The political economy of tourism in Syria: state, society, and economic liberalization.

Author:Gray, Matthew

Since his rise to power in 1970, President Hafiz al-Asad has presided over substantial changes to the social, economic, and even the political structure of Syria. The socialist policies of economic development implemented during the 'radical' Ba'ath period (1966-70) have been largely restructured or abandoned, gradually replaced by a more liberal political economy emphasizing economic pluralism (ta'addudiyya). This has included a more balanced relationship between the public and private sectors, with greater cooperation between the two in the form of joint sector enterprises. Under al-Asad, the regime's social priorities have also been transformed, with the regime becoming less reliant on traditional working class bases of support. In the place of a populist orientation, the regime has nurtured and responded to a growth of the middle and professional classes and a small number of very wealthy business elites; groups which have expanded and consolidated their economic position and, as a result, their political influence.

A far more gradual and quiet change in al-Asad's Syria has been the expanding emphasis on, and encouragement of, tourism. Prior to the 1970s, "the tourism industry [in Syria] had hardly existed,"(1) certainly when measured by the number or value of foreign leisure tourists visiting Syria on vacation in the 1990s. Although the Syrian tourism sector remains small compared to other Arab states, especially in its ability to attract wealthy tourists from the Gulf and Europe, it has expanded in size and value since the mid-1970s to become a significant and viable economic activity.

This essay outlines the reasons why the Asad regime has supported and encouraged tourism, the ways in which it has done so, and how the various components of the Syrian political economy have affected the growth and liberalization of tourism. It argues that the regime has nurtured and encouraged tourism through a guided liberalization of the sector, and a 'carrot-and-stick' approach to the economic actors and elites most active and visible in the industry. Political factors have partially stifled the economic potential of tourism, although its contribution to ameliorating economic hardship and stalled development has nonetheless been important. The emphasis of the regime on tourism, and its relations with other actors in the tourism sector, says much about the political economy of the contemporary Middle East, especially about regime responses to changing social and economic conditions.


The Logic of Encouraging Tourism

There are particular reasons why governments throughout the world support the expansion of tourism. First, the potential for tourism to generate foreign currency is important, all the more so in states which have artificial or controlled exchange rates, or which are, often as a result, suffering balance of payments problems. Second is the fact that tourism is labor intensive, and creates employment throughout the economy; tourists spend money on hotels, transport, and meals, but also on a wide variety of goods and services. Third is the fact that the tourism industry does not, on the whole, require expensive or complex technology or a highly skilled workforce. With the exception of a small number of complex projects such as operating an airline, investment in tourism is not comparatively expensive, and will often return a profit reasonably quickly. Finally, many states, including Syria, already have in place the basic and most important requirements for the development of the tourism sector; a pleasant climate, attractive scenery, historical sites, and friendly people. In other words, governments often feel that their state possesses an untapped economic resource, and decide to take advantage of it.

In the case of Syria, these factors are important in explaining the regime's emphasis on tourism. The government's ambitious program of tourism expansion - which includes the creation of 120,000 new jobs in the industry by the year 2000, and the aim to receive five million tourists by 2010 - is an indication of the perceived economic benefits attached to tourism.(2) But more specifically, there are several other reasons why the Asad regime is encouraging tourism. Unlike some other states such as Jordan, Syria's tourist attractions are plentiful, are spread throughout the country and are, for the most part, easily accessible. The sites which are most commonly visited by foreign tourists include the cities of Damascus, Aleppo and Hama, the Roman ruins in the desert at Palmyra, the Crac des Chevaliers in the rural central-west of Syria, the Euphrates River, the Mediterranean coast, and numerous small villages. As a result, foreign (and especially Western) tourists visiting Syria tend to be middle aged, stay longer in Syria than in many other states, have high incomes, travel in groups, and are usually interested primarily in the historical and cultural attractions of Syria. So although Syria receives relatively few Western tourists, perhaps as few as 100,000 a year, these tourists are very lucrative and spend their money throughout the entire country. Since the economic development of rural Syria has been a major goal of successive Ba'athist regimes, including al-Asad's, it may account in part for the emphasis placed on tourism.(3)Further evidence for a rural emphasis in the government's tourism agenda is provided by former Tourism Minister al-Shamat, who stated in 1995 that the regime's primary tourism goals included "Encouraging new styles of tourism such as . . . winter and desert tourism. . . . Celebrating tourism festivals in all seasons [and] . . . encouraging popular and youth tourism. . . ."(4)

