Has Assad’s Social Base Narrowed or Expanded?

[Landis Analysis] The following EIU economic overview (copied below) is good. One nit to pick.

Since the consolidation of Bashar al-Assad’s authority at the Baath Party Congress of 2005, it has become common for analysts to repeat the following wisdom: “[Assad] has entrenched his control, albeit at the cost of narrowing his power base.”

Here are a few examples:

1. “In the aftermath of the latest Baath Party Conference, the Assad family consolidated its grip on power by narrowing the base to its inner-most circles.”

2. Zisser in 2006: “the question of how long Bashar can survive remains valid given Syria’s internal discord and growing international isolation. Bashar has wrecked many of his father’s achievements, if not his life’s work. Syria is no longer the stable and strong state it was when Hafez al-Assad died. Threats to the regime’s domestic stability have increased…. Bashar must realize that delegation of power to family members is not enough to ensure security. Rumors of tension within the ruling family are rife as are hints that Asaf Shawkat and Mahir both have ambitions to replace Bashar. … The Syrian elite simply does not fear Bashar the way they feared his father…

3. Kirsten Maas and Heiko Wimmen of the Heinrich Böll Foundation: “It appears clear, however, that despite initial rhetoric hinting at reform, the power base of the regime has narrowed since Bashar’s succession to power, and is more and more restricted to the immediate Assad family and its entourage.”

I wish someone would explain how Assad’s base has narrowed? Is it because the old guard was jettisoned? i.e. Khaddam, Kanaan, Shihabi… These people didn’t support Bashar. They were trying to take control for themselves. Khaddam thought he should be president – not a very dependable social base! More important, however, Khaddam had no social base independent of his state position as V.P. If one wants to argue that with the defection of Khaddam, Bashar has lost Sunni support, I would have to chuckle. Today Sharaa is V.P. He is a Sunni and has as large a social base as did Khaddam.

Bashar jailed the 12 leading civil society opposition members. That is true, but they were certainly not part of his social base. On the contrary, they were calling for democracy and an end to the present leadership. We cannot count them as previous members of his social base.

Bashar has placed his brother-in-law in a principal internal security position to replace Bahjat Suleiman. OK, but is this narrowing his social base? No. The Mukhabarat leaders have always gone to candidates close to the president’s family. Rifaat al-Assad – Hafiz’s brother – was the main security guy for Hafiz for 14 years. Bashar is just replicating a working arrangement that has been in place in Syria for 40 years. This is not narrowing his base. Did Bahjat Suleiman, Bashar’s first security chief offer a broader social base than Asef Shawkat? No. He was touted to be Bashar’s “God father,” who helped him transition into the presidency – super loyal to father and son. He had a social base of Bashar.

Bashar has allowed his cousin, Rami Makhlouf to become Mr. 10% in the economy thereby supposedly allienating the Sunni business class which objects to the nepotism and, hence, have left Bashar’s social base. If this is the argument for a “narrower social base,” it doesn’t pass muster. The economy has been expanding at a steady clip since Bashar 2000, undergoing liberal reforms and seeing new foreign investment. The vast majority of this investment has gone into Sunni pockets, despite the emergence of Mr. Makhlouf as the central figure tying it all together and bringing it under the patronage umbrella of the first family. Sunni merchants are happy to have a sympathetic and capitalist friendly technocrat like Dardari as economy Deputy Prime Minister. They are happier now than they were under Hafiz, expanding the leadership’s social base. 

The “loyalty” and expanded social base this offers Bashar was on view for all to see during the campaign parties or ‘huflat” of the summer of 2007, when Bashar renewed his presidency. The Sunni magnates of Damascus turned out to fete the authority and leadership of the president. By consolidating power, Bashar broadened his social base. That is the essential verity of authoritarian states. The elites, realizing that there is no alternative to the present state, put aside their hesitancies and luke warmth in order to make money, carve out a future for their families, and embrace the central authority that they must make peace with. That is what has happened in Syria. Consolidation of power has meant the broadening of the president’s social base not its narrowing. The Iraq example has broadened the government’s social base immeasurably and helped the Sunni elites cast aside any Bushian dreams of democracy and freedom agenda’s for the time being.

