The IMF Executive Board completed the fifth and sixth reviews of Seychelles's economic programme on 26 May 2026, immediately unlocking approximately $41 million under the Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF) arrangements. The disbursements aim to "strengthen macroeconomic stability, sustain growth, and reinforce fiscal and monetary policy frameworks."
Slowing Growth After a Record Year
Following a strong 5.1% expansion in 2025, Seychelles's real GDP is projected to grow by just 1.5% in 2026, before stabilising at around 3.3% annually through 2031. This slowdown partly reflects the normalisation following post-pandemic rebound effects, as well as ongoing fiscal adjustments aimed at controlling public debt.
Debt Under Watch
Public debt is expected to reach 57.1% of GDP in 2026 — a significant level for a small island economy — before being brought down to 48.2% by 2031 through the authorities' fiscal consolidation efforts. Gross official reserves are projected at $828 million, representing 3.7 months of imports, a level the IMF considers adequate.
Programme Priorities
The programme rests on six pillars: revenue mobilisation, public debt management, financial sector strengthening, climate resilience enhancement, current account deficit reduction, and maintaining exchange rate flexibility. Seychelles entered this IMF arrangement in a context of heightened vulnerability to climate shocks, which weigh on tourism revenues and coastal infrastructure.
Why It Matters
IMF support serves as a credibility certificate on international financial markets, facilitating refinancing at favourable terms. For other islands in the region — Mauritius, Réunion, Madagascar — the Seychelles example illustrates the inherent tensions in managing small island state macroeconomics: growth, debt and climate resilience do not always pull in the same direction.
Source: IMF, press release of 26 May 2026.