Syria
Following the breakup of the Ottoman Empire during World War I, Syria was administered by the French until independence in 1946. In the 1967 Arab-Israeli War, Syria lost the Golan Heights to Israel. Since 1976, Syrian troops have been stationed in Lebanon, ostensibly in a peacekeeping capacity. Talks with Israel over the return of the Golan Heights have recently been revived.
While there are no known credible direct threats to expatriates or visitors, the recent military action by U.S. and British forces in Iraq have raised the prospect that individuals or organizations could carry out terror attacks against western interests or personnel. Residents and visitors should exercise caution and take prudent measures to maintain their security. These measures include being vigilantly aware of surroundings, avoiding crowds and demonstrations, keeping a low profile, varying times and routes for all travel, and ensuring travel documents are current.
In addition, visitors should avoid contact with any suspicious, unfamiliar objects, and to report the presence of the objects to local authorities. Vehicles should not be left unattended, if at all possible, and should be kept locked at all times.
On June 10, 2000, President Hafiz al-Asad died, and was replaced by his son, Bashar al-Asad, who promised to undertake a variety of economic, administrative, and political reforms. Also since the death of Hafez al-Assad, Syria has undergone a degree of relaxation, which has seen dozens of political prisoners released. But observers wait to see if the country will be able to maintain the stability of the last 30 years.
Bashar al-Asad has issued several decrees and laws aimed at establishing a Damascus Stock Exchange, legalizing private banks, attracting foreign investment, and harmonizing Syria's various (official, neighboring country, and promotions) currency exchange rates. The ultimate goal of such reforms is to move Syria towards a more market-based, modernized economic system. In recent years, Syria has moved extremely slowly and cautiously in this direction. For the most part, however, as of early 2002, large state corporations continue to control all strategic sectors, including oil, electricity, banking, and chemicals. In December 1997, Syria decided to begin negotiations with the European Union (EU) regarding a possible association agreement. This agreement could take many years to conclude, and will require significant changes in the Syrian economy. In January 2000, a EU delegation urged Syria to carry out real economic reforms and offered Syria the possibility of an association agreement with the EU. Currently, the EU is Syria's main trading partner, buying more than half of Syria's exports. In December 2000, the EU and Syria held their fifth round of negotiations on an Association Agreement. Issues include providing EU companies preferential access to the Syrian market, and to facilitate EU investment in Syria.
Following two years of recession caused by low oil prices and a severe drought, Syria's economy resumed growth in 2000, while inflation remained subdued. For 2000, Syria's real gross domestic product (GDP) grew by 1.5%, with consumer price inflation at 0.5%. Sharply higher oil prices (and, consequently, an oil export revenue windfall) and a recovering agricultural sector were the main factors in this turnaround. Real GDP growth is expected to reach 4.2% in 2001. With its rapidly rising population (around 2.5% per year), however, it is estimated that Syria needs real GDP growth of close to 5% annually in order to make significant economic progress. Syria's largely state-owned economy continues to be hurt by low investment levels, fiscal imbalances and distortions (such as subsidies), an overvalued currency at the fixed exchange rate (for "essential" transactions), high levels of foreign debt, a hard currency shortage, falling exports, and other problems, including rapid population growth rates. According to the Syrian government, the country's unemployment rate is under 10%, although according to foreign diplomats, the rate is more likely over 20%. In August 2000, the Syrian government announced that it would increase salaries for employees in the country's large public sector by 25%.
In 1991, Syria passed Investment Law No. 10, encouraging foreign and Syrian private investment through a combination of tax and custom exemptions, the right to repatriate profits and relaxation of foreign exchange controls. Private investors, with financial backing from the Gulf States, have been expanding into various sectors of industry. This has encouraged the development of textiles, pharmaceuticals, food-processing and other light industries, many built by wealthy Syrians from abroad. Tourism appears to be growing as well. Still, along with agriculture, foreign aid and remittances from Syrian workers abroad, Syria relies heavily on the oil sector -- for around 65% of export revenues, for instance.
Syria's relations with Iraq have improved significantly over the past few years. In June 1997, Syria reopened its border with Iraq for businessmen, and since then a series of trade delegations has traveled between the two countries. On July 14, 1998, Syria and Iraq signed a memorandum of understanding on reopening an important oil pipeline -- closed in 1982 -- from northern Iraqi oil fields to Syria's Mediterranean port of Banias (see below for more details). On February 27, 2000, Iraq opened an interests section in Syria -- the first direct bilateral diplomatic link in over 19 years. On January 31, 2001, Syrian Prime Minister Mustafa Miro and Iraqi Vice President Taha Yassin Ramadan (the highest Iraqi official to visit Damascus in 20 years) signed a free trade agreement. Currently, trade between the two countries is estimated at around $500 million. Also, Syria and Iraq announced that they had worked out a plan for sharing waters from the Tigris and Euphrates rivers. The two countries urged Turkey to join them in a tripartite agreement.
Syrian security personnel may at times place foreign visitors under surveillance. Hotel rooms, telephones, and fax machines may be monitored, and personal possessions in hotel rooms may be searched. Taking photographs of anything that could be perceived as being of military or security interest may result in problems with authorities.
In June 2001, Syrian troops evacuated Beirut and redeploy in other parts of Lebanon, following pressure from Lebanese critics of Syria's presence.
