A campaign in the Syrian press to reform outdated economic laws
Syria, Economics, 6/18/1999

Calls have increased in Syria to reform laws which govern the Syrian economy, especially as among these laws are those that date back several decades that have become a great constraint to growing the economy.

Chairman of the Damascus Chamber of Commerce, Yahya al-Hindi, spoke about the "outdated rules and regulation which can no longer comply with coming requirements."

Among these requirements, al-Hindi indicated joining the World Trade Organisation and the partnership with the European Union. The Syrian industrialist recalled several conditions for joining the WTO, especially opening the Syrian markets, giving up the policy of protection (for instance the government in Syria still provides bread, tea, sugar and rice at very low prices), backing exports, reducing or cancelling customs tariffs.

Al-Hindi said that law no. 24 constitutes "the first and most difficult obstacle before investment." The law, approved in 1986, prohibits taking hard currency out of Syria, and it authorizes prison sentences ranging between three and 25 years against those who violate this law.

Statements issued by the Syrian state-run dailies (all media is owned by the government in Syria) said that law no. 24 implies restrictions that prevent an economic breakthrough. In its weekly economic file, the al-Baath newspaper said it is "not expected to have a foreigner coming to Syria (for investment) under this law."

However, some of the laws which are still enacted in Syria date back to four decades, including those on agriculture (1958), leasing (1952) and housing and property (1979 ).

Moreover the Syrian official media often and mostly on a daily basis reflects the calls which appeal for reforms of these laws. This week, the Syrian Arabic daily Tishreen said that a ministerial committee, at a decision by the Syrian Cabinet, was formed to study proposed amendments on the law no. 10 on encouraging investment of 1991.

The paper added that it proposed an amendment period, special exemptions for holding companies and permitting foreigners to carry out their own private projects. Tishreen added the value of investments did not exceed "US $3 billion" following nine years since the issuance of the said law which was intended just to facilitate these investments.

Tishreen said, "The real problem is not in the law in itself, rather in the obstacles impeding the projects under implementation, especially bureaucracy and administrative routine," noting that there are no industrial zones or a modern banking system in Syria.

Al-Hindi said that Syrian banks "cannot open a letter of Credit L/C freely, thereby industrialists and traders depend on this matter on neighboring countries, and as a result Syria loses hundreds of millions of Syrian pounds."

He asserted the need to make economic reforms very soon, warning that a large portion of the activities of the Syrian businessmen will be transferred to Lebanon, if such reforms are not maintained.

Previous Stories:
  Syrian economy and the GATT   (6/11/1999)
  Middle solution for Syrian debts to Iran   (6/10/1999)
  Syrian advantages for Arab foreign investors   (6/8/1999)
  Special: Oil and the Syrian economy   (6/4/1999)
  special: Syrian foreign trade sector   (5/28/1999)

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