(MEBG) - Syria announced in late June that it is encouraging international banks to set up branches in free zones under the condition that they invest at least $11 million in equity. These free zones are located in Deraa, Damascus, Aleppo, Tartous and Latakia.
It is expected that Lebanese banks will first enter the market, followed by banks from the Gulf states. Other foreign banks are expected to appraise the situation in light of their colleagues’ experience. However, the proposal that they be based in a free zone should may not be attractive to international banks who want to access the entire Syrian market.
The Syrian banking sector at present offers no automatic teller machines, credit cards and consumer loans, as well as many other financial products of a modern economy. Its banks were nationalized in the 1960s, resulting in a cash economy, where many businesses and individuals choose to keep to place money outside the banks, or in countries such as Lebanon.
For four decade the state has managed the local banking sector through the Commercial Bank of Syria, which currently is upgrading its operation and training its staff with the help of funds from the European Community.