Syria, suffering from dwindling oil revenue and a sluggish, state-dominated market, is banking on an economic boost from an unlikely source: Iraq. A recent thaw in the countries' political relations is raising hopes in Damascus of an increase in trade.
Syrian Minister of Economy and Trade Amer Hosni Lutfi said during a recent trip to Iraq that he hopes to more than triple bilateral trade, now estimated at $800 million, far behind Syria's biggest trade partners, China and Turkey, at $2 billion each. Syrian officials also have said that a railway line from the coastal city of Tartous to Umm Qasr port in southern Iraq is opening this month. The railway promises a faster and cheaper route to the Mediterranean for regional goods typically shipped through the Suez Canal.
Syria's economic ties with Iraq were stronger in the past. Syrian exports to Iraq in 2007 were valued at $641 million, compared with about $2 billion before the U.S. invasion in 2003, according to official Iraqi figures.
In late April, Syrian Prime Minister Mohammad Naji al-Otri paid his first visit to post-Saddam Hussein Iraq. During the trip, officials from the two sides held high-level talks over some 20 trade deals. The meeting was a watershed event for bilateral economic ties, said Adnan al-Sharify, commercial attaché at the Iraqi embassy in Damascus. "Economic ties were at a low level, and they needed a political decision to reactivate them," he said in an interview. The rapprochement comes amid a recent rehabilitation of Syrian President Bashar Assad on the world stage. The U.S. in May sent two high-ranking envoys to Damascus to discuss support for a new push for Arab-Israeli peace, along with security measures along the Iraq-Syria border.
Damascus says it thinks it can use its ports on the Mediterranean to build an important trade route between Iraq and Europe. Iraq's population of 28 million promises a booming market for Syrian and other foreign goods. Baghdad and Damascus already have agreed to reopen the Kirkuk-Banias oil pipeline, which extends from oil fields in northern Iraq to the Syrian port of Banias. The two countries also have held discussions about building a natural-gas pipeline from Iraq's Western Akkas fields to Syria, which could be an attractive transit point for gas-starved Arab and European markets.
Normalcy for Iraq and competition for Russia. If only it weren't Syria at the other end, but in the Middle East the choices are generally between bad and worse, unless Israel is the other party involved.
The trouble that Hassan Nasrallah finds himself in today is too great for Mr. Jumblatt to fix. Hezbollah has lost its reason and has committed a number of self-inflected mistakes and things have gotten worse with the publication of the Der Spiegel report that accuses the group of being involved in the death of [former Lebanese Prime Minister] Rafik al-Hariri.
Bin Nasrallah, who previously announced that he would not be giving any new speeches, retracted from this position and gave a speech on Friday that was evidence of the trouble that Hezbollah is going through. [In this speech] Bin Nasrallah sought protection from Iran, and its Supreme Leader, he stated that "Khamenei has never been miserly towards Lebanon." This represents a [public] revelation of a secret that is already well-known, namely Hezbollah's subordination to Iran. This speech also acknowledged that should Hezbollah and its agents win at the forthcoming elections, this would represent an end to Lebanon's relationship with the international community. Nasrallah tried to reassure the Lebanese by saying that Iran would be their supporter. He said that in the event of an electoral victory he would reveal to them who would aid them in arming the Lebanese military, and there can be no doubt that he means Iran.
The trouble that Nasrallah is having speaks for itself. Today Nasrallah speaks of Walid Jumblatt's courage, yet in May 2008 he described Jumblatt as a "thief, killer, and a liar." This is not the first contradiction [made by Nasrallah]. When Hezbollah embroiled Lebanon in the 2006 War that resulted in 1200 Lebanese casualties Nasrallah accused his critics of being allies of Israel, however he later retracted from this [position] and said "Had I known the size of the Israeli response, I would not have kidnapped the two soldiers." Despite declaring victory, his forces have been pushed back behind the Litani River, and he must now go through international forces if he wishes to confront Israel.
Reality shows that Hezbollah is the elephant in the room, and that it is in major trouble, this is why Ahmadinejad rushed to support the movement. Hezbollah is also still facing the issue of its sleeper cell in Egypt, and then there is the danger of the Hariri Tribunal, for it would have domestic and international impact should Hezbollah be formally charged [of involvement in al-Hariri's death].
In the event of Hezbollah losing at the [forthcoming Lebanese] elections, the group will have been exposed domestically, whilst victory at these elections means international isolation, which is why Nasrallah is using the Iranian Supreme Leader. In addition to all of this, should the [Middle East] peace process be re-launched, and should Syria be involved, Hezbollah will be geographically and politically cut-off.
Whist if armed confrontation occurs between Iran [and another power], Hezbollah will find itself in an unenviable position; for how will Nasrallah convince the Lebanese that Lebanon must rush to Tehran's aid?
Continued on Page 47
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Hezbollah in Lebanon probably gets at least 60% of their revenue from Iran. This hasn't been enough to repair all the buildings destroyed or damaged by the Israelis. This has, I think, led to Hezbollah trying to extort more $ from Iran and some folks in Iran complaining (not loudly) about the burden of subsidizing Hezbollah.
Unless oil goes back to about $80/barrel or more, Iran is eventually going to have to reduce its Hezbollah subsidy and, if and when that happens, it will be a painful day for Nasrallah.
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Syria, suffering from dwindling oil revenue and a sluggish, state-dominated market, is banking on an economic boost from an unlikely source: Iraq. A recent thaw in the countries' political relations is raising hopes in Damascus of an increase in trade.
