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Seychelles (Part 2) What’s not to like?

What’s not to like? Well in summary it can be expensive, very expensive by South African standards if you are a regular tourist.

The Seychelles is a country with a population of only 80,000 people currently reliant on tourism and tuna fishing with two other sectors of the economy under development namely offshore financial services and oil container shipping. It has a socialist government that is democratically elected. There is no tax to individuals (other than a 5% social security tax) and whilst it is the richest country in Africa in terms of GDP per capita it is also the most indebted country in the world (per capita). The country seems to continue to borrow in order to maintain its status quo, which begs the questions as to whether this is sustainable?

The official exchange rate of Seychelles Rupee (Rs) to the US Dollar was Rs 5.62 to USD 1. That makes it about Rs 1 to ZAR 1.26. However on Mahe locals frequently offered to exchange money at Rs 9 to USD 1 and on Praslin at Rs 11 to USD 1. I understand if you shop around you can even get as much as Rs 14 to USD 1. This disparity apparently happens due to the major shortage in forex as a result of the islands major dependency on imports and the government artificially keeping the local currency under valued.

I had booked to stay at the Wharf Hotel, a mere 5 minutes drive from the airport. Upon touching down and collecting my luggage I promptly summonsed the services of a taxi. The taxi driver told me the official rate to my hotel was either 15 Euro or USD 20. I thought that was a bit steep but what can you do? In retrospect if I do the calculation using the black market exchange rate back to rands that 5 minute taxi ride in effect cost me a staggering USD 20 x 14 x 1.26 = ZAR 350. Subsequently during my visit I found an honest taxi driver who told me a fair rate from the airport to the Wharf Hotel was Rs 50.

Some other costs were as follows:

Hotel Accommodation: 218 Euro per night (haggled down from 232 Euro).
A flight from Mahe to Praslin 61 Euro per person one way.
A ferry trip from Praslin to Mahe: 45 Euro per person one way.
Car Rental: 60 Euro per day for an entry level car.

Now foreigners have to pay for everything in foreign currency whereas locals pay in Rupees. For the flights and ferry tickets it seems locals pay at prices ranging between one fifth and one tenth of what foreigners pay. I understand that the Seychelles has positioned itself as a premier tourist destination but I still feel like I was being ripped off. Having said that if I were to buy property on Eden Island and become a resident of the Seychelles I might qualify for the local rates (I am however not sure).

To top things off on the day we headed off to Praslin I was relieved of my cell phone and the cash in my wallet. After locking my wallet and cell in my rental car (my little Kia 1300 at 60 Euro per day) I left the car keys and belongings on a beach nearby while heading off snorkelling on the beautiful coral reefs. Whilst I was doing this it appears some one removed the car keys from the beach, lifted my cell phone and cash from my wallet in the car and returned the keys. I must say they were fairly considerate thieves in that they left my wallet with all my cards, driver’s licence and passport behind – thank you!

Having said this, the rip off factor seems to be most prevalent in the tourist sector and looking at the price of general goods in a supermarket it did not seem to be excessively overpriced. Whilst I was bowled over by the amazing beauty of the country and I am sure I am going to return (probably even buying property), I was still left with of a bit of a sour taste in my mouth feeling somewhat ripped off.

Oh, I almost forgot - an 8 minute phone call from Praslin to South Africa to lock my sim card: Rs 290

Seychelles (Part 1) – An Idyllic Paradise?

I just returned from a trip to the Seychelles. The main purpose of my visit was because I am considering buying a property on Eden Island but I also set up a Seychelles Offshore company and opened a bank account to house my offshore investments (I used a managing agent called Fidelity to do this).

Eden Island (the island in the forefront of the image above before development started) is a special development concession given by the government of the Seychelles whereby all purchasers are eligible to receive residency in the Seychelles (at a cost of Rs50k per person for every 5 years – its almost ZAR 1 : Rs 1 so that’s about 50,000 rand). Although the development of the units on the island is in a very early stage from my visit I am quite impressed with what I saw. It seems to be very professionally managed all round.

