Tuesday, July 29, 2014

How ISIS is exploiting the economics of Syria's civil war

A soldier at a checkpoint in Kurdish-controlled Iraq SAFIN HAMED/AFP/Getty Images

So many factors contributed to the catastrophe that is ISIS — the Sunni extremist group that has seized swathes of first Syria and now Iraq — that it can be difficult to hold them all together at once.

There was the political failure of Iraqi Prime Minister Nouri al-Maliki's government that left the state weak in the Sunni north. The Iraqi-demanded American withdrawal that left the country without a sufficiently viable military. The Iraqi Baathist elements urging along ISIS in Iraq. The Gulf states that funded extremist groups in Syria that have since metastasized out of control. The extremism itself and its own complex roots. And of course the Syrian civil war that has been ISIS's recruitment center and staging ground.

But there may be another major factor here: the economics of Syria's civil war, which ISIS appears to have actively and adroitly exploited in ways that have helped along its rise. The New York Times' Thanassis Cambanis profiled ISIS's surprisingly cunning economic strategy; I've added emphasis to one of the most stunning facts about this terrorist group:

But the group is not only following a stone-age script. It also rapidly establishes control of local resources and uses them to extend and strengthen its grip.

It has taken over oil fields in eastern Syria, for example, and according to several rebel commanders and aid workers, has resumed pumping. It has also secured revenue by selling electricity to the government from captured power plants. In Iraq on Wednesday, the militants seized control of Baiji, the site of Iraq's largest oil refinery and power plant.

Soak that in: a terrorist group that actively seeks the Syrian government's destruction, and is so extreme that al-Qaeda rejected it, has become so powerful that the Syrian government has to buy electricity from them.

There is reason to be skeptical that ISIS can really re-start eastern Syria or northern Iraq's oil fields, much less move and sell the oil, but the fact that the group has this ambition at all is telling. As the chaos of Syria's war breaks apart the state and its ability to function economically, ISIS is moving in to replace the state and its tax collectors, then using that revenue to launch its invasion of northern Iraq, which just so happens to be rich in oil itself.

There's more. ISIS, Cambanis reports, takes a cut of humanitarian and commercial operations in areas under its control. It confiscates money and property from Christians and from Muslims it doesn't like.

This money goes a long way: it pays better salaries than moderate Syrian rebels or the Syrian and Iraqi professional militaries, both of which have suffered mass desertions. ISIS also appears to enjoy better internal cohesion than any of its state or non-state enemies, at least for the moment. It rules over an area the size of Belgium.

Aaron Zelin, an analyst at the Washington Institute for Near East Policy, found this 2006 map produced by ISIS, showing the areas it hoped to control and overlapping oil sources. The correctness of the map aside, it shows that the group has been thinking about the economics of its war and how to self-fund:

Again, there is much more to ISIS and its rise than economics. But at some point armed movements, especially ones that seek to control country-sized stretches of territory, require a self-sustaining cash-flow to function. That ISIS appears to have been so successful at this says a lot about their strategic foresight, their long-term ambitions, and their ability to outlast their opponents.

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