Posted by Joshua on Saturday, August 20th, 2011
Syria economy: Sanctions loom
2011-08-19, Aug. 19 (Economist Intelligence Unit) —
The US administration has taken the lead in imposing trade sanctions on Syria, with the explicit aim of hastening the demise of the Assad regime. Owing to the limited size of US-Syrian trade, these measures on their own will have little direct impact. However, they could pave the way for similar measures from the EU and, conceivably, from the UN Security Council.
The regime would still have the resources to survive, but would face a growing risk of being brought down by interest groups within Syria that are unwilling to continue to tie their fortunes to those of the Assad family. The US president, Barack Obama, declared on August 18th that the time has come for the Syrian president to step aside. As part of the efforts being made by the international community to support the aspirations of the Syrian people for democratic government and an end to repression, Mr Obama said that he had approved measures to deepen the regime’s financial isolation. They include barring US persons from having any transactions with the Syrian government a ban on US imports of Syrian crude oil or petroleum products and outlawing any dealings by US individuals or companies with the Syrian oil sector. All US investment in Syria will be prohibited.
The US sanctions are largely symbolic, but no less significant for all that. According to the most recent Syrian official trade figures, the US exported goods worth US$46m to Syria in 2009 (0.3% of Syria’s total imports) and purchased Syrian goods worth US$22m (0.2% of the total). US companies are not heavily involved in Syria. In the oil sector, Gulfsands Petroleum, founded in Houston, is a significant player, but it shifted its corporate base to the UK three years ago. The only other US-connected player in Syria is IPR, which, in partnership with ONGC of India started production from its Rashid field last year.
The US sanctions may have more of any impact on Canadian firms, which have more substantial investments in Syria, particularly if the Canadian government follows Mr Obama’s lead. Suncor (by virtue of its merger with Petro-Canada in 2009) has a stake in the Ebla Petroleum Company, which produces about 900m cu metres/year of natural gas from fields originally discovered in central Syria by Marathon of the US (in the early 1980s). These fields have started up relatively recently, in 2010, and Suncor clearly has a major concern to recoup its estimated US$1.2bn investment. The natural gas is entirely consumed within Syria. Suncor also has exploration blocks in Syria. A Suncor official said that the company is not violating any sanctions at present, but that the situation was under review. Another Canada-based firm, Tanganyika Petroleum, also produces oil from the Oudeh field, but has been owned by China’s Sinopec since 2008.
Syria currently produces 387,000 barrels/day of crude oil, according to the oil ministry. Just over 50% is produced by the state-owned Syrian Petroleum Company (SPC), with the remainder coming from nine joint-venture firms in which SPC has 50% stakes. The largest producer among these is Al-Furat Petroleum Company, with output of about 90,000 b/d; its foreign partners are Shell, ONGC and China national Petroleum Corporation (CNPC). CNPC has a separate joint venture (Kawkab) with CNPC; the other foreign players include Tatneft of Russia, Total of France, INA Naftaplin of Croatia, IPR, Suncor and Gulfsands (with Sinochem as an equity partner).
Syria exports about 145,000 b/d of crude via its state oil marketing firm, Sytrol. Most of these sales are of heavy crude produced by SPC, and their main destinations are refineries in Germany, Italy and France. In 2009 Syria’s oil exports totalled US$2.8bn (just over one-quarter of total exports); exports to the three European countries totalled US$2.2bn. The remainder of Syria’s oil production is processed in the Homs and Banias refineries to produce fuel oil, diesel and gasoline. According to the official trade statistics, Syria in 2009 was self-sufficient in fuel oil and diesel (both of which are subsidised), but imported gasoline worth US$1.5bn, although it also exported US$712m worth of gasoline.
The IMF has a slightly different picture, putting total oil and petroleum product exports at US$3.5bn petroleum imports at US$3.3bn. The overall oil balance of payments was negative, according to the IMF, owing to the US$1.2bn paid in 2009 to oil companies as royalties. If the EU were to impose an embargo on purchases of Syrian crude, the government would probably be able to find buyers in Asia, albeit at a discount. It would also have options to secure alternative supplies of gasoline, should the EU impose a ban on sales of petroleum products to Syria. Gasoline imports totalled 3.6m tonnes in 2009, a relatively modest amount, which could be secured from Russia or Iran (which is now a net exporter, having cut consumption through scrapping subsidies and boosted refinery output).
