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Syria - NEWS BRIEFINGS
Syria | 04.06.2007
Figures detailing the country's foreign trade contained good news and bad news for the economy, with exports rising strongly but overseas sales still underpinned by oil, a rapidly diminishing resource.

Syria - COUNTRY PROFILE

Geography

Syria's eastern border with Iraq runs mainly through the desert, while the northern border with Turkey is more mountainous. The very easternmost part of the border with Turkey is the Tigris River, while the Euphrates crosses into Syria about 100 km north-east of Aleppo. Syria's main ports of Lattakia and Tartous are on the Mediterranean Sea in the west, and further south the western part of the country borders Lebanon. Just to the south of this region lies the disputed Golan Heights; the Israeli border is about 50 km from Damascus, causing no end of worries in the capital. From the Golan the border with Jordan turns eastwards, to the south of Jebel Druze, until it reaches the Iraqi Desert. From the coastline in the west the land rises sharply to a series of mountain ridges, which have snow every winter, but are wonderfully verdant in the summer, before falling gently to the plain of central Syria. East of here the mountains rise again, but less spectacularly than in the west, before again falling to the Syrian Desert. The main cities are all on a north-south axis, stretching from Damascus in the south, via Homs and Hama, to Aleppo in the north.

Recent History

The Syrian Arab Republic was dominated over the last 30 years by President Hafez al-Assad before his death in June 2000. He came to power on the back of the Ba'ath Party, a party which has distinctly socialist tendencies, but has also had pan-Arab ideals, as is shown by the attempted union with Nasser's Egypt in the early 1960s. The Syrian Ba'ath Party split early from its Iraqi counterpart.

Today, Syria is adapting to life under Hafez al-Assad's son, Bashar. An ophthalmologist by training, educated partly in London, the young leader is heralded as the symbol of Syria's private sector new guard, who are keen to increase exports and boost the development of IT.

Still outstanding is the issue of peace with Israel based on the principle of full withdrawal from the Golan Heights. With no breakthrough on this in sight, Syria remains technically at war with Israel.

The constitution, originally adopted in 1930, but revised and amended in 1973, calls Syria a "democratic and populist" country. Its age requirement for a presidential candidate had to be slightly modified to allow Bashar's accession. Although elections do take place, for the parliament and for the presidency, Assad's 99% election results have become the stuff of legend.

Hafez al-Assad's eldest son, Basil, was to follow in his fathers footsteps, but following his death in a car accident in 1994, the second son, Bashar, received training in order to succeed his father. After his recall from medical studies abroad his influence and power in Syria were on the increase, in contrast to his father's failing health. After becoming president in 2000, Bashar has largely continued where his father left off, all the while pushing for certain economic reforms.

Elections for the Syrian parliament, called the Majlis al-Shaab or the Peoples Council, are held every four years. For the most recent election in March 2003, the National Progressive Front (NPF) - within which the Ba'ath Party forms the largest block - won 167 of the 250 seats. The remaining seats all went to independents.

Much of the actual power wielded in Syria comes from the Alawi sect of Shia Islam, of which Bashar is a member. Although religion no longer plays such a large a role in Syria, this minority from the mountains near Lebanon has held itself together as a social community.

Syria has a great deal of international attention focused on it, as it is a vital player in the politics of the Middle East. Since the 2003 US-led invasion of Iraq, it has also found itself having to engage in a great deal of regional diplomacy, including Bashar making an important breakthrough visit to neighbouring Turkey in January 2004. Relations with the US have been poor in recent years, with Washington passing a raft of sanctions against the country in late 2003. Meanwhile, Damascus has sought to cultivate better relations with the European Union, although talks on signing an Association Agreement are currently stalled. Syria also has had a major role in neighbouring Lebanon, where it maintained a substantial military and police presence up until final withdrawal in April 2005. Since then, however, Damascus has continued to be dogged by allegations over its role in Lebanon.

Government and Politics

Major Political Players:

Bashar al-Assad: President since his father's death in June 2000. It is hoped that his presidency will herald much-needed reform.

Muhammad Naji al-Otri: Prime minister since September 2003, when he replaced Mustapha Miro, who had been criticised for pursuing reforms too slowly.

Farouq al-Sharaa: Foreign minister since 2001. He has had a high profile in discussions over the future of neighbouring Iraq in 2003-2004.

Hassan Turkmeni: Defence minister since mid-2004, he replaced the well-respected Mustafa Tlas.

Amer Hosni Lotfi: Minister of economy and trade. Replaced Ghassan Rifai in October 2004. Previously head of the state marketing board for cotton, one of the country's agricultural staples.

Muhammad al-Hussein: Minister of finance since 2001.

