Syrian Economy; Israel – US Clash

on the Clash between Israeli and US Interests – This is pretty dramatic. Thanks to “Pulse”

Fox News: Syria’s Economy

Damascus is abuzz with activity, from international investors carrying out due diligence on business opportunities and infrastructure projects, to diplomats passing through to see if Syria can’t help unblock the peace process. Syria remains on the …

Syria’s Banking Sector Grew by 14 Percent in 2009
Syria Report

Syria’s commercial banks held total assets of SYP 1.96 trillion at the end of 2009, a year-on-year increase of 14.4 percent, according to data from the Central Bank of Syria. Read

Syria: Public Investment Planned
17 March 2010

Details from the draft stages of Syria’s forthcoming 11th Five-Year Plan suggest that the government intends to place a renewed emphasis on public investment in the coming years.

Speaking to official Syrian news agency SANA towards the end of last month, the deputy prime minister, Abdullah Al Dardari, said the new plan would focus on investment in infrastructure and energy security. “We have signed several contracts worth $5bn to produce 5000 MW of electric power by the end of 2013, increasing the generation of electric power in Syria during the next five years by 70%,” Al Dardari said.

Earlier reports state that the new plan is expected to be ready by next March, and will set ambitious targets of 8% annual GDP growth, and a reduction in unemployment to 4%. By comparison, recent growth levels before the global crisis were averaging between 5% and 6%, while unofficial estimates for unemployment are between 10% and 12%. his profile.

The Syrian government appears keen to extend the public-private partnership model (PPP) to other areas of infrastructure investment, with the government sponsoring the country’s first PPP conference last October in Damascus, where Al Dardari told potential investors that Syria would require in the order of $50bn of infrastructure investment over the next five years.

The Syrian government has been working alongside the World Bank’s International Finance Corporation for the past few months in preparation for the country’s first independent power project (IPP) – a 250 to 350-MW plant to be located 60 km north of the capital, Damascus, on a 20 to 25-year build-operate-transfer concession. According to regional press, two bids for the power plant have been shortlisted since September 2009: one led by Marafeq, a joint venture of locally based Cham Holding including participation from several Kuwaiti firms, and the other a joint venture between Finland’s Wartsila and Greece’s Terna Energy.

As it currently stands, Syria lacks a domestic legal framework for PPP contracts. However, recent changes to banking regulations requiring private banks to up their minimum capital from $33m to $220m seem designed to improve the nascent sector’s capacity to fund large-scale infrastructure projects. The first such project to be run by Syria’s domestic private banking sector saw a $340m syndicated loan, involving 16 local and international financing partners, made available to French cement producer Lafarge for the construction of its new Syrian plant late last year.

The book-runner on that loan was Bank Audi Syria, whose deputy chairman and general manager, Bassel Hamwi, recently told local press that hurdles remained in the movement toward PPPs. Noting that the key concern for business was return on investment, Hamwi described the speed at which the government moves ahead in structuring and implementing projects as “crucial”. “The worst thing that could happen is for investors to put in the funds and their return on equity plummets,” he said.

The issue is indeed a genuine concern for the banking sector: currently 10% of bank capital must be deposited at the Central Bank, where in the absence of a treasury bill market or certificate of deposit system it currently earns no interest. As a result, banks must work their remaining capital especially hard to ensure a return on equity for investors. While PPPs would offer a potentially rewarding return on investment for that capital, the government must first build confidence in the sector, ensuring that such contracts proceed smoothly.

Gulfsands Jumps 21 Percent in London Trading After Approach
By Brian Swint

March 18 (Bloomberg) — Gulfsands Petroleum Plc, a U.K. oil and gas explorer with operations in the Middle East and the U.S., surged to a record in London trading after receiving a takeover approach.

Gulfsands jumped as much as 21 percent to 313 pence, the highest intraday price since the shares were first sold to the public in April 2005. The stock gained 5.3 percent yesterday.

