Investment Opportunities Guide IN Syria 2011

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Investment Opportunities Guide
                                                                                          Beat Al khebrah
                                                                                                        Syria 2011
                                                                                 Consulting & Studies of Economic
                                                           




                   Investment Opportunities Guide
                                 IN
                        Syrian Arab Republic

                         "A summary of 100 feasibility studies of
                               various economic projects"




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Investment Opportunities Guide
                                                                    Beat Al khebrah
                                                                                  Syria 2011
                                                           Consulting & Studies of Economic
                                     




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Investment Opportunities Guide
                                                                                                                              Beat Al khebrah
                                                                                                                                            Syria 2011
                                                                                                                     Consulting & Studies of Economic
                                                                                               




Table of contents
                                               Contents                                                                                 Page
Introduction                                                                                                                               7
Indicators on the macro-level of Syria                                                                                                     7
Indicators on the micro level                                                                                                              9
Required Permits for Proposed Investment Opportunities in Syria                                                                           25
                         A summary of 100 feasibility studies of various economic projects
                           Project Name                                           Filed                           Suggested location                   Page
Household Electric Appliances except TVs                                industrial / engineering            Deir Ezzor /Industrial City                 29
Requirements of Modern Irrigation                                       industrial / engineering            Deir Ezzor /Industrial City                 34
Materials of Thermal Insulation                                         industrial / engineering            Aleppo / Sheikh Najjar                      39
Medical devices required for clinics and hospitals                      industrial / engineering            Aleppo / Sheikh Najjar                      44
Assembling Busses & Trucks                                              industrial / engineering            Aleppo / Sheikh Najjar                      49
Compressors & Hydraulic Jacks                                           industrial / engineering            Homs / Hsia/                                54
Producing Cement Sleepers (girders) for Railways                        industrial / engineering            Homs / Hsia/                                59
Resistant Glass                                                         industrial / engineering            Homs / Hsia/                                64
Cars Glass                                                              industrial / engineering            Homs / Hsia/                                69
Printing press complex                                                  industrial / engineering            Homs / Hsia/                                74
Foldable Enameled Copper Wires                                          industrial / engineering            Homs / Hsia/                                78
Low and Medium Tension Electric Cables, Specialized Cables              industrial / engineering            Homs / Hsia/                                82
Spare parts for cars (valves, gear boxes and others)                    industrial / engineering            Homs / Hsia/                                88
Household Utensils from Alloys                                          industrial / engineering            Homs / Hsia/                                93
Bricks & TilesAll sizes                                                 industrial / engineering            Homs / Hsia/                                98
Electronic Circuits IT                                                  industrial / engineering            Lattakia                                   102
Micro Controller Programming                                            industrial / engineering            Lattakia                                   106
Wireless receivers" interphone"                                         industrial / engineering            Lattakia                                   111
Furniture for Private Educational Institutions (schools & Universities) industrial / engineering            Damascus Countryside / Adra                115
Ready reinforced concrete, Pre-Cast Concrete                            industrial / engineering            Damascus Countryside / Adra                120
Wall Tanks                                                              industrial / engineering            Damascus Countryside / Adra                125
Electric Elevators                                                      industrial / engineering            Damascus Countryside / Adra                129
Electric Magnetic and Thermal Circuit Breakers                          industrial / engineering            Damascus Countryside / Adra                134
Tin Cans (Conserves)                                                    industrial / engineering            Dara                                       139
Basaltic Wool & Basalt Rods (Iron Alternatives)                         industrial / engineering            Suwaida'a                                  143
Melting Basalt and Manufacturing Basaltic Pipes                         industrial / engineering            Suwaida'a                                  148
Screws and Nuts                                                         industrial / engineering            Qunaiterah                                 153
Concrete Blocks with internal insulation                                industrial / engineering            Qunaiterah                                 157
Veterinary Medicines                                                     industrial / chemical              Al-Hasakah /Industrial City/               162
Gypsum boards                                                            industrial / chemical              Deir Ezzor / Industrial City/              167
Making and Tanning Leathers                                              industrial / chemical              Deir Ezzor / Industrial City/              171
Ammonium Fertilizer/ Urea CO(NH)22                                       industrial / chemical              Deir Ezzor                                 176
Artificial Sponge                                                        industrial / chemical              Deir Ezzor / Industrial City/              181
Plastic Pipes and Accessories for Transporting Drinking Water            industrial / chemical              Aleppo / Sheikh Najjar                     185
Ndustrial Ores Extracted from Consumed and Recycled Lubrication Oils industrial / chemical                  Aleppo / Sheikh Najjar                     190
Raw materials for artificial detergents (sulfonic acid)                  industrial / chemical              Aleppo / Sheikh Najjar                      195
MDF Wood                                                                 industrial / chemical              Aleppo / Sheikh Najjar                      200
Resins of acrylonitrile- Butadiene Styrene (ABC)                         industrial / chemical              Idlib                                       205
A Rubber Mixture for Covering Floors From Recycled Vehicles Tires        industrial / chemical              Hama                                        209
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Investment Opportunities Guide
                                                                                                                              Beat Al khebrah
                                                                                                                                            Syria 2011
                                                                                                                     Consulting & Studies of Economic
                                                                                               




