Sunday, 22 October 2017

The Russians are chaining Syria and drowning it in debt


 'Russia has drawn up a map of military bases in Syria that is re-establishing its presence as a central force in the Middle East. However, there is an economic agenda that Moscow is hiding behind its military and political presence, the most important of which is obtaining long-term economic advantages through signing agreements with the Syrian regime, as a way to return its favour in contributing to keeping the Syrian regime and its president, Bashar al-Assad.

 The economic relations between Damascus and Moscow are not the result of military intervention, but they date back to the Soviet Union and the rule of former President Hafez al-Assad in the 1990s. In addition, the son Bashar al-Assad has worked on strengthening more trade and economic relations between the two countries. In 2005, he signed about 43 agreements, in the fields of industry, trade, defence, healthcare, energy, and irrigation.
According to analysts, the regime’s concessions and signing agreements with Moscow is not new. Russia has cancelled 73% of its debts from Syria ($ 9.8 billion of the total debt of $ 13.4 billion), during Assad’s visit to Moscow in 2005, in exchange for turning the Tartus Port into a permanent military base for Russian ships.

 However, the concessions have increased after the outbreak of the revolution, after Assad resorted to Putin to maintain his regime. By that time, Russia has started taking advantage of its position by signing the 2013 “Amrit contract which is an unprecedented huge agreement with a Russian company, for oil and gas exploration in the Syrian territorial waters.

 It is a 25-year contract which includes the exploration of 2190 square kilometres at a cost of $ 100 million, funded by Russia. If oil or gas is discovered in commercial quantities, Moscow will recover the costs from the production revenues, according to what the Director-General of the General Petroleum Corporation of the regime’s government, Ali Abbas, claimed to AFP.

 After the Russian military intervention, the two sides have signed agreements in various fields, including two agreements worth 600 and 250 million Euros, in 2016, in order to repair the infrastructure that has been destroyed by the “battle”, as well as the construction of power stations and grain silos. Thus “the Syrian market has become open to Russian companies which can be present, join, and play an important role in the reconstruction and investment in Syria,” according to Syrian President Bashar al-Assad, in an interview with Sputnik Russian news agency in April.

 On June 29, the Russian Fontanka Electronic Network published a memorandum of cooperation which Europolis Russian Company signed with the Syrian Ministry of Oil and Mineral Recourses earlier this year. The memorandum states that the company is committed to “liberate and protect areas that contain oil wells and facilities,” in return of getting one quarter of oil production.

 Since early June, a Russian company, owned by billionaire Gennady Timchenko, has been carrying out maintenance work for the largest phosphate mines in Syria, located in Khunayfis region near the city of Palmyra, according to a report published by Russia Today website on June 27.

 Russia Today article confirmed that al-Assad signed the agreement on April 23. The agreement was between the General Organization for Geology and Mineral Resources of Syria and STNG Logestic, a subsidiary of Story Trans Gas, which owns 31% of the company. This agreement was aimed at implementing the maintenance needed and providing protection, production, and transport services to Selaata port in Lebanon.
Moreover, Russia intervened in the field of Syrian food and became the country with the most exports of wheat, which is considered as a strategic product. Internal Trade and Consumer Protection Minister, Abdullah al-Gharbi, announced an agreement to buy three million tons of wheat from Russia in September.

 Moreover, Russian company, SovEcon, will build four grain mills in Homs at a cost of 70 million Euros. The Syrian government will be the one covering the construction costs, according to what Ziad Balla, Director General of General Mills Company, said in April 2016. Ziad also talked about a cooperative work with the Iranian side is done in order to build and prepare five mills in many provinces.

 Economist Munaff Kuman asserted that the contracts and agreements between Russia and Syria will have devastating effects on the Syrian economy on the long run, as it will tie up the economy and the future Syrian government and will prevent it from taking any developmental steps that may lead to the autonomy of national decision and the ability to invest Syria’s natural resources.

 Kuman also asserted that “any development process will collide with Russia and Iran, which will prevent the whole process”. (Tehran also signed several agreements with the regime)

 The researcher stressed the seriousness of contracts relating to the exploitation of oil ports and the right to prospect for oil and gas and phosphate and extract it, because it will be stolen for the benefit of Russia and Iran. The two countries will work on “sucking the wealth” without taking into account any national interests of the Syrians. Russian companies may also sell oil, gas, and phosphate extracted from Syrian territory at high prices, and this will have negative effects on the government and the citizen in terms of costs and prices in the local market.'

The change in the field control map in Syria between 2016 and 2017 (Enab Baladi)

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