Geography

Syria's eastern border with Iraq runs mainly through the desert, while the northern border with Turkey is more mountainous. The very easternmost part of the border with Turkey is the Tigris River, while the Euphrates crosses into Syria about 100 km north-east of Aleppo. Syria's main ports of Lattakia and Tartous are on the Mediterranean Sea in the west, and further south the western part of the country borders Lebanon. Just to the south of this region lies the disputed Golan Heights; the Israeli border is about 50 km from Damascus, causing no end of worries in the capital. From the Golan the border with Jordan turns eastwards, to the south of Jebel Druze, until it reaches the Iraqi Desert. From the coastline in the west the land rises sharply to a series of mountain ridges, which have snow every winter, but are wonderfully verdant in the summer, before falling gently to the plain of central Syria. East of here the mountains rise again, but less spectacularly than in the west, before again falling to the Syrian Desert. The main cities are all on a north-south axis, stretching from Damascus in the south, via Homs and Hama, to Aleppo in the north.

Population

Around 60% of the Syrian population lives in urban areas, and the two largest cities, Damascus and Aleppo, each have approximately 3.5m inhabitants. Small ethnic minorities are represented in Syria, but their presence is not a major issue as it is in some neighbouring countries. Palestinians are obviously present, but the numbers are not anything like those in Jordan or Lebanon. In a similar way the Kurds are represented in the north-east of the country, but again the numbers are minimal, allowing Syria to escape most of the "Kurdish problem". Disturbances in 2004 in the Kurdish areas were quickly quelled, and the government has sought to address the citizenship concerns of some "state-less" Kurdish residents. In terms of religion, the majority of the country is Muslim, around 70% mainstream Sunni; however, the Alawis, a small sect of Islam, remain prominent in public life. Some of the population of Damascus and Aleppo are Christian, as are some residents in villages north-west of Damascus. However, religion does not play much of a role in Syrian life, as the country is formally secular and it has long been held that an individual's religion is a personal matter.

Syria inherited its education system from the French mandate period, resulting in quite a high standard of education, though not as developed as the system in Lebanon. English has now replaced French as the second language taught in schools. It is believed that about 90% of men and 65% of women are literate, a rate which is slowly climbing. However, the health system is not in good shape due to a chronic lack of funding.

Economy

Syria remains a country being pulled in two separate economic directions. On the one side lie the state-centric economic policies of the past, imbued as they are with the principles of socialist economic thinking. Whilst on the other side lie the increasing demands of a capitalist, free market economy.

About one-third of Syria is cultivated, agriculture being one of the most important contributing factors to the economy. Agriculture represents up to 30% of GDP according to some estimates, employs some 30% of the workforce, and it is estimated that another 20% of workers are indirectly dependent on this sector. The investments made in agriculture by the government have allowed Syria to somewhat negate the rural-urban drift all too common in other parts of the Middle East. The World Bank divvied up Syria's GDP in 2004 as follows: agriculture 25%, industry 31% and services 44%.

The country is fed by two of the region's largest rivers, the Tigris and the Euphrates, in addition to the run-off from the mountains, which receive a fair amount of winter precipitation. Unfortunately, the rivers have been a source of dispute with Turkey in recent years, since both countries have built hydro schemes along the rivers.

Agriculture is heavily centralised, with strong government intervention in the cultivation of cotton and cereals. Fruits and vegetables, which are also important in this sector, are left far more to market forces.

Oil production remains an important aspect of the economy, and it is estimated that Syria has 3bn barrels of oil reserves, not all of it recoverable. Recoverable gas reserves, estimated at 300bn cu metres, have been pressed into service to supply Syria's insatiable thirst for electricity. The production of oil has been falling in the latter half of the 1990s, even in the last few years it has fallen from 604,000 barrels per day (bpd) in 1996 to 520,000 bpd in 2004. Some say that this decline in exports was arrested thanks to the pumping of Iraqi oil through the UN's "oil for food" programme in the years prior to the US occupation of Iraq. However, the Syrian government strenuously denies these allegations. The SCOT pipeline, which can transport oil from Iraq to Syria's Mediterranean ports, was destroyed in fighting following the Gulf war in 2003, and has not yet recommenced pumping operations outside of its branchlines in Syria proper.