The question is at over $300k for an entry level one bedroom apartment is it worth it and is the Seychelles the place I want to set up a holiday home? Mahe is about a 5 hour flight from Johannesburg and flights on Air Seychelles cost about R4,400 each return (including all taxes). That means after leaving home, driving to the airport, the flight, collecting baggage and catching a taxi to Eden Island it would take about 8 hours from door to door. Not too bad considering it would take you about the same time or longer to drive from Johannesburg to a holiday home on the North or South Kwazulu Natal coast (granted at a lesser cost).

There is no question that the Seychelles is an absolutely amazing place. It is the definition of an idyllic paradise. It does not strike me as being part of Africa but rather reminds me more of the Caribbean from the almost one year I spent working on super yachts in the Caribbean back in 1998/1999. Even the people seem to speak with a bit of a West Indies accent. The people too are fantastic (although definitely somewhat laid back and embrace “da island style” way of life).

I met Jose (currently is the only Seychellois with a blog called Seychelles Digital) who took us out for dinner at the boat house at Beau Vallon on the North East side of Mahe. It was very interesting to hear from him first hand what it is like to live in the Seychelles and I hope to return the favour next time he visits South Africa.

That said there was an aspect to the Seychelles I did not like – see Part 2.

Can 24.com Search compete against Google?

Lets cut to the chase. My answer to the question posed by the title of this post is an emphatic NO. My reasoning is very simple. Search for "online auctions" on Google and then apply the same search to 24.com. On Google surprise, surprise bidorbuy came up first and on 24.com I had to scroll to page 7 for the first entry for bidorbuy (which we know almost no one ever does).

Call me biased if you want but surely the (by quite some distance) largest and most popular online auction site in South Africa should appear at the top of the list? Maybe this will change over time but this seems highly unlikely to me. The relevancy of 24.com's results is simply not there. After this simple experience how can I now trust 24.com for any other searches I want to do. Sorry 24.com, I am not going to think twice and go to Google as my first point of call.

At least on Ananzi bidorbuy appears first but lets not let Ananzi hijack this post and talk about them another time.

I am sure 24.com have good reasons of there own to go the route they have but if I were them I wouldn't think twice about rather doing a revenue sharing deal with Google. I don't know the exact numbers but I reckon they could get at least an 80% revenue share. If that were the case surely it is a no brainer. Whatever the case, the costs involved of running your own search engine surely have to merit rather partnering with the search behemoth even if you thought you could provide as relevant results as they do.

I have this view that certain Internet businesses can be successful in a territory without having a physical presence in that territory. These are businesses where there is only an exchange of information (such as search). Whereas other Internet businesses require that the company has a physical presence in that territory (such as online marketplaces where there is normally an exchange of goods and money - even though the company is not physically selling goods themselves think about localised shipping and payment options).

Having said that it is interesting that the following South African Google job positions have been up on Google's web site for some time now. As far as I am aware they have not hired any one locally yet. I wonder if they simply have not had any quality applications yet? Whatever the reason they seem to be doing pretty well without even having a single employee in the country. I know we are paying them a lot of money every month through Google Adwords.

I hate SPAM but ...

I hate spam as much as anyone else (in fact probably more than most). Since we switched over to using the new Gmail Apps service for all our email it has been such a treat with only the isolated case of spam email slipping past the Gmail spam filter.

On the flip side of the coin, spammers cause serious problems for us who legitimately send bulk email to opt in users. bidorbuy only sends emails to those who have opted in and in every newsletter we include a clear unsubscribe link (which when clicked on automatically populates the field with the email address the email was sent to). See an example. One problem we had in the past was some times users have a number of aliases and so if you leave it up to them to enter the email address they may not know which alias they originally subscribed with - the system above, whereby we automatically populate the field, besides making it easier for the user fixes that problem. Nevertheless last night I received the following email from spamcop:

From: Donn Edwards [mailto:xxxxxxx (at) spamcop.net] Sent: 17 April 2007 09:57 PMTo: hello (at) bidorbuy.co.zaCc: andy.higgins (at) bidorbuy.co.zaSubject: FW: BIDorBUY keeps sending me SPAM

Dear Mr Higgins

I strongly suggest you comply with the request by Andrew Edwards to have his name removed from your mailing database. Failure to do so will result in you being prosecuted in terms of the ECT Act, which carries a 1 year jail term.

