Fredric C. Hof‘s name was floated in a Kuwaiti paper as the next ambassador to Damascus. Sami Moubayed picked up the story, but soon published a denial from Hof, who explained that he had not been offered the job. Hof wrote,

“To paraphrase Mark Twain, rumours of my impending appointment are greatly exaggerated. Indeed, they are false. I have maintained a lifelong habit of not accepting jobs I’ve not been offered, and this one will be no exception.

When I was an American Field Service exchange student in Damascus in 1964 I promised my Syrian friends I’d someday return as Ambassador. Some of them will be disappointed to learn that your report has no basis in fact. Others will be relieved.”

The last sentence of Hof’s denial highlights the struggle now being waged in the halls of the State Department and White House over the selection of the next ambassador to Syria. His name was probably leaked to the notorious Kuwaiti “source” in order to “burn” Hof’s candidacy, as one Syrian official suggested to me. Read this article by Aimee Kligman in the “New York Foreign Policy Examiner” to see how threatening the Hof selection is to some. Not only does Hof speak Arabic, but he lived for almost a year near Shahbandar square in the Mazraa section of Damascus and enjoyed it. He has spent a lifetime studying the Syrian-Israeli conflict and Lebanon – Israel border problems. He knows the technical aspects of the Golan problem better than anyone and has written brilliantly on it. Worse yet, he speaks to Arab organizations.

But read his speech: “FROM MITCHELL TO ANNAPOLIS AND BEYOND: THOUGHTS ON THE AMERICAN ROLE IN PALESTINIAN-ISRAELI PEACEMAKING,” given at the The Palestine Center of the Jerusalem Fund March 20, 2008 to understand why alarm bells went off in certain quarters when his name was leaked as a contender for such a sensitive and important post when Obama claimedmhe would work for peace from day one.

Hof is close to Mitchell and acted as the expert on and author of the Mitchell Committee of 2000-2001, which was mandated to recommend ways in which the US could put out the flames of Intifada II. Hof explains:

The … Mitchell Committee [taught me] that effective American facilitation and mediation are absolutely essential. I came away from the experience firmly believing that the parties are incapable of making serious progress absent a central role for the US. I think I also learned that such a role would require intensive, on-the-ground, back-breaking labor. Moreover, without the personal, periodic intervention of the President of the United States, it makes no difference how hard people work or how brilliant the strategy might be.

This is just what many influential Israelis did not want to hear. Vice President Cheney’s office was hostile to the report from its inception, Hof explains. Israeli Minister of Foreign Affairs Shimon Peres wrote to protest the report’s equation of continued Israeli settlement activity with Palestinian violence as provocations that undermined the peace process. Peres explained:

“Being one of the core issues to be dealt with in the future permanent status negotiations, settlements must not be prejudged as a reason for the outbreak of Palestinian violence.”

According to Elliot Abrams in an interview today in the Jerusalem Post.

When we came in, in 2001, the intifada was going on. It seemed to us pretty clear – and we were right – that there could be no negotiations in the middle of a giant, ongoing terrorist attack….

Later…

We took the view that negotiations had to take place between Israelis and Palestinians – that the American role should not be to invent solutions, or to pressure Israel or the Palestinians into a particular compromise, but rather that we should all get behind an Israeli-Palestinian effort. And at that point, there was an Israeli-Palestinian effort.

Secretary of State Powell distanced himself from the report by insisting that the US “cannot impose solutions on them. The decisions are theirs to make.” As we all know, and Hof makes clear, without direct and firm US leadership there will be no two-state solution.

The new Israeli elections underscore the intelligence of Hof’s warning. If Livni creates a government, it will be too weak to stop settlements and if Netanyahu does, it will be ideologically opposed to stopping them. Ambassador Edward Walker notes that Bibi is a realist and “recently refused to sign a loyalty oath that ruled out a Palestinian State.” But it must be noted that the Likud Party, of which Netanyahu is the leader, states unequivocally that “The Government of Israel flatly rejects the establishment of a Palestinian Arab state west of the Jordan river.”  The Israeli government objects to  Hamas’ refusal to recognize a Jewish state in Palestine, but oddly finds nothing wrong with denying the existence of a Palestinian state. Netanyahu also declared during the last days before the elections that he would not give up the strategic Golan Heights for peace with Syria.

If Mitchel is unable to name an ambassador to Syria that he respects, he will have a difficult time doing the hard work of building trust and pushing peace forward. I do not know whether Hof ever was or remains a candidate for the ambassadorship in Damascus, but I hope for the sake of honesty, US interests, and peace that he does.

A congressional delegation including John Kerry, chairman of the Foreign Relations Committee, Senator Howard Berman, chairman of the Foreign Affairs Committee and Senator Benjamin L. Cardin, chairman of the Terrorism and Homeland Security Subcommittee, is on its way to Syria. The Lebanese are telling them to hold Damascus’ feet to the fire on sovereignty issues. But it seems that John Kerry is eager to get relations with Syria on a proper footing that may lead to advances in Obama’s Middle East agenda.  As he said:

“I will be having some frank discussions about where our relations are and where they ought to be,” Kerry said, adding that he will press the Obama administration to send a US ambassador.

