Outlook for 2011-12

• Despite the threat of contagion from Tunisia and Egypt, the president, Bashar al-Assad, is expected to remain in power in 2011-12. Some limited domestic political reform is expected.
• Syria's domestic economic and political profile is similar to that of Tunisia and Egypt, but there are also major differences. Syria's posture of resistance lends the regime some legitimacy, and fears of sectarian conflict will deter dissent.
• The rapprochement with the US and leading Arab states will be tested by the collapse of the Saudi-Syrian deal to shore up political stability in Lebanon.
• Syrian real GDP growth was an estimated 4% in 2010. We forecast that this will accelerate to an average of 4.6% in 2011-12, driven mainly by private investment in industry, construction, transport and electricity generation.
• The liberalisation, privatisation and diversification of the centrally planned economy will continue, despite opposition within the regime.
• The central government runs a persistent budget deficit, which is expected to average 2.3% of GDP in 2011-12, lower than previously forecast.
• We have raised our forecast for inflation, and expect it to average 7.2% in 2011 as global commodity prices increase, but to fall to 2.4% in 2012 owing to the deflationary effect on rents of Iraqis returning home and a helpful base effect.

Monthly review

• The deal between Syria and Saudi Arabia to shore up political stability in Lebanon has collapsed, after the Lebanese parties failed to agree to marginalise the UN-mandated tribunal into the murder of Rafiq Hariri.
• The "March 8th" bloc has withdrawn from the Lebanese national unity government, prompting its collapse. The nomination of Najib Miqati, who is close to Syria, as prime minister has been greeted by violent Sunni protests.
• Robert Ford has taken up his post as US ambassador to Syria, marking a return to top-level US diplomatic representation after almost six years.
• The government has increased heating fuel (diesel) allowances for state employees and approved means-tested cash benefits to mitigate the effects of increased commodity prices.
• The Credit and Monetary Council has lowered interest rates.
• The consumer price index rose in the final quarter of 2010, driven by a sharp increase in the food and beverages index.
• Egypt-based EFG Hermes, one of the region's largest investment banks, has attracted strong support for a Syria-focused private-equity fund.

Despite the fall of the government in Tunisia and the serious unrest in Egypt in late January, the Economist Intelligence Unit expects the Syrian president, Bashar al-Assad, and his ruling Baath party to retain their grip on the country, supported by key elements in the security services. The core of the elite is drawn largely from Mr Assad's Alawi sect, and any move against him would risk endangering its hold on power. Underlying resentment of Alawi rule and friction between reformers and conservatives mean that tensions within the regime are likely to persist.

Only limited progress is expected on political reform in 2011-12. Although the possibility of domestic dissent will provide the incentive to make at least a few cosmetic changes, it is hard to envisage any steps being taken that would significantly diminish the Baath party's hold on power. Mr Assad initially advocated political reform when he came to power in 2000, but he has acknowledged that the pace of change has been slow since then. He has pledged to increase popular participation in the political process by introducing a political parties law, which will create a second chamber of parliament, the Majlis al-Shura-in addition to the existing lower chamber, the Majlis al-Shaab. He also pledged to devise a local administration law to bring about greater decentralisation. However, the security and intelligence services, which are pervasive and effective, will continue to arrest activists demanding democratic reform, and Syria faces numerous accusations of torture and unfair trial of political prisoners. The various opposition-in-exile groups and domestic critics are unlikely to pose a substantive threat to the government.

Tunisia domino effect: could it happen in Syria?

The fall of the regime of Zine el-Abidine Ben Ali in Tunisia following a month of street protests and the popular revolt against Hosni Mubarak in Egypt have sparked expectations that authoritarian regimes throughout the region, particularly the Arab republics, might be brought down in a domino effect. Syria certainly shares many of the features that fuelled the unrest in Tunisia and Egypt. The young population faces inequality, high unemployment and rising food prices, and there is widespread regional poverty. The country has been run by the same ruling party for four decades, and there is corruption and rent-seeking among those close to the ruling family.

