Suriname: 2004 Article IV Consultation-Staff Report; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Suriname
IMF Staff Country Reports, April 25, 2005
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- Suriname: 2004 Article IV Consultation-Staff Report; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Suriname
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Bibliographic details
- Published: April 25, 2005
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781451835274.002
Executive summary
- Tighter fiscal and monetary policies in Suriname helped stabilize the exchange rate and moderate inflation pressures in 2003 and 2004.
- The financial system has become increasingly dollarized in recent years, reflecting the lingering effects on confidence of earlier episodes of price instability and regulatory changes favoring foreign currency intermediation.
Key macroeconomic outcomes (2002–2003)
- Fiscal deficit narrowed from 6.5 percent of GDP in 2002 to near balance in 2003.
- Inflation declined from 28 percent in 2002 to 13 percent in 2003.
- Exchange rate: stabilized as a result of tighter fiscal and monetary policies (no numeric exchange rate provided).
Financial sector developments
- Increasing dollarization of the financial system.
- Drivers of dollarization:
- Lingering effects on confidence from earlier episodes of price instability.
- Regulatory changes favoring foreign currency intermediation.
Policy implications and focus areas
- Maintain tight fiscal policy to preserve the narrowing of the fiscal deficit achieved in 2003.
- Continue prudent monetary policy to sustain lower inflation and exchange rate stability.
- Address dollarization-related vulnerabilities by reviewing regulatory frameworks that favor foreign currency intermediation and by implementing measures to restore confidence in domestic currency intermediation.
Source: Suriname: 2004 Article IV Consultation-Staff Report; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Suriname (IMF Staff Country Reports 2005, No. 143).