Economic Transformation Strategy
CHAPTER 2 / BROAD STRATEGY FOR DEVELOPMENT
PILLAR 5: ECONOMIC TRANSFORMATION
Economic transformation emphasises the progression of economic activities and resources from low-productivity to
high-productivity activities within and across all sectors. Such movement of resources is a key driver of economic de-
velopment. Within sector productivity, growth entails the adoption of new technologies and management practices that
increase the efficiency of production. It can come about as a result of the increased efficiency of existing firms or as a
result of the reallocation of resources away from the least productive firms towards more productive firms. Economic
transformation can be measured through production or value-added measures.
From the extensive consultations with relevant stakeholders, it became clear the economy needs to undergo a pro-
cess of transformation for the successful achievement of Vision 2033. Since attaining its independence, Seychelles
has transformed from a plantation-based economy to a service-based economy. In moving from agriculture to tourism,
Seychelles' rich environmental endowment was utilised in a different way. Tourism currently accounts directly for about
a quarter of GDP and employment. Seychelles has developed a strong tourism brand that places the country at the
high end of the global tourism market. Below depicts the inverse relationship between the number of tourist arrivals and
tourism yields between the periods of 2000-2015.
While tourist numbers have surged, yields
300
200
Arrivals (thousands)
100
0
2000
have declined
2,500
Yield
-Tourist arrivals
2,000
1,500
1,000
500
0
2006
2009
2012
2015
2003
Receipts/tourist (US$)
Source: World Bank staff calculations based on National Bureau of Statistics and World Development Indicators data
Overall, the service-based sector of the economy accounts for about three quarters of GDP. Industry contributes almost
all of the rest of output, mainly fish processing (a tuna cannery is the largest single employer on the main island of Mahé).
In addition, utilities and construction account for approximately five percent of output.
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