04.26.11

Seychelles Central Bank’s Head says Public Debt is to Fall on Economic Reform

Posted in Seychelles' statistics at 4:25 pm by Robert Klien

According to Central Bank of Seychelles Governor Pierre Laporte, the offshore juridiction expects public debt to shrink to 50% of GDP (gross domestic product) by 2017 on further economic reforms.

In an interview held on April 2, Laporte said: “We are back on track after implementing reforms and tightening monetary policy”. He explained that public debt has decreased to about 80% of GDP from 160% 3 years ago. According to the IMF, Seychelles’ external debt almost halved over the past 2 years to 48% of GDP.

In 2008, after missing interest payments on bonds and defaulting on privately placed securities, when higher oil prices and falling tourism crimped government revenue, Seychelles sought help from the International Monetary Fund. Consumer prices declined on an annual basis in February after reaching a peak of 63% in December 2008.

Laporte said that the country’s structural reforms are ahead of target, with the fiscal surplus at 9% of GDP in 2010. The surplus is to decline to about 4.5% in 2011, because of investment in key infrastructure projects. The Central Bank’s website says that gross international reserves have surged to $244 million from $11 million in the 4th quarter of 2008.

Laporte said that FDI (foreign direct investment) will probably fall by 54% to $149 million in 2011 compared with a year earlier. Economic growth may slow to 4%.

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