Resilience and sustainability: IMF chooses Seychelles for pilot financing mechanism

Calixte Ahokpossi met with Seychelles' President Wavel Ramkalawan at State House on Tuesday. (Seychelles Nation)

Seychelles is set to become a pilot country to benefit from the International Monetary Fund's (IMF) newly launched Resilience and Sustainability Facility (RSF), announced the mission chief for the island nation on Tuesday.

Initiated in October 2022, the Resilience and Sustainability Facility provides affordable long-term financing to countries undertaking reforms to reduce risks to prospective balance of payments stability, including those related to climate change and pandemic preparedness.

Calixte Ahokpossi made the statement to the press after meeting Seychelles' President Wavel Ramkalawan at State House to discuss two IMF programmes for the country. He was accompanied by IMF's resident representative, Aissatou Diallo, Seychelles' finance minister Naadir Hassan and the governor of the Central Bank of Seychelles, Caroline Abel.

The IMF team is in the country at the request of local authorities. 

"We discussed the Extended Fund Facility and the new facility called the Resilience and Sustainability Facility. The latter goes to support the climate-related efforts of governments around the world," said Ahokpossi.

He outlined that Seychelles was chosen as one of the pilot countries to benefit from that fund based on its track record as Seychelles is at the forefront of climate actions with comprehensive climate programmes that are already being implemented in marine protection, coastal protection, and a lot of other areas.

"What we are doing is giving a push to the country to support those policies and also help catalyse external finance and also to support the government agenda. With Seychelles being already a good performer in that area, it was an easy choice to pick Seychelles as a pilot country," said Ahokpossi.

The IMF delegation will be in the country until the middle of next week.

"We are going to try and get some agreements. We should have a press conference together with the minister and the governor to give you a flavour of our discussions. After this, we will go back and do our report. Normally the board of the IMF will look at the report, and discuss it for approval sometime in late May or early June," explained Ahokpossi.

Seychelles' Cabinet of Ministers gave its approval for the Ministry of Finance to start negotiations for a new Extended Fund Facility (EFF) with the IMF on March 15. 

Seychelles and the IMF agreed on an economic reform programme under the EFF at the end of July 2021, because of the devastating impact of the COVID-19 pandemic on the country's economy. The agreement is for a 32-month extended arrangement under the EFF for a total sum of $105.63 million.