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Key Economic Data 
  2002 2001 2000 Ranking(2002)
Millions of US $ 21,900 19,500  17,896 64
GNI per capita
 US $ 1,130 1,040     950 131
Ranking is given out of 208 nations - (data from the World Bank)

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 Syrian pound (SYP)

Bashir al-Asad


Update No: 014 - (01/01/05)

Some hope in the quagmire
In many ways 2004 could have been a worse year for Syria, for on numerous occasions it seemed as if Syria had become incapable of guiding its future. Throughout the year, the main areas of contention have been Syria's porous borders with Iraq and the growing tensions with Israel, which demonstrated on numerous occasions that it could act with impunity attacking symbolic targets within Syria. Both the US and the new Iraqi government of Prime Minister Allawi have repeatedly accused Syria of supporting former Iraqi Ba'athists and other rebels coming from various parts of the Arab world of directly supporting and fuelling the resistance movement in Iraq. Shortly after taking over as interim Prime Minister, however, Ayad Allawi visited Syria in July where he received assurances from his Syrian counterpart Naji el Otri that Syria was opposed to any cross-border infiltration. Unlike the Gulf War of 1990-91, where it was a key ally of the international coalition opposing Iraq's invasion of Kuwait, Syria strongly objected to the US led war on Iraq. Therefore, the diplomatic overtures between Damascus and Baghdad under the US backed government were very important. Syria may even have hoped to gain contracts for Syrian companies or Syrian labour in Iraq, but it was primarily motivated by the need for reassurance that Syria will not have to contemplate a similar fate to Iraq. The United States has never satisfactorily denied speculation that it intends to effect regime change in Syria as well. For its part, the US has repeatedly accused Syria of allowing or not doing enough to stop infiltration of fighters through the Syrian border to Iraq to fight coalition forces. Syria, for its part, always denied the accusations and stressed that it lacked the capability of policing the border with its eastern neighbour. The Iraqi-Syrian talks also dealt with resolving the issue of Iraqi assets frozen in Syrian banks since the coalition toppled Saddam's regime. In the early spring, President Bush announced the imposition of the Syrian Accountability Act in retaliation for Syria's refusal to abandon weapons of mass destruction, even while the head of the IAEA, the International Atomic Energy Agency, said in there was no such evidence in Syria. Syria and the United States have, nonetheless, maintained diplomatic relations throughout the crisis. 
Moreover, the United States did not express any concern over Israeli strikes in Syrian territory as well as Syrian controlled Southern Lebanon throughout the year. The most recent of these attacks, though no one has claimed official responsibility, occurred in mid-December when a Hamas activist, Mesbah Abu Hweileh, survived a bombing that destroyed his car on a Damascus street just after he and his family stepped out of the car. Whether or not, Israel is to blame for this latest attack, Syria has no doubt perceives the ease with which Israel has been able to penetrate its borders as serious intelligence and prestige failures. Since the 1973 Arab - Israeli war Syria has tried to avoid challenging Israel directly. Lebanon is a prime example of this strategy, where Syria 'fought' Israel by proxy though the Hizbollah army. However, just as allowing the PLO to establish itself in Beirut during the 1970's proved to be an enormous problem for Lebanon, as it invited the Israeli invasion of 1982 and fomented civil conflict. The presence of senior members of the Palestinian resistance organizations such as Hamas or Fatah are clearly putting Syria in a dangerous position vis--vis Israel, as well as the United States which is also concerned about organizations such as Hizbollah. Indeed, in the early spring the US Congress issued the Syria Accountability Act, which makes it accountable for the activities of those terror groups, whether or not it actively supports them. Syrian claims that Hamas or Fatah are merely conducting public relations campaigns from Damascus do not exempt it from falling under the Accountability Act's provisions. 

A renewed Peace Process in 2005.
Nevertheless, should Syria expel representatives of the Palestinian resistance organizations it would lose an important mechanism in forcing Israel to come to a comprehensive peace agreement, which includes a land for peace exchange over the Golan Heights as well as the establishment of a Palestinian state. In fact, Syria fears that were the Palestinians and the Israelis to reach an agreement, it would perhaps forever lose any hope of regaining the Golan Heights. Syria would remain isolated. The presence of Palestinian organizations in Damascus allows Syria to exert some influence over Palestinian diplomatic efforts, while also allowing it to remain actively engaged in the process. Over the course of 2005, Syria will have to consider the presence of Palestinian resistance groups in Damascus very carefully. Indeed, Israel has set conditions to resume talks with Syria only if the latter expels these organizations; a delicate balance of conditions and strategies will have to be reached internally in Israel and Syria before any serious talks may begin. The last weeks of 2004 have seen remarkable progress toward the re-establishment of a peace process. 
Syria on several occasions offered to discuss peace with Israel making its most serious effort in this respect in November. President Bashir Al-Asad offered to discuss the exchange of land for peace with Prime Minster Sharon, who dismissed the idea. However, President Katzav was more favourably disposed suggesting Israel should consider the offer seriously - if only because it would also put Syria in the difficult position of actually having to follow through on their offer. In a surprise move given the collapse of the peace process, Israel's foreign minister Silvan Shalom indicated that Israel is considering reversing its policy of no discussion, hinting that it is favourably considering backing the long lost US "Road Map" leading to the establishment of a Palestinian State. Shalom also indicated, mere weeks after rejecting it, that Israel would also consider Syria's overtures for negotiation if Syria, as well as the Palestinian Authority (PA) would make efforts to control guerrilla activity by the various groups which the respective parties control. In this respect, 2005 is set to be a very important year. Mahmoud Abbas, who is widely expected to win the Palestinian elections in January, has already declared the second 'intifadah' that has been waging since 2000 to be a mistake and has asked all Palestinian groups to stop attacks against Israel.
Should Abbas win and maintain his current stance it will make it very difficult for Prime Minister Sharon's government to back down from their offer to discuss the Road Map. The United States will certainly apply considerable pressure now on Sharon to work with Abbas, as the excuse of Arafat can no longer be offered as an obstacle to peace. For its part Syria will do its best to participate in the process, for as established earlier, it fears a bi-lateral Israeli-Palestinian deal. This suggests that Syria will also reduce its military presence and influence in Lebanon, over which it received much criticism in September when it advised Lebanon to change the constitution to allow President Emile Lahoud to extend his term as run for elections again. France and the United States exerted pressure on the United Nations to pass a resolution against Syria for its undue involvement in the affairs of another state. Syria quietly started to reduce the number of troops in Lebanon. In 2005, The Lebanese question will come to the fore as Lebanese nationalistic leaders such as Walid Jumblatt have become more vocal in their opposition to Syrian meddling in Lebanon's internal affairs, while the potential re-establishment of an Arab-Israeli peace process will also require a re-consideration of Syria's presence.

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