Monetary measures for a strong economic climate

Unfortunately, due to decades of poor economic policy in Suriname, resulting in uncontrollable periods of inflation, the economy is not yet as stable as we would like. Until then, we must try to protect and strengthen our SRD with smart interventions. And none of this need be that difficult, because we have large reserves of natural resources, which are still not used to support the SRD. 

On the other hand, it goes without saying that clearing our jungle, polluting our interior with mercury for gold mining and petroleum production, will not bring sustainable development to our country in the long term.

As a country, we must become more aware of the enormous opportunities we have in developing our agriculture, processing our fruit and vegetable products, marketing our cuisine, developing the clothing industry, generating sustainable solar and wind energy. . And using the creativity of the Surinamese entrepreneurs to invent and develop new products. But before we start with this, the emphasis must be placed on stable financial management, in which the (financial) institutions of our country have an important role to play.

One of the institutions that is directly eligible for reform is the Tax and Customs Administration. Strengthening this organization only with ICT measures, without increasing the tax capacity and getting the tax area under control, will not bring about a structural improvement in the country’s income capacity. The deterrent authority and monitoring task of the Tax and Customs Administration must be revived. To achieve this, our tax authorities must be strengthened with a paramilitary Fiscal Intelligence and Investigation Service (FIOD) that will finally gain control over every centimeter of territory in Suriname.

In addition to a monitoring function, a tax authority also has a social function. Part of the income that a well-functioning tax office will generate must be used to make various subsidies available to the poor population. Think of rent allowance, income allowances, transport allowance, child-related subsidies and all other missing facilities that are now causing a lot of poverty in the country. In order to manage this as well as possible, every citizen of Suriname must be assigned a social-fiscal number from birth, so that the tax authorities can provide each citizen with a tailor-made service. Once the tax authorities have been strengthened, we can then focus on suitable monetary measures to make our economy strong again.

Spend new money

In order to regain control over the money supply in the country and skim money from society in a smart way, the government can start issuing new money, so that everyone is obliged to surrender his or her cash balances. With such an action, cashless cash traffic can also be given an incentive by repaying everyone’s money to a bank account. The reinforced tax office will also have to be closely involved in this action, to check the validity of previously declared income tax, to detect tax evasion and to trace black or unfairly earned money.

In the long term, for example, it can also be decided to link the newly issued money directly to our gold stock, thus ensuring that the SRD becomes more stable again. Here too, the role of the tax authorities is extremely important. In a new constellation, all gold concessions will have to be scrutinized again and the disproportionate situations will have to be corrected.

Debt to equity application 

The government, in cooperation with the Central Bank of Suriname, can investigate the possibility of issuing exchangeable bonds in SRD. As a result, many SRDs can be skimmed off from both local banks and society for a longer period of time. These convertible bonds will then have to offer the possibility to be exchanged for company shares after a certain period of time, so that the inflation risk is avoided.

An IPO of Staatsolie could also be investigated. Such an IPO can yield many billions of US dollars to the State in one fell swoop if it succeeds in transferring Staatsolie to a financial exchange. The government could use this money to improve its debt position, but also enable creditors to convert the debt that Suriname now owes them into Staatsolie shares. In this way, the government can smartly reduce or eliminate the country’s debt position.

Ingezonden : Peter M. Wolff

Petermartinwolff@outlook.com