Enab Baladi – Amir Huquq
The ongoing economic crises and poor decisions during the previous regime have led to the closure of many factories, alongside the destruction of others due to bombing and battles, thereby reducing Syria’s industrial capability.
Economic circles in general, and industrial ones in particular, have called for support for local industry and efforts to revive it as it is one of the fundamental pillars related to improving and revitalizing the national economy, with its weak production hindering the recovery of the economy.
However, the current situation shows a decline in production activity, especially with several industrial facilities ceasing operations since the fall of the regime due to obstacles facing industrialists.
Ministry of Industry’s role is “missing”
Industrialist Abdul Rahman al-Shanour stated to Enab Baladi that he halted operations at his cleaning materials factory in Daraa due to the influx of Turkish goods in the markets at lower prices compared to local products.
According to the industrialist, the cost of local goods, excluding profit, exceeds the price of foreign goods in the markets, thus local products have lost market share, resulting in significant losses for industrialists.
He called for opening exhibitions and local and foreign markets for national goods, supporting them through laws and decisions, providing facilities, and listening to the concerns of industrialists, as the Ministry of Industry has not communicated with them or heard their demands and complaints.
Industrialist Sameh al-Saeed had to close his clothing factory in Aleppo due to several reasons, the most important being the influx of Turkish clothing of varying quality, rising energy costs, particularly electricity, tax policies, fluctuating dollar exchange rates, and the absence of government support for national industry.
He continued during his conversation with Enab Baladi that the economic policies implemented after the regime’s fall have increased challenges for national industry, such as adopting a free market economy without regulations and not establishing a customs system for foreign goods that fairly represents national industry.
The head of the Al-Arqoub Industrial Committee at the Aleppo Chamber of Industry, Taysir Derklet, told Enab Baladi that the halt of industrial facilities is due to many reasons, including the years of war that have exhausted industrialists, the prevailing tax system, as well as the rise in electricity prices and the delay in issuing the new pricing, which did not meet expectations.
He considered that the influx of foreign products has had a compounded effect on the Syrian industry, which is already weakened and unable to compete or enter into a free market economy, and stressed the need to consider local industry.
Customs tariff supporting industry
Supporting local industry represents a strategic step towards achieving comprehensive and sustainable development and is essential to ensure the national economy’s ability to recover and grow.
Hassan al-Ahmad, Director of the Media Department at the Ministry of Economy and Industry, informed Enab Baladi that the ministry is working to enhance the industrial sector by promoting local production and supporting local industries. This is achieved through implementing policies and incentive measures aimed at developing industries.
The ministry focuses on encouraging the private sector and attracting capital, according to al-Ahmad, in addition to providing tax facilities that enhance local production and develop strategic industries.
The Media Department Director stated that the ministry recognizes the challenges faced by business owners due to competition with foreign products; thus, a customs tariff has recently been issued to support local industry. An in-depth study of this tariff is underway to meet the needs of industrialists, and the ministry is also working to follow up on and study the obstacles hindering the return of strategic facilities to work.
The ministry’s plan includes enhancing local industries and establishing a culture of production by relying on Syrian skilled labor domestically, encouraging the return of Syrian competencies, and seeking to innovate modern technologies, according to al-Ahmad.
He clarified that the ministry is committed to strengthening local production and supporting the industrial sector to ensure sustainable development and create a competitive environment that contributes to improving the country’s economic situation.
The Ministry of Economy and Industry announced via its Telegram account on April 21, that it granted industrial licenses to 345 establishments in various sectors during the first quarter of this year, providing 4,242 job opportunities upon operation.
Absence of clearance instructions
Economic researcher Muhammad al-Saloum believes that the cessation of facilities is a result of prolonged accumulations over years, exacerbated by sanctions, the absence of supportive policies, delayed legislation, in addition to the loss of human competencies and lack of adequate funding.
Al-Saloum pointed out in a conversation with Enab Baladi that the delay in executive instructions for many economic decisions has led to the failure to benefit from them, such as the decision to exempt machinery and production lines from customs fees, which remains unimplemented due to the lack of clearance instructions from the finance authority.
He highlighted the absence of the necessary financial facilitation, especially in pharmaceutical and chemical industries, amidst the inability of local banks to finance production projects due to financial isolation and Syria’s exclusion from the SWIFT system.
Regarding the impact of foreign products, al-Saloum confirmed that customs distortions play a negative role, as duties are imposed on raw materials at rates exceeding those of imported products, weakening local producers’ ability to compete in the absence of fair protection.
He also did not overlook the impact of sanctions, which hindered the import of raw materials, equipment, and fuel, in addition to the difficulty of conducting financial transfers, complicating foreign trade and increasing operating costs.
Slow implementation
Identifying and analyzing challenges is part of any comprehensive development strategy aimed at strengthening the industrial sector and enables policymakers and investors to take practical steps to address them and improve performance.
Given that describing available investment and economic solutions for the Syrian industry is a pivotal part of any national development strategy, the parties concerned, according to Taysir Derklet, head of the Al-Arqoub Industrial Committee and vice president of the engineering sector committee at the Aleppo Chamber of Industry, need to:
Assess the industrial reality in Syria honestly and transparently. Identify areas of flaws and errors and examine opportunities for improvement to make appropriate decisions in the interest of industry and industrialists.He believes that the implementation of these procedures is slow today, and that slowness is very harmful; industrialists are thinking about moving towards trade and away from industry, which means new imports, leading to further financial draining and unfair competition against local goods.
Reforming the customs system
Economic researcher Muhammad al-Saloum proposed a set of emergency solutions for the industrial sector, including:
Reforming the customs system to ensure the protection of local production without closing off to the global market. Providing genuine operational and investment funding by establishing production banks or joint funding funds. Restoring confidence with international partners by concluding economic partnership agreements with neutral or friendly countries. Reintegrating Syria into the SWIFT system and activating international payment channels, as a critical necessity to liberate the production process. Establishing an industrial observatory that monitors market needs and export opportunities, and lays down clear plans for skilled personnel and technical labor. Ensuring transparency and competitiveness, preventing monopolies, and achieving partnership between public and private sectors based on public interest rather than personal interests.
Economic turmoil weakens industry in Syria Enab Baladi.
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