Tuesday, Oct 24, 2017
Government | South America | Suriname

The Land of Vast Resources


3 years ago

Subhas Mungra, Ambassador of the Republic of Suriname to the United States of America
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Subhas Mungra

Ambassador of the Republic of Suriname to the United States of America

United World interviewed Ambassador of the Republic of Suriname to the United States, Subhas Mungra; the team asked Ambassador Mungra about Suriname’s economic diversification, the country’s relations with the United States, and advice for American investors interested in the country. Ambassador Mungra claimed that Suriname’s priority is economic diversification and that relations between Suriname and the US were strong and becoming stronger. Ambassador Mungra also highlighted the most interesting sectors for foreign investors looking into Suriname.

The last time United World did a report on Suriname was in 2012, almost three years have now passed, and during that time you have remained the Ambassador to the United States. In our last report you said that the relations between the US and Suriname were excellent. What are some of the key developments since our last report?

In the past two years our relations have centered on economy, trade and FDI’s. Relations, especially in the mining sector, have intensified. The dominant sector today, in terms of export revenue, is gold mining, and US based companies will continue to play an important role in this sector during the next decade. Last month the government agreed to jointly establish a new gold mine and refinery company with the US based Newmont Mining Corporation. The total investment is $1.1 billion and the government of Suriname will take a 25% share in the new gold mining company. This is a major investment for the country, equivalent to approximately 20% of GDP.

Oil has also enhanced Suriname-US relations; the state oil company has been authorized to enter into business with foreign oil, drilling and exploration companies. Many US oil companies, such as Chevron and Apache Corporation, already have a memorandum of understanding signed with the State Oil Company. They are basically exploring the possibility of offshore oil exploitation on a commercial base. US companies are also important for the State Oil Company’s expansion of their existing oil refinery, which is another $700 million investment. The majority of the companies that are supplying the inputs for the refinery expansion, the distribution system and production fields are US based.

Suriname has also enhanced cooperation in terms of security; the country now participates in the regional security system, which is supported by the US government. Suriname is working closely with the Department of Defense and the DEA to combat the illegal trafficking of persons and drugs. Additionally, Suriname entered into a cooperation agreement with the US army’s Southern Command to receive humanitarian services, and for soldiers from the US to come to the country for jungle training and to train Suriname’s army personnel.

Another sector that is becoming increasingly interesting for US entrepreneurs is infrastructure. Suriname understands that although we have one of the highest growth figures in the Caribbean of 5.5% real growth annually, to further increase production we need to increase our productivity and competitiveness. In this context the government is stepping up its investments in infrastructure, transport, higher education and health. To facilitate US business the government has recently signed a new bilateral “open skies” agreement for aviation with the USA.

In the field of education the University of Texas has a cooperation agreement with Suriname University’s geology sciences department, and there is also an agreement in the field of agriculture with New Orleans University. Another area where we are building a stronger relationship is tourism; we have introduced a new visa on arrival system for short stays and holidays to be applicable for most countries in the world that are interested in doing business with Suriname.

The last time I was here we were talking about Suriname’s diaspora, which is largely in the Netherlands. However, in terms of geography the US is looking more and more important. Where is the diaspora located in the US?

The majority live in Miami, and in New York; it is becoming an important market for our country because 2 to 3 million people from the Caribbean live in the US and they consume, more or less, the same products that we do. The language is never a barrier for business people or tourism because in Suriname everyone speaks English; this is because they teach it in school, and all the TV stations are in English, without translation, forcing the viewer to self-interpret the text.   

Why do you believe the American public should be looking at Suriname?

The country is ideally situated from a geographical point of view as a “gateway” to Latin America and the Caribbean, as well as to Europe with daily air-connections and frequent shipping. Furthermore, Suriname is known for its abundance in natural resources, such as gold, oil, kaolin, building material etc.

In Suriname there are many business opportunities because we have plenty of water, sun, and arable land; only 10 % of the land is inhabited and the other 90% is pristine tropical rainforest.  When you come to the Guianas you have the same nice weather as the rest of the Caribbean, but without the crowd, and that is why tourism has been picking up during recent years. In agriculture we have enough water to grow palm oil, rice, and other crops. Chinese investors are already investing in the country’s palm oil production and we produce approximately 50,000 tons of rice per year, with exports to Brazil, Venezuela and the Caribbean. The State Oil Company is set to produce ethanol from sugar cane, and they have started a new plantation to produce biofuels that are more environmentally friendly. There is a huge demand for solar energy in neighboring countries like Brazil and French Guyana; Suriname would be a great location to produce solar energy because there is much sun throughout the year.

