Seychelles: Request for an Extended Arrangement Under the Extended Fund Facility-Press Release; Staff Report; and Statement by the Executive Director for Seychelles
IMF Staff Country Reports, August 23, 2021
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- Seychelles: Request for an Extended Arrangement Under the Extended Fund Facility-Press Release; Staff Report; and Statement by the Executive Director for Seychelles
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Bibliographic details
- Published: August 23, 2021
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513594064.002
Summary
- Seychelles was hit hard by the COVID-19 crisis.
- Authorities reacted swiftly, by locking down the economy, thereby keeping infection and fatality rates low.
- Travel restrictions and the global economic downturn triggered unprecedented economic contraction.
- Authorities implemented measures to mitigate the economic fallout on businesses and households.
- The public debt ratio increased sharply, reflecting the primary balance deterioration, exchange rate depreciation, and GDP contraction.
- As soon as vaccines became available, Seychelles led the world in vaccination coverage and reopened its borders.
- With tourist arrivals bouncing back, a V-shaped recovery is now expected.
Key findings and context
- COVID-19 shock: unprecedented economic contraction driven by travel restrictions and global downturn.
- Health response: early lockdowns limited infections and fatalities.
- Fiscal impact: sharp increase in the public debt ratio due to primary balance deterioration, exchange rate depreciation, and GDP contraction.
- Recovery drivers: rapid vaccination rollout and reopening of borders supporting tourism-led rebound.
Macroeconomic outlook
- Recovery characterization: a V-shaped recovery is expected as tourist arrivals bounce back following reopening and high vaccination coverage.
Fiscal and public debt issues
- Public debt: increased sharply (attributed to primary balance deterioration, exchange rate depreciation, and GDP contraction).
- Fiscal measures: authorities enacted policies to mitigate impacts on businesses and households (specific measures not listed in the summary).
Subject coverage and keywords
- Subject: Asset and liability management, Debt management, Expenditure, Fiscal policy, Fiscal stance, Government debt management, International organization, Monetary policy, Public debt, Public financial management (PFM)
- Keywords: Debt management, debt sustainability risk, financing option, Fiscal stance, GDP contraction, Global, Government debt management, government institution, liability management operation
Content in this bundle
- 1sycea2021001