“The board of directors of Gulfsands Petroleum notes the recent movement in the company’s share price and confirms that it has received a preliminary approach that may or may not lead to an offer for Gulfsands,” the London-based company said in a statement. It didn’t identify the potential buyer.

Gulfsands reported a first-half profit in September after a jump in production at its Khurbet East Field in Syria. It won approval to develop another field in the country in January.

Gulfsands in September denied that it was in talks with China’s Sinochem Corp. about a takeover. Sinochem, China’s biggest chemicals trader, announced a 532 million pound ($811 million) bid for Emerald Energy Plc in August. Emerald and Gulfsands each hold a 50 percent stake in the Khurbet East oil field.

Syria: timing of accord depends on EU ‘flexibility’

DAMASCUS — Syria said on Tuesday it will soon restart talks with the European Union on a stalled partnership agreement, but that its timing will depend on the flexibility shown to Damascus over certain points.

“A European delegation will travel to Damascus to negotiate the points in the agreement that raise Syrian concern,” Foreign Minister Walid Muallem said at a news conference with visiting EU foreign policy chief Catherine Ashton.

“The date for signing the agreement will depend on the two parties, and on the degree of flexibility shown during the forthcoming negotiations,” he added, without elaborating on points of concern to Damascus.

The association agreement had been due to be signed last October, but was deferred after President Bashar al-Assad said Syria wanted “to revise” certain clauses.

At the time The Netherlands insisted on including a separate document from its EU partners linking the agreement to Syrian respect for human rights.

Muallem said that both sides “share the same points of view. They want an agreement based on equality, respect for sovereignty and independence, and non-interference in internal affairs.”

Wahab’s attack is part of Syria’s campaign against the president
March 18, 2010, Ya Lubnan

Wiam Wahab’s call for the resignation of the president was obviously not a personal opinion as he stated during his visit to MP Michel Aoun at Rabiyeh, but was reportedly part of a campaign against President Michel Suleiman orchestrated by Syria’s allies in Lebanon according to local observers.

Former minister Wahab a staunch ally of Syria on Wednesday attacked President Michel Suleiman and called on him to resign for allegedly failing to govern the country.

According to An-Nahar newspaper sources, the campaign against Suleiman and several government institutions is organized by a number of political allies of Syria who intend to form a new “radical” group that aims to “impose fresh conditions” on Lebanon’s pro-government leaders in light of regional developments that would help Damascus once again, to hold the upper hand over Lebanon.

The campaign has reportedly begun with Suleiman’s visit to the U.S. It intensified when the President announced the establishment of a National Dialogue Committee and called for the resumption of all-party talks to discuss the defense strategy.

Syria’s allies are reportedly targeting the following issues:

  • The timing of the dialogue talks which came right after the summit in Syria between the Iranian President Mahmoud Ahmadinejad , Syrian president Bashar al Assad and Hezbollah chief Sayyed Hassan Nasrallah
  • The deletion of the word “resistance” from a clause in the final statement, following the dialogue talks.
  • The so-called “security agreement” with the United States.
  • April 2009 US Embassy request for information on Lebanon’s telecommunications grid…..

“Israel is empowering al Qaeda, Petraeus warns” by Paul Woodward

David Schenker – Linkage: Iran, Settlements, Health Care & Israel?
Steve Clemmons at Washington Note

Late yesterday afternoon, I participated in an hour long Alhurra discussion program with … David Schenker who directs the Program on Arab Politics at the Washington Institute for Near East Policy.

The topic was the state of play in US-Israel relations after Vice President Biden’s visit and Israel’s alleged “insult” during his trip with the announced approval of 1600 new settlements in East Jerusalem.

During one of my times at bat during the interesting show, I suggested that Israel’s continued settlement expansion was directly helping Iran and enhancing its pretensions and goals in the region. The Washington Institute’s David Schenker responded that he really didn’t see a linkage between the settlements and Iran’s position. He stated that Iran really wasn’t all that welcome throughout the broader Middle East today and that its nuclear activities were making other Arab states nervous.

