Syria's Economy Starts to Crumble

One clear sign of Syria’s distress is the condition of its banks. Deposits fell by an average of 35 percent in 2011 at Bank of Syria & Overseas, Bank Audi Syria, and Banque Bemo Saudi Fransi, according to April filings to the Damascus Securities Exchange. Lending plunged 22 percent last year. Syrians are taking their savings abroad, including to nearby Iraq—not a recent pillar of stability—where Syrian and Iraqi money-changers provide dollars for Syrian pounds, and to Lebanon for the same purpose.

The 14-month-long uprising that has claimed more than 9,000 lives is taking an increasing toll on the business class, mostly drawn from the majority Sunni Muslim community. Its support for President Bashar al-Assad, who is a member of the minority Alawite sect, could buckle as the economy continues to suffer, a result many outsiders hope will happen.