THE SOCIO-ECONOMIC IMPACTS OF THE COVID-19 PANDEMIC IN THE SYRIAN ARAB REPUBLIC - (April - June 2020) - ReliefWeb
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THE SOCIO-ECONOMIC IMPACTS OF
THE COVID-19 PANDEMIC IN THE
SYRIAN ARAB REPUBLIC
(April – June 2020)
October 2020
ACKNOWLEDGEMENTS TABLE OF CONTENTS
This World Food Programme (WFP) study constitutes a technical analysis of the socio-eco-
nomic impacts of the coronavirus disease 2019 (COVID-19) pandemic outbreak in the Syrian
Acknowledgments 1
Arab Republic (Syria). The study investigates food supply chains, traders and transporters’
EXVLQHVVPRGHOVDVZHOODVIRRGVHFXULW\DQGIRRGSULFHWUHQGV7KLVHRUWZRXOGQRWKDYH Abbreviations 2
EHHQSRVVLEOHZLWKRXWWKHFROODERUDWLRQRIVHYHUDOXQLWVRIWKH:)36\ULD&RXQWU\2ɝFHLQ-
cluding the Supply Chain, Retail, Programme and Vulnerability Analysis and Mapping (VAM) Executive Summary 4
XQLWV7KLVVWXG\FRYHUVWKHSHULRGZKHQWKH&29Ζ' RXWEUHDNȴUVWDSSHDUHGLQ6\ULDDQG
when mitigation measures were put in place to limit the virus’ spread (April – June 2020). Highlights 6
The study is part of a wider United Nations in-depth report of the impact of COVID-19 on Syr- Methodology 7
ia, known as “Syria COVID-19 Inter-Agency Socio-Economic Impact Assessment”.
Section 1: Introduction 8
'DWDZDVFROOHFWHGE\:)36XSSO\&KDLQ5HWDLODQG9$0XQLWVWD $EGXOODK$OVKDJKHO'LQD:D]]DQ)DGL
Shakkour, Firas Sukkar, Ghada Ezzo, Ghaith Fadel, Moammar Alhosaeen, Omar Alghadban and Sana Sadd- Section 2: Macro-Economic Impact of COVID-19 12
DNQ\7KHUHSRUWLWVHOILVDFROODERUDWLYHHRUWZULWWHQE\'LPD$OKXPVL-DQ0LFKLHOV3DNLQDP0RXVVDDQG
Section 3: Impact on Syrian Food Markets 18
Rie Ishii, and edited by Daniel Arukwe Johansen and Jan Michiels. Graphic design support was provided by
7DUHN-DFRE7KHUHSRUWZDVUHYLHZHGE\:)3FROOHDJXHVDWWKH:)36\ULD&RXQWU\2ɝFHLQ'DPDVFXVWKH Section 4: Mrket Price Trends 26
WFP Regional Bureau for the Middle East, North Africa, Central Asia and Eastern Europe in Cairo, as well as
by colleagues at WFP headquarters in Rome. Section 4: Food Security Trends 38
Section 5: Case- Food Security Impact of a Localized COVID-19 ‘Lockdown’ 50
Section 6: Impact on the Syrian Transporter Market 52
ABBREVIATIONS Section 8: Conclusion
Section 9: Recommendations
54
56
BDI – Baltic Dry Index MoITCP – Ministry of Internal Trade and Consumer Protection
Section 10: Annexes 58
CBT – Cash Based Transfer M-o-M – Month-on-month
COVID-19 – Coronavirus disease 2019 MT – Metric tonnes
FB – Food Basket mVAM – Mobile Vulnerability Analysis and Mapping
FCS – Food Consumption Score NES – North-East Syria
FSA – Food Security Assessment (covers Government of Syr- NFI – Non-food item
ia-held areas of the country) PPE – Personal Protective Equipment
FSLA – Food Security and Livelihoods Assessment (covers rCSI – Reduced Coping Strategy Index
opposition-held areas of Syria)
SFT – Syria For Trade
GECPT – General Establishment for Cereal Processing and
SMART - Standardised Monitoring and Assessment of Relief
Trade
and Transitions survey
GFA – General Food Assistance
SYP – Syrian Pound
GoS – Government of Syria
ToT – Terms of Trade
HNO – Humanitarian Needs Overview
USD – United States Dollar
IDPs – Internally Displaced People
VAM – WFP Vulnerability Analysis and Mapping
Kg - Kilograms
WFP – World Food Programme
KSA – Kurdish Self Administration
XB – Cross border
Lt – Litres
Y-o-Y – Year-on-year
MAAR – Syrian Ministry of Agriculture and Agrarian Reform
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:)3$OL+DELE
EXECUTIVE SUMMARY
The food security situation in Syria has deteriorated continued to rise during the government-imposed This report adds to the 2020 Syria COVID-19
VLJQLȴFDQWO\RYHUWKHSDVWWZR\HDUVDQGHVSHFLDOO\ COVID-19 related lockdown period in Syria (which Inter-Agency Socio-Economic Impact
VLQFHWKHVWDUWRIWKH/HEDQHVHȴQDQFLDOFULVLV severely restricted population movement as well as Assessment Report by providing readers
in October 2019. In September 2019, WFP and commercial, industrial and agricultural activities) due with in-depth information on how Syria’s
the Food Security Sector estimated that some to panic buying, hoarding, and lack of controls on food supply chains, trader business models,
7.9 million Syrians were food insecure, 39 percent prices, highlighting how COVID-19 exacerbated the commodity prices and household food
of the total population (HNO 20201). Of these, already dire situation. However, since the lockdown security levels have all been impacted by
approximately 500,000 people were estimated period ended (late May 2020), prices have continued the COVID-19 pandemic. By taking stock of
to be severely food insecure. However, in April to increase, and food insecurity indicators have the impact of COVID-19 mitigation measures
2020, a review of food security data adjusting for continued to worsen. June 2020 saw the highest that were put in place between March and
the dramatic food price increases seen since late national average price of the WFP standard reference June 2020, this study assesses their impact
2019 projected that the total number of people food basket3 since the start of the crisis in 2011 as on the Syrian economy and on Syrian
food insecure in Syria had increased by 1.4 million, well as a serious deterioration of key household food household food security, outlining which
to a new total of 9.3 million people, the highest security indicators and a dramatic decline in the VHFWRUVKDYHEHHQZRUVWDHFWHGDVZHOODV
number ever recorded, and close to half the total purchasing power of Syrian households. identifying key vulnerable groups needing
population of the country. At the same time, the It is worth noting that the current economic assistance.
number of people categorized as severely food hardships faced by the Syrian population is not
insecure had doubled, reaching more than one primarily driven by the COVID-19 outbreak itself,
million people. but is the result of multiple concurrent factors that
The global coronavirus disease 2019 (COVID-19) even individually would have been disruptive in
outbreak, declared a pandemic by the World their own right. The pre-existing and underlying
Health Organization (WHO) on 11 March 2020, is fragility of the Syrian economy and the multiple
one of many concurrent and interlocking factors shocks that occurred in between mid-2019 and
that has spurred the deteriorating food security 2020 have greatly weakened the Syrian economy.
trends that have been observed in Syria since late As such, the restrictions applied during the initial
2019. Since October 2019, Syria has witnessed phase of the pandemic have had a disproportional
multiple shocks, including extensive military HHFWRQWKHZHOOEHLQJRQWKH6\ULDQSRSXODWLRQ
operations in north-eastern Syria, a dramatic heavily impacting employment opportunities
escalation of hostilities and massive population across the country, pushing up prices, further
displacement in north-western Syria, the Lebanese eroding household coping mechanisms and
ȴQDQFLDOFULVLVLQWHQVLȴFDWLRQRIXQLODWHUDOFRHUFLYH worsening already dire socio-economic indicators.
