Syria's interim administration plans to increase public sector wages by 400%.

 Syria's interim administration plans to increase public sector wages by 400%.

In Damascus, Syria, on December 16, 2024, following the overthrow of Bashar al-Assad, people are seated close to bundles of Syrian currency notes at the Syrian central bank. (Image: Ammar Awad/REUTERS)

DAMASCUS: Syria's finance minister announced on Sunday, January 5, that the government would increase the pay of many public sector workers by 400 percent the next month, following the completion of a ministry administrative reform aimed at increasing accountability and efficiency. 

Estimated to cost 1.65 trillion Syrian pounds, or roughly US$127 million at current exchange rates, the increase will be funded by a combination of new investments, regional help, and efforts to unfreeze Syrian assets held outside.

"(This is) the first step towards an emergency solution to the economic reality in the country," Syria's caretaker government's finance minister Mohammed Abazeed told Reuters, adding that public sector employees' salaries for this month would be disbursed this week.

The new caretaker administration in Syria is implementing these steps as part of a larger plan to stabilize the economy after 13 years of violence and sanctions. 

Along with most Syrian', public sector workers under the overthrown administration of President Bashar al-Assad made about $25 per month, which put them below the poverty threshold, according to Abazeed. 

Following a thorough review of up to 1.3 million registered public sector workers in order to eliminate fraudulent workers off the payroll, the increase would impact individuals who possess the requisite training, education, and expertise for reconstruction.

As a result of the conflict, Syria's state treasury is experiencing liquidity issues. The majority of the money at the central bank is in the form of Syrian currency, which has significantly depreciated. Nonetheless, the minister stated that Arab and regional nations pledged support to the incoming administration. 

He added that the central bank now has enough money to cover the upcoming months. "The launch of investments in the country in the near future will also benefit the state treasury and allow us to finance this salary increase," he said.

The government anticipates recovering up to $400 million in Syrian assets that have been frozen overseas, which might help pay for the initial costs.

In order to achieve tax justice for all taxpayers, Syria's interim administration is also considering removing as many penalties and interest from taxpayers as possible. A first draft of the proposed tax system revamp is anticipated in four months. 

"By the end of this year, we expect having a well-designed tax system that takes the interests of all taxpayers into account," he stated.