But Kerry said reappointing a US ambassador to Syria would not be “a punishment or a reward.” “It helps you communicate so that you are not guessing. It seems to me that it is very self-defeating not to do it.”

The Syrians have been told that there will be a US ambassador by the end of the month. We will see. Kerry took the initiative to go to Syria to meet Asad, perhaps he is lending his shoulder to the effort to pave the way for renewed diplomatic relations between the two countries? His visit seems to indicate that a regime of confidence building measures can be established and that Obama has not forgotten his promises in the midst of the economic crisis.

The US is interested in constraining Hizbullah and ensuring that Lebanese elections go off without foreign interference.  Syria has yet to name its ambassador to Lebanon, just as the US has yet to name its ambassador to Syria. At the same time, Washington cannot look on Syria as a punching bag or pin cushion, as Bush did. If Obama is going to make any progress on peace in the region, Damascus has to be treated as a partner. This is particularly true as Palestinian arena seems even more hopeless following Israel’s elections. The weakness and division within both the Palestinian and Israeli leadership is profound.

Very right wing Israel supporters were infuriated by the release of Boeing spare parts to Syrian Airlines. They insist that it prefigures the dismantling of sanctions against Syria. Maybe they are right to be concerned?

Obama’s people immediately responded by insisting that sanctions remain firm. The release of parts is a one off thing supported by the need for safety. All the same, it is good business as well as being an important first step in developing confidence building measures for the eventual lifting of sanctions and peace.

Deputy Prime Minister Abdullah Dardari is arguing that lifting sanctions should be a vital part of Syria’s reengaging with Washington. Syria needs foreign investment badly in order to prosper. See my last post with Ehsani on SC. It will be hard for the US to engage without lifting sanctions. Syrians will not believe Washington is motivated by anything but meanness so long as it is trying to starve Syrians and keep their country backwards.

In this regard, Stuart Levey, the central figure in imposing sanctions on Syria  was recently reappointed to his post as head of the secretive Office of Terrorist and Financial Intelligence in the Treasury Department. Levey is entirely a political creature, so this is not necessarily bad for Syria, although he is a loyal republican who began working for government after helping with Bush’s electoral recount in Florida.  Martin Peretz, the New Republic’s editor in chief, was Levey’s Harvard thesis adviser. Levey’s loyalty to President Bush forced him to go back on his word at least once. The Syrians bent over backward in 2004 to prove to Levey that the Commercial Bank of Syria was not laundering money, as it was accused of doing.  Imad Moustapha and the then newly appointed head of the Commercial Bank, which serves as Syria’s central bank, bent over backwards to cooperate with the US. They invited a team of over a dozen US officials to spend close to a month in Damascus scrutinizing the records of the Commerce Bank, which at the time were still recorded in over-sized ledger books, just as was first done when the bank was established by Khalid al-Azm in the 1950s.

To make a long and extraordinary story short, Levey’s team came home without finding any evidence of money laundering at the Commerce Bank. US lawyers were even allowed by Syria to write a new set of bylaws for the bank to specifically prohibit the sort of transactions the American officials were concerned about. Syria spared no effort to indulge the Americans and demonstrate its good will in cooperating. Finance Minister Hussein came to Washington at the end of the precess to get confirmation from Levey that his office was satisfied with Syria’s cooperation. Levey assured him that he was happy with Syria’s cooperation. Hussein insisted that if Levey or others ever had any further questions, they should call him directly. But only a short time later, Stuart Levey appeared in front of Carl Levin in congress, who asked him about Syria’s cooperation with his department. Levey testified that Syria had not cooperated and that the bank would be sanctioned as a “primary money laundering concern.” The next day Levey explained to Syrian officials, “You cannot expect me to say anything nice about your country in congress when my president says that Syria is a terrorist supporting country?” The following is Levey’s official language:

in [May of 2004], we issued a proposed rule, designating the Commercial Bank of Syria (CBS) as a “primary money laundering concern,” pursuant to Section 311 of the USA PATRIOT Act. The designation was premised on concerns about financial wrongdoing at that bank, including terrorist financing. In connection with the proposed rule, we presented a series of demands to Syrian authorities, ranging from reform of their banking sector to immediate, effective action to cut off the flow of funds across the Syrian border to the Iraqi insurgency.

We will continue to use the tools available to us to press Syria to take concrete actions to address our concerns.

This event taught the Syrians that the Bush administration was hopeless and that there was little benefit in cooperating with it. Syria made further attempts to reestablish proper relations with the Bush White House, and in particular with the Powell led State Department, but to no avail. It increasingly became clear that Powell was being cut out of the loop in Washington and that the US government was going to go after Syria, no mater what Damascus did. Syria forced through the extension of Lebanon’s presidential term several months later and relations between Syria and the US went from bad to worse.

A small aside, Al-Akhbar and other Arab newspapers wrote yesterday that Syria Comment published Hof’s retraction. this was not true.

The Hariri tribunal remains a cloud on the horizon.

