Abu Dhabi, UAEThursday 14 November 2019

Jordanians pin hopes on rebuilding opportunities in Syria

The kingdom's economy is struggling and helping to regenerate its war-torn neighbour could be a lifeline for Jordan's recovery

The old city in Aleppo. Syria. Jordanians sees the rebuilding of the country as an opportunity. AFP
The old city in Aleppo. Syria. Jordanians sees the rebuilding of the country as an opportunity. AFP

Amman // With the Bashar Al Assad regime extending its control over the final cantons in Syria, businesses and policymakers in neighbouring Jordan are making overtures for its reconstruction, pinning their hopes on the post-war rebuild to turn around the kingdom’s worst economic crisis in decades.

After years of their country hosting rebel fighters looking to overthrow the Syrian government, Jordanian MPs, engineers, investors and businessmen have been flocking to Damascus in recent weeks, meeting with regime officials to prepare joint projects for Syria’s rebuild.

They insist it is not wishful thinking; with the kingdom sharing a 380 kilometre border and the only fully-functioning land crossing for Syria, many believe Jordan is poised to be the gateway to Syria’s reconstruction.

“Jordan has a special advantage in the reconstruction of Syria in terms of geographic proximity and expertise,” says Zayyan Zawaneh, Jordanian economic analyst and former adviser to the Central Bank of Jordan.

“Jordan has the proximity and the companies and engineers with the international experience for practically everything Syria needs to rebuild.”

With Syria’s rebuild estimated to cost anywhere between $400 billion to $1 trillion, the chances for economic opportunities in neighbouring Jordan are immense, economists say.

The immediate benefit for Jordan is its construction sector.

The country, which is battling an economic slowdown and an 18.6 per cent unemployment rate, has over 25,000 unemployed engineers and produces several thousand engineering graduates each year who struggle to find work.

Jordan Contractors Association (JCA), meanwhile, warns that due to accumulated debt, investor wariness and a nationwide slowdown in the housing market, up to as many 100,000 employees in the construction sector are in danger of losing their jobs.

A role in the Syrian rebuild would be, as the association says, “a lifeline”.

The Syrian government received the JCA in Damascus last month, where the Syrian minister of public works proposed projects including the reconstruction of roads, bridges, water pipelines, electricity grids and residential buildings.

“We are talking about cities that are 70 per cent destroyed or entirely destroyed, they want Jordanian expertise to help rebuild these cities from scratch,” says JCA president Ahmad Yacoub.

There is also potential demand for Jordanian raw materials.

The country’s five major cement factories have the production capacity of 8 million tonnes per year - twice the domestic demand in Jordan of 4 million tonnes - and has struggled with recent slowing of exports to the West Bank and Iraq.

Syria, meanwhile, used to produce 20 per cent of its own cement, a domestic industry that is now decimated, and will require tens of millions of tonnes of cement to start reconstruction.

In addition to raw materials, machinery ranging from cranes to cement mixers and bulldozers to other, more advanced equipment, are available in Jordan, ready to be rented or sold to Syria.

Even if not a single Jordanian or Arab firm takes part in Syria’s reconstruction, Jordanian policymakers and analysts say the kingdom can benefit immensely as a logistics hub.

Amman, already home to hundreds of foreign companies and regional offices, is 75km from the Syrian border; the Jordanian border town of Ramtha is 110km from Syria's capital Damascus.

Logistically, analysts point out that Jordan’s Red Sea port of Aqaba is the quickest route for equipment and construction materials to Syria from Asia, while the kingdom remains the only fully functioning land border and link between Syria and the Arabian Gulf.

Analysts and officials say the two countries may explore reviving the Hijaz Railway linking Aqaba with Damascus, which had been functioning off and on before the war, as a low-cost land transport option.

“Even if we do not participate directly in reconstruction, logistically Jordan can benefit immensely from Syria’s rebuild - the logistics can move our economy,” says Qais Zayadin, a Jordanian MP who took part in a delegation that met with Mr Assad and government officials in Damascus in November and that are currently meeting with Syrian ministers in a follow-up visit.

