Economy

Syria ends tycoon Makhlouf's duty free contracts

By AFP

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A man watches the Facebook video of Syrian businessman Rami Makhlouf on his mobile in Damascus on May 11th. [AFP]

Syria's government has announced the termination of duty-free contracts with companies affiliated with President Bashar al-Assad's billionaire cousin Rami Makhlouf as part of an ongoing spat between the two men.

The economy ministry, in a post Sunday (June 28th) on Facebook, said contracts had been cancelled to manage and operate duty free markets across Syria, including at Damascus airport and border posts with Lebanon and Jordan.

The companies are mostly owned by Makhlouf who presides over an empire of businesses, including Syria's largest mobile operator Syriatel.

A document signed by the state-run General Organisation for Freezones said the contracts were scrapped because of evidence that the main investor was "involved in smuggling goods and money".

It is the Syrian regime's latest move against the businessman who has been embroiled in a power struggle with the state since 2019, when authorities seized control of his charity, Al-Bustan, and dissolved militias affiliated to him.

When the finance ministry in December froze the assets of several businessmen over tax evasion and illicit enrichment, the Syrian press said Makhlouf, his wife and companies were included.

In a bid to replenish state coffers, the regime last month ordered the seizure of assets from Makhlouf and his family.

Days later, Syria's justice ministry announced a travel ban on the tycoon, who is believed to be in the country.

Widening rift

The government has justified its latest measures by claiming Syriatel owes it money, including outstanding fees for maintaining its operating license.

But in a series of controversial videos published last month, Makhlouf disputed such claims, saying some in power were seeking to overthrow him and reap a cut of the company's profits.

The 51-year-old Makhlouf, who himself is under both US and EU sanctions, had been considered to be a pillar of al-Assad's regime ever since the president took over from his father in 2000.

His business empire, estimated to be worth billions of dollars, includes stakes in telecommunications, electricity and real estate.

His dispute with the government comes as the Syrian regime grapples with a severe economic downturn after nine years of war.

The value of the Syrian pound has reached unprecedented lows against the dollar on the black market, sending prices soaring and plunging most of Syria's population into poverty.

Compounding the crisis, new US sanctions against Syria came into force this month, with the first batch of designations targeting 39 people or entities, including al-Assad, his wife Asma and two companies owned by Makhlouf.

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