measures (economic sanctions) targeting the Through an in-depth review of Syria’s food supply
Syrian government and third party businesses chains, trader purchasing patterns, food price
dealing with the Syrian government, in addition to trends and household food security levels, this
the global spread of COVID-19. study aims to shed light on the current situation
This study outlines that while the food security in key food-related sectors of the Syrian economy.
situation was worsening in Syria before COVID-19, These sectors require support to mitigate the
the deterioration has since accelerated due to the impact of COVID-19 and help pave the way for
global, regional and local impacts of the pandemic the development of more resilient household
and associated mitigation measures. A WFP rapid livelihoods that can build resilience to future
food security assessment2 had already reported that VKRFNV$GLɝFXOWZLQWHUVHDVRQOLHVDKHDGLQ
by February 2020, the deteriorating Syrian pound 21, as households are already facing deteriorating
©WFP/Muhammad Deab
(SYP)/USD informal exchange rate had already led purchasing power due to the recent dramatic
WRZLGHVSUHDGLQȵDWLRQDFURVVDOOVHFWRUVRIWKH increase in the price of goods and inputs, with no
Syrian economy, food included. The price of food change in their income levels.
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1
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7KH:)3UHIHUHQFHIRRGEDVNHWLVDJURXSRIHVVHQWLDOIRRGFRPPRGLWLHVZKLFKLQ6\ULDLQFOXGHVNLORJUDPPHV NJV RIEUHDG NJVRI
ULFH NJVRIOHQWLOVNJVRIVXJDUDQGOLWUHVRIYHJHWDEOHRLO SURYLGLQJNLORFDORULHVSHUGD\IRUDIDPLO\RIȴYHIRURQHPRQWK
4 THE SOCIO-ECONOMIC IMPACTS OF THE COVID-19 PANDEMIC IN THE SYRIAN ARAB REPUBLIC 5
HIGHLIGHTS
UHWXUQHHVJRLQJIURPȴYHSHUFHQWWRSHUFHQWRI
respondents, while poor food consumption levels
increased at a somewhat slower rate for residents
©WFP/Khudr Alissar
(from four to seven percent).
COVID-19 Cases4: As of 01 September 2020, there higher than the pre-crises 5-year monthly average.
ZHUHRɝFLDOO\UHSRUWHGFDVHVRI&29Ζ' Dietary Diversity: On average in June 2020,
Purchasing Power: The national average price
infection in Syria, with 116 reported deaths and 646 over half (52 percent) of interviewed households
of the WFP standard reference food basket (SYP
registered recoveries. The cases have been steadily reported consuming a low diversity diet; double the
84,095 in June 2020), is now higher than even the
increasing at an accelerating rate since June. It is percentage of households reporting consuming a low
KLJKHVWRɝFLDOPRQWKO\JRYHUQPHQWVDODU\RI6
SECTION 1
©WFP/Ali Habib
INTRODUCTION
Over the past year, Syria has been impacted :KLOHWKHWRWDOQXPEHURIFRQȴUPHG&29Ζ'
by a series of events that have greatly FDVHVLQ6\ULDUHPDLQVUHODWLYHO\ORZFRPSDUHGWR
reshaped the geographic and economic RWKHUFRXQWULHVVLQFHWKHȴUVWFDVHZDVFRQȴUPHG
structure of the country. The Turkish RQ0DUFK6\ULDKDVVHHQDUDSLGO\
military incursion into north-eastern DFFHOHUDWLQJJURZWKLQWKHQXPEHURIFRQȴUPHG
Syria in October 2019 (‘Operation Peace FDVHVRYHU-XO\DQG$XJXVW7KHVHMXPSHGIURP
Spring’) which led to the displacement of an FRQȴUPHGFDVHVRQ-XQHWR FDVHVE\
estimated 180,000 people in less than three -XQHDQGFRQȴUPHGFDVHVE\-XO\$VRI
ZHHNV WKHRQJRLQJ/HEDQHVHȴQDQFLDOFULVLV 6HSWHPEHUFDVHVKDYHEHHQFRQȴUPHG
that has further destabilized an already DFURVVWKHFRXQWU\+RZHYHUJLYHQWKHOLPLWHG
ailing Syrian economy reeling from nine WHVWLQJEHLQJFRQGXFWHG RQO\WHVWVKDYH
\HDUVRIFRQȵLFW DGUDPDWLFHVFDODWLRQRI EHHQFRQGXFWHGDVRI6HSWHPEHU LWLV
FRQȵLFWLQQRUWKZHVWHUQ6\ULDWKDWVWDUWHG OLNHO\WKDWPDQ\DV\PSWRPDWLFDQGPLOGFDVHV
in late 2019 and continued into 2020 that DUHJRLQJXQGHWHFWHGDQGWKDWWKHDFWXDOQXPEHU
displaced over one million people in the RI&29Ζ' FDVHVIDUH[FHHGVRɝFLDOȴJXUHV
largest wave of displacement seen yet in the $FFRUGLQJWR2&+$DQG:+2WKHVRXUFHRI
6\ULDQFULVLV DVZHOODVWKHLQWHQVLȴFDWLRQ SHUFHQWRIRɝFLDOO\FRQȴUPHGFDVHVUHPDLQ
of unilateral coercive measures (economic XQNQRZQLQGLFDWLQJZLGHVSUHDGFRPPXQLW\
sanctions) in June 2020. These developments WUDQVPLVVLRQDFURVVWKHFRXQWU\:KLOHPRVW
have all heavily impacted Syria and the UHVWULFWLRQVDQGPLWLJDWLRQPHDVXUHVKDYHEHHQ
wellbeing of the Syrian population. COVID-19 OLIWHGFDXWLRQUHPDLQVDVWKHORRPLQJVSHFWUH
is an important addition to this list of shocks RIQHZORFNGRZQVDQGFXUIHZVUHPDLQVDQGLV
and disruptive events. It has increased HYHUSUHVHQWZKLFKDVZDVYLVLEOHGXULQJLWVEULHI
the vulnerability of Syrians by negatively LPSOHPHQWDWLRQLQ0DUFKWR0D\FDXVHG
impacting already fragile livelihoods as VHYHUHGLVUXSWLRQVWRWKH6\ULDQHFRQRP\DQGWR
well as by disrupting supply chains and WKHFRXQWU\ȇVJHQHUDOIRRGVHFXULW\VLWXDWLRQ
increasing commodity prices. As such,
COVID-19 is a contributing factor that is
further compounding the many negative
developments that had been impacting an
already fragile Syrian economy.