In part, he is correct about Sunni Arab antipathy towards Iran but neglected to note that officially, all of the other major Arab states are as furious about Israel’s settlements creep as the Obama national security team. But that’s not the issue that most caught my attention in this exchange.

Schenker, who offered some interesting insights on the show, went on to assert that while he saw no linkage between Israel’s settlement expansion and a boost to Iran’s regional posture, he suggested there was a linkage between US-Israel relations and getting Obama’s health care reform passed.

What?? Play that again.

So, David Schenker sees no linkage between what a huge number of observers see as Israel wrecking chances for a credible two state track — and the use of this grievance by Iran in its support of transnational Arab networks in the region, but nonetheless sees linkage between President Obama’s fragile health care reform position and the state of US-Israel relations?! Schenker’s view was that Obama couldn’t afford to have a testy, strained relationship with Israel because it would cost him support in Congress for his health care legislation.

If he is right, then the relationship with Israel has gone too far indeed.

The truth is that I believe that Schenker is wrong on both counts.

There is a linkage between Iran’s ability to compete for the position as true defender of the Islamic faith and the controversial settlements, and on the other front, there must not be a connection between the fragile coalition Obama is building to try and achieve health care reform and the state of the US-Israel relationship.

Any US Congressperson or Senator who actually explicitly withdrew or withheld support for health care reform because of loyalty first to Israel and its needs would invite serious questions about his or her patriotism and oath to the US Constitution and American people.

I support Israel’s right to exist, see it as an important ally, and believe that we should support its security — but not at the continued expense of Arab interests in the region and certainly not at the expense of core American interests at home. The interests of Arab states and Israel must be balanced and mutually pursued. Not to do so is a false choice for the U.S., but even worse would be the practice of punishing American taxpayers and their pursuit of key social reforms in favor of Israel’s interests.

I enjoyed the exchange with David Schenker and others — but whereas David has every right to assert that he does not see a linkage between settlements and Iran’s interests (though I disagree), I think that his second assertion that Obama might lose the health care battle by not keeping the Israel-tilting Members of Congress was hopefully wrong-footed.

If he’s accurate, then it’s time for political change in Congress again — but this time with a different filter.

Check out just-concluded two day conference in Damascus of leading Sunni clerics from Syria and Shia clerics from Iran. Intended as a direct reply to those who claim that there can be a new geopolitical order in the region, based on exploiting longterm Sunni v Shia conflict, and even aligning Sunni Arabs with Israel against “greater threat” to the regional security from Iran. Over 1,000 attended the two day event.

The Gulf in the Persian Gulf
While Israel fears a nuclear Iran, Saudi Arabia is more concerned with resolving the Palestinian problem
By Judith Miller, March 18, 2010

Israel, understandably, is fixated on what most of its leaders consider an existential threat: Iran’s attempt to acquire a nuclear bomb.

Saudi Arabia, too, is concerned about Iran’s growing influence in the Arab Middle East and the possibility that it will soon have nuclear weapons.

But the two nations are talking past each other yet again.

For the Saudis, concern about Iran’s nuclear ambitions, which Riyadh sees as a longer-term threat, has taken a back seat to its concern about the lack of perceived progress in solving the Israel-Palestinian struggle.

Riyadh’s growing unease about the effect of this protracted conflict on the kingdom and on Iran’s hegemonic ambitions was conveyed to Adm. Michael G. Mullen, chairman of the Joint Chiefs of Staff, in meetings in the region last month with senior Saudi and other Arab officials, according to a senior U.S. military official.

Initially, the kingdom’s concern about the plight of the Palestinians was mostly lip service. While Saudi Arabia and other Arab oil states bankrolled the Palestine Liberation Organization and rhetorically endorsed the Palestinians’ right to a state of their own and a theoretical return to the lands of Palestine, Jerusalem in particular, the lack of a settlement and the perpetuation of the status quo following the 1973 Arab-Israeli war jeopardized neither vital Saudi nor Arab interests.

