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Reflection on Open Market Operations in Suriname

Exploring the Consequences of Unchecked Money Creation and Financial Decision-Making

Reflection on Open Market Operations in Suriname

Last week, the nation received a shocking revelation in parliament from the Minister of Finance and Planning. The unchecked money creation from the OMO auctions has led to severe disruptions in our economy. Inflation, exchange rate fluctuations, and price hikes are described by monetary authorities as “expensive lessons.” The state, over the people’s backs, has been significantly disadvantaged by abuse of power, fraud, and self-enrichment, amounting to a record SRD 4.5 billion.

Repercussions for the People

To exacerbate matters, the minister announced in parliament that the people would bear the brunt of the costly lessons from this monetary debacle. The governor of the Central Bank of Suriname (CBvS) also stated in a press release that both the bank and the state would bear the losses.

OMO Auctions and Misuse of Funds

Through the OMO auctions, a staggering SRD 4.5 billion in interest has been paid by the CBvS to various commercial banks. Our savings and deposits in banks were improperly used by these institutions to speculate on the OMO auctions. The exorbitant and highly unusual interest rates were pursued solely for their gain, resulting in excessive profits and dividends for shareholders.

Government’s Response and Legal Changes

Despite warnings about the exorbitant interest rates, the government took measures to continue OMO operations. A presidential committee was formed to investigate the auctions. The government allowed the CBvS to print more money to finance these operations. The emergency law was extended until August 2022, and amendments were made to the Banking Act.

Commission’s Findings

The commission’s report, “Reflection on Open Market Operations,” revealed serious allegations of wrongdoing and indicated criminal activities. The OMO interest rates were deemed excessively high, causing substantial losses for the CBvS. The banks, abusing their power, maintained these exorbitant rates, enriching themselves at the expense of the state.

Government’s Disregard for Findings

Despite the damning report, the government, including the president, did not accept the commission’s conclusions. This non-acceptance was accompanied by offers of high positions to two committee members. The CBvS attempted to justify OMO operations in April 2023, further exacerbating public unrest.

Legal Implications and Call for Action

Parliamentarians and experts have pointed out the likelihood of criminal acts, including abuse of power and self-enrichment. The National Assembly, as the highest state body, is urged to take decisive action against this mismanagement. Coalition members must not blindly follow their leaders, and accountability for this financial debacle must be established.

Conclusion

The people are the ultimate victims of this financial mismanagement, as their savings are speculated with, and they face the consequences of expensive lessons. Who will be held responsible for this dire situation remains uncertain, raising questions about accountability and justice.

Marie-Louise Vissers (Advisory, Consultation, and Political Development Bureau Mawini)

Source: https://dwtonline.com/dure-oplichting-van-het-volk-omo-constructie/

Date: 19 December 2023

Categories:  Economic News, Opinions 

Tags:  Attorney General, Banks, Economy, Exchange Rate, Exchange rate increases, Government measures, Inflation, Monetary authorities, Money creation, OMO auctions, Presidential Committee, Price increases, Public Prosecutor's Office, The National Assembly 

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