Here is how Grant Smith describes Stuart Levey’s office:

Will Obama Break the Law for Israel’s Sake?
by Grant F. Smith in antiwar.com

George W. Bush responded to Israel lobby pressure to target Iran by creating a new U.S. Treasury Department unit by executive order in 2004. The secretive Office of Terrorist and Financial Intelligence (TFI) delivers most of its public briefings at an AIPAC-sponsored think-tank, the Washington Institute for Near East Policy, and even contracts the think-tankers for “consulting.” Like other agencies during the Bush presidency, TFI denied FOIA requests [.pdf] for detailed information about its activities, but it is known to be targeting commercial shippers, international banks, and companies that do business with Iran. Clearly, if this quiet commercial and financial blockade were being waged by some powerful foreign entity against the United States, Americans would consider it a casus belli. But rather than slow or shut the operation down in preparation for promised attempts at U.S.-Iran diplomacy, Obama’s new Treasury Secretary Tim Geithner recently announced that Stuart Levey will continue to lead this financial blockade unit at Treasury. This particular clandestine operations component of Obama’s Middle East policy may soon spark a senseless military conflict with Iran, but perhaps that’s the plan. Obama’s policy, if honestly verbalized, may be the following: As your president, I will continue to deceive you about Israeli nuclear weapons, so that my administration can violate the Symington Amendment and deliver unwarranted amounts of taxpayer dollars to Israel. My administration will negotiate in bad faith with Iran while clandestinely attacking it, in order to preserve Israeli nuclear hegemony in the Middle East.

Treasury’s Levey Says He’ll Stay in Anti-Terror Post
By Alison Fitzgerald

Feb. 1 (Bloomberg) — Stuart Levey, the U.S. Treasury Department official in charge of disrupting terrorist finances, said he has agreed to remain in the job under the department’s new secretary, Timothy Geithner.

Levey, 45, said in an interview that he announced his decision to his staff two days ago after discussions with Geithner and President Barack Obama’s chief of staff, Rahm Emanuel. He was appointed to the newly created post of undersecretary of the Treasury for terrorism and financial intelligence in 2004 by President George W. Bush….

The Treasury division that Levey oversees is a combination of the agency’s executive office of terrorist financing and foreign crimes, the financial crimes enforcement network and the office of foreign assets control. Officials there work to enforce economic sanctions. As undersecretary, Levey aided in the Bush administration’s efforts to flag companies to the financial risks of doing business with Iran, part of measures aimed at pressuring the country to give up its suspected nuclear-arms program….

ICG Report on ‘how to engage Damascus’ (Thanks to FLC for the summary)

“…Set in place effective channels of communication, by:

• nominating an ambassador;
• requesting that Syria treat U.S. diplomats respectfully and doing likewise with Syrian diplomats posted in the U.S.;
• establishing a privileged, personal and direct channel between President Obama and President Assad, possible through Middle East Peace Envoy George Mitchell; and
• conducting a relatively early visit by a high-level U.S. military official in order to establish U.S.- Syrian-Iraqi security cooperation…..

The Bush administration employed three principal tools to alter Syrian behaviour: economic sanctions; multilateral political pressure; and democracy promotion. Some successes notwithstanding, it is difficult to deny that the policy has failed….

Whether March 14’s sense of U.S. disloyalty was justified or not, officials in Washington conceded that events had dealt a severe blow to their allies’ confidence. One went so far as to analogise the situation to the U.S. encouragement of the Hungarian uprising in 1956 or the 1991 betrayal of Iraqi Kurds. There is little dispute that U.S. inaction contributed to March 14’s acceptance of the 21 May 2008 Qatari-brokered Doha accord, which yielded to core opposition demands. In the words of another U.S. official: The backdrop to Doha was that March 14 felt abandoned and had to accept the deal once Hizbollah won. The U.S. was consulted by the Qataris, who constantly asked if the deal was acceptable to us; Rice said it was. Hardliners within the administration held another view, and this is reflected in the very different tones adopted by the State Department and National Security Council in their public statements. State was relaxed, the NSC less so.

Since then, U.S. options in Lebanon have further narrowed. There is no realistic option of confronting Hizbollah, at least in the foreseeable future. Extending support to March 14 remains official policy, but the coalition’s ability to deliver on its earlier promises is in growing doubt. “March 14 is disoriented. Engagement with Syria is taking place and being condoned by the Lebanese government. Even those policy options could become far more complicated should the current opposition prevail in the June 2009 parliamentary elections. While that likely would lead to a new national unity government in which March 14 holds an important number of ministries, including possibly the prime minister – a post traditionally reserved for a Sunni – Washington inevitably would find it more complicated to deal with. Military assistance programs could well come to a halt and institution-building efforts be in jeopardy if Hizbollah were involved, given U.S. legal constraints. Perhaps most significantly, an opposition victory by any margin would strike a psychological and political blow to the March 14 coalition. …….

…..isolation proved short-lived. The first serious cracks were prompted by the 2006 war in Lebanon; more than one Western country concluded that engaging Syria was essential to prevent a far more dangerous escalation.

