An increasingly isolated Syria imposed retaliatory sanctions on former friend Turkey, but said on Monday it might agree soon to an Arab peace plan to avert penalties from Arab states over its eight month crackdown on protests.
In a display of muscle that could be intended to deter any idea of foreign military intervention in a crisis which has killed at least 4,000 people, the army staged a big exercise with rockets, tanks and helicopters.
Top generals watched the war games on Sunday and Syrian state television made it their top news story.
Already hit by economic sanctions from the United States and Europe, Syria was punished last month by regional countries, with sanctions announced by the Arab League and imposed by Turkey, once President Bashar al-Assad's ally.
On Monday Syria responded to Turkey with retaliatory measures, imposing a tariff of 30 percent on its imports and prohibitive duties on fuel and freight. State news agency SANA quoted a pro-Assad economist as saying Turkey would be the biggest loser.
The Arab League sanctions have yet to take effect, with the League repeatedly extending deadlines for Damascus to agree to a peace plan that would see Arab monitors oversee its withdrawal of troops from towns. The latest deadline expired on Sunday.
Foreign Minister spokesman Jihad al-Makdesi said Damascus was still looking at the plan.
The protocol is intended to be signed soon, he said. The Syrian government has responded positively to the draft protocol ... I am optimistic, although I await the Arab League response first.
Syria says the Arab proposal to admit observers infringes its sovereignty, and has asked for clarification. It has stalled more than once and reneged on promises to rein in its forces.
SANA expressed regret mixed with defiance at the prospect of Arab sanctions.
The Arab League sanctions ... have been a shock for every Syrian and Arab citizen ... as these sanctions came from sisterly countries, it said. Syria will overcome those sanctions by virtue of its strategic location and the diversity of its production sectors, the state agency added.
Syria's Arab neighbours Iraq, Lebanon and Jordan have all said they would not join a sanctions campaign.
In a reminder to outsiders of Syria's powerful, mainly Russian-supplied armed forces, state TV and SANA showed top generals watching a live-fire exercise by missile units, mechanised brigades and aircraft, to test their capacity in confronting any attack on Syria.
It did not report the scale of the war games.
General (Dawood Abdullah) Rajiha stressed that the armed forces, under the leadership of President Bashar al-Assad will remain loyal to the homeland and will defend the interests of the Syrian people, SANA said. Rajiha is Minister of Defence.
Makdesi, the foreign ministry spokesman, said the war games were a routine exercise and not intended to send any message.
The first cracks appeared in one of the pillars of Assad's regime at the weekend with the desertion of some members of the secret police to the ranks of a rebel free army.
At least a dozen members of the secret police deserted from the Airforce Intelligence complex in Idlib city, 280 km (175 miles) northwest of Damascus, triggering a gunbattle with defectors in which 10 were killed or wounded on either side, activists said.
Opposition sources said a further 16 soldiers defected from units in Idlib on Sunday and a new group of defectors of similar size battled loyalist troops to the south, in the Josieh area on the border with Lebanon.
Assad's opponents estimate the strength of the rebel force at several thousand, mainly army recruits from Syria's Sunni Muslim majority. Members of Assad's minority Alawite sect, an offshoot of Shi'ite Islam, have a tight grip on the military and security apparatus.
The conscript armed forces have more than 200,000 men.
SOONER OR LATER
Burhan Ghalioun, head of the opposition Syrian National Council, said it was now a question of weeks before the regime collapses. But he offered no firm basis for his projection.
Maybe the regime will implode, or things will get more complicated, and it will take a very long time, he told Austria's Der Standard daily. I hope that everything will go a lot faster thanks to international pressure, sanctions, the continuation of peaceful protests, the exhaustion of the security forces and especially the mercenaries.
He said the Council had told Syrian Free Army leader Riad al-Assad that we believe it is not in the interest of Syria that this army becomes an army which fights against other military forces in the country. This could mean a civil war which is something that we want to avoid at all costs.
Government forces and militiamen loyal to Assad killed at least 30 civilians and five defectors on Sunday, mostly in Homs, Syria's third largest city, activists' reports said.
Syrian authorities say they are fighting foreign-backed terrorist groups trying to spark civil war, who have killed some 1,100 soldiers and police since March. SANA on Monday reported military funerals for a further seven killed.
The agency said a civilian father and his three children were killed by an armed terrorist gang that broke into their house. Opposition activists said the family were killed by militiamen loyal to Assad, in a drive-by shooting.
U.S. Assistant Secretary of State Jeffrey Feltman accused Assad of forcing his Alawite sect into a bloody conflict with the country's majority Sunnis, ...fulfilling his own prophecy that Syria is going to move into chaos and civil war.
(Additional reporting by Sylvia Westall in Vienna and Khaled Yacoub Oweis in Amman)
(Additional reporting by Suleiman al-Khalidi and Patrick Werr; Editing by Peter Graff)