8 THE SOCIO-ECONOMIC IMPACTS OF THE COVID-19 PANDEMIC IN THE SYRIAN ARAB REPUBLIC 9
TIMELINE OF COVID-19 RELATED RESTRICTIONS:
7KHȴUVW&29Ζ' FDVHVZHUHUHSRUWHGLQ&KLQD entrance of cities to test travellers moving from one 7KH*RYHUQPHQWRI6\ULD *R6 FRQWUROOHGDUHDV IURPSXEOLFEDNHULHVLQ1(6ZDVIRUWKHPRVWSDUW
in December 2019 and rapidly spread across part of the country to the other. Borders remained RIQRUWKHDVW6\ULD 1(6 IROORZHGWKHVDPH RIWKHLQLWLDOSKDVHRIWKHRXWEUHDN 0DUFKWR-XQH
the globe in early 2020, causing governments closed, however, and anyone wanting to enter &29Ζ' PHDVXUHVDVWKHUHVWRIWKH*R6DUHDV QRWDYDLODEOHIURPSXEOLFEDNHULHVEXWZDVLQVWHDG
to impose strict lockdown measures to contain Syria needed to be tested for COVID-19 through a RI6\ULDZKLOHDUHDVXQGHUWKHFRQWURORIWKH VROGWKURXJKEUHDGDJHQWVSXVKLQJXSWKHSULFHRI
the spread of the virus. Syria commenced strict polymerase chain reaction (PCR) test. .XUGLVK6HOI$GPLQLVWUDWLRQ .6$ LQ1(6IROORZHG EUHDGLQWKLVUHJLRQ
mitigation measures, including movement Even though food businesses were allowed to VLPLODU\HWVRPHKRZVOLJKWO\GLHUHQWPHDVXUHV 'XULQJ0D\*R6GHFLGHGWRPDLQWDLQGDLO\
restrictions and a nationwide curfew to curb operate, this had to be done along reduced )RUH[DPSOHZKLOHFXUIHZKRXUVIRUWKH*R6 FXUIHZKRXUVGXULQJ(LG$O)LWUIURP WR
the spread of virus in mid-March. On 15 March RSHUDWLQJKRXUVDQGZLWKUHGXFHGVWDZKLOH FRQWUROOHGDUHDVLQ1(6ZHUHLPSRVHGIURP $OOFRPPHUFLDODQGVHUYLFHSURIHVVLRQV
2020, the Syrian government implemented the ensuring COVID-19 compliant measures were in WR DUHDVXQGHU.6$FRQWURO DFFRXQWLQJ ZHUHDOORZHGWRRSHUDWHXQWLO XQWLOWKH
ȴUVW&29Ζ' UHODWHGUHVWULFWLRQVE\FORVLQJ place. While export bans which were introduced at IRUDSSUR[LPDWHO\ SHUFHQWRI1(6 IROORZHGD HQGRI(LG$O)LWULQFOXGLQJ)ULGD\0D\7KH
schools and universities as well as reducing public the end of March for eggs, milk, cheese, legumes, FXUIHZIURP WR .6$FRQWUROOHGDUHDV JRYHUQPHQWVXEVHTXHQWO\FRPSOHWHO\OLIWHGWKH
institutions’ workforce capacity by 40 percent. javel water and chlorine remain in place as of early DOVRFORVHGQRQIRRGUHODWHGEXVLQHVVHVZKLOH QLJKWO\FXUIHZDQGWKHUHVWULFWLRQRIPRYHPHQW
Further COVID-19 related restrictions were then September, imports have not been restricted H[HPSWLQJIRRGDQGDJULFXOWXUHUHODWHGDFWLYLWLHV DPRQJSURYLQFHVRQ0D\([FHSWIRUVRPH
progressively introduced throughout the second throughout the COVID-19 period. On 23 April, one IURP&29Ζ' PRYHPHQWUHVWULFWLRQV/DUJH DUHDVWKDWZHUHVXEMHFWWRORFDOL]HGORFNGRZQGXH
half of March. day before Ramadan, all commercial services were IUXLWDQGYHJHWDEOHPDUNHWVDVZHOODVOLYHVWRFN WR&29Ζ' RXWEUHDNV VXFKDV5DV$O0DȇDUDLQ
By the end of March, the Syrian government had RɝFLDOO\DSSURYHGWRUHVXPHDFWLYLW\IURP WR PDUNHWVZHUHDOVRFORVHGZKLFKZDVWKHVDPH 5XUDO'DPDVFXVJRYHUQRUDWHDQG-DGLGDW$O)DGO
imposed lockdown measures across Syria with 17:00 in an attempt to bolster the economy over SUDFWLFHIRU*R6KHOGDUHDVRI6\ULD%RUGHUVIRU LQ4XQHLWUDJRYHUQRUDWH %\HDUO\-XQHDOOLQLWLDO
all non-food related businesses being forced the important festive period. SHRSOHHQWHULQJ6\ULDZHUHFORVHGLQ1(6IURP &29Ζ' UHODWHGUHVWULFWLRQVKDGEHHQOLIWHG
to shut. Only food businesses and agencies/ QHLJKERXULQJFRXQWULHVDQGDOOFURVVLQJSRLQWV DFURVV6\ULDDQGDOOEDUVDQGUHVWDXUDQWVZHUH
While most of Syria followed the above measures, EHWZHHQ.6$DQG*R6KHOGDUHDVZHUHDOVRFORVHG
institutions providing essential services were VRPHJRYHUQRUDWHVSXWLQSODFHGLHUHQWUHVWULFWLYH DOORZHGWRUHRSHQDOEHLWDWUHGXFHGFDSDFLW\WR
allowed to operate between 06:00 and 18:00. IURPODWH0DUFKDQGWKURXJKRXW$SULO7KUHH PDLQWDLQSK\VLFDOGLVWDQFLQJ
regulations. For example, opposition-held Idleb &29Ζ' FDVHVZHUHUHSRUWHGLQWKH$O2PUDQ
A nationwide curfew was imposed across Syria governorate introduced measures which were A day-to-day progression timeline on the
from 18:00 to 06:00. Areas which showed an QHLJKERXUKRRGLQ$O+DVDNHKFLW\ $O+DVDNHK
implemented later than in the rest of the country. JRYHUQRUDWH LQHDUO\$SULOZKLFKOHGWRDFRPSOHWH introduction of COVID-19 restriction measures and
increase in COVID-19 cases were isolated and In early April, all non-food related businesses and evolution of the COVID-19 in Syria between March
placed under a complete lockdown. For example, ORFNGRZQRIWKHQHLJKERXUKRRGDQGDFXUIHZIURP
shops were informed to cease operations and only WR 8QOLNHLQWKHUHVWRI6\ULDEUHDG and June is available in Annex 1.
the neighbourhood of Sayeda Zeinab in Rural food businesses were allowed to operate. Bazaars
Damascus governorate, was put under lockdown (big market spaces) were instructed to close,
from 02 April to mid-May as it had reported a spike while restaurants and cafes were only allowed
in COVID-19 cases in late March/early April. takeaway services. However, these measures were
By mid-April however, as the economic pressure QRWRɝFLDOO\HQIRUFHGDQGED]DDUVUHPDLQHG
grew, with prices of commodities increasing, operational as usual, albeit with fewer customers.
the Syrian government started easing some of Restaurants and cafes operated normally, and
the restrictive measures. On 13 April, the Syrian non-food businesses also largely continued
government allowed mechanics, smiths, carpenters, operating uninterrupted. Borders between Afrin
shops selling agriculture related inputs, jewellers, (Aleppo governorate) and Idleb governorate were
mobile phone shops and taxi services to reopen. also closed in early April. However, smuggling of
Moreover, movement between governorates was food-items between Afrin and Idleb continued
allowed for a few select weekends between April WKURXJKRXWWKHFORVXUHDQGWKHERUGHUVRɝFLDOO\
©WFP/Khudr Alissar
and May with medical teams stationed at the re-opened again later in April.
