The size of the Syrian 2013 draft budget deficit has become a cause of concern for some legislators during last week’s budget debate. They argued this deficit, which is to rise from S£216bn ($3.1bn) in 2012 to S£745bn ($10.6bn) in 2013, needs to be addressed with adequate policies and austerity measures (MEES, 2 November). This prompted Finance Minister Muhammad Juleilati to intervene in the debate and explain that the culture of accumulating budget deficits goes back to 2003.
The minister stressed that the deficit in past years was structural and had to be corrected by raising the sources of revenue and/or rationalizing the level of expenditure. Syrian budgets have lacked transparency in the past and the government’s economic narrative on fiscal policy has failed to explain how the budget gap was previously bridged. Syria in a state of civil war no longer has access to its usual sources of revenue from domestic economic activity (now severely curtailed), trade, or foreign investment. With its dwindling foreign exchange reserves, Syria is reported to have received some financial assistance from its strategic ally Iran and other friendly countries. But this cannot be sustained in Iran’s case because it also faces financial turmoil, due to international sanctions. (CONTINUED - 286 WORDS)