Iran's Private Sector Prepares to Secure Syrian Market Entry - Report

EghtesadOnline: Scores of Iranian executives running private businesses converged on the Tehran Chamber of Commerce, Industries, Mines and Agriculture on Saturday to meet their Syrian counterparts and secure a foothold in a market that is now ripe for business after years of conflicts.

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21 October 2018

TCCIM, a major private sector representative, hosted a 50-strong Syrian business delegation as part of a business and investment conference. Top members of the delegation included the Arab republic's Ambassador to Iran Adnan Hassan Mahmoud and prominent businessman Muhammad Hamsho, who now acts as the secretary-general of the Federation of Syrian Chambers of Commerce.

Hamsho, who has years of experience in Syria's business community and close ties to the government of Bashar Al-Assad, emphasized that Iran and Syria's economic ties need to expand to match their political relations, vowing that the business community will use the full extent of its power in this regard.

"We have found that there is a fundamental willingness from traders of both countries to develop Iran-Syria economic ties," Financial Tribune quoted him as saying.

> Reconstruction of Syria

One of the main topics of discussion was the prospects of rebuilding Syria. The country's infrastructures have taken a serious beating due to years of war and efforts to cast out the self-styled Islamic State terrorists.

Since its onset in 2011, the war has cost Syria approximately $388 billion, according to the United Nations' Economic and Social Commission for Western Asia.

"Considering Iran's cooperation and participation in combating terrorism, the Islamic Republic is a priority for rebuilding Syria," Hamsho told the gathering on Saturday.

The businessman said Iran and Syria can establish joint ventures in transit, banking, contract work and manufacturing projects, among others.

Hamsho noted that free trade zones can be tapped as a major avenue for developing trade and economic ties. He also called for organizing joint exhibitions both in Syria and Iran for boosting trade by better introducing goods produced in the respective countries.

As conditions in Syria have begun to regain relative stability in recent months, Iran has been quick to position itself at the forefront of rebuilding the Arab nation. In late August, Iranian Defense Minister Amir Hatami met his Syrian counterpart Ali Abdullah Ayyoub in addition to Bashar Al-Assad and committed to having "presence, participation and assistance" in reconstruction.

Tehran has provided steady political, financial and military backing to Assad during the war that is now in its eighth year.

TCCIM President Masoud Khansari said during the Saturday conference that the chamber's studies show there is immense room to boost bilateral economic ties.

"We hope to play a vital role in rebuilding Syria today, as we stood next to the people of Syria during the war," the business representative said, adding that Iran can export engineering and technical services to the Arab nation, import goods and use Syria as a gateway for exports to other Arab countries.

> Using National Currencies, Banking Channels

Hassan Danaeifar, the head of Iran’s Headquarters for Expanding Economic Ties with Iraq and Syria, pointed out that much has changed in the past eight years when some harbored thoughts of regime change in Syria.

Now that relative stability rules the country, he added, economic development must ensue.

"The $160 million worth of trade [per year] between the two countries is very low and indefensible for both," said the official, who also acts as a top advisor to First Vice President Es'haq Jahangiri.

He pointed out that Iran and Syria have no joint financial avenues. Danaeifar announced that Iran is ready to engage with Syria in a variety of ways, such as employing national currencies in trade to mitigate risk, and said the Central Bank of Iran has agreed to discuss the establishment of bank branches on its agenda.

"Establishing an Iran-Syria Chamber of Commerce is also on the books," he said.

> Diplomats Vow Closer Ties

In the conference, the Syrian ambassador to Iran said leaders of both countries are keen on developing economic ties within the framework of continuing their strategic partnership.

"The Syrian government at this stage has given priority to its allies, especially the Islamic Republic, as those who supported terrorism in Syria and destroyed its economy will have no place in it now," he said, adding that Syria's doors are open to Iranian businesspeople interested in rebuilding the country.

"Syria invites Iran's private sector to make investments in economic projects and will use everything within its power to provide the interests of both countries," the ambassador said.

Mahmoud called on business representatives to mobilize a free trade agreement previously clinched between the two nations and vowed that Syria will be working to alleviate hurdles, including banking barriers.

Iran's Ambassador to Syria Javad Torkabadi said even though many tried to silence the truth with guns, they failed and now Syria is once more on its way up.

"There are many areas of economic activities in Syria that provide exceptional windows of opportunity for Iran to rebuild Syria," he said, adding that the economies of the two nations can now complement each other.

The ambassador asked the diplomatic and business representatives present at the event to prepare the grounds for more such gatherings in the future with the ultimate aim of creating "a powerful economic region".

> Eying Turnaround in Weak Trade

Even as political ties between Iran and Syria have been close for years and Iran is counted among the chief supporters of the Al-Assad government, the two nations have never been successful in realizing their true trade potential.

Bilateral trade had risen to $545 million just as the Syrian war was commencing during the fiscal 2010-11, official data by the Trade Promotion Organization show.

Iran-Syria trade dwindled afterwards, though trade balance has favored Iran.

During the previous fiscal year that ended on March 20, 2018, Iran exported $172 million worth of goods to the Arab republic and imported $13 million in return.

Figures for the first five months of the current fiscal year that ended on Aug. 22 indicate that trade ties may now be weakest in a long time since Iran exported only $31.6 million worth of goods and imports from Syria reached $1.3 million.

The dozens of business representatives and officials that gathered in Tehran on Saturday hope they can turn things around. After the ceremony and speeches, business representatives sat down for extensive B2B talks.

In conclusion, TCCIM Secretary-General Bahman Eshqi signed a memorandum of understanding with his Syrian counterpart Muhammad Hamsho aimed at boosting bilateral commercial ties.