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Ghosts of economic crisis as Syrians weather this regime

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The Occupy movements that swept across the United States and the world are concerned with the plight of “the 99 per cent”. As someone who was fortunate to grow up in Syria as part of the 1 per cent, let me tell you, in the winter, we were cold.

In parts of Syria now, society is sliding towards worsening violence with news dominated by the shelling of Homs on Saturday, and the failure of the UN Security Council to pass a resolution condemning the regime that night. Beneath the headline news, however, there is another difficult reality that has echoes from the past.

Before the recent shelling, videos showed desperate people in Homs lined up, waiting and hoping to fill coloured plastic jugs with a tiny amount of mazout, or heating fuel, recalling memories of a grim Syria in the 1980s when Hafez Al Assad clamped down on the economy and suffocated society with strict rationing. Imports were banned as Syria was declared “self-sufficient”. School field trips were routed to “pass by” villages to buy black-market items such as toilet paper, boxes of tissues and canisters of powdered milk smuggled in from Lebanon, Turkey or Jordan.

The bread lines at government-subsidised bakeries were endless. “Supermarkets” were small stores with sad rows of empty shelves. Bananas were a luxury for anyone. We wore our coats all day at school and warmed our hands during recess over a tiny stovepipe heater. People heated their homes (and still do) one room, one corner, at a time.

While the Syrian revolution nears its 11th month, Bashar Al Assad is determined to prove that he, contrary to the people, loved the 1980s. As he mimics his father’s trademark indiscriminate murder and torture, economic hardships have also become a blast from an unwelcome past. The country suffers from widespread shortages of mazout and other fuel. Electricity is cut off for hours every day. Prices of food are skyrocketing as the Syrian currency plummets.

During this uprising, we have lost thousands of people; in the last few days, hundreds more. The economic plight of Syrians is no surprise, because a president who has no problem shooting protesters and torturing dissidents would think nothing of freezing or starving the rest. But the weakened economy is what, many speculate, may be the final straw to break the ruthless regime’s back.

According to recent interviews in the Financial Times and Bloom-berg with the central bank governor, Adib Mayaleh, the regime intends to float the currency to stabilise the Syrian pound, which has lost almost 50 per cent of its value. Although Syria faces a real economic crisis, Mr Mayaleh claims the devaluation of the currency “is imaginary and a result of speculation”. In other words, it’s another conspiracy.

Mr Al Assad described the lean 1980s in his last speech: “We say to the generation which does not remember that stage ... do not allow the fear to control your heart as a result of the media war which is targeting you. Syria has undergone much more difficult conditions during which even the security situation was much more difficult.”

Those conditions were navigated by “self-sufficiency”, another throwback term for the regime. As Mr Mayaleh explained: “What we need to do today is increase the efficiency of this self-sufficiency, so it compensates for what we lost.” Using a Marie Antoinette tone that that he is fond of, he declared: “We can live without salmon ... I think we will have to give up the cake to eat brown bread.” The president was quick to reassure: “And we have olives.”


Federal Reserve Bank

WALL STREET JOURNAL

U.S. Bureau of Economic Analysis