Economy

Suriname now floats weakened national currency | Financial

From Monday, the official rate may float between 14.29 and 16.30 Surinamese dollar (Srd) for an American dollar. Maurice Roemer of the Central Bank of Suriname announced this on Saturday in Paramaribo.

Five months ago, a few months after the new government led by Chan Santokhi and Ronnie Brunswick took office, the official rate of the national currency had already devalued from Srd 7.52 to Srd 14.29 per US dollar. In practice, exchangers on the black market were already using a rate above SRD 15 per US $.

By opting for a floating course, Suriname is going against the IMF’s proposal. The international financial institution prefers to see Suriname leave the course free to let the market do its work. However, Minister Armand Achaibersing of Finance is convinced that the model that has now been chosen will also yield the desired result. Suriname and the IMF have already been negotiating for several months about financial support of 750 million US dollars for Suriname.

To try to keep the course stable, the government is taking a few more measures. For example, exporters are obliged to pay their income in US dollars or euros to a local bank in Suriname. The advantage of this is that more foreign currency remains in Suriname. This decreases the demand for currency so that the Srd rate can remain more stable. Also, the companies must convert 30 percent of their currency into Srd.

Another measure is that companies can only pay for their purchases with US dollars or euros that are on the account at the local banks in Suriname. This measure must also ensure that more dollars and euros remain in Suriname, so that the exchange rate can remain stable or even become lower, is the hope.

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