It has poured billions of dollars and hundreds of lives into bolstering President Bashar al-Assad’s government. Yet Iran may struggle for a return on its investment in Syria. On paper, the Iranian government and entities linked to the Iranian Revolutionary Guards Corps have been granted big economic prizes in Syria — a memorandum of understanding to run a mobile phone operator and a role in one of its most lucrative phosphate mines. It has been given agricultural lands, and plans to develop university branches. But businessmen and diplomats in Syria say implementing those agreements has been stalled by regime officials more eager to attract Russian and Chinese business — and wary of Tehran’s ambitions to increase its influence.
“Just look at the telecoms — they still only have an MOU. It’s been over a year, and they cannot get a deal signed,” one Syrian businessman said.
“The Iranians haven’t gotten anywhere when it comes to making a profit off of Syria.” To friends and foes alike, Iran is often seen as one of the wiliest actors in the Middle East, spreading its influence by developing networks of ideologically like-minded militias. For Iran, Syria is a critical part of its “resistance axis” that extends across Iraq and Syria and to its most powerful regional proxy, Hizbollah, the Lebanese Shia movement, right next to Israel. Its growing presence on Israel’s doorstep is a serious concern for Israel and its western allies, especially Washington: tensions escalated dramatically at the weekend when an Israeli jet was shot down. Israel responded by carrying out its most intense wave of air strikes on Syria in years.
Iran was the first regional power to come to Mr Assad’s aid, and the only one to throw significant manpower behind him — mobilising Hizbollah first, deploying troops, supporting the creation of local paramilitaries and bringing in Shia militias made up of Afghans and Iraqis. But, for all that, some Iranians worry that efforts to benefit from Syrian resources and future reconstruction contracts could be hampered by Damascus’s biggest international backer, Russia. Its 2015 military intervention turned the war decisively in Mr Assad’s favour. Iranian, Russian and European officials all warn that it is far too soon to talk about the potential windfalls of a so-far hypothetical reconstruction, which the UN has estimated as costing about $300bn.
The war between Mr Assad and the rebels who sought his ouster still rages.
Most importantly, it is not clear who would bankroll reconstruction as long as western and Gulf countries — who have the cash to do so but who supported the opposition — stay on the sidelines. Some Russian officials express as much concern about limiting Iranian investments as they do about blocking potential western re-engagement. “Assad is often acting very much in Iran’s interest,” one official said.
“When it comes to potential trade deals and reconstruction, it is therefore vital that we do this in a way that it creates benefits for him, or for people around him . . . but that this remains between him and us — without Iran.” Initial trends, diplomats in Damascus say, already show headaches for Iran. One official who observed recent trade fairs and business expos in Damascus described Iranian companies as “picking up the scraps” compared with firms visiting from China, an economic powerhouse Syria is keen to woo.