The proliferation of violence in Syria over the past six years has taken a heavy toll on life of the Syrian people and is resulting in a large outflow of refugees. The estimated death toll has exceeded 250,000 people (as per the UN); a report by the Syrian Center for Policy Research (SCPR) put the death toll at 470,000, with 1.2 million wounded and many more displaced. In addition, The UN High Commissioner for Refugees (UNHCR) estimated that by June 2016, 4.8 million Syrian refugees have been hosted by Egypt, Iraq, Jordan, Lebanon and Turkey. The latest UNHCR statistics reveal that half of the Syrian population has been forcibly displaced, with an estimated 7.6 million internally displaced persons (IDPs). Lack of access to health care and scarcity of medicine have led to a catastrophic health situation. Poor food availability and quality and successive cuts in subsidies on bread have exacerbated nutritional deprivation.
The SCPR estimates that over 60 percent of the labor force (about 3.5 million) is unemployed, with some 3 million having lost their jobs as a result of the conflict. The World Bank has not had poverty estimates since 2007, but SCPR estimates the overall poverty rate at 83 percent in 2014 (compared to 12.4 percent in 2007). Many Syrians, including children, have had to find jobs in the informal sector to offset the loss of income. It is estimated that two-thirds of Syrians are living in extreme poverty, unable to meet basic food and non-food needs. The main reasons for poverty are loss of property and jobs, loss of access to public services, including health and clean water, and rising food prices. Poverty rates are highest in governorates that have been most affected by the conflict and that were historically the poorest in the country.
The economic impact of the conflict is difficult to estimate precisely given limited data but is large and growing. Syria’s GDP is estimated to have contracted by an average of 15.7 percent for the period (2011-2014) and is expected to decline further by 12 percent in 2015 and 4 percent in 2016. The decline in GDP growth was in part attributed to a sharp decline in oil production, down from 368,000 barrels per day in 2010 to an estimated 40,000 barrels per day in 2015 and 2016. After increasing by nearly 90 percent in 2013, average inflation increased by 29 percent in 2014. CPI inflation is estimated to increase by 30 and 25 percent in 2015 and 2016 because of continued trade disruption, shortages and a sharp depreciation of the Syrian pound.
The severe decline in oil receipts since the second half of 2012 and disruptions of trade due to the conflict put pressure on the balance of payments and exchange rate. Revenues from oil exports decreased from US$4.7 billion in 2011 to an estimated US$0.22 billion in 2014, and are estimated to decline further to US$0.14 billion in 2015 and 2016. Therefore, the current account balance is estimated to continue its trend and reach a deficit of 8 and 16 percent of GDP in 2015 and 2016 respectively. As a result of the civil war, it is estimated that total international reserves have significantly declined. Depressed export revenue caused by the impact of the conflict and declining international reserves have caused a significant depreciation of the Syrian pound from 47 pounds per USD in 2010 to an estimated 154 pounds per USD at end-2014.
As a result of Syria’s decline in Gross National Income per capita and the increases in poverty, the World Bank Group recently re-classified Syria as an International Development Association-eligible country, a move which emphasizes the sheer scale of the damage the conflict has done to Syria’s economy. This reclassification places Syria among the world’s poorest countries, and makes it eligible for the Bank’s IDA grants and highly concessional loans.
Last Updated: Apr 01, 2017