The Syrian government has announced that it intends to phase out its massive fuel subsidies over the next five years, according to an interview conducted by the Reuters news agency with Abdallah al-Dardari, the Deputy Prime Minister for economic affairs.

Mr. Al-Dardari estimates that the total sum for subsidies in Syria's 2008 budget would reach USD$7 billion. For comparison, Syria's GDP is estimated to be USD$24.26 billion.

The government's fuel subsidy policy has led to widespread smuggling to countries in the region where less subsidized gas is significantly more expensive. This has put added pressure on the Syrian state budget; economists have estimated that the smuggling costs the Syrian government USD$800 million annually.
 
In order to decrease the impact that a rise in fuel prices will have, Syrian Prime Minister Mohammas Naji Ottri has stated that the government will increase direct subsidies to families to help them cope with the increased fuel costs, according to local news reports.