Seychelles

The Republic of Seychelles is an archipelago of 115 islands northeast of Madagascar. The country has a total population of 122,730 people, three-quarters of whom live on the main island of Mahé. Seychelles has Africa's highest gross domestic product (GDP) per capita, at $17.9 billion (2024). Its economy is highly dependent on tourism and fisheries, and climate change poses long-term sustainability risks.

Independent since 1976, Seychelles is a relatively young democracy. The first multiparty presidential election was held in 1993 after adopting a new constitution.

Seychelles held general elections on September 25–27, 2025, covering both the presidency and the National Assembly. In the presidential race, opposition leader Patrick Herminie (United Seychelles) was elected,  over incumbent Wavel Ramkalawan (Linyon Demokratik Seselwa – LDS). United Seychelles also secured a majority in the National Assembly, gaining both constituency and proportional seats.

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Seychelles has the highest GNI per capita in Africa. Its economy relies on tourism, fisheries, and supporting activities. Since 2008, macroeconomic and structural reforms have supported development. Real GDP growth is estimated to have accelerated to 5.8% in 2025, up from 3.4% in 2024, driven by record tourism earnings and a 13% increase in visitor arrivals that surpassed the pre-pandemic peak of 2019. Fiscal consolidation continued for a fifth consecutive year, with the government achieving a primary surplus of 1.8% of GDP, while gross international reserves rose to $878 million in December 2025, equivalent to approximately four months of import cover. Inflation remained subdued at 0.3%, reflecting lower utility tariffs, fuel prices, and freight costs.

However, growth slowed during the first half of 2026, as reliance on Middle Eastern aviation hubs increased Seychelles’ exposure to conflict-related flight disruptions, with visitor arrivals falling by 11% year-on-year.

In May 2026, Seychelles completed a 26-month IMF-supported Extended Fund Facility and Resilience and Sustainability Facility (EFF/RSF) Program, which supported revenue mobilization, debt management, financial stability, and climate resilience. Performance under the program was strong, with Seychelles exceeding many of the original program objectives.

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Despite its high-income status, Seychelles remains vulnerable to external and climate shocks due to its small size, remoteness, and limited economic diversification. While unemployment is low at 2.6% and extreme poverty largely eliminated, labor and skills shortages and persistent social vulnerabilities continue to constrain human capital development.

Sustaining Seychelles’ high-income status will require a new growth model centered on higher productivity and better jobs. The Country Growth and Jobs Report (CGJR) finds that population aging, skills shortages, labor and business constraints, and lagging digital adoption are limiting productivity and private-sector dynamism. A comprehensive reform package could increase GDP by 13% by 2040, create 2,900 additional jobs, generate the equivalent of more than 7,600 better-paying jobs, and raise real wages by nearly 8%. The CGJR identifies three priorities: modernizing the labor market and business environment; making better use of Seychelles’ human capital by strengthening skills and pathways from school to work; and accelerating digital transformation across businesses and government.

Climate change is a central development challenge. The Country Climate and Development Report finds that, without action, climate and environmental pressures could reduce GDP by more than 6% by 2050 and strain public finances. The CCDR outlines three priorities: reorienting key sectors toward higher value and resilience; reducing exposure to economic and physical risks; and reinforcing fiscal and institutional foundations.

In the near term, priorities include maintaining debt sustainability and reforming the social protection system to support the most vulnerable. Over the medium term, revenue mobilization, climate-resilient public investment, improved public financial management and structural reforms will be critical to creating fiscal space and supporting long-term sustainable development.

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The World Bank Group (WBG) strategy in Seychelles, outlined in the Country Partnership Framework (CPF) FY25-FY30, supports the country's transition to a more inclusive, resilient, and sustainable development path. The CPF focuses on improving quality of life by creating employment opportunities—especially for youth and women—enhancing the business environment for SMEs and entrepreneurs and strengthening human capital through education and skills development. The strategy also promotes the digital economy, climate resilience, renewable energy, and sustainable waste management, while supporting public service digitalization. The WBG aims to bolster social and environmental resilience through policies addressing climate change and solid waste.

A cross-cutting theme is macro-fiscal resilience, supporting Seychelles' commitment to macroeconomic prudence and efficient public resource use to promote economic, social, and environmental resilience. Key strategies include advancing skills development, digital economy, and renewable energy.

The World Bank portfolio in Seychelles stands at $80 million (national projects and budget support) as of August 2025.

In partnership with the government, the World Bank launched a Solid Waste Management Project to improve sector performance, promote circularity, and strengthen Seychelles’ social protection system. Under the CPF, it approved the Sustainable and Inclusive Growth Development Policy Operations (2024 and 2026), Renewable Energy Acceleration Project (2025), and Regional Emergency Preparedness and Access to Inclusive Recovery Program (REPAIR) (2025).

The WBG has launched the Seychelles Country Climate and Development Report and Country Growth and Jobs Report with the Government. Together, these studies present the World Bank’s most comprehensive assessment of how Seychelles can build a productive, diversified, and resilient economy, while managing the risks and opportunities posed by climate change.

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The World Bank’s  Development Policy Operation  in Seychelles delivered key reforms enhancing financial stability, fiscal transparency, and environmental/social resilience. Through the Fiscal Sustainability and Climate Resilience DPF series ($75 million) and Sustainable and Inclusive Growth DPO series ($45 million), the government enacted the Financial Stability Act, adopted risk-based supervision, advanced renewable energy via the Electricity Act and associated regulations, and improved tax transparency with rules on Beneficial Ownership and related-party dealings and transfer pricing. Environmental resilience was boosted through the Tourism Environmental Sustainability Levy, updated Land use Plans, and coastal/fisheries protection. Data protection and financial infrastructure were strengthened via the Data Protection Bill, National Payment System Amendment Act, and Credit Reporting Act. ICT competition improved with the creation of the Seychelles Communications Regulatory Authority. Fiscal management progressed with zero-based costing, reducing non-wage deviations. Social protection reforms expanded coverage, nearly doubling real spending and increasing female beneficiaries.

Social Protection: The Bank supported raising the public sector retirement age and adopting a plan to adjust pension benefits. The WHO Disability Assessment System was adopted for better targeting and services.

Solid Waste Management: Seychelles faces structural waste challenges. The Solid Waste Management Project supports landfill expansion at Providence, feasibility studies for future technologies, and circularity roadmap implementation. The Bank also supported policies on Extended Producer Responsibility, Solid Waste (2025–2030), Hazardous Chemicals/Waste (2024–2029), and the Hazardous Chemicals Bill (2025).

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