SYRIA: At a meeting of Arab finance ministers in Damascus, Kuwaiti and Saudi funds pledge a loan to fund a power generation project in Syria

Record ID: 278876

  • Title: SYRIA: At a meeting of Arab finance ministers in Damascus, Kuwaiti and Saudi funds pledge a loan to fund a power generation project in Syria
  • Date: 7th April 2011
  • Summary: DAMASCUS, SYRIA (APRIL 6, 2011) (REUTERS-ACCESS ALL): ( ** BEWARE FLASH PHOTOGRAPHY **) SYRIAN MINISTER OF FINANCE MOHAMMAD AL-HUSSEIN ARRIVING WITH HIS SAUDI COUNTERPART IBRAHIM AL-ASSAF AT THE HALL WHERE SIGNING IS TO TAKE PLACE CLOSE OF THE TWO MINISTERS HUSSEIN AND ASSAF SIGNING THE AGREEMENT CLOSE OF ASSAF SIGNING THE AGREEMENT HUSSEIN AND ASSAF SHAKING HANDS (
  • Embargoed: 22nd April 2011 13:00
  • Keywords:
  • Location: Syrian Arab Republic
  • Country: Syria
  • Topics: International Relations,Industry
  • Reuters ID: LVADV1GX6SOMOQR6W5AP9F7AHOA
  • Story Text: The Syrian government signed a loan agreement with the Saudi Fund for Development on Wednesday (April 6) for a loan for 100 million U.S. dollars (USD) to fund a Syrian electricity generating project.
    The Syrian Finance minister Mohammad al-Hussein said the Kuwait-based Arab Fund for Economic and Social Development (AFESD) would sign an agreement for a loan of a further 108 million USD on Thursday (April 7) to fund the project in the eastern Syrian province of Deir al-Zor.
    "We will invest this money as I mentioned to build a power generating plant in the eastern region in Deir al-Zor. Tomorrow we will sign an agreement with the Arab Fund for Economic and Social Development, and this will complete the funding for the Deir al-Zor power station. The project will cost, I think, about a billion dollars or a little bit less. But after we sign with the Arab Fund, and after signing today with the Saudi Fund, the funding of the station will be complete. The Syrian Ministry of Electricity announced it was doing this project," al-Hussein said at a meeting of Arab finance ministers in Damascus.
    The loans from the Arab funds will be added to a further 108 million USD from the AFESD to be offered in the third quarter of the year, al-Hussein said, and to an undisclosed amount from the European Investment Bank.
    The loan from the Saudi Fund for Development was given for a 20 year period at a two percent interest rate, with payments waved for the first five years. The AFESD loan was given for a period of 22 years with a three percent interest rate, also with a five year grace period.
    Saudi Finance Minister Ibrahim al-Assaf, who signed on behalf of the Saudi Fund for Development, said the move aimed to foster further economic cooperation between Syria and Saudi Arabia.
    "This agreement comes according to the directions of the Saudi king and President Bashar al-Assad to reinforce economic cooperation between the two countries, as you know. Also the Syrian-Saudi joint committee was activated and we held the first meeting headed by the two ministers of finance last year in Damascus. The next meeting will be in Riyadh to reinforce economic cooperation in all fields. Cooperation in development is one of those fields, and we are also looking forward for more opportunities of investment in the private sector," al-Assaf said at the finance ministers meeting in Damascus.
    The past two years have seen a thawing of relations between Syria and Saudi Arabia. The 2005 killing of Lebanese statesman Rafik al-Hariri, who had strong ties with Saudi Arabia, drove a wedge between Riyadh and Damascus. But both sought to ease strains over a U.N. tribunal, which is set to indict members of Hezbollah, allied to Syria and Iran, in connection with Hariri's killing.
    But little has emerged on the ground in terms of economic cooperation since Saudi King Abdullah visited Syria in a landmark visit in 2009 and Syrian President Bashar al-Assad visited Saudi Arabia twice last year.
    Some Saudi firms have put out feelers to Syria. And in April last year, a private Saudi waste-water company was granted contracts in Syria worth around three million USD.
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