Damascus- Merchants in areas controlled by the Syrian regime have been suffering from great challenges and difficulties to maintain their businesses and trade under the weight of economic and legal pressures for years, which has forced some of them to abandon their trade and withdraw from the market to preserve capital.
Syrian markets are witnessing the worst commercial reality since the beginning of the economic crisis in the country about 12 years ago, due to the stagnation controlling the buying and selling movement, the decline in the purchasing power of Syrians, and the restrictions imposed by economic laws on merchants.
Muhammad (47 years old), a clothing merchant in the Harika market in Damascus, says, “Difficult times are passing for merchants in Damascus markets with the lack of sales activity.”
He added in an interview with Al Jazeera Net, “We cannot talk about healthy trade without talking about reasonable purchasing power for citizens. If the customer is unable to buy the commodity, no government solution will help the merchants.”
Muhammad considered that the “lack of purchasing power” of Syrians is the most prominent reason for the stagnation in Damascus markets, especially since the average salaries of employees do not exceed 250 thousand liras ($18), which is barely enough to buy the ingredients for two or three meals.
The Damascene trader points to another reason for the crisis related to the high prices of locally manufactured goods. He says, “The factories bear all the added costs of electricity and fuel for their goods, and most of them are expensive imported raw materials, and all of this eats away at the profit margin that we, the merchants, set, which today has become a small margin.” “Very much compared to previous years.”
Merchants in Damascus and other regime-controlled areas complain of high tax fees and annual financial costs imposed by the Ministry of Finance, which sometimes exceed two million Syrian pounds ($142) for some shops.
In addition, the price of commercial electricity has increased by about 150% since last September, and the extreme difficulty in providing and trading foreign currencies, which are subject to strict legal restrictions.
Mechanisms that hinder trade and raise prices
Yasser Akreem, a member of the Board of Directors of the Damascus Chamber of Commerce, revealed that more than 100,000 merchants have left business in Syria, considering this a major loss for the Syrian economy.
In statements a few days ago, Akreem spoke about the absence of government support for the commercial sector, and stressed that this support is negligible compared to the support provided to the industrial sector, pointing to the negative repercussions of this situation on the economy.
Akreem added that out of 110,000 commercial records registered with the Ministry of Internal Trade and Consumer Protection in the regime’s government, there are only 7,000 active records in the Damascus Chamber of Commerce, attributing this commercial contraction to “a lack of clarity in commercial laws.”
Akreem explained that the merchant in Syria is today in “his worst condition as a result of the government’s failure to support him and stand by him as required.”
Akram had indicated in an interview with the local Sham Radio, last September, that controlling prices is not possible in light of the lack of abundance of raw materials, the high exchange rate, and the prices of energy and fuel.
For his part, Abu Yahya (52 years old), a food trader and warehouse owner in the Al-Midan area in Damascus, attributed the rise in market prices to “ill-considered” government policies.
The trader added in an interview with Al Jazeera Net, “As traders, we cannot accurately determine the cost of imports due to the stability of the exchange rate on the one hand, and the delay in the arrival of imports through the platform (a government mechanism for regulating the import of goods from abroad) for two and three months on the other hand, which forces us to price goods at higher prices.” “What it might be to ensure you don’t lose.”
Abu Yahya points out that the slow work of the import platform compounded the crisis, as it led to “depriving the market of many raw and basic goods and materials, and led to the inability of merchants and factory owners to secure them, which sometimes led them to close their shops and factories.”
For his part, member of the management of the Damascus Chamber of Commerce, Muhammad Hallaq, revealed in a statement to local Radio Melody, last September, that there is no government mechanism to reduce or stabilize prices, indicating that the price regulations issued by the government do not match reality.
Hallaq confirmed that the official decisions issued by the government, such as establishing the import platform and approving the Consumer Protection Law, contributed to hindering the work of merchants and caused prices to rise.
Economists believe that the import platform hindered the movement of production by restricting the import process and financing imports, and restricting it to local exchange companies and the central bank, which led to capital flight and thus a contraction of the economy.
The platform forces merchants to pay 50% of the value of imports to the Central Bank in exchange for granting them an import license, on the condition that they pay the rest of the amount a month after the arrival of the imported goods, which incurs losses and additional expenses to merchants as the exchange rate changes, and pushes them to hedge and raise prices, which leads to the high prices of goods in the country. Markets.
Inflation and economic losses
For 12 years, the Syrian economy has been suffering from worsening crises as a result of the continuing conflict in the country, and the inflation rate in 2023 alone reached 156%, according to Abdul Raouf Nahas, professor of economics at the University of Aleppo.
The Syrian pound lost about 100% of its value during the year 2023, with the dollar exchange rate recording 14 thousand pounds this December, compared to 7 thousand at the beginning of 2023.
The Human Rights Watch report indicates that the economic losses of the war in Syria have reached about $1.2 trillion by 2022, while 13.4 million Syrians need humanitarian assistance.
The direct and indirect losses of the oil sector alone are estimated at approximately $112 billion by the end of 2022, according to a statement by the Ministry of Foreign Affairs of the Syrian regime government.
