Impact of COVID-19 on Syrian refugees

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While the UNCHR counts nearly 670,000 registered Syrian refugees living in Jordan, the true number of Syrians who fled there is estimated to more than double that figure. This influx of refugees has placed continuous strain on Jordan’s economy and resources and meant that economic growth was already slow when the COVID-19 pandemic hit.

Jordan imposed one of the strictest COVID-19 lockdowns in the world, closing its borders and forcing all but essential businesses to close for weeks. The extended disruption to business activities caused unemployment to reach record highs in 2020 and the country posted its first recession in decades. As they were already vulnerable, the crisis has affected refugees most severely. For many, the struggle to survive is greater than ever.

Syrian-Refugees-Jordan-2021

35% of previously employed Syrians permanently lost their jobs

Unemployment among refugees was already high before the pandemic and many of them only had informal or irregular work. This made refugee workers much more likely to lose their jobs and 35% said that they were permanently laid of due to crisis, compared to 17% of Jordanians who had the same experience.

18 percentage point increase in poverty rate among Syrian refugees

Poverty was also already a serious problem among refugees and four out of five of them lived below the international poverty line of $5.5 per day. Yet, COVID-19 increased the poverty rate among Syrian refugees by another 18 percentage points. This means that poverty is now almost universal among them.

132,000 Syrian refugees outside camps are food insecure

The loss of income and job opportunities means that more Syrian refugees are also going hungry, with 21% of refugee households experiencing food insecurity, compared to 14% in 2018. This means that 132,000 individuals outside of refugee camps does not have reliable access to food.

59% of households limit food intake by adults for children to eat

As more and more refugees find themselves vulnerable to hunger, many households are being forced to resort to negative coping strategies. Child labour and early marriage has increase and in 59% of refugee households, adults are eating less to make sure children can be fed. In 2018, only 30% of refugee households were experiencing this level of need.

Sources: ILO, WFP, UNCHR

For Syrian refugees who fled to Jordan to relocate since war broke out in their country in 2011, formal employment is the first and foremost means of ensuring a decent livelihood and eventual economic integration. This has placed a huge strain on economic infrastructure, service delivery and employment avenues alike.

The Nomou Jordan Fund supports Syrian refugee and migrant-owned businesses in Jordan by providing them with a unique combination of access to finance, business development skills and market linkages, as well as Jordanian SMEs that employ and support the livelihoods of Syrian refugees.

Syrian refugee entrepreneur gets vital support to sustain manufacturing business

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When Basil Qassab fled from Syria to Jordan to ensure the safety of his family, he was left unemployed for nearly two years. It was 2011, and only the beginning of the crippling conflict that still drags on today. A decade later, nearly 670,000 registered Syrian refugees still reside in Jordan. Most still live under the poverty line, according to the UNCHR.

As Syrians were not yet granted work permits when Basil arrived in the country, he knew he had to become an entrepreneur if he were to survive. Ala’a Sabha, a Jordanian who was to become Basil’s business partner, first introduced him to the world of paper cup manufacturing. Ala’a and his brother were already running a successful printing business and recognised the opportunity to start manufacturing paper cups in Jordan.

“He had studied the market and I found the opportunity very promising. I decided to take on the challenge – especially since I didn’t have any other job opportunity at the time,” Basil says. 

The partners started producing paper cups with two machines in 2013. Today the business, Al Haramein, produces a wide range of paper cups for hot and cold beverages at a facility with 32 production machines. Last year, the Nomou Jordan Fund (NJF) provided Al Haramein with financing to expand even further. The business was growing rapidly, sales were increasing, and it started exporting to neighbouring Saudi Arabia. Then COVID-19 struck.  

Strict domestic lockdowns, the global economic slowdown, trade disruptions, and the suspension of international travel have placed severe pressure on Jordan’s economy and businesses like Al Haramein. According to the country’s Department of Statistics, GDP growth slowed to 1.3% in annual terms during the first quarter and then contracted by 3.6% in the second. The manufacturing sector also contracted by 5.3% in the second quarter.  

Lockdown measures forced Al Haramein to close its factory for two weeks and it could only operate at minimal production capacity for almost three months. Coupled with border closures which affected exports, these measures severely impacted Al Haramein’s sales. The business also struggled to collect outstanding payments from its clients.

“The pandemic affected us in many ways including reduced mobility of employees and production halts. Sales and exports declined, while expenses associated with shipping and maintenance increased,” Basil explains. 

The NJF granted Al Haramein a 3-month concession on its loan repayments to overcome the gap in its cashflow.

“This concession helped us balance our cash inflows and outflows more effectively in these difficult market conditions and to return to near-normal cash flow management in a shorter period,” Basil says.   

GroFin Jordan’s advice to Al Haramein, in combination with the payment concession, helped the partners to better manage their cashflow. The business could maintain sufficient inventory levels without falling behind on its commitments to others. GroFin advised Al Haramein to switch to online transactions wherever possible online and to improve its ESG practices and health and safety measures amidst the pandemic.  

Despite their challenges, it was important for the entrepreneurs to maintain their 75 employees. Ahmad Hamdan has been working as warehouse keeper at Al Haramein for two years. He supports seven people including his young children, mother, and sisters and says many people in his community have lost their jobs.

“I am very thankful that I was able to continue working and receive my salary especially as I have many commitments and I am the sole provider for my family.” 

Basil says the emotional support GroFin provided them was also invaluable.“I was overwhelmed with feelings of anxiety and stress. GroFin followed up with us regularly to make sure we are addressing all key issues. We felt we had a real partner and not just a financier. We felt that we were not alone in our fight against the tough economic conditions.”