Wednesday, February 18, 2009

SEYCHELLES: Action proposed to cut cost of living

Seychelles Nation, 13.02.2009

Action to cut the cost of living in three key areas – food prices, bus fares and bank interest rates – has been proposed at high-level meetings this week.

Among recommendations made were that a wider choice of food products should be available, that bus fares should be reviewed after the recent rise from R3 to R7 and that measures to influence banks’ interest charges should be taken.

The proposals came out of meetings the Economic Reform Oversight Committee (Eroc) of the National Assembly held with the Seychelles Public Transport Corporation (SPTC), the Central Bank and the Seychelles Trading Company (STC) on Tuesday, Wednesday and Thursday. 

The committee’s main concern was to curtail the ever-increasing cost of living, to make services such as transport and banking more affordable and to reinforce financial stability for ordinary citizens during this economic transition period.

In talks with SPTC managing director Daniel Gappy, the committee – chaired by Charles De Commarmond and mandated to supervise the economic reform programme – proposed that the corporation considers reviewing its bus fares by providing a better package to commuters so they can afford and sustain their transport costs.

Concerns were also raised about the condition of SPTC buses. The committee was told that old buses desperately need to be replaced but due to a lack of funding this has not been possible. 
Mr Gappy reassured the committee that the SPTC will look seriously at both matters.

Eroc also met the governor of the Central Bank, Pierre Laporte, with a view to assessing the progress made in foreign exchange stability and availability since the economic reform programme began.

Both sides agreed that measures, including legislation, need to be introduced to more proactively influence interest rates with a view to bringing down the cost of living. Such measures would include a review of the Central Bank Act to control the minimum foreign exchange that banks can hold and to ensure greater supervision of the banks’ activities.

During the meeting held with the STC, the committee expressed concern about the lack of choice of commodities on the local market, a factor that contributes to their high prices.

Both Eroc and the STC were of the view that as soon as practicable a larger range – especially of essential commodities such as rice, flour and infant formula – should be introduced on the domestic market.

Finally, the committee expressed its satisfaction that the STC will review its prices on a three-monthly basis and hoped it will be in a position to bring them down next time round.