Iran Explores Economic Opportunities in Syria, Wins Power Station Contract 

By Hamed Mohammadi

A privately held Iranian energy company has won the contract to build a 540 megawatts gas-fired power station in the Syrian coastal city of Latakia, Iran’s Minister of Energy Reza Ardakanian has said.

“Iran is one of the top regional exporters of technical skills, practical abilities and specialized knowledge in the fields of electrical and water engineering,” Mr. Ardakanian was quoted by the Islamic Republic News agency (IRNA) as saying. “Several companies have expressed interests in investing and developing Syria’s electric power industry. A privately held Iranian company is building a 540 megawatts power plant in the Syrian coastal city of Latakia.”

MAPNA Group, an Iranian corporation involved in developing thermal and renewable energy, has secured the contract to build a power plant in Latakia at the combined cost of 411 million euros, IRNA reported. According to the memorandum of understanding between the Syrian electric power company and MAPNA Group, the first gas unit of the power plant will be completed in 15 months with the second gas unit and a steam unit becoming operational, respectively, in 24 and 34 months.

It would appear that Iran has been exploring economic opportunities in Syria to compensate for the financial loss it has suffered as the result of U.S. sanctions.


FILE PHOTO: Syria's President Bashar al-Assad shakes hands with Iranian Supreme Leader Ayatollah Ali Khamenei in Tehran, Iran. REUTERS./

Speaking at a meeting of Iranian oil, gas and petrochemical business executives held at the Iran Chamber of Commerce, Industries, Mines and Agriculture (ICCIMA) late last month, Hassan Danaeifar, the chairman of the Iranian committee on the development of economic relations with Syria and Iraq, highlighted the need for expanding Iran-Syria economic cooperation particularly in the oil and mining sector.

“Trade relations between Iran and Syria have increased by 25 percent since March compared to the same period last year,” Mr. Danaeifar was quoted by the Mehr News Agency as saying.

“Iranian and Syrian officials have agreed that the private sector should be the principal partner in all industrial and manufacturing renewal projects,” Syrian Ambassador to Tehran Adnan Hassan Mahmoud said at the ICCIMA meeting. “We must, therefore, provide the support these companies need to coordinate their efforts and invest in Syria. The creation of joint Syrian-Iranian companies is a positive step.”

Ambassador Mahmoud also called for greater economic cooperation between Damascus and Tehran and concerted efforts to bypass sanctions.

The chairman of the Iran-Syria Joint Economic Committee, Kayvan Kashefi, who also spoke at the ICCIMA gathering, contrasted the extensive political interactions with the limited economic relations between the two countries.

“What prevents the development of business and trade relations between Iran and Syria is the lack of information about Syrian trade laws,” Mr. Kashefi explained. “We also know little about the Syrian market. Eight trade delegations have traveled back and forth between the two countries in the past eight months to get a better understanding of the Syrian market. Fortunately, there are more commercial flights between Tehran and Damascus which could develop the tourism industry between the two countries.”

According to Hamid Hosseini, the secretary-general of the Iran-Iraq Chamber, the reopening of the Abu Kamal border crossing between Iraq and Syria will reduce the cost of Iranian exports to that country.

Speaking at the ICCIMA gathering, Mr. Hosseini said: “Syria’s oil and gas reservoir stands, respectively, at 2.5 billion barrels and 8.5 trillion cubic feet (TcF). The country produces and imports, respectively, 30,000 and 60,000 barrels of oil every day. It also has the capacity of refining 112,000 barrels of oil.”

“We spent people’s livelihood in the Syrian war,” the former Deputy Foreign Minister Mohsen Aminzadeh (1997-2005) recently said. In comments reported by the Shargh daily on September 21, Mr. Aminzadeh argued: “The military should have helped the Foreign Ministry to manage the Syrian crisis. The Foreign Ministry could have worked with the international community to prevent the Syrian crisis.”


FILE PHOTO: Russian President Vladimir Putin addresses servicemen as he visits the Hmeymim air base in Latakia Province, Syria . REUTERS./

The presence of the Iranian military, particularly the Islamic Revolutionary Guards Corps (IRGC), in Syria since the beginning of the war eight years ago, has posed a serious security threat to Israel. Iraq and Syria have provided Iran with a unique opportunity to expand its military influence in the region.

Major-General Yahya Rahim Safavi, a senior military adviser to Iran’s Supreme Leader Ayatollah Ali Khamenei, said on January 9, 2018, that “one of the most challenging issues facing the U.S. is the increasing global appeal of the Islamic Revolution.”

General Safavi, a former head of the IRGC, made those remarks during a speech at the 2nd National Congress of the Guardians of the Revolution and Sacred Defense (Iran-Iraq War 1980-88) in Tehran.

“Despite the massive military and financial investment, Iran and Russia are both winners in Syria. Moscow has signed a 49-year economic and trade agreement with Damascus and maintains a naval facility [at Tartus on the Mediterranean coast,]” Mr. Safavi noted. “Iran could also sign a long-term economic and trade agreement with Syria to recover the military expenditure in that country. Iran is profiting from the Syrian phosphate mines.”

The evidence, however, does not support Safavi’s claim that Iran has won the war in Syria. A commentary by the Istanbul-based journalist Borzou Baragahi published in the June 2018 issue of Foreign Policy (FP) news website said that Syrian War had cost Iran $30 billion.

“Iranian officials and other experts say the country has invested too much blood and treasure — upwards of $30 billion to date — to fold to international demands, regardless of Israeli airstrikes, or even Moscow’s pressure. Having already made such a massive investment, Iran is determined to reap the potential long-term strategic rewards Syria offers — even if it comes at the expense of more lives and money in the short term,” the commentary said.

In an interview with the Iranian Labor News Agency (ILNA) on November 2017, Hossein Selahvarzi, the vice-chairman of the ICCIMA said: “Although we have extended a letter of credit for $1 billion to Syria, the country has placed many restrictions on its imports, making it next to impossible for Iran to export any goods to Syria.”

“Data has shown that besides close political ties the two countries maintained better economic relations in the past,” Tasnim news agency reported in October of last year. “Iran exported $516 million worth of goods to Syria in 2010. That number dropped by 60 percent to $172 million in 2017. Iran has exported only $92 million worth of goods to Syria in the first half of the current year [2018].”

“Meanwhile, Turkey’s share of the Syrian market grew from 9 percent in 2010 to 24 percent in 2017,” Tasnim added. “Data has also shown that Iran’s share of the Syrian market is only 3 percent which is considerably less than Turkey, China, United Arab Emirates (UAE), Egypt, Lebanon, South Korea, and Russia.”

[Translated from Persian by Fardine Hamidi]