The Syrian public sector is vastly over-staffed, and often poorly paid. Moves to dramatically improve the salaries of state employees, by pay rises of up to 20% in 2004, have worried many that they could inspire inflation. Corruption remains a significant problem in Syria, as are the restrictions the government imposes on the private sector. The millstone of taxes and duties still weighs heavily around the neck of much of Syria's private sector. The privatisation of key assets has not been countenanced on a grand scale, and is unlikely to be in the foreseeable future. Thus far, most of the private sector is concentrated in light industry, whilst the government retains control over the "big wheels" of the economy.

Reform is much needed in Syria, but it is slow in coming. However, the recent endorsement by the cabinet of Bashar's liberalising policies in regard to harmonising the multiple exchange rate regime and allowing for the limited operations of private banks herald real change. A major cabinet reshuffle in December 2001 saw changes in the economic ministries in favour of reformists. This trend was continued in the November 2003 cabinet reshuffle, which also entailed a reduction in the number of ministries.

Most light industry is concentrated around Damascus and Aleppo, whilst the heavier industry is around the cities of Homs and Hama in central Syria. Oil and gas meanwhile are produced in the east of the country near Deir ez-Zour.

Accurate statistics remain difficult to obtain for the Syrian economy, though recent projects involving French and German aid missions aim to reform the Syrian state's budgetary performance, and improve the collation and publication of timely economic data.

Region: Middle East & North Africa

Income category: Lower middle income

Population: 19,496,430

GNI per capita (US$): 1,570.00

Starting a Business

The challenges of launching a business are shown below. Included are: the number of steps entrepreneurs can expect to go through to launch, the time it takes on average, and the cost and minimum capital required as a percentage of gross national income (GNI) per capita.

Dealing with Licenses

Shown below are the procedures, time, and costs to build a warehouse, including obtaining necessary licenses and permits, completing required notifications and inspections, and obtaining utility connections.

Employing Workers

The difficulties that employers face in hiring and firing workers are shown below. Each index assigns values between 0 and 100, with higher values representing more rigid regulations. The Rigidity of Employment Index is an average of the three indices.

Registering Property

The ease with which businesses can secure rights to property is shown below. Included are the number of steps, time, and cost involved in registering property.

Getting Credit

Measures on credit information sharing and the legal rights of borrowers and lenders are shown below. The Legal Rights Index ranges from 0-10, with higher scores indicating that those laws are better designed to expand access to credit. The Credit Information Index measures the scope, access and quality of credit information available through public registries or private bureaus. It ranges from 0-6, with higher values indicating that more credit information is available from a public registry or private bureau.

Protecting Investors

The indicators below describe three dimensions of investor protection: transparency of transactions (Extent of Disclosure Index), liability for self-dealing (Extent of Director Liability Index), shareholders’ ability to sue officers and directors for misconduct (Ease of Shareholder Suits Index) and Strength of Investor Protection Index. The indexes vary between 0 and 10, with higher values indicating greater disclosure, greater liability of directors, greater powers of shareholders to challenge the transaction, and better investor protection.

Paying Taxes

The data below shows the tax that a medium-size company must pay or withhold in a given year, as well as measures of the administrative burden in paying taxes. These measures include the number of payments an entrepreneur must make; the number of hours spent preparing, filing, and paying; and the percentage of their profits they must pay in taxes.

Trading Across Borders

The costs and procedures involved in importing and exporting a standardized shipment of goods are detailed under this topic. Every official procedure involved is recorded - starting from the final contractual agreement between the two parties, and ending with the delivery of the goods.

Enforcing Contracts

The ease or difficulty of enforcing commercial contracts in is measured below. This is determined by following the evolution of a payment dispute and tracking the time, cost, and number of procedures involved from the moment a plaintiff files the lawsuit until actual payment.

Closing a Business

The time and cost required to resolve bankruptcies is shown below. The data identifies weaknesses in existing bankruptcy law and the main procedural and administrative bottlenecks in the bankruptcy process. The recovery rate, expressed in terms of how many cents on the dollar claimants recover from the insolvent firm, is also shown.