National Reserves Climb to $878 Million as Central Bank Warns of Global Volatility
The Central Bank of Seychelles (CBS) has reported a significant strengthening of the nation’s financial buffers, with foreign exchange reserves reaching $878 million by the end of 2025. This represents a $104 million increase over the previous year, a growth largely attributed to the CBS’s strategic purchase of $122 million in surplus foreign exchange from domestic commercial banks, alongside financial support from international institutions.
In a detailed presentation to the National Assembly, Governor Caroline Abel, accompanied by deputy governors Brian Commettant and Mike Tirant, outlined the critical role of these reserves in maintaining national stability. Currently, the reserves provide approximately 4.4 months of import cover, which remains above the standard three-month adequacy threshold. However, Governor Abel emphasized that for a small, import-dependent economy like Seychelles, the target remains the Southern African Development Community (SADC) recommendation of six months.
The report further detailed that in 2025, 47.6% of reserve usage was dedicated to the repayment of external debt, while 41.7% funded regular expenditures by ministries and government agencies. The CBS also announced the approval of a “Climate-related Financial Risk Supervision Strategy”. This framework is designed to help the banking sector identify and manage risks posed by extreme weather events and sea-level rise, which the Governor noted can severely damage infrastructure and necessitate unplanned, costly imports for reconstruction.
