Earlier this week, the Executive Board of the International Monetary Fund (IMF) completed the fourth review under the Policy Coordination Instrument (PCI) for Seychelles. The PCI is for members of the IMF seeking to demonstrate commitment to reforms and catalyse external financing. 

The review indicates that macroeconomic performance continued to be strong in 2019. Key findings include:

• 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.
• Gross international reserves remain at an adequate level.
• IMF programme implementation is on track.
• The near-to-medium-term economic outlook continues to be favourable.

Early this morning, Fitch Ratings also affirmed Seychelles’ stable outlook with a ‘BB’ credit rating. Credit ratings have an important role in maintaining efficient markets and reflect an opinion on the relative ability of the country to meet financial commitments. Seychelles’ credit rating balances an excellent track record of adherence to IMF programmes and good governance and GDP per capita relative to peers, with the small size of the economy and its vulnerability to external shocks.

 Key findings of the Fitch Ratings report include:

• Growth forecast for 2020 was revised upwards from 3.4% to 3.8% following high tourist arrivals and a buoyant manufacturing sector, as the government increases capital expenditure with the phase in of major infrastructure and climate change related investments.
• Real GDP growth to remain strong in 2020 at 3.3%, versus a ‘BB’ median of 3.2%, supported by strong performance in the fisheries sector, dynamic tourism activities, and a recovering construction sector spurred by government housing, road and port projects.
• Seychelles' GDP per capita is 2.9x higher than the 'BB' median at a projected USD17,188 in 2019, and the country scores well above peers on World Bank governance indicators and the UN Human Development Index.

President Danny Faure welcomed the results of the reviews, which he said prove the success of policies in place, and secure the country in a strong position going into 2020.