Citric acid                                                             industrial / chemical               Homs / Hsia/                                214
Plastic Granules (Polyethylene, polypropylene, glycol)                  industrial / chemical               Homs / Hsia/                                218
Rubber plates (Nucleate, Eva )                                          industrial / chemical               Homs / Hsia/                                224
Phosphatic Fertilizer TSP                                               industrial / chemical               Homs/ Eastern Mines Zone/                   229
Tires for Cars, Means of Public Transportations and Tractors            industrial / chemical               Homs / Hsia/                                234
Cancer and tumor drugs                                                  industrial / chemical               Damascus Countryside / Adra                 238
 Printing Inks                                                          industrial / chemical               Damascus Countryside / Adra                 243
Medical Gases (Oxygen)                                                  industrial / chemical               Damascus Countryside / Adra                 248
Recycling Household Wastes                                              industrial / chemical               Damascus Countryside / Adra                 252
Carton and Indurate Paper from Remains of Old Paper                     industrial / chemical               Damascus Countryside / Adra                 257
Black Portland Cement                                                   industrial / chemical               Damascus Countryside                        261
Agricultural Sulfur                                                     industrial / chemical               Dara                                        267
Extracting Byrene from Rremains of Oil Squeezing                        industrial / chemical               Dara                                        271
Milk and Babies’ Food                                                   industrial / food                   Eastern Area                                275
Birds Fodder, Poultry Slaughter, Storing & Refrigerating                industrial / food                   Al-Hasakah                                  280
Wheat Mill, Making Macaroni and Vermicelli                              industrial / food                   Al-Hasakah                                  285
Grit and Roasted green wheat (Freekah)                                  industrial / food                   Al-rekah                                    290
Dry yeast                                                               industrial / food                   Al-rekah                                    295
Yogurt and Cheese Automatically                                         industrial / food                   Deir Ezzor /Industrial City/                299
Refinery and purification of edible and industrial salt                 industrial / food                   Deir Ezzor /Industrial City/                304
Squeezing ،filtering, refining and filling in olive oil                 industrial / food                   Aleppo                                      309
Dehydrating Fig and other fruits                                        industrial / food                   Idlib                                       314
Sorting ،Packaging and Storing Vegetables and Fruits                    industrial / food                   Homs                                        319
Non-Alcoholic Beer, Tonic Drink, and non-flavored Soda Water            industrial / food                   Lattakia                                    324
Condensed natural juices of different fruits                            industrial / food                   Lattakia                                    329
Gathering ،Marketing and Manufacturing Milk                             industrial / food                   Coastal Zone                                334
Technical Slaughterhouse of Sheep and Cows                              industrial / food                   Damascus Countryside                        339
Paste of Natural Tomato                                                 industrial / food                   Dara                                        343
Grinding wheat for producing and packing semolina                       industrial / food                   Dara                                        348
Sanitary Tissues out of Bulb                                          industrial / textile                  Eastern Zone                                353
 Jute Sacks                                                           industrial / textile                  Deir Ezzor/ Industrial City/                357
Cotton Underclothes                                                   industrial / textile                  Aleppo / Sheikh Najjar                      361
White Paper and Computer Paper                                        industrial / textile                  Aleppo / Sheikh Najjar                      365
Cow breeding farm and factory to manufacture its products              agricultural / industrial            Al-rekah                                    370
Breeding Fish (pisciculture) in Fresh Water                            agricultural / industrial            Eastern Area                                375
Planting of Overgrowing Trees & Manufacturing Paper Pulp               agricultural / industrial            Deir Ezzor /Industrial City                 379
Planting Soybean & Manufacturing its Derivatives                       agricultural / industrial            Deir Ezzor /Industrial City                 384
A Palm tree Farm / Sorting, Arranging and Storing Dates                agricultural / industrial            Deir Ezzor                                  389
planting ginseng and Producing Herbal Compounds & Creams               agricultural / industrial            Idlib                                       395
Planting Pomegranate & Producing Molasses                              agricultural / industrial            Idlib                                       400
Planting and Dehydrating Onion and Garlic                              agricultural / industrial            Hama                                        405
Apiculture, filtering, pasteurizing and bottling Honey                 agricultural / industrial            Hama                                        410
Fattening sheep & Automatic slaughterhouse                             agricultural / industrial            Hama                                        415
Gathering and Manufacturing Agricultural Remains                       agricultural / industrial            Middle Zone                                 421
hatching ،laying hen breeding, and table egg production and packing    agricultural / industrial             Homs                                       426
Manufacturing and Weaving Silk Threads                                 agricultural / industrial            Tartous                                     431
A Coastal Fish Farm                                                    agricultural / industrial            Tartous                                     436
A Center of Raising Agro-biological Enemies                            agricultural / industrial            Lattakia                                    441
Planting Shrubs of Damascene Flowers and Extracting Aromatic oils      agricultural / industrial            Damascus Countryside                        446

