The COVID-19 pandemic has highlighted some important issues for Suriname’s private sector, such as the lack of digitalization, financial inclusion, and infrastructure. Suriname’s private sector was already challenged by an unfavourable business climate before COVID-19. There was hope that 2020 would bring some positive changes. Indeed, 2020 brought change, but not the change that was expected: the COVID-19 pandemic exacerbated what was an already precarious socioeconomic situation.
To curb the spread of COVID-19 infections Suriname closed it borders on March 13, 2020. This had a direct impact on tourism. Strict social distancing measures at the onset of the pandemic also constrained the operations of non-essential businesses.
These are the key findings of an Inter-American Development Bank (IDB) survey:
46.6 percent of respondents reported closing their businesses, due either to the authorities’ requirement or the lack of demand.
The IDB online survey found that business closures were highest amongst hotels and restaurants (79 percent), construction (60 percent), and manufacturing (53 percent) sectors. Business closures were also marginally higher for low income households (Figure 1).
Significant income losses were also found for construction and manufacturing (60 percent), trade and ICT (50 percent) sectors, while the tourism sector registered an income loss of 95 to 100 percent, according to a survey conducted by the Suriname Trade and Industry Association in June 2020.
The survey found that Suriname had the lowest percentage of respondents reporting access to bank accounts and debit cards during the COVID-19 pandemic, among the six Caribbean member countries of the IDB (Jamaica, Suriname, Guyana, The Bahamas, Barbados and Trinidad and Tobago). Only 52.2 percent of respondents indicated having access to a bank account (compared to the average of 73 percent of respondents for the region), and an even lower share (29 percent of respondents) had access to a debit card, compared to an average of 70 percent of respondents for the Caribbean countries belonging to the IDB.
Globally, businesses are adapting to the “new normal” of doing business (working remotely whenever possible and ensuring social distancing at the workplace), making adequate infrastructure and digital services extremely important for business continuity, resiliency, and success. To facilitate adaptation to the new normal, there are some important areas that Suriname should continue to advance on:
I. Getting more people online and making progress towards universal internet access can go a long way to help businesses and individuals in Suriname thrive in a post-pandemic world.
II. Digitalization of public services: The pandemic has accelerated many digital transformation processes of public services that were predicted to be more gradual. This trend is likely to yield important benefits in terms of increased savings, greater efficiency and transparency, and a more agile public sector in delivering services.
III. Financial inclusion: The COVID-19 pandemic emphasized the importance of financial inclusion and financial technology services for small businesses and vulnerable sections of society.
IV. Continue to improve infrastructure access and reducing inequalities in access to basic services. This can help to support an inclusive socioeconomic recovery.
Author: Jeetendra Khadan, Suriname Country Economist, Caribbean Country Department, Inter-American Development Bank.
This article has been edited in order to address considerations of space.