However, there are also significant differences. Although the possibility of tawrith, or dynastic succession, is driving unrest across the region, particularly in Egypt, the fact that the Syrian president, Bashar al-Assad, succeeded his father ten years ago means that he has had the chance to establish his own legitimacy. He is a relatively popular figure, and is supported by multiple intelligence agencies, making a coup unlikely. Syria's posture of resistance towards Israel and Western imperialism also gives the state a popular legitimacy that pro-Western Tunisia and Egypt lack. Unlike relatively homogenous Tunisia, Syria is a melting pot, with a Sunni Arab majority alongside Alawis, Christians, Ismailis, Druze, Kurds and Armenians, as well as Palestinian and Iraqi refugees. There is a fear on all sides that any revolt against the regime could descend into sectarian conflict. The last time the regime was challenged, a Sunni Islamic insurgency ended in the 1982 siege and bombardment of Hama, in which thousands of people died. Syria also lacks the same young, well-educated, but frustrated middle class that it is argued sparked the revolt in Tunisia.

However, the situation is moving fast in Egypt, and if the regime there were to fall, there would be repercussions across the region. Radical change in Syria cannot be ruled out.

The next parliamentary election will be held in April, but Mr Assad's Baath party and its allies are guaranteed two-thirds of the 250 seats, and there is little popular interest, as the primary role of the parliament is to rubber-stamp presidential decrees. The parliament proposes a presidential candidate every seven years who is then voted on in a referendum. Mr Assad was confirmed for his second term as president in 2007.

After a period of diplomatic isolation in 2005-07, Syria has developed steadily better ties with Western and regional states. However, the collapse of the joint Saudi-Syrian initiative to shore up political stability in Lebanon in January will test Syria's relations with Saudi Arabia and the West. The fall of the Lebanese national unity government, and subsequent nomination of Najib Miqati, close to both Hizbullah, a Lebanese militant group and Syrian ally, and Syria, as prime minister of Lebanon, marks greater Syrian involvement in its neighbour, and was met with demonstrations by Lebanon's Sunni community. However, Syria is nervous of Hizbullah's growing power and independence, and Hizbullah is wary of being used as a bargaining chip by Syria.

Despite these developments, the EU is now ready to sign a long-delayed Association Agreement, and final negotiations are ongoing. Relations with the US have also improved, and although US sanctions on Syria were renewed in May 2010, the US has withdrawn its objections to Syria's accession to the World Trade Organisation, and the US ambassador, Robert Ford, finally took up his position on January 16th. However, Syria's continued commitment to a strong relationship with Iran and its support for Hizbullah and Hamas, the Palestinian group that controls Gaza, present ongoing difficulties. There is also opposition to closer ties with Syria within the US Congress-a group of Republican senators are intent on blocking US concessions to Syria. An investigation by the International Atomic Energy Agency into allegations that Syria has a nuclear programme also poses a threat.

Talks with Israel are unlikely to yield results, despite recognition by the US that Syria is important to the peace process. Syria has expressed its willingness to resume peace talks if they are based on Israel's full withdrawal from the Golan Heights (captured from Syria in 1967). However, there is little popular or parliamentary support in Israel for a withdrawal. Syria would be required to end its strategic alliance with Iran and its support for Hizbullah and Hamas, as part of any peace agreement, which would be politically difficult but not impossible.

The gradual liberalisation of Syria's centrally planned economy is expected to continue under the leadership of the deputy prime minister for economic affairs, Abdullah al-Dardari. However, the economic debate remains highly charged, and liberalisation will be hindered by opposition from influential officials. Some within the Baath party are concerned about the negative impact of reform on poverty, and the fear of domestic unrest will probably strengthen their hand. There are also powerful members of the business elite who benefit from the status quo and might resist change.

