The Islamic Post Blog

Syria Reports Three Year Drought by ipinfo2
March 25, 2009, 5:56 am
Filed under: March Volume 2009, World | Tags:

A record three-year drought that has decimated the agriculture sector –which accounts for 23 percent of Syria’s gross domestic product (GDP)– is compounding the country’s economic woes this month. There have been thousands of job losses.
“If the Syrian economy slows down while the drought of the past few years continues, then the situation will be difficult,” said Finance Minister Mohammed al-Hussein in January.
Nabil Sukkar, managing director of the Syrian Consulting Bureau for Development and Investment, said the drought could pose a bigger threat than the global financial crisis. “The drought adds to the misery of less income and less spending, and this affects economic growth.”
Hani Tarabishi, a business consultant and professor of marketing and entrepreneurship at Kalamoun University just outside Damascus, said he expected the price of meat to “sky-rocket” this year as a consequence of the drought.
The recent opening up to international markets of Syria’s centrally planned economy has left it badly exposed to the global economic downturn.
“It is very bad”, said Mahmoud Ashi, a wholesale textile producer in Damascus’s ancient Souq al-Hamadiya. “People are afraid to buy goods. It’s the worst economic time in the 15 years I have had this shop. Trade is down 50 percent on last year [2008].”
Many of the country’s leading industries are hemorrhaging jobs as orders from key marketplaces in Europe dry up, leaving families struggling to meet the rising cost of living. Syria last experienced severe economic turbulence in the 1980s when inflation led to bread queues.
Industries struggle.
The textile industry, one of the country’s leading exports, has been particularly hard hit. Jamal al-Omar, director of the Public Institute for Textiles, recently told a closed meeting of industrialists that exports for the last quarter of 2008 had seen a year on year decrease of 75 percent. Industry accounts for some 28 percent of the gross domestic product (GDP).
Reports in some Arab newspapers said 80 textile factories had closed down in recent months, though this was not reported locally.
For textile workers the effect is twofold: “The number of shifts are down for the workers, and there is no overtime,” said Kinan Bahnassi, head of the Labour Market Database Project at the UN Development Project (UNDP) in Damascus.
The electronic and electrical goods industry is also suffering. Representatives have reported exports decreasing by 55 percent since the start of 2009 and expect a further decrease of 25 percent in the coming months as orders from Europe are cancelled.
Cham Holdings, an investment company; Syriatel, the mobile phone telecommunications company; and Katakit, a food and beverages company, are all downsizing.
Inflation tripled from 5 to 15 percent between 2007 and 2008 according to the International Monetary Fund (IMF).           (Source: Irin News)


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