Damascus, Syria David Rosenberg / The Med – Syria’s turmoil is showing signs of reaching the country’s kitchens as disruptions in transportation and trade sanctions are conspiring to shrink supplies and boost prices at a time when harvests are constrained by poor weather.

The United Nations Food and Agriculture Organization (FAO) has increased its estimate for Syria’s harvests slightly since it last officially published figures in October. But, Mario Zappacosta, economist at the FAO’s Global Information Early-Warning Systems (GIEWS), said the higher figure is unlikely to be enough to prevent a food crisis.

GIEWS now estimates the Syrian production of wheat and barley in the harvest that ended last August at about 4.2 million tons, which is up from slightly less than 4 million tons in its previous estimate. But that still leaves it below the average crop size of the previous five years. Worse still, getting the food to consumers is more difficult than ever as unrest snarls transportation and sanctions have raised the cost of fuel.

“We categorize it as a problem of access. Especially in urban areas that are affected by the security situation, it is very difficult to supply shops in the market. We can imagine a situation where there [farm] products are harvested and stored, but markets aren’t functioning,” Zappacosta told The Media Line.

Cereal crops provide the most important part of the Syrian diet and are the only ones monitored by GEIWS. But other foods, like fruits and vegetables, are even more likely to suffer from the transportation problem because they have such a short shelf life and cannot be stored for as long.

A food crisis would pose a significant challenge to the beleaguered regime of President Bashar Al-Assad, who is coping with international diplomatic and trade isolation, a contracting economy and an opposition more ready than in the past to use arms. The president has struggled to keep the economy afloat and Syrians content, raising deposit rates to support the currency and maintaining subsidies of basic goods at great cost to the treasury.

“All this is an indication to the business community that the Syrian government is floundering on how to cope with economic deterioration,” Ayesha Sabavala, an analyst who follows Syria for the Economist Intelligence Unit (EIU), told The Media Line. “A rapid decline in economy could also cause the army or people in the government to abandon support of Al-Assad. They might see support for him comes at too heavy a price.”

Some analysts say that the disruptions wrought by misguided farm policies and drought were a key factor in pushing Syrians into rebellion. The drought, which struck much of northern and eastern Syria after 2006, forced tens of thousands of farm families to migrate to camps on the outskirts of Syria’s cities in search of work.

The unrest, now in its 11th month, makes it difficult for aid workers and experts to fully assess the situation. GEIWS uses satellite images and uses estimates to arrive at its numbers for output and consumption, but like other organizations it has very little information about conditions inside the country.

Nevertheless, in its latest assessment of global food security, released Feb. 10, the U.N. World Food Program (WFP) put the number of people defined as “food insecure” at 1.4 million since March 2011, when the uprising began. Food insecurity is the most severe in “hotspots” like Homs, Hama, rural Damascus, Dera’a and Idlib, the WFP said.

The official Syrian SANA news agency said two weeks ago that the direct damage to the farm sector caused by what it called “armed terrorist groups” had reached 450 million Syrian pounds ($7.8 million). The General Organization for Consumer Products reported that food worth 250 million pounds ($4.3 million) was stolen from its warehouses in the Homs neighborhood of Baba Amr.

If it happens, crunch time for Al-Assad is likely to occur this spring. That is about the time that the 2011 harvest will have been depleted even if the entire crop reaches Syrian consumers, according to GIEWS estimates.

“In general, the country is not self-sufficient. Domestic production is enough for the first eight months after the harvest [in August] and imports start to take its place in May and June,” Zappacosta said.

GIEWS estimates the country will need to import about four million tons of cereals during the current marketing year, which is down from the 4.6 million tons it estimated in October. But Damascus will have trouble meeting even the smaller shortfall because of trade sanctions.

The European Union’s ban on Syrian oil imports, imposed last September, doesn’t include food. But analysts say it has strained the country’s finances and made traders wary about doing business with it. European traders told The Wall Street Journal last month that a risk premium of around $10 a metric ton was being imposed on all wheat supplied to Syria through the private sector.

Meanwhile, the pound has plunged more than 50 percent so that a dollar is now worth about 58 pounds on the official market and 71 pounds on the black market. Most of the depreciation occurred in the final two months of 2011.