I think one has to argue that Bashar al-Assad has broadened his social base over the last 3 years rather than narrow it.  

[end of commentary]

Syria: Economic Overviews, 2008-10-14,
COUNTRY VIEW: FROM THE ECONOMIST INTELLIGENCE UNIT, OUTLOOK FOR 2009-10

* The president, Bashar al-Assad, is expected to remain in power in 2009-10 and there is little threat to his rule. However, tensions within the ruling elite, exacerbated by external pressures, could prompt more political assassinations.

* Mr Assad will continue to try to reduce Syria’s political isolation, although any significant and open interference in Lebanese politics would alienate new interlocutors such as France’s president, Nicolas
Sarkozy.

* There is unlikely to be progress on negotiations with Israel, following the change of Israeli leadership and widespread public and parliamentary opposition in Israel to returning the occupied Golan Heights to Syria.

* The main policy challenge will be to offset the impact of declining oil production by increasing investment and encouraging entrepreneurship, particularly in sectors that will boost export earnings.

* Inflation will decline from its 2008 peak, but will remain high at 11.2% in 2009 and 10.1% in 2010. There is an upside risk to these forecasts, associated with how secondary inflationary effects work through the economy.

* The current account is forecast to slip into deficit in 2009, to the tune of around US$500m (0.9% of GDP); in 2010 the deficit will narrow slightly as export earnings increase.

DOMESTIC POLITICS: Mr Assad’s control of the country is supported by key elements in the security services and by the ruling Baath party, and his position remains secure, although the regime will face significant challenges in 2009-10. Since assuming power following the death of his father, Hafez al-Assad, in 2000, Mr Assad has continued the repression of local opposition groups and activists, and has appointed close allies to  key posts. This has entrenched his control, albeit at the cost of narrowing his power base. The core of the elite is largely drawn from Mr Assad’s minority Alawi sect, and is acutely conscious that to move against him would risk endangering the Alawi hold on power. However, there are tensions within the elite, which sometime result in political assassinations, more of which are expected over the outlook period as result of external pressures, particularly the UN investigation into the killing of Rafiq al-Hariri, a former Lebanese prime minister. (The assassination in August 2008 of Mohammed Suleiman may have been related to his role as an interlocutor with the International Atomic Energy Agency, the UN nuclear watchdog, in its investigation of Syria’s alleged nuclear programme.)

INTERNATIONAL RELATIONS: Since mid-2008 Syria’s international isolation has begun to ease, largely because of its support for the May 2008 Doha agreement between the opposing factions in Lebanon and its agreement to normalise diplomatic relations with Lebanon, but also because of its engagement in indirect talks with Israel, which are being brokered by Turkey. The early fruits of these developments have included financial assistance from Gulf Arab states and a visit to Damascus, the Syrian capital, by the French president, Nicolas Sarkozy. However, Syria’s diplomatic links with the region’s heavyweights, Egypt and Saudi Arabia, remain strained and there is no obvious catalyst for improvement over the outlook period. A rapprochement with the US would also be difficult, although the most likely next president, Barack Obama, has a stated policy of dialogue with enemy states, including Syria. However, Syria still considers Lebanon to be within its sphere of influence and Mr Assad is therefore likely to get entangled in fresh controversy in the run-up to the 2009 Lebanese parliamentary election and after it, if the anti-Syrian “March 14th” coalition emerges victorious. A further threat is the Hariri investigation, and the UN prosecutor is expected to release a list of suspects, which may include some senior Syrian officials, in early 2009.