Population

Around 60% of the Syrian population lives in urban areas, and the two largest cities, Damascus and Aleppo, each have approximately 3.5m inhabitants. Small ethnic minorities are represented in Syria, but their presence is not a major issue as it is in some neighbouring countries. Palestinians are obviously present, but the numbers are not anything like those in Jordan or Lebanon. In a similar way the Kurds are represented in the north-east of the country, but again the numbers are minimal, allowing Syria to escape most of the "Kurdish problem". Disturbances in 2004 in the Kurdish areas were quickly quelled, and the government has sought to address the citizenship concerns of some "state-less" Kurdish residents. In terms of religion, the majority of the country is Muslim, around 70% mainstream Sunni; however, the Alawis, a small sect of Islam, remain prominent in public life. Some of the population of Damascus and Aleppo are Christian, as are some residents in villages north-west of Damascus. However, religion does not play much of a role in Syrian life, as the country is formally secular and it has long been held that an individual's religion is a personal matter.

Syria inherited its education system from the French mandate period, resulting in quite a high standard of education, though not as developed as the system in Lebanon. English has now replaced French as the second language taught in schools. It is believed that about 90% of men and 65% of women are literate, a rate which is slowly climbing. However, the health system is not in good shape due to a chronic lack of funding.

Economy

Syria remains a country being pulled in two separate economic directions. On the one side lie the state-centric economic policies of the past, imbued as they are with the principles of socialist economic thinking. Whilst on the other side lie the increasing demands of a capitalist, free market economy.

About one-third of Syria is cultivated, agriculture being one of the most important contributing factors to the economy. Agriculture represents up to 30% of GDP according to some estimates, employs some 30% of the workforce, and it is estimated that another 20% of workers are indirectly dependent on this sector. The investments made in agriculture by the government have allowed Syria to somewhat negate the rural-urban drift all too common in other parts of the Middle East. The World Bank divvied up Syria's GDP in 2004 as follows: agriculture 25%, industry 31% and services 44%.

The country is fed by two of the region's largest rivers, the Tigris and the Euphrates, in addition to the run-off from the mountains, which receive a fair amount of winter precipitation. Unfortunately, the rivers have been a source of dispute with Turkey in recent years, since both countries have built hydro schemes along the rivers.

Agriculture is heavily centralised, with strong government intervention in the cultivation of cotton and cereals. Fruits and vegetables, which are also important in this sector, are left far more to market forces.

Oil production remains an important aspect of the economy, and it is estimated that Syria has 3bn barrels of oil reserves, not all of it recoverable. Recoverable gas reserves, estimated at 300bn cu metres, have been pressed into service to supply Syria's insatiable thirst for electricity. The production of oil has been falling in the latter half of the 1990s, even in the last few years it has fallen from 604,000 barrels per day (bpd) in 1996 to 520,000 bpd in 2004. Some say that this decline in exports was arrested thanks to the pumping of Iraqi oil through the UN's "oil for food" programme in the years prior to the US occupation of Iraq. However, the Syrian government strenuously denies these allegations. The SCOT pipeline, which can transport oil from Iraq to Syria's Mediterranean ports, was destroyed in fighting following the Gulf war in 2003, and has not yet recommenced pumping operations outside of its branchlines in Syria proper.

The Syrian public sector is vastly over-staffed, and often poorly paid. Moves to dramatically improve the salaries of state employees, by pay rises of up to 20% in 2004, have worried many that they could inspire inflation. Corruption remains a significant problem in Syria, as are the restrictions the government imposes on the private sector. The millstone of taxes and duties still weighs heavily around the neck of much of Syria's private sector. The privatisation of key assets has not been countenanced on a grand scale, and is unlikely to be in the foreseeable future. Thus far, most of the private sector is concentrated in light industry, whilst the government retains control over the "big wheels" of the economy.

Reform is much needed in Syria, but it is slow in coming. However, the recent endorsement by the cabinet of Bashar's liberalising policies in regard to harmonising the multiple exchange rate regime and allowing for the limited operations of private banks herald real change. A major cabinet reshuffle in December 2001 saw changes in the economic ministries in favour of reformists. This trend was continued in the November 2003 cabinet reshuffle, which also entailed a reduction in the number of ministries.

Most light industry is concentrated around Damascus and Aleppo, whilst the heavier industry is around the cities of Homs and Hama in central Syria. Oil and gas meanwhile are produced in the east of the country near Deir ez-Zour.

Accurate statistics remain difficult to obtain for the Syrian economy, though recent projects involving French and German aid missions aim to reform the Syrian state's budgetary performance, and improve the collation and publication of timely economic data.

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