Wednesday’s sanctions imposed by the US Treasury and the US State Department seek to deprive Assad government of funds.
Syrian President Bashar al-Assad is going nowhere. He withstood the military threat posed by a decade-long war and even as the country faced its worst food and economic crisis over the last few months he has managed to cling to power.
Some in the West had hoped the economic pressure, exacerbated by sanctions, would force his own Alawite community to overthrow him, but the discontent has not culminated in a second uprising.
The lives of Syrians in regime-controlled territory, however, have worsened immeasurably. Queues outside bakeries and fuel stations have become the new normal while a shortage of electricity has adversely affected local businesses and exacerbated unemployment.
Ahmad and his brother take turns to queue outside a bakery in Damascus to buy subsidised bread.
“Today was my turn and, I kid you not, I stood in the line for six hours, again,” Ahmad said. “Electricity, we have completely forgotten about it. Our uncle who is a tailor has shut down his shop because he cannot function with this three hours on, five hours off electricity supply.”
The Syrian economy is in tatters. Syrians are grappling with hyperinflation, food shortages and joblessness with no end in sight.
Last year, as Lebanon went bankrupt, many Syrians who put their money in Lebanon’s banks lost their savings, too. Their misery compounded as the price of bread shot up, the United States imposed sectoral sanctions, and Russia cut down on the export of wheat to maintain domestic supplies during the coronavirus pandemic.
Scorched earth tactics
Syrians like Ahmad attribute the lion’s share of blame to President al-Assad’s ruthless bombing of the country, including crucial infrastructure such as farm machinery and power plants and, as far as agriculture goes, his literal scorched earth tactics in opposition areas. However, they also hold Russia and the US responsible for aggravating the crisis.
Russia supported the Syrian government in the military conflict while the US condemned al-Assad. But the policies of both have added to peoples’ suffering.
Until 2008, Syria exported wheat to neighbouring nations. Grain sufficiency was a cornerstone of Hafez al-Assad’s regime and worked on the premise that if the population was well-fed it would remain pliant. Syria grew four million tons (3.6 million tonnes) of wheat in a good year.
But a drought in 2008 and a decade-long civil war turned Syria into a wheat importer. As production fell by half, the government turned to Russia – an ally and the world’s biggest grain exporter. Russia offered 100,000 tons in aid, but not more. The rest would have to be bought or exchanged for something in return from Syria.
Bassam Barabandi, a former Syrian diplomat who currently lives in the US in exile, said the Syrian government had no more money so it instead offered the country’s resources to Russia.
“Russia opened a credit line to the regime to buy grain with a sovereign guarantee and in return gave access to oil [reserves] and phosphate mines,” said Barabandi.
According to the Syria Report, a regular study of the country’s economy, Syria needs to import 1.1 million tons (one million tonnes) of wheat a year to meet its requirements, and most of it used to come from Russia. But in 2020, Russia reduced its supplies. It is not yet clear how much it exported but reportedly Syria’s overall wheat imports fell by half.
This year rainfall has been sufficient and yet the government will still need to import more to feed all its people. Russia could come forward but so far it has not.
An additional reason for the wheat shortage is that Syria’s northeast, the breadbasket of the country that produced 60 percent of the total requirement, is under the control of Washington’s Kurdish allies.
Even though US sanctions theoretically allowed for the grain trade to continue, in practice the exemptions do not always work as advertised.
Aron Lund, a researcher at the Swedish Defence Research Agency (FOI), said while the US sanctions allow for certain types of trade, such as food and humanitarian aid, over-compliance often deters banks, insurers and shipping companies.
“Syria is a small market and it is simply not worth risking a US government lawsuit,” said Lund.
Moreover, the US’s sanctions on the trade of oil affect other essential sectors.
“By restricting Syria’s fuel supply through oil trade sanctions and by backing Kurdish control over the eastern oil fields, the United States hurts the Syrian economy as a whole,” Lund said. “Tanks need gasoline to wage war, but farmers also need it to run their tractors, factories need the electricity, and civilians on all sides of the war depend on cars, buses and trucks being able to deliver people and goods.”
Prices up 30 percent
Joshua Landis is a US-based Syria expert who heads the Center for Middle East Studies at Oklahoma University and is married to a Syrian woman. He said it was naive to think that sanctions will merely affect al-Assad and his cronies.
“I just talked to my brother-in-law,” he said. “His small plastics factory cannot run most of the time because electricity is cut for five-hour periods of time. He has difficulty getting fuel for his generator, which raises the price well above electricity costs. Due to inflation, prices change every day so that he cannot be sure that contracts he signs today will make money tomorrow.”
“Foreign NGOs estimate that prices of most daily products have gone up 30 percent due to sanctions,” Landis added.
Opinion on the effect of sanctions on the Syrian people is deeply divided, however.
Bente Scheller, head of the Middle East and North Africa division at Heinrich Böll Stiftung, said while sanctions against Syria’s central bank might prevent international companies from trading with Syria, it could ask its allies for help.
“Given that the regime is not isolated but has powerful backers – mainly Russia – it could turn to them for goods it finds itself unable to obtain,” she told Al Jazeera. “If it can obtain military supplies from Russia it is not feasible that sanctions would deter Russia from delivering civilian items.”
US sanctions are intended to obstruct Syria’s reconstruction and force al-Assad to usher in meaningful political reforms. Europe, too, has banned aid for Syria’s reconstruction as it sees reconstruction funds as the only leverage it has left over the regime to change its behaviour. But its stance is challenged by critics, who say reconstruction is a matter of the welfare of citizens, while the West has not achieved its stated objective by refusing to allow it.
The International Crisis Group has long suggested an “incremental incentives-based approach” – a progressive lifting of sanctions and a stage-by-stage disbursement of reconstruction funds in exchange for political reforms.
It may have a point. Authoritarians, after all, have never relinquished power for the wellbeing of their people.
As US President-elect Joe Biden takes charge in Washington he has a difficult and unpleasant choice to make. If he eases sanctions and allows for gradual reconstruction, Syria will revive economically but a part of those funds would most certainly be siphoned off by the government.
“How to balance civilian suffering against pressure on the regime is a political choice,” concluded Lund. “But pretending like you can wreck the regime’s economic base without simultaneously hurting ordinary Syrians – that’s dumb and dishonest.”