POLICY TRENDS: Syria has been gradually reforming its centrally planned economy, a process that has been led by the deputy prime minister for economic affairs, Abdullah al-Dardari, and is expected to continue in
2009-10. The overriding policy challenge will be to offset the impact of the recent (albeit temporarily checked) decline in oil production by making established businesses more dynamic and encouraging investment and entrepreneurship, particularly in sectors that can boost export earnings.

As credit is likely to be difficult to secure in the context of the ongoing global financial crisis, Syria’s spending will be constrained by its revenue, which will entail fiscal prudence. The reduction in fuel subsidies in May 2008 was a significant step, but the simultaneous increase in public-sector salaries largely offset the fiscal benefits and will stoke secondary inflation. Although the introduction of a value-added tax (VAT) has been approved in principle, and would diversify government revenue, its implementation may be put off until late 2009 or 2010.

INTERNATIONAL ASSUMPTIONS: World GDP growth (at purchasing power parity exchange rates) is expected to slow to 3.2% in 2009, owing largely to the impact of the global credit crunch on the US and other OECD economies, before recovering to 4% in 2010. As oil demand in emerging markets partly offsets the slowdown in the OECD, oil prices will remain high, averaging US$96/barrel over the outlook period, although this is well below the July 2008 peak of US$147/b.

ECONOMIC GROWTH: Real GDP growth will accelerate to 5.4% in 2009, driven largely by a partial recovery in agricultural exports (following this year’s drought and poor harvest) and a pick-up in investment, both foreign and domestic, albeit from a low base. Growth will slow but remain solid in 2010, at 4.8%, still above the estimated average of 4% in 2007-08. Growth in private consumption is likely to weaken in 2009-10, because of a drop in disposable incomes (owing to the cuts in fuel subsidies and to inflation) and a decline in the contribution from Iraqi refugees as they run down their savings, find it more difficult to enter the country and return home in growing numbers.

INFLATION: Consumer price inflation, which the Economist Intelligence Unit estimates will have averaged 14.4% in 2008, is expected to decline but remain high in 2009-10. It will take some time for the secondary effects of the rise in fuel prices (owing both to lower subsidies and higher international fuel prices) and the 25% increase in government salaries and pensions to work their way through the economy. In 2009 a decline in oil prices and an easing of non-oil commodity prices will help to bring down inflation, to a forecast 11.2%. Any significant return of Iraqi nationals to their homeland could lower it even further by reducing demand pressures, although that is more likely to happen in 2010, when we forecast inflation will ease to 10.1%.

EXCHANGE RATES: The Syrian pound has been pegged to a basket of currencies based on the IMF’s special drawing rights (SDR) since October 2007, resulting in a marked appreciation against the US dollar. Although the new regime is less rigid than the previous peg to the dollar, the authorities remain unlikely to let the pound float freely, placing a high priority on exchange-rate stability. The dominant position of the state-owned banks and the Central Bank of Syria’s control over foreign-currency transactions (even as some laws are relaxed) mean that the regime is well placed do this. The pound has declined slightly from its May 2008 peak of SP45.8:US$1, and we do not expect any substantive change over the outlook period, with the pound weakening slightly as the dollar recovers against the SDR. As a result, the exchange rate is forecast to average SP47.5:US$1 in 2009-10.

EXTERNAL SECTOR: We expect Syria’s non-oil export earnings to rise steadily over the outlook period, but as oil export revenue will continue to account for over one-third of the total, the headline exports figure will fluctuate in line with oil prices. We forecast that exports will grow by 1.2% in 2009–as the rise in non-oil export earnings offsets the decline in oil export revenue–and by 10.2% in 2010 as oil prices strengthen. We forecast reasonably good harvests over the outlook period, but if drought persists it will have a significant impact on wheat and other food exports. Oil production is increasing at a number of small fields so that, despite the ongoing decline in the larger mature fields, overall production will increase slightly in 2009 to an average of 383,000 barrels/day (b/d), declining to 375,000 b/d in 2010. In any case, the net impact of oil on the trade account is relatively neutral because Syria is now importing almost the same volume of refined products as it exports in crude oil. However, non-oil exports are continuing to benefit from strong
regional demand and the relaxation of foreign-exchange controls, which has led to more exports moving out of the black economy and being officially recorded. Import spending growth will remain strong over the outlook period, partly because of the ongoing process of tariff liberalisation, but also because of healthy demand for capital goods related to some large infrastructure and construction projects. With all these factors taken together, the trade deficit will widen to about US$900m (1.6% of GDP) in 2009, before narrowing to about US$650m (1% of GDP) in 2010.