10 THE SOCIO-ECONOMIC IMPACTS OF THE COVID-19 PANDEMIC IN THE SYRIAN ARAB REPUBLIC 11
SECTION 2
MACRO-ECONOMIC
IMPACT OF COVID-19
©WFP/Ali Habib
The COVID-19 pandemic has caused global
economic disruption and has spurred the
deepest global recession since the Great
Depression of 1929-1939. Global supply
chain challenges were noted as early as
January 2020, and the impact became most
prominent during the months of February
to June. According to Fortune Magazine
“94 percent of the Fortune 1,000 are seeing
coronavirus supply chain disruptions”5
. The World Economic Forum reported
DVLJQLȴFDQWGLSLQWKHZHHNO\JOREDO
transactions against pre-lockdown levels6,
as per the following chart:
Graph 1: Average weekly global transactions –
percentage increase/decrease against pre-lockdown
levels
0
-10
-20
w/c Mar 9 w/c Mar 16 w/c Mar 23 w/c Mar 30 w/c 6 Apr w/c 13 Apr w/c 20 Apr
KWWSV IRUWXQHFRPIRUWXQHFRURQDYLUXVFKLQDVXSSO\FKDLQLPSDFW
5
KWWSV ZZZZHIRUXPRUJDJHQGDWKLVLVZKDWJOREDOVXSSO\FKDLQVZLOOORRNOLNHDIWHUFRYLG
12 THE SOCIO-ECONOMIC IMPACTS OF THE COVID-19 PANDEMIC IN THE SYRIAN ARAB REPUBLIC 13
The biggest impact felt by WFP in Syria was in the Especially for rice, for which WFP Syria relies
In addition, a survey conducted by the Institute of Supply Chain Management indicated that price of white rice, which peaked in the month of April. entirely on imports, the international quoted
“notably, nearly 75 percent of companies report supply chain disruptions in some capacity due To sustain its food pipeline, WFP Syria was forced to price increased by up to 36 percent between the
to coronavirus-related transportation restrictions, and more than 80 percent believe that their procure rice from Thailand, resulting in a 12 percent beginning and the end of April. The price gradually
organization will experience some impact because of COVID-19 disruptions. Of those, one in six price increase in price compared to the average declined as April progressed, and by May, the
(16 percent) companies report adjusting revenue targets downward an average of 5.6 percent due import prices seen prior to the outbreak. Reuters price had returned to within the normal market
to the coronavirus7”. Finally, International Food Policy Research Institute (IFPR) data also clearly reported that globally the price of rice had reached ȵXFWXDWLRQUDQJH
indicates a correlation between the increase in export restrictions and the number of COVID-19 a seven-year high at the end of March11$QRɝFLDO In terms of export restrictions, those which
cases8RXWOLQLQJWKHH[WHQWWRZKLFKWKHSDQGHPLFLVDHFWLQJJOREDOVXSSO\FKDLQV quote from the Thai Rice Exporters Association for had impacted WFP’s operation in Syria are
DȴYHSHUFHQWZKLWHULFH JUDGH5Ζ7+:+7$ DOVR listed in Table 1 below.
Map 1: COVID-19 Temporary Export Measures reported a seven-year high in the last week of March
at USD 564 per tonne, up more than 12 percent from
USD 502 from the previous week12.
Table 1: COVID-19 global export restrictions that impacted WFP operations in Syria (as on 21 April 2020)
*Source: Macmap, as of 12th May 20209
The impact of COVID-19 on the Syrian food supply Syria was no exception to supply chain challenges
FKDLQKDVEHHQVLJQLȴFDQWDQGKDVH[DFHUEDWHG and disruptions. Even though globally, restrictions
the already dire economic situation in the country on food exports were less prominent compared to
following the depreciation of the Lebanese pound medical supplies, WFP’s humanitarian operations in
seen since October 2019. The Syrian and Lebanese 6\ULDZHUHVLJQLȴFDQWO\LPSDFWHGE\SULFHLQFUHDVHV
economies are closely intertwined, and as such, of internationally sourced and imported staples,
WKH /HEDQHVHȴQDQFLDOFULVLVKDVKDG such as rice and pulses. As COVID-19 spread across
VLJQLȴFDQWULSSOHHHFWVRQWKH6\ULDQHFRQRP\7KH the globe, countries started to impose export
HHFWVRI&29Ζ' KDVIXUWKHUGHSUHVVHGERWKWKH restrictions on food as well as health and hygiene
Syrian and Lebanese economies. However, in neither LWHPVDWGLHUHQWLQWHUYDOVIURPODWH0DUFKWRHDUO\
country has the central bank been able to take April 2020, most of which were removed by June
expansionary measures to protect their economies 202010. Source: https://www.macmap.org/en/covid19
due to dwindling foreign reserves.
KWWSV ZZZLQVWLWXWHIRUVXSSO\PDQDJHPHQWRUJQHZV1HZV5RRP'HWDLOFIP"ΖWHP1XPEHU 662
KWWSV SXEOLFWDEOHDXFRPSURȴOHODERUGHYL]KRPH([SRUW5HVWULFWLRQV7UDFNHU)RRG([SRUW5HVWULFWLRQV7UDFNHU
KWWSV ZZZWUDGHHFRQRPLFVFRPOHJDODQGSROLF\LPSOLFDWLRQVRIFRYLG UHODWHGH[SRUWUHVWULFWLRQV
https://www.hellenicshippingnews.com/world-trade-despite-a-sudden-interruption-global-value-chains-still-have-a-bright-future-2/
11
6HHΖ)35ΖȇVH[SRUWUHVWULFWLRQWUDFNHU 12
https://www.reuters.com/article/thailand-rice/thai-rice-prices-hit-7-year-high-on-anticipated-sales-as-coronavirus-troubles-rivals-exporters-
10
KWWSV SXEOLFWDEOHDXFRPSURȴOHODERUGHYL]KRPH([SRUW5HVWULFWLRQV7UDFNHU)RRG([SRUW5HVWULFWLRQV7UDFNHU idUSL4N2BQ2F8
14 THE SOCIO-ECONOMIC IMPACTS OF THE COVID-19 PANDEMIC IN THE SYRIAN ARAB REPUBLIC 15
In terms of shipping, the impact was price of rice reached a small peak on 29 April, before
felt earlier. In February 2020, Dry Cargo doubling in June. In contrast, the increase in price Map 2: COVID-19: Government Response Stringency Index – March 31, 2020
International reported that “the Baltic Dry for wheat was gradual and less pronounced, despite
Index has now reached lows last seen in early Russian export restrictions, which were expected to
ZKHQWKHVKLSSLQJVHFWRUZDVVXHULQJ increase world wheat prices as Russia is one of the
a supply and demand imbalance in the wake largest exporters of wheat in the world.
of the 2008-09 global economic crisis”13. As 6SHFLȴFWRWKHFRQWH[WLQ6\ULDZDVDQRWDEOHGHOD\
containment measures were imposed by in the legalization of documents. Suppliers were
governments, such as lockdowns, restrictions unable to reach certain Syrian consulates due to
of movement and stricter quarantine international and internal borders closing for the
measures, shipping also slowed down. movement of individuals. As these legalization
The Baltic Dry Index (BDI) is often used as a documents are required to be handled in person
UHȵHFWLRQRIVKLSSLQJKHDOWKVWDWXVΖWDFWVDVD and not through third party courier services,
‘blood-line’ for the global market, allowing goods – suppliers were unable to receive the approvals
such as rice and wheat to move in bulk on the ‘most required to travel or cross Syrian international
representative’ routes. The BDI indicated that the borders.
