Nickerie.Net, maandag 01 september 2008

Markante cijfers in IMF rapport over Suriname - schatting economische groei op 7 procent

28/08/2008

Paramaribo - Het Internationale Monetaire Fonds (IMF) heeft de nieuwe macro-economische cijfers voor Suriname dinsdag vrijgegeven. Een IMF-delegatie was in april dit jaar in Suriname om economische data te verzamelen. Volgens het instituut zien de vooruitzichten er goed uit. In 2007 is een economische groei van 5 procent gerealiseerd, terwijl de schatting voor dit jaar op 7 procent moet uitkomen.

Behalve deze conclusie zijn alle financiële data over Suriname in een 46 pagina tellend rapport vervat. Alle inkomsten en uitgaven van de centrale overheid zijn hierin terug te vinden, evenals de rol van de verschillende sectoren bij het tot stand komen van het Bruto Nationaal Product. Heel opmerkelijk is dat het brandstofverbruik vanaf 2003 een stijgende lijn vertoond, nadat de overheid de prijs aan de vrije markt losliet in september 2005.

In 2003 werd nog maar 220 miljoen liters aan diesel en gasoline opgereden. In 2007 steeg dat naar 235 miljoen liters voor zowel diesel als gasoline. De lachende derde hierbij is de overheid, die hieraan in 2003 nog maar SRD 107 miljoen verdiende, maar het vorig jaar haar aandeel meer dan zag verdubbelen met SRD 224 miljoen.

Uit de groot en kleinschalige goudmijnbouw ziet de regering haar inkomsten vanaf 2003 gestaag toenemen. In dat jaar bedroeg de export van goud meer dan 11.700 kilogram met een waarde van zeker 128 miljoen US-dollars, terwijl de staat aan royalty's zo een 1,31 miljoen US-dollars heeft ontvangen. Vorig jaar was de export 22.126 kilogram met een waarde van meer dan 482 miljoen US-dollars. De royalty's voor de staat zijn nog niet bekend, maar die zullen meer dan 10 miljoen US-dollars uitvallen. In 2003 was aluinaarde goed voor een 60 procent van de exportopbrengsten, terwijl goud nog maar 25,1 procent daartoe bijdroeg. In 2007 wordt dat voor aluinaarde 47,4 procent, terwijl voor goud dat 35,9 procent wordt.-.

World Bank Statement on Suriname

by Paulo Nogueira Batista, Executive Director for Suriname and Ketleen Florestal, Advisor to Executive Director

June 2, 2008

1. In 2007, prudent macroeconomic management and high commodity prices led to strong GDP growth, a strengthened external position and an important decrease in Suriname’s debt to GDP ratio. Performance was strong in both the mineral and non-mineral sector as evidenced by a significantly lower non-mineral fiscal deficit and the important contribution of agriculture and tourism to growth. At the level of the external sector, the current account surplus rose to 2.9 percent of GDP and official reserves strengthened from two to about three months of imports. The important rise in oil and food prices largely accounted for the rise in inflation from under 5 percent in 2006 to over 8 percent in 2007.

2. This global price shock and associated cost-push factors may exacerbate the impact on inflation of demand pressures in a booming economy in 2008. Nevertheless, our Surinamese authorities do not see the need to tighten credit conditions as yet. They acknowledge that the recent rise in private sector credit must have contributed to rising inflationary pressures and that several investment projects (in mining and infrastructure) are on the verge of being implemented. Moreover, our authorities anticipate possible pressures in the labor market given the potential rise in demand for specialized and skilled labor in certain growing sectors both in Suriname and in neighboring countries. Even so, they believe that the dominant factors behind the inflationary pressures are the global increases in the prices of basic food stuffs and petroleum products. It should be noted also that the aforementioned investment projects rely primarily on imported inputs and thus may have little impact on domestic demand. The timely implementation of these projects remains crucial for achieving growth objectives.

