Syria's rate of inflation rose to 32.5 percent in May compared with the same month a year ago, as the cost of food products increased, the country's Central Bureau of Statistics reported.
The price of meat, fruits, bread, housing water and electricity increased, while the cost of dairy, non-alcoholic drinks, vegetables and sugar decreased, according to the government agency.
International sanctions and nearly 17 months of political unrest that have so far claimed more than 10,000 lives, according to United Nations estimates, have slowed the pace of economic growth. European and US sanctions have increased pressure on President Bashar al-Assad's administration as fuel shortages and a depreciating currency further threaten the stability of the country.
"Sanctions have negatively impacted the Syrian economy by forbidding it to export oil and not allowing ships to transport or for insurance companies to cover ships transporting to and from the country," Finance Minister Mohammed Al Jleilati said in an interview with Arabian Business last month. "When they sanctioned our ability to import we had to use the state's money to secure imports to meet local demand. We have a shortage of gas and we're trying to secure the 40 percent shortfall from various sources and we will have enough shortly."
The oil industry accounted for 20 percent of gross domestic product before the uprising began and the EU used to buy 95 percent of Syria’s oil exports. The country's economy has lost US$4bn in revenue as a result of the oil sanctions, Jleilati said.
Despite the sanctions on Syria, the country's economy will not "collapse,'' Finance Minister Jleilati told Arabian Business.
Syria's economy will grow between 0 and 2 percent this year while the fiscal deficit "remains within normal estimates" and on target of 6 to 7 percent of GDP, Jleilati said. Syria’s economy contracted 3.4 percent in 2011 largely due to the unrest, while GDP is expected to shrink by 8.1 percent in 2012, according to the Economist Intelligence Unit.
Total unemployment in Syria has increased from about 12 percent to 25 percent, according to Jleilati.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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