Syria to make itself more attractive to foreign investment

Feb 22, 2003 01:00 AM

With Syria gearing up for next month’s parliamentary elections, the large number of youthful candidates has caused some speculation that further change is on the way. Meanwhile, as Syrian officials continued to look for ways to boost foreign investment, development in the oil sector made national headlines.
The elections -- the first since President Bashar Al-Assad took office -- are scheduled in March. During the Eid holiday earlier this month, many of the candidates had begun their election campaigns by stressing their youth and/or their high educational qualifications. In addition, most of the candidates also stressed their commitment to making the country more attractive to foreign investment.

It was not out of place then for this new face of Syria to find itself on show in Cyprus mid-February, where a conference on investment opportunities saw government officials tackle Cypriot business leaders on why Syria was now such a good prospect.
There has been considerable interest shown inSyria’s free trade zones and in setting up private banks, a view often repeated by Syria’s dailies. Samer al-Debs of the Damascus Chamber of Industry was quoted in one daily praising “the remarkable development Syria has witnessed in different sectors -- especially in the investment and economic fields” in recent years. The Director General of Syria’s free zones, Adnan Souleiman, has also talked on investment law in the light of recent new decrees.

One outcome of the event was the expectation that there would be a strong showing of Cypriot business leaders at the BATEX 2003 trade fair, due to be held in Damascus next April. The Syria Times claimed that more than 16 Cypriot companies were likely to attend.
The gathering also came at a particularly low point in Syrian-Cypriot trade relations, after the Cypriot government had cancelled it's participation in an extension to Cyprus of the proposed Egyptian-Syrian natural gas pipeline early February. In a demonstration of the energy industry’s remarkable resilience though, good news quickly followed bad, after the arrival in Damascus February 8th of a Russian delegation made up of executives of Russia's state-owned oil company ZarubezhNeft saw a new agreement.

The delegation met with Syrian Oil and Mineral Resources Minister Ibrahim Haddad and announced plans to set up a joint Russian-Syrian company, Amrit, which will carry out exploration, excavation and drilling for gas and oil, including at sites in coastal waters.
Haddad signed the agreement to establish Amrit and told that the company would “pay an important role in Syria and the region”. The move came after several months of negotiations between the state owned Syrian Petrol Company (SPC) and ZarubezhNeft. It is also one of a series of possible joint ventures Syrian officials are currently negotiating.

The Canadian company Tanganyika is in discussion over developing the Ouda field in northeast Syria, which is thought to hold reserves of 2 bn barrels, while the Ministry of Petroleum announced in January 2003 that it was to begin talks with the Chinese National Petroleum Corporation (CNPC) on another possible joint venture.
Yet the current crisis over Iraq is also casting a shadow on Syria’s oil sector. With oil prices now over $ 30 a barrel, exporting any surplus has become an increasingly attractive proposition. As a result, Syria has scheduled a heavy export programme of some 450 000 bpd for March. This represents a hefty slice of the country's total domestic production capacity of 550 000 bpd.

With Syria’s refineries using around 300 000 bpd, has been taken by many industry insiders to imply that Damascus would also be importing oil to make up the difference -- and that this would likely come from its neighbour, Iraq.
For its part, the Syrian government says that the added export figures are due to increased oil production from Syrian fields and the conversion of the country’s power stations from oil to gas.

Source: The Oxford Business Group
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