Prominent Americans, Europeans and Israelis argued strongly for a policy change,123 while European diplomats began visiting Syria at the height of the fighting. In October, the European Parliament called for dialogue, and the UN Special Coordinator for the Middle East Peace Process urged talking to “all parties” involved in the Israeli-Arab conflict. Later that month, UK Prime Minister Tony Blair sent his top advisor, Nigel Sheinwald, to Damascus. Annoying to the Bush administration without being particularly gratifying to the Syrian regime, this ad hoc, uncoordinated European approach yielded little…….. cracks soon were felt within Washington itself. In December 2006, a prominent bipartisan committee headed by former Secretary of State James Baker and former Congressman Lee Hamilton released the Iraq Study Group Report. Among its key recommendations was the need to talk to all of Iraq’s neighbours, Syria and Iran included. ….

The challenge is not merely to close the Bush chapter but to invent a new one.

Bush leaves behind a legacy of additional sanctions and international resolutions that will be impossible to ignore and difficult to undo. Obama cannot simply erase the sanctions, nor will he wish to as they have become an important source of pressure and leverage. For the U.S., the challenge will be to relax them gradually and judiciously, particularly in response to Syrian steps; for Syria, it will be to understand that they cannot be eliminated by an early stroke of a pen and that the country will have to live with these additional constraints for some time to come.

U.S. attitudes have hardened, and official scepticism will outlast the transition. For many in the U.S., including in the new administration, Syria today is associated with actions that led to American casualties in Iraq and to death in Lebanon. That will be hard to erase. A former U.S. official put it as follows: “Syria is a puzzle for the U.S. It remains little known. What is known of it, above all, is its alliance with Iran and the crossborder issue. Syria last was in the news positively, so to speak, eight years ago [when U.S.-mediated peace talks were still ongoing]”. Moreover, the lesson appears to have been learned in the U.S. that the more Syria is courted, the less pressure it feels to act; conversely, only when Damascus senses Washington’s lack of interest in Syria or focus on the Israeli-Palestinian track will it feel compelled to prove its goodwill. This legacy too likely will result in a cautious, go-slow approach.

Promotion of Lebanon’s sovereignty and independence has become a strong, bipartisan U.S. consensus. Unlike in the 1990s, the U.S. is now adamant that Syrian interference in Lebanese affairs or any infringement on Lebanon’s sovereignty cannot be countenanced….. As a result, there would be great resistance toward any step which would have the perceived or actual effect of undermining Lebanon’s sovereignty and strong negative reaction toward Syrian meddling in its neighbour’s affairs.

The proceedings of the Hariri tribunal could interfere with any U.S.-Syrian rapprochement. As a corollary to the above, bilateral ties might well be affected by the tribunal’s finding of Syrian involvement in the former prime minister’s assassination. If Damascus were to reject the court’s legitimacy and, for example, refuse to turn over a suspect, pressure in the U.S. to retaliate and halt any improvement in bilateral relations would be strong. Added to this is the possibility that the findings of the International Atomic Energy Agency’s investigation into Syria’s alleged nuclear program could further contaminate the atmosphere.

The regional context will complicate efforts to normalise bilateral ties. As a result of three wars – in Iraq, Lebanon and most recently Gaza – together with the spread of sectarianism, popular radicalisation and deepening inter-Arab polarisation, there are new obstacles to improved U.S.-Syrian relations and an Israeli-Syrian agreement. Syria has grown closer to states and movements with which Washington wishes it would break, and the regime must closely manage those relations even as it considers policy changes toward the U.S. or Israel. As a result, relations cannot be considered a strictly bilateral affair any more than can Israeli-Syrian negotiations;far more than in the past they are deeply connected with and require attention to a host of complex regional issues…..A rapprochement with the U.S. and peace agreement with Israel necessarily will require the regime to undergo a significant strategic readjustment. This would be hard for it to contemplate under any circumstances given the proven usefulness, durability and reliability of its alliances with Iran, Hizbollah and Hamas. It will be virtually impossible to achieve if the regime lacks a clear vision of what it will receive in exchange.

Traditionally pro-American Arab countries could seek to slow down any rapprochement. This is particularly true of Saudi Arabia and Egypt, both of which are locked in a cold war of sorts with Syria – the former mainly over Lebanon, the latter principally as a result of the Gaza war. In the absence of quick inter-Arab reconciliation, which is improbable as of this writing, Riyadh and Cairo likely will seek to persuade the Obama administration to move very slowly vis-à-vis Damascus and focus chiefly on the Israeli-Palestinian track; Washington – keen to retain its alliances with traditional Arab partners – is likely to pay heed.
Working with Syria to improve the situation in Iraq has become less of a priority. Unlike the pre-surge situation, the U.S. no longer views conditions in Iraq as rapidly deteriorating and in need of a significant corrective.The argument that the U.S. needs Syrian cooperation – central to the Iraq Study Group report – arguably has far less resonance today, despite a far more sympathetic administration, because the situation appears to have stabilised in the interim. Although Obama’s team probably will seek to fashion a regional strategy to ensure a successful withdrawal, Syrian leverage has been reduced substantially. As a U.S. official put it, “we are doing much better in Iraq now and need the Syrians less; in effect, we are succeeding without them”.