Today, however, concern about the rise of militant Palestinian Hamas, Palestinian political disarray and the growing political despair of Palestinians under Israeli occupation — if not those in the refugee camps of Jordan, Syria and Lebanon — seems widespread within the kingdom, for practical, self-serving reasons. The Saudi government has come to see the festering wound of Palestine as a primary source of the radicalization of its own population and, hence, of the extremism that threatens the kingdom’s stability and plays directly into Iranian hands.

Because Saudi Arabia is overwhelmingly young — more than 75% of Saudis are under 30 — most of the country’s citizens have no memory of a time when an Arab-Israeli peace seemed not only possible but likely. The 1991 Madrid peace conference, the 1993 Oslo accords, the Arab-Israeli handshakes on the White House lawn — all are now ancient history. Instead, Saudis, and young Saudis in particular, see Israelis not as potential partners in peace but as brutal occupiers.

The Arab media and the exponential growth of the Internet have reinforced among Saudis a sense of humiliation, injustice and outrage over Israel’s incursions into Lebanon and the Gaza Strip. Al Jazeera and the thousands of websites that Saudis avidly monitor have brought the once-distant suffering of Palestinians directly into their living rooms, giving their plight an immediacy and resonance it once lacked.

Everyone I talked to on a recent trip to Riyadh — from princes to merchants to bloggers — mentioned the Palestinian cause, rather than Iran, as their top foreign policy concern (an impression supported by recent opinion polls). Saudi royals and government officials know well that Al Qaeda and other “jihadi” groups exploited the Palestinian cause not only to help recruit the Saudi “muscle” for the 9/11 attacks — 15 of the 19 hijackers were Saudis — but also for subsequent attacks on the kingdom itself.

Between 2003 and 2006, this most rigid, fundamentalist of Muslim regimes was forced to battle its own homegrown Islamic extremists — confrontations that profoundly shook the kingdom. Last year, a homegrown extremist nearly killed Prince Mohammed bin Nayif, the deputy interior minister, in a suicide-bomb attack.

Brig. Gen. Mansour Turki, spokesman for the Interior Ministry, which runs a well-regarded de-radicalization program, called the “humiliation” of Palestinians under Israeli occupation a “major factor” in the radicalization of Saudis and asserted that Israel’s war in Gaza helped prompt some of the former Saudi detainees held at Guantanamo Bay who had graduated from the kingdom’s de-radicalization program to return to Al Qaeda- related activities. ……

The law has teeth: building on judicial decisions
Momentum should be built up toward outlawing Israel’s policy in major parts of the world
By Chibli Mallat – Daily Star – Thursday, March 18, 2010

….European judges ruled that goods manufactured in Israeli settlements in the West Bank were not “made in Israel.” This is more significant than the tons of paper devoted to condemnation of Israeli policy in sundry diplomatic places, including recently by the EU new High Representative for Foreign Affairs and Security Policy of the European Union, Catherine Ashton. The law has teeth, which all political declarations in the world lack. Israel may not go bankrupt because preferential trade has been denied to a small portion of its manufacturing industries, but the message of Israel’s boundaries stopping at the line of 1967 is powerful one.

Coming together with the Goldstone Report and the increasing fear by Israeli high officials and military officers of travelling to Europe lest they get arrested, the judicial momentum should be built up toward outlawing Israeli governmental policy in major parts of the world…..

UC Berkeley students ask for Israel divestment
By Matt Krupnick
Contra Costa Times, 03/18/2010

BERKELEY — UC Berkeley student leaders voted early Thursday to drop the student Senate’s investments in companies doing business with Israel.

The Senate, meeting into the early hours of the morning, voted 16-4 to divest itself from Israel and to ask the University of California system to do the same.

