PORT-LOUIS, Dec. 3 (Xinhua) -- The International Monetary Fund (IMF) has welcomed the "very strong" economic recovery of the Seychelles economy, Seychelles News Agency reported Saturday, citing Seychelles Finance Minister Naadir Hassan.
This came after the IMF board completed its third review of Seychelles' economic performance on Thursday, allowing the island nation to draw new funding under the 32-month Extended Fund Facility (EFF).
"This approval of the implementation of the economic reform program by the IMF board is a further indication that the government's decisions have proven to be the right ones so far and, more importantly, that the actions taken have been responsible and are laying the foundation for Seychelles' prosperity," the news agency quoted Minister Hassan as saying.
The IMF said in a report that Seychelles' economic recovery remained very strong in 2022, fuelled by a faster-than-expected rebound in the tourism sector. By the end of September 2022, tourist arrivals were 125 percent higher than in the same period in 2021, with stronger-than-expected demand from Europe and the Middle East.
It added that the recovery was accompanied by significant fiscal consolidation and social support for the most vulnerable.
However, the IMF warned that while Seychelles' economic outlook is positive, "it remains subject to risks, including a deteriorating economic outlook in many of Seychelles' key tourism markets, high food and fuel prices and their effect on the most vulnerable, a resurgence of COVID-19, higher-than-expected inflation, and an increase in non-performing loans from old dependent loans."
Seychelles and the IMF have agreed on an economic reform program under the Extended Fund Facility at the end of July 2021, due to the devastating impact of the COVID-19 pandemic on the country's economy.
