It’s pretty much a given that Bashar Assad has defied the odds and won the civil war. In the last several days he has been performing little more than mopping up by eliminating the rebel stronghold that had once been the cradle of the rebellion in Daraa Province.
But what next? Assad’s victory looks to be about as Pyrrhic as they come. Much of Syria lies in ruins. By some estimates, its economy has shrunk by 60% or even more. More than 12 million of the country’s pre-war population of 22 million are living as refugees inside or outside Syria.
The cost of rebuilding the country is usually estimated at about $250 billion, of which the regime itself says it can cover maybe $8 billion to $13 billion. Assad’s allies, Russia and Iran, are too cash-strapped to finance a reconstruction effort even if they could perform the construction work that’s needed.
China isn't a likely source. Anxious about mounting foreign debt, it has been having second thoughts about committing itself to funding infrastructure projects in dubious places where the prospects of getting paid back are poor. The West might be blackmailed into helping rebuild Syria as a way of enticing Syrian refugees back home, but as we will see shortly that is highly unlikely to happen. The Gulf states, the Middle East’s traditional moneybags when it comes to rebuilding, are cash-strapped too and are highly unlikely to help an Iranian client state rebuild.
My guess is that Assad isn’t the slightest bit concerned.
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Crony capitalism as policy
The Assad clan was never overly concerned about economic development. The economy was simply another item in the regime’s political-power tool box: When Assad Junior dropped the socialism that characterized Assad Senior’s rule, he transitioned to crony capitalism. He never intended to give a moribund economy a free-market boost. It was a way to reward allies with licenses and monopolies.
The war transitioned the Syrian economy into the control of a new class of cronies: militia leaders who helped Assad against the rebels, and specific minorities (who backed Assad for fear that the alternative to him was Islamic rule).
As The Economist and others have reported, the Syrian government has been massively transferring assets from the Sunni majority to its supporters. Empty homes have been handed over to Shia militiamen and Syria’s Law 10 legalizes seizures of properties unless the owners act to re-register them in their names – an impossible task if you’re one of the 12 million-plus internally displaced or overseas refugees.
In Syria’s cities, whatever development is being undertaken favors minorities – Christian, Shiite and Assad’s own Alawites. The other minatory, the Kurds, are cut off from the rest of Syria in their own fiefdom. Syria’s minorities are quite content with the situation: the political threat of Islamic rule has been removed and they are being rewarded with property and business opportunities. They're hardly likely to rebel.
But Assad’s biggest achievement from the war is to create a new, smaller Syria that doesn’t need all that aid that the experts say he will need for reconstruction.
The six million-plus refugees living outside Syria now, mostly in adjacent countries aren’t going home anytime soon. The regime has made clear they are not welcome. Many know that even if they could return, their homes and villages have been occupied by others.
Another approximately 4.5 million Syrians live in the Kurdish-ruled north, which the Assad regime isn’t anxious to take back. Another 400,000 were killed in the fighting.
Assad’s Syria 2.0 will have a halved population of just 11.5 million. The 60% drop in GDP suddenly doesn’t look so disastrous in a per capita basis.
There’s still a lot of rebuilding to do, but suddenly the task looks are a lot more manageable. The homeless can be given homes that were abandoned. There's no need to build more because there is no one to live in them.
The same applies to factories, highways and schools. In the 40% of Syria the regime controls, water and power are already mostly available. There’s no need for big investment there either
Eastern Aleppo remains mostly in ruins a year have being re-conquered by the regime from rebels. But its population is down to 2 million from 3.2 million before the war and it’s likely to stay that way for the foreseeable future. Except for some cosmetic restoration of historic sites and government buildings, there's little need to rebuild.
The cost of proving shelter, schools, healthcare and jobs for the more than six millions Syrians living abroad as refugees will be the problem of their host countries and the international community, not Assad’s.
Of course, if Assad had grand plans to turn Syria into a thriving, growing economy, he wouldn’t have the financial and human resources to do it, but that was never his goal to begin with.
The Syrians who are left will be reasonably content; and his continued rule is ensured. Anyhow, foreign aid would have meant ceding control to aid agencies and foreign investors, something the regime would be loath to do.
Cynical as may seem, Assad’s Syria 2.0 will turn out to be a good neighbor for Israel. Shorn of much of its population and with a shrunken economy, it won’t have the people or money to field an army of the size and scale it did before the civil war. It will be more reliant on the Russians as guarantor of the regime’s survival, and Moscow has already made clear it has no interest in its client state stirring up trouble with Israel.
Oddly, the losers of the way may well end up being the countries straining to host the Syrian refugees who will never go back. The Syrian Sunnis themselves are losers, too. But for Assad and Israel, it looks like a win-win.