Salman explained that the decree will include all public sector employees and employees in the joint and military sectors. He added, "This salary increase will have a positive impact on Syrian citizens because it will improve their income and recover a part of their weak situation due to increased prices.”

Salman, who spoke to Al-Monitor in a phone interview on June 25, was referring to the Syrian armed opposition and the foreign fighters whom the Syrian regime refers to as “terrorist groups” or “criminal gangs.”

Syrian Deputy Minister of Finance Hayyan Salman said in an exclusive interview with Al-Monitor that the recent salary increase is a “national decision that came at a time when some expected the collapse of the Syrian economy. But today Syria is starting to win economically — after its political [Geneva II conference] and military [Qusair battle] victory — despite the harsh conditions caused by acts of criminal gangs, such as attacking the infrastructure and destructing economic facilities as well as cutting off roads."

Syria is facing an economic war today, along with the political and military war that has already victimized the Syrian people. Syrian Prime Minister Wa el al-Halki said on June 19 that his government confronts a “ media and economic war ” that attemps to weaken the country's currency.

According to SANA, the Syrian news agency, the president decree stipulated that salaries would be raised monthly by 40% for the first 10,000 Syrian pounds ($50), 20% for the second 10,000 Syrian pounds and 10% for the third 10,000 Syrian pounds. This means that a salary of 30,000 Syrian pounds ($150) will now be 37,000 Syrian pounds ($185).

The decree increases the minimum wage of the private, cooperative and joint sector to 13,670 pounds ($70) per month.

The deputy minister said that the government asserted — along with the salary raise decree — that it will not increase prices of goods and services. He also said that there are crisis traders who may exploit the situation to manipulate prices. He warned that there is a need to increase surveillance of these prices and promote the national sentiment of the traders, otherwise the decree will lose its real meaning.

The Syrians have recently faced a rapid weakening of the Syrian pound — also known as the Syrian lira — that fell about 30% in value against the US dollar on June 17; it had weakened from 170 to 220 Syrian pounds per US dollar in three days.

Before the "crisis" started on March 15, 2011, the Syrian pound had been trading at about 47 per US dollar.

Some analysts say that this currency collapse is the result of the US declaration that it will arm some opposition factions, reflecting chaotic selling by Syrians who fear that the Syrian pound could weaken further and so rush to convert to euros or US dollars.

Salman commented on the currency status, saying, "We have to tighten the procedures to save the Syrian pound and avoid the results of economic sanctions.” He suggested, "There must be more control on cash reserve management by the central bank, not sell it at auction, to control the pumping of cash reserves in the markets and finance the necessary imports only.”

Western and Arab sanctions have been the most influential factors that have collapsed Syria’s main foreign currency-earning from industries of oil, trade and tourism.

Former Lebanese Minister of Finance George Corm told Al-Monitor on June 22 that the sanctions imposed on Syria had affected the Syrian people and not the regime, because of direct consequences that reflected in the deterioration of the Syrian currency and price increases.

Salman believes that the government measures to contain the economic sanctions should be through the activation of internal factors, increase of work production, increase of the productivity of labor and activation of the gross domestic product. He added, "The Syrian government should improve economic relations with its allies such as Iran, Russia and China by creating economic zones and importing the goods that Syria needs from those markets, in addition to activating the credit line provided by Iran.”

Syrian Central Bank Gov. Adib Mayalah announced on June 18 that Syria would tap into a $1 billion credit line provided by Iran to help stabilize the Syrian pound. He said that the Central Bank had responded to the Syrian banks’ demands for foreign currency by injecting 100 million euros in cash.

This step has stopped the Syrian pound’s decline and strengthened it to about 180 Syrian pounds per US dollar by June 22, while the official rate is about 100 Syrian pounds per US dollar.

Latakia’s MP Ammar al-Assad told Al-Monitor in a phone interview on June 21 that the deterioration is caused by speculators’ manipulation of the exchange rates in the black market. He said that this is mainly due to traders' greed, and partly because of the ignorance of some people who hurry to buy foreign currency to ensure the value of their savings.

Salman pointed out that the salary raise would help to increase the final consumption expenditure that in turn would lead to activating the economic output. He pointed out, "This decision will confirm to the outside world that Syria is determined to defeat the plot and formulate an economic program, maybe the most distinct in the whole world."

The salary increase — along with the deterioration of the currency — may lead to enormous inflation problems, with inflation today already at 50%.

Furthermore, half of the Syrian people — about 12 million out of 22 million — entered the cycle of poverty in 2012, including 3.6 million Syrians who live in extreme poverty as a result of price increases of goods and services and decline of income sources during the continued civil war.

Thus, one wonders how do Syrians manage to live, earning an average salary of between 10,000 and 20,000 Syrian pounds?

Assad explained to Al-Monitor that the Syrian government has not stopped its subsidies on most goods, especially food, fuel, gas and electricity. He added that it also supported the agricultural sector and provided its products with competitive prices.

When asked about the increase of gas prices and some essential goods as well as other products, Assad responded that a cylinder of butane gas for cooking is sold for 1,000 Syrian pounds ($5), while it costs the government 1,600 Syrian pounds ($8). He pointed out that the prices have increased due to the sanctions, siege and security situation, as well as transport difficulties in some areas and the destruction of many factories.

Asked whether he is content with the government efforts to confront the sanctions as well as the currency weakening, Assad said, “In this war situation, we can not judge the government’s performance as its main concern is to provide its people with security and food.” He added, “Despite this war, the price of bread is still 15 Syrian pounds [$0.07].” The price of bread in neighboring Lebanon is $1.

Marah Mashi, a Syrian journalist based in Damascus, told Al-Monitor on June 22 that Syrian citizens receive monthly government coupons that allow them to buy from public cooperatives the essential goods at prices subsidized by the government. She added, "This explains how the Syrian lower and middle classes can survive amid these crazy price increases."

Mashi pointed out that the dollar has become central to some daily transactions.

Haytham Mouzahem is a Lebanese analyst specializing in Middle Eastern and Islamic affairs. On Twitter: @haytham66