State Planning Minister Issam Zaim said he is pessimistic about foreign investment in Syria where industry is not competitive, in a speech reproduced in the government newspaper Tishrin Tuesday.
The government is trying to attract Arab and international capital while giving priority to local capital, he said, adding: "Personally, I'm not optimistic because foreign capital seeks high profits, especially in the oil sector."
"We must make Syrian industry competitive," he told an economic conference in Damascus.
"Time counts because we have been in negotiations with the European Union for five years now, and we still haven't drawn up a plan" for a partnership agreement that will lead to a free-trade zone by 2010.
"We must not underestimate this matter, above all if we keep in mind the example of Tunisia, which lost a third of its industry by committing itself to an EU partnershp, and we know the very difficult situation Syrian industry is in," Zaim said.
"This industry isn't competitive because it was founded under protectionism and began to modernize late." He called for "temporary, scheduled and dynamic protectionism."
Malaysia was an example of a country "where raw materials represented more than 80 percent of exports 25 years ago, as is now the case in Syria." Today, the majority of Malaysian exports are from processing industries, he said.
Zaim reiterated that he is "not optimistic about the arrival of foreign investment in Syria.
"Foreign investors aren't very attracted by new industries unless facilities are granted to them."
Syria's economy is open to foreign investment, but obsolete laws and heavy-handed administration discourage investors.
However, talk of reform has been in the air. The parliament is currently considering bills to create a stock exchange and private banks in Syria.
And in July, four Saudi companies set up a holding company with 100 million dollars in capital to finance development projects in industry, real estate, tourism, agriculture and communications. – (AFP)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)