Comments (18)


1. ATASSI said:

Nice Pro Basher peace !!But I still think Syria has been and still ruled by Fear ..

We all know the Inner ruling bosses =” are”= untouchable, They deeply believe of superiority by all mean, they are surrounded by exceptionally brilliant advisors .. handful of bosses!!Normal citizens may have choices to be part of a-b-c

a- YOU choose to be with US “ loyal”== Enjoy it.. But be aware you are dispensable anytime, and you are expected to be sacrificed….”has a base of 20% of the social pie at max “ they come from all walk of life and sects ”
b- Against us” disgraced by bosses ”== The authority will make your life and anyone close to you Extremely difficult “ very few BUT visible in the general society”.. has a larger base of compassions form all sects …
c- ordinary citizens setting on the sideline, inactive and not willing to be active in the political life= working, breeding and serving the society elite …

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October 15th, 2008, 6:06 pm

 

2. Observer said:

It is GWB that broadened the base of Bashar as he wrecked Iraq. The desire for stability in the face of the calamity in Iraq is the only reason people are tolerating the regime.
All of the so called Arab countries are medieval in the governing structure, the only thing lacking in comaprison is the ” droit de cuissage” the right of ” primae noctae” that gave permission to the local lord to be the first visitor to any newly wed.
Nepotism, corruption, inequality, injustice, arbitrary rule, widening economic disparity, absence of modern education, and God forbid that you enter a public hospital you might never leave. Although in my last visit things have gotten better, it is not by any means comparable to any hint of approaching civilization. There is a lot of barbarism around just under the veneer of a semblance of modernity with a nice spouse and a few chubby kids for the photo op.
The only difference between all these potentates is in the degree of ridicule that they think they do not have. The point of reference is Gaddafi if you know what I mean.

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October 15th, 2008, 7:05 pm

 

3. Qifa Nabki said:

Although in my last visit things have gotten better, it is not by any means comparable to any hint of approaching civilization.

Observer,

What is civilization?

I agree with you that things are bad, that the Arab countries are armies not states. In fact, if you were a bar-room pianist, you’d be playing the songs before I requested them.

But given your frequent and deep criticisms of the U.S/Europe, I’m curious about what your personal yardstick is for “civilization”.

ps: Alex, I see that “Nicosia” has now made it onto the list of anti-spam words. What’s next? Limassol? Kuwait City? Amman?

🙂

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October 15th, 2008, 7:33 pm

 

4. Qifa Nabki said:

Naharnet: “The Central News Agency said Syria has chosen an apartment in the Beirut district of Ein Mraisseh to host its embassy.”

An apartment?? Not even a house? This is genius, pure genius, on Bashar’s part. “You want an embassy? Here ya go.”

What I’d give to write that classified ad…

“Wanted: 1BR apt in Ein Mreisseh, no A/C or concierge or moteur or elevator necessary, 1 parking spot, willing to pay $450 per month maximum. Interested parties please contact H.E. Walid al-Moualem, Syrian Foreign Ministry, Damascus, Syria.”

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October 15th, 2008, 7:54 pm

 

5. haboushi said:

every one forgot about that baathist conference because it was and will always be on papers only. it looks only Dr landis is the baathist here.