©WFP/Hussam Al Saleh
While it was clear from the circular that the curfew restrictions, they could only work eight hours
“centres of selling items” were excluded from such a day during the working week, and further reduced
IMPORT DISRUPTIONS FOR SYRIA restrictions, imposition of the curfew and limitations hours during the weekend. This meant that food
RQPRYHPHQWGHIDFWRDHFWHGWKHSURGXFWLRQ LWHPVZHUHFRPLQJRWKHVKHOIIDVWHUWKDQWKH\
Despite the mitigation measures imposed by the that the General Establishment for Cereal capacity of importers and wholesalers. For example, could be replenished, leading to shortages and
Government of Syria (GoS), all borders remained Processing and Trade (GECPT) in Syria – responsible some WFP workers were unable to access the increases in the price of many food items.
open for the movement of commercial cargo. Both for the purchasing and public marketing of cereals, workplace, thus reducing WFP’s regular packaging This issue was largely addressed by early-April when
Tartous and Lattakia ports remained operational LQFOXGLQJZKHDWȂPDGHRHUVWRLPSRUW capacity. Some of the wholesalers mentioned that SDFNDJLQJȴUPVZHUHGHHPHGȆFULWLFDOMREVȇE\WKH
throughout, as well as the overland border tonnes of wheat from Russia, but failed to complete movement restrictions impacted their packaging Syrian Government and could circumvent curfew
crossings from Lebanon at Jdeideh and Arida. The the purchase due to problems accessing US dollars capacity, especially when compared to the demand movement restrictions. In fact, an increase in prices
border with Jordan remained open for commercial ȆVWXFNȇLQWKH/HEDQHVHȴQDQFLDOV\VWHP14. for food items, which was high due to preparation IRUIRRGLWHPVZDVQRWHGLQWKHȴUVWFRXSOHRI
cargo transit, though with export restrictions put Importers and wholesalers explained that they for stricter lockdown measures, as well as partly in weeks from the moment of curfew implementation,
LQSODFHE\-RUGDQLDQDXWKRULWLHVVSHFLȴFDSSURYDOV had experienced delays in importation or arrival preparation for Ramadan festivities. followed by a slight levelling of prices in-line with
ZHUHQHFHVVDU\IRUWKHLPSRUWRIZKHDWȵRXUWR of shipments during March 2020, when the main Wholesalers advised that typically during Ramadan the loosening of restrictions in April and early
Syria. There were also some positive developments food producing countries started introducing they tend to work 24 hours a day, seven days a week May. This period of relative price stabilization also
on facilitation of importation and granting of import lockdowns15. Data from Oxford University’s ZLWKWKUHHGLHUHQWVKLIWVIRUZRUNHUVWRHQVXUH coincided with the second part of Ramadan, when
license, including a decree issued on 29 March Coronavirus Government Response Tracker (Map supply meets demand. This year, due to COVID-19 the demand for goods typically falls.
2020 that allowed traders to import wheat, which 2 below) clearly indicates that as of 31 March, the
had previously been restricted only to GoS. strict measures put in place globally corresponded
It is worth noting that problems encountered with to the challenges faced in the delays in importation
the importation of wheat over the past year have of food items into Syria during March and April, as
been linked primarily to the issue of accessing they prepared for the surge in demand during the
foreign currency, rather than to COVID-19 or month of Ramadan (23 April – 23 May 2020).
related mitigation measures. It has been reported
©WFP/Jessica Lawson
KWWSV ZZZGU\FDUJRPDJFRPJOREDOVKLSSLQJKLWE\FRURQDYLUXV
KWWSV V\ULDGLUHFWRUJQHZVGDPDVFXVVWUXJJOHVWRVHFXUHZKHDWVXSSO\DPLGVWFRURQDYLUXVFULVLV
15
KWWSV ZZZEVJR[DFXNUHVHDUFKUHVHDUFKSURMHFWVFRURQDYLUXVJRYHUQPHQWUHVSRQVHWUDFNHU
16
0DS 6\ULDȂ0DLQZKHDWSURGXFWLRQDUHDVDQGȵRZV
SECTION 3
IMPACT ON SYRIAN
FOOD MARKETS
LOCAL FOOD MARKET
CONDITIONS
Syria has historically been a strong
agrarian economy. Much of the
country’s cropland lies in the north-
east, north and central parts of
the country, including notably the
governorates of Al-Hasakeh, Ar-
Raqqa, Aleppo, Hama, Homs, and
Rural Damascus. Agriculture in the
western governorates of Lattakia,
Tartous and Idleb is known to largely
centre on citrus fruits, apples, olives 6\ULDLVFXUUHQWO\DZKHDWGHȴFLWFRXQWU\PHDQLQJ (the 2019 Food Security Assessment/Food Security
and vegetable cultivation. While the it does not produce enough wheat annually to and Livelihoods Assessment (FSA/FSLA)) found that
Badia region, a stretch of semi-arid meet its own needs. In 2019, wheat production 89 percent of Syrians reported markets as their main
land in central Syria covering around was 2.2 million tonnes, below the estimated total source of food.
55 percent of the country, is primarily utilization requirement of 4.5 million tonnes (of Even though historically being an agricultural
used for livestock grazing. which 3.5 million tonnes is for food use) and below country, years of crisis and resulting mass
the 4.1 million tonnes pre-crisis (2002-11) national displacement of people from their land, as well
While Syria cultivates a number of crops; average production level. In 2020, it is estimated as heavy infrastructural damage and looting, has
namely barley, cotton, tobacco, sugar that wheat production in Syria will be around 2.8 meant that Syrians now more than ever depend
beet, lentils, chickpeas, fava beans, million tonnes with only around 0.8 million tonnes on imports for their food security, economic
peas, vegetables, citrus fruits, olives and produced in GoS controlled areas16. production and access to key non-food items. Some
herbs, its main staple is wheat. Up to 40
Syria heavily depends on markets for its food NH\LPSRUWHGFRPPRGLWLHVDUH ULFHZKHDWȵRXU
percent of wheat grain is cultivated in
security. Already in 2010 over 50 percent of Syrians vegetable oil, sugar, tea, fertilizer, petrol, sanitary
Al-Hasakeh governorate, with Ar-Raqqa,
were reported to be living in urban areas, making products, medicine, vaccines and replacement
Aleppo, Hama and Homs governorates
markets essential in providing Syrians with their food items for machines. However, more than nine years
contributing much of the remaining 60
needs. The crisis, international sanctions, and the RIFULVLVKDVFULSSOHGWKHȴQDQFLDODELOLW\RIPDQ\
percent. Some wheat is also cultivated
more frequent erratic weather patterns experienced traders to purchase goods and has limited the
in Rural Damascus governorate and in
by Syria over the last 50 years has meant that ever purchasing power and liquidity of consumers. This
the southern governorates of Dar’a and
more Syrians are depending on markets to meet KDVUHVXOWHGLQWUDGHUVQRWȴQGLQJDGHTXDWHEX\HU
Quneitra and in the irrigated land of Deir-
their food needs. National food security assessments markets for their commodities, as well as forcing
ez-Zor governorate. As a result, much of
conducted in 2019 by WFP and the Central Bureau traders to buy and store fewer goods as a risk-
©WFP/Tarek Jacob
WKHZKHDWWUDGHȵRZJRHVIURPQRUWKHDVW
of Statistics as well as with the Food Security Cluster mitigation measure to avoid losses.
and northern parts of the country towards
western and southern Syria (Map 3).