All that has made it more expensive to buy food abroad. But the cost of trucking local produce to market and even the cost of growing it have both climbed. Syrian farmers are highly reliant on irrigation, but the pumps rely on every more costly fuel.

Even where there is food, sticker shock is the new norm for the urban consumer. Since the unrest broke out, the price of a 25-liter (6.6 gallon) bottle of cooking gas in Damascus has risen to anywhere between $8.70 and $14 from $4.30, according to IRIN, the news service of the U.N. Office for the Coordination of Humanitarian Affairs. A tray of 30 eggs has increased to between $5.20 and $6.90 from $3.10; and a kilo of potatoes to between $1 and $1.30 from 35 cents.

Syrian inflation is likely to touch 12% this year according to the EIU.

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Ankara, Turkey David Rosenberg / The Med – The Arab Spring has been tough on Turkey. Its good friend, Syrian President Bashar Al-Assad, disappointed it with a violent crackdown on protestors. Relations with Iran have grown chillier, Ankara was forced to do an embarrassing about-face on the Libyan no-fly zone and Egypt’s Islamic leaders warned it against promoting the Turkish brand of Islam and democracy.

Back at home, economic growth is faltering and the country has been subject to withering criticism for allowing the courts to lock up so many journalists. The Kurds have grown restive.

But Turkish Prime Minister Recep Tayyip Erdogan can take some solace from the fact that in the Arab world his country is as popular as ever. A newly released poll finds that Arabs see Turkey as a champion of regional peace and role model for religion and democracy living side by side.

Conducted among 2,323 people in 16 Arab countries over the last three months of 2011 by the Turkish Economic and Social Studies Foundation (TESEV), the survey found that 78 percent approved of Turkey and its policies.

“Clearly Turkey is very much admired and so it has a degree of regional leadership and the ability to pay that role,” Jonathan Levack, program officer for foreign policy program at TESEV, told The Media Line. “But it has to be careful because public opinion is volatile and the region is volatile. You can’t easily translate this popularity into political influence.”

The survey comes as the Middle East and North Africa undergo their biggest upheaval in decades. Domestically, the countries that have thrown off autocratic rule are now undergoing a wrenching debate over the role of Islam and democracy while the long-standing dominance of the U.S. is perceived by many as being in retreat, with a host of powers looking to fill the vacuum.

Turkey’s approval rating puts it way ahead of other contender’s for regional leadership, most notably Saudi Arabia (64 percent) and Iran (45 percent), while China – a potentially emerging regional power – achieved a favorable rating among 65 percent of the respondents. The U.S. garnered only a 33 percent approval rating.

Turkey scored highest in countries where the Arab Spring has ended the rule of dictators and politics is in flux. In Libya, Turkey had a 93 percent approval rating even though Ankara was late in joining the no-fly zone campaign that was instrumental in ousting Muammar Al-Qaddafi. Turkey had a 91 percent rating in Tunisia and 86 percent rating in Egypt.

But in Syria, where Erdogan has been at the forefront of efforts to force Al-Assad to step down, Turkey’s approval rating plummeted. From 93 percent in TESEV’s 2010 survey, it fell to 44 percent last year.

Moreover, 61 percent of the Arab world views Turkey as a model for their own countries, compared with 22 percent who said it was not, according to the poll. Among those who approve of Turkey as a model, 32 percent cited its democracy, 25 percent its thriving economy and 23 percent its Muslim identity.

But among those who say they do not admire the Turkish model, its biggest drawback was its insufficient Muslim identity and its ties to the West, which the disapprovers believed to be too close. Turkey is a member of the North Atlantic Treaty Organization, although its efforts to join the European Union have so far failed.

In fact, the Turkish model has started to look a little tarnished. More than 100 journalists are now imprisoned for what human rights groups say are unfounded charges of terrorism. The latest arrests prompted a public tussle between Erdogan and the American author Paul Auster, who announced last month that he would not visit Turkey due to the clampdown on freedom of speech.

Meanwhile, the International Monetary Fund is forecasting just 0.4 percent economic growth for Turkey this year, down from 8.3 percent in 2011.

This was the third annual survey of Arab attitudes TESEV has conducted as Turkey has emerged from decades of regional non-involvement to become an increasingly important political and economic player.

