Poverty rate in Seychelles stands at 25.3% |28 January 2021

About 25.3 percent of Seychellois population was found to be living below the poverty line in 2018, according to a joint study on inequality and poverty rates for Seychelles by the National Bureau of Standards and the World Bank, released this month.

The inequality and poverty rates for Seychelles in 2018 uses the poverty line of R4,376 per month per adult. Therefore, when the income per adult equivalent is below the poverty line of R4,376 per month, the household and all its members are classified as poor.

Poverty lines typically follow one of two main approaches. A first approach considers that the poverty line is an absolute concept, indicating the level of consumption needed to meet just minimum food and nonfood needs. The second approach interprets the poverty line as a relative concept, so poverty is understood as a situation of relative deprivation. The actual values of the relative poverty lines increase with the economic (and social) conditions of the country.

Statisticians have used the welfare aggregate based on income per adult equivalent to estimate poverty and inequality in Seychelles.

In line with best international practice, total household income has been obtained by aggregating four main components:

• income from employment (paid and self-employment) as well as own production for all individuals in the household;
• property income: includes returns from financial assets (interests from certificates of deposit, government bonds/loans), dividends (investment in an enterprise in which the investor does not work), returns from non-financial assets (e.g., rents) and returns for services of patented or copyrighted material (e.g. royalties);
• income from transfers which includes private domestic and international transfers (remittances) as well as public transfers; and
• income from the production of household services for own consumption as defined by the net value of owner-occupied housing services, estimated by means of a hedonic regression model.

Consistent with 2013, imputed rent is not considered a source of income for tenants and as such it is not included in the income aggregate for tenants.

The total household income is then divided by adult equivalent scale to arrive at income per adult equivalent, the welfare aggregate used for poverty and inequality estimation. Adult equivalence scale is estimated such that each adult (i.e. individuals aged 15+) is counted for 1, while each child (i.e. individuals aged 0-14) is counted as 0.5. This scale was used to ensure consistency with the equivalence scale used in 2006/07 and 2013 surveys. The poverty rate for 2013 was estimated at 38.3 percent.

The total sample size of households on which the analysis is based is 2,036 households.

Compiled by Gerard Govinden