Skip to Main Navigation

Overview

Suriname is a small, natural-resource rich, upper-middle income country in South America with a population of approximately 623,000. The economy is driven by its abundant natural resources, with mining accounting for nearly half of public sector revenue and gold representing more than three quarters of total exports. This makes Suriname extremely vulnerable to external shocks. Strong economic growth, averaging 4.4%, was recorded from 2001 to 2014, mainly due to favorable commodity prices. This made the country one of the fastest-growing economies in the LAC region with Gross Domestic Product (GDP) per capita rising to nearly US$9,200 and a decline in poverty rates.

However, beginning in 2015, Suriname’s economy contracted, and the budget and balance of payments came under severe distress. Government revenue from mining fell sharply, foreign reserves were drained, and GDP growth contracted. By 2020, a severe fiscal and balance of payments crisis began to unfold in Suriname, which continued into 2021. Domestic vulnerabilities were exacerbated by the COVID-19 pandemic, leading to a sharp GDP contraction (16.0 percent in 2020) and increasing unemployment and poverty. On the UN’s Human Development Index, Suriname ranked 99 out of 191 countries in 2021 at 0.730, which puts the country in the high human development category. Data collected in 2020 suggests that an estimated 26 per cent of the population live in poverty.[1]

Suriname is one of the most vulnerable countries in the world to the impact of flooding. The country is prone to periodic flooding due to heavy rainfall, especially when combined with spring tides. Approximately 87 percent of Suriname’s population lives along the 386 km long coastal plain (around 67 percent in Paramaribo), and flooding affects most of the population and an estimated 90 percent of human activities. Flooding is exacerbated by poor drainage in the relatively highly populated urban areas on the coast, such as the capital city of Paramaribo.

The successful implementation of Suriname's macroeconomic stabilization program is essential for its near-term prospects.  The country started seeing a moderate economic recovery in 2022 with real GDP expanding by 2.4 percent.  However, high inflation and rapid currency depreciation remain major challenges. Successful debt restructuring and adherence to fiscal prudence will help the country restore debt sustainability and economic stability.

The government's ability to function and address the challenges faced by the most impoverished Surinamese will rely on fiscal adjustments within the context of the macroeconomic stabilization program. The discovery of several offshore oil deposits in 2020 could result in positive long-term growth and fiscal prospects for Suriname although production is not expected to start until 2028 at the earliest. However, Suriname's reliance on the oil industry could make it more susceptible to fluctuations in commodity prices and have negative environmental impacts. To minimize these risks and establish a foundation for efficient and equitable management of oil revenues, it will be crucial to strengthen governance institutions and enhance human capital.

 

[1] Republic of Suriname, Common Country Analysis, Final Report, December 2020. publication, p. 7.

Last Updated: Oct 02, 2023

Image
PHOTO GALLERY
More Photos

Additional Resources

Country Office Contacts

Kingston
Penny Bowen