IMF Executive Board Concludes 2026 Article IV Consultation and Completes Fifth and Sixth Reviews Under the Extended Fund Facility and Resilience and Sustainability Facility with Seychelles

IMF News, May 26, 2026

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Published: May 26, 2026

Key decision and disbursement

The Executive Board completed the fifth and sixth reviews of Seychelles’ performance under the Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF).
Completion of the reviews allows for an immediate disbursement of about US$41 million to:
- strengthen macroeconomic stability,
- sustain growth,
- reinforce fiscal and monetary policy frameworks,
- support efforts to strengthen resilience to climate change,
- exploit synergies with other sources of official financing, and
- catalyze financing for climate-related investments.

Economic performance and recent outturns

Real GDP growth for 2025 is estimated at 5.1 percent, driven by record tourist arrivals.
Headline inflation (CPI) was just below zero at end-year 2025.
Fiscal outturn: primary surplus of 2.5 percent of GDP in 2025 (tighter than targeted).
Public and publicly guaranteed debt to GDP declined to 53.6 percent.
External current account deficit dropped to 6.5 percent of GDP.
Foreign exchange reserves rose to over 4 months of import cover.
Achievements noted: reduction of public debt, rebuilding foreign exchange reserves, strengthening monetary policy framework and financial sector supervision, advancing climate-related reforms.

Risks, outlook, and projections

Near-term shock: war in the Middle East raises significant challenges for Seychelles.
- About 60 percent of tourist arrivals in Seychelles come through Doha, Dubai, or Abu Dhabi.
- Seychelles imports about 95 percent of its energy, much of its food, and most of its industrial inputs.
Baseline projections for 2026 under specified assumptions:
- Real GDP growth expected to fall to 1.5 percent in 2026.
- Inflation to rise to 3.1 percent by end-year 2026.
- Primary fiscal surplus projected to fall to about 0.9 percent of GDP (compared to 1.5 percent in the budget).
- External current account deficit projected to expand to 7.8 percent of GDP.
Directors highlighted elevated downside risks and the need for policy flexibility to adjust to shocks.

Program implementation and reform progress

EFF program performance:
- All but one of the quantitative targets for the 5th and 6th reviews were met.
- Most structural benchmarks (SBs) under the EFF were met.
- Two SBs have not been met but are likely to be finished after the program ends.
RSF program implementation:
- All but one of the reform measures (RMs) slated for the reviews were implemented.
- Implementation broadly in line with expectations and Fund technical assistance recommendations.
- One RM not fully completed; work will continue after program end.
Over the past three years, the EFF and RSF supported Seychelles in navigating successive shocks, strengthening macroeconomic fundamentals, and enhancing climate resilience.
Given outstanding credit to the Fund, Post Financing Assessments will be conducted.

Executive Board assessment and policy recommendations

Directors commended strong program performance that supported macroeconomic stability, strengthened buffers, and advanced structural and climate-related reforms.
Fiscal policy recommendations:
- Continue prudent fiscal consolidation supported by revenue mobilization, expenditure rationalization, and strong SOE oversight.
- Gradual reduction of public debt toward the medium-term anchor of 50 percent of GDP.
- Carefully calibrate further planned increases in social welfare spending and make increases contingent on gains from revenue mobilization.
- Create fiscal space and strengthen capacity to ensure sufficient public investment to support growth and climate resilience.
- Strengthen public financial, investment, and debt management, and enhance SOE oversight.
Monetary and exchange rate recommendations:
- Monetary policy should remain data-dependent; the Central Bank of Seychelles (CBS) should closely monitor monetary and financial conditions, enhance communication, strengthen the monetary policy framework, and stand ready to tighten as needed to anchor inflation expectations.
- Continue building international reserves while preserving exchange rate flexibility as an important shock absorber.
Financial sector recommendations:
- Close monitoring of rising household credit and sectoral concentration risks.
- Continue strengthening risk-based supervision, fully implement the bank resolution framework, and reinforce crisis preparedness and financial safety nets.
- Improve AML/CFT framework, beneficial ownership information, and oversight of virtual asset service providers.
Directors welcomed completion of EFF and RSF arrangements and looked forward to a Post-Financing Assessment and continued Fund engagement through policy advice, surveillance, and capacity development.
Expectation: next Article IV consultation with Seychelles will be held on the standard 12-month cycle.

Selected economic and financial indicators (highlights from the 2023–31 table)

Nominal GDP (millions of Seychelles rupees): 2023: 30,441; 2024: 32,381; 2025: 34,134; 2026: 35,373; 2027: 37,303; 2028: 39,007; 2029: 40,862; 2030: 42,841; 2031: 45,138.
Real GDP (millions of Seychelles rupees): 2023: 26,233; 2024: 27,112; 2025: 28,493; 2026: 28,926; 2027: 30,087; 2028: 31,077; 2029: 32,100; 2030: 33,157; 2031: 34,248.
Real GDP growth (annual percent change): 2023: 5.2; 2024: 3.4; 2025: 5.1; 2026: 1.5; 2027: 4.0; 2028: 3.3.
CPI (annual average): 2023: -1.0; 2024: 0.3; 2025: 2.6; 2026: 1.7; 2027: 2.1; 2028: 2.4; 2029: 2.5.
CPI (end-of-period): 2023: -2.7; 2024: -0.2; 2025: 3.1; 2026: 1.6; 2027: 2.2.
Primary balance (percent of GDP): 2025: 2.5; 2026: about 0.9 (projected).
Total government and government-guaranteed debt (percent of GDP): 2023: 57.2; 2024: 58.1; 2025: 53.6; 2026: 57.1; 2027: 56.0; 2028: 54.3; 2029: 52.4; 2030: 50.6; 2031: 48.2.
Current account balance including official transfers (percent of GDP): 2023: -6.4; 2024: -7.9; 2025: -6.5; 2026: -7.8; 2027: -5.6; 2028: -5.8; 2029: -5.4; 2030: -4.7; 2031: -4.6.
Total external debt outstanding (millions of U.S. dollars): 2023: 5,651; 2024: 5,898; 2025: 6,154; 2026: 6,498; 2027: 6,717; 2028: 6,658; 2029: 6,645; 2030: 6,654; 2031: 6,678.
Gross official reserves (end of year, millions of U.S. dollars): 2023: 682; 2024: 774; 2025: 878; 2026: 828; 2027: 876; 2028: 902; 2029: 955; 2030: 1,035; 2031: 1,075.
Months of imports, c.i.f.: 2025: 3.6 (noted as over 4 months of import cover in narrative due to reserve accumulation).

IMF Executive Board Concludes 2026 Article IV Consultation and Completes Fifth and Sixth Reviews Under the Extended Fund Facility and Resilience and Sustainability Facility with Seychelles (Press Release No. 26/171, May 26, 2026).