“Foreign loans no longer possible”

“The government has gotten itself into trouble with its financial policy,” said MP Chandrikapersad Santokhi (VHP) who added that he has received information that indicates that Suriname can no longer borrow money at low interest rates due to the deteriorating credit rating. Moody’s Investors Service last week placed the B1 long-term issuer rating and senior unsecured notes of the government of Suriname on review for downgrade. The decision to initiate the review for downgrade was prompted by significant deterioration in the government’s fiscal position, as reflected in debt ratios that are at higher levels than previously expected; the likelihood that fiscal reforms will proceed more slowly in the absence of an IMF program and the increasing government liquidity risks because financing has shifted toward short-term domestic debt issuance. The legislator referred to Moody’s review for downgrade as proof. “The government has ended up in a vicious spiral of a debt crisis with its loan policy,” MP Santokhi told Times of Suriname. “Borrowing money abroad is no longer possible and the government recently tried to borrow money via international brokers but failed,” said the legislator who is also the chairman of the Progressive Reform Party (VHP). He explained that the only option left for the government is to borrow money at high interest rates. “The local banks have also reached the ceiling. We are in a serious financial and debt crisis and the government does not know how to get out of this mess,” said MP Santokhi who added that he would certainly discuss the issue in Parliament this week.