Institute for War and Peace Reporting | Giving Voice, Driving Change

New Syrian-Turkish Economic Ties Forged

(30-Jan-09)
By IWPR
Syria and Turkey have recently bolstered economic relations by signing new agreements on trade, investment and finance.



Experts say the growing ties between the neighbouring countries are in part a result of Ankara’s ambitions to expand into Arab markets via Syria.



They are also a reflection of Damascus’s need to build new regional alliances in light of its deteriorating relations with certain Arab states, they say.



“We have to work as a team to achieve development in both countries,” said Syrian prime minister, Abdullah al-Dardari, at a press conference following a joint meeting of Syrian and Turkish economic officials in Damascus in December.



The meeting concluded with a decision to set up an industrial area for Turkish manufacturers in the Syrian industrial city of Hisyah, near the border with Lebanon. The two countries also agreed to establish a centre in Syria to facilitate commerce between the two countries as well as with other nations.



Other decisions included establishing joint banks, coordinating financial and development policies and boosting investments on both sides of the border. The agreement also touched on cooperation in transportation and energy.



“Turkey is seeking, through these economic agreements, to build a regional economic belt extending towards the Arab and Gulf area, after a long history of disagreements [with countries there],” said Munir al-Hamash, a leading economist in Damascus.



He added that Turkey is seeking to play a “pivotal role” in the Middle East and needs Syria’s help to access Arab markets.



Turkey is in search of new economic and strategic partners in the region especially since its efforts to join the European Union have failed so far, he explained.



The new bilateral ties in economy and finance mirror the growing diplomatic and political relationship between the two states.



It is a remarkable change considering their past history of mutual distrust.



In 1998, Turkey and Syria came close to war after Ankara accused Damascus of supporting the PKK, the Kurdish guerrilla group. The tensions were defused after Damascus agreed to expel PKK leader Abdullah Ocalan, who is now serving a jail sentence in Turkey.



In more recent years, Damascus has begun to view Ankara as a regional ally which enjoys good relations with the West. It has built ties with Turkey as its relations with Arab states like Saudi-Arabia and Egypt have soured.



Last year, Turkey played a role as mediator of indirect peace talks between Israel and Syria.



Meanwhile, the Turkish support for the Palestinians at both official and popular levels during the Gaza conflict was praised in Syria.



Nazim Ekren, Turkish deputy prime minister responsible for economic affairs, told reporters after December’s economic meeting that bilateral economic cooperation had reached an “advanced stage”.



He said strengthening these ties was important for both countries as they tried to cope with the effects of international financial crisis.



Baha al-Din Hasan, the Damascus-based president of the Syrian-Turkish Business Council, said his country is a strong economic partner for Turkey, offering raw materials for industry as well as a trained workforce.



With about a million tons of cotton produced annually, Syria could become a competitive supplier of material for the clothing industry in Turkey, the sixth largest in the world, he said.



For its part, the Turks could provide expertise in areas such as the stock market, banking and e-government, he said. In the industrial field, Turkey could provide technical support to Syrian glass factories and cement production.



Turkish investment last year was estimated at more than 900 million US dollars, according to an official Syrian report, which noted that both countries wish to see this rise substantially over the next five years.



Last year, Syria and Turkey signed free trade agreements abolishing customs tariffs and expanding trade in agricultural products.



Turkey does not tax Syrian imports like crude oil, chemicals, fibres and leather, while Damascus has pledged to gradually reduce tariffs on Turkish imports until they are phased out altogether over the next 12 years or so.



Turkish imports include foodstuffs such as cooking oil, chemicals, fertilisers, soap, leather products, clothes and industrial machinery.



(Syria News Briefing, a weekly news analysis service, draws on information and opinion from a network of IWPR-trained Syrian journalists based in the country.)