IMF Executive Board Completes Fourth Review Under the Policy Coordination Instrument for Seychelles
December 18, 2019
- The implementation of the Seychelles’ economic program is largely on track.
- The 2019 economic growth is estimated to reach about 4 percent, reflecting strong output in the tourism and communication sectors.
- The near-to-medium-term economic outlook continues to be favorable, provided that the authorities maintain their prudent policies under the Policy Coordination Instrument.
On December 17, 2019, the Executive Board of the International Monetary
Fund (IMF) completed the fourth review under the Policy Coordination
Instrument (PCI) for Seychelles.
The Executive Board’s decision was taken without a meeting.
The PCI was approved on December 13, 2017 (see
Press Release No. 17/492). Seychelles was the first IMF member country to request a PCI, since the
Executive Board of the IMF approved the PCI as a new non-financing
instrument to further enhance the effectiveness of the Fund’s toolkit.
Macroeconomic performance continued to be strong in 2019. Economic growth
is estimated to reach around 4 percent, reflecting strong output in the
tourism and communication sectors. Inflation has been on a declining trend
since early 2018. The gross international reserves remain at an adequate
level. The Central Bank of Seychelles (CBS) lowered the monetary policy
rate at end-September 2019, citing benign inflationary pressures in the
coming months. Program implementation is largely on track, while the 2020
budget submitted to the National Assembly is in line with the program. The
near-to-medium-term economic outlook continues to be favorable, provided
that the authorities maintain their prudent policies under the PCI.
The authorities are committed to the primary fiscal surplus target of 2½
percent of GDP through 2022, by steadily reducing the public debt-to-GDP
ratio over the medium term and implementing permanent measures envisaged in
the 2020 budget. The government intends to keep a very tight rein on Air
Seychelles’ financial position. The CBS is committed to a flexible exchange
rate, while being vigilant to both upside and downside risks to inflation.
The structural agenda focuses on strengthening the AML/CFT framework,
buttressing financial stability, and enhancing inclusive growth, including
by improving the business climate.
The Executive Board takes decisions without a meeting (based on
lapse-of-time procedures) when it is agreed by the Board that a
proposal can be considered without convening formal discussions.
IMF Communications Department
PRESS OFFICER: Meera Louis
Phone: +1 202 623-7100Email: MEDIA@IMF.org