$O-D]HHUD Ȋ6\ULDIDFHVVHYHUHEUHDGVKRUWDJHVDV86VDQFWLRQVZRUVHQHFRQRP\ȋKWWSV ZZZDOMD]HHUDFRPDMLPSDFWV\ULDIDFHVVH-
YHUHEUHDGVKRUWDJHVVDQFWLRQVZRUVHQHFRQRP\ KWPO
18 THE SOCIO-ECONOMIC IMPACTS OF THE COVID-19 PANDEMIC IN THE SYRIAN ARAB REPUBLIC 19Increases in fuel prices and the depreciation of the COVID-19 has added a further layer of complexity IMPACT ON TRADERS
Syrian pound meant that food prices in Syria had to the context, forcing all non-food businesses
already been on the rise since late 2018. However, and non-essential services to temporarily shut The high degree of disruption to traders’ business Minister was relieved of his duties on 11 June and by 16
IRRGSULFHLQFUHDVHVDFFHOHUDWHGVLJQLȴFDQWO\LQ while food businesses had to restructure their caused by the worsening economic situation in June the Syrian Central Bank announced the devaluation
Lebanon and Syria, which has been further deepened of the Syrian currency from SYP 700/USD 1 to SYP 1,250/
2019, especially after the start of the Lebanese operations to ensure they complied with the
by the temporary COVID-19 movement restrictions USD 1. These measures have for the time being (as
ȴQDQFLDOFULVLVLQ2FWREHU 7KHȴQDQFLDO required COVID-19 mitigation measures. While
and business closures in Syria, is evident. Every day, of mid-September 2020) succeeded in stabilizing the
crisis caused banks in Lebanon to restrict release most COVID-19 movement restriction measures
QXPHURXVDUWLFOHVVSHDNRIWKHHHFWVRIGHHSURRWHG informal exchange rate which by mid-September 2020
of funds to bank account holders. Many Syrians KDYHVLQFHEHHQOLIWHGWKHFRPELQHGHHFWRI
structural economic problems in the country, without had gradually reduced to around SYP 2,200/USD.
have a bank account in Lebanon and as such are business closures as well as Ramadan festivities
failing to report on the most recent increases in the price
no longer able to access their savings17, which led to panic-buying and as a result, to an increase Nevertheless, a number of protective measures were
of goods, and the latest disruptions to the economic
are estimated to amount to around 45 billion US in the price of commodities. The increase in prices introduced by some regions in Syria in June 2020 to
and agricultural sectors. All highlighting the increased
dollars18. The inaccessibility of US dollar accounts in KDGDOUHDG\EHHQDHFWLQJ6\ULDEHIRUH&29Ζ' 19 guard them from the impact of a possible further
inability of Syrians to purchase their required needs.
Lebanon has heavily impacted Syrian traders who and has continued since the main COVID-19 related weakening of the Syrian pound. For example, cities in
Remittances, a key lifeline for many Syrians have
used Lebanese banks to facilitate their trade on restrictions were removed, outlining the much opposition-held north-western Syria such as in Afrin,
DOVREHHQDHFWHG)RUH[DPSOHWKH6\ULDQ0LQLVWU\
Azaz, Al-Rai, Marea, Jarablus, Al-Bab and part of Idleb,
the international market. With reduced availability deeper underlying structural economic issues of Agriculture and Agrarian Reform (MAAR) recently
announced in mid-June the adoption of the Turkish Lira
of US dollars on the Lebanese market, demand on instigating the rise in prices of goods in Syria. announced that more than 70 percent of chicken
due to the weakening SYP. The Turkish Lira is now a
US dollars grew in Syria and the Syrian currency Nevertheless, COVID-19 containment measures are farmers in Syria stopped production due to the high
legal currency in these areas. Furthermore, the Kurdish
started depreciating ever faster vis-à-vis the US further impacting prices in Syria, and a similar trend costs of production (mainly linked to the high cost of
Self Administration (KSA) issued two decisions on 06
dollar, which in turn pushed-up commodity prices. can be expected if movement restriction measures key feed ingredients such as soybean and maize)20, and
-XQHWKDWHHFWLYHO\SURKLELWVWKHVDOHRIZKHDWJUDLQE\
are re-imposed in the coming months. since the article was written (25 June 2020) another
farmers to other actors in Syria in an attempt to ensure
seven poultry farms have been reported to have gone
wheat grain would not be sold elsewhere. This will likely
out of business in Quneitra21. Moreover, butchers are
lead to reduced wheat supply for the Syrian government
reporting that sales of lamb meat are down 80 percent
in the 2020-21 marketing year.
compared to levels last year, due to the high price of
meat and people’s low purchasing power which had a )ROORZLQJWKHRɝFLDOGHYDOXDWLRQRIWKH6\ULDQSRXQG
heavy impact the meat industry. Key industries such as to SYP 1,250/USD, the Central Bank of Syria announced
pharmaceuticals22 and packaging factories have also on 21 June 2020 that as a result of reduced US dollar
EHHQIHHOLQJWKHHHFWVRIWKHHFRQRPLFFULVLVΖQFUHDVHG liquidity, from July 2020 onwards, it will no longer
crime rates have been reported23, especially in urban include food in its priority commodities for accessing
areas and there have also been reports of people US dollars26. This announcement sent shockwaves
resorting to sale of organs on the informal market to through the country as food imports such as rice,
make ends meet24. sugar, wheat and vegetable oil, which Syrians heavily
consume and traders import and sell-on, will see
The external economic context further constricted in further price hikes and will likely no longer be imported
June 2020, when the United States’ Caesar Syria Civilian in the future. Wholesalers are already reviewing their
Protection Act (also known as the ‘Caesar Act’) came business models and some large Syrian wholesalers WFP
into force, imposing additional unilateral sanctions LQWHUYLHZHGLQ-XQHFRQȴUPHGWKDWLIWKHUHLVQR
DQGȴQDQFLDOUHVWULFWLRQVRQERWK6\ULDQDQGIRUHLJQ change on accessing foreign currency, the wholesalers
individuals and organizations doing business with the will stop importing food items, as it would no longer
government of Syria. The Caesar Act sanctions have be economically feasible for them to import the items,
further limited possible trade deals by Syria with foreign seeing that they would have to purchase the US dollars
countries and companies25$NQRFNRQHHFWRIWKH on the informal market (which is illegal and punishable
worsening macro-economic environment in Syria has with a three year prison sentence) at a rate which
been the extreme volatility of the value of the Syrian
currently is around SYP 2,200/USD, while the traders
pound, which plummeted from SYP 1,775/USD 1 on 01
would be subjected by government regulation to sell
June to SYP 3,200/USD 1 on 08 June to then stabilise
WKHLULPSRUWHGLWHPVDWWKHRɝFLDOH[FKDQJHUDWH 6TRADER SURVEY FINDINGS27 When looking further into detail at retailers’ while for retailers an average 35 percent more
responses in Table 2 we can divide them into two customers requested credit in May-June 2020 than
With the backdrop of these troubling economic variety of products available on local markets at FDWHJRULHV WKHȴUVWFDWHJRU\LQFOXGHVUHWDLOHUV before 15 March 2020. However, CBT retailers
trends, WFP in May and June 2020 conducted increased prices. currently contracted by WFP in the framework of reported considerably fewer percent of customers
phone and face-to-face interviews with 230 retailers In terms of stock levels of commodities, wholesalers the cash based transfer programme (CBT retailers), requesting credit (42 percent) compared to the pre-
and wholesalers across Syria. WFP conducted mentioned that on average their stock holding WKURXJKZKLFKEHQHȴFLDULHVDUHSURYLGHGZLWKDQ COVID period than non-CBT retailers (75 percent),
interviews with 81 retailers and 27 wholesalers in volumes fell by around 42 percent between mid- unrestricted value voucher to access food at retailer OLNHO\EHFDXVHZLWKWKH&%7YRXFKHUEHQHȴFLDULHV
May 2020 and 90 retailers and 32 wholesalers in March 2020 and June 2020. The commodities that outlets; and retailers not currently contracted by were less in need for credit.