Among realistic goals: resuming direct Israeli-Syrian negotiations in the context of a comprehensive peace process; diluting the strategic importance of Syria’s relationship with Iran by strengthening alternative ties (with the U.S., Turkey, France, the UK, the EU); developing trilateral security cooperation between Damascus, Washington and Baghdad; and consolidating achievements in Lebanon (a depoliticised international tribunal)….”

Syria economy: Government secures fresh loans for electricity
Bloomberg, 9 February 2009

The government has secured more than US$600m of fresh loans from the European Investment Bank (EIB) and the Kuwait-based Arab Fund for Economic & Social Development (AFESD) to finance electricity and other development projects. A €275m (US$355m) loan was signed in early January with the EIB to cover some of the costs of the construction of a 700-mw extension to
the Deir Ali power station, south of Damascus. A consortium of Metka of Greece and Ansaldo Energia of Italy was awarded the €650m contract for the combined-cycle plant last year. Philippe de Fontaine Vive Curtaz, the EIB’s vice-president, said during a visit to Damascus on January 19th that he hoped that the bank’s project financing for Syria would increase once the Association Agreement with the EU had been formally signed. An amended text of the agreement was initialled in December. Mr Hussein, the Syrian finance minister, also signed three loan agreements with the AFESD during a visit to Kuwait ahead of the Arab economic summit. They comprised KD45m (US$156m) for an extension to the Deir al-Zour power station, KD16m for a highway to link Deir al-Zour to Bukamal, on Iraqi border, and KD10m for the third phase of the Arab Gas Pipeline.

A Syrian cure to Mideast travails by Sami Moubayed

The much-loathed US-embargo on Syria is weakening, thanks to joint efforts of Washington and Damascus in acting in good faith since the inauguration of US President Barack Obama in January. The initiatives started when Syrian President Bashar Al Assad sent Obama a congratulatory letter on his inauguration, promising cooperation on a basket of Middle East issues, mainly regional peace.

This offer was followed by two back-to-back speeches by the Syrian leader, on BBC and at the Doha Summit over Gaza, stressing that Syria was ready for peace and wanted to cooperate with Obama, for the sake of restoring the occupied Golan Heights to their rightful owners. Al Assad has said he hopes the new US leader will be different from his predecessor.

Last week, the US approved the rehabilitation of two Boeing 747 airplanes on the Syrian fleet, turning a blind eye to the Syria Accountability Act, which prohibits American government and companies from doing business with Syria. The Syrians broke the news, adding through several Syrian websites, that “sources” in the US had confirmed that Obama was reviewing the law.

The Syrians realise that lifting the sanctions at once will be difficult, since it takes time to do away with provisions after they become embedded in US law. The sanctions on Syria are picked from a menu, however, and what can be done is establish a “de-ticking” process in which they are lifted on a gradual basis, in anticipation of removing them altogether.

Another welcome step for the Syrians would be the removal of Syria from the state sponsors of terrorism list. That would be easier, since this does not need Congress, and is related to the State Department. Sending a new ambassador to Damascus is also a must, filling a post that has been vacant since 2005.

In January, a team from the Congress-funded US Institute of Peace (USIP) visited Syria and met Al Assad. It included Ellen Laipson, a former adviser under Bill Clinton and a member of the Obama team, and Bruce Jentleson, an adviser to ex-vice-president Al Gore, who described the meeting in the following words: “His phrasing [Al Assad’s] was 70 per cent of our interests are potentially shared and 30 per cent are not. And he said: let’s work on the 70 per cent.” Shortly afterwards, a senior Congressional delegation landed in Damascus, headed by Adam Smith, a Democratic member of the House Foreign Relations Committee. In a significant remark before leaving Syria, he expressed America’s willingness to turn a new leaf in relations with Syria.

Former president Jimmy Carter is expected in Damascus in the next two months for his third visit in one year, and is to be followed by Obama’s Middle East envoy George Mitchell, after the forthcoming Israeli elections. Another senior delegation is expected on February 17, followed by a high profile visit by Howard Berman, chairman of the House Foreign Affairs Committee.

Clearly, the Americans are seeking solutions to the Middle East crisis through Syria. After many years of deliberate neglect under George W. Bush, the Americans realise that if they want solutions to Hezbollah, Hamas, or Iraq, they need Syria’s help. That doesn’t come without a price as the Syrians have always said and that price would include: removing sanctions imposed on Syria by Bush, starting a dialogue with Damascus, hearing out Syrian worries, and giving Syrians the Golan Heights.

Smaller gestures would be finding a solution to the issue of 1.5 million Iraqis in Syria, and ending the media war against Syria in the Western press, spearheaded previously by the US.

Renewed peace talks are a must, but they cannot be bilateral, either direct or indirect, between Syria and Israel, after what happened in Gaza. The Syrians are waiting to hear of a comprehensive peace plan from the US leader, or as some are putting it, a continuation of the Madrid dialogue, chaired by Obama. They also think that any mention of Syria’s relationship with Iran, Hamas or Hezbollah cannot be a pre-condition for peace talks.

