IDB and Suriname Sign Agreement to Finance MSMEs

The first operation under the Amazonia Forever program for bio-business in the Caribbean

The Inter-American Development Bank (IDB) agreed on a US$12 million financing support to Suriname to enhance access to credit for micro, small, and medium-sized enterprises (MSMEs), focusing on bio-businesses.

This is the first operation by the IDB for Amazonian bio-businesses in the Caribbean under the Amazonia Forever program — a holistic, regional umbrella program to accelerate sustainable Amazonian development that was launched in June 2023.  

“I am delighted to sign this new agreement with the government of Suriname. It will provide support in the form of investment and working capital to around 500 micro and small businesses focused on climate change adaptation and mitigation in the Amazon, under the Amazonia Forever Program," IDB President Ilan Goldfajn stated during the signing of the agreement at the IDB's XII Annual Caribbean Governor's meeting.

The operation is part of the IDB's Financing Program for Productive and Sustainable Development in Suriname which will help strengthen the institutional capacity of the National Development Bank of Suriname (NOB) to extend credit to MSMEs for working capital and investment in productive projects.  

"The program will contribute to productivity gains in MSMEs by expanding access to finance for productive investments, with an emphasis on bio-businesses. And it is a significant step towards realizing the vast potential of our entrepreneurs and fostering a thriving future for our nation,” said the Minister of Finance and Planning of Suriname, Stanley Raghoebarsing.

The Program is structured around four key components. The first component will focus on enhancing the NOB’s financing capacity for MSMEs through first and second-tier loans. This financing will also include technical assistance to empower entrepreneurs in developing business plans and financial statements. The second component will center on bio-businesses financing, particularly in the agriculture and ecotourism sectors. The third component aims to mitigate the risk perception about this business segment by establishing the Bioeconomy Guarantee Fund. Lastly, the fourth component will be dedicated to NOB’s institutional strengthening, specifically emphasizing bioeconomy matters. 

The program will be funded through an US$8 million investment loan from the IDB's ordinary capital and a US$4 million from the Green Climate Fund's (GCF) Bioeconomy Fund for the Amazon. The GCF funds include a US$2 million loan, and US$2 million of non-reimbursable investment financing for a guarantee fund and technical cooperation. The ordinary capital funds have a 25-year repayment term, a 5.5-year grace period, and an interest rate based on SOFR. Meanwhile, the resources financed through the GCF have a 20-year repayment term, a 5.5-year grace period, and an interest rate also based on SOFR.