The bulk of Syria’s imports come from countries that do not appear to be inclined to impose sanctions: the top four suppliers are Ukraine, China, Turkey and Russia, of which only Turkey is showing any real interest in pressurising the Assad regime. Syria’s largest export market by far is Iraq, which seems happy to maintain cordial relations with Mr Assad.
Syria: main trade categories; 2009 US$m Imports Exports
Food, beverages and tobacco 2,822 2,550
Crude oil 0 2,850
Gasoline 1,496 712
Plastics 832 320
Pharmaceuticals 175 240
Manufactured goods 4,399 1,180
Machinery and vehicles 2,562 392
Total 15,359 10,502
Source: Central Bureau of Statistics.
Syria, main trading partners; 2009
Ukraine 1,618 Iraq 2,703
China 1,303 Germany 945
Turkey 1,167 France 670
Russia 912 Italy 585
Egypt 860 Saudi Arabia 583
South Korea 785 Egypt 360
Saudi Arabia 615 Lebanon 340
Italy 547 Spain 338
Germany 447 Turkey 312
France 223 UK 151
Source: Central Bureau of Statistics.
Ehsani on Sanctions:
As expected, the EU’s foreign policy committee has proposed adding 15 more Syrian officials and the five different Syrian oil companies to the existing sanctions lit. This would match the EU’s oil embargo to that announced by the U.S. yesterday. The formal vote will take place early next week.
What is critical is that the EU would broaden the definition of people covered by the sanctions from those “involved in the repression” to those “benefitting from the regime’s actions”. This is a much broader definition that the present time.
In addition to the ban on oil imports, technical assistance through the EIB will also be withdrawn.
In the past Europe was not in favor of restricting oil and gas exports for fear that energy shortages will place a heavy burden on the average Syrian citizen. This changed after the U.S. imposed its own sanctions on the sector. It is reported that the EU may soon add both the telecommunication as well as the banking industries to the list.
Incidentally, one recent source of refined petroleum imports to Syria has been the Ukraine. Early last year, a senior Syrian delegation led by Mohammed Hussein (ex Finance Minister) signed a free trade agreement with that country. It will be interesting to see how this relationship survives and prospers following the recent sanctions by the US and the EU.
Wisam Tarif on why the Syrian Opposition is so Divided
Activist: It’s Time For Syrian Opposition To Unify
by Kelly McEvers, NPR, August 19, 2011
President Obama has now called on Syrian President Bashar Assad to quit. But if he did, or if he is toppled, who would replace Assad?
There’s no clear answer. Assad and his late father, Hafez Assad, have ruled Syria for four decades and have not tolerated anything that resembles a genuine opposition inside the country’s borders.
“There is no opposition in Syria. There are opposition groups,” said Lebanon’s Wissam Tarif, who has been a prominent campaigner for democracy and human rights in the Middle East.
The problem, Tarif says, is that the emerging opposition groups are deeply divided, with no real plan of how the country would be run in a post-Assad era.
Tarif is currently in Beirut and has been documenting the deaths, injuries and detentions in Syria during Assad’s harsh crackdown on protesters over the past five months.
Tarif has been in touch with those leading the protests, and he used to work with anti-government groups inside Syria. Those groups made no real progress until the Arab Spring turned much of the region upside-down. And they still lack unity and direction.
By some counts, there are at least seven Syrian exile groups, each with its own leaders and its own ideas about how the country should go forward.
Then there’s the internal opposition, which has been criticized by some activists for being too close to the Assad regime.
And finally there are the young protesters who have taken to the streets. But Tarif says even they are divided and ill-equipped to provide real leadership.
“There’s millions of people taking to the streets, willing to die for freedom. And it’s a hell of a very difficult job. But it’s not enough,” he says, adding that the demonstrators “do not know how to do politics.”
Call For Unified Council
Tarif says all of these groups need to work together on a transitional council. It would be something of a shadow government, similar to what the rebels have created in Libya. However, that Libyan council has been filled with friction recently.
Still, Tarif says the important thing is to create a council and start working on how to get rid of Assad, maintain stability and run a new country.
“They have a lot of political differences, they have a lot of different political visions, and they have to overcome it,” he said.
Up to now, anti-government groups in Syria have preferred to remain decentralized. This made it more difficult for the Syrian security forces to track them down.
The Obama administration criticized the Assad regime for months, and on Thursday called for him to step down. Assad has given no indication that he’ll comply. But Tarif says it’s time for the opposition to step up, stop arguing and unify.
