Report: Syrian economy has shrunk by 20% this year

Syrian finance ministry is confident GDP figures will be positive Syria's economy has shrunk by 20 percent in 2012, according to the US-based Institute for International Finance. The decline is down to several key factors, with IIF stressing upon civil war as being the main component. The organisation adds that Syria's foreign reserves could be spent by the end of next year, because President Bashar al-Assad's government has spent billions of dollars in reserve on wages and fuel subsidies.
Since March 2011, the rate of inflation has risen to 40 percent, and the external pressure on President Assad to step down has increased.
Garbis Iradian, deputy director of the IIF's Africa and Middle East department said, "The sanctions by the Arab League introduced in late 2011 and the September 2011 US and EU sanctions have meant more economic hardships for 2012 and 2013."
The war in Syria has affected neighbouring countries, with refugees fleeing to Turkey, Lebanon, Jordan and Iraq. Figures show a dip in recovery of the Lebanese economy, with forecasters predicting a 0.6 percent growth in 2012, compared to 1.8 percent in 2011.
"The deepening conflict in Syria continues to pose a threat to Lebanon's political order and economic stability," Iradian added.
The Syrian government is yet to release economic forecasts for 2012, but the finance ministry is confident that GDP figures will be positive.