business

Beer, Bikinis, And Eavesdropping

Whenever I have a spare hour in Damascus, I head for the rug bazaar. It's a warren of ancient alleyways and hole-in-the-wall shops near the covered entrance of the Souk al-Hamadiya, one of the finest old markets in the Middle East. The owners sit alongside the narrow streets drinking coffee, with richly colored textiles from Iran, Turkey, and the Caucasus hanging from balconies and doorways.

I go to relax and talk with old friends in the quiet, marble-floored rooms above the shops. Security-obsessed Syria is not the sort of place where it pays to stop a man on the street and ask for his thoughts on President Hafez al-Assad. But once you get to know a souk merchant, he may tell you quite a lot about rugs and other things as he unfolds his musty carpets.

On this visit, my fifth in 11 years, I learn how to disguise a bad spot in a rug with a felt-tip pen and a few other tricks of the trade for sprucing up antiques. But I am more interested in finding out what the rug sellers have to say about business and politics in Damascus these days. They seem more hopeful than ever that the government is at last going to get out of their hair. "Look, there is no longer any trouble about money," says one dealer, as he gestures with pleasure toward an American Express Card machine that, under new currency regulations, means that foreign customers can pay without hassle. Until a few months ago, he had to take customers' personal checks across the border to wild and woolly Lebanon to cash them.

MORIBUND. The card machine represents part of the more accommodating new face that Assad is trying to put on Syria as he angles for cash from the Saudis and Kuwaitis in return for his support in the war. He's also hoping to win official favor from Washington in possible negotiations with Israel. Assad has watched with great unease the crumbling of his patron, the Soviet Union, and its Eastern European empire. With his own economy moribund and deeply in debt, he realizes that he has little choice but to back away from the socialist principles Syria had adhered to since his Baath Party took power in 1963.

The entrepreneurial talents of the Syrians are legendary. Syrian-Lebanese emigrants (Lebanon was part of Syria until 1920) are business leaders in Saudi Arabia, Latin America, and West Africa. With its fertile farmland, growing oil production, and near-matchless Roman and crusader ruins to lure travelers, Syria is a potentially rich country. Instead, it has stagnated under the meddlesome bureaucracy of the Baath regime. Per capita income is only $1,700 a year.

Defense spending has eaten up more than 50% of government outlays in recent years, and Syria's reputation as a frequent Middle East combatant--as well as a haven for terrorists--has scared away all but the most adventurous tourists and foreign investors. When I visited the colossal ruins of Palmyra, a Roman colony that once straddled the caravan routes between Damascus and Baghdad, I had the magnificent place to myself.

Assad is already taking some baby steps toward change. Along with allowing unfettered flows of hard currency into the country, he has approved a more liberal foreign-investment law. In politics, his fellow Baathists are quietly feeling out a few well-known but nonthreatening opponents about broadening the regime.

Most people don't realize that, in some respects, Damascus is far more tolerant than its neighbors. In comparison with Saudi Arabia, for instance, it is positively libertine. Beer and liquor are served in restaurants, and Syrian women dressed in scanty bathing suits and spike heels grace the swimming pools at fashionable hotels.

But one wonders how far Assad can go toward liberalization. Despite the relaxed attitude toward personal habits, Assad is a leader from an unpopular minority religious sect, the Alawites, and he probably can't afford to soften his iron-handed rule.

The guardians of his regime are the military and a half-dozen intelligence services that employ thousands of agents to spy on the populace and each other. Their jeeps and Range Rovers are ubiquitous in Damascus. While arrests are neither as frequent nor as arbitrary as they were a few years ago when the regime was fighting for its life against a ferocious Moslem fundamentalist insurgency, the security services still are feared. "It's better not to attract their attention," said one souk merchant. "They will have questions, and you may not have the right answers."

ESPIONAGE SCRAMBLE. One comes across the influence of the security services in strange, often humorous ways. A European businessman gazing through a telescope on his balcony near Assad's residence is told to put the instrument away and never use it again. Syrian intelligence seems partly to blame for the country's notoriously poor telecommunications. Fax machines are not permitted, and computer transmissions always seem to wind up garbled--either because of intentional jamming or, some say, because so many people are listening in on the lines. "We don't do any business on the telephone," said a Western diplomat, declining during a call even to divulge his embassy's estimate of Syria's economic growth last year. The need to be vigilant toward Israel provides an excuse for all this security, but it's really aimed at maintaining internal control.

Unlike Baghdad, though, Damascus has a handful of dissident intellectuals and political activists who will state their views of the regime frankly, if anonymously. On every trip, I call on one such person, a respected former cabinet minister, in his downtown office as his employees are leaving for the evening. When I first met him in 1980, the regime looked shaky, and his analysis of its weaknesses was bold and fresh. Now, he doesn't seem to have much hope for change in his lifetime, and he looks to have aged more than the 11 years. He dismisses any suggestion that much will come of Assad's new interest in liberalization. "A truly free private sector would be a threat to the regime's control," he says.

I'm afraid he is right. But I'm not overly concerned about the survival of my friends in the souk. They are clever enough to function under any regime. On this trip, I even discovered that some are engaged in an unusual bit of international trade: picking up old Oriental rugs cheap in New York and selling them to Western "connoisseurs" in Damascus.

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