The overriding policy challenge will be to offset the impact of the long-term trend of declining oil production (despite a small increase in 2010), by developing other sectors of the economy, particularly those that can boost export earnings in the medium term. Moves intended to increase domestic and foreign investment include offering infrastructure investment opportunities to private investors, expanding the Damascus Securities Exchange, relaxing foreign-currency restrictions and boosting bank lending. The introduction of Treasury bills in December 2010 is an indication that financial reforms are moving forward, albeit slowly. Plans to introduce a public-private partnership law to aid financing of investment projects have been announced. There are also plans to cut government subsidies, particularly for fuel, although the government has also increased heating fuel allowances for state employees and approved means-tested cash benefits, partly to soften the impact of the impending price rises.

We have further revised down our forecasts for the budget deficit, following a lower than previously estimated deficit in 2009, as our projections for oil prices and production have increased. The government has announced that it expects the fiscal deficit to average around 6% of GDP in 2010-12. However, government expectations for revenue and oil prices tend to be conservative, and the government also usually fails to disburse its spending allocations fully. We therefore estimate that the budget deficit was 3.2% of GDP in 2010. In 2011 we expect the deficit to contract to 0.6% of GDP, even further below the projections of the government, which has not fully accounted for windfall revenue from converting existing mobile-phone contracts into licences and awarding a licence to a third operator. In 2012 continued strong growth in capital expenditure-in keeping with the government's five-year plan to boost investment-without exceptional increases in revenue will lead to a widening of the deficit to 4% of GDP. Plans to reform public enterprises-most of which are unprofitable-by transforming them into autonomous companies with their own budgets should have a net positive impact on the public finances, and some privatisations are possible.

The Central Bank of Syria is expected to continue to implement monetary reform and gradually gain greater autonomy. The Ministry of Finance has begun issuing Treasury bills to help to establish a local bond market. Interest rates were lowered by 50 basis points in mid-January to stimulate investment, following earlier cuts in January 2009 and August 2010. The authorities seem relatively unconcerned about the rising trend in inflation. To encourage investment, the Central Bank is likely to continue to reduce the restrictions on foreign-currency transactions-two decrees, which facilitated foreign-exchange transactions, were issued in November 2010. All of these measures will help to develop and modernise the banking sector, in which privatised banks (which can now be 60% foreign owned) are playing an increasing role.

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We estimate that real GDP growth reached 4% in 2010, as strong government spending and private consumption supported the economy. The decline in oil production seems to have been at least temporarily reversed, and we forecast growth of 4.6% in 2011 and 2012. Growth will be driven by rising foreign investment as the economy is opened up. This, combined with a government focus on capital spending, will drive growth in fixed investment, although the rate of expansion in government consumption and capital expenditure will slow during 2011-12. Private consumption growth will pick up as the private sector expands and an expected recovery in agriculture in 2011 boosts incomes. However, if there were a significant improvement in security in Iraq a sizeable number of the Iraqi refugees in Syria (estimated at between 500,000 and 1m) might return home, depressing consumption. Growth in trade will also pick up in 2011-12 as Syria becomes more integrated into the global economy. The instability that has affected countries in North Africa could possibly spread to Syria, hindering economic activity (at least temporarily).

On the sectoral side, a poor harvest in 2010 has held back agriculture, with cotton production down by 25%. Although there should be some recovery in 2011-12, water shortages will remain a risk. A government investment drive will boost industry, construction, transport and electricity generation. This will be augmented by investment in the oil and gas sector, which will help to limit declining output in mature fields and boost production in new fields. There will also be a substantial increase in cement production in 2011. Securing finance for some investment projects may be difficult, especially in commercial real estate where there are concerns about overheating. Services will continue to grow, driven largely by a strong increase in tourist arrivals.

Consumer price inflation rose unexpectedly to 6.9% at end-2010, driven by a rise in food and beverage prices, which make up over 40% of the overall index. It is expected to accelerate to an average of 7.2% in 2011, as global commodity prices, particularly of foodstuffs, soar. Average inflation will then ease to 2.4% in 2012, owing to a stabilisation or small decline in the number of Iraqi nationals in Syria, falling commodity prices and a helpful base effect.

