Out of Syria’s ashes the speculators are reborn

Even as the country’s civil war winds down, Russian and Chinese developers jostle for crony contracts

So this is what liberation looks like: the piles of dusty, grey rubble; the twisted, empty chassis of cars; the crumbling shells of buildings; and not a single person to be seen. According to the Syrian Observatory for Human Rights (SOHR), 80 per cent of Raqqa, until recently the capital of Isil’s gruesome caliphate, has been destroyed. It used to be home to over 200,000 people, but recent media drone footage of the city just shows utter devastation.

In Lebanon, I met a family who used to live in Raqqa. The father, Brahim, was a taxi driver but fled Isil with his wife and seven children three years ago. Now, they live in a blue plastic tent at a camp run by the International Rescue Committee, and pay for basics with a UN food-stamp card. It’s not enough and they are deeply in debt. “I wish life would go back to how it was before,” he said.

It’s not just Raqqa, though. Before its civil war, Syria was home to about 21 million people. Since then, five million have fled the country as refugees and more than six million have been internally displaced. Footage of Aleppo, Homs, some parts of Damascus and Palmyra (not just the ancient ruins but the town proper) show neighbourhoods totally destroyed.

The war still isn’t over, but talk about reconstruction has already started. A few years ago, the talk in the West was of funding a “Marshall Plan for the Middle East” to rebuild, and help give millions of refugees a reason to stay, in the region. But that ship has sailed. Whoever rebuilds Syria, it won’t be the West.

The Syrian prime minister, Imad Khamis, has said lucrative contracts will go to “friendly and brotherly countries”. Two Russian companies have already been awarded licenses for resource extraction. At a recent trade fair focused on Syria, China announced that it is investing

$2 billion for reconstruction. Neighbouring Jordan hosted a “Syria Rebuild 2017” conference over the summer. In August, the Syrian government reopened the Damascus International Exhibition. Three days after opening, it was bombed, according to SOHR, though Syria’s state media reported nothing about it.

There is wealth flowing in and out of the country. When in Lebanon over the summer, we drove along the Syrian border on the way from one tourist site to another. Passing the turn-off to Damascus, half an hour away, we could see the road chock-a-block with cars. Our driver explained that many Damascus residents pop out to buy goods in Lebanon, where prices are lower.

It might seem strange, with bombs still falling, but there is big money to be made in Syria, and the people to make it will almost certain be those who are friendliest to Bashar al-assad. As Steven Heydemann, a fellow at the Brookings Institution points out, it was exactly these sorts of economic policies that triggered the civil war in the first place. Brahim the taxi driver might get his wish – but in the long term, that’s rather a bleak prospect for Syria.

Markets just keep setting new records. The S&P 500 has risen by 19 per cent in one year, the Dow by more than 27 per cent. The IMF is fretting, warning governments not to get complacent. Valuations are sky-high, companies are underinvesting and states and households have never been more indebted. Financial commentators are speculating whether a repeat of the 1987 Black Monday crash is imminent.

And yet. I covered financial markets for over five years and I learned that analysts can talk about “fundamentals” until they’re blue in the face and still see markets continue on their crazy way the next day. The problem is that, after years of quantitative easing, companies, pension funds and sovereign wealth funds are sitting on so much cash. They have to do something with it, so it floods into equities and bonds.

This is particularly crazy when you consider the huge deficit in infrastructure investment across the developed world. Britain needs massive upgrades to train lines, housing, airports, roads, power plants, ports and so on – all of which, when built, would provide just the sort of steady returns that pension funds need to match their liabilities. Instead, all the money is sitting in London property and pumping up stock market valuations across the world.

We can only pray that it won’t take a crash to prompt the reallocation of capital so sorely needed.

Good for Tim Loughton. The Tory MP was roundly mocked for revealing that he spends up to an hour soaking in the bath each morning, claiming that it provides much-needed thinking time. He was immediately panned for wasting vast amounts of time and water. But he’s quite right.

It’s easy to spend no time thinking at all nowadays, and instead to pass every moment plugged into constant chatter and news through one’s phone. The bath, at least, is one place where you can’t take it. I learnt that the hard way: by dropping my phone into the water. FOLLOW Juliet Samuel on Twitter @Citysamuel; READ MORE at telegraph.co.uk/opinion