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Books on Syria
REPUBLICAN REFERENCE
Area (sq.km)
185,180
Population
17,585,540
Capital
Damascus
Currency
Syrian pound (SYP)
President
Bashir al-Asad
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Update No: 013 - (30/11/04)
Does Syria Have the Upper Hand in the Middle
East Chess Game?
There is no doubt that Syria has been facing unprecedented pressure since
the United States invaded Iraq in 2003. The reforms that President Bashir Al-Asad
initiated at the beginning of his rule in 2000 were halted by the precarious
security situation along its border with Iraq and rising tensions with Israel.
Twice in 2004, Israel showed that it could attack Syria with impunity, while the
international community strengthened by a UN resolution has been pressuring
Syria to retreat from Lebanon. Syria is a protagonist in the Arab-Israeli
conflict and the government of Ariel Sharon in Israel has, for all practical
intent, reversed the Oslo accords, while whatever progress had been made during
the Clinton administration until the breakdown of talks between Yasser Arafat
and Yehud Barak in 2000. Two events have pushed Syria to offer substantial, yet
strategic, concessions in November. It is easy to imagine that the Syrian
government was not very pleased by the re-election of George W. Bush, as many
fear that the hawks in his cabinet will gain more power in the second term.
Colin Powell, who was considered to be the lone dove, whose wings were clipped
however, has resigned giving way to Condoleeza Rice, the very adviser, who is
widely reported to have immediately recognized the opportunity to invade Iraq
afforded by the 9/11 attack on the WTC and the Pentagon. Ever since the invasion
of Iraq, there has always been speculation over the possibility that the US
would also seek to either invade Syria, or seriously undermine its government.
Growing tensions between the United States and Iran over its alleged nuclear
weapons development have added speculation that Iraq may only be a first stop
for the United States in the Middle East.
Moreover, Yasser Arafat has died. No other figure in the history of the recent
Middle East, with the possible exception of Jamal Abdel Nasser of Egypt, has
been so closely associated with the nationalistic aspirations of his people.
Arafat had pushed Syria toward making some concessions over the Golan Heights as
part of the Oslo peace accords. Syria was not happy that Arafat had engaged in
peace negotiations with Israel independently forcing the then President Hafiz
Al-Asad to pursue an independent accord with Israel over the latter's occupation
of the Golan Heights. The combination of a perception of a greater US threat,
symbolized by the rise of Condoleeza Rice as Secretary of State and the removal
of what Prime Minister Sharon defined as an obstacle to peace, Yasser Arafat,
have likely informed Syria's decision to make a renewed offer of peace with
Israel. Syria made the offer through Terje Roed-Larsen, the United Nations
special coordinator for the Middle East peace process, who announced that Syrian
President Bashar al-Assad was ready to resume peace negotiations with Israel
with no preconditions. In the peace process, which officially began at the
Madrid conference in 1991, Syria stressed that any peace agreement with Israel
would necessarily follow the latter's unconditional withdrawal from the Golan
Heights. No peace agreement would be signed before that condition was met. The
plan was based on a Land for Peace strategy. The Oslo accords signed
unilaterally by Yasser Arafat, therefore, disrupted Syria's strategy as they
were based on an establishment of peace before any actual withdrawal took place.
Not surprisingly, the Israeli executive's response has been negative reiterating
the refrain that Syria sponsors international terrorism (i.e. Hizbollah, which
effectively forced Israel to abandon Southern Lebanon after almost 20 years of
occupation).
