Suriname and its mining problems...

Happy Monday!

Back to bring you another week of Surinamese news. This week has been long for Rosebel Gold Mines. Also, is the country taking a dangerous leap to overhaul its taxation structure without the right leadership.

Rosebel Gold Mines has had quite the week

Recently there was news about the future sale of Rosebel Gold Mines from Iamgold to Zijin Mining Group. This has led in the past week to conflict between the Rosebel Goldmines Employees' Organization (RGWO) union and the Iamgold. The union wants to be assured that their employees will not lose their jobs and wants to know if there will be a future pension fund as well as inquiring about a bonus due to the sale. The union is concerned that other multinationals that have left Suriname have left employees with nothing and are concerned that the same will happen to the union’s employees. They are also upset with the government for not doing something that will benefit the employees.

The Rosebel Gold Mine is in dire need of investments and the Canadian company, Iamgold has decided as a result to sell their 95% stake in the company Zijin Mining Group, a Chinese mining company. The company announced that no employees will be made redundant as they take over and that they plan to invest heavily in the mine for the future. The Rosebel Gold Mine is expected to have an investment of over US$450 million for the next three years.

Zijin has touted its status as one of the biggest mining companies in the world and its commitment to social responsibility and providing employment to local workers is one of its top priorities. The company has stated that they believe in the mine’s potential and it is counting on the skills of current employees.

Nevertheless, questions and uncertainty linger for the miners while being continuously reassured that their jobs are safe. They've recently upped the negotiations to ask for a golden parachute payment as a bonus for their sale. So questions rise what the union's true motives are.

Suriname will start implementing Value Added Tax from January 1, 2023

From the 1st of January, 2023, Value Added Tax (VAT) will be implemented in the Surinamese economy for goods and services. It is set to start at 10 percent. The VAT concerns companies with more than SRD$ 1 Million in turnover per year.

On Friday, October 21st, 2022, the Ministry of Foreign Affairs, International Business and International Cooperation discussed the implementation of the VAT. The registration of companies under the VAT law will be done digitally and initially, 5,000 companies’ applications are expected. Telesur and Fernandes Autohandel were the first to be registered. VAT has been discussed in Suriname since 1997 and will, according to Acting Minister of Finance and Planning Albert Ramdin, make for generating resources and a more just tax system. The introduction of the VAT also fulfills requirements for the IMF’s debt relief.

The director of Taxation, Ismael Kalaykhan, explained that prices will not necessarily increase and that VAT will promote competition. Further stating that sales tax will be abolished while wage and income taxes will adjust in the future. Despite this, there has been multiple remarks from the business community that Kalaykhan's claims have no basis. People in general are not sure of Kalaykhan's integrity as the director and his ambitions of launching VAT because the tax authority he is the director of has notoriously had issues in setting up their infrastructure. It leads one to wonder whether he is capable of being the director or not. Additionally, there has been rumor of fraud within the tax authority because Kalaykhan still serves as the director of his own consultancy - where many people are led to guide them through the tax system.

A Gambling crisis?

In the midst of the creation of the Lottery Act, members of the Parliament have criticized the popping up of Suribet outlets around the company. As members of parliament state that Suribet’s outlets lead to addiction and destruction of Surinamese youth as well as family disruption.

Parliament member, Cheryll Dijksteel of the VHP, Suriname’s governing party, wants to see the act changed to properly analyse the suffering with regards to Suribet. Furthermore, she also wants to see how the government will earn more money if there is regulation.

The members state that laws on casinos in Suriname are more strict than laws on Suribet outlets. Stating that Suribet does not lead to more employment but rather addiction, poverty, and theft.

A reoccurring theme is around the regulation of the maximum number of betting outlets per district. Many members of parliament have also begun to clammer for the closure of all Suribet outlets.

Member of Parliament Asis Gajadien of the VHP has stated that there are multiple betting companies and has stated that the current phenomenon around Suribet is due to the dire economic situation and that as the situation improves, the better will dissipate. Rather, he believes that there is a lack of parental involvement that leads to this behaviour.

He was met with vocal opposition in his perception of the matter.