Syria's Assad seeks investment in Latin America

Eye on potential Syrian expatriate investment


President Bashar al-Assad will make a rare visit to Latin America aimed at extending Syria's diplomatic reach after emerging from Western isolation, and attracting investment for his country's ageing infrastructure.

Assad, who faces a decline in domestic oil production and droughts that have hit agriculture, will be looking to reinforce links with a rich Syrian expatriate community in the region and with economic power Brazil.

Official Syrian media said Assad will travel to Brazil, Cuba, Argentina and Venezuela, without giving a timetable. He is expected to arrive in Venezuela later on Friday.

"Brazil is a rising power and Syria is aware of this. The president's visit will help convince the Syrian expatriate community to begin investing in Syria," said Thabet Salem, a Syrian journalist and commentator.

Brazil, together with Turkey, brokered a deal with Syria's ally Iran for Tehran to send abroad low-enriched uranium in return for reactor fuel. The deal did not stop the United Nations Security Council from imposing a fourth round of sanctions against Tehran this month, which Brazil opposed.

Eye to Eye

Diplomats in Damascus said while Syria agrees with Brazil's efforts to solve the impasse between Iran and the West, Assad's visit will be more focused on bilateral issues and Syria's hopes to attract $44 billion in private investment over the next five years to repair its infrastructure.

That figure represents 80 percent of Syria's gross domestic product, which is a fraction of Brazilian output.

Brazilian parliament speaker Michel Tamer said the two sides will sign trade and technology cooperation protocols. Brazil already supplies Syria with most of its sugar.

"The Arab expatriate community has an economic and cultural weight that will help expand cooperation with Syria on the government level," Tamer told the official Syrian news agency.

Jihad Yazigi, publisher of the Syria Report economic newsletter said while Syrian expatriate investment is minimal, Syria stands to gain from shifting global economic trends in favour of Latin America.

"The south-south cooperation is interesting in the context of the relative decline of the West," Yazigi said.

"Venezuela may be a poor country but it has oil and is supporting anti-U.S. sentiment. What Syria gets out of this could be an asset," he added, pointing two visits to Syria in the last four years by President Hugo Chavez, one of Washington's most vocal critics.

Syria has welcomed overtures by U.S. President Barack Obama for detente with Damascus, but has rejected U.S. calls for it to cut its links with Lebanon's Shiite Hezbollah movement or Palestinian militant groups.

The Arab expatriate community has an economic and cultural weight that will help expand cooperation with Syria on the government level

Brazilian parliament speaker Michel Tamer

Venezuela and Iran had announced plans to build a refinery in Syria, but the project remains confined to paper, with Iran unable to solve its own shortage of refining capacity.

Syria, whose population of 20 million people is rising by 2.5 percent a year, imports most of its gas oil needs.

Its crude oil production is also declining, with Syrian oil minister forecasting production to fall to an average of 340,000 barrels per day over the next 15 years compared with a 590,000 bpd peak in 1996.

Yazigi said Syria, which is one of a few Middle East countries with a manufacturing base—albeit in need of overhaul—could learn from the experience of Brazil, one of the "Brics" comprising Russia, India and China.

"Syria's ties are good with all the Bric nations, which still have an important manufacturing sector," Yazigi said.

The International Monetary Fund forecasts Syria's economy to grow 5 percent this year, compared with 4 percent in 2009 and 5.2 percent in 2008. But consecutive droughts in Eastern Syria have displaced up to one million people.

Under Assad, who succeeded his late father in 2000, the Syrian state has sought to attract foreign investment and shed a legacy of a closed economy and bans on private enterprise under the Baath Party, which has ruled Syria since 1963.