Daraa: Rise in fuel prices doubles costs of building materials and freezes construction activity

Construction workers at a house in Daraa’s western countryside - October 25, 2023 (Enab Baladi/Halim Muhammad)

Construction workers at a house in Daraa’s western countryside - October 25, 2023 (Enab Baladi/Halim Muhammad)

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Daraa – Halim Muhammad

Mahmoud (30 years old), a resident of Daraa’s western countryside, could not complete the construction of his house due to a threefold increase in the prices of building materials since he started building it in last May.

The rise in prices of building materials has brought construction activities in Daraa to a standstill. People hesitate to build new houses or continue construction due to the high costs, and the high fuel prices are a major contributing factor to this increase.

Industrial fuels behind the price hike

The prices of building materials have doubled since mid-August following a series of government decisions to increase the prices of fuel and cement.

According to the latest bulletin issued by the Syrian Ministry of Internal Trade and Consumer Protection on October 30, the ministry set the selling price of some types of industrial fuels, with the price of a liter of unsubsidized diesel reaching 12,430 Syrian pounds.

The price of a ton of fuel reached 7,928,250 Syrian pounds, and the price of a ton of liquid gas, dokma, reached 10,682,350 Syrian pounds.

On the other hand, the price of a square meter of gravel and sand reached 175,000 Syrian pounds, the price of a construction block reached 5,000 Syrian pounds, the price of a ton of iron reached about 12,500,000 Syrian pounds, and the price of a cement bag reached 150,000 Syrian pounds after it was no more than 50,000 pounds months ago.

The US dollar is trading at 13,950 SYP according to the S-P Today website, which covers the trading rate of the Syrian pound to the dollar. At the start of the conflict in 2011, the dollar was trading at 47 pounds.

Mahmoud, the young man residing in the countryside of Daraa, said that prices suddenly spiked after the fuel price hike and that the cost of fuel is a key factor affecting the operations of quarries that produce gravel and sand, as well as their transport. This aligns with testimonies from building material merchants interviewed by Enab Baladi.

Mahmoud added that he bought a meter of sand last July for 80,000 Syrian pounds, while it currently costs 250,000 pounds. The price of a ton of cement was one million Syrian pounds, while it is now three million.

Mahmoud only managed to build the foundation and roof of the house. He mentioned that if he knew about the price jump, he would have purchased all the building materials at once when he began construction, as he had hoped to complete the house building before winter to get married in it, but with the rising costs, he had to halt construction indefinitely.

Hussam al-Najm, a contractor in Daraa, told Enab Baladi that there is a main reason affecting the prices of building materials, which is the price of diesel. Quarries have raised prices of building materials due to increased operational costs, and transportation fees have also doubled, as most quarries are located at least 200 kilometers away from Daraa, al-Najm added.

The contractor explained that fuel, whose price has increased, is used in manufacturing cement, and gas is used in ceramic production, leading to a rise in the prices of these construction materials.

One of the factors that has caused the stagnation of the construction process is the recent increase in cement prices. Cement is used in large quantities and is involved in all construction stages, even in the finishing works, according to the contractor, who added that the price of a ton of cement does not exceed $100 in neighboring countries, while it exceeds $200 in Syria.

In early June of this year, the Syrian government raised the price of bulk and packed cement produced by public and private sector factories in Syria.

According to the decision, the selling price of a ton of 32.5N packed portland cement reached 700,000 Syrian pounds, the price of pozzolanic cement was set at 677,000 Syrian pounds per ton, and the price of a ton of 32.5N bulk portland cement was set at 613,750 Syrian pounds.

Limited purchasing power for construction

Saeed (40 years old) still lives in a single room in his family’s house despite being married for ten years. The young man, who works as a farm laborer for a daily wage of 20,000 Syrian pounds, told Enab Baladi, “How can I build a house when my income doesn’t cover my family’s expenses?”

A civil engineer in Daraa, who preferred not to be named, estimated the minimum cost of building a house at $20,000, noting that the high construction costs have contributed to a stagnation of construction activities, making it almost at a halt at present.

Meanwhile, contractor Hussam al-Najm said that the stagnation of construction activities has paralyzed the economic movement in the province because the construction process stimulates the job market and the selling of building supplies.

He added that the stagnation of construction activities has increased the demand for rental houses, especially since Daraa governorate has witnessed a halt in construction for years amid extensive damage to buildings due to military operations in the region since 2011.

 

 

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