“Throughout the three surveys, we found Turkey was welcomed as an actor in the region by the people of the region…. that favorable option is consistent, or structural. It hasn’t been affected by the Arab Spring or by Turkey’s stance toward Libya,” said Levack.

Turks who participated in a Doha Debates roundtable at Bogazici University in Istanbul last month were less convinced of their country’s model. By a margin of 59 percent to 41 percent they approved a resolution: “This House believes Turkey is a bad model for the new Arab states.”

Ece Temelkuran, a Turkish journalist, told the audience that her country’s experience could not be duplicated in the Arab world. “Turkey has been under a state for modernism and secularism for about 80 years, which has not been experienced anywhere in the Arab world in the same manner,” she said.

But she was also critical of Turkey’s democracy, saying it was responsible for jailing journalists and criticized the ruling Justice and Development Party (AKP) for substituting military dominance over politics with a new kind of authoritarianism.

Defending the model, Sinan Ulgen, director of the Center for Economic and Foreign Policy Studies (Edam), said Turkey’s political development is a work in progress, which makes it relevant to the Arab world and a more useful mentor than Europe or America.

“The Arab people in terms of their cultural affinity have an association with Turkey. They relate to what’s going on in Turkey,” he told the Doha Debates audience. “They relate to what’s going on in Turkish society. And I think the best way to prove this argument is just to tell you that the wild success of the Turkish soap operas across the Arab world.”

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Damascus, Syria David Rosenberg (The Medi – As the Arab League agreed to go to the United Nations Security Council early this week with a resolution calling for Syrian President Bashar Al-Assad to step down, Russia was reportedly doing a major arms deal with the beleaguered regime.

The $550 million agreement to sell 36 Yak-130 combat aircraft will not do anything to tip the balance in favor of the Al-Assad regime, which has been engaged in a 10-month conflict with anti-government opposition. But Russia is almost certainly providing arms Damascus needs to hold back the rebels as well as mounting a diplomatic defense of its friend at the U.N.

In a rare glimpse into the Russia-Syria arms trade, a ship loaded with ammunition from Russia was briefly detained in Cyprus earlier this month before continuing its journey unmolested to the Syrian port of Tartus. Foreign Minister Sergey Lavrov has vowed that Russia will veto any sanctions as “unfair and counterproductive.”

“Syria is an important customer for the Russian military industry and the industry is quite keen to maintain the relationship,” Fyodor Lukyanov, editor-in-chief of the Moscow based foreign policy journal Russia in Global Affairs, told The Media Line. “Syria is one of the few remaining customers in the region and it hosts the only military base – a small one but still a base – that Russia still has outside its own borders.”

As the West – now joined by the Arab League – presses the Syrian president ever harder, Russia has emerged as his most important ally. Iran also backs the Damascus regime, but Tehran itself faces growing diplomatic isolation over its nuclear program and doesn’t wield a Security Council veto. China is opposed to Syrian sanctions, too, but analysts say it is likely to follow whatever line Moscow adopts.

Russia’s warm ties with Syria, and more exactly the Al-Assad family regime that has ruled the country four decades, starts with arms sales but it goes much deeper.

In the final two decades of the Cold War era, when the Soviet Union was a superpower competing for global influence with the U.S., Syria was its staunchest ally in the Middle East. Bashar Al-Assad’s father and predecessor Hafez armed his troops with Soviet weapons and advanced Moscow’s interests in the region.

With the collapse of communism and with Syria’s deteriorating economy, the relationship is not what it once was. But Russia maintains a naval base at Tartus and the two governments share a distrust of the West and its motives.

Indeed, the view from Moscow of what is happening in Syria is very different than the one in Washington or Brussels. Where the West sees events in Syria as a popular uprising against a repressive regime, Russia shares Damascus’ take, which sees the rebellion as conspiracy by the Gulf countries to bring down an ally of their foe Iran.

“Saudi Arabia, Qatar and others see this as an opportunity, as a chance to push back Iranian influence,” Lukyanov said. “From Russia’s point of view, it’s part of a geopolitical struggle between Iran and Saudi Arabia, where Syria is just a card.”

