Syria’s new rural businessmen endanger the revival of agriculture

In her debut piece for Encyclopedia Geopolitica, Levantine politics analyst Chloé Bernadaux chronicles the rise of the new ‘conflict elite’ in Syria, how they have made their fortunes, and the impact they have and will continue to have on the recovery of the war-stricken country’s agricultural sector.

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Caught between climate change and civil conflict, what was once the Middle East’s most productive agricultural powerhouse now faces persisting challenges. Syria’s devastating internal war has wreaked havoc on farmers across the country. The UN Food and Agriculture Organisation (FAO) estimates that agricultural output has fallen by half between 2010 and 2018. In October 2019, Abdessalam Ould Ahmed, FAO’s Assistant Director-General, stressed the centrality of agriculture in accomplishing sustainable “peace and security” and addressing the stifling food insecurity epidemic affecting 6.5 million Syrians.

Nevertheless, the demise of agricultural production long predates the country’s civil war. Almost a decade before, the privatisation of collectively-owned farmlands in Northern Syria saw 40% of the country’s agricultural workforce leave their fields between 2002 and 2008. The exhaustion of land and water resources by ill-advised, large-scale agricultural development projects was soon worsened by a severe drought in the early 2010s. By exacerbating food insecurity in the North and East regions, the demise of agriculture set the stage for the still-unresolved civil war.

In addition to causing tremendous losses of agricultural infrastructure, the war has given rise to the emergence of a new class of rural businessmen, a “conflict elite” who continue to profit from the disorder by destabilising the viability of Syrian agriculture.

While it functioned as a crossroads between different regime and opposition-held areas, the rural region of Hama became a key smuggling route for fuel, fodder and fertiliser. Emerging rural businessmen capitalised on the opportunity to smuggle products through the region, and installed checkpoints to tax cargos. These businessmen then reinvested their accumulated funds by offering loans with high interest rates to agricultural producers. Consequently, the transformation of the rural political economy proved highly detrimental to agricultural production, as most farmers lost part of their capital investments to repay their debts to the new elite. To add, the monopolistic capacity gained by this elite contributed to increased costs of fertilizer, improved seeds and even electricity generators– chipping away at the sector’s profitability.

The Qaterji Brothers provide yet another illuminating example. They made their fortune transporting wheat from farmers based in Islamic State-held areas to Damascus. The growing interdependence between this new business elite and the regime became clear last January when the latter issued three contracts granting the Qaterjis’ oil refineries a strategic role in the oil distribution sector. The unfolding scheme strikes a resemblance with the previous president Hafez Al-Assad’s crony networks, which helped establish his authority in return for private contracts that enhanced their economic and political power.

It is thus no surprise that these businessmen’s new standing allows them to successfully oppose limitations on food imports and other government initiatives aimed at revamping the agricultural sector, since they stand in direct contradiction with the profitability of their smuggling activities.

Instead, the regime has opted since 2016 for Public-Private Partnership policies which allow the private sector, represented by its new cronies, to develop state assets across all economic sectors. Such a policy institutionalises war-time wealth accumulation patterns, while marginalizing the traditional rural class who would prefer to see more agricultural protection policies.

At the heart of the challenge to develop a resilient agricultural sector in Syria is the creation of incentives for productive activities by rural populations. This contrasts with the current approach which favours the undue influence of a handful of cronies over considerations of public interest.

Rather than addressing monopolistic actions and smuggling within its territory, the Syrian regime stands to set a dangerous precedent for the abusive accumulation of wealth. After decades of state mismanagement, responsible reconstruction of the country’s agricultural sector is key to restoring trust between government and citizens.

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Chloé Bernadaux received her master’s degree in International Security from Sciences Po Paris and specializes on Middle East politics, social movements and political economy. She previously conducted research on gender dynamics in the Middle East at the Arab Institute for Women of the Lebanese-American University in Beirut and was a geopolitical columnist at the Lebanese newspaper L’Orient Le Jour.

For an in-depth, bespoke briefing on this or any other geopolitical topic, consider Encyclopedia Geopolitica’s intelligence consulting services.

Cover Image: Massey Ferguson tractor, Syria, Bernard Gagnon