Western sanctions on Syria have almost halved its foreign currency reserves and reduced oil production by 30 percent, costing Bashar al-Assad’s government 400 million euros ($520 million) a month in revenue, French diplomatic sources said.
Officials from almost sixty countries, including the European Union and the Arab League, meet in Paris on Tuesday to discuss the efficiency of sanctions imposed on Syria to raise pressure on Assad to comply with a U.N.-backed peace plan.
“We haven’t got a perfect measurement instrument to tell us when the regime will no longer be able to function, but we are seeing an extremely strong decline in foreign reserves. About half,” one French diplomatic source said.
Foreign reserves were estimated at $17 billion before the unrest broke out more than a year ago.
The European Union and United States have led the response to Syria’s violence with a broad range of sanctions, which include a ban on Syrian oil imports to Europe and measures against the Syrian central bank.
Prior to EU sanctions Damascus sold 90 percent of its oil to Europe and with that market closed Syrian production has now fallen 30 percent. Sources estimate lost revenues at about 400 million euros a month, or a total $2 billion since November.
“With the deteriorating economy there is a hyperinflationary context, sharp collapse of the currency and a fall in revenues. That pressure will eventually be felt,” said a second source.
Tuesday’s meeting will be attended by diplomats and finance ministry officials. While not expected to decide on new measures, the 57 countries will outline measures they have taken against Damascus and discuss how to ensure their implementation.
U.N. peace monitors arrived in Syria on Monday to oversee a ceasefire undermined by persistent violence and the shelling of opposition stronghold of Homs by forces loyal to the Syrian president.
“(Arab League-U.N. envoy) Kofi Annan needs us to apply pressure through targeted and coordinated sanctions so that Syria has no choice,” the French diplomatic source said.
“If we don’t make Syria feel the consequences of its actions then it has no interest in playing the game,” he said.
A new round of sanctions might be adopted when European foreign ministers meet in Brussels on April 23.
The Arab League has also slapped sanctions on Syrian VIPs, and recommended stopping commercial and passenger flights to and from Syria. However, unlike the EU, which imposes sanctions collectively, the Arab League imposes them individually and some states have been reticent in applying them.
Iraq and Lebanon, neighbors of Syria which have sensitive sectarian, strategic and trade relationships with Damascus, have declined to join the League’s sanctions campaign and will not attend the Paris meeting. Jordan is also concerned sanctions will hurt its economy and participants will discuss how Syria’s neighbors can be helped financially.