Syrians want to be seen as problem-solvers rather than problem-seekers. They want to show the world – mainly the US – that just as they can deliver on Palestine, they can deliver in Iraq and Lebanon. Former US secretary of state Warren Christopher wrote in The Washington Post about his encounter with Syria in the 1990s and how the country influenced the leaders of Hezbollah to stop the conflicts with Israel in 1993 and 1996. He said: “We never knew exactly what the Syrians did, but clearly Hezbollah responded to their direction.”

The Syrians can still “do things” in the Middle East and Obama seems to understand that well, and is learning fast from the mistakes of his predecessor.

Report: US providing parts for Syrian airline
The Associated Press
Sunday, February 8, 2009

DAMASCUS, Syria: A Syrian government newspaper says the U.S. Trade Department has agreed to provide Syria with spare parts to rehabilitate two Boeing 747 planes out of service for years.

Sunday’s report by Al-Baath newspaper could signal a move by the new U.S. Administration to reach out to Damascus and end an economic embargo of Syria.

Al-Baath quoted Syrian Transport Minister Yarub Badr as saying his ministry received the U.S. approval to repair the two planes two days ago.

An official at the U.S. Embassy refused to comment on the report.

In May 2004, then-U.S. President George W. Bush issued an executive order banning all U.S. exports to Syria except for food and medicine.

Jerusalem Post: Israel may reject Turkish arms request
Jerusalem Post, 1 February 2009

John McGlynn, a correspondent from Japan, writes the following analysis of how Japan and China are changing their attitudes toward the Middle East crisis and US leadership:

IAEA chief Mohamed ElBaradei (as reported recently in Syria Comment, calling out Israel for having “violated the rules of international law”), Prime Minster of Turkey Tayyip Erdogan (who had the now-famous run-in with Israeli President Shimon Peres at Davos), President of the United Nations General Assembly Miguel d’Escoto of Nicaragua (who more than once strongly denounced Israel’s invasion of Gaza and looked for ways the General Assembly could circumvent a weak, toothless Security Council resolution on the Gaza).

It seems the cast of characters critical of Israel, its chief supporter the US and the inadequate reaction of the UN to Israeli/US aggression in the Middle East is now attracting members of the world’s high officialdom willing to be outspoken.

How will the foreign policy hawks that Obama has assembled around him react?

Meanwhile, here in Japan the Democratic Party of Japan (DPJ), currently the opposition but with a solid chance of gaining power in elections required to take place by September, is mulling over a new policy that “would call on the United Nations to press for the withdrawal of U.S., NATO and Pakistani forces stationed in Afghanistan, and establish an international team of truce monitors, including Japan and several Arab countries not involved in the conflict.” (Feb. 2 UPI) Other reports indicate the DPJ favors sending in unarmed peacekeepers to work with local Afghanis. “We will make it clear that this will be different from the past involvement of foreign troops,” a DPJ party member said.

What will become of the “Britain in the East” after the next election?

On the economy, the Jan. 29 Wall Street Journal reports that “Chinese Premier Wen Jiabao squarely blamed the U.S.-led financial system for the world’s deepening economic slump, in the most public indication yet of discord between the U.S. government and its largest creditor.” Without directly naming the US, Mr. Wen “blamed an ‘excessive expansion of financial institutions in blind pursuit of profit,’ a failure of government supervision of the financial sector, and an ‘unsustainable model of development, characterized by prolonged low savings and high consumption.'”

The various crises in the Middle East need diplomatic attention but reports indicate that in her new role of Secretary of State Hillary Clinton’s first trip abroad will be to East Asia to visit China, Japan and South Korea. (Los Angeles Times, Feb. 4)
John McGlynn

Israeli envoy to Australia: Gaza op a ‘pre-introduction’ to attack on Iran
By Asaf Rone
Haaretz, 2 February 2009

The Gaza operation was merely a “pre-introduction” to the challenge Israel would face from Iran, which will become a nuclear power within a year, the Israeli ambassador to Australia said Sunday.

According to Australia’s Channel 7 television, Ambassador Yuval Rotem made the statement at a meeting with leaders of the Sydney Jewish community, having first asked that the cameras be switched off.

While being filmed before the discussion, Rotem said, “The best thing to do is to have a very open dialogue if there are no reporters or journalists here,” before telling the cameraman to stop filming.

“He said that Israel’s recent military offensives were a pre-introduction to the challenge Israel expects from a nuclear-equipped Iran within a year,” Channel 7 reporter Sarah Cummings said. She also quoted Rotem as saying “Israel’s efforts in Gaza were to bring about understanding that we are ready to engage in a decisive way.”

Before the cameras were turned off, Rotem said there was room to build new alliances to face Iran, which he called the strategic threat facing all of us. He said Qatar moved toward Iran in 2009, along with radical Islamic elements, seeming to believe no one will prevent Iran from going nuclear.