The Syrian pound has been loosely pegged to the IMF's special drawing rights since October 2007 and is tightly managed by the Central Bank. The authorities are unlikely to let the pound float freely, as they value exchange-rate stability. Weakness in the euro zone (the euro is a major component of the Central Bank's currency basket) caused the pound to depreciate against the US dollar in the first half of 2010, although it has recovered since, resulting in an average rate of S£46.4:US$1 in 2010. Persistent worries about the euro in 2011 will lead to a slight depreciation of the pound against the dollar, and we forecast that it will average S£46.9:US$1 in 2011-12. The Central Bank has healthy foreign-exchange reserves (equivalent to about 13 months of import cover) leaving it well placed to maintain control of the currency.

In 2011-12 we expect export earnings to grow to an average of US$14.5bn, although this is still below the oil-price-related peak in 2008 of US$15.3bn. In recent years, drought has seriously constrained production, and therefore exports, of cotton and textiles. The drought has now eased, but the 2010/11 wheat crop is expected to be disappointing and a boll weevil infestation has affected the cotton crop.

Oil production, which is increasing at a number of small fields but declining at the larger, mature fields, rose by 2.5% in 2010. Output will pick up further in 2011-12, averaging 392,000 barrels/day. The net impact of changes in oil prices on the trade balance is limited, because Syria's imports of refined products are about equal in value to its exports of crude oil. Higher production in 2011, augmented by a rise in average international oil prices to US$86/barrel in 2011-12 from US$80/b in 2010, will push up crude oil export revenue to an average of US$4.5bn in 2011-12, from US$4bn in 2010. Overall, the trade deficit will narrow to an average of US$345m in 2011-12, or 0.5% of GDP.

The non-merchandise surplus is set to continue expanding in 2011-12 as Syria becomes increasingly integrated internationally. In particular, tourism receipts will grow strongly as a result of improving tourism infrastructure. The non-merchandise surplus is expected to widen. Overall, the current-account surplus will grow to an average of US$1.3bn (1.9% of GDP).

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The reconciliation between Syria and Saudi Arabia, which dates back to January 2009, came under strain at the start of 2011 as their joint initiative to shore up political stability in Lebanon collapsed. The Syrian president, Bashar al-Assad, and the Saudi king, Abdullah bin Abdel-Aziz al-Saud, launched their initiative in Beirut, the Lebanese capital, in July 2010. This followed the threat by Hizbullah, a Lebanese Shia military and political group allied to Iran and Syria, to bring down the Lebanese national unity government if it did not disassociate itself from the UN-mandated tribunal investigating the assassination of Rafiq Hariri, a former Lebanese prime minister, in 2005. Hizbullah's leader, Hassan Nasrallah, made this threat after declaring that he understood that members of his organisation would be indicted for the crime. Over the subsequent months, the Lebanese and Arab media speculated that the initiative would entail a trade-off whereby Saudi Arabia would persuade its ally, the Lebanese prime minister, Saad Hariri (son of Rafiq), to distance himself and the government from the tribunal and to attach no political importance to its findings, while Syria would persuade its allies in Lebanon to remain in the government. Mr Hariri also took steps to reassure Syria, stating in a newspaper interview that he had been hasty in blaming Syria for his father's assassination.

In late December and early January the diplomatic efforts to resolve the issue intensified. Prince Abdel-Aziz bin Abdullah, a son of the Saudi king, shuttled between Damascus, the Syrian capital, and New York (where King Abdullah was convalescing after spinal surgery), and Mr Hariri held a series of meetings with US officials-including the president, Barack Obama-the UN secretary-general, Ban Ki-moon, and King Abdullah's entourage. Shortly before Mr Hariri's meeting with Mr Obama on January 12th, Mr Nasrallah announced that he and the remainder of his "March 8th" bloc had decided to resign from the Lebanese government. This spelled the end of the Saudi-Syrian initiative. The Saudi foreign minister, Prince Saud al-Faisal, made this explicit in an interview with al-Arabiya, a UAE-based television channel, on January 18th, saying that King Abdullah had spoken "head to head" with Mr Assad about the need to foster stability in Lebanon, but when it became clear that a solution was not possible he had decided to "lift his hand" from the question. Prince Saud provided a bleak assessment of what was likely to happen in Lebanon, expressing his fear that the basis for inter-sectarian understanding had been fatally undermined. His remarks suggested strongly that Saudi Arabia was dissatisfied with Syria's contribution to the supposed joint initiative: in Saudi eyes Syria had been either unable or unwilling to put sufficient pressure on its Lebanese allies to make them offer the concessions needed for a compromise solution.

