Executive Summary

Iran, a major ally and enabler of the Syrian regime, is increasingly engaged in competition over access to the Syrian economy now that there are new opportunities for lucrative reconstruction contracts. This report sheds light on the economic role played by Iran in Syria through its local representatives and Iranian businessmen. It also explores the (limited) impact of the European Union and U.S. Treasury sanctions on Iran's economic instruments in Syria.

Introduction

Iran has invested heavily in the protection of the Syrian regime and the recovery of its territories. Iran’s main objectives in Syria have been to secure a land bridge between its territory and Lebanon, and to maintain a friendly regime in Damascus. Much of Iran’s investment has been military, as it has financed, trained, and equipped tens of thousands of Shi’a militants in the Syrian conflict. But Iran has also made major financial and economic interventions in Syria: it has extended two credit lines worth a total of USD 4.6 billion, provided most of the country's needs for refined oil products, and sent many tons of commodities and non-lethal equipment, notwithstanding the international sanctions imposed on the regime. In exchange for its commitment to ensuring Assad’s survival, Tehran has expected and demanded large concessions in terms of access to the Syrian economy, especially in the energy, trade, and telecommunications sectors.

Key Iranian Companies

Iran has provided crucial economic assistance to the Assad regime in order to prevent its fall and to ensure that it can meet its fuel needs. In return, Iran demanded access to significant investment opportunities in key sectors of the Syrian economy, notably: state property, transportation, telecommunications, energy, construction, agriculture, and food security.

Since 2013, the Iranians have aided Assad through two main channels. First, it extended two lines of credit for the import of fuel and other commodities, with a cumulative value of over USD 4.6 billion. In order to position itself strategically as the lynchpin of the Syrian economy, Iran restricted the benefactors and implementers of these credit lines to its own national companies. It can thus continue to provide the regime with a lifeline in terms of goods and energy supplies, but in return it can control key parts of the Syrian economy.

The following list includes major Iranian companies that have announced a return to business-as-usual in Syria. Each brief overview gives a description of the company’s involvement in Syria, followed by basic information about the company.

Khatam al-Anbia Construction Base

Has demonstrated an interest in carrying out reconstruction work on Syria infrastructure.

Khatam al-Anbia Construction Base is involved in construction projects for Iran's ballistic missile and nuclear programs. It is listed by the UN as an entity of the Iranian Revolutionary Guard Corps (IRGC), with a role “in Iran's proliferation-sensitive nuclear activities and the development of nuclear weapon delivery systems” (Annex to U.N. Security Council Resolution 1929, June 9, 2010). The company is under the command of Brigadier General Ebadollah Abdollahi.

Khatam al-Anbia conducts civil engineering activities, including road and dam construction and the manufacture of pipelines to transport water, oil, and gas. It is also involved in mining operations, agriculture, and telecommunications. Its main clients include the Ministry of Energy, Ministry of Oil, Ministry of Roads and Transportation, and Ministry of Defense.

Since the company’s founding in 1990 it has designed and implemented approximately 2,500 projects at the provincial and national levels in Iran. It currently works with 5,000 implementing partners from the private sector. An IRGC official recently revealed that a total of 170,000 people currently work on Khatam al-Anbia’s projects and that in the past 2.5 years it has recruited 3,700 graduates from Iran’s leading universities.

Company officials for Khatam al-Anbia include IRGC General Rostam Qasemi and Deputy Commander Parviz Fatah. Other personnel reportedly include Abolqasem Mozafari-Shams and Ershad Niya.

MAPNA Group

  • Supplying five generating sets for gas and diesel operations (credit line)
  • Construction of a 450 MW power plant in Latakia (credit line)
  • Implementation of two steam and gas turbines for the power plant supplying the city of Baniyas (credit line)
  • Rehabilitation of the first and fifth units at the Aleppo power plant (credit line).

MAPNA is a group of Iranian companies that build and develop thermal power plants, as well as oil and gas installations. The group is also involved in railway transportation, manufacturing gas and steam turbines, electrical generators, turbine blades, boilers, gas compressors, locomotives, and other related products. The Iran Power Plant Projects Management Company (MAPNA) was founded in 1993 by the Iranian Ministry of Energy. Since 2012, the group has been led by Abbas Aliabadi, former Iranian Deputy Minister of Energy in Electricity and Energy Affairs.

