Syria: Will the Anti-Trust Law Make a Difference?
Joshua Landis
Arab Reform Bulletin: May 2008

On April 4, Syria issued its first Competition and Anti-Trust Law (Law No 7/2008), which some observers consider a significant marker on the road from a planned to a market economy. The anti-trust legislation follows on the heels of several new laws issued over the past months, including a new commercial law, an incorporation law, and an arbitration law, replacing old ones dating to 1949. All are designed to open the way for private investment, including foreign investment, and to bring Syria into line with international legal and business practices.

Kanaan al-Ahmar, the Syrian attorney who played a large role in drafting the anti-trust law (click here for the entire text in Arabic), told editor Jihad Yazigi of The Syria Report (Syria’s top economic digest) that the Competition and Anti-Trust law has five main provisions:

• Market prices are to be set by free competition, with the exception of some specified cases. Al-Ahmar notes that until now the government set prices and issued occasional regulations to liberalize them; now it is the other way round.
• Cartels and other agreements, whether written or oral, which could disrupt free competition in the market are prohibited.
• No economic entity may abuse its dominant position in the market.
• Traders and manufacturers are prohibited from imposing minimum prices for the resale of their products/services, from selling below cost, or from disrupting supply to the market (in order to drive up prices).
• The law establishes a Competition Council that must give permission for any merger or acquisition that leads a company to hold a market share of over 30 percent for any product or service.

But no law is better than the authority that oversees and upholds it. Yazigi explains that “the text of the anti-trust law is as good and modern as any equivalent law in another country. Syria’s business environment has been significantly improved by this and the other laws promulgated recently. However, implementation will be a problem; one should not expect too much in the short-term. Most members of the body in charge of overseeing its implementation are appointed by the government. In other words, it is a very good law that will require political reform before it works as efficiently as it is meant to.”

The government will completely control the thirteen-member Competition Council that will monitor the law’s implementation. Serving at the pleasure of the prime minister, the body will include eight financial and legal experts selected by various ministers and heads of government financial commissions, three businessmen selected by the Federations of Chambers of Commerce, and two unionists, one from the General Workers Union and another from the Peasants Union.

Among the key questions about the implementation of the new law is how, if at all, it will apply to industries currently dominated by the state. One Syrian businessman, a Wall Street executive who has numerous interests in Syria, said “It is not monopolies within the private sector that bother us businessmen; it is the state monopolies. The state owns some 250 different businesses of which only eight or so are profitable. They belong to the telecom and petroleum industries. The others are almost all dogs and produce tires, beer, biscuits, bottled water, cigarettes…the list goes on. Every businessman I know wants to get into these fields; there is good money to be made, but the state has to give up its monopolies first.”

At the same time, despite their continuing frustration at the slow pace of change and continuing heavy hand of the state, many Syrian businessmen believe that the government is on the right track. “If Bashar has done one thing, he has changed some of the archaic and idiotic laws,” one businessman said. President al-Assad also has opened up several strategic industries—banking, insurance, and advertising—to private capital. Investor response in these industries has been very good. Initial public offerings (IPO) of banks entering into the Syrian market have been oversubscribed. When Bank Audi entered the Syrian market in 2005, its IPO was oversubscribed by a massive 988 percent. Fransabank, the newest entrant into Syria just had its IPO in March, which was oversubscribed by 250 percent of the value of the offering.

The success of the financial sector has whetted the appetite of regional investors. And while it is not clear how well the new anti-trust and other laws will be implemented, they are already succeeding in creating the impression that Syria has become investment friendly. Still, business people are savvy about the risks in such an uncertain environment. A recent proposal for a $50 million venture in Syria began with the caution: “This proposal is being offered to sophisticated investors who could, in the worst case, afford to sustain the loss of their entire investment.” Investing in Syria is not for the faint of heart.

Joshua Landis co-directs the Center for Middle East Studies at the University of Oklahoma.

InterContinental Hotels Group (IHG) signs agreement to develop its first property in Syria with the M.A. Kharafi Group

Dubai, 11 May 2008: InterContinental Hotels Group (IHG) has signed an exclusive agreement with MAK Hotel Holdings, a member of the M.A. Kharafi Group of Kuwait, to develop an InterContinental Hotel in the Syrian capital.

