The Central Bank of suriname (Photo: Twitter @Suriname Herald)

Suriname proposes 70 per cent haircut for bondholders

The Central Bank of suriname (Photo: Twitter @Suriname Herald)

Suriname is proposing that bondholders take a 70 per cent nominal haircut in the country’s dollar bonds due in 2023 and 2026, as well as an extension of the maturities and a reduction of coupons as part of a debt-restructuring exercise.

Finance and Planning Minister Armand Achaibersing, speaking at a virtual news conference, said that the haircut would make the new instruments worth about US$236 million, which includes the outstanding principal as well as the accrued interest.

Suriname’s Finance and Planning Minister Armand Achaibersing (Photo: CMC)

The Government said regarding its debt of US$550 million to be repaid in 2026, it is proposing to make the first coupon payment on December 1.

Up to and including June 1, 2025, the Dutch-speaking Caribbean Community (CARICOM) country wants to pay four per cent interest; from June 1, 2025 to June 1, 2028, five per cent interest; and from June 1, 2028 to June 1, 2029 — the last day of payment — six per cent.

It said that annual principal repayment should begin on June 1, 2025 if creditors agree.

Suriname’s $20 note (Photo: Wikipedia)

Achaibersing noted that in 2019, now President Chandrikapersad Santokhi had pointed to the irresponsible borrowing of the then Desi Bouterse government.  The Finance Minister said that the new Government is committed to tackling the debt issue in a holistic manner.

With regard to the debts with bilateral partners, Government has indicated the possibility of a 30 per cent decrease in the nominal value.

President of Suriname Chandrikapersad Santokhi, when he was in Opposition, highlighted the irresponsible borrowing of then-President Desi Bouterse’s Government. (File photo)
Former President of Suriname Desi Bouterse (File photo)

It is proposing to make amortisations from June 1, 2026 to June 1, 2046 with maturities ending between June 1, 2036 and June 1, 2046. These restructured loans will have an average maturity of 15.7 years should the creditors agree.

Achaibersing said that while debt settlement may differ between different types of creditors, the authorities remain committed to the restructuring based on parameters associated with creditor fairness principles.

The Government is in contact with the Paris Club to chart the way forward regarding the handling of claims within its remit, he added.