It was not immediately known whether the Senate had any such investments. But the UC system invests millions in funds that include General Electric and United Technologies, which supply Israel with military equipment, said Emiliano Huet-Vaughn, a student senator who cowrote the bill.

The UC system, he said, should not support a country that has committed human-rights abuses in the Gaza Strip. The 10-campus university has divested itself of tobacco- and Sudan-related funds.

The students’ action was condemned by the Los Angeles-based Simon Wiesenthal Center, which called the vote hypocritical and troubling, citing violence by Palestinians. A UC spokesman said the university had not yet seen the resolution and could not comment.

Elliot Abrams and local neoconservatives to Israeli public: Obama intends to topple Netanyahu
March 18, 2010

BSO [Hebrew]: Blame for creating the crisis is all the Obama administration’s, says Abrams. Obama had no real reason to create it. Therefore if this crisis continues, it will be a strategic mistake that harms the US-Israel relationship. We asked Abrams why he thinks Obama decided to create this crisis, and here is his very surprising answer:

Elliott Abrams [English]: The administration was very hostile to the Netanyahu government. They were hostile before he did anything. So what argument you can make is that they really don’t like dealing with the Netanyahu government and that they want to see if they can get rid of it and bring down the coalition.

U.S. Army Says Israeli Colonies Threaten American Security
William Pfaff on 2010/3/17

Paris, March 16, 2010 – The relationship between the United States and Israel has always rested on a number of pretenses, politically useful to politicians on both sides, but because they are untrue, certain eventually to prove destructive to both countries.

The destruction has now begun….

Comments (12)

Elie Elhadj said:

On the subject of the economy, banking, and investment a question comes to mind:

Where are Syria’s revenues from crude oil classified in the national budget? How much have they been, say, over the past five years? How much and where are the export proceeds from crude oil classified in Syria’s balance of payments?


March 19th, 2010, 8:21 am


Amir in Tel Aviv said:

Suggesting that there’s a linkage between the Jerusalem quarrel and the health care issue, is again forcing the Jews into the old trap of infamous prejudices. That Jews aren’t loyal, that they have hidden agendas, that they are caballing, that they are not to be trusted.

As for the health care issue, I very much hope it passes in the houses.
It’s about time that America repairs this injustice. It’s a great shame. One of the best health systems in the world, and so many Americans are denied this basic right for decent health, state funded service.

March 19th, 2010, 12:57 pm


Akbar Palace said:

Keep the Socialism

As for the health care issue, I very much hope it passes in the houses.


I hope it doesn’t. It is way too expensive and way too intrusive into our lives. A large percent of the uninsured don’t want insurance, another large percent of them don’t even bother to apply.

All we have to do is expand the current system to include those who have yet to apply, increase competition, apply tort reform, and cut down on fraud.

March 19th, 2010, 2:01 pm


Off the Wall said:

The suggestion is being made by Israel first neocons not by their opponents. Israel firsters are not only damaging Israel in their collusion with the fanatics in Israel, but also in their brazen open threats.

Take for example someone saying elect me, I am good for Israel in a retirement house in Florida, I find that insulting it means that the good of the US has no intrinsic value to these retirees and invites dual loyalty accusations.

There is nothing wrong with attachment to Israel, what is wrong is for someone to put the interest of a fanatic group in another country before their own.

Polls indicate 67% support for Israel, but surfing the web lately, I am beginning to suspect a great deal of self censorship in many responses. As some influential people start talking, others will follow. This crisis may be brushed under the rug, but the bulge in the rug will only get bigger and bigger and more noticeable. Questioning whether US and Israel Interests coincide is the biggest threat Israel may face in the near future. I have argued that there are shared values (good and bad) between the two countries, but shared interest is a different matter. Questions are being asked, and the reaction of Israel proponents in the US has been anything but more intimidation and arrogant show of power. But intimidation has limits.