For policymakers in Moscow, the situation in Syria looks remarkably similar to the one in Libya last year, where another long-time friend, Muamar Al-Qaddafi, faced what was seen in the West as a popular rebellion against autocracy. Russia reluctantly agreed not to veto a U.N. decision to impose a no-fly zone over the country.

The resolution, as Russia’s leaders understood it, was to prevent Al-Qaddafi from killing civilians with aerial firepower. But the NATO forces that largely enforced the decision, Russians say, used it to level the playing field in the Libyan civil war to Al-Qaddafi’s disadvantage. Moscow lost a friend and customer for its arms and is now out of favor with the successor National Transitional Council.

Zvi Magen, a former Israeli ambassador to Russia, said Russia’s Syria policy is driven by memories of its Cold War rivalry with the U.S.

“There’s an element of business in the arms deals, but it’s mainly a political move to show the flag and to show support for Syria. It’s mainly a function of Russian relations with America than with the Syrian regime,” Magen told The Media Line.

For that reason – and because Moscow realizes that Al-Assad’s days are numbered – it may be prepared to make a deal with the U.S. over Syria, he added.

Nevertheless, analysts agree that the importance of the arms trade as a factor in Moscow’s calculations should not be overlooked. In an economy with few other industrial exports, Russia’s military industry is an important earner of foreign exchange and a powerful domestic political force.

The Voice of Russia radio’s website said in December without citing a source that Russian arms exports reached $11 billion last year, a three-fold increase from 2000. While the country’s biggest customers are India and China, the Middle East had been a growing market until the Arab Spring eliminated Al-Qaddafi and sanctions on Iran removed another customer. Syria alone, according to some estimates, accounted for 7 percent of all Russian arms sales in 2010.

A U.S. government study in 2009 estimated Russia’s share of the Middle East arms market grew to more than 15 percent in the 2005-2008 period, five percentage points more than in 2001-2004 as it offered more creative financing and payment options, counter-trade, offsets, debt-swapping, and, in some cases, licensing production locally.

Russia’s Interfax news agency reported in early December that Russia delivered $300 million of Yakhont anti-ship cruise missiles to Syria.

With numbers like that, it is no wonder that Sergey Chemezov, the head of the state arms export company Rosoboronexport, made clear he had no intention of halting business with Syria.

“There are no sanctions whatsoever regarding Syria,” he told Interfax on Wednesday. “If international sanctions are imposed by the U.N. Security Council, everything will change. And if there are no sanctions, why should we refuse to cooperate with this country? This is business after all.”

Nevertheless, Magen said, Russia is careful not to sell Damascus weapons like S-300 surface-to-air missiles that could alter the regional balance of power.

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Deir-Alla, Jordan Abdullah Omar / The Media – In the lush orchards of Abu Emad in this Jordan Valley town, lemons and oranges glisten in the sun as the day of picking draws near. The valley’s year-round mild climate, fertile soils and relatively ample water supply have made it a winter garden of cucumbers, tomatoes and other produce destined for Europe, where they are unavailable from local growers during the winter.

But this season may be different as Arab League sanctions against Syria go into effect. That is because Jordan Valley farmers like Abu Emad send their best produce through Syria to Europe, where prices are better than anything they could expect at home. The farmers, already coping with debts and water shortages, have few alternatives to Syria.

“If I’m not allowed to export products through Syria, it will be a catastrophe for me and all the communities in the region,” said the scrawny 56-year-old farmer. Unemployment in Jordan is already high and poverty is on the rise. This farm employs dozens of workers from impoverished Deir Alla and neighboring towns. “If a war starts, many people will be hurt, not only in Syria, but also in Jordan.”

Unlike Syria’s two other Arab League neighbors, Iraq and Lebanon, Jordan supported the sanctions and King Abdullah has hinted that Syrian President Bashar Al-Assad should step down after more than 5,000 people have died in a crackdown against the government. But the economy of Jordan, an important ally of the U.S., can ill-afford another blow.

Repeated attacks on the pipeline from Egypt have stanched the flow of natural gas that was once Jordan’s primary source of energy. While Abdullah faces no threat to his rule, the country has been shaken by protests calling for reform and an end to corruption. Jordan is already saddled by a record $2 billion budget deficit this fiscal year and high unemployment.