Following the withdrawal of Saudi Arabia from the Lebanese mediation efforts, Mr Assad hosted a meeting of Turkish and Qatari leaders in Damascus to consider a fresh approach. The Turkish and Qatari foreign ministers visited Beirut and held talks with Mr Nasrallah on January 19th, but they departed without making any progress. Mr Nasrallah had made clear that he would not discuss the formation of a new government with Mr Hariri at the helm. The Hizbullah-led March 8th bloc was bolstered by the decision of the Druze leader, Walid Jumblatt, to declare his support for it and Syria. Before the May 2008 crisis, when Hizbullah militiamen overran central Beirut and surrounded Mr Jumblatt's house, the Druze leader (whose father, Kamal, was assassinated in March 1977 after falling out with Syria) had been a solid supporter of Mr Hariri. The Lebanese parliament held a consultation on January 24th and 25th on the appointment of a new prime minister. Owing to Mr Jumblatt's switch, the candidate presented by March 8th, Najib Miqati, a businessman politician from the northern city of Tripoli, won 68 votes, thereby gaining the required majority to be put forward as prime minister by the president, Michel Suleiman.

Mr Miqati has close ties to Mr Assad, and his family company, Investcom, won one of two mobile-phone operating contracts in Syria in 2001, before being acquired by MTN of South Africa in 2006 in a deal worth US$5.5bn. Mr Miqati first entered government at the end of 1998 after the election of Emile Lahoud, a staunch ally of Syria, as president, which triggered the resignation of Rafiq Hariri as prime minister. Mr Miqati served as transport minister and later as public works minister in three cabinets between 1998 and 2005, and was prime minister for a short period after the assassination of Mr Hariri. He has presented himself as a consensus candidate, but he has been described by Saad Hariri's supporters as a representative of Hizbullah and Syria. The sidelining of Mr Hariri provoked an angry reaction from Lebanon's Sunni Muslim community. Syria is likely to be involved in discussions among Lebanese leaders about how to prevent the situation escalating into open sectarian conflict. The next flashpoint is likely to be when the UN tribunal pre-trial judge announces his intentions after reviewing the indictments filed by the prosecutor on January 19th.

Robert Ford arrived in Damascus on January 16th to take up his post as US ambassador to Syria, marking a return to top-level diplomatic representation after almost six years. His predecessor, Margaret Scobey, was withdrawn after the assassination of Rafiq Hariri. Mr Obama nominated Mr Ford in February 2010, but his appointment was delayed owing to congressional opposition on the grounds that it constituted a diplomatic "reward" to Syria for which nothing had been offered in return. The administration insisted that the purpose of upgrading its diplomatic representation was to enable the US to communicate its views about Syria's policies more directly and forcefully. Faced with the likelihood that he would be unable to secure the required Senate ratification, Mr Obama took advantage of the late December recess of Congress to confirm Mr Ford's appointment himself.

The government has increased heating fuel (diesel) allowances for state employees and approved means-tested cash benefits to mitigate the effects of increased commodity prices. An estimated 2m public-sector workers and pensioners will benefit from a 72% increase in their heating allowance to S£1,500 (US$33) per month. The finance minister, Mohammed al-Hussein, said that the overall annual cost would be S£15bn (US$320m). The government's social security fund has also been authorised to disburse between S£500 and S£3,500 per month to 415,000 poorer families, divided into four bands based on their assessed income.

