👨‍⚖️ No more secondary functions for Parliament members

Happy Monday!

This week we cover the recently passed legislation in parliament, IMF’s positive outlook for Suriname, and critique on the supplementary budget raise.

No more secondary positions for Parliament members after May 25

• Financial provisions for the judiciary, government, and National Assembly were approved with 28 votes in favor, 12 against, and notable amendments influencing BEP's support and NPS's neutral stance.

• The laws prohibit Assembly members from holding secondary positions and extend the pension age for former Assembly members from 55 to 60. Judges will retire at 70, and double salaries for government employees after office terms will be eliminated.

• Government officials can no longer buy State vehicles for minimal cost at the expense of the state, and ministers will not automatically transition into director roles. Care for former ministers, Assembly members, and their families will no longer be state-funded for life.

• Tax-free pensions for judges were removed following protests from NDP and BEP factions, aligning judicial pensions with regular tax laws.

• NDP members criticized the salary increases for Assembly members, highlighting a 230% increase while public sector workers received only 15% raises, amidst poverty and systemic issues.

• NDP demanded proof of cost-saving measures and criticized the lack of detailed discussion, accusing the coalition of prioritizing self-enrichment over societal needs.

• Minister Steven Mac Andrew pledged to address remaining concerns, like vehicle purchases, via state decree, as requested by initiator Asis Gajadien.

• Assembly Chairman Marinus Bee defended the laws as a necessary and bold step to curb systemic abuses and argued that societal burdens for supporting former officials would end.

IMF mission positive about programme evaluation

• Suriname's economy has stabilized under the IMF program, described by Minister Stanley Raghoebarsing as akin to a patient recovering but not yet fully healthy, with completion expected in March 2025.

• The IMF delegation is satisfied with the program's progress, particularly the social programs, though improvements are needed in efficiency, weak institutions, and exchange rate stability.

• Moody's upgraded Suriname's credit rating due to the Final Investment Decision by Total Energies, potentially improving financial market access and reducing borrowing costs.

• Inflation trends showed mixed signals in September 2024: year-on-year inflation dropped to 10.5%, but monthly inflation rose to 0.9% due to exchange rate spikes.

• Economic growth was modest at 0.5% in May 2024, driven by air transport, hospitality, and gold production, while investment rates and banking solvency remained stable.

• Gross international reserves stood at $1.42 billion in August 2024, with an import cover of 6.7 months, while the debt-to-GDP ratio rose to 78.2%.

• SEOB reported that 62.6% of IMF program measures were implemented by mid-October 2024, with the SRD money supply slightly exceeding targets due to reduced open market operations.

• The IMF program is viewed as challenging but necessary, with hopes that the final evaluation in February 2025 will affirm its success, marking Suriname's first-ever program completion.

Salary increase main reason for supplementary budget

• The supplementary budget emphasizes wage and salary adjustments, with some ministries experiencing substantial increases, such as 25% in Regional Development and Sports and 40% in Finance.

• Civil servant salaries increased by 15%, funded through budget-neutral financing, with total expenditures rising by SRD 1.48 million but no change in total receipts, maintaining a deficit of 4%.

• SRD 20 billion allocated to the social program represents a third of the budget, but concerns were raised about the exchange rate and additional revenues like SRD 150 million from land conversion.

• Criticism emerged over the government's inconsistency in attributing exchange rate fluctuations, praising its own policies during rate drops but blaming exporters for increases.

• Stephen Tsang linked the supplementary budget to the prosecution of former minister Gillmore Hoefdraad, arguing that using funds for wages and subsidies should not be deemed embezzlement.

• Minister Raghoebarsing acknowledged that funds intended for wages and allowances have been depleted for the year, and SRD 934 million meant for debt repayment was redirected to wages, sparking legal and ethical concerns.

• Tsang emphasized that the use of redirected funds mirrors actions for which Hoefdraad was prosecuted, questioning the fairness and precedent this sets for policymaking.

• The debate raised broader concerns about budget transparency, shifts in income and expenditure, and the legality of fund reallocations, with government responses pending.