Syria and its Mediterranean ports serve as a lifeline for the kingdom, an almost entirely landlocked country. Close to 30 percent of Jordan’s exports of fruits and vegetables, about $126 million in 2010, went through Syria to Europe as well as the closer markets of Lebanon and Turkey. The ministry has said that about 3,000 Jordanian trucks will have to stop working because of the sanctions.

Syria finally agreed on Monday to let Arab League observers into the country to monitor a deal it agreed to last month to pull troops from rebellious cities, free political prisoners and start talks with the opposition. Nevertheless, the head of the League said there is no immediate plan to lift sanctions that were imposed when Damascus at first refused outside monitors.

Meantime, Jordanian traders are complaining they are being targeted by the Syrian regime, with trucks facing delays at the border and attacks by loyalists as the vehicles head north to Turkey.

The sanctions include a travel ban against scores of senior Syrian officials, a freeze on government assets in Arab countries, a ban on transactions with Syria’s central bank as well as an end to all commercial exchanges with the Syrian government. The sanctions include a ban on dealing with the central bank of Syria as well as major companies that export to the region.

If they can’t find new markets for their fruits and vegetables, the Jordan Valley’s farmers risk seeing everything fall off their branches and rot. The oil-rich Gulf states represent an option, but fierce competition from other countries such as India and strict rules on imports will make it hard to find customers countries such as the United Arab Emirates, Kuwait, Saudi or Qatar, he says.

Experts say other trade partners will have to be considered, including next-door Israel. But with the government already suffering, public opinion over the economy and political reform, expanding trade with the Jewish state would be a risky move. The two countries have a peace treaty but Jordanian popular opinion is hostile to Israel.

Sanctions will not only hit Jordanian farmers, but factories that use Syria as a route to import basic manufacturing products such as textiles and spare parts.

It will also hurt Jordanian families, which get the majority of their fruits and vegetables from Syria as well as wheat, cotton and other basic needs at an affordable price. Jordan imported some $187 million of Syria produce last year, according to Jordan’s Agriculture Ministry. Additionally, as pressure on Damascus intensifies and more refugees start to make their way to the kingdom, officials in Amman are concerned that will compound the economy’s woes by adding more mouths to feed.

All told, two-way trade between Syria and Jordan amounts to $400 million, a significant figure for a country of 7 million people and an economy worth about $27 billion. Traders say imports from Lebanon would also become all too expensive if they are to be shipped through the Mediterranean and into the Red Sea Gulf of Aqaba.

Jordan officials have sounded the alarm about the damage sanctions will impose if the kingdom’s special problems are taken into consideration. Foreign Minister Nasser Judeh has urged the other Arab countries to consider exempting the kingdom from the trade ban on Syria.

Jordan is believed to have received tens of millions of dollars from the Saudi and Qatari governments to help it accommodate an expected surge in the number of refugees. Experts say the kingdom could be given more cash from wealthier Arab League members to offset losses from cutting ties with Syria.

But Khalid Abdel Rahman, a farmer from the Jordan Valley town of Karama, expressed doubt about the aid money being spent effectively or going to deserving pockets.

“There is no transparency in these issues. If we receive aid, the government would give small amounts to certain people and leave others face the hardship by themselves,” he said.

Meanwhile, Amman has started seeking alternative routes for its exports. Talks have already held with Iraqi authorities to send trucks laden with exotic fruits and vegetables through northern Iraq and into Turkey, before reaching the European market. But the route is almost double the Syrian route and it runs through politically unstable areas, which will raise costs.

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Amman, Jordan (The Media Line) – A United Nations organization dealing with refugees has said that land has been designated in Jordan to set up a camp to deal with an expected tide of refugees fleeing unrest in Syria.

Thousands of Syrians have reportedly been pouring over the border into Jordan as a defiant President Bashar Al-Assad has ratcheted up his lethal crackdown on anti-government protesters that has killed over 3,500 as the country slides deeper into civil war.

The UN High Commissioner for Refugees (UNHCR) in Jordan is working with the Ministry of Interior to prepare a refugee camp in Mafraq north of Amman to take in the Syrians who have fled their homes.