Asked to clarify his statements, Rotem said Israel was committed to the diplomatic and economic effort to stop Iran, but that like the Americans, it considers nuclear weapons to be a strategic threat. Uranium enrichment by Iran must be stopped – period, said Rotem.

DJ White House Distances Itself From Dialogue With Iran, Syria
AFP, 2 February 2009

WASHINGTON (AFP)–The White House Sunday sought to distance itself from advisers to Barack Obama who reportedly met with Syrian and Iranian officials during Obama’s transition to power.

“The president made it very clear to the transition team that there would be no contacts with foreign government officials during the transition,” said National Security Council spokesman Mike Hammer.

Obama officially took over the White House Jan. 20, after winning the Nov. 4 presidential election to replace outgoing president George W. Bush.

A group of experts under the auspices of a think-tank known as the United States Institute of Peace announced Thursday that they met for more than two hours in Damascus with Syrian President Bashar al-Assad. The group included Ellen Laipson, a former White House adviser under president Bill Clinton and a member of the Obama transition team.

That meeting took place Jan. 11, said USIP, a bipartisan think tank financed by Congress.
In addition, nuclear non-proliferation experts had several “very, very high-level” contacts in the last few months with Iranian leaders, Jeffrey Boutwell, executive director for the U.S. branch of the Pugwash group, an international organization of scientists which won the Nobel Peace Prize in 1995, said Friday.

Former defense secretary William Perry, who served in Obama’s election campaign, participated in some of these meetings focused on “a wide range of issues that separate Iran from the West: not only their nuclear program but the Middle East peace process, Persian Gulf issues,” Boutwell said….

“Many leading financial institutions have either scaled back dramatically or even terminated their Iran-related business entirely,” Levey said in a March 2007 speech to a conference in Dubai.

Funding Terrorism

“They have done so of their own accord, many concluding that they did not wish to be the banker for a regime that deliberately conceals the nature of its business — too often the business of funding terrorism, and defying the UN Security Council in pursuing a nuclear program,” Levey said in the speech.

Other targeted countries have included Iraq, Syria and North Korea. Sanctions ranged from freezing the assets some companies may have had under U.S. jurisdiction to asking U.S.
banks not to deal with financial institutions accused of helping in the proliferation of weapons of mass destruction and terrorism.

Carsten Wieland predicts that a peace deal between Syria and Israel is possible in 2009. He writes:

Because Syria has the potential to be both problem and solution in the Levant, it remains indispensable to any plan for regional peace and security. At present, the time for successful peace negotiations with Israel is not yet ripe. The protagonists are interested, but not yet strong enough to contemplate the painful compromises and secure the political backing that will be necessary. But the progress made in 2008 may yet survive the destruction and embitterment of the Gaza war, and bear fruit in 2009….

Report: Mughniyeh’s Israeli Killers Infiltrated to Syria from ‘Kurdistan‘
The Israeli daily Yediot Aharonot has said in a report that the assassins of Hizbullah commander Imad Mughniyeh were Israelis who infiltrated from ‘Kurdistan’ into Syria.
The paper said that operational planning for Mughniyeh’s Feb. 2008 assassination started with the arrest of Ali Moussa Daqdouq, a Hizbullah ‘foreign operations’ official, near Karbala, Iraq, in January the same year.

Iraqi security forces later handed over Daqdouq to U.S. intelligence agents who also questioned him regarding Mughniyeh.

The man has reportedly provided the CIA with many details about Mughniyeh, including his phone numbers.

The Americans, according to Yediot, provided the Israeli Mossad with all the information unveiled by Daqdouq.

The paper said that Mughniyeh was assassinated because he committed one big mistake.

The mistake was that several people knew that he would visit Iran’s new ambassador to Damascus, on the occasion of the 29th anniversary of the Islamic revolution on Feb. 12.

The paper added that the Israeli assassination team sneaked into Syria from Iraqi-Kurdistan in three vehicles and monitored Mughniyeh’s move a day before his assassination, including wiretapping his phone line.

According to Yediot Aharonot, the Israeli team reached Mughniyeh’s Mitsubishi Pajero and exchanged the headrest with another loaded with explosives. The Israeli team did not use a time bomb because it feared unforeseen changes.

Once Mughniyeh was seen seated next to the driver’s seat, the headrest blew up by remote control, the paper said.

Yediot Aharonot added that Israel fears Hizbullah and its backer Iran would avenge Mughniyeh’s killing on the first anniversary of his assassination.

Goetz Nordbruch, Nazism in Syria and Lebanon: the ambivalence of the German option, 1933 1945 (London: Routledge, 2009)

The increasingly vibrant political culture emerging in Lebanon and Syria in the 1930s and early 1940s is key to the understanding of local approaches towards the Nazi German regime. For many contemporary observers in Beirut and Damascus, Nazism not only posed a risk to Europe, but threatened to take root in Arab societies as well.

In the first publication to reconstruct Lebanese and Syrian encounters with Nazism in the context of an evolving local political culture and to base its analysis on a comprehensive review of Arab, French and German sources, Götz Nordbruch examines the reactions to the rise of Nazism in the countries under French mandate, spanning from fascination and endorsement to the creation of antifascist networks.

