In Assad regime Syria, even mentioning US dollars could get you into serious trouble, enough to land you in prison.
Syrians developed codewords for the greenback – "parsley", "mint" or just “the green”.
It will come as little surprise, then, that conducting business could be tough. Often reliant on dollar-based imports and exports, industrialists trod a fine line between obtaining the materials they needed from abroad and avoiding the notoriously corrupt and violent security services.
As sanctions aimed at punishing the regime strangled the economy, foreign trade and investment attraction became even more difficult.
But since the fall of the regime last year, Syrians no longer have to speak in whispers about buying goods in US dollars, enabling business links with the wider world. And with the government in Damascus keen to build ties with foreign investors and trade partners, some factories in Aleppo’s Sheikh Najjar industrial city say they have already expanded production.
Ghazwa Al Ahmed, a manager at Akkad Carpet and Yarn, walks through a spotless office with gleaming glass-walled rooms. In the neighbouring factory, scores of yarn cylinders line up and workers inspect rugs emerging from weaving machines.
From here, the firm manufactures carpets and yarns for domestic consumption in Syria and exports to Iraq, Saudi Arabia and Lebanon. The firm operated under the former regime but things have become easier since last December following the offensive led by Hayat Tahrir Al Sham (HTS).
“Compared to previous years, our production is high and it has become easier to secure raw materials,” Ms Al Ahmed told The National. “These things have become easier to obtain and deliver to us. Before, they were delivered but it took a long time to reach us due to many factors. Now we place an order and it is delivered to us directly, whether from Turkey, Jordan, Saudi Arabia, the United Arab Emirates, or any other country.”
Sitting in the heart of historical trading routes, Aleppo has been a commercial centre for thousands of years, from antiquity through to the Ottoman and modern-day periods. Before Syria’s civil war, the city had a population exceeding two million and was the country’s industrial capital, home to producers of textiles, food and chemicals.
The status quo in Aleppo’s industrial sector reflects the challenges currently facing Syria more broadly: rebuilding segments of infrastructure, forging relationships with the world, including foreign investors, and dealing with officials and businesspeople tied to the former Assad regime.
No commitments yet
The industrial city was heavily bombed in fighting between rebels and the former regime, and the destruction wrought is still plain to see. The old management building is a shell of concrete columns and officials operate from a series of squat huts nearby.
At a warehouse complex, twisted metal pokes out from a rocky crop of dusty grey rubble, as half a dozen men pick any valuable materials from the destruction. The site was bombed by Israel in 2019, officials said, tallying with news reports from the time. The warehouses had been used as storage by Iranian militia groups that backed Mr Al Assad, according to the city’s deputy manager, Youssef Fattouh. He could not give an estimated overall cost of the damages to the industrial city from the war but said it was “a lot".
“We are working to rehabilitate the damaged infrastructure through numerous projects that are currently scheduled to restore roads, electricity substations, pylons and street lighting,” all of which were damaged, Mr Fattouh said.
Around 900 units on the 4,400-hectare site are being repaired or rebuilt, in addition to 1,500 that are operating, housing hundreds of textile firms, chemical and pharmaceutical factories, and construction material plants.
One section is home to a series of vehicle factories owned by the Qaterji family, a trading empire close to the Assads. They are now being managed by the government in Damascus, until “a decision is made by the illegal gains committee”, Mr Fattouh told The National. “Some factories are operating but they are managed by the Ministry of Industry. Most of them are not working.”
The “illegal gains committee” is a body set up by Syria’s current government to identify and determine the fate of companies that belonged to former regime cronies.
The industrial zone is trying to attract new investors and Mr Fattouh says one way is through an order recently issued by the Ministry of Industry regarding plots owned by people who have not developed their assets.
“We have a decision from the minister that within 90 days, if you are completely insolvent, either you sell your land, enter into production within a year and a half, or you leave the land and we offer it to a new investor,” he explained.
Each new investor could provide on average 30 to 40 jobs for Syrians, Mr Fattouh added, at a time when 90 per cent of the country’s population lives in poverty and needs work.
Attracting foreign investment is a priority. Mr Fattouh says he and other directors recently offered a Saudi Arabian delegation a “large plot of land that would be reserved for Saudi or Gulf investors in general” as an incentive. Turkish investors are looking for Syrian business partners to work with on the ground. Changes to Syria’s investment law strengthened property ownership rights for foreigners and also introduced tax breaks on specific sectors.
But so far, Mr Fattouh admits, the vast majority of foreign investors have visited the site without making commitments. One Turkish businessperson has agreed to an investment in some land in the city.
Natural outcome
“To be honest, we have had many visits from foreign, Arab and Turkish investors, but so far most of them come to see if we can invest or not,” he said. “Can we maintain security or not? They all want to see what is on the ground.”
While Aleppo has been mainly calm since the fall of the Assad regime, and has avoided wide-scale sectarian and revenge-driven violence that has plagued other Syrian cities, there have been some clashes. On Monday, several people were killed in fighting between the Syrian army and Kurdish militias in two districts in the city’s north-west.
High electricity costs are affecting the competitiveness of some firms’ goods by raising production costs, says Mohammed Sheikh Al Kar, president of Aleppo’s Chamber of Commerce. The government recently raised energy prices to reduce the billions of dollars spent each year supporting the power sector.
Mr Al Kar said he hoped recent deals signed with Turkey and Qatar to increase power supply would reduce electricity costs in the long term, thereby improving the competitiveness of Syrian products.
'We hope that within two or three years, we will be among the countries that export electricity ... which will increase commercial and industrial activity, and allow for competition and the export of goods,” he told The National in an interview in his wood-panelled office in central Aleppo.
Despite the efforts to get firms up and running in the industrial city, some Aleppan industrialists who fled during the civil war have concerns about returning to Syria.
Mohamad Dadoua owned numerous textile and industrial processing plants in Aleppo, outside the industrial zone. But when violence escalated at the end of 2012, he was forced to flee to neighbouring Turkey. Leaving was “not a commercial choice but a decision of survival”, he told The National.
He lost fixed assets, including machinery, equipment, buildings, his inventory and his existing contracts. He “started from scratch” in Turkey, where he built up several textile production firms around the city of Bursa.
He had both “desire and intention” to rebuild his business in Syria, he said, but added that the “absence of a stable legal environment” and “energy and infrastructure problems” were among the obstacles to his return.
Syria’s parliament has not been fully formed since the October elections, preventing the passage of new legislation. The country also needs to apply internationally recognised quality and safety standards, Mr Dadoua believes.
He said the lifting of foreign sanctions on Syria was an important step, but not enough on its own to encourage investors to pump money into Syria. For that to happen, they would have to see real differences in areas such as the feasibility of money transfers to Syria, which are currently extremely limited.
“Syria, and Aleppo in particular, have the people and the expertise,” he said. “What it lacks is an environment that protects these people and allows them to be productive. Once this environment is in place, returning is not a question but a natural outcome.”