“The area where it would be possible to receive an influx of refugees has been designated, but there hasn’t been any kind of action taken on the ground yet. No tents have been set up, but at least the land has been designated for such a contingency,”

Dana Bajali, a spokeswoman for UNHCR, told The Media Line.

Bajali said they have been providing assistance to some 200 Syrian refugee families, but that it is estimated that over 3,000 have sought sanctuary in Jordan, some legally, others illegally. Hundreds are thought to be army deserters.

“This includes urgent cash assistance, some blankets and mattresses. We also try to provide some food items to these families, kitchen sets, hygiene kits, utensils, school kits and food packages,” Bajali said, adding that most of the refugees were being housed by relatives and friends since there were close family and tribal ties on both sides of the border.

Many have come from the Syrian town of Dara’a, the birthplace of the Syrian rebellion that erupted in mid-March when dozens or more youths were detained by security forces for spray painting anti-government graffiti. Since then, despite the massive presence of troops and attacks on the city’s main mosque, Dara’a remains in turmoil.

But others have been coming from the area around Homs, the heart of the anti-Assad revolt, north of Damascus.

“We have noticed a steady influx of Syrians into Jordan and the number of those registered with us has increased. There is a plan to receive an influx of refugees if that happens and one of them is to set up a reception center, but that hasn’t started yet,” she added.

Another UNHCR official told the Ammon news website that the cost of the refugee camp would be about half a million dollars and that the tents would come from their stocks currently stored in warehouses in Zaraq. But it also quoted government officials as saying they are not formally cooperating with the UN organization.

Syria has periodically sealed its 380-kilometer (236 miles) border with Jordan since the revolt began. Last week, Syrian army defectors clashed with loyalist troops near the border along the Damascus-Amman highway and at least 40 people were reportedly killed.

Since the fighting began tens of thousands of Syrians have fled to neighboring countries. Some 5,000 are estimated to have sought shelter in Lebanon and another 19,000 are reportedly in Turkey. Hosting the refugees and allowing Syrian opposition to organize on its territory has plunged relations between Turkey and Assad’s regime to their lowest point in years.

Syria’s 22 million people are not only feeling the pressure of growing causalities and fighting but the economic fallout. Syria has been hit by international sanctions and other measures that may cause the economy to contract by as much as 10% this year. Even those who can’t or won’t leave have been sending capital out of the country.

Two rocket-propelled grenades hit a major ruling party building in Damascus on Sunday, residents said, the first reported attack by insurgents inside the Syrian capital. Meanwhile, the Arab League said it rebuffed a request by Syria to amend plans for a 500-strong monitoring mission after Al-Assad disregarded a deadline to halt violent repression of protesters.

Unlike Turkey, Jordan is not allowing Syrian opposition groups in the kingdom. Still, there are tensions between the countries, particularly after King Abdullah last week became the first Arab ruler to call for Al-Assad to step down. Following the monarch’s statements, pro-government mobs attacked the Jordanian Embassy in Damascus.

Syria reportedly apologized to Jordan over the attack. Jordan’s state-run Petra news agency quoted Syria’s Deputy Foreign Minister Faisal al-Mekdad as apologizing for the attack on the Jordanian Embassy as well as other diplomatic missions, including the Turkish Embassy.

Last month, Jordanian Minister of Foreign Affairs Nasser Judeh said in a joint press conference with his Turkish counterpart, Ahmet Davutoglu, that the kingdom would be ready for the receiving any new numbers of refugees from Syria in the event of deterioration of the security situation there.

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Damascus, Syria David Rosenberg – Faced with growing pressure at home and abroad to end his crackdown on opposition protestors, Syrian president Bashar Al-Assad struck a more conciliatory and compromising tone in an address to the nation on Monday.

In his third such speech since unrest broke out in the middle of March, Al-Assad conceded that the nation suffered serious problems that exposed it to protests. He said the government was ready to listen to the Syrian “street” and proposed a formal national dialogue.

“We in a position of responsibility have to listen to them,” Al-Assad said in remarks broadcast live from Damascus University. “The patriotic elements have expressed their demands. They aren’t connected with any external force. They want to participate. They want justice. They don’t want to be marginalized.”

