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Country Briefs

  Syrian Arab Republic

Reference Date: 19-May-2020

FOOD SECURITY SNAPSHOT

  1. Favourable cereal production prospects, but structural issues continue to constrain agricultural activities

  2. Stable import requirement forecast in 2020/21 marketing year

  3. Elevated prices, stagnant salaries and high unemployment rates increase food insecurity

Favourable cereal production prospects, but structural issues continue to constrain agricultural activities

The harvest of the 2020 barley crop started in early May, while wheat will be harvested from the end of May. Ample and well‑distributed rainfall maintained favourable crop conditions throughout the season. About 1.3 million hectares were planted with wheat in autumn 2019, slightly less than the 1.35 million hectares of the previous year. Usually not the entire area planted is harvested due to a variety of reasons, such as pests and diseases or accidental field fires: in the previous year, about 94 percent of planted area was harvested. Assuming favourable weather conditions prevail until the harvesting period, the 2020 wheat production is forecast at 2.6 million tonnes, up from 2.2 million tonnes in 2019, but still well below the pre‑crisis level of 4.1 million tonnes (2002‑2011). Although similar favourable conditions prevailed in 2019, high temperatures in May 2019 had an adverse effect on wheat grain filling, constraining yields.

For the 2020 harvest, barley was planted on an estimated 1.499 million hectares, slightly more than the 1.456 million hectares planted in the previous year, out of which 92 percent was harvested. An above‑average harvest of 1.7 million tonnes is forecast, more than double the pre‑crisis average. To obtain a better price, barley is often informally traded to Lebanon.

The General Establishment for Cereal Processing and Trade (Hoboob) remains the exclusive purchaser of wheat. For the current season, the Government allocated SYP 450 billion for wheat purchases and, out of this amount, SYP 150 billion was already transferred to the Agricultural Bank to be disbursed to farmers. The 2020 purchasing prices for first grade wheat were set at SYP 225/kg (equivalent to USD 0.18/kg), with a bonus of SYP 25 for delivery included. The purchasing price for the same grade in 2019 was SYP 185/kg, including a bonus of SYP 15. In previous years, most grain purchased by Hoboob fell into the second grade category, for which payment is slightly less. To sell to Hoboob in the past, farmers had to purchase new hessian sacks and deliver them to the collection place. Other entities were purchasing grain at the same price as Hoboob, but collecting it on farms and not requiring the use of new sacks. Reports indicate that, this year more bags for selling to Hoboob will be available for purchase by Hoboob.

Farmers continue to be concerned about the high production and transportation costs as well as the lack of quality inputs. Despite the Government’s initiatives to increase the availability of farm machinery, it generally remains insufficient. Some progress has been made on the rehabilitation of irrigation structures, although many farmers report lack of maintenance. Wastage of fruit and vegetable production continues to be high as a consequence of low consumer purchasing power, lack of export markets and the shortage of domestic processing factories.

Stable import requirement forecast in 2020/21 marketing year

The country normally relies heavily on food imports, amounting to almost half of the total domestic utilization. Overall, cereal import requirements in the 2020/21 marketing year (July/June) are forecast at 2.7 million tonnes, similar to the previous year and about 15 percent below the five‑year average. Most of the cereal imports are sourced from the Russian Federation.

Press reports indicate problems in securing wheat imports in 2020 because of logistical difficulties, expensive freight and insurance costs due to sanctions imposed on the country. In late March, the Government, normally the exclusive importer of wheat via Hoboob, granted a permission to the private sector to import also wheat flour for bread baking purposes and not, as in the past, only wheat flour to produce pasta.

Elevated prices, stagnant salaries and high unemployment rates increase food insecurity

The entire economy, already battered by nine years of conflict, suffers spill over effects from the economic and financial crisis in Lebanon where the shortage of US dollars and informal capital controls introduced by the banks have constrained withdrawals denominated in US dollars as well as foreign transactions. In the past, many Syrians kept their US dollar deposits in Lebanese banks that paid generous interest rates and were considered a store of value. Imports of goods to the country are particularly affected as many traders rely on their accounts in Lebanon to finance transactions. Following the introduction of capital controls in Lebanon in October 2019, traders started purchasing US dollars on the parallel market in the Syrian Arab Republic, putting an upward pressure on the exchange rate. In September 2019, USD 1 was traded for SYP 600, while in May 2020 it was sold for SYP 1 550. The Central Bank of Syria maintains two rates: the official rate at SYP 435 per US dollar and an intermediary rate of SYP 706 per US dollar used for import financing, remittances, and selling of US dollars to the Central Bank.