Located in the city centre, the 370-room InterContinental Damascus, due for completion in 2010, will form part of the capital’s only integrated development which will include a shopping mall, cinema complex and office space.

Targeted at the luxury leisure traveller, InterContinental Damascus will be the perfect starting point for those keen to explore the areas historic sites, known to be one of the oldest continuously inhabited cities in the world.

John Bamsey, Chief Operating Officer — "Over the last few years we have witnessed a substantial increase in tourism levels to Syria; our aim is for IHG to be at the forefront of this demand for accommodation."

Mohamed Fahmy, Managing Director of MAK Hotel Holdings, commented: “This is an exciting development for our group and we are thrilled to be working alongside IHG to deliver an exceptional InterContinental branded hotel in the heart of Damascus. There is great investment potential throughout Syria and we look forward to expanding our portfolio within the region.”

DAMASCUS, May 8 (Reuters) – Worse than expected weather will plunge Syria's wheat production to a nine-year low this year and the government may use its strategic reserve to help meet domestic needs, a senior agriculture official said on Thursday.

Syria is a major food and farm commodities player in the Middle East and a traditional exporter to Egypt and Jordan.

Food security is a cornerstone of the Baath Party led government, which is confronting a U.S. led drive to isolate it after Washington imposed sanctions on Syria in 2004.

Output of wheat, which will start to be harvested next month, is expected to fall to 3 million tonnes compared to a planned 4.7 million and 4.1 million tonnes last year, Mohammad Hassan Katana told Reuters in an interview.

Production of barley will fall to 200,000 tonnes this year compared with 784,000 in 2007 and 253,000 tonnes in 1999, the lowest on record, he added.

"We have had a massive deterioration in weather conditions this year. It is one of the worst on record," said Katana, who heads statistics and planning at the Agriculture Ministry.

"Most of our production will come from irrigated areas that have been hit by lack of rain," he added.

The year started with 55 days of frost, which delayed growth of wheat and barley, and this was followed by unseasonably scorching weather in April that finished chances of harvesting areas fed by rain, he said.

Rain-fed areas account for around one third of Syria's cereal production. Rain was 40 percent below normal this year and this resulted in a 20 percent drop in yield in irrigated areas, Katana said.

This year's wheat output, expected to be the worse than the 2.5 million tonnes in 1999, will be enough to cover demand for bread but not for flour used in pastries and other food, he added.

But Katana said wheat security, a pillar of strategic policies, will remain intact due to large reserves Syria has built over the years.

"We have the strategic reserve to use in these circumstances. It has been built for such scenarios," he said.

UNHCR signs landmark accord in Syria with international NGO

US extends Syria sanctions

WASHINGTON (AFP) — President George W. Bush said Wednesday he was extending US sanctions against Syria following Washington's charge that Damascus had been building a nuclear reactor with North Korea's help.

Bush announced his decision to continue for one year a freeze on Syrian assets and the ban on the export of certain goods to Syria in an executive order and a message to the US Congress.

"I took these actions to deal with the unusual and extraordinary threat to the national security, foreign policy, and economy of the United States constituted by the actions of the Government of Syria," Bush said in the order. He accused Syria of "supporting terrorism … pursuing weapons of mass destruction and missile programs including the recent revelation of illicit nuclear cooperation with North Korea." The US president also said Syria was "undermining US and international efforts with respect to the stabilization and reconstruction of Iraq."

Bush initially slapped sanctions on Syria in May 2004, then extended them in April 2006 and widened them in February to target officials engaged in "public corruption," amid charges Damascus was destabilizing Iraq and Lebanon.

Last month, US national security officials presented intelligence they said showed Syria had been building a secret nuclear reactor for military ends….

Syria denied the US allegations, promised full cooperation with the UN watchdog, and accused the United States of a "campaign of lies" akin to US charges that Iraq had a weapons of mass destruction program.

