“The question of where the Islamic State [IS] acquires its funding has been a subject of much discussion. Though ideological partisans often see a private Gulf Arab funding hand behind IS, the general consensus now seems to accept that IS is not dependent on foreign donors in any meaningful way, and thus largely acquires its revenues from resources within the territories it operates, including taxation, sales of oil and gas, antiquities and the like. Thus, the majority of the debate now focuses on trying to determine the relative importance of each of these sources of revenue,” writes Aymenn Jawad Al-Tamimi.
To advance that debate, there are now some hard numbers and they come from ISIS’s own financial ministry in Deir az-Zor province (eastern Syria), confirming that the bulk of ISIS’s funding is generated from within the territory it controls. The analyst makes these observations:
– Popular conceptions of IS income need to have a more sober and realistic perspective on the role oil and gas revenues. Daily revenues from the oil wells here (total divided by 30) yield on average $66,433. If this is the average revenue from IS’ best oil holdings in Syria and one engages in reasonable extrapolation, then one will come nowhere near the total figure of $3 million a day for IS in oil sales that was widely touted in the media in summer 2014, even when making allowances for subsequent damage to infrastructure from coalition airstrikes. A sounder estimate would put such income at no more than 5-10% of that figure.
– On a related historical note, one should dismiss accounts that portray IS’ predecessors as being suddenly enriched from eastern Syrian oilfields and antiquities beginning in late 2012, based on hearsay about alleged computer flash sticks revealing IS finances and off-base regarding the dynamics of control of eastern Syrian oil over the course of the Syrian civil war (pace the Guardian report, IS’ predecessor ISIS did not exist in late 2012, let alone ‘commandeer’ eastern Syrian oilfields).
– The sale of antiquities under the authority of the antiquities subdivision of the Diwan al-Rikaz is not explicitly mentioned in the accounts here, but it is most likely included within taxation as part of the IS bureaucratic structure. Documents captured from the Abu Sayyaf raid by U.S. forces appear to show a 20% tax to be paid on antiquities sold in Deir az-Zor province. Two of the individual transactions presented from December 2014 illustrate tax payments of more than $10,000, while the third constitutes a little over $1000.
– Despite IS’ propaganda on ‘breaking the borders’ and the creation of ‘Euphrates Province’, the inclusion of Albukamal within Deir az-Zor province financial data and transactions is an example of how IS still deals in prior administrative boundaries. Compare with a previous July 2015 document I published from Wilayat al-Kheir’s Diwan al-Khidamat ordering for an Abu Dujana al-Libi to be paid $100,000 for a road project between Albukamal and al-Qa’im. Other administrative documents from ‘Euphrates Province’ indicate that IS administration rarely seems to deal with the territory as a united entity, but rather by its Syrian and Iraqi halves. This is so even as travel within ‘Euphrates Province’ is relatively easy, as a friend of mine from Rawa now works in Albukamal, and residents on both sides of the Iraq-Syria border regularly cross both ways for business, market shopping etc.
– Ultimately, the most vital IS revenues depend on the continued existence of its bureaucratic structure within the territories it controls, and there is little one can do to disrupt that short of destroying that structure militarily. The suggested siege-like strategy to trigger a collapse from within is impossible to realize in the current circumstances, as one cannot wholly isolate IS territory from interactions with the outside world, and so cash flows will continue. The Iraqi government’s decision to cut off direct salary payments to workers in IS-held areas will certainly help reduce IS taxation revenues, but it was not the sole avenue for cash flow, and though hardships for residents will increase, IS’ rigid security apparatus is still highly capable of suppressing major revolt.