The president’s speech may have been directed at leaders overseas as much as at Syrians. European foreign ministers were due to meet on Monday to discuss Syria, as pressure grows for foreign powers to act. Syrian security forces have killed some 1,300 civilians, according to the Syrian Observatory for Human Rights. Nearly 10,000 refugees have fled to Turkey, provoking a diplomatic crisis with Ankara.

While the plan was short on details, Al-Assad offered to begin a formal national dialogue that would lead to the creation of political parties alongside his Baath Party, which now has a monopoly on political life. It would prepare proposals for a freer press and possibly a new constitution for the country. He promised parliamentary elections in August and a reform package by September.

Al-Assad also addressed the country’s economy, which has been paralyzed by strikes and protests. But he offered no proposals for economic reform, except for national dialogue on the matter.

“The most dangerous thing we face in the next stage is the weakness or collapse of the Syrian economy and a large part of the problem is psychological,” Al-Assad said. “We cannot allow depression and fear to defeat us.”

While the Syrian leader struck a more muted tone than in his previous addresses, analysts and opposition leaders said it didn’t go nearly far enough.

“I don’t see this speech as anything new or significant. It was a deeply disappointing speech. This isn’t the man to conduct any significant dialogue,” Salman Sheikh, director of the Brookings Doha Center, a Qatar-based think tank, told The Media Line.

Assad did acknowledge the grievances of ordinary Syrians, but he framed them as part of a conspiracy and blamed the protestors for stunting Syria’s economic development. “It would have been a real miss if he didn’t acknowledge any of the people’s grievances,” Sheikh said.

Shortly after the 75-minute address was over, protesters took to the streets of Damascus’ suburbs and several cities, activists told Reuters news agency. “No to dialogue with murderers,” 300 protesters chanted in the suburb of Irbin, a witness told Reuters by telephone.

“A national dialogue cannot happen when one side refuses to talk about the REAL issues and REAL situation,” said a Syrian activist based in Beirut who blogs under the name Malath Aumran. “We are on the 98th day of protest today and the Bashar is still in denial.”

Even as he admitted Syrians had real grievances, Al-Assad returned to the themes of foreign conspiracies and religious extremism that had been the focus of earlier addresses. Nevertheless, he termed the number of alleged terrorists “very few” albeit “very influential.” He signaled that he was prepared to share blame with the opposition for the deaths and chaos over the last three months.

“Imposing peace and security doesn’t justify killing people,” Al-Assad said. “Legitimate demands don’t create an excuse for people to create chaos.”

“It’s hard to interpret what this all means, because it was difficult to understand what Al-Assad was pitching. He just didn’t sell it, and we don’t know who is supposed to big part of this national dialogue,” Issandr El-Amrani, an Egyptian journalist wrote on the highly regarded The Arabist blog site. “It still feels too half-hearted.”

Syria can count on few influential friends, short of Iran and Turkey, the latter of whom had worked hard to improve ties with Syria over the last several years as part of its drive for improved diplomatic and commercial relations with the Middle East. But the strategy has run aground as Al-Assad has used violence to put down mass protests.

On Sunday, Ersat Hurmuzlu, an adviser to Turkish President Abdullah Gul, told the Dubai-based Al-Arabiya television channel that Turkey would be watching closely what Al-Assad and warned him he had little time left to save his regime by implementing reforms.

“The demands in this field will be for a positive response to these issues within a short period that does not exceed a week,” Hurmuzlu said.

Al-Assad, however, can still count on Russia and perhaps China to save him the embarrassment of a United Nations Security Council resolution condemning his actions. While several European countries have submitted a draft resolution, Russian President Dmitry Medvedev, whose country has veto power in the council, indicated he wouldn’t support it.

At home, however, there was little evidence that either the crackdown or appeals for stability and reform were working for the Syrian leader. On Sunday, opposition groups, which until now have operated as an assortment of independent and private efforts, announced they were setting up a “National Council” to coordinate the rebellion against the regime.

“We announce the creation of a National Council to lead the Syrian revolution, comprising all communities and representatives of national political forces inside and outside Syria,” reporters near the Turkish-Syrian border were told by Jamil Saib, a spokesperson, on Sunday.

With reporting by David E. Miller

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