President Asad's offer may certainly be genuine, but it is also strategic and
gives him the upper hand in the international public relations game. Asad is
clearly appealing to international and Israeli public opinion, where Syria
emerges all the more favourably given the rhetorical responses from the Israeli
government, which appears reluctant to pursue peaceful alternatives with its
neighbours. The official Israeli view is that Asad is not serious. For his part,
Israeli observers have noted that Asad is well aware that he can make offers of
peace without fear that these be suddenly implemented. Israel has already agreed
to withdraw from Gaza, a decision that has angered many Israeli settlers in the
occupied territories. Asad is buying time and cultivating a positive image with
the West. Syria's image has been tarnished by recent calls for the withdrawal of
troops from Lebanon. The calls were made by the United States and France and
reached a peak during the Lebanese elections in September. Nevertheless, the
popular and influential Israeli President Moshe Katsav urged the government to
consider the Syrian offer of peace seriously, as he stated in an interview with
the Israeli newspaper Maariv. Prime Minister Sharon declined to comment on the
overture by president Katsav; however, the government appeared uninterested to
consider discussions with Syria suggesting Syria is harbouring wanted terrorists
from Hamas and other Palestinian groups. Nevertheless, Syria scored significant
points in the all-important Middle East public relations game. Moreover, Syria
quietly began to comply with demands from the International community that it
leave Lebanon. By winter's end, it is expected that the vast majority of Syria's
13,000 troops will have left Lebanon. The Syrian foreign minister delivered this
information personally to Secretary of State Colin Powell in Sharm el-Sheikh at
the Iraq Conference held there on November 23rd. Syria will still deploy some
troops to guard key radar installations and other strategic areas in accordance
with the joint Syro-Lebanese defence agreement. Syria, nevertheless, noted that
as its actions in Lebanon are aimed to comply with the UN Resolutions 1554, it
expects Israel to follow suit by withdrawing from the Golan Heights as
stipulated in resolutions 224 and 338. Syria's compliance with its UN stipulated
obligations has ostensibly resulted from a desire to thwart any potential
imposition of sanctions or even an invasion. The re-election of George W. Bush
has doubtless raised fears that pending UN resolutions might serve as an excuse
for interference. The European Union has maintained friendly relations with
Syria, which has in turn shown very strong interest in slipping away from US
pressure by embracing the Euro-Mediterranean Conference. Syria is still said to
possess large numbers of chemical and biological weapons, which the European
Union has classified as being "under international monitoring"
affording Syria the possibility of maintaining them for the time being. Syria
has relied on its relationship with the European Union to promote the sale of
Syrian products. Syria has been urged by the EU to be a more active member of
Euromed, and offered assistance in improving the quality of its products for the
European market. The products envisaged for export are likely to be agricultural
such as olive oil, milk and cheese and a number of projects in Syria have been
funded by the European EU to that end. Textile products are also seen as a
viable export from Syria.
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FOREIGN LOANS
EIB provides EUR 200 million to Deir Ali power plant
The European Investment Bank (EIB) is providing Syria with a 200m euro loan to
part-finance the building of a 750-MW natural gas-fired combined cycle power
plant in Deir-Ali, south of Damascus. Total cost of the plant is estimated at
US$350m. The power plant will comprise of two 250-MW gas turbines and a 250-MW
steam turbine.
The building of the plant is expected to take over 30 months. The loan will go
to the Public Establishment of Electricity for Generation and Transmission (PEEGT).
The PEEGT had issued an initial tender for the plant in November 2003 and due to
weak responses it reissued it in March of this year. Ireland's ESB International
(ESBI) was awarded the contract to evaluate bids to build the plant.
A signing ceremony took place in Damascus on that occasion with the presence of
EIB's Vice-President, Mr Philippe de Fontaine Vive. The EIB justified its
financing of this investment by the Bank's support to Syria's strategic decision
to switch from oil-based to gas-based electricity generation.
The loan falls under the FEMIP (Facility for Euro- Mediterranean investment and
Partnership) programme and is the largest ever provided by the EIB to Syria. It
is the third such disbursement by EIB in Syria's electricity sector. Two former
loans of 115m euro and 75m euro respectively had already been advanced by the EU
lending institution. FEMIP was launched by the European Investment Bank (EIB) as
an initiative to support private sector financing in the Mediterranean area.
The signing of this new agreement between EIB and the Syrian Government comes on
line with the beginning of operations of the SME fund, a 40m euro credit line
directed at Syrian SMEs to finance their capital needs, also part of the FEMIP
programme. The fund is managed by DFC, a Spanish consultancy firm, which was
awarded the 2m euro contract last June.
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