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October 15th, 2008, 8:31 pm

 

6. Observer said:

Civilization is the organizational structure of a society. It is different than its culture and interacts with it in a two way system.
There is no perfection in any civilization as it is a human manifestation. The Western civilization having accelerated its industrial development in the 1600 used the technology to expand physically and culturally. The wealth generated allowed for better organization and education and hence improved continued expansion, domination abroad while providing for freer, healthier, and wealthier population at home.
The set of premises of the social contract that constitues the cultural basis of the West has developed hand in hand with the civilizational organization of the society. In inner dealing and action and the ability of the West to organize the sum total of human activity in association with technological innovation has permitted a full control of the rest of the world and its resources.
My observations are that
1. This state of affairs is coming to an end fast
2. The contradictions of the Western discourse are no longer hidden from the rest of the world
3. The ability to organize and educate is not exclusive to one nation but can happen to any other nation
4. The moral imperative of the improved situation for the Western population do not absolve the civilization of its contradictions and immoral actions in the rest of the world.
5. The absence of an effective organizational structure in the Arab regimes does not negate the legitimate grievances of the Arabs be it Palestinian rights, human rights, or the fact that they are forcibly divided into artificial entities.
6. The outcome in the Arab countries in my opinion necessitates the reconstruction of the cultural-civilizational discourse whereby the methods and means used to organize the society have to been rooted in the culture. As history has demonstrated, any other scheme has failed as it failed to move the people, fire the imagination, and mobilize for a common cause.
7. Which brings me full circle to what I wrote above: the current structure of the regimes in the Arab world constitute a civilization that has failed in organizing the society, create the conditions for the minimum guarantees of cohesion: namely education, health and most important of all an independent judiciary. It also failed to engage the population in the essential dialogue of establishing the socio-political contract that permits an engagement of the population. We do not have to go to Rousseau or Montequieu for that, the acceptance speech of Abu Bakr is sufficient as a starting point.
Barbarity rules; and will be most difficult to overcome in the two opposing poles of the Arab regimes: Lebanon because the “elits” think that they are properly civilized and the wealthy becasuse they think that wealth can buy modernity.

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October 15th, 2008, 9:22 pm

 

7. Alex said:

Qifa Nabki,

Syrians do not like to show off …. like you know who.

: )

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October 16th, 2008, 1:23 am

 

8. norman said:

Bashar assad did more for Syria in the last 8 years more than his father did in many more years , He saved Syria from an Iraqi style civil war , opened the economy to the point that the people are happy enough not to care about the politecal system ,
For the above reason , Yes he expanded his base , so Dr landis is absolutely right , I want to add that he is confident enough to eat out and drive his own car , and that is something his father could not do.

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October 16th, 2008, 2:03 am

 

9. Enlightened said:

Good Post!

And a very good question that was posed by Josh’s post.

Obviously Bashar’s regime lacks the the distinctive suffocation and paranoid fear that predated the commoners life in his fathers time. Thats a big PLUS.

But is his social base eroding? This is a underhanded question I feel. Does Bashar’s rule derive from a social contract that he has with the Syrian society? Nope. Was Bashar democratically elected? Nope! Does Bashar really depend on his social contract for legitimacy? Nope.

The Security and Army Barons are where his contract exists. These are his power leavers. It does not matter where or what the general populace thinks or does. As a Dictatorship you don’t build impressive state security institutions, because you have a social contract with society, you build them , maintain them and reward them because you fear the general populace. This is the Social contract. Lets not kid ourselves otherwise.

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October 16th, 2008, 3:05 am

 

10. why-discuss said:

QN

Are you suggesting that the Syrian embassy should move back to the Ramlet el Baida.. for the sake of continuity?
Lebanon has offered to Syria a better way to closely watch and influence the country: a “legal” embassy. Remember the back and forth of the 14 march leaders at the US embassy not long time ago. After the self-congratulations, watch the coming accusations of 14 March that the mokhabarat are back in action, following the next security incident in Lebanon.