In 2015, MAPNA sealed a USD 2.5 billion contract, Iran’s largest engineering deal to date, to supply Iranian technical and engineering services for the construction of a power station in Basra in southern Iraq.

Mobile Telecommunication Company of Iran (MCI)

A contract to build Syria’s third mobile network (suspended).

MCI is a subsidiary of the Telecommunication Company of Iran (TCI), which is partially owned by the IRGC. MCI brings in approximately 70 percent of TCI’s profits. MCI provides mobile services for over 1,000 cities in Iran and has approximately 66 million Iranian subscribers. It provides roaming services through partner operators in more than 112 countries.

Iranian Companies Active in Syria in 2019

Table 1: List of all Iranian companies with ongoing contracts in Syria - 2019

Name Arabic Name Main Activity Agreement Headquarters Address
Safir Noor Jannat سفير نور جنات Food industries, detergents, and electronics An old MOU dating back to 2015 to supply Syria with flour No. 8, Mohamadzadeh st., Fat-h- highway 4Km. Tehran
Behin Gostar Parsian بهين كستر بارسيان Food industries No information Unit 5. No 14. Shahid Gomnam Street. Fatemi Sq. Tehran

Peimann Khotoot Gostar Company

جزء من مجموعة PARSIAN GROUP

بيهين غوستار بارسيان Electrical power, electronics, and technology 2017 MOU with the batteries companies in Aleppo, the General Company for Metallurgical Industries in Barada, and Sironix, to carry out electricity projects in several locations in Syria. Tehran Province, Tehran, District 22, No: 5, Kaj Blvd, 14947 35511, Iran
Feridolin Industrial & Manufacturing Company شركة فريدولين Electrical appliances No information -----
Tadjhizate Madaress Iran. T.M.I. Co. ---- Decor and furnishings No information No. 198, Dr. Beheshti St., After Sohrevardi Cross Rd., 157783611, Tehran, Iran, Tehran
Trans Boost ترانس بوست Electricity Electrical transformer station (230 66 20 kV) in the Salameh, Hama area ----
B.T.S Company بي تي سي Import and export, and commercial brokerage No information ------
Nestlé Iran P.J.S. Co. شركة نستله Food industries Supply of milk to Syria for the time being 6th Floor, No.3, Aftab Intersection, Khoddami St., Vanak Sq., Tehran, Iran

Recruiting Local Partners (Iran vs. Russia)

Iran and Russia have been competing over the reconstruction of Syria and the potentially lucrative investment opportunities that come with it because both countries hope to recoup some of their outputs from years of supporting the Assad regime and also because both hope to maintain their influence in the post-war era. Both Tehran and Moscow are therefore striving to win over major players in the Syrian political and economic spheres whom they hope to rely on to facilitate their business deals and ensure their respective interests. Consequently, both countries have established economic councils to oversee their ventures and to organize relations with their respective Syrian partners.

The following descriptions of the Syrian-Russian and Syrian-Iranian business councils cover their structures, the total number of members, the most prominent players, and the companies affiliated with their members.

The Syrian-Russian Business Council

The Syrian-Russian Business Council (SRBC) includes 101 Syrian businessmen and a number of Russian counterparts. It is divided into seven committees covering the main sectors of the economy:

  1. Engineering
  2. Oil and gas
  3. Trade
  4. Communications
  5. Tourism
  6. Industry
  7. Transportation

The Syrian membership of the SRBC includes many influential names, as shown in Table 2.

