Islamic bank offers billion-dollar loan to SurinameMonday, April 25, 2016
PARAMARIBO, Suriname (CMC) – A delegation from the Islamic Development Bank (ISDB) has ended a fact finding visit here offering Suriname a loan of US$1.75 billion, Finance Minister Gilmore Hoefdraad has announced.
He told reporters that the loan would be extended over a five to 10-year period and would fund projects that will be part of two multi-year development programme.
Hoefdraad said government was considering the loan and that while projects that will be funded through this loan would be taken through a rigorous selection process, funds would immediately be made available to finance imports of social merchandise, such as basic goods and medicines.
It would also furnish a US$60 million injection into the utility company EBS, as well as and infrastructural and agricultural projects.
Hoefdraad said that while the enormity of the loan could be daunting, as it regards 40 per cent of the gross national product (GDP) of Suriname, the money would help the country bridge the economic crisis it is facing.
The crisis has been attributed to the sustained drop in the prices of gold and oil on the world market, which has caused internal reserves to decline. Combined with the closure of bauxite miner Suralco’s alumina refinery in late 2015, pushing the economy into a recession.
The exchange rate for the US dollar has skyrocketed in the past six months, plummeting the local Surinamese dollar to almost half its initial value.
Government has said that is considering seeking support from the World Bank, the Caribbean Development Bank and the International Monetary Fund (IMF) to help it deal with the recession.
The IMF said last week that it would consider an application from the Desi Bouterse government following a visit of an IMF delegation.
Finance Minister Hoefdraad said that the loans would help Suriname through difficult times, after which the economy should have bounced back.
In recent days government has had to deal with several street protests.
Last Friday, while secondary school teachers were ending a one-week strike, several people took to the streets in protest marches and waving anti-government placards in front of the National Assembly building.
The protesters are blaming the government with mismanagement and widespread corruption for the crisis that has pushed the exchange rate for one US dollar to over six Surinamese dollars in six months, and doubling prizes for basic goods in the Dutch-speaking Caribbean Community (Caricom) country.