the private sector playing a part in creating a resilient, healthy and ecologically balanced home for generations to come; and fiscally strategic to enable the private sector to continue to thrive with stability and progress.
He added that SCCI hails the government’s commitments and significant support for Seychellois and to helping businesses to better cope over this unprecedented period of the pandemic and financial crisis, and most importantly, keeping our nation safe as much as possible.
Compiled by Patrick Joubert