Seychelles Goes the Way of Iceland

Clear blue waters. White-sand beaches. Wealthy vacationers soaking up the sun. Seychelles has all of these things. Unfortunately, this tiny island country off the coast of Africa is also bankrupt.

This playground of the rich and famous is saddled with more than $800 million in debt, taking a page out of Iceland's "How To Destroy a Country's Economy" handbook. With sagging revenues from the country's two biggest source industries -- fishing and tourism -- Seychelles' debt is about the same as the country's total economy.

It's already defaulted on one $230 million loan and is now seeking relief from countries -- including the U.S. -- it owes.

"We borrowed more than we can repay," complains Ralph Volcere, the editor of Le Nouveau Seychelles Weekly and a vocal government critic. "This was wholly irresponsible."

In the hopes of boosting its tourism industry, the country is launching an "Affordable Seychelles" campaign with the motto, "Once-in-a-lifetime vacation at a once-in-a-lifetime price," in the hopes of drawing visitors. Affordable might be overstating it, but there are certainly deals to be had.