In December 2013, the IDB approved a Policy Based Program to support the Development of the Suriname Agricultural sector. This is part of several ongoing initiatives that the country is implementing to gradually but systematically achieve sustained growth in one of its most important non- extractive sectors.
The Agriculture sector accounts for 10% of total export earnings, second to mining, and at the same time consists 17 % of the labor force. Despite its importance, the sector as a whole showed only a 1% annual rate of growth in Total Factor Productivity (TFP) between 2001 and 2007, 41% below the average rate in Latin American and Caribbean (LAC).
Which leads one to question whether sufficient support is being provided to its agriculture sector. In comparision to other countries in the LAC region, the annual level of total financial support to the Surinamese agricultural sector amounts to 1.31% of GDP which is in keeping with the current average among the countries of the LAC region. To deepen their understanding of where to focus its support in the agriculture sector, Government is not only looking at the level of spending in the sector but also taking a closer look on the specific areas and the quality of the support being provided in the sector.
Steeped in best practices and recognizing that public expenditure on agriculture towards the provision of public goods and services (e.g., rural infrastructure, innovation, agricultural health, market information) achieves greater returns and coverage than public expenditures allocated towards the provision of private goods (e.g., purchase and distribution of inputs, subsidies for production).
The loan program will assist the Government of Suriname to strengthen the following critical success areas of the sector: 1) Agriculture Data collection, 2) Animal Plant Health and Food safety, 3) Drainage and Irrigation,4) Agriculture innovation and 5) Fisheries Management.
The strategy behind the loan program is to improve the above mentioned service areas, while at the same time undertake a systematic step by step consolidation of support services areas which will inform relevant funding investments mechanisms designed to foster improved private sector collaboration and performance.
With this approach, Government is confident that Suriname will realize its fullest agricultural potential to become the food basket for the Caribbean.