The International Monetary Fund (IMF) Mission, led by Todd Schneider, has completed discussions with the authorities of Seychelles, which has resulted in a staff-level agreement on the fourth reviews under the Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF) arrangements. The IMF’s Executive Board will need to approve this agreement, potentially releasing SDR 10 million, approximately $13.4 million, in financing.
“The authorities continue to make progress in implementing the EFF-supported program. All end-December 2024 quantitative performance criteria under the program were met. Structural reforms related to improving the transparency of tax policy, enhancing monetary policy operations, and strengthening the effectiveness of the anti-money laundering and combatting the financing of terrorism (AML/CFT) regime were completed," Schneider stated at the conclusion of the mission.
The IMF report highlighted Seychelles' economic performance, noting in 2024 a real GDP growth estimate of 2.9 percent. Tourist arrivals experienced a minor increase of 0.5 percent, while tourist earnings saw a 6.9 percent decline. The GDP growth for 2025 is projected to rise to 3.2 percent, though potential risks remain due to global economic shifts.
Fiscal outcomes for 2024 were more robust than initially expected, with the government's primary fiscal surplus increasing to 3.2 percent of GDP, surpassing the 1.7 percent recorded the previous year. However, tax and revenue collection did not meet earlier forecasts, and government spending fell notably below expectations, particularly in capital projects.
The external current account in 2024 saw improvements, attributed to reduced imports tied to uncompleted foreign-financed projects. Seychelles' Central Bank increased its foreign exchange reserves to $774 million, amounting to 3.8 months of import cover. In 2025, a slight external account deterioration is anticipated, as tourist revenue may decline but will be somewhat balanced by lower global oil prices.
“The CBS has maintained a broadly accommodative monetary policy, facilitating a steady increase in the growth of private credit. Inflation remains low and is projected to remain below 2 percent in 2025," the statement continued, emphasizing careful monitoring and potential policy rate adjustments by the Central Bank of Seychelles.
In terms of governance, Seychelles is committed to empowering its administrative capabilities. An independent audit firm will conduct evaluations of six major public enterprises by the end of the year. The nation is also improving transparency in its beneficial ownership database and tax expenditure reporting.
Regarding climate-related policies, Seychelles progresses on reform measures as per the RSF agreement. These initiatives include the appraisal of climate risks in banking, development of disaster financing strategies, and promotion of renewable energy.
“The team thanks the Seychellois authorities for the open dialogue and close collaboration. Meetings were held with President Ramkalawan, Vice President Afif, Governor of the Central Bank of Seychelles Abel, and other senior government officials as well as representatives of the private sector,” Schneider concluded.