Table 2: Members of the Syrian-Russian Business Council

Notable Names Total Number of Businessmen
Samir Hasan (Chairman, SRBC) 101
Jamal al-Din Qanabrian (Deputy Chairman, SRBC)
Mohammed Abu al-Huda al-Lahham, (Secretary, SRBC)
Fares al-Shehabi (Businessman)
Mehran Khunda (Businessman)
Bashar Nahad Makhlouf (Businessman)

Of these figures, three are particularly prominent:

  • Jamal al-Din Qanabrian has served as a member of the Consultative Council of Syria’s Council of Ministers since 2017 (the Council presents proposals and consultations to the government on economic and legislative affairs). He is also a member of the Damascus Chamber of Commerce and Industry.
  • Samir Hassan, the chairman of the Syrian-Russian Business Council, is a partner in Sham Holding Company, which is owned by Rami Makhlouf.
  • Mohammed Abu al-Huda al-Lahham, also a member of the Damascus Chamber of Commerce, is believed to have strong ties with Dhul-Himma Shalish, the powerful Syrian construction mogul and cousin and personal guard of Hafiz al-Assad.

The SRBC also employs a number of Syrian businessmen of Russian nationality, most notably George Hassouani, who was formerly involved in oil and gas deals with ISIS.

The number of Syrian companies included in the Syrian-Russian Business Council is estimated at 91. These companies are involved in import and export, general trade, textiles, clothing, petrochemicals, energy, and, in a small number of cases, private security operations (see Table 3).

Table 3: Companies in the SRBC

The Syrian-Iranian Business Council

By comparison, Iran has had less success with its business council venture than Russia. The Syrian-Iranian Business Council (SIBC) was established in March 2008, and was initially led by Hassan Jawad. It was reconstituted in 2014 with nine members, as shown below in Table 4.

Table 4: Members of the SIBC

Notable Names Total Number of Businessmen
Samer al-Asaad (President, SIBC) b
Iyad Mohammed (Treasurer, SIBC)
Mazen Hamour (Businessman)
Osama Mustafa (Businessman)
Hassan Zaidou (Businessman)
Khaled al-Mahameed (Businessman)
Abdul Rahim Rahal (Businessman)
Mazen al-Tarazi (Businessman)
Bashar Kiwan(Businessman)

Some of these figures have significant economic influence:

  • Mazen al-Tarazi is a prominent businessman with investments in the tourism sector as well as in real estate (including the project to redevelop Marota City in western Damascus). He has founded a number of companies in Syria, Kuwait, Jordan and elsewhere that offer services in oil well maintenance, advertising, publishing, paper trading, and general contracting. He also owns a number of newspapers, including Al-Hadaf Weekly Classified in Kuwait, Al-Ghad in Jordan, and Al-Waseet in Jordan.
  • Iyad Mohammed is the Head of the Agricultural Section of the Syrian Exporters' Union.
  • Osama Mustafa is a member of the People's Assembly, where he represents Rural Damascus Governorate. He served as Chairman of the regime’s Rural Damascus Chamber of Commerce between 2015-2018.

The number of companies owned by Syrian businessmen who are members of the SIBC board is estimated at 10 (see Table 5).

Table 5: Companies Owned by SIBC Members

Abdul Rahim & Fawzi Rahal Co.

Al-Sharq Bank

Al-Shameal Oil Services Co. 

National Aviation, LLC

Rahal Money Transfer Co. 

Ebdaa Development & Investment Co.

Mazen Hamour International Group

Development Co. for Oil Services

Dagher & Kiwan General Trading Co.

Concord al-Sham International Investment Co.

Because of the relatively small number of Syrian members of the SIBC, Iran is making additional efforts to woe Syrian businessmen. According to private sources, Syrian businessmen are seeking contracts with Iranian companies in return for being granted a share of the value of the contract. Table 6 shows key Syrian figures engaged with Iran.


