Seychelles' foreign policy was shaped in the Cold War era and by its strategic position in the Western Indian Ocean. In his first decade and a half as president, René chose to follow a policy of nonalignment. He deliberately tried to distance Seychellois politics from both Western and Eastern influence. René called for a reduced superpower presence in the Indian Ocean by urging the U.S. to remove its Diego Garcia base. During this period, strong ties were retained with the USSR, Cuba, Angola, North Korea, and Tanzania.
In the post-1990 period, Seychelles has improved its relations with the U.S. and Western Europe. In January 1998, the European Development Fund announced that it would finance a $2.7 million waste processing plant, signifying a new economic relationship with Western development agencies. In 2002 Seychelles was set to receive a $3.6 million EU grant over five years, 85% of which was for solid waste management. The Japanese have also taken a greater interest in the islands, committing $25-$30 million per year to finance Seychelles' fishing sector beginning December 2001. While Seychelles does not qualify for Japan's International Cooperation for Africa Fund, which is designated for Africa's poorest 40 countries, Seychelles still provides Japan with permissive policies on whaling in the Indian Ocean. Seychelles exports mainly to the UK, France, Italy, and Germany, and imports mostly from the US, France, Saudi Arabia, South Africa, and Spain.
In January 2002 the UN barred Seychelles—and 19 other states—from voting in the General Assembly until its unpaid arrears to the organization were settled. Seychelles has argued that dues calculated on GDP per head disadvantages it because of its small size. In the case of the Southern Africa Development Council (SADC) for example, Seychelles was granted dues of $240,000 instead of $600,000 annually. The René government may also be faced with an international law suit over its failure to pay the Commonwealth Development Corporation (CDC) its outstanding debts. The government would likely pay off its debt if the matter threatens investor confidence.
In January 2003 Seychelles hosted a SADC meeting of the Interstate Defense and Security Committee (ISDSC) chaired by Tanzania's Major-General Frances Louis. The Seychelles People's Defense Force (SPDF) has maintained close defense relations with Tanzania since René's 1977 coup. Seychelles is also a member of the Common Market for Eastern and Southern Africa (COMESA), but has not joined COMESA's free-trade area launched in 2000.