Also, your site does not comply with the Access to Information act, so further legal sanctions could be forthcoming.

Best wishes
Donn Edwards

-----Original Message-----From: Andrew Edwards [mailto: xxxxxxxxxxxxxxxxx] Sent: 17 April 2007 18:43 pmTo: xxxxxxx (at) opa.org.zaCc: 'bidorbuy.co.za'; Donn EdwardsSubject: BIDorBUY keeps sending me SPAM

The user also complained that he had tried to make contact with us 3 times. We operate a helpdesk system so that each time some one emails us they get sent an auto response with a ticket number for easy future reference. I checked in our helpdesk system and there was only one email from this user and that was sent last night (he could have sent an email using a different email address but I asked him to send us ticket numbers so we could follow up on why his query was not dealt with and so far I have not had a response).

I appreciate that people like spamcop are trying to help the situation but it would be great if there was some kind of system whereby reputable companies such as ourselves could be put on some kind of a white list and if there are problems then these problems are escalated to us in some organised manner rather than me being annoyed at receiving emails such as the one above.

PayPal in South Africa

I am often asked why PayPal do not allow South Africans to receive money as it can be argued this largely prevents South Africans from fully participating in the global Internet economy. I imagine for the most part South Africans would use PayPal for International transactions i.e. receiving money from people outside South Africa for various online (and possibly offline) services. For transactions with fellow South Africans, first of all PayPal don't offer the local currency and secondly why would people want to transact using PayPal when they can use the local banking system at no (or a significantly reduced) cost compared to using PayPal? Maybe South Africans trading with each other would still use PayPal for convenience factor and the instant nature of the system (not having to wait for payments to clear - this would certainly be a plus for merchants)?

Considering PayPal has only allowed South Africans to make payments using PayPal since June 2005, some people might say PayPal is simply not interested in the South African market as it is too small. As far as I am aware the main reason PayPal does not allow South Africans to receive money with PayPal is because of South African exchange control regulations imposed by the South African Reserve Bank. There are ways around this of course. If you know some with a US, UK or Australian bank account for example you could ask them to set up a PayPal account for you through which you can receive money and you would then have to get them to transfer you this money using an International TT periodically (quite a mission). Alternatively you could set out to open a foreign bank account for yourself (even more of a mission).

Until the Reserve bank totally relaxes exchange control regulations (my tax advisor told me 2 years ago that she believed this was imminent at the time but last time I met with her she seemed to have back tracked on that opinion somewhat), I don't think we will see PayPal opening up any further to South Africans.

MyAdsl

Its amazing what a strong community the MyAdsl web site has become. I am all for such open communities and applaud the site and Rudolph for the fantastic work they are doing in being activists towards bringing down the costs / improving service levels in the broadband space in South Africa. Its exactly what we need.

I believe strongly that by making broadband access (not so much the speed but the always on-ness) affordable to main stream South Africans, will be the single biggest stimulant to growing online commerce in South Africa (while adding many South Africans to the Internet economy thereby uplifting the country overall socially and economically).

Having said this, from my personal experience I have found some of the members on MyAdsl to be quite scathing having posted very negative things about bidorbuy for example (without having substantiated their information). Some times it seems we as South Africans have become very negative and cynical towards things (and companies in particular). I almost want to say to these guys making these negatives posts, "While we are a business so we need to make money, I'm on your side! We want the same things - fairness and justice in this world." I want bidorbuy to be a strong close knit community like the MyAdsl community where the majority viewpoint of our community rules. Perhaps that is a bit idealistic?

I suppose it is par for the course that as we grow we will get more and more of this type of thing happening on open forums. Also, I suppose it only takes a few disgruntled customers to initiate these negative posts. What can do?