Syria economic meltdown presents new challenge for Assad

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FILE - In this January 13, 2010 file photo, Syrian employees stack packets of Syrian currency in the Central Syrian Bank in, Damascus, Syria. In Syria nowadays, there is an impending fear that all doors are closing. After nearly a decade of war, the country is crumbling under the weight of years-long western sanctions, government corruption and infighting, a pandemic and an economic downslide made worse by the financial crisis in Lebanon, Syria's main link with the outside world. (AP Photo/Hussein Malla, File)

BEIRUT – In scenes not witnessed for years in government-controlled parts of Syria, dozens of men and women marched through the streets this week, protesting a sharp increase in prices and collapse of the currency, some even calling for the downfall of President Bashar Assad and his ruling Baath party.

“He who starves his people is a traitor,” some of the protesters chanted at the protest in the southern city of Sweida.

In Syria nowadays, there is an impending fear that all doors are closing. After nearly a decade of war, the country is crumbling under the weight of years-long Western sanctions, government corruption and infighting, a pandemic and an economic downslide made worse by the financial crisis in Lebanon, Syria’s main link with the outside world.

Syria faces near complete isolation as the toughest U.S. sanctions yet start to come into effect next week. While Assad may have won the military war against his opponents with the help of allies Russia and Iran, he now faces an even bigger challenge of governing while more than 80% of his people live in poverty.

In government-held areas, prices go up several times a day, forcing many shops to close, unable to keep up with the chaos. This week the Syrian currency dropped to a record 3,500 pounds to the dollar on the black market — compared to 700 at the beginning of the year. Some staples such as sugar, rice and medicine are becoming hard to find.

“The Syrian economy has spiraled out of control and the regime cannot control the Syrian pound anymore,” said Osama Kadi, a Canada-based Syrian economic adviser.

The pain is likely to grow under the new U.S. sanctions, which Washington says aim to punish Assad and his top lieutenants for crimes committed during the country’s conflict.

Effectively, the sanctions prevent anyone around the world from doing business with Syrian officials or state institutions or participate in the war-ravaged country’s reconstruction. They also target anyone involved in smuggling to Syria, mostly from Iraq and Lebanon.