IMF cuts Seychelles 2014 economic growth to 2.8 pct

Reuters
Visitors are silhouetted against the logo of the International Monetary Fund at the main venue for the IMF and World Bank annual meeting in Tokyo October 10, 2012. REUTERS/Kim Kyung-Hoon

VICTORIA (Reuters) - The International Monetary Fund said Seychelles' economy will grow at 2.8 percent this year, lower than its initial forecast of 3.7 percent, due to weaker demand for the country's main exports. The Indian Ocean archipelago relies on exports of canned tuna and its tourism business for hard currency earnings. A surge in imports, driven by better incomes and access to credit, had put further pressure on the exchange rate, which weakened 11 percent between August and October this year, the IMF said in a statement seen by Reuters on Saturday. It said the central bank's decision to tighten the reserve money target for the fourth quarter will dampen the inflationary effects of the currency's depreciation. The IMF approved the disbursement of $2.4 million to Seychelles, part of a an extended credit facility in June this year, it said in the statement.