Jordan’s skilled workforce can offer trained teams ready for hire for medium and short-term projects by international firms that will take part in Syria’s rebuild who are an hour’s drive from Syria and know the language, the culture, the industry and the terrain.

“Foreign companies looking to rebuild Syria will need employees,” Mr Zayadin said. “Jordanians are bilingual, they know the culture, the customs, the region and are cheaper than importing foreign experts. Jordanians can fill the gaps.”

Jordan exported electricity to Syria throughout the 1980s and part of the 1990s, and the two nations’ grids remain connected; analysts say now the kingdom could literally help power Syria’s rebuild.

Despite the freeze in relations between Jordan and Syria, with Jordan's King Abdullah urging Mr Assad to “step down”, analysts say the “pragmatic” Syrian regime is actively engaging with its neighbour knowing that the kingdom is its first and most realistic option to facilitating its lengthy reconstruction.

“Syria will probably give Jordan a piece of the pie in reconstruction both due to its wants and its needs,” says Fares Braizat, chief executive of Nama Strategic Intelligence Solutions, an Amman-based think-tank. “And at this point it would be out of need more than want.”

For a country that has long benefited economically from its neighbours’ crises, the end to the Syrian war comes at a time when Jordan is particularly vulnerable.

Jordan benefited from both the Iran-Iraq war and post-1991 Gulf War, during which Iraq, then under an economic embargo, fully relied on Jordan for its imports through Aqaba, bringing billions of dollars to the Jordanian economy.

During the Syrian war, however, the closure of the Syrian border, an important trade route, combined with ongoing instability in Iraq devastated Jordan’s transportation, agricultural and industrial sectors.

Following the 1991 Gulf War, Jordan received an influx of 300,000 Palestinians from Kuwait, who brought with them millions of dollars of investment and revived the kingdom’s industrial, business and housing sectors. In contrast, most of the 1.3 million Syrian refugees that fled to Jordan during the Syrian war continue to be aid-dependent and a drain on resources, costing Jordan over $2 billion each year.

Domestic economic policies have done little to alleviate the burden.

The kingdom’s debt level after 15 years of borrowing hovers over 95 per cent of GDP; to stave off insolvency the past two years the government has gutted subsidies and raised taxes and fees multiple times on income and goods ranging from lentils to electronics.

Economic growth sputtered to 2 per cent GDP growth for most of the last decade with few forecasting a near-term improvement.

Unemployment now hovers at 18.6 per cent, it is estimated that over 30 per cent among those aged between 18 and 30 are jobless, driving thousands of protesters to the streets on a nearly-weekly basis over the past year.

This, analysts say, make Syria’s reconstruction all the more vital for Jordan.

“The opportunities of Syria’s reconstruction, combined with the recent reopening of the Iraqi market, could be a major solution to the economic crisis Jordan has suffered the past decade,” Mr Zawaneh said.

Yet Jordan’s greatest strength - cordial ties among all parties involved in Syria - is now the greatest obstacle to Jordan taking a lead on Syria’s rebuild.

Without a political consensus reached by the parties and agreed upon by world powers, any unilateral move by Jordanian leadership to kick off Syria’s rebuild would anger many of its allies, analysts and official sources say.

While Damascus has made several overtures to the kingdom with messages from Mr Assad himself that Syria “is looking forwards, not back” on the enmity during the war and that Syria is anxious to open a new page with Jordan, the Jordanian leadership’s response has been muted.

Jordan has only sent a diplomatic representative to Damascus amid growing calls in Jordan and Syria for ambassadors to be reinstated.

Instead, experts and analysts say Jordan will continue its third-track diplomacy, building ties and preparing joint projects and arrangements on the parliamentary, civil society, business-business and citizen-to-citizen levels.

“This track is effective and is gaining pace - but we need an accelerated, incremental effort to repair ties with Syria to reach the level they need to be for both Jordan and Syria to benefit from the post-war reconstruction,” said Mr Zawaneh.

Updated: February 13, 2019 06:55 PM

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