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Business divided on Assad

Reese Erlich Nov 3, 2011

Business divided on Assad

Reese Erlich Nov 3, 2011

Kai Ryssdal: There was an Arab League meeting yesterday in Cairo at which the Syrian government agreed to pull the Army out of key cities in that country. The pledge has apparently lasted less than 24 hours. There are reports at least 12 people have been killed in Homs today.

Syria’s in its seventh month of increasingly violent unrest. Through it all, the business elite has remained mostly loyal to the government. But Reese Erlich reports from Damascus, small businesses are stuck.

Reese Erlich: Rana Issa walks into the office of her once-successful marketing and advertising business in Damascus. She proudly plays a nationwide radio spot her company produced for Construction Week magazine just last summer.

But after seven months of protests in Syria and newly imposed international sanctions, the construction industry here is grinding to a halt. That impacts medium-sized businesses as well. Issa recently laid off 25 percent of her staff. But she blames the pro-democracy protesters — not the government of President Bashar Al Assad.

Rana Issax: I love Syria. I love the president. I love everything he does. He gave us a lot of promises and achieved a lot of targets he talked about before. The opposition, they didn’t give him time to work on this.

Most of Syria’s business community does not support the pro-democracy movement, according to Nabil Sukkar, a former World Bank economist who now heads an economic consulting firm here in Damascus. He says elite businessmen enjoy great wealth under Syria’s system of crony capitalism, where friendship and political connections play a great part. Sukkar says these business people are, above all, pragmatic.

Nabil Sukkar: They expect that the unrest will come to an end sooner or later. The regime is well entrenched. The army is definitely supportive of the regime. It is not expected to split like we have seen in Libya. That’s not expected at all.

But if big business remains loyal to Assad, small business appears politically divided.

Here in Damascus’ main souk, or marketplace, business is slow — very slow. The once booming tourism industry has collapsed. This clothing store owner hasn’t seen a single foreign customer in three months. The man, who asked that his name not be used, was once a strong supporter of President Assad. Not anymore.

Clothing store owner: The government made many mistakes. It should have put on trial the police who beat young people. It should have put the corrupt officials on trial. Young people weren’t originally calling for the downfall of the government. But now they are. They are fighting for their rights.

Economist Nabil Sukkar says that at least for now, such sentiments are in the minority among business people. But he says, if the political mood shifts, that could spell the end of the Assad government.

Sukkar: Of course, if there are any strikes or serious opposition on the part of the business community, they could paralyze the economy. Any major boycott or opposition on the part of business would paralyze any economy. If that is going to happen here, it would be disastrous. But frankly I don’t see that happening.

Whatever economists and business leaders say about the government’s stability, the determining factor may ultimately be sentiment on the Syrian street.

In Damascus, I’m Reese Erlich for Marketplace.

Reese Erlich received a grant from the Pulitzer Center on Crisis Reporting for his coverage from Syria.

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