CBS governor presents annual report to President Ramkalawan |01 April 2023
The Governor of Central Bank of Seychelles (CBS) Caroline Abel presented the bank’s annual report 2022 to President Wavel Ramkalawan yesterday at State House.
This presentation is done every year before the end of the first three months.
The publication includes a certified copy of CBS’ Financial Statements and Auditor’s Report for the year ending December 31, 2022, which is based on the outcome of an independent assessment by Deloitte Touche Tohmatsu Limited (South Africa) on behalf of the Auditor General, as per section 19 of the Auditor General Act, 2010, read with Section 47(3) of the CBS Act, 2004.
The Annual Report 2022 provides an overview of developments across the various sectors of the Seychelles economy during the year, including the country’s interactions with the rest of the world and economic relations with our main development partners.
“A new component we added is the CBS’ Access to Information Annual Report 2022. This addition is as per the Access to Information Act, 2018, Section 54(3), which states that Public Bodies shall incorporate the annual report submitted to the Information Commission under this Act into their annual reports submitted to the National Assembly,” shared Ms Abel.
The report highlights the stronger-than-expected growth in domestic economic activity supported by the robust performance of the tourism sector. This was despite the global challenges brought about by the conflict in Ukraine, elevated commodity prices and tighter monetary conditions externally.
The strong growth in tourism activity resulted in sustained inflows of foreign exchange, which led to a stronger domestic currency and underpinned the moderation in inflation for the year.
However, given the persistent global uncertainties and mindful of the country’s vulnerability to external shocks, CBS continued to support the economy by maintaining an accommodative monetary policy stance throughout the year.
As customary, CBS has also published the 2022 International Reserves Management Report – its eight edition. This is in line with international best practices and the values of accountability, transparency and integrity upheld by CBS.
The report provides an overview of the governance and operational arrangements, which support the efficient management of the country's international reserves.
It also reviews developments and major challenges faced in the area of international reserves management for the year 2022 and provides an outlook on the main aims of the reserves management function for 2023.
Gross International Reserves fell from US $702 million end 2021 to US $639 million end 2022, representing a contraction of 9.0 per cent. In net terms, the level of international reserves decreased by 11 per cent to stand at US $472 million.
Regardless of the decline, the Net International Reserves level surpassed the end of year target of US $426 million, as agreed to under the Extended Fund Facility programme supported by the International Monetary Fund (IMF).
In terms of the country’s international reserves adequacy, with the reduction in the country's level of reserves and a general increase in the level of imports over the period, the months of imports coverage decreased from 4.8 months to 3.6 months in 2022, which is still above the 3 months minimum cover specified by the IMF.
Current situation of the country
“In 2022, the economy grew from 2021 but we were also faced with new challenges by the war and how Seychelles absorbed these challenges. In 2022 our policies were relaxed and even for this year the way the world is going we are keeping our monetary reserve relaxed. For this year, prognostic is to have an economy that will keep growing but will slow down due to global economic landscape. In general, the economy is positive but we bear in mind other factors that can happen and shake the economy,” added Ms Abel.
Usually, shared the Governor, the report does not include recommendations. “Right now the economy is doing well but if there are major changes in the world, then the Ministry of Finance and the CBS will have to come together to announce further measures. Soon the International Monetary Fund will announce the forecast on how the economy will be performing.”
Governor Abel clarified that our reserve is kept in dollars, euros, pound sterling, Chinese yen, Australian dollar and Canadian dollar and the decision on which currency the CBS will keep its reserve is based on an analysis done every year and in what currency is our debt.
Photo by Joena Meme