An arabic proverb says “if your friend is a honey jar, don’t lick it all”. AIPAC seems intent not only on licking all the honey, but on threatening to break the jar. And for what, not for you in tel-aviv, but for a bunch or fanatic settlers, who are bringing your nation closer and closer to being a theocracy. Sit back and enjoy the show, and when, with help of AIPAC and its sisters here in the US, the settlers and fanatics enjoy the upper hand in your country, I hope you will be ready for mandatory prayers and rabbinical visits to check how kosher has your life been. The more you approve of the occupation, the more you argue that you have rights to an inch of the west bank and east joursalem-alquds, the sooner you are inviting these visits.

March 19th, 2010, 4:02 pm


Ghat Albird said:

Amir said:

An arabic proverb says “if your friend is a honey jar, don’t lick it all”. AIPAC seems intent not only on licking all the honey, but on threatening to break the jar”.

Reminds one of:

An old polish proverb which says “the jew screams in pain as he is slapping your face”

March 19th, 2010, 5:40 pm


Off the Wall said:

It was me who cited the arabic proverb, but let me assure you and all, it was not meant to be in any shape or form to be similar to the anti-semetic polish proverb you cited. It is mostly about demanding high maintenance friends, The closest direct translation to English is perhaps closer to the one that says
Don’t push your luck.

March 19th, 2010, 5:50 pm


Ghat Albird said:


No offense intended and apologeez.

March 19th, 2010, 7:17 pm


Off the Wall said:

None taken, and no need for any apology 🙂

March 20th, 2010, 2:01 am


Husam said:

Syria’s Economy:

Do any of you sense the same feeling that Syria is on a sustainable economic up-swing in general? It looked that they had some progress with domestic issues, granted still a long way to go.

Something like 99.9% of homeowners are debt free. Real Estate there seems to never go down. People in urgent need to sell drive property values down, but this doesn’t happen in Syria at all. And since the interest rate has no bearing on housing market, stable increase in prices in the last 30 years has been the case.

No credit card debt whatsoever. Very young population with eagerness to better themselves. Schools/Universities are proping up more and more.

No wonder so many expats are returning.

March 25th, 2010, 1:06 am


norman said:

The reason that real estate in Syria does not go down is because Syrians park their money in real estate instead of investing , the reason for that is the lack of real estate tax in Syria , the lack of real estate taxes makes Syrians buy apartments which make it difficult for young people to own houses without family help , what Syria should do is to impose real estate tax as we have in the US at least after the first house , that will force owners to sell ot at least rent to collect and pay the taxes and that will improve the housing shortage ,

March 25th, 2010, 3:28 am


Mr.President said:

Housing prices in Syria do go down. it happened in the 80’s. it was related to the layoffs in the Gulf labor market. They also go down by not keeping up with inflation (housing prices stay the same for long duration of time). if a price of a house doubles, on average, every ten years it means a growth rate of about 7+ percent (compounded). that is not unusual knowing that Syria National Bank used to pay 9% interest on long term deposits. The real estate issue in Syria is very complicated. Increasing Real Estate taxes would not fix it. People would find a way around it ( for example re-registering their properties in the name of their kids, side sales,…) the issue is impacted by many factors such as:
Rigid inheritance law, cultural and social factors ( one needs a private dedicated useless guest room, a big kitchen,… ), the legal limitations of the rental market, inefficient purchase/sell/repair mechanism , large expat community securing retirement housing,…

March 25th, 2010, 7:39 am


Husam said:

I agree that taxes: property taxes, capital gains will effect the housing market in Syria to some degree if implemented. Yes, limitation of other investment vehicles does also effect it. Culture (secure a house for children, etc…) plays another role.

I believe the legal limitations to rent have been relaxed, if not radiated. Many do rent their property nowadays without fear.

You also have many new projects showing up for the first time in Syria like Eigth Gate (IGO & Amaar Joint Venture) which is at 50% completion and sold out.

The question: is it a sustainable move to purchase property at this level due to the political and economic dynamics taking place or will it be short lived?

March 25th, 2010, 9:09 pm


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