Among the less discussed symptoms of the collapsing Syrian state is the realigned trade balance with Lebanon. Before, everything from gasoline to eggs was sourced cheaply in Syria and sold lucratively in Lebanon, an equation amounting to a multi-billion-dollar trade deficit for Lebanon. Today, the balance of payments is much more even. In Syria, shortages and hobbled transportation networks are fuelling inflation and reversing the flow of goods.
Another reason goods are moving the other way is the collapsing Syrian economic model. Subsidies, along with price and currency controls, have effectively vanished in much of the country as Syria is whipped from a centralized, state-controlled economy to a vicious, smuggling-based, no-holds-barred chaos form of ‘free’ market capitalism.
Indeed, the centralized state authority is evaporating en masse, with the Kurds in the east asserting more autonomy, and sectarian fiefdoms forming where once there were mixed neighbors under one government. This is far from unique to Syria — look at the Bekaa tribes uniting last month to violently fend off Lebanese security forces’ efforts at cannabis eradication. Iraq has long been divided into a Kurdish north, Sunni west and Shia south and in Jordan the atmosphere is far more charged with tribal sentiments than any time in recent history.
This general trend toward state fragmentation seems only to be accelerating, and is perhaps a natural historical consequence of the contours of these countries being defined by colonialist powers — powers that, more or less, took a ruler to a map and drew lines on it without the least regard for local demographics, precedents or relationships. As the strongmen who held this patchwork together are deposed, the fabric is unraveling and the interim period before a new one can be woven together will likely be turbulent.
For business and commerce, this means adapting to a new paradigm, and unfortunately Syria may be the harbinger of where the region is headed — the predatory, ruthless economics of war.
