Prices of basic foodstuffs and other consumer goods in Syria are spiralling out of control as the government is yet to find practical solutions despite repeated assurances to handle the issue.
According to recent official statistics, Syria’s annual inflation hit 36% in July, triggering a price hike in almost all commodities, while the citizens’ monthly income remained unchanged.
Syria is suffering from crippling economic sanctions imposed by the Arab League, European Union and the United States have imposed sweeping economic sanctions on Syria, including cutting off transactions with the central bank of Syria, imposing a travel ban on officials, halting funding for projects and freezing government’s assets.
The sanctions are choking the Syrian economy and hurting the interests of Syrian people instead of strangling the current regime.
The Western embargo on the Middle Eastern nation has not only increased the prices of imported commodities but also the domestic products. The prices of some foodstuffs have doubled or even tripled since the deadly uprising erupted 20 months ago.
Some Syrian officials and experts have lately appealed to the government to raise wages to keep pace with the rising consumer prices, noting that the middle class has been hit particularly hard by the soaring prices.
However, a recent statement by Syrian Finance Minister Mohammad Jlailati has dashed hopes of any soon increase in salaries in the country, which has been hit by a crunching crisis and whose economy is weighed down by swelling foreign debts, rising inflation and rampant unemployment.
Jlailati reportedly said there are mechanisms to give priority to people with low incomes apart from the salary increase. He said the government’s support might come through an increase in its subsidy for oil derivatives and other consumer items and by providing better health and educational services.
The finance minister indicated that the Syrian market is controlled by monopoly and greed and lacks a fair competition, urging the interior ministry to control the “crazy skyrocketing prices.”
Furthermore, Jlailati noted that the ministry of finance is not against increasing salaries, but has failed to secure resources to cover this increase, adding that this would have negative repercussions.
Jlailati said a salary increase would raise the budget deficit and up the inflation, warning that the purchasing power will also fall and the poor alone will pay the price.
Nevertheless, he said, the decision not to increase salaries is not irreversible, and if it happens, it will be within the government’s capabilities.
He reasserted that the low-income people would be the government’s top priority as most businessmen have already left the country due to the raging crisis.
The Federation of Syrian Chambers of Industry sent recently an urgent letter to the government, requesting a new banking policy to encourage the financing of small and medium-sized enterprises.
The letter urged private and public banks to finance investment in industrial projects and to reconsider the rates of loan interests.
Despite the good offices of the central bank of Syria to maintain the value of Syrian pound, which has been significantly affected by the crisis and lost around 50 percent of its value against U.S. dollar, prices are still soaring and remain unaffordable for many Syrians.
There are reports suggesting that billions of dollars have been smuggled from Syria to Lebanon during the crisis, putting thus further burden on the country’s sluggish economy after over 18 months of unrest.