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Iran, Russia, China prop up Syria economy, official says

June 28, 2013 at 2:30 AM   |   Comments

DAMASCUS, Syria, June 28 (UPI) -- Iran, Russia and China are helping Syria lessen the sting of Western sanctions with $500 million a month in oil and vast credit lines, a Syrian official said.

"It's not that bad to have behind you the Russians, the Chinese and Iranians," Qadri Jamil, Syria's deputy prime minister for economic affairs, told The Financial Times.

"Those three countries are helping us politically, militarily -- and also economically."

Russia and Iran have publicly acknowledged their support for the regime of President Bashar Assad, but China has been less open.

Beijing had no immediate comment on the article.

Ships "under the flag of the Russians" deliver oil and related products to Syria, Jamil said without giving details.

"We are waiting for someone to attack them," he said.

Syria's coasts are still regime-controlled.

Other support from the three countries includes an "unlimited" credit line with Iran for food and oil-product imports, Jamil said.

Syrian Central Bank Governor Adeeb Mayaleh told Syrian state-owned newspaper Tishreen May 27 the credit line from Iran to finance imports and oil and gas purchases was up to $4 billion.

Tehran is itself the subject of damaging Western sanctions, imposed to pressure Iran into ending its suspect nuclear program.

Syria has also set up barter deals with Baghdad, Mayaleh told Tishreen.

Iraq is also supplying Syria with oil and gas needs, a senior Syrian petroleum ministry official told The Wall Street Journal.

Jamil acknowledged to the Times Syria's war-ravaged, sanctions-debilitated economic situation was "complicated and very difficult."

Since the outbreak of the Syrian civil war in March 2011, the economic sanctions have restricted trade with the United States, the European Union, 12 non-EU European countries, Canada, Australia and Japan.

The sanctions and the instability brought on by the war have crumbled Syria's economy, collapsing its main money-earning industries of oil and tourism, economists say.

The country's gross domestic product, which the World Bank estimated stood at almost $60 billion in 2010, shrank nearly 45 percent through 2012, economists and some Syrian regime officials estimate.

Since the war started, the Syrian pound has lost 70 percent of its value against the U.S. dollar.

The World Bank estimates inflation topped 50 percent last year, while independent Syrian newspaper Baladna estimated most goods have gone up an average 240 percent since March 2011.

Minimum monthly wages, meanwhile, have largely stayed the same, ranging from the equivalent of $200 to $300 depending on the exchange rate.

Despite the hardships, Damascus is getting around the sanctions somewhat by trading in Russian rubles, Iranian rials and Chinese renminbi, Jamil told the Times.

He said it was a "mistake" for Syria to have traded in Western currencies previously.

"Now we have a straight line between the Syrian pound and those three currencies, and we have got out of the circle of euros and dollars," he said.

Jamil said when a political resolution to the war is achieved, the Assad regime would seek compensation from the world powers that opposed it, just as Germany was required to give reparations to the Allied governments after World War II.

"If England feels like paying something, we don't mind," he said.

© 2013 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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