Business and investment opportunities in Syria

Syria’s economic policy has in the past been based on import-substitution policies meant to protect domestic industries from foreign competition. A gradual process of opening up began in 1991, which has accelerated somewhat in recent years. Syria has clearly taken a number of steps to improve conditions for private investment. These measures include: simplification and reduction of certain tariff rates starting in 2001; a cut in the standard corporate tax rate on private companies to 25 percent in 2003; a 2001 banking sector law allowing private operators on the market, with four banks starting operations in 2004; and substantial investment in electric power generation. Thus, there are numerous business and investment opportunities, particularly in infrastructure, finance, and tourism.

The country’s transport infrastructure needs to be developed, upgraded, and modernised. According to the 2006-2010 five-year plan, Syria should invest the equivalent of $523 million for development of its eastern regions over the next five years, nearly LBP17 billion ($323 million) in investments in the Hassake area and LBP10.2 billion in the region of Deir Al-Zor area.

New oil refineries and an industrial park are also planned. The purpose of these investments is to make eastern Syria a platform for development towards Turkey and Iraq. Eastern Syria is indeed a strategic location for the country, playing a major economic role (oil, corn and cotton, major hydraulic resources thanks to the Euphrates, Khabour and the Tigris).

The highway network will double over the next five years, from 1100 km to 2300 km. Syria wants to capitalise on its geographic location to become a gateway for transit between the Mediterranean and Iraq and between Turkey and the Gulf countries. The Ministry of Transport hopes to attract foreign investors by proposing concession contracts in the form of BOT.

Other infrastructure development projects include modernisation of the ports of Lattakia and Tartous, the latter being the largest commercial port, enjoying an impressive increase in traffic thanks to growth of trade with Iraq. In addition, in this sector, the Ministry of Transport will grant private concessions for the management of part of the terminal in the form of a BOT contract.

The country’s five airports (Qamishli, Lattakia, Deir-ez-Zor, Aleppo, Homs) will be modernised and extended. As for the railway network, the objective is to set up express lines, such as Damascus-Aleppo route, which will make it possible to get between these two major Syrian cities in less than two hours.

The services sector also offers many investment opportunities. Ongoing reforms, in particular in the financial sector, reflect the commitment of Syrian authorities to carry out a vast modernisation programme and a new legal framework for privatisation that will ease market access. The banking and insurance sectors have been opened to private and foreign operators. In information technologies, the country’s telecom and internet grids will be extended and new operators, in particular on the web, are expected to propose new services and content.

Tourism is one of the most dynamic activities in the country. The government has adopted a new vision for tourism, with plans to make it a pillar of the national economy. Acquired skills should make it possible to advance to a new stage of development, with new hotels and leisure equipment that meet demand for elitist, cultural tourism. The country’s middle-level hotel infrastructure is insufficient and in any case outdated and there is not much in the way of leisure facilities, aside from services offered at luxury hotels).

Following the Tourism Investment Market Forum held in April 2005 at which the Ministry of Tourism proposed 33 project ideas to foreign investors, 13 initiatives were contracted, worth $600 billion and for the first time hotel management companies were authorised to enter Syria: Intercontinental, Holiday Inn, Royal, Accor and Soys Inn. At the 2006 Forum the government is offering investment opportunities in 43 projects located in 12 governorates.

A number of projects initiated several years ago by the private sector (such as the Damascus International Airport and coastal roads) are not yet finished. Old cities (especially in Aleppo and Damascus) attract a growing number of national and international investors, who buy and restore old homes for their own use or to open boutique hotels and restaurants. Opportunities in the tourist sector include:

 Infrastructure: desalination of seawater, water purification, installation of electricity, telecommunications, transport;

 Tourist products such as leisure equipment, entertainment and sporting activities, seaside resorts, spa therapy, museums, sound and light shows, consulting;

 Products: construction, management, consulting, software;

 Training: partnership with the Training Centre for Tourism and Hotel, upgrading of existing schools, creation of an institute of gastronomy;

 Promotion: communications, marketing, board of trustees;

 Financial investments: hotels, resorts, leisure clubs and parks, development of cultural sites, festivals.

Business opportunities also exist in agriculture and manufacturing. Syria has developed expertise and know-how in agriculture, notably in cotton and olive tree production, but also greenhouse fruit and vegetable crops are developed, requiring new equipment, packaging technologies transfer, etc. Downstream, food processing industries, largely under public control, need to be progressively opened to new actors. In industry, aside from a few large oil facilities, there are dynamic small and medium industries, notably textile factories, pharmaceutical subcontracting firms and mechanical assembly firms.

This section's articles

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