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Investment Opportunities Guide
                                                                                                                             Beat Al khebrah
                                                                                                                                           Syria 2011
                                                                                                                    Consulting & Studies of Economic
                                                                                              




Raising Quail with an Automatic Slaughterhouse                        agricultural / industrial            Dara                                        451
Planting Fodder Materials & manufacturing concentrated fodder agricultural / industrial                    Dara                                        456
Transfer of agricultural remnants,particularly cotton into gas used
                                                                      Renewable energy                     Al Hasaka                                   461
to generate electrical power
Manufacturing Wind Turbines                                           Renewable energy                     Aleppo / Sheikh Najjar                      466
Electro-light collector                                               Renewable energy                     Homs / Hasia                                471
Devices for Water Heating by Solar Energy                             Renewable energy                     Homs / Hasia                                475
Generate Electricity from Solar Energy                                Renewable energy                      Homs /Palmyra                              480
Wind Farms for Generating Power                                       Renewable energy                     Qunaiterah                                  488
Drilling Services and Oil Exploration                                service                               Al Hasaka                                   493
A Health Tourism Resort for Treatment with Olive Oil                 service                               Idleb                                       497
Manufacturing Balloons to be Invested in Sports Activities           service                               Homs /Hasia                                 502
Ornament and Pick-Flowers Nursery                                    service                               coastal area                                508
Producing Movie, TV and Cartoons                                     service                               coastal area                                512
Silo to grain storage                                                service                               Lattakia                                    517
A Specialty Hospital (130) bed                                       service                               Damascus Governorate                        522
A resort of hygienic tourism for treatment with apple & grape juices service                               Al-Sowaida                                  528




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Investment Opportunities Guide
                                                                    Beat Al khebrah
                                                                                  Syria 2011
                                                           Consulting & Studies of Economic
                                     




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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




          Introduction:
          The Syrian government adopted investment as a national and economic goal for
          realizing sustainable development and encouraging the setting up of productive and
          service projects in all fields for creating new job opportunities and raising the standard
          of livings of the citizens. In turn, this will lead to the increase of productive capacity of
          the national economy and encourage the consumption and increase the welfare of all
          citizens. Thus, charged by Beit al-Khebrah for Economic studies and Consultation, the
          Syrian Investment Agency and the Islamic Establishment of Securing Investment and
          Exports Credit has prepared the guide of investment opportunities in the Syrian Arab
          republic.
          This guide includes a brief review of the total economic, social and demographic
          indicators on the level of the country and on the five geographical levels, in addition to
          a summary of 100 feasibility studies selected on the basis of the relative advantages of
          each region through a field study including all the regions of Syria. This summary has
          included a brief marketing study, a technical study and a financial study.

