The cost of the Syrian revolution for the man on the street

Amid the bloodshed, talking money seems oblivious and rather ignorant too.

If such a statement was to be phrased as a true or false question, only a few would think about it; those few might be the ones that actually rule the world.

Many have argued that the invasion of Iraq in 2003, “Operation Iraqi Freedom,” made a lot of business sense. Eight years later, the same logic was applied to NATO’s involvement in Libya which ultimately helped topple former leader Muammar Qaddafi. For a skeptical few, the two countries provided an economic allure that justified military intervention.

Today in Syria, however, such an intervention has been put aside ─ at least for the time being due to various intertwining factors. These factors include exhausted balance sheets of the countries that are expected to take part in the military operation.

Another aspect that makes intervention more challenging is that Syria has very little economic incentives to offer. Nevertheless, the economic element of the Syrian equation might be crucial in deciding how the current saga will unfold, and that is why sanctions, freezing of assets and travel bans might be more efficient than the beating of war drums.

It will all boil down to bread and butter.

Despite repeated claims by the Syrian regime that the economy can weather international sanctions and consequent isolation from the global system, the bruises can no longer be concealed. Inflation is sky rocketing in Syria since the local currency lost more than 55 percent of its value against the dollar. And although the central bank is referring to black market rates as fictional, they remain the most valid indicator to the value of the Syrian pound. After all, it is demand and supply that separate fact from fiction.

Prices of basic staples for the typical Syrian family have also sky rocketed, exacerbating everyday challenges for the Syrian people irrespective of their stance on the revolution. Inflation is likely to touch 12 percent this year according to the Economist Intelligence Unit.

The financial woes are not exclusive to the people; the government is facing even worse challenges. Every source of income the government has lost as a result of the increasing pressure by the international community is difficult, if not impossible, to replace.

According to IMF estimates, oil revenues represented between 21 percent and 30 percent of total government income in the years 2006 to 2010, grossing $2.8 billion in 2008 and $2.4 billion in 2009. The Syrian Minister of Petroleum estimated in January a loss of $2 billion from sanctions on oil exports. Since the EU imposed its ban on importing Syrian oil, no solid alternatives have been found to channel Syrian oil exports. Although some argue that China can replace the lost markets, Beijing’s stance on Iranian oil exports says a lot about what to expect in the case of Syria. It is true that finding clients for oil is never a mission impossible, but selling it for good prices is.

All major sources for the government’s income have depleted. Tourism, which secured more than $8 billion in revenues in 2010 and provided much of the foreign currency reserves, has stopped with no sign of it picking up anytime soon. More than $10 billion in exports annually, including oil, have fewer and fewer channels everyday given the escalating sanctions. Foreign investments have dried up with little hope of revival given the business climate in Syria that Maplecroft, a UK based consultancy, considers one of the 10 most dangerous countries for investors in the world.

Any revolution is a dynamic process. Many were, and still are, betting against the revolt in Syria, citing the regime’s power and the hesitant reaction of the international community. But it is important to detect shifts or changes in the core element of a popular revolution, which is the man on the street. Not everyone will fight for democracy, but none will stand still when there is no food on the table.