Syrian Dream

Former German chancellor Gerhard Schroeder is leading calls for greater investment from both the Arab world and the West in Syria. After attending last week’s second Syrian-Emirati economic forum, he spoke to Anil Bhoyrul in Damascus.

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By  Anil Bhoyrul Published  June 18, 2006

|~|28-Shroeder-200.jpg|~|Support: Schroeder has backed Syrian reforms.|~|Former German chancellor Gerhard Schroeder is leading calls for greater investment from both the Arab world and the West in Syria. After attending last week’s second Syrian-Emirati economic forum, he spoke to Anil Bhoyrul in Damascus. As the cameras start clicking, Gerhard Schroeder starts smiling. “Hmmm. Let’s see now, what have we here. A Japanese camera, heh? Not German? This is your first mistake,” he says. He should know. The former German chancellor has made few mistakes in his political career, but ironically it is now – less than six months since leaving office – that he faces his biggest challenge. Having received a near hero's welcome in Damascus, as guest of honour at the second Syrian-Emirati Economic Forum, Schroeder is now making good on his promise to help deliver not just a message of peace, but billions of dollars in the form of investment from the West to the Arab world. “It is my firm conviction that Syria must become more strongly integrated with the world economy… I am confident that with the Syrian course of modernisation gathering momentum, European investors will become more courageous,” he says. So far, the omens are good. Last month, the Syrian parliament adopted an ambitious plan that will, if successful, have dramatically changed the Syrian economy by 2010. Whilst Damascus today – as with the rest of the country – shows few visible signs of economic progress, the Syrian Parliament has been studying carefully the explosive growth of Dubai. It helps that Emaar chairman Mohammed Alabbar has set aside nearly US$2 billion of the company's cash for developments in Syria, with plenty more likely to come. Alabbar and Schroeder are both now actively promoting Syria as a new hotbed of growth. Schroeder says: “It is common knowledge that a social market economy can only be truly and sustainably successful when it is rooted in a strong, open civil society. That is the environment most likely to promote private business initiative. The new approach to economic policy is already showing the first signs of success: just look at Syria’s growth rate and increase in foreign investment.” The former German leader deserves some personal credit for that, having long been a “friend” of Syria. During his time in office, Schroeder led a number of financial initiatives between the two countries, and also helped establish a joint university in Syria. He says: “It is good to now see that partners in the region, such as the United Arab Emirates, are sharing the burden of responsibility. The predominantly applies to the areas of finance, real estate and tourism. But the modernisation of the country’s industrial basis also requires further investment. “I am confident that with the Syrian course of modernisatiion gathering momentum, European investors will become more courageous.” The change in the Syrian economy is already visible in terms of the numbers: whereas in 2000 the growth rate was negative at minus 1%, today it stands at 4.5%. In the non-oil sectors it is as high as 5.5%. Significantly, private investment in the country has soared by 25% over the past twelve months. Schroeder says: “The economic data is very positive and foreign investors especially from the Arabic region are very active here. “I think that if the economic reform process, which the government has started is continued, there will also be more investors from Europe. “The potential for cooperation is not exhausted yet. There is a clearly noticeable upward trend in the financial, real estate and tourism branch. This is the impression I got during the forum. “The modernisation of certain local industries, especially the textile and chemical sectors require further investment. These areas represent huge potential for investors and international cooperation.” But the former German leader knows there is still work to be done. He explains: “During the discussions at the forum it became clear that bureaucracy still has to be reduced further. Also, some legal areas have to continue to change so that foreign investors have an easier time. It is important that, parallel to the economy, the society as a whole is opened further. This is very important because as we know a private economic engagement can only be successful if built in an open and strong civil society.” The forum was a chance for many senior business leaders from both Syrian and the UAE to exchange ideas on further growth. It is a chance they didn’t miss. H.E Abdullah Al Dardari, deputy prime minister for Economic Affairs in Syria, says he is confident that the upward trend will continue. “I think the share of private investment will only increase. But we need more than US$20 billion of private investment in Syria over the coming five years, and that is top of the US$20 billion of public investment already being made.” Al Dardari adds: “The bottom line is we want to create 1.25 million jobs in the next four years. We have created 200,000 jobs in one year but there is still high unemployment in Syria. What we must do is strike a balance between providing jobs to Syrians and also importing the skilled labour that we need. It is why this second Syrian-Emirati forum is so timely, because we cannot move forward without investment from our friends in the Arab world and Germany.” Syrian economists have been looking closely at the Dubai example, and in particular the emirate’s explosive growth over the past decade. Relations between the UAE and Syria are extremely strong – as shown by the presence at the forum of not just Alabbar but Sheikh Tarek Bin Faysal Al-Qasimi, CEO of the Economic Development Department in Sharjah. Sheikh Al-Qasimi says: “The UAE adopted an open economic policy, which is why it has been able to develop over the past thirty years. We went from being oil dependent to being dependent on commerce, trade and services. Lately, the rise in oil prices has given a surplus to help develop the social infrastructure of the UAE. I think the same could happen in Syria. The good thing is that many companies in the UAE also now have a surplus as a result of the rising oil prices, and so they are looking for places to invest. I think Syria is a very good opportunity for many of these companies.” So far, Emaar is leading the way, having already begun work on Damascus’s Eighth Gate development. Inspired by the seven gates that were once access points to Syria, the project is a massive commercial and retail development, just fifteen minutes from the centre of Damascus. Apart from being Emaar’s first foray into the country, more importantly it is the first major commercial development being undertaken in Syria for several years. In theory, it may be just what is needed to kickstart a major development programme. Alabbar, one the forum’s guest speakers, says that the key to Syria’s economic future lies in a “balanced development” programme. He explains: “If you take the UAE example, we created a lot of job opportunities which then required a huge amount of skilled labour. And so the education system in the UAE responded.” He adds: “Of course in the UAE there was a keenness on growth, but we had a clear vision, that of Sheikh Mohammed. You see, everybody dreams. The question is who really has the courage to implement their dreams?” Alabbar insists that Emaar is in Syria for the long term. “We didn’t come to Syria a year ago just so we could say we are here. It is because of what we perceive to be good investment conditions. Syria’s economic future is about growth. For that to be achieved, very sound plans are needed in real estate, education, health and other sectors. I very much hope, and am confident, that other companies in the Arab world will follow Emaar into Syria.” So will Syria be able to replicate Dubai’s example? Alabbar says it can, but only as a result of hard work. “Some people believe in luck and some people believe in opportunities. Berkeley University did an eleven year study on luck." He adds: "They found that some people work very hard, and then when they become successful we call them lucky. At Emaar it wasn’t always easy. We made several mistakes along the way, but we always learned from them. That is the key to success.” For now, it would appear that Syria is on the road to economic success. ||**||

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