Table 6: Syrian Businessmen Engaged with Iran

Name Position Name Position

1.Faisal Talal Saif

Head of the Suweida Chamber of Commerce and Industry

2.Mohamed Majd al-Din Dabbagh

Head of the Aleppo Chamber of Commerce

3.Jihad Ismail

Head of the Quneitra Chamber of Commerce and Industry

4.Abdul Nasser Sheikh al-Fotouh

Head of the Homs Chamber of Commerce

5.Tarif al-Akhras

Head of the Deir Ezzor Chamber of Commerce and Industry

6.Osama Mostafa

Head of the Rural Damascus Chamber of Commerce

7.Adeeb al-Ashqar

Merchant from the Damascus Chamber of Commerce

8.Kamal al-Assad

Head of Latakia Chamber of Commerce and Industry

9.Albert Shawy

Merchant

10.Hamza Kassab Bashi

Head of Hama Chamber of Commerce

11.Amal Rihawi

Director of International Relations at the Commercial Bank of Syria

12.Mohammed Khair Shekhmous

Head of the Hasaka Chamber of Commerce and Industry

13.Elias Thomas

Merchant

14.Wahib Kamel Mari

Head of the Tartous Chamber of Commerce and Industry

15.

Merchant

16.Qassem al-Maslama

Head of the Daraa Chamber of Commerce and Industry

17.Saeb Nahas

Merchant

18.Aws Ali

Merchant

19.Ghassan Qallaa

Head of the Federation of Chambers of Commerce

20.Iyad Abboud

General Manager of MOD

21.Louay Haidari

Merchant

22.Ayman Shamma

Merchant

23.Mohamed Hamsho

Secretary-General of the Damascus Chamber of Commerce

24.Bassel al-Hamwi

Merchant

25.Mohamed Sawah

Head of the Syrian Exporters Union

26.Khaled Sukar

Merchant

27.Mohamed Keshto

Head of the Union of Agricultural Chambers

28.Sami Sophie

Director of the Latakia Chamber of Commerce and Industry

29.Marwa al-Itouni

Head of Syrian Businesswomen

30.Salman al-Ahmad

Union of Syrian Agricultural Chambers

31.Mustafa Alwais

Rami Makhlouf 's partner

32.Samir Shami

Syrian Exporters Union

33.Nahed Mortadi

Merchant

34.Gamal Abdel Karim

Merchant

35.Nidal Hanah

Merchant

36.Zuhair Qazwini

Merchant

37.George Murad

Merchant

38.Mohammed Ali Darwish

Merchant

39.Ghassan al-Shallah

Merchant

40.Nasouh Sairawan

Merchant

41.Mousan Nahas

Merchant

42.Anwar al-Shammout

Owner of Sham Wings Co.

43.Mounir Bitar

Merchant

44.Bashar al-Nouri

Merchant

45.Abdullah Natur

Merchant

46.Sawsan al-Halabi

Director of a construction company

47.Tony Bender

Merchant

48.Manaf al-Ayashi

Foodco for Food Industries

49.Maysan Dahman

Merchant

50.Khaled al-Tahawi

Merchant

51.Samer Alwan

Blue Planet Energy Co.

52.Saied Hamidi

Oil and gas sector

53.Roba Minqar

Clothing industry

54.Randa Sheikh

Clothing industry

55.Harout Dker-Mangi

Merchant

56.Alya Minqar

Merchant

Iran’s Role in Key Sectors

Iran seeks to obtain lucrative investment opportunities in different sectors of the Syrian economy, whether through tenders or monopolies. The main sectors in which Iran is trying to get full access are: agriculture, tourism, industry, reconstruction, and private security.

Agriculture

  • Iran’s ability to match Russia’s investments in the Syrian agricultural sector has been significantly limited by the international sanctions imposed upon it. Since 2013 Iran has extended Syria two credit lines with the total value of USD 4.6 billion, aimed mostly at agriculture. Here is a list of Iranian investments in the sector:
  • Supply of wheat since 2015 through the Safir Nour Jannat company"سفیر نور جنت".
  • An agreement with the Syrian government to establish a joint company to export surplus Syrian agricultural products.
  • An investment of USD 47 million for the second phase of implementation of the Iranian credit line to establish a plant to produce animal food, vaccines, and poultry products.
  • A contract to build five mills in Syria at a cost of US 82 million in the provinces of Suweida and Daraa.
  • A Memorandum of Understanding (MOU) with the Syrian General Organization of Sugar (Sugar Corporation) to establish a sugar mill and a sugar refinery in Salha in Hama in 2018.
  • A 2018 MOU between the Federation of Syrian Chambers of Agriculture and the Iranian companies Nero and ITM for the import and distribution of 3,000 tractors.