Against a background of public discourses, local politics and the shifting regional and international settings, this book interprets public assessments of and contact with the Nazi regime as part of an intellectual quest for orientation in the years between the break-up of the Ottoman Empire and national independence.

Goetz Nordbruch is assistant professor at the Centre for Contemporary Middle East Studies, University of Southern Denmark, Odense. His research interests include the history of Arab-European relations and the development of modern Arab political culture.

Syria Faces Triple Economic Whammy
AFP, 9 February, 2009

DAMASCUS (AFP) Syria is bracing itself for a tough financial year as drought, falling oil exports and losses by state-owned industries aggravate the impact of the global credit crunch.

Finance Minister Mohammed al-Hussein has admitted the economy faces “a very difficult year” and says the worldwide financial crisis “combined with the drought” which is parching Syria for the third year in a row makes him “very worried” about the outlook.

An economy ministry study forecasts that the credit crunch will cause a 30% drop in foreign investment, along with price increases plus a fall in remittances from Syrians working in other countries, worth $850 million in 2008.

Analysts also highlight the plunge in the price of crude oil, the country’s main source of income, and a fall in all the country’s exports. These sank by half in the final months of 2008 and could weaken again in 2009…

Syrian manufactured products are no longer competitive with goods from China, India and South East Asia, especially following the scrapping of government subsidies, according to Edouard Mkarbne, vice-president of the chamber of trade in the northern city of Aleppo, the country’s economic hub.

The authorities are also worried by the difficult position of state-owned businesses, which are a drain on public finances.

“Of 260 public sector companies, only about 20 generate revenue for the treasury,” Hussein said, highlighting the national oil company, the commercial bank and the telecoms operator. The others make a loss or just break even…

Syria to seek financial sector investment
Middle East Online, 10 February 2009

DAMASCUS – Economic experts have welcomed a statement by Syria’s central bank chief that the government is considering giving foreign investors a chance to buy controlling stakes in financial-sector companies.

“Syria will consider allowing foreign investors to own majority shares in local companies, including banks,” said Adib Mayaleh, governor of Syria’s Central Bank.

“There is a plan for this,” Mayaleh told reporters in mid-January on the sidelines of an Arab economic summit in Kuwait. He did not set out any timeframe for the change.

Economists have interpreted Mayaleh’s comments as a sign that the government is serious about pulling in more foreign investment, especially from Gulf states.

Syrian economy faces ‘very difficult year’
By Roueida Mabardi
AFP, 11 February 2009

DAMASCUS: Syria is bracing itself for a tough financial year as drought, falling oil exports and losses by state-owned industries aggravate the impact of the global credit crunch. Finance Minister Mohammed al-Hussein has admitted the economy faces “a very difficult year” and says the worldwide financial crisis “combined with the drought” which is parching Syria for the third year in a row makes him “very worried” about the outlook.

An economy ministry study forecasts that the credit crunch will cause a 30 percent drop in foreign investment, along with price increases plus a fall in remittances from Syrians working in other countries, worth $850 million in 2008.

Analysts also highlight the plunge in the price of crude oil, the country’s main source of income, and a fall in all the country’s exports. These sank by half in the final months of 2008 and could weaken again in 2009…

Syrian manufactured products are no longer competitive with goods from China, India and Southeast Asia, especially following the scrapping of government subsidies, according to Edouard Mkarbne, vice president of the chamber of trade in the northern city of Aleppo, the country’s economic hub.

The authorities are also worried by the difficult position of state-owned businesses, which are a drain on public finances…

Emerging from economic shadows
By Stephen Glain
The National, 9 February 2009

For years, Zhouheir Yassar Sahloul was the most powerful rogue trader in Syria. As the head of the country’s largest money changer, he was the linchpin between Syria’s struggling, isolated economy and its huge diaspora that remits billions of dollars a year to families back home.

In a country that was saddled with strict foreign exchange laws, it was Mr Sahloul’s agents who ensured Syrian merchants had enough hard currency to do business with partners overseas.
In 2005, when the Syrian pound was on the verge of collapse because of regional political tensions, the Syrian government turned to Mr Sahloul because the country’s central bank lacked the resources to support the currency on its own.

All of this was happening underground. Money changers were illegal but tolerated in Syria, particularly when it came to heavyweights such as Yassar Sahloul and Sons. Ordinary citizens would troop to Mr Sahloul’s offices with plastic shopping bags swollen with banknotes and the authorities would cast a blind eye.

That is changing, however. In recent years, a reformist government has liberalised the Syrian economy and Yassar Sahloul and Sons is now a licensed foreign exchange trader. In June, it will launch an Islamic bank with a Yemeni partner and a capital base of US$100 million (Dh367m). Mr Sahloul hopes that someday Yassar Sahloul and Sons will be the holding company for a diversified concern that will include shipping and property investment assets, as well as banking and finance. Everything will be registered with the government.

“My vision is for a group of companies with the right combination of advisers and a smart board of directors to guide us through investments like real estate development,” he says. “It is important to have outsiders as part of an independent board…”