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October 16th, 2008, 5:13 am

 

11. Rumyal said:

Qifa Nabki,

I was also wondering about Nicosia in the otherwise pure-Syrian list of locales but a single visit to Nour’s blog at http://nationalupdates.blogspot.com/ made it all clear…

This is a blog discussing the latest events concerning the Syrian Nation, which includes today’s Lebanon, Syria, Palestine, Jordan, Iraq, Kuwait, and Cyprus.

You know what’s next: Malta!

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October 16th, 2008, 5:18 am

 

12. Zenobia said:

Syrian Embassy in apartment in Ein Mraisseh?

Did anyone mention that this used to be the well know red-light district? What kind of apartment is it really? What kind of consular services will they offer? new forms of diplomatic relations? They are taking this not showing off thing very seriously… if that is so…

I think it quite funny indeed. : )

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October 16th, 2008, 5:43 am

 

13. Qifa Nabki said:

Why-Discuss,

Are you suggesting that the Syrian embassy should move back to the Ramlet el Baida.. for the sake of continuity?

I don’t know, I kinda thought a pretty villa in Bologna would be nice, just for old times’ sake.

🙂

Zenobia,

Ein Mreisseh is a red-light district again, albeit not as flamboyantly as it once was.

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October 16th, 2008, 7:14 am

 

14. SimoHurtta said:

Surprise QN. Finland has no embassy in Lebanon, the Finnish ambassador in Syria is accredited as ambassador of Lebanon (and Jordan and Iraq). Seems that the Finnish foreign ministry thinks that in the region Syria and Israel (where we also have an embassy) matter most. 🙂

Well seriously speaking I suppose that Syria will build a big embassy when they get the land on a prominent place for that or manage to buy a suitable estate. Naturally that will demand time and meanwhile the embassy will start in a rented apartment.

A small embassy is better than a big embassy full of secret service agents and military men. I think. 🙂

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October 16th, 2008, 7:49 am

 

15. Abu Omar said:

Does anyone have any ideas as to how the Syrian Economy
will be affected by the Worldwide Credit Crunch?

Will Syria’s semi-socialist economic system be resistant
to the boom and bust nature of capitalism?

Sorry for the general nature of the Question but I can’t see how it can directly affect Syria for the following reasons.

1) Syria ( correct me if I am wrong ) is in debt to Russia which is fairing quite well in the current climate
2) The Syrian government owns a 20% stake in each Company.
3) A very small percentage of the population has access to borrowing whether that be in the form of Loans or Mortgages.

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October 16th, 2008, 8:37 am

 

16. Qifa Nabki said:

Simo

I’m just having a little fun with my friends here on SC.

I’m sure Syria will have one of the most important embassies in Lebanon soon enough, regardless of whether it is situated in a huge palace or a studio apartment.

The question is, where will the Lebanese embassy in Damascus be, and who will be its ambassador?

(I think we may finally have found a good use for Wi’am Wahhab).

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October 16th, 2008, 8:57 am

 

17. Jad said:

Can you imagine building a nice and big Syrian embassy in Beirut just to be burned at the first ‘shabab’ rising!? I’m with a small studio that they can renovated faster..:)
As for the Lebanese embassy, I think they are going to use Mr. Hariri house in Aburummaneh, beside, it’s next to the KSA embassy and it’s fancy as the Lebanese like their things to be…
The ambassador won’t be weam wahab for sure…they might ask someone that Damascus hates…as Ghazale being the first Syrian ambassador their…can you imagine? (I highly doubt that)

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October 16th, 2008, 6:17 pm

 

18. norman said:

Abu Omar,

I think that the Syrian people are fairing better than the people in the West because they are used to put their money under the mattress , they rarely put money in the bank , at least that was the case long ago, they fear government confiscation.

They eaither use cash to buy houses or use government supported financing through labor or professional organizations.

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October 17th, 2008, 1:55 am

 

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