June 2020. The interviews covered traders trading reported the biggest stock reductions were sugar WFP, which for simplicity will be called “non-CBT
in dry food commodities such as grains, sugar, Even though credit requests have been increasing,
(50 percent), canned tuna (48 percent), vegetable retailers” in this report. From Table 2 we can see wholesalers reduced their provision of credit
vegetable oil, pulses and canned food, traders RLO SHUFHQW ZKHDWȵRXUDQGZKLWHULFH that CBT retailers tend to be less worried than
trading in fresh food commodities such as fruit and from an average 63 percent of customers in May
percent) and pulses (32 percent). The reductions non-CBT retailers about running out of stock. The to 31 percent in June, while retailers reduced
vegetables as well as livestock traders. The retailer were led by supply disruptions, a weaker Syrian UHDVRQLVOLNHO\WKHFRQVWDQWDQGSUHGLFWDEOHȵRZ
interviews covered 109 traders not currently provision of credit to customers from an average
pound and worsening customer purchasing power RILQFRPHIURP:)3EHQHȴFLDULHVUHGHHPLQJWKHLU 52 percent in May to 40 percent in June. In terms
holding a contract with WFP and 62 traders DHFWLQJGHPDQG vouchers at their shop on a monthly basis, which
currently holding a contract with WFP to asses if RIWKHGLHUHQFHEHWZHHQ&%7UHWDLOHUVDQGQRQ
HQVXUHVDFRQVWDQWȵRZRILQFRPHHYHQWKRXJK CBT retailers, the former tends to give credit to
having a business partnership with WFP through When questioned if they were worried of stocks
sales outside the CBT programme are diminishing. fewer customers than the latter, while the average
WFP’s cash-based transfers (CBT) activities enabled running out, 26 percent of interviewed wholesalers
The only exception to this trend seems to be total amount of credit provided compared to the
WUDGHUVWRPDQDJHWKHLUEXVLQHVVGLHUHQWO\DQG in May mentioned that they thought they would run
oil, fats and sugar which CBT retailers are more previous month’s sales was the same for both
ensured traders were able to address the impact of out within 30 days compared with 38 percent in
concerned to run out of than non-CBT retailers. CBT-retailers and non-CBT retailers (21 percent
the economic turmoil on their business better. -XQHKLJKOLJKWLQJKRZ-XQHVLJQLȴFDQWO\ZRUVHQHG
wholesaler supplies. The key items wholesalers Increased prices and reduced purchasing power of their previous month’s total sales) an amount
3UHOLPLQDU\ȴQGLQJVIRXQGWKDWZKLOHQDWLRQDO were worried they would run out of were sugar and have also led to more credit to be requested to which did not vary much between May and June.
wholesalers continued supplying their products vegetable oil (reported by 68 percent of interviewed wholesalers and retailers by their customers. Wholesalers instead saw a reduction in the amount
country-wide, it was the smaller wholesalers based wholesalers), followed by white rice (32 percent of Up to 75 percent of wholesalers and 64 percent of previous month’s sales that were on credit, which
outside of Damascus who primarily experienced LQWHUYLHZHGZKROHVDOHUV DQGZKHDWȵRXUSXOVHV of retailers reported that there had been an reduced from 37 percent in May to 21 percent in
a reduction in their geographical coverage for and canned tuna (16 percent of interviewed increase in the request of credit by their customers -XQHKLJKOLJKWLQJDVLJQLȴFDQWUHGXFWLRQLQSURYLGHG
trade. Around 19 percent of interviewed wheat wholesalers). compared to the pre-COVID (before 15 March) credit which has led to reduced purchasing
ȵRXUZKROHVDOHUVUHSRUWHGUHGXFHGJHRJUDSKLFDO period. For wholesalers the average increase volumes for retailers depending on wholesalers to
coverage (no longer trading in certain governorates) Table 2 below outlines the percent of interviewed
in number of customers requesting credit was supply them with goods. It is also worth mentioning
in May and June compared to the pre-COVID-19 retailers who believe they will run out of
30 percent higher than before 15 March 2020 that the overall decrease in the credit extension has
(February 2020) period, followed by a 12 percent commodities in the coming 30 days. Oils, fats (ghee
reduction of geographical coverage by wholesalers and butter) and sugar are the commodities which
trading in pulses, 11 percent reduction by were least supplied compared to their demand
©WFP/Tarek Jacob
ZKROHVDOHUVWUDGLQJLQZKLWHULFHȴYHSHUFHQW across Syria, with the highest percent of traders
geographical reduction by wholesalers trading in reporting to likely run out of these commodities,
fruit and vegetables. No changes in geographical followed by cereals, canned tuna, non-food
market coverage were reported for sugar, vegetable LWHPVDQGPHDWVȴVKDQGHJJVURRWVDQGWXEHUV
oil and canned tuna. The geographical coverage legumes, herbs and spices, fruits and vegetables,
reductions reported by wholesalers between May/ dairy and livestock. It is evident by the responses
June 2020 and February 2020 are a likely indication that imported commodities are the ones most
of changing supply chain dynamics, which may lead at risk of running out of stock. The worsening
to trade business closures for some, and growing exchange rate is very likely the cause, as these
monopolization of segments of the market by products are relatively more expensive to import
others. This in turn would likely lead to a reduced now for traders and are also more expensive for
consumers to buy than before.
Table 2: Percent of retailers mentioning that are worried they will be out of stock in 30 days
Source: WFP
2QO\WKHNH\ȴQGLQJVRIWKHWUDGHUVȇLQWHUYLHZVKDYHEHHQLQFOXGHGLQWKLVVHFWLRQ$PRUHLQGHSWKUHYLHZGHOYLQJGHHSHULQWRWKHLQWHUYLHZ
ȴQGLQJVZLOOEHSURYLGHGLQDVHSDUDWHUHSRUW
22 THE SOCIO-ECONOMIC IMPACTS OF THE COVID-19 PANDEMIC IN THE SYRIAN ARAB REPUBLIC 23also been led by the rapidly changing exchange rate ZKHDWȵRXUGRZQSHUFHQWDQGYHJHWDEOHVDQG Chart 1: Wholesalers’ top constraints to trader since Chart 2: Retailers’ top constraints to trader since 15
15 March 2020 March 2020
DQGVRDULQJLQȵDWLRQZKLFKDVDUHVXOWJHQHUDWHV fruit down 17 percent.
greater losses for traders extending credit. Retailers are also reporting big reductions in their
Considering reduced credit availability, traders have customers’ purchasing patterns compared to
been reporting big reductions in their customers’ before 15 March 2020. Retailers reported in June,
purchasing patterns compared to pre-COVID times. that 80 percent of their customers reduced their
Wholesalers reported that in June 72 percent of purchases, this was up from 64 percent in May.
their customers had reduced their purchases, The main commodities traders reported families
this was up from 67 percent in May. The main are buying less of are: canned tuna (down 59
commodities retailers are buying less of from percent), followed by vegetable oil and fats (down
wholesalers are vegetable oil and white rice which 54 percent), sugar (down 47 percent), cereals (down
are both down 66 percent compared to pre-15 38 percent) and meat and eggs (down 35 percent).
March 2020 followed by sugar and pulses both A further breakdown per commodity is available in
down 61 percent, canned tuna down 44 percent, Table 3.
When comparing retailers’ answers on top mentioned client liquidity and shortage of supply
Table 3: Items customers are buying less of than before 15 March constraints to trade by their service extension to from wholesalers as a top constraint, this was not
CBT, more CBT retailers rate high prices as a top the case for CBT-retailers. Highlighting that CBT-
constraint than non-CBT retailers while more non- UHWDLOHUVDUHQRWDVDHFWHGE\FOLHQWOLTXLGLW\VLQFH
CBT retailers reported the unstable exchange rate :)3EHQHȴFLDULHVUHFHLYHYRXFKHUVWRVSHQGLQ&%7
as a top constraint than CBT retailers. Although retailer shops. Furthermore, CBT retailers are not
PRUH&%7UHWDLOHUVUHSRUWHGWRKDYHGLɝFXOW\ DVDHFWHGE\VKRUWDJHRIVXSSO\IURPZKROHVDOHUV
with the COVID-19 movement restrictions than likely because wholesalers know that WFP will be
non-CBT traders, an equal percent of interviewed paying the retailers and therefore there is less
Interviewed traders reported that on average, eggs. Highlighting, the degree to which rising food traders mentioned reduced operating hours (due risk for the CBT retailer defaulting on paying back
families purchased 70 percent less livestock in prices and limited household purchasing power is to COVID-19) as a top constraint. Furthermore, wholesaler supplies.