These measures have come amid popular protests in several Middle Eastern countries at increases in food and fuel prices. However, the government has been aware for some time of the need to provide extra benefits for people living in extreme poverty, in particular in the north-east, which has been hit hard by successive years of drought, and its actions appear not to have been merely a reaction to the events in Tunisia. The increase in fuel allowances also appears to have been aimed partly at softening the impact of the impending increases in the price of fuel oil (used mainly by industries) as part of its broader programme of phasing out petroleum price subsidies. From April 1st the price of fuel oil for industrial use is scheduled to rise from S£8,500/tonne to S£13,000/tonne. Further increases are planned, to S£16,000/tonne in January 2012 and S£20,000/tonne in 2013. Finally in 2014, the international market price will apply. The current subsidised price is equivalent to about 30% of the world market price, according to the most recent available figures from Mahrukat, the state fuel-distribution agency.

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The Credit and Monetary Council, affiliated to the Central Bank of Syria, has lowered the reference interest rates on time deposits by 50 basis points. The cut, announced in mid-January, follows a similar reduction in rates in September (October 2010, Economic policy). The new recommended range is 5-7%, depending on the maturity of the deposits. The rate can actually be set plus or minus 2 percentage points from these limits, on the condition that the gap between the lowest and the highest rates provided by a bank for its customers is less than 3 percentage points. The Central Bank has indicated that it views the lowering of rates as a means to stimulate lending for investment, particularly by private-sector banks. According to the most recent monetary survey issued by the Central Bank, as of end-September 2010, the loan/deposit ratio of Syria's private banks was only about 50% (compared with 100% in Jordan). This was higher than in September 2009, when the ratio was 41%, but there is considerable scope for these banks to increase their lending. The authorities have recently opened up more opportunities for the private banks by issuing the first batch of Treasury bills (January 2011, Economic policy) and encouraging some public-sector enterprises to borrow from these banks. The decision to cut deposit rates may have been influenced by the relatively low rates that were quoted in the auctions for the Treasury bills. The rates agreed in the auction for five batches of bills ranged from 1.2% (annualised) for the six-month tranche to 2.84% for the five-year securities. However, the bulk of the bills were allocated to public-sector banks, which quoted aggressively low rates. For the five-year paper, for example, the bids ranged from 2.3% to 7%. The Central Bank does not appear to have been overly concerned by the rising trend of consumer price inflation (see Economic performance).

The consumer price index rose by 3.3% in the final quarter of 2010, bringing year-on-year inflation for the year as a whole to 6.9%, according to figures from the Central Bureau of Statistics. The main reason for this inflationary surge was a sharp increase in the food and beverages index, which rose by 6.2% in the final quarter and by 12.3% over the entire year. Food and beverages has a 41.8% weighting in the index, which was recently rebased to 2005. The government has made a serious effort to improve its data reporting, and this has been particularly noticeable in the promptness of the latest release of the inflation index.

Egypt-based EFG Hermes, one of the region's largest investment banks, has attracted strong support for a Syria-focused private-equity fund and is aiming to close it by mid-2011. The fund will be registered offshore and will operate through a wholly owned affiliate in Syria, which will invest mainly in existing local companies seeking capital and management input to enable them to expand. EFG Hermes is aiming to raise US$250m for the fund.

EFG Hermes announced the launch of the fund in March 2010 in Damascus at the inauguration of a joint-venture investment company, whose local partner is the MAS Economic Group, headed by Firas Tlas, a prominent Syrian businessman. EFG Hermes Syria is established under the capital market law, and has licences to provide advisory, corporate finance, brokerage, research and asset-management services, according to Hazem Badran, its chief executive. The law sets out minimum capital requirements for obtaining licences for these activities, which, in the case of EFG Hermes Syria comes to about US$6m-to obtain the full range of licences from the Syrian Commission on Financial Markets, the total minimum capital requirement is US$17.5m. In mid-2010 the government passed a separate law for the establishment of investment banks, requiring paid-up capital of US$435m for a comprehensive licence including project finance and direct investment in other Syrian companies. No banks have yet sought to obtain a licence to operate under this law, probably reflecting reluctance to commit such a high level of start-up capital.