The rapid devaluation brought industrial production to a stand‑still, as industrialists were unable to purchase inputs, with a consequent increase in unemployment rates.

In April 2020, the price of a World Food Programme (WFP) reference food basket (bread, rice, lentils, sugar and vegetable oil) increased on average by 107 percent across the country compared to April 2019. The largest increases were recorded in Sweida (152 percent), Hama and Homs (each at 133 percent). Between March and April 2020, the cost of the basket increased by 20 percent, mainly due to stockpiling by households facing the COVID‑19 pandemic.

A smart card system, previously used only for fuel products, was expanded in February 2020 to include rationed quantities of rice, tea and sugar. Every month, each family is allowed to purchase up to 1 kg of tea (at SYP 900 per 200 gr), 3 kg of rice (at SYP 400 per kg), and 4 kg of sugar (at SYP 350 per kg). The Government is considering using the smart card also to allocate subsidised bread. Although no formal rationing of bread exists at the moment, bakeries have already been informally rationing bread.

In November 2019, the Government raised the salaries of public employees by SYP 20 000 and pensions by SYP 16 000. Imports that are paid in US dollars are banned for those goods that have a domestically produced alternative on the markets.

According to the nationwide assessment conducted by the WFP in 2019, there are 7.9 million people unable to meet their food needs and a further 1.9 million are at risk of food insecurity. This figure is likely to increase in 2020 as a result of the high food prices, stagnant wages and limited livelihood opportunities.

As of early March, the humanitarian situation remains dire in the northwest where about 840 000 of the nearly 1 million people displaced between December 2019 and early March 2020 reportedly remain in displacement.

As of late January 2020, over 5.6 million Syrian refugees were registered in Egypt, Iraq, Jordan, Lebanon and Turkey. The number of registered refugees has been stable since early 2018. In addition, a large number of Syrians live abroad without seeking refugee registration.

COVID‑19 and measures adopted by the Government

The country started implementing containment measures on mid‑March 2020, including public health requirements, restrictions on movements and gatherings, closure of markets as well as the adoption of social distancing measures. Curfews, originally running from 18:00 to 06:00 hours, were eased to 19:30 to 06:00 hours during the Ramadan. Markets are opened from 08:00 to 15:00 hours. Some geographic areas are in total lockdown. Curfew violations in the northeast part of the country are fined from SYP 5 000 to SYP 45 000.

Most land borders are closed; exceptions include some trans‑border movements of goods (both commercial and relief) and movements of humanitarian and international organizations personnel. Travel within and between governorates is banned, with the exception of emergency, humanitarian and essential services. As all schools were closed on 15 March 2020, the provision of WFP school feeding assistance to more than 1 million children was suspended.

The COVID‑19 outbreak aggravated the already challenging situation that the country has been facing amidst high unemployment rates, rapid currency devaluation and the absence of an adequate social safety net system. Many casual labourers rely on their daily wages. The Government was considering to compensate each worker affected by the lockdown with SYP 100 000, but the plan lacked the fiscal coverage.

The Government allocated SYP 100 billion to confront the epidemic, although the details of the programme have not been provided. It is foreseen that some tax exemptions will be granted to businesses.

To keep the markets well supplied, the Government has simplified the requirements for importing food and medicine. Temporary export bans have been put in place for medicines, bleach as well as some food products.

Among international efforts, in mid‑March 2020, the Government requested the international community to lift the sanctions to increase the capacity of the national health system to cope better with the COVID‑19 outbreak.

Fears persist that a high concentration of people in displacement camps, not well suited to practice social distancing, would facilitate the transmission of the disease.

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