May-June 2020 compared to pre-15 March 2020, DHFWLQJKRXVHKROGVȇOLYHOLKRRGVIRRGVHFXULW\DQG of interest is that while some non-CBT retailers
followed by 62 percent reduction in quantity of nutrition. A further breakdown per commodity is Chart 3: CBT retailers’ top constraints to trader since Chart 4: Non-CBT retailers’ top constraints to trader
canned tuna, 54 percent reduction in non-food available in Table 4. 15 March 2020 since 15 March 2020
LWHPVDQGSHUFHQWUHGXFWLRQLQPHDWȴVKDQG
&29Ζ' P ovHPent restULFWions
/DFN oIRZn FDSLtaO 1 0%
Table 4: Average percent decrease in customer purchases by item in May-June 2020 compared to pre-15 March
&29Ζ' r eduFHd
RSeratinJ houUV5%
FeZSHRSOHFRntroO the
PDUNet 1%
+LJKSULFHV RI
2WheU% FRPPoditLHV %
+LJK interest rate o n
FUHGit0%
ShortaJH o IsuSSO\IroP
ZKROHVDOHUV %
COLHQtsO LTuidity
With a worsening economic situation, traders prices as they likely have limited capital compared avDLODELOLty%
were asked to outline what have been their top to wholesalers and therefore are less able to /RZdePDQG
8QstabOH H[FKanJH r atH
%
constraints to trade since 15 March 2020. Charts face the increased procurement costs as well as
1 and 2 below outline the top constraints for the reduced income from customers spending
©WFP/Khudr Alissa
wholesalers and retailers (includes both CBT less. A lack of own capital and client liquidity were
and non-CBT retailers), respectively. While both issues reported by both wholesalers and retailers
wholesalers and retailers noted the unstable alike. COVID-19-related constraints (movement
exchange rate and high prices to be their top restrictions and reduced operating hours) were
constraints since 15 March, the unstable exchange also mentioned as a key constraint for both
UDWHDHFWHGZKROHVDOHUVPRUHDVWKH\DUHPRUH wholesalers and retailers even though rates were
engaged with imports than retailers, while retailers much lower than for the unstable exchange rate
reported having greater trouble with the high and high prices.
24 THE SOCIO-ECONOMIC IMPACTS OF THE COVID-19 PANDEMIC IN THE SYRIAN ARAB REPUBLIC 25©WFP/Fadi Halabi
SECTION 4 PRICE MONITORING
METHODOLOGY
MARKET PRICE TRENDS
WFP monitors the price of
commodities on a weekly basis
from 57 markets across Syria
(Map 4). In total the prices of
47 commodities are monitored,
and of these, 36 commodities
are food items. The price of each
commodity is monitored from at
OHDVWWKUHHGLHUHQWWUDGHUVSHU
market and averaged by market to
address possible outliers in price
data collection. All governorates
in Syria are covered by WFP’s food
price monitoring system which
covers both urban and rural
markets in each governorate. Food
price data has been collected in
Syria since May 2013 allowing for
trend analysis, and all food price
data is made freely accessible at:
https://dataviz.vam.wfp.org/
economic_explorer/prices
A full breakdown of prices of key food
and non-food items between October
2019 and June 2020 can be found in
Annex 2 at the end of this report.
Map 4: WFP Syria Food Price Data Collection
26 THE SOCIO-ECONOMIC IMPACTS OF THE COVID-19 PANDEMIC IN THE SYRIAN ARAB REPUBLIC 27SYP/USD EXCHANGE RATE :KHQORRNLQJVSHFLȴFDOO\DWWKH&29Ζ' PRYHPHQW fuelled uncertainty and speculation in the Syrian
restriction period (from the third week of March to economy and led to a worsening of the informal
ΖQHDUO\2FWREHU WKHRɝFLDO6CEREAL PRICES BULGUR
In June 2019, the national average price of bulgur white rice increased by 36 percent (reaching SYP
WHEAT FLOUR was SYP 318/kg. In October 2019, the national 1,214/kg).
7KHSULFHRIFHUHDOV ZKHDWȵRXUULFHDQGEXOJXU (reaching SYP 939/kg), highlighting how deeper average price of bulgur increased to SYP 348/
across Syria has been increasing since October structural economic factors are at play in Syria and Chart 11: Retail prices of bulgur, SYP
kg (up two percent m-o-m). By March 2020, the
2019 along with the general price increases DUHKDYLQJPRUHVLJQLȴFDQWLPSDFWRQSULFHVWKDQ price nearly doubled, reaching SYP 648/kg (up 17
experienced across Syria since the onset of the the COVID-19 movement restrictions. percent m-o-m). It then increased by 18 percent in
/HEDQHVHȴQDQFLDOFULVLVΖQ-XQH WKHSULFH &KDUW 5HWDLOSULFHVRIZKHDWȵRXU6increase, as panic buying subsided when bakeries RIWKH6\ULDQSRXQGDQGWKHLQWHQVLȴFDWLRQRI PRICE OF FRUITS AND VEGETABLES
remained open and more bread selling points sanctions, this will likely result in Syria facing
The price of fruits and vegetables in Syria is largely soared by 104 percent during the last two weeks
were made available. Throughout April, the price VLJQLȴFDQWVKRUWDJHVRIZKHDWLQWKH
dependent on the season, as prices are heavily of March 2020 and the price of garlic increased by
of commercial bread continued to fall, reaching marketing season.
LQȵXHQFHGE\ORFDOSURGXFWLRQOHYHOV:KLOHWKHSULFH 100-200 percent over the same period. The price
SYP 179/bundle; six percent above the prices seen The Government of Syria has already this year of some locally grown vegetables such as tomatoes, of lemons and oranges also increased by around
before the COVID-19-related sudden price spike in announced that it has reduced its farmer wheat onions and potatoes started falling over the harvest 70-80 percent across Syria over the last two weeks of
the third week of March. However, throughout May quality acceptance rate further, after already having period (declining by 16 percent, 30 percent and March.
the national average price of commercial bread reduced the acceptance standards in 2019 in an 39 percent, respectively from May to June 2020), In June, some fruits and vegetables were reported
started to increase once again due to a consistent attempt to increase the volume of wheat gathered vegetable prices have increased overall due to to be scarce or unavailable on local markets
deterioration of the informal exchange rate which from farmers. Furthermore, the KSA on 30 May the depreciating informal exchange rate, as most either due to seasonality or due to price increases
pushed up the price of all goods across the country. 2020 increased the price of wheat to farmers from vegetables have not reached their main harvest resulting from heavy depreciation and the volatility
The price of a commercial bread bundle increased SYP 225,000/tonne to 315,000/tonne. The following period, (during the summer months). The price of of the informal exchange rate. Imported fruits were
to SYP 294/bundle by the second week of June and day the GoS raised its wheat bid to SYP 400,000/ IUXLWVDQGYHJHWDEOHVKDYHDOVREHHQDHFWHGE\ SDUWLFXODUO\DHFWHGDVWKHLUSULFHVKHDYLO\LQFUHDVHG
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