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Country Report 4Th Quarter 1997 © the Economist Intelligence Unit Limited 1997

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Country Report 4Th Quarter 1997 © the Economist Intelligence Unit Limited 1997 COUNTRY REPORT Syria 4th quarter 1997 The Economist Intelligence Unit 15 Regent Street, London SW1Y 4LR United Kingdom The Economist Intelligence Unit The Economist Intelligence Unit is a specialist publisher serving companies establishing and managing operations across national borders. For over 50 years it has been a source of information on business developments, economic and political trends, government regulations and corporate practice worldwide. The EIU delivers its information in four ways: through subscription products ranging from newsletters to annual reference works; through specific research reports, whether for general release or for particular clients; through electronic publishing; and by organising conferences and roundtables. The firm is a member of The Economist Group. London New York Hong Kong The Economist Intelligence Unit The Economist Intelligence Unit The Economist Intelligence Unit 15 Regent Street The Economist Building 25/F, Dah Sing Financial Centre London 111 West 57th Street 108 Gloucester Road SW1Y 4LR New York Wanchai United Kingdom NY 10019, USA Hong Kong Tel: (44.171) 830 1000 Tel: (1.212) 554 0600 Tel: (852) 2802 7288 Fax: (44.171) 499 9767 Fax: (1.212) 586 1181/2 Fax: (852) 2802 7638 e-mail: [email protected] e-mail: [email protected] e-mail: [email protected] Website: http://www.eiu.com Electronic delivery EIU Electronic Publishing New York: Lou Celi or Lisa Hennessey Tel: (1.212) 554 0600 Fax: (1.212) 586 0248 London: Moya Veitch Tel: (44.171) 830 1007 Fax: (44.171) 830 1023 This publication is available on the following electronic and other media: Online databases CD-ROM Microfilm FT Profile (UK) Knight-Ridder Information World Microfilms Publications (UK) Tel: (44.171) 825 8000 Inc (USA) Tel: (44.171) 266 2202 DIALOG (USA) SilverPlatter (USA) Tel: (1.415) 254 7000 LEXIS-NEXIS (USA) Tel: (1.800) 227 4908 M.A.I.D/Profound (UK) Tel: (44.171) 930 6900 Copyright © 1997 The Economist Intelligence Unit Limited. All rights reserved. Neither this publication nor any part of it may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of The Economist Intelligence Unit Limited. All information in this report is verified to the best of the author’s and the publisher’s ability. However, the EIU does not accept responsibility for any loss arising from reliance on it. ISSN 0269-7211 Symbols for tables “n/a” means not available; “–” means not applicable Printed and distributed by Redhouse Press Ltd, Unit 151, Dartford Trade Park, Dartford, Kent DA1 1QB, UK Syria 1 Contents 3 Summary 4 Political structure 5 Economic structure 6 Outlook for 1998-99 9 Review 9 The political scene 14 Economic policy and the economy 16 Oil and gas 18 Agriculture and mining 19 Industry 20 Transport, communications and tourism 21 Foreign trade and payments 23 Quarterly indicators and trade data List of tables 9 Forecast summary 23 Quarterly indicators of economic activity 24 Trade with major partners List of figures 9 Gross domestic product 9 Syrian pound: exchange rate EIU Country Report 4th quarter 1997 © The Economist Intelligence Unit Limited 1997 Syria 3 October 14, 1997 Summary 4th quarter 1997 Outlook for 1998-99: Hafez al-Assad will remain in control of Syria and Lebanon for as long as his health holds, but his position in the conflict with Israel will remain weak and his options for initiating action within the region will be limited. Investment in oil and infrastructure will keep the economy expanding, but annual GDP growth will remain below 4% pending more deci- sive action in favour of economic reform. Increases in private transfers and services income will offset the impact of lower oil and cotton prices on export earnings, keeping the current account in surplus. The political scene: Fighting has escalated in south Lebanon between the Syrian-backed guerrilla movement, Hizbullah, and Israeli forces. Madeleine Albright’s first visit to the region has done little to spur on peace talks with Israel. Relations with Iraq have deepened, with improved transport links and trade and transit deals. The president’s son is taking on wider responsibilities. Economic policy and the economy: The government has said it will speed up economic reform, but without giving details or a timetable. It has devalued the pound and moved to calculate its budget at the higher “neighbouring countries” exchange rate. Oil and gas: Details of the government’s exploration deal with Elf have been released, and an Irish firm, Tullow, has started production at the Kishma field. The threat of US sanctions has contributed to a government rethink on a gas processing deal with Conoco. Agriculture and mining: Cereal production is down because of poor weather earlier in the year. Phosphate output is scheduled to double by 2000. Industry: Construction of a 1,065-mw power plant at Aleppo is almost com- plete and other upgrade projects are planned. The government is to build a new sugar factory at Homs and the Japanese have begun a study on the textile industry. Transport, communications and tourism: Payments for six new Airbus aircraft have begun and bids to increase telephone line capacity are being evaluated. Jordanian tourism companies have been blacklisted. Foreign trade and payments: The government is looking to a trade group within the region as a step towards joining the WTO. It has agreed to pay off its debt arrears to the World Bank. Editor: Naomi Sakr All queries: Tel: (44.171) 830 1007 Fax: (44.171) 830 1023 EIU Country Report 4th quarter 1997 © The Economist Intelligence Unit Limited 1997 4 Syria Political structure Official name Syrian Arab Republic Form of state Socialist republic Legal system Based on the constitution of 1973 Legislature 250-member Majlis al-Shaab (People’s Assembly) directly elected for a four-year term Electoral system Universal adult suffrage National elections Due by 1998 (presidential); 1999 (legislative) Head of state President, directly elected for a seven-year term. The president appoints the vice-presidents, the prime minister and the Council of Ministers. Hafez al-Assad, who was elected president in March 1971 and re-elected in 1978, 1985 and 1991, holds the posts of commander-in-chief of the armed forces and secretary-general of the Baath Party. Vice-presidents: Abdel-Halim Khaddam, Rifaat al-Assad, Zuheir Masharka Executive Council of Ministers headed by the prime minister. Its members are drawn from the Baath Party and its partners; last reshuffle in June 1992 Main political parties Seven parties form the ruling National Progressive Front (NPF): Arab Socialist Baath Party; Arab Socialist Party; Arab Socialist Unionist Party; Communist Party; Syrian Arab Socialist Union Party; Unionist Socialist Democratic Party; Union Socialist Party Prime minister Mahmoud al-Zubi Deputy prime minister Mustafa Tlas Deputy prime minister for economic affairs Salim Yasin Deputy prime minister for social services Rashid Akhtariani Key ministers Agriculture & agrarian reform Assad Mustafa Communications Ridwan Martini Construction Majid Uzzu al-Ruhaibani Culture Najah al-Attar Defence Mustafa Tlas Economy & foreign trade Mohammed al-Imadi Education Mohammed Ghassan Halabi Electricity Munib Asaad Saim al-Daher Finance Khaled al-Mahayni Foreign affairs Farouq al-Shara Health Mohammed Iyad al-Shatti Higher education Salha Sankar Housing & utilities Husam al-Safadi Industry Ahmed Nizameddin Information Mohammed Salman Interior Mohammed Harba Irrigation Abdel-Rahman Madani Oil & mineral resources Mohammed Maher Jamal Planning Abdel-Rahim Sabayi Social affairs & labour Ali Khalil Supply & internal trade Nadim Akash Tourism Danhu Daoud Transport Mufid Abdel-Karim Central Bank governor Mohammed Bashar Kabbara EIU Country Report 4th quarter 1997 © The Economist Intelligence Unit Limited 1997 Syria 5 Economic structure Latest available figures Economic indicators 1992 1993 1994 1995 1996a GDP at market prices S£ bn 371.6 413.8 496.5 552.4b 695.2b Real GDP growth % 10.6 6.7 7.6 3.6b 5.0 Consumer price inflation % 9.5 11.8 20.0 22.0a 20.0 Population m 12.96 13.31 13.88 14.37 14.88b Merchandise exports fob $ m 3,100 3,203 3,329 3,858 4,298b Merchandise imports fob $ m 2,941 3,476 4,604 4,001 4,516b Current account $ m 56 –579 –791 367 285 Total external debt $ bn (Dec) 19.0 20.0 20.6 21.3 22.5 Total debt service paid $ m 305 283 398 293 501 Exchange ratec S£:$ 11.225 11.225 11.225 11.225 11.225 October 10, 1997 S£45.00:$1d Origins of gross domestic product 1995b % of total Components of gross domestic product 1995b % of total Agriculture 20.7 Private consumption 68.1 Mining & manufacturing 28.5 Public consumption 14.3 Building & construction 2.8 Gross fixed capital formation 15.6 Trade (wholesale & retail) 18.5 Exports of goods & services 23.1 Transport & communications 11.6 Imports of goods & services –21.1 Finance & insurance 4.7 GDP at current prices 100.0 Government services 11.7 Social & personal services 1.5 GDP (at 1985 prices) 100.0 Principal exports 1995b % of total Principal imports 1995b % of total Petroleum & petroleum products 62.5 Manufactured goods 31.8 Manufactured goods 16.8 Machinery & equipment 31.6 Food & live animals 11.6 Food & live animals 13.7 Total incl others 100.0 Chemicals 10.2 Total incl others 100.0 Main destinations of exports 1996 % of total Main origins of imports 1996 % of total Italy 17.5 Italy 8.1 Germany 14.0 Germany 6.2 France 9.6 South Korea 4.9 Turkey 9.3 France 4.5 Lebanon 6.9 Japan 4.5 Spain 6.0 USA 3.8 Saudi Arabia 5.3 UK 2.6 a EIU estimates.
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