We are also committed to adding value, Suriname is going to process all the gold extracted in the country with its state of the art gold refinery, which is being built by a company from Dubai; this will most likely be finished by the end of the year. Investors from Dubai have also taken over the biggest port operators, immediately renovating the container terminals; this is the second year that Suriname has been awarded in the Caribbean region for the modernity of its port facilities. The government of Suriname has also approved a Chinese project to build a $50 million factory that will produce enough housing material to build 2000 houses annually. China recently announced that Suriname is to become one of their trade centers for the Caribbean.

Suriname wants to increase its cooperation with the US because it leads the way in terms of innovation, and as the world’s largest economy, the Caribbean cannot prosper if it does not increase its cooperation with the rest of the world. In terms of Suriname’s competitiveness there are a number of reasons why US investors should look at Suriname; foremost among them, the government of Suriname has a stable political leadership. From an economic point of view a country can have everything from natural resources, skilled people, and land, but if there is no trustworthy national leadership, there will be no long-term and sustainable development in that country. In this respect Suriname excels; President Désire Bouterse has a long-term development vision partnering with government, the private sector and the labor unions. Unlike some of our Caribbean neighbors, we do not have business security problems such as kidnappings. Ethnically speaking Suriname has a very diverse culture that produces a necessary degree of tolerance and respect of each other’s religious beliefs and values.

The OECD recently produced a study that said Latin America and the Caribbean countries are facing head winds associated with declining trade, moderation in commodity prices, and increasing uncertainty with existing financial conditions. The study suggested innovation, diversification, and better logistics would be key to the Caribbean’s future. How is Suriname working towards innovation and diversification?

I could not agree more that we are facing harder times in terms of volatile commodity prices, and development; our response to this trend is economic diversification, which is the priority of the 2014-2016 National Development Plan. The mining sector should be given priority for public investment and FDI’s. In order to encourage the development of the domestic private sector, the primary focus is on agriculture, tourism, construction and energy. Investments in infrastructure and education are becoming more and more important in order to compete in a globalized world. In terms of energy, Suriname has one of the lowest energy prices per watt unit in the Caribbean, but there is always room for further improvement because the demand is increasing. Suriname also has a state of the art internet communication facilities since the government, some 10-15 years ago, transformed the government telecommunication center into a semipublic enterprise so that the company can make their own investments and policy choices. Whilst there are challenges ahead I am confident that we are in a good position to deal with them, we have one of the lowest public debts in the region; approximately 20% of GDP.

You once said, “Suriname’s economic strength in the region will boost CARICOM’s economic integration in a globalized world and bring new life and solidarity to the Caribbean partnership.”

That was based on an interesting remark made by the Nobel Prize winner, Sriddath Ramphal. Suriname was a latecomer to the Caribbean community, only integrating in 1996. The new economic contribution Suriname made as one of the lager Caribbean Nations at that time, contribute to the enhancing of the Caribbean community’s intra-regional cooperation. The current leadership in Suriname has introduced a new dimension in the foreign policy of the country, our current Minister of Foreign Affairs, Winston Lackin, has substantially increased our participation within the Caribbean, Central America and South America. Currently, Suriname’s President, is chairing the Union of South American States (UNASUR). We have recently increased our bilateral relations with Brazil, Ecuador, Argentina, and Venezuela within our own continent.

What is the most important message on Suriname you would like to communicate to our readers?

The companies that make use of all the new opportunities available in Suriname will progress faster than those who are bystanders. There are a lot of business opportunities in the Caribbean as a whole, but especially in Suriname, because of the business approach of the government. We share almost the same economic goals as the Obama administration namely, job creation, export promotion and quality economic growth that respect the environment. We are always looking into new ways of enhancing bilateral trade. The 2008 Global Financial Crisis did not hit Suriname, so it has the potential to contribute to the recovery of the rest of the world, and to help with the resumption of economic growth. Unfortunately, Europe’s economy is still suffering and now with the situation in Russia we do not know what the future holds. I think that the US is very lucky with the shale gas revolution; it is time to embrace a closer partnership with the US in the area of energy cooperation. Last but not least, Suriname has well-disciplined labor unions that prioritize employment creation and maintenance above higher nominal wages.



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