“Such leadership has to emerge. And it has to emerge yesterday. They don’t have time,” he says.
Syrian Opposition Names New 55 Person Transitional Parliament in Effort to Meet US Demands for a Unified Leadership. [It isn not clear how such a diverse body will be able to make decisions or hammer out decisions without an elected leader or two, but it is a beginning.
It is composed of 16 technocrats, 10 from the Antalya meeting, 7 from the Bruxselles meeting, 8 from the Salvation Meeting in Istanbul, 4 seculars, 12 Ulema, 8 youth, and an effort has been made to include members from all the religious communities.
الانتقالي الموحد والذي من المقرر بحسب مصادر سوريون نت أن يتشكل من خمسة وخمسين شخصية ستتوزع على الشكل التالي ستة عشر من التكنوقراط، وعشرة شخصيات من مؤتمر أنطاليا، وسبعة شخصيات من مؤتمر بروكسل،وثمانية شخصيات من مؤتمر الانقاذ، وأربعة شخصيات علمانية، واثنان من العلماء وثمانية من الشباب وبحسب الوثيقة التي حصل عليها سوريون نت فإن كل جهة من هذه الجهات ستفرز شخصا مثل يمثل النساء واليسار والعلمانية والدروز الاسماعيلية والعلوية وغيرها من الشرائح الطائفية والمجتمعية، وهو الذي سيقود العملية الانتقالية..
لكن سوريون علم أن بعض طوائف المعارضة السورية لم توافق على هذا بعد، ولا تزال المشاورات مستمرة، ويتوقع أن يتولى المجلس مهمة الانتقال بسورية في المرحلة الانتقالية المؤقتة إلى مرحلة الديمقراطية والتحول السلمي الديمقراطي، وبمثابة الحكومة الانتقالية ..
U.S. sanctions on Syrian gov’t not sufficient to bring down al-Assad
by Matthew Rusling
WASHINGTON, Aug. 18 (Xinhua) — The latest U.S. call for Syrian President Bashar al-Assad’s ouster and its new sanctions imposed on Damascus may not be sufficient to bring down Assad, U.S. experts said on Thursday.
Obama issued a new executive order that immediately froze all assets of the Syrian government under U.S. jurisdiction, and prohibited all U.S. citizens from engaging in any transactions involving the Syrian government.
It also “bans U.S. imports of Syrian-origin petroleum or petroleum products; prohibits U.S. persons from having any dealings in or related to Syria’s petroleum or petroleum products; and prohibits U.S. persons from operating or investing in Syria.”
Meanwhile, the U.S. Treasury announced that it barred trade with five Syrian oil and gas companies, including General Petroleum Corporation, Syrian Company For Oil Transport, Syrian Gas Company, Syrian Petroleum Company and Sytrol. Speaking on a White House conference call on Thursday, senior U.S. officials said the new sanctions, along with other measures the administration has taken against Assad, will “disrupt the Syrian regime’ s ability to finance its campaign of violence against the Syrian people.”
But there remains some questions as to whether the sanctions will have any impact at all, as the United States is no major importer of Syrian oil.
“The U.S. response alone probably will not have a substantial impact on the question of Assad stepping down,” said Wayne White, a scholar at the Middle East Institute who for decades served in various U.S. government positions in the Arab world.
David Pollock, senior fellow at the Washington Institute, echoed those thoughts.” The sanctions themselves are relatively minor,” he said. “But what’ s much more important is (U.S. President Barack Obama’s) very explicit statements that Assad should step aside.”
“So it’ s really this support (which is important for) the demonstrators in Syria, as well as other countries that are looking to see which way the wind is blowing,” he said.
U.S. Officials said they would continue to build on those actions as well as work with the international community to force Assad to step down, while insisting that the U.S. would not intervene in the domestic affairs of Syria.
Three leading European powers, Germany, Britain and France, have also called for the Syrian leader to step down, and U.S. State Department spokeswoman Victoria Nuland on Thursday said the Obama administration is now looking to more countries to take similar steps.
Markets prepared to handle Syrian oil loss, August 19, 2011
By David Sheppard, Ikuko Kurahone, Reuters
LONDON: Oil markets will quietly swallow the loss of Syrian supplies if Europe joins Washington in slapping new sanctions on the country, but prices would spike if Syria’s ally, and major oil producer Iran, becomes involved in a confrontation with the West.
Analysts and traders said it would take several weeks before the Syrian oil trade could grind to a halt, even if traders such as Vitol or Trafigura are forced to stop sending refined products for President Bashar Assad’s government and companies such as Shell are forced to stop producing and exporting oil from Syria…..
