Middle East

Syria to raise 2013 government spending in face of uprising

Syrian Minister of Finance Mohammad Jleilati attends the opening of an Arab finance ministers "exceptional meeting" in Abu Dhabi on September 7, 2011. AFP PHOTO/KARIM SAHIB

AMMAN: Syria's government said on Wednesday it planned large increases in spending on salaries and subsidies next year, in an apparent effort to retain popular support following a 19-month uprising.

Finance Minister Mohammad Juleilati said spending on salaries was projected to rise 13 percent to 236 billion Syrian pounds ($3.47 billion).

Subsidies on food, fuel and power, and for agriculture, will increase 25 percent to 512 billion pounds in a budget 4 percent larger than this year's at 1.38 trillion.

In remarks carried by the state news agency, the minister said state revenue was expected to fall because of "the world war being launched on us and the sanctions which aim to create imbalances in the Syrian economy".

The rebellion, which is turning into civil war, and Western sanctions on Syria's oil exports have hit the economy hard.

Tourism revenues have collapsed and the country's industrial and trading activity in main cities such as Aleppo and Homs have come to a near-standstill.

Juleilati did not say how large the revenue shortfalls would be or give a figure for Syria's projected budget deficit.

The International Monetary Fund said in September it expected Syria's economy to shrink 2 percent this year, down from a 3 percent growth estimate previously.

With the collapse of the state in many parts of Syria, financiers and businessmen doubt the ability of the government do more than pay salaries to loyalists and finance the military campaign.

Syria has an opaque budget, with delayed settlement procedures and unpublished costs for a myriad of security and paramilitary forces now taking a leading role in defending President Bashar al-Assad.

European Union sanctions include an arms embargo and travel bans and asset freezes on around 50 businesses and 150 people. More than 32,000 people have been killed in the conflict. ($1 = 68 Syrian pounds)





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