IMF Executive Board Completes Fourth Review Under the Extended Fund Facility Arrangement for Suriname
IMF News, December 15, 2023
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- Published: December 15, 2023
Review outcome and financing decisions
- The Executive Board completed the fourth review under the Extended Fund Facility (EFF) arrangement for Suriname, allowing an immediate purchase equivalent to SDR 39.4 million (about US$ 53 million).
- The Board approved the authorities’ request for an extension of the arrangement until March 2025.
- The Board approved an augmentation of access equivalent to SDR 46.8 million (about US$ 63 million).
- Total purchase under the EFF arrangement following this review reached SDR 197 million (about US$263 million).
- With the augmentation, the total access expected under the EFF arrangement is SDR 430.7 million (about US$ 577 million).
Economic stabilization and policy priorities
- Fiscal discipline and tight monetary policy are delivering stability: the economy is growing, inflation is declining, and investor confidence is returning.
- Authorities completed a private debt exchange and are close to concluding agreements with remaining creditors.
- Near-term priorities for the authorities:
- Maintain fiscal prudence while protecting the most vulnerable.
- Preserve structural reform momentum and avoid policy backtracking.
- Ensure the 2025 budget is consistent with the 3.5 percent of GDP primary balance target (medium-term debt sustainability anchor).
Program objectives and reform agenda
- The EFF-supported program aims to:
- Restore fiscal and debt sustainability through fiscal consolidation and debt restructuring.
- Protect the vulnerable by expanding social protection.
- Upgrade the monetary and exchange rate policy framework.
- Address financial sector vulnerabilities.
- Advance anti-corruption and governance reforms.
- Noted reforms already implemented:
- Complete elimination of fuel subsidies.
- Gradual phasing out of electricity subsidies.
- Curtailing wage payments to unregistered public servants.
- Broadening the VAT base.
- Monetary and financial sector actions:
- Monetary policy stance described as appropriately tight, helping ease inflationary pressures.
- Commitment to a flexible, market-determined exchange rate is supporting accumulation of international reserves.
- Swift implementation of the new Central Bank Act and finalization of its recapitalization plan recommended to strengthen operational independence and financial autonomy.
- Continued actions needed to address banking system vulnerabilities, including stronger oversight and finalizing assessment of the government-owned bank’s recapitalization plan.
- Governance and institutional priorities:
- Continue structural reforms to strengthen institutions, governance, and data quality with capacity-building support from the Fund and development partners.
- Pursue measures to strengthen anti-corruption and AML/CFT frameworks and ensure alignment with international standards.
Highlights from the Executive Board statement (Kenji Okamura, Deputy Managing Director and Acting Chair)
- Authorities have shown continued commitment to fiscal discipline and macroeconomic stabilization under the EFF-supported program.
- The economy is stabilizing, pressures on the exchange rate have eased, and inflation is on a downward trend.
- A more gradual path of fiscal consolidation than planned at the previous review will:
- Help protect the still fragile recovery.
- Increase support for the poor and vulnerable.
- Prevent further erosion in real wages for registered civil servants.
- Scale up growth-enhancing investment.
- Excellent progress noted on debt restructuring:
- Debt exchange with private bondholders finalized with high participation rate.
- Agreement in principle at the technical level reached with Exim China and is under internal approval process for signature.
Selected Economic Indicators (annual percentage change, unless otherwise indicated)
- Real GDP Growth:
- 2022: 2.4
- 2023: 2.1
- 2024 (Proj.): 3.0
- Nominal GDP Growth:
- 2022: 47.3
- 2023: 55.9
- 2024 (Proj.): 22.5
- Consumer prices (end of period):
- 2022: 54.6
- 2023: 39.3
- 2024 (Proj.): 14.9
- Consumer prices (period average):
- 2022: 52.4
- 2023: 52.9
- 2024 (Proj.): 21.1
- Broad money:
- 2022: 45.1
- 2023: 22.8
- 2024 (Proj.): 14.0
- Private sector credit:
- 2022: 65.7
- 2023: 26.1
- 2024 (Proj.): 13.8
Selected fiscal and debt indicators (In percent of GDP, unless otherwise indicated)
- Revenue and grants:
- 2022: 26.8
- 2023: 25.7
- 2024 (Proj.): 25.4
- Of which: Mineral revenue:
- 2022: 14.3
- 2023: 10.8
- 2024 (Proj.): 9.9
- Total expenditure:
- 2022: 29.5
- 2023: 26.7
- 2024 (Proj.): 26.5
- Overall Balance (Net lending/borrowing):
- 2022: -2.7
- 2023: -1.0
- 2024 (Proj.): -1.1
- Primary Balance:
- 2022: 1.0
- 2023: 1.6
- 2024 (Proj.): 2.7
- Central government debt:
- 2022: 115.1
- 2023: 87.1
- 2024 (Proj.): 92.1
- Domestic debt:
- 2022: 27.4
- 2023: 18.0
- 2024 (Proj.): 18.0
- External debt:
- 2022: 87.7
- 2023: 73.2
- 2024 (Proj.): 74.1
External sector and reserves
- Current account balance:
- 2022: 2.3
- Capital and financial account:
- 2022: 10.6
- 2023: 5.5
- Gross international reserves (US$ millions):
- 2022: 1,195
- 2023: 1,196
- 2024 (Proj.): 1,464
- In months of imports:
- 2022: 6.4
- 2023: 7.6
- Usable gross international reserves (US$ millions) 1/:
- 2022: 865
- 2023: 962
- 2024 (Proj.): 1,230
- Usable reserves in months of imports:
- 2022: 4.6
- 2023: 5.1
- Official exchange rate (SRD per US$, (Average):
- 2022: 24.6
Sources: Suriname authorities; IMF staff estimates and projections.
IMF Communications Department — Press Release No. 23/456 (December 15, 2023).