3. Our Surinamese authorities are committed to maintaining macroeconomic stability and most particularly safeguarding the positive fiscal performance, notwithstanding mounting pressures to loosen fiscal policy as a response to the population’s diminishing purchasing power with the rise in basic commodity prices. The upcoming Parliamentary elections (2010) may be an additional source of pressure, which will have to be withstood. One of the key challenges the authorities face is indeed that of addressing the pressing and growing social demands without forsaking fiscal sustainability. These demands include an increase in the old age allowance, a considerable increase in public wages and a decrease in the taxation of fuel. Also, in order to lessen the impact of the global price increases of basic goods on the domestic market and, in conformity with Caricom’s recent ruling on the partial and temporary suspension of the Common External Tariff (CET), tariffs on forty eight goods have been reduced. The inclusion of goods in the suspension list was based on two concerns: the potential impact on the CPI and the potential impact on fiscal revenues.

4. The authorities welcome staff’s suggestion to set a formal medium run target for the non-mineral balance when elaborating the national budget in order to preserve fiscal sustainability. They wish to stress that no concessions will be made that jeopardize fiscal sustainability. They are also appreciative of the information Fund staff has shared on best practices relative to the management of a Natural Resource Funds (NRF). We take this opportunity, on behalf of our Surinamese authorities, to thank Fund management and staff for the conference that was delivered on the topic during the mission. One may want to recall that Fund’s technical support in this field was formally requested on the occasion of last year’s Article IV Board Discussion. The idea of creating a NRF is welcomed by most social and political forces in Suriname. Nevertheless, given that ex ante several key decisions need to be taken, a Natural Resource Fund can only be realistically projected to be put in place in the medium run. These key decisions include defining the objectives of the NRF, i.e., whether the main goal of setting up such a fund would be saving for future generations or stabilizing fiscal revenues or both. Also, the choice on how and where the resources of the fund will be invested is as crucial.

5. Another key element of the medium-term fiscal framework is debt sustainability. Substantial efforts have been made in recent years to decrease the stock of public debt which has successfully been held in recent years well below the established ceiling of 60 percent of GDP. In 2007, the debt to GDP ratio has been held below 25 percent and the authorities agree with staff on the necessity of setting a much lower target than the existing 60 percent ceiling. However, given the investment needs of the country and potential economic downturns in the future, the authorities would want to leave themselves some room for maneuvering and do not wish to consider setting a target ceiling below 30 percent. Concurrently, our Surinamese authorities are committed to decreasing the existing stock of arrears even further by continuing to pursue efforts to reach a suitable agreement on the remaining arrears with Brazil and the United States. Suriname has presented an outline to Brazil on how it proposes to address the issue of restructuring its debt and is now awaiting negotiations with the Brazilian government. As regards the debt with the United States, a deadlock has emerged on the issue of accumulated penalties. Suriname has proposed a bullet payment for principal and interest. But the parties remain divided on how to treat penalties on delayed payments.

6. In the financial sector, reforms of the state-owned banks have borne fruit and helped strengthen the health of the banking sector. Most indicators of financial soundness have improved. The reduction of the level of non-performing loans and particularly in state-owned banks (SOBs) should be underscored. Nevertheless, the authorities recognize that the SOBs remain undercapitalized. In 2007, dollarization was also kept under control close to its 2006 level. The reduction in reserve requirements on domestic currency deposits in early 2007 contributed to achieving this result. Additionally, the authorities view the present level of the exchange rate as adequate. The exchange rate’s relative stability has served as a valuable anchor for expectations.

7. Staff’s has recommended to phase out the partial allocation of reserve requirements to mortgage credit and convert it into direct budget expenditures. In 2008, to address the shortage in availability of low cost housing, the Government is considering to put in place a direct housing subsidy program, which will be financed until 2010 with Central Bank profits. These profits are normally transferred to the Ministry of Finance.

8. Finally, on behalf of the Surinamese authorities, we wish to thank staff for the quality of the dialogue with the authorities and for the candid report. We also wish to thank the Fund for the sustained provision of technical support to Suriname both directly from headquarters and through CARTAC. As a result, a lot of progress is being achieved particularly in the field of public financial management, revenue administration and statistics. Nevertheless, much remains to be done to strengthen institutional capacity. Additional TA to broaden the scope of information that is being collected on state-owned enterprises particularly on debt contracted would be welcome.

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