Syria: Atomic Agency Seeks Answers
By REUTERS, May 8, 2008

Mohamed ElBaradei, the director general of the International Atomic Energy Agency in Brussels, said Syria had an obligation to tell his agency whether the site Israeli warplanes bombed there in September was an undeclared nuclear reactor. The government in Damascus has not granted United Nations inspectors access to the area despite several requests, diplomats say. The United States released intelligence last month that it said showed that Syria had built a reactor at the site. The Syrian government has denied the accusations.

Purchases Linked N. Korean to Syria
Pyongyang Company Funneled Reactor Parts to Damascus, Intelligence Officials Say
By Robin Wright and Joby Warrick
Washington Post Staff Writers
Sunday, May 11, 2008; A18

When North Korean businessman Ho Jin Yun first caught the attention of German customs police in 2002, he was on a continental buying spree with a shopping list that seemed as random as it was long.

Yun, police discovered, had been crisscrossing Central Europe, amassing a bafflingly diverse collection of materials and high-tech gadgets: gas masks, electric timers, steel pipes, vacuum pumps, transformers and aluminum tubes cut to precise dimensions.

Most of these wares Yun had shipped to his company's offices in China and North Korea. But some of the goods, U.S. and European officials now say, were evidently intended for a secret project in Syria: a nuclear reactor that would be built with North Korean help, allegedly to produce plutonium for eventual use in nuclear weapons.

According to U.S. officials, European intelligence officials and diplomats, Yun's firm — Namchongang Trading, known as NCG — provided the critical link between Pyongyang and Damascus, acquiring key materials from vendors in China and probably from Europe, and secretly transferring them to a desert construction site near the Syrian town of Al Kibar.

It was the company's suspicious buying habits — and the branch office it opened in Damascus — that inadvertently contributed to the alleged reactor's discovery and later destruction in a Sept. 6 Israeli bombing raid, U.S. officials say. Joint Chiefs of Staff Chairman Michael Mullen declined in an interview to say whether Washington helped with the raid, but he strongly endorsed it.

"The reactor which was being built was not very far from being operational and needed to be hit," Mullen said.

Only through the sights of its guns
By Zvi Bar’el
Tags: Lebanon, Hezbollah

Nasrallah’s rhetoric in the internal Lebanese dispute is not the important point, but it does once again portray Hezbollah not as an opposition organization, but as a force competing with the Lebanese army. Nasrallah comes off as someone who intends to rack up all the political achievements he feels he deserves. It seems he will not rest until the current Lebanese government is gone, to be replaced by a unity government in which his supporters have veto power over important decisions. Thus, while Israel continues to view Hezbollah as nothing but a militant organization that can be crushed by a military operation, it is ignoring the possibility that Lebanon will shortly be run by that very organization. In effect, one can say even now that the person running Lebanon’s domestic politics is Nasrallah – no less, and perhaps more so, than the government.

Seeing Hezbollah solely as an organization is quite similar to Israel seeing Hamas as an organization, while ignoring the public foundation on which both groups rely. The result is that Israel prefers to stick with counting Hezbollah’s Katyusha rockets, or Hamas’ Qassams, as the sole index of the threat those groups pose. In order to intensify the threat, Israel terms both organizations as “Iranian,” thereby fulfilling its obligation to issue an alert.

There is no argument over the fact that the amount of missiles and rockets is not just a potential threat – both organizations use them against Israeli targets. But the way that Israel has dealt with these groups thus far proves that military solutions alone are not practical. Hezbollah was not weakened by the Second Lebanon War. Instead, the war made it even stronger, both militarily and politically. And the military offensives in Gaza have not made much of an impression on Hamas, which holds the key to continued political negotiations.

In both cases, Israel has a political alternative. If it so greatly fears Iran’s expansion into the Mediterranean, Israel can advance talks with Syria, and if it is concerned by a Hamas takeover of the political process, Israel would do better to move forward with negotiations with the Palestinian Authority – or at least to create conditions in Gaza to relieve the threat posed by Hamas. Israel sees the political threat developing in Lebanon and in the territories, but is prepared to respond only through the sights of its guns.”

