Fri 13 Dec 2019

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How is Syria’s 2020 budget distributed?

People's Assembly session was held to approve the state draft general budget for 2020 - 26 November 2019 (Source: al-Watan Newspaper)

People's Assembly session was held to approve the state draft general budget for 2020 - 26 November 2019 (Source: al-Watan Newspaper)

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On Tuesday 26 November 2019, the Syrian People’s Assembly adopted the Syrian budget bill for 2020.

The total financing requirement stands at 4,000 billion Syrian pounds (SYP – around 9.2 billion USD at the exchange rate of the Syrian Central Bank), without making any significant amendments to the draft resolution, which was discussed at the end of last September.

Shares of major sectors in Syria’s general budget

The state-run news agency (SANA) reported that according to the 2020 budget, food and fuel subsidies received the largest share of expenditure at 373 billion SYP (around 497 million USD at current market exchange rate).  184 billion SYP (around 245 million USD) were allocated for social security and pensions.

The government of the Syrian regime allocated a budget of 266 billion SYP (354 million USD) for the Ministry of Health—the same allocated budget of the previous year. The allocated budget is to “rehabilitate public health sectors, medical service centers and hospitals affected by war, and to build children’s hospitals in Aleppo.”

The government also allocated a budget of 90 billion SYP (120 million USD) for the Ministry of Electricity, 83 billion SYP (110 million USD) for supporting economic institutions, 53 billion SYP (70 million USD) for hosting conferences and hospitality, 50 billion SYP (66 million USD) for reconstruction, 32.59 billion SYP (43 million USD) for the Ministry of Education, 31 billion SYP (41.5 million USD) for the resettlement of refugees as well as 29.14 billion SYP (41 million USD) for the Ministry of Higher Education.

Moreover, the state budget allocated about 15 billion SYP (20 million USD) for the Social Aid Fund, 14 billion SYP (18.5 million USD) for the Ministry of Information, 10 billion SYP for the Ministry of Agriculture and Food Production, 4.326 billion SYP (5.75 million USD) for the Ministry of Communication, 2.872 billion SYP (3.8 million USD) for the Ministry of Justice.

In addition, the allocated budget for the Ministry of Tourism was 2.3 billion SYP (around 3 million USD), with a reduction of 800 billion SYP (1065 million USD), compared to last year’s allocations. The budget allocated for the Ministry of Social Affairs and Labor was 1.8 billion SYP (2 million USD).

The state budget allocated 725 million SYP (965,000 USD) for the Ministry of Foreign Affairs and Emigrants and 240 million SYP (320,000 USD) for political expenditures which are classified as “travel and receptions.”

The allocated expenditure approved by the Council of Ministers on 20 October amounts to 2,700 billion SYP (3.6 billion USD): 67.5 per-cent. 1,300 billion SYP (1.7 billion USD) is earmarked for investment. Around 700 billion SYP (933 million USD) is reserved in the event of an “emergency”, according to SANA.

As monitored by Enab Baladi, the total budget assigned for the major sectors and announced by official media outlets reaches 2,600 billion SYP (3.5 billion USD) out of the Syrian budget bill which amounts to 4,000 billion SYP (5.33 billion USD)

The government has not publicly announced the budget allocation for the security and military sectors.

An increase of around 118 billion SYP (around 157 million USD) over the 2019 budget 

 The 2020 budget marks an increase of 118 billion SYP (157 million USD) over the 2019 budget. The 2019 budget was estimated at 3,882 billion SYP (5.176 billion USD) according to the exchange rate of the Central Bank of Syria.

The 2019 budget allocated 2,782 billion SYP (3.7 billion USD) for running expenditures and 110 billion SYP (146 million USD) to support investment.

Last year’s budget bill also allocating 811 billion SYP (1.08 billion USD) for the agricultural production support fund and national social subsidies fund, while 50 billion SYP (around 66 million USD) was allocated for reconstruction.

Moreover, 1.8 billion SYP (2.4 million USD) was allocated to the Ministry of Social Affairs and Labor. Around 14 billion SYP (18 million USD) was allocated to the Ministry of Information, while 90 billion SYP (120 million USD) was used to support the Ministry of Electricity—as expenditures rather than investment projects—49 billion SYP (65 million USD) was set aside for expenditures of government-run enterprises. 266 billion SYP (354 million USD) was allocated for health services.

The head of the budget and accounts committee at the People’s Assembly, Hussein Hassoun, said earlier that social financial support fell from 811 billion SYP (1.08 billion USD) in 2019 to 373 billion SYP (around 497 million USD) in the 2020 budget.

This decline in social financial support in the 2020 budget, in return, will have a negative impact on the citizens, in terms of improving living standards, salaries and wages, according to Hassoun.

What is the budget deficit and how was it justified?

The government’s budget deficit for 2020 reached about 1,400 billion SYP (around 1.8 billion USD).

Finance Minister Mamoun Hamdan said on 26 November that the deficit in the draft budget “is estimated and does not reflect the real deficit.”

Hamdan pointed out that the budget deficit in electricity company for fiscal year 2019 hit 711 billion SYP (around 948 million USD) which remained outside the state budget bill for 2020, according to local newspaper, al-Watan.

Hamdan stressed during his speech on 26 November at the parliament that “there is no need to amend the budget after the [recent] salary increase decrees.”

Additionally, Hamdan highlighted that “the war, to which Syria has been subjected, and the destruction of infrastructure, require more amounts than was allocated”.

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