Daniel W. Drezner

The new equation for overthrowing resource-rich dictators

The Washington Post‘s Liz Sly has been doing some excellent reporting on the ground in Syria, and her latest report suggests that the latest batch of sanctions are starting to hurt Syria badly:  The dramatic decision by Arab states to turn against President Bashar al-Assad could further damage Syria’s economy at a time when it ...

The Washington Post‘s Liz Sly has been doing some excellent reporting on the ground in Syria, and her latest report suggests that the latest batch of sanctions are starting to hurt Syria badly: 

The dramatic decision by Arab states to turn against President Bashar al-Assad could further damage Syria’s economy at a time when it is already unraveling, posing perhaps a graver challenge to Assad’s survival than the country’s nearly-eight-month-old popular uprising, analysts say….

The extent of the damage is difficult to measure, and Syrian government officials say they don’t have indicators. But they do not play down the gravity of the situation.

Syrian Economy Minister Mohammad Nidal al-Shaar said at a conference last month that the economy is in a “state of emergency,” according to comments quoted by the Damascus-based Syria Report. In a recent interview in Damascus, Adib Mayalah, governor of the Central Bank of Syria, described the situation as “very serious” and ticked off the problems the economy is facing.

“Unemployment is rising, imports are falling, and government income is reduced,” he said. “In areas where there are protests, there is no economic activity — so people aren’t paying tax. Because they aren’t working, they are not repaying their loans — so the banks are in difficulty. And all this is weakening the economy.”

Merchants interviewed recently on the streets of Damascus report a 40 to 50 percent fall in business as consumers hoard cash and cease spending on all but the most essential items. Tourism has skidded to a halt, representing a loss of $2 billion a month to an economy worth $59 billion last year, Mayalah said.

“The whole system has been shrinking — and very fast,” said Rateb Shallah, a prominent Damascus businessman. “The sanctions are squeezing us, and it is definitely affecting us quite a bit.

To what extent the downturn is due to the sanctions isn’t clear, however.

Until now, only the United States, the European Union, Canada and Japan have imposed sanctions on Syria, with relatively limited measures mostly targeting individuals and financial services. The most serious measure, a European embargo on oil purchases imposed in August, goes into effect only on Tuesday because Italy sought to ensure that its existing contracts were honored.

But the experience of the oil embargo illustrates the broader crisis of confidence confronting Syria. European nations, which account for a vast majority of Syrian oil exports, immediately halted their purchases, even though they were not required to do so for three more months. And oil pumped since then has gone unsold, despite Syria’s boasts that it would easily find other customers. Syria has curtailed its oil production by more than 25 percent, Mayalah said (emphasis added).

The EU sanctions are clearly having an effect, and they were just ratcheted up a notch.  What’s particularly interesting, according to CNN’s Ivan Watson, is that Turkey might be weighing in:

Turkey threatened to cut off supplies of electricity to its neighbor Syria Tuesday, as the Damascus regime found itself under growing pressure from Arab, Turkish, European and North American governments for its ongoing lethal crackdown on pro-democracy demonstrators.

"We are supplying them (Syria) with electricity at the moment. If they stay on this course, we may be forced to re-examine all of these decisions," Turkish Energy Minister Taner Yildiz said Tuesday, according to Turkey’s semi-official Anatolian Agency….

Observers warn the protest movement in Syria, which struggled peacefully for months, is growing increasingly "weaponized" as more and more Syrian soldiers desert from the armed forces and join the opposition.

There’s just a whiff of the Ivory Coast in how things are playing out right now.  Effective sanctions + regional cooperation + weaponization of the opposition = eventual dictator downfall.  It’s not as neat and tidy as that equation, of course, but you get my drift. 

There’s an interesting irony here.  Historically, the leaders of resource-rich economies have had greater leeway make mischief and resist waves of democratization.  In the current climate, it would seem that these are the very economies most vulnerable to active economic pressure. 

Obviously I’m not expecting an oil embrago on Iran anytime soon — there are costs to sanctioning a major oil exporter.  Still,  these events are no doubt disturbing in Tehran and elsewhere. 

What do you think?  Is Assad doomed? 

 Twitter: @dandrezner

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