06.07.14

IMF Loan to support Seychelles Economy

Posted in Business and Economy, International Organisations, Seychelles government at 1:35 pm by Robert Klien

On June 5, 2014, the International Monetary Fund (IMF) issued a press release to announce that it has approved a 3-year arrangement worth about USD 17.6 million. The money is intended to support the Seychelles economic program.

The economic program is designed to strengthen macroeconomic stability, reduce vulnerabilities, and support wide-ranging structural reforms that are aimed at establishing the foundation for sustained and inclusive growth.

The authorities aim to reduce the debt-to-gross domestic product (GDP) ratio to below 50% by 2018. The International Monetary Fund said that this requires continued fiscal primary surpluses of 3-4% of GDP over the medium term, while a balance must be struck between debt reduction and addressing vital social and investment needs. Revenue measures will focus on improving tax compliance and administration, and enhancing the quality of fiscal spending.

According to the IMF, the implementation of a new generation of ambitious structural reforms, such as the adoption of measures to combat international tax evasion, will be necessary for the Seychelles to sustain growth and tackle risks to stability.

The Seychelles will receive an immediate disbursement of about USD 2.5 million from the IMF. The remaining amount is subjected to semi-annual program reviews and it will be paid over the duration of the program.

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