A set of steps being implemented to manage the currency rate were recently announced by President Chan Santokhi to the National Assembly. The restrictions will remain in effect until December 31, 2023. The police and judicial authorities have been instructed to deal with bureaux de change that operate illegally and with the unlawful exchange of foreign cash. The Public Prosecution Service will serve as the task force’s leader. Also announced is a set of fiscal measures.
The president declared that the leadership of the Central Bank of Suriname (CBvS) is being strengthened in order to tighten monetary policy. With the SRD cash reserve % adjusted, the banking industry’s ability to offer credit is constrained. Bank credit expansion is restricted. These restrictions on large-scale private lending will go into force in April 2023.
In order to give residents an appealing stable-value choice for investing their SRDs, a fixed-value investment instrument, such as the then Powisi certificates, is recommended in addition to the normal open market operations with time deposits and Central Bank certificates.
In order to make it more appealing for savers to save in SRDs rather than escape in foreign currency, the CBvS is collaborating with the banking system to improve interest rate transmission. A tighter watch is being kept over banks and bureaux de change. Stricter rules are being implemented regarding exchange rate margins, the justification and justification of diverging exchange rates, as well as deposits made by bank customers. The goal is to reduce the purchase of foreign currency through unlicensed sources and increase the efficiency of currency transactions. A circular on this will be released by the CBvS at the end of March 2023.
The CBvS and the Ministry of Finance & Planning, the two monetary authorities, have started routine meetings to coordinate monetary and fiscal policy, in part with a view to stabilizing the exchange rate. Government spending from the budget and the CBvS’s liquidity theft are synchronized in particular. If necessary, the relevant working groups’ mandates will be tightened.
The Public Prosecution Service and the CBvS have spoken about measures to stop illegal currency trading. Spreading the operations in secrecy is a significant issue because recent history demonstrates that the illegal currency trade is aware of impending actions in advance. Hence, no criminal activity can be found during raids. The president pointed out that many of the budgetary measures will be extremely well known because practically all of them were recently extensively debated during the budget debate. They want to restructure government and raise money for it. The steps to raise enough money were thoroughly and specifically discussed in the government last week.