Russia opposed to call for Syria’s Assad to step down
Aug 19, 2011 13:47 Moscow Time
Russia does not see eye-to-eye with the United States and the European Union on their call for the Syrian President Bashar Assad to step down.
Moscow believes that Assad should be given time to carry out the reforms that Damascus has recently spoken of.
According to the Russian Foreign Ministry, Syria has already made impressive progress to that end. – Relevant laws have been adopted, an amnesty has been declared for political prisoners, and Syria said it was prepared to hold general elections by the end of the year and receive an international humanitarian mission.
But the main thing is Bashar Assad’s statement that all military operations against the opposition have been brought to a halt.
The Russian Foreign Ministry feels that Syria’s problems can be settled only through dialogue between the government and the opposition.
Suncor weighs effects of Syria sanctions, Market can absorb loss of oil supply, By David Sheppard and Ikuko Kurahone, Reuters
EGYPT: Liberals approve cleric’s suggestion for new constitution
August 18, 2011 | 11:20 am
A document drafted by the leading cleric at Al Azhar institution, the highest seat of learning in the Sunni Muslim world, to guide the writing of a new constitution for a “modern democratic state” has been widely endorsed by Egypt’s liberal and secular politicians.
The consensus was announced during a meeting that was held under the auspices of Azhar’s top cleric Ahmed el Tayeb on Wednesday and attended by nine potential presidential candidates, representatives of 22 political parties and a number of intellectuals and religious leaders.
“Those who attended the meeting at Al Azhar, agreed that Azhar’s document is a general guiding frame for the constitutional committee,” said presidential candidate Mohamed ElBaradei. Presidential aspirant Ayman Nour described the document as seeking to unite “political forces over the values and principles of a modern democratic and constitutional state.”
Initially brought to light by Tayeb in June, the document consists of 11 principles, proposing that Egypt has an Islamic identity but is committed to a “civil and democratic state governed by law and the constitution.” The principles include articles calling for respect of freedom of opinion, faith and for human rights.
Azhar’s document comes in the middle of a fierce split between Islamists and liberals over the introduction of supra-constitutional principles that would be binding on the new parliament in its writing of a constitution after November elections. Islamists, led by the Muslim Brotherhood’s Justice and Freedom party, are expected to win a sizable percent of Parliament, raising fears among liberals that without guiding principles the constitution would lean heavily toward a religious state.
Tayeb said that the Azhar’s draft, which is more moderate that many Islamists would support, is a code of honor that all parties should commit to voluntarily: “Some people view the [draft] as an attempt to undermine parliament’s freedom in writing the new constitution,” said Tayeb. “But the need for us to overcome our differences and reach common ground on this constitution can’t be more urgent.”
The Brotherhood’s Freedom and Justice representative, Mohamed Morsi, said that no one disagreed over the content or the meanings of the Azhar document. But a more extreme sect of Islamists, Salafis, have previously rejected the idea of any constitutional suggestions or recommendations before electing the new parliament.
An Azhar spokesman has said that the Ministries’ Cabinet and the ruling Supreme Council of Armed Forces, which previously expressed willingness to adopt constitutional principles if agreed on by all national powers, have received drafts of the document. –Amro Hassan in Cairo
LONDON (Reuters) – British oil firm Gulfsands Petroleum could face difficulties with future projects if the European Union follows the United States in toughening sanctions against Syria.
Hariri Tribunal Broadens Probe to 3 Other Attacks
2011-08-19 14:40:15.736 GMT
By MIKE CORDER
Leidschendam, Netherlands (AP) — The U.N.-backed court investigating the 2005 assassination of former Lebanese Prime Minister Rafik Hariri has widened its probe to cover three
other attacks they believe could be linked, the court announced Friday. The Special Tribunal for Lebanon said it has established jurisdiction over the June 2005 assassination of anti-Syria politician George Hawi. It also will investigate unsuccessful attempts to kill Deputy Prime Minister and Defense Minister Elias Murr a month later and lawmaker Marwan Hamadeh in October 2004. The court released few details of the decisions to widen the scope of its investigation, saying it did not want to compromise its work. It did not release details on why prosecutors believe the
three other attacks may be related to Hariri’s assassination.
The expansion of the case, however, represents a
significant escalation in the work of the court that has so far
focussed solely on the Feb. 14, 2005, suicide bombing that