Tourism

The tourism sector is considered one of the most vital sectors in the Syrian economy: it constituted a 14.4 percent share of Syria’s GDP in 2011 (US 64 billion). It has of course been heavily affected by the war, and tourism revenues decreased from SYP 297 billion (around USD 577 million) in 2010 to SYP 17 billion (around USD 33 million) in 2015, while tourism infrastructure suffered a loss of nearly SYP 14 billion (around USD 27 million) over that same period.

Tehran’s investment in Syria’s the tourism sector has been mostly in religious tourism. For instance, the Syrian Minister of Tourism signed a MOU with the Iranian Hajj Organization in 2015 to bring Iranians and others into Syria for religious tours. There are now estimated to be 225,000 religious tourists from Iran, Iraq, and the Gulf countries visiting Syria each year, and they bring in around SYP two billion (around USD 3.9 million) in revenue.

Industry

The industrial sector contributed 19 percent of Syria’s GDP in 2011, and has suffered losses estimated at USD 100 billion during the war. Iran has several industrial facilities in Syria. These are concentrated in the automobile sector, where they include the Syrian-Iranian International Motor Company and Siamco. Iran has also invested in the glass industry in Adra industrial city. The Iranian Saipa group announced a growth in sales of 11 percent in 2017 in Iraq, Syria, Lebanon, and Azerbaijan. Car sales in Syria reached a significant level: although it was a third of 2018 sales in Iraq so far, 50,000 cars were sold in Syria last year.

Iran has tried to obtain contracts from the Syrian government in the industrial sector, and a number of MOUs have been signed. They include:

  • A 2017 MOU between the Iranian company Bihin Ghostar Persian and General Organization for Engineering Industries to rehabilitate several companies: General Company for Metallic Industries–Barada (located in al-Sabinahis a town in southern Syria, administratively part of the Rural Damascus Governorate), SYRONICS (located in Damascus) and the battery factory in Aleppo.
  • A 2017 MOU between the Syrian Cement and Building Materials Company in Hama and the Yasna Trading Company of Iran for the supply of spare parts.

In 2018, the Syrian-Iranian Business Council submitted a proposal for the participation of Iranian companies in the rehabilitation of Syria’s public industrial sector. In addition, the Iranian Ministry of Industry has expressed a wish to establish a cement production company in Aleppo as part of the second phase of implementation of the Iranian credit line.

Reconstruction and Infrastructure

The construction sector contributed 4.2 percent of Syria’s GDP in 2011 and then suffered a losses of USD 27 billion over the next six years. Syrian infrastructure has taken a similarly heavy hit as a result of the conflict, with losses valued at around at USD 33 billion, including over three million destroyed houses or housing units.

Iran’s interests in reconstruction—as with tourism—have a religious tinge and are mainly focused on the areas around sacred Shi’a shrines. For instance, Iran has been asking the Syrian regime for large concessions in Daraya, the old city of Damascus, Sayida Zainab, and Aleppo. Thus far Iran has mostly relied on Syrian intermediaries to purchase real estate, businessmen such as Bashar Kiwan, Mazen al-Tarazi, Mohammad Jamul, Saeb Nahas, Muhammad Abdul Sattar Sayyid, Daas Daas, Firas Jahm, Nawaf al-Bashir, and Mohammad al-Masha'li. Tehran has also relied on Syrian associations such as Jaafari, Jihad al-Binaa, the al-Bayt Authority, and “the Committee for the Reconstruction of the Holy Shrines" to expand and acquire new land in or near the holy sites in Damascus, Deir Ezzor, and Aleppo.

Sanctions against Syria and their Effect on Iran

The ongoing conflict in Syria has prompted international outcry and condemnation, as well as a long list of "red lines" and sanctions. The sanctions currently in place against Syria include an oil embargo, restrictions on certain investments, a freeze of the Syrian central bank's assets within the European Union, and export restrictions on equipment and technology that might be used for repression of Syrian civilians.