Shai writes: This is the kind of freedom of speech Israelis enjoy (thank god):

Let's be done with all the Talanskys 
By Gideon Levy in Haaretz

….. Revealing the identity of the primary witness, Morris Talansky, in the lastest Ehud Olmert affair raises questions that go beyond the prime minister. Serious questions need to be asked about the relationship between American Jewry and Israel.

Granted, Talansky is a mere individual, but he is not the only one. Jerusalem is full of wheeler-dealers, functionaries, lobbyists, donors and philanthropists. There are rich men and middlemen, envoys and delegations, many of them with good intentions, but some without.

They wheedle and schnorr and contribute to various causes. It's the kind of schnorring that begins with Shaare Zedek Medical Center and could end in court. The question here is why did Talansky, or any other Jewish American, invest, allegedly, in Olmert? What do they receive in exchange for this pot stirring? 

Honest Patriot said:

Offended, you may have been sarcastic in your post but I, for one, believe that item (4) is on the agenda the moment HA is back in or becomes the government.
4- Revoke all government decrees regarding the Hariri tribunal and deport the UN investigative team.

SHAMI said:

Dr Joshua, many recent studies have proved that the Sunni community in Lebanon is a little more numerous than the Shia community but they remain very close and if you add the 500 000 Palestinians there will be a clear Sunni majority in Lebanon, even if they are not Lebanese nationals but we should take them into account as permanent or i hope long term inhabitants, I would prefer that our Palestinian brothers of Lebanon became Syrian citizens if they can not go back to their home Palestine.

Likely the Muslims in Lebanon are today 60% of Lebanon population, it’s important for me as Syrian Muslim that Lebanon remain a country with a christian character and we should be honest that what make Lebanon so different it’s this liberal westernized character.

Qifa Nabki said:

Another day, another opportunity for politicians to ruin our lives.

Let’s see if we can make a few predictions.

The government will NOT resign.

Gemayel, Geagea, and Jumblatt will continue issuing meaningless statements about coups and hands outstretched in dialogue. Hariri will reluctantly play along, while loudly ruling out the possibility of fitna.

Aoun will keep his head low.

Nasrallah will be magnanimous, as he always is, leaving the shamateh to his pet parakeets, Naim Qasim and Wiam Wahhab.

Washington will throw some more sanctions on Syria and underline Hizbullah’s name on the top 10 terrorist organizations, then use a yellow highlighter to make it seem really bold and striking, and then maybe erase it and write it out in all CAPS.

In short, we will limp along as usual. Let’s hope otherwise?

Mideast reels as hunger outgrows oil earnings

In spite of record oil prices, food security across the region has reached a precarious point, with cereals imports expected to reach $22.6bn this year – May-07

 "One of Barack Obama’s Middle East policy advisers disclosed yesterday that he had held meetings with the militant Palestinian group Hamas – prompting the likely Democratic nominee to sever all links with him…."

Reem Allaf has written an excellent satirical piece on Syrian's use of the Web.

Idaf responds to Reem's article:

You should try to coordinate with these people for the embassies. It's the core of an e-government project in Syria. Most official information on government applications are listed here (with lots of forms to download and contacts to government entities):

http://www.e.sy/

http://www.e.sy/

This is a project under the Syrian Computer Society's e-government portal project (http://www.esyria.sy) that was first initiated in a jointly supported conference last year by the EU & the Syrian government. This year's e-Government Conference in Syria is scheduled next month. More information here for those interested: http://www.esyria.org/en/

http://www.esyria.sy) that was first initiated in a jointly supported conference last year by the EU & the Syrian government. This year's e-Government Conference in Syria is scheduled next month. More information here for those interested: http://www.esyria.org/en/A muhafaza in Syria now has its own official portal (they are linked from the portal above). Following up on Rime Allaf’s excellent article posted in the comments section above, the official portal of Al-Qunaytra governate (http://www.equnaytra.sy/) lists the following 3 websites on the Golan:

– The http://www.golan-gov.org.sy/"rel="nofollow" official Syrian website for Golan (Arabic, English and French)

– A community website for http://www.golan67.com/"rel="nofollow" Syrians living under occupation in the Golan (managed from the occupied Golan)

– The website of the <a>Committee for Defense of Syrians imprisoned by Israel in the Golan</a>