He was facing a catastrophe, complained Eyad al-Sibaei, the president of the Wathba soccer club in the Syrian city of Homs, a team that was the runner-up last season in the Syrian soccer league.
He was lamenting that Syrian soccer stars were now demanding ridiculous salaries before the opening of the new season and the transfer window, when players can switch teams.
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“Players who once played with us for reasonable amounts are now demanding astronomical sums. They say it’s because of the devaluation” of the Syrian currency, Sibaei told the French broadcaster France 24. “Players were transferred last year for as little as 35 million Syrian pounds ($17,500 at the current black market rate), but Sibaei said players are now demanding salaries of up to 60 million pounds ($30,000) for a single season,” the broadcaster’s English-language website reported.
A sale of a star player to a different team had cost about $70,000 to $80,000 per season, but now it can attain astronomical sums of almost a million dollars a season, he said. The elite teams in Syria are owned by the government, but a large portion of their budget comes from donors and fans, who have suffered enormously economically themselves due to the steep devaluation of the Syrian currency, the pound.
While top-level players admit their pay is much higher than the average wage in Syria, which is around $25 a month, they say they are now demanding higher salaries due to concern over the future – because of their relatively short professional careers and their need to save for a rainy day. The main explanation, however, is that no only can they demand such amounts. They can also get them.
The financial bubble enveloping the soccer teams in Syria is no different from the one protecting those close to regime, senior bureaucrats and particularly middlemen whose job it is to provide the consumer goods that the country is unable to import due to international sanctions on Syria. Everyone takes as big a cut of the pie as they can. The skill and connections of these intermediaries are put to the test time and again, requiring them to find cracks in the sanctions regime or to work with companies and business people outside Syria.
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Since June, the middlemen have faced new challenges. That’s when American legislation, the Caesar Syria Civilian Protection Act, took effect, imposing new sanctions on all companies and individuals doing business with the Syrian regime. But as usual, the bigger the problem, the bigger the fee that these brokers can charge for their services.
The brink of starvation
It’s a system that operates according to the 17th century French physicist Blaise Pascal’s law of equal pressure, in which the more the middlemen make, the less the public buys – because the public then pays much more for the same merchandise. It therefore seems that sanctions designed to hurt the Syrian regime are actually causing the most pain among ordinary citizens. That can clearly be seen in data on shortages published by aid agencies and UN institutions.
A report released recently by the Save the Children aid organization states that about 700,000 children in Syria are on the brink of starvation, while another 4.6 are suffering from a lack of nutritional security and have not eaten an apple or orange for more than three months.
In northeastern Syria, the situation is even worse. A quarter of all children there have not eaten fruit for over nine months. Meat and poultry are scarce and have been replaced by rice and beans. Total nutritional assistance provided to Syrian families meets only 11 percent of their needs.
In southern Syria, the border crossing between Syria and Jordan has reopened for the first time in years, and Saudi Arabia has allowed some 200 Syrian trucks to cross into its territory to export goods. The easing of the situation at the border helps farmers and manufacturers, but it also comes at a price for ordinary Syrians, because the farmers prefer to export their produce instead of selling it at local markets, and that creates additional shortages of produce, which in turn causes further price increases.
The Syrian government is now preparing the country’s 2021 budget. It is presenting what appear to be optimistic figures – providing additional assistance to the needy, along with an overall budget that would be the largest in Syrian history, including a suitable share of funding for the development of infrastructure and industry.
But like the other figures that the government publishes, the bluff is clear for everyone. In Syrian pounds, it is indeed a huge budget, estimated at more than $9 billion – but that’s at an exchange rate of 434 pounds to the dollar. In reality, following a plunge in the pound to 1,260 to the dollar and a real exchange rate on the black market of more than 2,260 pounds to the dollar – the actual budget will amount to about $3.5 billion, a third of which is allocated to debt repayment.
The development budget speaks of creating 70,000 new jobs, but the experience of last year has demonstrated that such forecasts cannot be relied upon. Of 188 promised government projects, which had been slated to provide 8,600 jobs – only 16 were carried out, and they provided just 680 jobs.
The Syrian ‘miracle’
Syria continues to enjoy the lines of credit that Iran has placed at its disposal, the extent of which is unknown. The Syrians buy their wheat mostly from Russia in return for future contracts. Most of the revenues that the Syrian government receives come from fees and taxes that cover less than half its expenditures.
That’s where an unexplainable “miracle” comes in: How can a country in Syria’s situation continue to survive economically – and still pay good salaries to its soccer players? It recalls a similar question that was asked two decades ago when the United States realized that the tough sanctions that it had imposed on Iraq weren’t driving President Saddam Hussein from power. The United States then decided to go to war against him.
It’s also a question that supporters of sanctions against Iran should also confront. Iran is a country whose economic capabilities are much greater, even under sanctions, than those of Iraq and Syria.