The problem with the sanctions on Syria is that they are ill suited to address the situation, in which sanctions are unlikely to work due to the ongoing war. The EU took significant steps very early in the Syrian conflict, essentially deploying its entire sanctions toolbox in less than one year, in contrast to its more common step-by-step sanctions approach. After a few years, the EU realized that this approach was rushed and ineffective and was forced to backtrack on some measures. This learning process showed the EU that an arms embargo is not necessarily the best first way to address a conflict situation.

Appendix

Syrian Companies Affiliated with Iran

Name Arabic Name Main Activity Agreement

Abdul Rahim & Fawzi Rahal Co.

شركة عبد الرحيم وفوزي رحال معمل مواد بناء، تجارة عامة، استيراد وتصدير حماة/طيبة الإمام، سوريا.
Ebdaa Development & Investment Co. شركة إبداع للتطوير والاستثمار تجارة عامة، استيراد وتصدير ريف دمشق

Development Co. for Oil Services

شركة التنمية لخدمات النفط الخدمات النفطية ------
Obeidi for Construction & Trade شركة عبيدي وشريكه للتجارة والمقاولات تجارة عامة، استيراد وتصدير، المقاولات فندق الداما روز بدمشق
Talaqqi Company شركة تلاقي تجارة عامة، استيراد وتصدير، مستحضرات التجميل دمشق، كفرسوسة، عقار رقم 2463/ 87
Nagam al-Hayat Company شركة نغم الحياة تجارة عامة، استيراد وتصدير، الخدمات الاستشارية ريف دمشق، يلدا/ دف الشوك/ العقار رقم 507
IBS for Security Services ---- --- ---
Al-Hares for Security Services شركة الحارس للخدمات الأمنية خدمات الأمن والحماية الشخصية دمشق
Mobivida L.L.C شركة موبي فيدا تجارة الأجهزة الإلكترونية، الهواتف المحمولة والإكسسوار، وتطوير خدمات الهواتف والإنترنت دمشق
Al-Mazhor Company for Construction شركة المظهور التجارية تجارة عامة، استيراد وتصدير، المقاولات دير الزور
Al Najjar & Zain Travel & Tourism Company شركة النجار وزين" للسياحة والسفر السياحة الدينية نبل، مقابل مستوصف نبل عبارة الضرير / محافظة حلب

 

Top Syrian Businessmen Affiliated with Iran

Under EU Sanctions? Under U.S. Sanctions? Visited Abu Dahbi(UAE) in Jan 2019? Main Position Closeness of Relationship with Iran Name in Arabic Name
- Yes Yes Secretary-General of the Federation of Syrian Chambers of Commerce High محمد حمشو Mohammad Hamsho
- - - Member of Syrian Parliament High حسين رجب Hussein Ragheb
- - - Businessman High حسان زيدو Hassan Zaidou
- Yes Yes Member of Syrian Parliament High محمد خير Muhammad Kheir Suriol
- Yes Yes Member of Syrian Exporters Union High إياد محمد Iyad Muhammad
- Yes Yes Manager of the Federation of Syrian Chambers of Commerce High فراس جيكلي Firas Jijkli
- - - Chairman of the Supreme Committee for Investors in the Free Zone High فهد درويش Fahd Darwish
- - - Syrian Ambassador to Iran High عدنان محمود Adnan Mahmoud
- - - Businessman Medium عامر خيتي Amer Khiti
- - - Businessman High علاء الدين خير بيك Alla Ed din Khair Bik
- - - Businessman Low جورج مراد George Murad
- Businessman Low منير بيطار Munir Bitar
Yes Yes - Works in SDF-controlled area and has relationship with Samir al-Foz High محمد القاطرجي Mohamed al-Qtrji
- - - Businessman High علي كامل Ali Kamil
- - Yes Al-Matin Group General Manager Medium لبيب إخوان Labib Ikhwan
- - - Businessman High سامر علوان Samir Alwan
- - - Businessman Medium ناهد مرتضى Nahid Murtda
- - - Businessman Medium مصان النحاس Musan al-Nahas
- - Yes Businessman High ربى منقار Ruba Munqar
- - - Businessman Low هاروت ديكرمنيجان Harot Dikrmnjyan
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