KINGSTON, Jamaica — The International Monetary Fund (IMF) has issued a stark warning to Suriname, urging immediate fiscal and monetary policy resets to address concerning economic deterioration. Recent policy slippages have reversed stabilization gains achieved under an IMF-supported program concluded in March 2025, pushing public debt beyond 106% of GDP. This backsliding has weakened the national currency, reignited double-digit inflation, and depleted critical government cash reserves.
The warning comes at a pivotal moment for the South American nation, which stands on the brink of a potentially transformative offshore oil boom. The IMF’s Executive Board, concluding its 2025 Article IV consultation, emphasized that a renewed commitment to credible macroeconomic policies and institutional strengthening is paramount to avoid repeating destructive boom-bust cycles of the past.
Current economic indicators reveal significant strain. Economic growth has slowed to an estimated 1.5% in 2025, primarily due to declining gold production. Meanwhile, macroeconomic imbalances have widened dramatically. The current account deficit surpassed 30% of GDP last year, driven largely by imports for offshore oil development—a deficit expected to deepen further with rising investment.
Despite these near-term challenges, medium-term prospects remain robust. Growth is forecast to average 4% through 2028, supported by ongoing oil-field development and stabilized gold output. The commencement of offshore oil production is projected to dramatically accelerate growth, potentially reaching 30% in its first year.
The IMF stressed that these immense upside prospects heighten the cost of current policy mistakes. Directors emphasized that improving the fiscal balance is critical to containing inflation, alleviating foreign-exchange pressures, and rebuilding buffers. They called for significant fiscal adjustment in 2026, including resuming electricity subsidy reductions, restraining public-sector wages, broadening the tax base, and strengthening tax administration through digitalization—all while protecting priority spending on human capital.
On monetary policy, the Fund urged authorities to firmly re-anchor policy around price stability, recommending that reserve money be brought back to target through open-market operations. Directors supported plans for a new monetary policy framework and underscored the importance of exchange-rate flexibility, advising that foreign-exchange intervention be limited to addressing disorderly market conditions.
With massive oil revenues on the horizon, the IMF placed heavy emphasis on governance reform. Directors called for full implementation of recently passed public financial management and sovereign wealth fund laws to ensure transparent handling of future oil revenues. Additional recommendations included amending anti-corruption legislation, operationalizing procurement laws, strengthening oversight of state-owned enterprises, and reinforcing anti-money-laundering frameworks.
The IMF expects to remain closely engaged with Suriname under its post-financing assessment framework, with the next Article IV consultation scheduled on the standard 12-month cycle.