April 19 (Bloomberg) -- Sometime after midnight on a recent Thursday in Damascus, restaurant manager Aziz Asfahani joined friends at the newly opened Bartini lounge bar, where Syria’s elite dine and dance till dawn on tabletops to the thump of patriotic songs.
“People seem more comfortable and the international situation is more relaxed,” said Asfahani, 30. Last month, at the height of international pressure on President Bashar al-Assad’s government, Syrians were disinclined to venture out, leaving restaurants and bars less than half full, Asfahani said in a telephone interview.
Highbrow social and cultural life continues in the city’s downtown area. An audience of about 700 saw the U.K. conductor Howard Williams, indirectly funded by the British Council, at a Syrian National Symphony Orchestra concert on April 3. Williams, who said in an interview that he attended to show support for Syrian musicians, also noted that much of everyday life goes on amid an “inescapable” military presence and checkpoints.
An improved mood among upper-class supporters of President Bashar al-Assad follows army advances against lightly armed rebel opponents which preceded last week’s cease-fire accord to end the 13 month-long civil conflict. The subsequent crackdown has left more than 9,000 dead, according to the United Nations. The truce, monitored by UN personnel, has been patchily observed with Syria’s opposition saying shelling of residential areas has continued.
‘Decade of Instability’
Security forces killed at least 46 people yesterday, the Local Coordination Committees said in an e-mail, while the French Foreign Minister Alain Juppe will host a meeting in Paris today to discuss further action against the Syrian government and in support of the opposition.
“We are against any demands for the president to leave,” Asfahani said. “People look at what’s happening in Egypt and Libya and they don’t want the same to happen to them.”
The business elite is largely drawn from the majority Sunni community, concentrated in Damascus and Syria’s second-largest city, Aleppo. They have mostly stood by Assad, even though the president and many of his top security officials belong to the Alawi minority sect, which is affiliated to Shiite Islam. The private sector includes communications, export and import, agriculture, textiles and food canning, though many areas of the economy remain state-owned.
“They’re frightened that a victory for the opposition means a decade of instability” if rural-based anti-Assad forces lacking economic competence take power, said Joshua Landis, director of the Middle East Studies program at the University of Oklahoma in Norman, who once lived in Syria.
The commercial elite see the opposition as “a disorganized bunch of country bumpkins” who will take over and “stuff the ministries full of their friends,” Landis said.
“The richest Syrians have ‘wikaleh’ or the exclusive right to import a certain product, which can make them very rich,” Landis said. In addition, the country’s wealthy have put their money into land and real estate which are viewed as among the most secure investments, he said.
Syria’s uprising began in March 2011 when protesters in several cities and towns took to the streets to demand political changes, including an end to the emergency law suspending many individual rights. Assad, whose family has run the country since his father, Hafez, became president in 1971, was slow to respond, leading protesters to extend their demands to include his removal.
“Those who have been connected to the regime and whose interests lie with it, they simply don’t feel the pressure to move away from the regime,” Salman Shaikh, director of the Brookings Doha Center, said in a telephone interview. “In fact, the last two months they’ve probably decided it’s not the time to move.” Government supporters believe that Assad is winning and is crushing the security threat, he said.
Even so, the conflict has inflicted serious damage on the country’s economy.
Syrian output shrank by 3.4 percent last year according to a March report by the Economist Intelligence Unit, and will contract another 5.9 percent this year. The country’s budget deficit will probably widen to 18 percent of gross domestic product, the EIU forecast.
Oil output probably dropped to about 280,000 barrels a day in January from an average of 390,000 barrels in 2010, according to the Paris-based International Energy Agency. Western sanctions have forced Syria to seek buyers in Asia who are likely to demand discounts, the EIU said.
The pain has been worst for middle and lower-income groups, said Bassam al-Malak, a Damascene merchant and member of the board of the Chamber of Commerce who belongs to the National Coordination Committee, an umbrella for opposition groups, in interviews from the capital.
Other rich Syrians have simply left the country for the duration of the troubles, “because there’s nothing that they can do at the moment, there’s no business being conducted whatsoever” said Ayesha Sabavala, Syria economist at EIU.
Those who have stayed and enjoy the capital’s nightlife “are a tiny minority whose lifestyle doesn’t represent the lifestyle of the rest of Damascus,” al-Malak said. Pro-government Syrians are “those who benefited from the regime and they want to safeguard their gains.”
The country’s currency has plunged in value from 47 pounds per dollar to 72 pounds per dollar. Power cuts can often last for half the day.
Manufacturers have also suffered, with about 60 percent of factories that produced kitchenware, textiles, canned food and other products forced to close down, mainly because they cannot sell their goods abroad due to the sanctions, al-Malak said. Those producers still open have slashed staff by 40 to 60 percent, he said.
‘Playing Both Sides’
Andrew Tabler, a fellow at the Washington Institute for Near East Studies and author of a study of U.S.-Syrian relations, said some business leaders are “playing both sides of the fence,” covertly funding the opposition while not publicly abandoning Assad. For such figures, “now comes the hard part,” deciding which side they’re on, he said.
A regular European visitor to the city, who asked not to be named for reasons of personal security, said that among educated Syrians he’d met, even those who opposed the government, there were severe misgivings about what might follow Assad’s rule. They feared a possible rise to power of extreme Islamists, he said.
Meanwhile, government supporters such as Amir al-Abed project a business-as-usual attitude. Al-Abed, one of Bartini’s owners, opened the lounge last month, undeterred by the conflict.
‘Why Be Scared’
“Why should we be scared?” al-Abed said in a phone interview on March 30. He said he expected 210 diners that night. The restaurant’s official capacity is 150.
Asfahani is having a similar problem at his restaurant, Naranj, just off the Biblical-era Straight Street in Damascus’ old town, where Assad has been seen dining in the past.
Ranked the city’s No. 1 by reviewers on the tripadvisor website, it too is fully booked again. “If you don’t have a reservation for tonight, you don’t eat here,” said Asfahani in a March 30 telephone interview.
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