Seychelles Faces 1.5% Growth After IMF Final Reviews
SEYCHELLES · ECONOMY EXPLAINER
Key Facts
- The decision The IMF board finished the last two reviews of Seychelles’ loan programs on 26 May 2026 and released about US$41 million at once.
- Growth Growth is projected to slow to 1.5% in 2026, down from an estimated 5.1% in 2025.
- Debt Public debt, including state guarantees, fell to 53.6% of GDP in 2025 and is projected at 57.1% in 2026.
- Gulf exposure About 60% of tourists connect through Doha, Dubai or Abu Dhabi, so the war in the Middle East matters.
- External gap The current account deficit is projected to widen to 7.8% of GDP in 2026 from 6.5% in 2025.
- Reserves Gross official reserves were US$878 million in 2025 and are projected at US$828 million in 2026.
- What it means for you Gulf flight routing is the exposure to watch for US travellers to Seychelles.
The International Monetary Fund has signed off the last Seychelles loan reviews and calls the Middle East war a near-term shock. Growth is forecast to slow sharply in 2026.
- IMF: the International Monetary Fund, a global lender that supports governments with loans and advice.
- GDP: gross domestic product, the total value of what an economy produces in a year.
- Primary surplus: the government budget balance before interest payments on debt.
- Current account: the balance of trade, tourism income and transfers between Seychelles and the rest of the world.
The International Monetary Fund (IMF), a lender to governments, finished its last two Seychelles loan reviews on Tuesday, 26 May 2026. The island nation can draw about US$41 million at once.
In that release the IMF expects growth to slow to 1.5% in 2026, from an estimated 5.1% in 2025. It calls the war in the Middle East a near-term shock.
This explainer covers a five-month-old release, and no newer IMF figures for Seychelles were found on 31 October 2026. Later data may differ.
What the IMF Decided
The board completed the fifth and sixth reviews of two arrangements. They are the Extended Fund Facility, a reform-linked loan, and the Resilience and Sustainability Facility, a climate-linked loan.
The board also concluded the 2026 Article IV consultation, the IMF’s yearly health check of a member country’s economy. The next one is expected on the standard 12-month cycle.
IMF staff and Seychelles agreed terms on 19 March 2026, after a mission to Victoria from 4 to 19 March. The mission was led by IMF official Todd Schneider.
That March agreement envisaged up to US$45 million for these reviews, and the board released about US$41 million. The IMF release does not explain the difference.
The IMF says all but one quantitative target was met under the loan. Two structural reform benchmarks were missed and are likely to be finished after the program ends.
One climate reform under the second facility also remains unfinished. A Post-Financing Assessment, an IMF check on countries that still owe it money, will follow.
The 2026 Numbers
Growth of 5.1% in 2025 was driven by record tourist arrivals, the IMF says. For 2026 it projects 1.5%, and its table shows growth of 4.0% in 2027.
Public debt including state guarantees fell to 53.6% of GDP, the size of the economy, in 2025. The IMF table projects it rising to 57.1% in 2026.
The primary surplus, the budget balance before interest payments, was 2.5% of GDP in 2025. It is expected to shrink to about 0.9% in 2026, against 1.5% in the budget.
The current account deficit, the gap between what Seychelles earns from and pays to the world, was 6.5% of GDP in 2025. The IMF expects it to widen to 7.8% in 2026.
Gross official reserves were US$878 million in 2025, the IMF table shows. They are projected at US$828 million in 2026.
Why the Middle East War Matters
About 60% of tourists arrive through Doha, Dubai or Abu Dhabi, the three Gulf aviation hubs. Seychelles also imports about 95% of its energy, much of its food and most industrial inputs.
The IMF’s March statement cites higher oil and food prices and rising freight costs as pushing up 2026 inflation. The May release projects the current account gap to widen.
What the IMF Wants Next
On the budget, the IMF urges steady consolidation through more revenue, tighter spending and closer oversight of state firms. It wants public debt to move gradually toward a medium-term anchor of 50% of GDP.
On money, it says the Central Bank of Seychelles should stand ready to tighten policy to anchor inflation expectations. It also urges the bank to keep building reserves while keeping the exchange rate flexible.
For banks, the IMF flags rising household credit and calls for stronger supervision and anti-money-laundering controls. It also cites oversight of virtual asset providers, which are crypto businesses.
In March the IMF listed reforms still pending, including cost-reflective multi-year electricity tariffs awaiting Cabinet approval. Spending reviews of the finance, education and health ministries are due by the end of 2026.
What It Means for You
For US travellers, flight routing is the exposure to watch, because most visitors connect through the Gulf. Book flexible tickets and check airline schedules before you pay.
For US lenders and investors, the IMF sign-off shows reform targets were largely met. Growth is still forecast to slow sharply, and debt is projected to rise again.
What Is Not Known
The IMF release gives two inflation readings for end-2025: just below zero in the text and 3.1% in its table. This guide therefore gives no inflation figure.
The release also gives reserves as over four months of imports in the text and 3.6 months in the table. It does not state the program end date.
No newer official data on 2026 visitor arrivals or the central bank’s latest rate decision was confirmed for this guide. The full-year effect of the war on tourism earnings is unknown.
Related Coverage
Read the background in How Seychelles Lives on Tourism and Tuna and the full Seychelles explained guide. The Seychelles news hub lists all coverage.
See also the island’s blue economy and debt and the president’s UN speech on small islands. Both set the IMF numbers in context.
Frequently Asked Questions
What did the IMF decide for Seychelles?
It completed the fifth and sixth reviews of two loan programs on 26 May 2026. About US$41 million was released at once.
How fast will Seychelles grow in 2026?
The IMF projects growth of 1.5%, down from an estimated 5.1% in 2025. Its table shows 4.0% growth in 2027.
Why does the Middle East war matter to Seychelles?
About 60% of tourists arrive through Doha, Dubai or Abu Dhabi. The island also imports about 95% of its energy.
How much public debt does Seychelles have?
Debt including state guarantees fell to 53.6% of GDP in 2025. The IMF table projects 57.1% in 2026.
Sources: International Monetary Fund, Executive Board press release 26/171, 26 May 2026; International Monetary Fund, staff-level agreement press release 26/80, 19 March 2026; International Monetary Fund, Seychelles country page (all accessed 31 October 2026).
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief