Inflation in Suriname

A short history of inflation in Suriname

The Commodity Reversal (2015 to 2016)

Suriname's inflation reached 79.1% in the year to October 2016. It is a small economy dependent on gold, oil and bauxite, and all three went against it at once: commodity prices fell from 2014, and Alcoa closed the alumina refinery that had been a mainstay of the economy for decades. The foreign currency those exports earned disappeared, and the Surinamese dollar, which had been held at a fixed rate, was devalued in 2015 and floated in 2016.

Prices for a country that imports most of what it consumes follow the exchange rate closely, so the devaluation passed through quickly and almost in full. The pattern repeated at the start of the 2020s, and the country restructured its foreign debt.

Post-Covid Inflation (2021 to 2023)

In Suriname, prices rose fastest in August 2021, at 74.4%. The causes of the post-Covid inflation were global in nature, beginning with the lockdowns: factories and ports closed and the shipping between them fell out of sequence, so goods took longer to make and longer to arrive. Governments had spent heavily supporting household incomes through those closures, so when restrictions lifted there was money waiting to be spent and not enough on the shelves to spend it on. Then in February 2022 Russia invaded Ukraine, disrupting two of the world's largest suppliers of wheat, fertiliser, oil and gas at once, and the cost of everything grown, heated or transported rose with them.

Because the causes were shared, so was the timing: most countries peaked within a few months of one another in late 2022. The major inflation events covers this episode and the others in more detail.