SYRIA: Saudi Arabia plans aid to Syria as ties improve

Record ID: 278504

  • Title: SYRIA: Saudi Arabia plans aid to Syria as ties improve
  • Date: 16th March 2010
  • Summary: DAMASCUS, SYRIA (MARCH 15, 2010) (REUTERS) VARIOUS OF CONFERENCE HALL WITH DELEGATES LISTENING (SOUNDBITE) (Arabic) MUHAMMAD BIN SULEIMAN AL-JASSER, GOVERNOR OF THE SAUDI ARABIAN MONETARY AGENCY, SAYING: "Syria is one of the most important Arab economies. It's a promising market to whoever has money to invest, and I think the news we heard from the (Syrian central bank
  • Embargoed: 31st March 2010 13:00
  • Keywords:
  • Topics: International Relations
  • Reuters ID: LVAAH01KH4QGO7XVRB6PDT7GOEMM
  • Story Text: Saudi Arabia is discussing extending development loans to Syria as ties between the two countries improve but there will not be direct cash assistance, the Saudi central bank governor said on Monday (March 15).
    Diplomatic activity between Damascus and Riyadh picked up in the last months after they agreed to set aside their political differences and lower tension between their allies in Lebanon, which is a recipient of large Saudi cash injections.
    Ties deteriorated after the 2005 assassination of Rafik al-Hariri, a Saudi-backed Lebanese member of parliament and former prime minister, resulting in the waning of Saudi investment appetite and aid to Syria.
    "Syria is one of the most important Arab economies. It's a promising market to whoever has money to invest," Muhammad al-Jasser, head of the Saudi Arabian Monetary Agency, said after attending a conference on Islamic banking in the Syrian capital.
    "I hope the businessmen and businesswomen will benefit from the opportunities available in Syria," he added.
    Syria needs billions of dollars in investment to overhaul its infrastructure, resuscitate its drought hit east, lower unemployment and deal with a 2.5 percent annual population growth.
    Most of the investment has been by Syrian expatriates and investors from the Gulf into banking and real estate. Economic growth fell to 3 percent last year compared with 5.2 percent in 2008, according to the World Bank.
    Asked whether Saudi Arabia could deposit cash directly into the Syrian central bank, as it did with Lebanon, Jasser said such a move "will not be considered".
    But he said that the Saudi Fund for Development signed a memorandum of understanding with the Syrian finance ministry last week to lend $140 million to raise output at a power station in Syria.
    If extended, the loan will be the first since the Hariri assassination, which Saudi-backed politicians in Lebanon blame on Syria. Damascus denied any involvement.
    Syria, which is under U.S. sanctions for its support of militant groups, has opened several sectors of the economy to private investment, especially banking and insurance, since President Bashar al-Assad succeeded his late father, Hafez al-Assad, in 2000.
    The ruling Baath Party, which Bashar controls, nationalised large parts of the economy and enacted bans on private enterprise when it took power in 1963. It also imposed emergency law which is still in force and banned any opposition.
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