Seychelles

Seychelles demonstrates how island microstates can achieve high-income status through extreme tourism specialization combined with oceanic resource stewardship. Tourism directly employs 26% of the labor force and contributes over 55% of GDP, making this 115-island archipelago an obligate symbiont with global travel demand. The economy grew 2.9% in 2024, with 3.2% projected for 2025—though revised down from 4.3% due to weaker European tourism markets. Fiscal consolidation continued for a fourth year, achieving a 3.2% primary surplus in 2024. The IMF approved a $13.7 million disbursement under Extended Fund Facility arrangements in 2025, recognizing the country's blue economy strategy as innovative climate-resilient financing. Fisheries remain the second-largest export earner after tourism, and the government has positioned marine conservation as both environmental necessity and economic strategy. Inflation rose to 1.7% in December 2024 after 2023 deflation, moderating to 0.5% by mid-2025 following electricity tariff cuts. Public debt at approximately 60% of GDP and a current account deficit of 7.9% reflect the structural costs of import dependency and infrastructure investment. Gross reserves reached $774 million (3.8 months import cover). The fundamental tension persists: high per-capita income ($17,000+) coexists with productivity challenges and vulnerability to external shocks that any small, remote economy faces.