Fitch upgrades Seychelles

Fitch Ratings said it upgraded Seychelles' long-term foreign-currency issuer default rating to B+ from B.

“Tourism arrivals have rebounded faster than expected since the country reopened its borders in March 2021. Arrivals are on course to reach 70% of the 2019 level by end-2021. Strong vaccination rollout (as of Nov. 8, 78% of the population is fully vaccinated), relatively limited restrictions on tourists (compared with many competing destinations) and the emergence of new tourist markets (e.g. Russia, Israel, UAE and Saudi Arabia) are expected to be supportive of the sector,” Fitch said in a press release.

The robust rebound in economic activity in 2021 and resulting revenue growth will lead to shrinking the budget deficit more quickly than previously expected. “Fitch expects the deficit to shrink from 18.4% of GDP in 2020 to 9.4% in 2021 (previous projection: 11.9%), and average 4.4% in 2022-23 (previously 7.1%).”

The outlook is stable.

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