A second factor explaining the targeting of tourism by the Asad regime is its politically safe nature. It is politically safe because there are few members of the regime with vested interests in or against tourism, unlike sectors such as agriculture or industry. Further, tourists themselves pose little threat to the stability or popularity of the regime. Tourists rarely have any substantial impact on the politics of the host state. In fact more often than not tourists are kept away from the people in the host state, except for brief, orchestrated meetings such as in the souq.(5) The taking of photographs which depict Syria as an underdeveloped state, or which contain political overtones, are strongly discouraged.

Further, tourism usually contributes to traditional industries, which otherwise may not be viable. Few tourists visit any country - Syria included - without buying a souvenir or momento. Syria, in fact, has become a popular shopping destination, particularly for nationals of Russia and the former-USSR, Iran, and Western Europe. As a mode of development, with positive economic and political implications for the regime, Miyoko Kuroda argues that traditional industries may provide an area in which 'late developers' often have a comparative advantage and in which they usually excel.(6)

Finally, the private sector is relatively eager to enter the tourism sector, and "there is unanimity that the potential is enormous-especially in tourism . . ."(7) The private sector's willingness to invest and participate in tourism is the result of several characteristics of tourism generally, and its treatment under Syrian law in particular. There is the potential for Syrian tourism to continue to expand over the coming years, given that its growth rate between 1986 and 1993 was an impressive 19.6 percent per annum.(8) The private sector is also attracted to tourism by the ease with which the sector can be entered. Start-up times for tourism projects are shorter than for industry, returns are greater than for agriculture, and less specific skills are required to manage tourism projects compared with other sectors. The most important motivation for the private sector, however, has been economic liberalization.

Economic Liberalization and Tourism: The First Infitah (1973-1981)

Under al-Asad, there has been a gradual introduction of economic liberalization to the Syrian political economy. While it has been far less spectacular than the economic opening (al-infitah) in Egypt or Tunisia, a considerable amount of reform has occurred over the past two decades. There have been two main periods with especially rapid or substantial liberalization; the first infitah of the late 1970s, which especially targeted tourism, and the second infitah from the mid-1980s to the present.

The first infitah emerged as al-Asad sought ways to differentiate his presidency from that of his predecessors. Initially reforms were limited in scope, and applied mostly to industrial activity. In 1977 and 1978, however, tourism became a primary focus of economic liberalization, with the creation of mixed sector companies in the industry. Most significant were Law Number 56 of 1977, which led to the formation of the Arab Syrian Company for Touristic Establishments (ASCTE) by the Syrian businessman Uthman A'idi, and Law Number 41 of 1978 which created the Syrian Transport and Tourism Marketing Company (TRANSTOUR) under the prominent businessman Sa'ib Nahhas. A'idi and Nahhas, along with hotel owner Abd al-Rahman al-Attar and a handful of wealthy businessmen in other sectors of the economy, have become known as the "new rich"(9) business elites of Syria, as a result of the favorable treatment received under the laws of the first infitah.

The common characteristics of these laws, and of many which followed in the 1980s, was the creation of mixed sector companies, with the government handing over to the private sector the managerial responsibilities of the enterprise.(10) The government maintained a minimum 25 percent interest in the company, but its role was usually limited to the provision of capital such as land, property, and access to utilities. Such joint ventures enjoyed exemption from the otherwise...

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