By Adam Coutts
This commentary was published in The Guardian on 18/05/2011
A situation that was potentially solvable has been transformed into a struggle for regime survival and possible civil war by political incompetence, hard power and acts of violence against civilians.
Syrians were not, at least initially, calling for the downfall of President Bashar al-Assad. Most had accepted a decades-long trade-off: stability, security and a decent standard of living in return for not openly criticising the government. All this in a region plagued by rampant insecurity, sectarian polarisation, foreign intervention and inadequate social welfare was an attractive option.
However, with hollow promises of reform, social policy sclerosis and increasing economic inequality, the Syrian people lost patience.
In 2006, Assad set about installing a wide range of social and economic reforms to be achieved through the 10th five-year plan, which would complete the transition from a socialist to a "social market" economy.
The plan included measures to encourage investment, enhance free trade, liberalise prices and strengthen social safety nets. There were also policy objectives to tackle human rights issues, regional development and social justice. Alongside this, the government has been engaged in various civil society ventures and creating international academic and business links.
However, 11 years since Assad came to power, not a great deal has improved for the average Syrian. This is because economic growth was concentrated in the hands of a chosen few with regime connections and was not accompanied by the development of adequate social protection measures for the masses left behind.
A number of initiatives were set up and sponsored by the government as well as the UN, EU and the German GIZ to support reform plans and tackle unemployment, such as the Agency for Combating Unemployment. Due to lack of funding, political will and mismanagement, however, these efforts have had little positive effect.
Small or medium enterprises and industries that make up a large proportion of the Syrian economy – particularly in textiles and agriculture – have faced increased competition from abroad. Additionally, the depletion of oil reserves has placed heavy pressure on the country's fiscal position, severely constraining the government's ability to subsidise fuel and certain food products – the staples to secure a minimum standard of living for many Syrians.
According to the UN, almost 2 million or 11.4% of the Syrian population are "extremely poor" – not in a position to meet their basic needs. Poverty and unemployment are concentrated in rural areas, with 58% of Syria's poor in the north-east. This may explain why rural governorates have been more restive, in addition to those suburbs of Damascus that comprise the "poverty belt".
The Syrian labour market is characterised by high unemployment, chronic underemployment, child labour and employers who refuse to enforce labour laws or provide contracts. Unions are dominated by pro-government officials.
There are no unemployment benefits and social protection measures are virtually nonexistent and – where they do exist – are often fiddled by employers.
Official statistics show that the total unemployment rate in Syria stands at 8.9%, although the economist Samir Aita estimates that a more likely figure is between 22% and 30%. The unemployment situation is aggravated by the coming of age of a large cohort of economically active youths, which will only increase given that 40% of the population are under 24.
Unemployment created by years of drought has significantly depleted the country's agricultural base, particularly in the north-east, causing a mass rural flight to the cities.
Added to this are some 1 million Iraqi refugees who came to Syria in 2006-2007 (around 7% of the total Syrian population), now residing in the country. In addition to raising housing costs and straining public services, this has greatly increased competition for jobs in the informal sector, which already accounts for a third of the labour force. Jobs for low-skilled and unskilled workers hailing from mainly rural areas also dried up in neighbouring Lebanon after tensions caused by the assassination of the former prime minister Rafiq al-Hariri.
Within the formal labour market there is a high demand for jobs in the public sector and civil service – practically the only areas that provide a minimum wage, career progression, health insurance, retirement benefits and maternity leave. School leavers and university graduates face years on employment registers in the hope of joining the state-sponsored public sector or face the uncertainty of entering the informal and private sectors.
It is not unusual for countries undergoing transition to a market economy to feel the social costs of reform before the benefits. However, in Syria social reform is stuck between the necessity of spending on national security and the vested interests of the wealthy who occupy political positions of power.
For the scale of the economic and social problems that Syrians face, too much has been promised and too little delivered. For most, this has been indeed a wasted decade characterised by poverty, unemployment, inequality and lack of opportunity, which has now cost hundreds of lives and could cost Assad his power and the region its stability.
Opportunities for gradual change are dwindling by the day as the government steps up its crackdown and the security situation continues to deteriorate. But whatever the outcome, political, social and economic reform in Syria is inevitable.
Such reforms must recognise the vast inequalities in wealth and opportunities that have opened up between the small class of haves and the mass of have-nots in Syrian society and across the region. Arab leaders take heed: ignore the social conditions of the people at your peril.