New American restrictions set back trade, net development for at least a year, complicated
requests for export licenses

Dania Saadi
Daily Star staff

DAMASCUS: The US-authored Syria Accountability Act imposing trade sanctions on the country could delay the upgrade of Syria’s internet infrastructure which is in need of American technological equipment, the Syrian Telecommunication Minister Mohammed Bashir al-Mounajed said.
Two weeks ago US President George W. Bush signed into law the Syria Accountability Act, giving him the authority to slap an export ban on US goods imported into Syria, which is blamed by Washington of sponsoring terrorism in the region.
“I expect the act will partially affect the installation of the Public Data Network (PDN) project,” Mounajed told The Daily Star in a recent interview in Damascus.
“The implementation of the act could increase hurdles for us because it gives the US president the option of taking measures that are of his choosing,” he added.
About a year ago the Syrian Telecommunication Ministry started work on installing a PDN, a project that is needed to increase the number of Internet Service Providers (ISP) and the number of internet subscriptions in Syria from the current 150,000.
“We can increase the number of internet subscriptions next year from the current 150,000 ­ which is equivalent to 750,000 users ­ to about 500,000 subscriptions if the PDN project gets going,” said Mounajed.
The minister said the import of the technological equipment from the US had been already delayed due to existing sanctions on importing US technological goods into Syria, which has been on the US list of countries sponsoring “terrorism” since 1979,  with trade sanctions under the US Export Administration Act, which restricts the export of a slew of goods to Syria.
The Syria Accountability Act gives Bush the option to choose two out of six new forms of more stringent sanctions to penalize Syria for opposing the US-led war on Iraq, hosting Palestinian groups opposed to peace with Israel and seeking the development of nonconventional weapons.
“Our PDN project has been delayed by a year now and the main reason for the delay is the technological sanctions imposed on Syria by the US.
“This ban complicated our request for an export license. It takes us four months to get a US export license that other countries can get in two days,” Mounajed said.
But Mounajed’s adviser, Nibal Idilbi, said Syrian officials are still counting on getting the export licenses by the first or second quarter of next year.
“We have begun the process of importing some of the equipment and we hope to get the project running by the first quarter of next year,” said Idilbi.
“The export licenses for some of the equipment were signed before the Syria Accountability Act was passed,” he added.
The state-run Syrian Telecommunication Establishment and the Syrian Computer Society, an association grouping Information Technology companies, are the sole two ISPs operating in Syria under government supervision.
“Once the PDN network is up and running, we expect to grant five to six more ISP licenses to be operated by the private sector,” said Mounajed.
Despite the problems facing the PDN project, Mounajed said the government is working on relaxing internet access restrictions. The government controls the content of the internet through the two existing ISPs.
“We are studying the possibility of easing internet access limitations and we expect things to improve in the next few months,” said Mounajed.
Syria’s internet and telecommunication sector is still in its fetal stage due to a weak infrastructure and few personal computers, which Mounajed put at 400,000 in a country of some 18 million.
“We are trying to increase the number of PCs through the popular PC project that helps buyers pay in installments,” said Mounajed.
Despite the feebleness of the telecom sector, the fledgling mobile phone network is booming and could in a few years outnumber fixed land lines.
“In the space of two years, some 1.1 million mobile phone lines have been sold and we expect the number to grow to 2 million by next year,” said Mounajed.
Mounajed said the ministry is also working on introducing second-generation mobile phones to the market, which has two first generation or GSM (Global System for Mobile Telecommunications) networks.
“I recently discussed with Ericsson in a trip to Sweden the possibility of introducing GPRS (General Packet Radio System) and Wireless Local Loop (WLL),” said Mounajed.
“I think we can expect to have this technology in Syria in one to two years,” he said.
Mounajed said that Sweden-based Ericsson helped start the GSM networks in Syria and is involved in developing the landline network, which has a potential to reach 3.2 million lines, but is close to 2.8 million.
The Syrian government awarded in 2001 two 15-year Build Operate and Transfer contracts to Syriatel, formerly a subsidiary of Egypt’s Orascom Telecom and Spacetel, a subsidiary of Lebanon’s Investcom.
Syriatel and Spacetel were joint ventures with Syrian investors, but Orascom pulled out from the contract in 2003 after it accused its Syrian partners of using political connections. The pullout of Orascom sparked investor fears of bidding for projects in Syria, which is trying to lure investments to funnel cash into its socialist economy.
Mounajed said the dispute was of a personal nature between the Egyptian and Syrian partners.
“To think the dispute between Syriatel and Orascom was blown out of proportion by the media … a settlement has been reached and I don’t think this issue will affect future investments,” Mounajed said.