The EFG Hermes affiliate that would act as the vehicle for the private-equity fund will be established under Investment Law 8, which came into force at the start of 2007 and which covers most economic activities (although not tourism). Several companies in various sectors have already been identified as investment targets. Other investors are also considering the private-equity approach to Syria, including the Gibraltar-based Syria Rising Fund, which is aiming to raise US$100m.

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Please see graphic below

Please see graphic below

Please see graphic below

Land area

185,180 sq km

Population

20.5m (mid-2008 estimate)

Main provinces

Population in millions, 2006

Damascus (capital) area: 4.01

Aleppo: 4.23

Homs: 1.59

Hama: 1.44

Hassakah: 1.33

Idlib: 1.31

Climate

Subtropical on coast, arid in the centre, cold winters in the highlands

Weather in Damascus

Hottest month, August, 18-37°C (average daily minimum and maximum); coldest month, January, 2-12°C; driest month, August, zero average rainfall; wettest month, January, 43 mm average rainfall

Languages

Arabic, French, some English

Religion

Sunni Muslim (72%); Alawi Muslim (14%); Christian (12%); Shia Muslim and Druze minorities

Measures

Metric system

Currency

Syrian pound (S£) = 100 piastres

Time

GMT plus two hours

Fiscal year

January 1st-December 31st

Public holidays

The dates of Islamic holidays are based on the lunar calendar and are therefore approximate. Mawlid al-Nabi (the birthday of the Prophet, February 15th 2011); Eid al-Fitr (August 30th); Eid al-Adha (Feast of the Sacrifice, November 6th); Islamic New Year (November 26th)

New Year's Day (January 1st); Revolution Day (March 8th); Mother's Day (March 21st); Easter (April 4th); Orthodox Easter (April 5th); Independence Day (April 17th); Labour Day (May 1st); Martyrs' Day (May 6th); October Liberation War (October 6th); Christmas Day (December 25th)

Official name

Syrian Arab Republic

Form of state

Republic

Legal system

Based on the constitution of 1973

Legislature

250-member Majlis al-Shaab (People's Assembly) directly elected for a four-year term

Electoral system

Universal adult suffrage

National elections

Next legislative and presidential elections due in 2011 and 2014 respectively

Head of state

President, elected for a seven-year term. The president appoints the vice-presidents, the prime minister and the Council of Ministers. Bashar al-Assad, the current president, is also the commander-in-chief of the armed forces and the secretary-general of the Baath party

Executive

The prime minister heads the Council of Ministers, a large number of whom are drawn from the ruling Baath party and its partners

Main political parties

The ruling National Progressive Front includes the Arab Socialist Baath Party; Arab Socialist Party; Arab Socialist Unionist Party; Communist parties; Syrian Arab Socialist Union Party; Unionist Socialist Democratic Party; Union Socialist Party

Prime minister: Mohammed Naji al-Otari

Deputy prime minister for economic affairs: Abdullah al-Dardari

Key ministers

Agriculture & agrarian reform: Adel Saffar

Awqaf (Islamic endowments): Mohammed Abdel-Sattar al-Sayed

Communications & technology: Imad Abdel-Ghani Sabbouni

Defence: Ali Habib

Economy & foreign trade: Lamiya Assi

Education: Ali Saad

Electricity: Ahmed Qusay Kayyali

Environment (minister of state): Kawkab al-Sabah al-Dayeh

Expatriate affairs: Joseph Sweid

Finance: Mohammed al-Hussein

Foreign affairs: Walid al-Muallim

Health: Rida Said

Higher education: Ghiath Abdel-Wahab Barakat

Housing & construction: Omar Ghalanji

Industry: Fouad Issa Jony

Information: Mohsen Bilal

Interior: Said Sammour

Irrigation: George Soumi

Justice: Ahmed Hamoud Younis

Labour & social affairs: Diyala al-Hajj Aref

Local government: Tamer al-Hijjeh

Petroleum & mineral resources: Sufyan Allaw

Presidential affairs: Mansour Azzam

Tourism: Saadallah Agha al-Qalah

Transport: Yarob Suleiman Badr

Central Bank governor

Adib al-Mayaleh

State Planning Commission

Amer Lutfi