IMF commends Seychelles’ reform achievements |08 May 2009

“We can see very good results in just six months, and that’s quite a remarkable achievement,” said Paul Mathieu, who gave the recent drop in month-on-month inflation to below zero as an example.

The mission is here to carry out its second quarterly review under a two-year Stand-By Arrangement approved by the fund’s executive board last November.

Mr Mathieu said the economy is stabilising and our progress has been recognised by the Paris Club of creditors who recently cancelled 45% of our debts.

“I’ve been working in 15 countries’ programmes and I’ve never seen the degree of ownership of a programme that I have seen in Seychelles,” he said, talking of the great courage we have needed to summon to meet our set targets.

He said the team are here to confirm that the situation is indeed as they have assessed it to be.

Principal secretary for finance Ahmed Afif said the mission is like an audit to vet the figures Seychelles has provided and determine, before presenting a report to the board, that Seychelles is on track.

“The mission is always in contact with Seychelles, and we exchange information with the IMF almost daily, so by the time they come here they have an extremely good picture of where we are in terms of all the indicators,” he said.

“What they are doing is therefore more or less an audit and cross-referencing. The initial feedback from the impression they have already formed themselves is quite good, going by principal indicators like the primary balance of the government – what it has achieved versus what it has projected.

“Other indicators would be the net international reserves and reserve money, which are measured by the Central Bank, and other indicators like non-accumulation of arrears and not taking on new unsustainable debts.”
He said the team will also look at other benchmarks such as structural and tax reforms.

As part of this review, the mission will hold extensive talks with the authorities to evaluate performance in the first quarter of 2009 in line with the economic reform programme.

The first review was held in January, when the mission and the authorities jointly updated the macro-economic and financial objectives and policies for 2009, and the medium-term macro-economic outlook in the light of the economic performance and the deterioration in the global economic environment.

The mission is due to remain in Victoria till May 18, and members are expected to attend the first Seychelles Forum set to take place on that date.

It will be held under the theme: Paving the way towards a sustainable economy.

Apart from the Central Bank and the Ministry of Finance, the forum will be attended by key partners such as the IMF, African Development Bank and the World Bank at international level, and the Seychelles Association of Offshore Practitioners and Registered Agents (Saopra) and the Seychelles Chamber of Commerce and Industry as local partners.

These bodies will report on developments in the economic reform programme and its current impact.