          First: indicators on the macro-level of Syria:
           A. Main geographical and environmental features:
             Location and area:
               The Syrian Arab Republic lies on the eastern coast of the Mediterranean Sea,
               bordered by Turkey from the north, Iraq from the east, Jordan and Palestine
               from the south, Lebanon and the Mediterranean Sea from the west.
               Syria is 18.51 million hectares. About 6 million hectares of which are arable
               lands, and the rest area is not arable. (5.5 million hectares are invested).

                Topography:
                 Syria is divided into four topographic zones:
                 - Coastal zone: It is the area between the mountains and the sea. It includes
                    the two governorates of Lattakia and Tartous.
                 - Mountainous zone: It includes the mountains and the highlands stretching
                    from the north to the south in parallel to the shore of the Mediterranean Sea,
                    including the governorates of Homs, Tarrous, Hama, Lattakia and Edlib.
                 - Interior zone (plains zone): It includes the plains of Damascus, Homs,
                    Hama, Aleppo, Hasakah, and Dara. It is located in the east of mountains
                    zone.
                 - Badiyah (Steppe) zone: It includes the desert plains in the southeast of the
                    country, on the Jordanian Iraqi borders. It comprises parts of Dara, Suwaida,
                    Homs, Hama, Reqah, Deir Ezzor and al-Hasakah governorates.

                Climate:
                 Syria's climate is a Mediterranean Sea like. It is characterized by a rainy winter, a
                 dry summer and two short transitional seasons in between.
                 Syria's climate is divided into five zones as follows:

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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




                     -    The first zone of stability: The rate of its rainfall is more than 350 mm per
                          year. It occupies 14.6% of the total area of Syria.
                     -    The second zone of stability: Its rainfall ranges between 250 – 350 mm. it
                          occupies 13% of the total area of Syria.
                     -    The third zone of stability: Its rainfall reaches 250 mm per year. It occupies
                          7% of the total area of Syria.
                     -    The fourth area of stability (marginal): The rate of its rainfall ranges
                          between 200 – 250 mm. it does not reach less than 200 mm. It occupies 1.8
                          million hectares.
                     -    The fifth area of stability (desert or steppe): All that remains of the
                          territories of Syria. They occupy 55.7 of the total area of Syria.

                   Water:
                    Water in Syria is distributed on a number of basins:
                    Basin of the desert, basin of the coast, basin of Orontes, basin of the Euphrates
                    and Aleppo, basin of al-Yarmouk, basin of the Tigris and al-Khabour, Basin of
                    Barada and al-Awaj,

                   Most important natural resources:
                    The most important extracted resources in 2009 were: phosphate 2,128 million
                    tons, oil 21241 million m3, salt 78 thousand tons, asphalt lime 132 thousand tons,
                    and marble blocks 269,994 tons.

              B. Demographic parameters of population:
                Population and their geographic distribution on the country's level:
                 The registered population of the Syrian Arab Republic in the records of the Civil
                 Status on 1/1/2010 amounted to 23,695 thousand inhabitants, distributed to
                 11,903 thousand males and 11,792 females, while the actual number Syrians who
                 were living in Syria amounted to 20,397 inhabitants, 10,408 thousand males and
                 9,959 thousand females (the population of Syria in 1/1/2011 amounted to 20,866
                 thousand inhabitants. The variance in the number of the population is well noted
                 between the two criteria, where it exceeded 3,328 thousand inhabitants. This
                 number represents the Syrians who are outside Syria, be they migrants or born
                 abroad.
                 The annual growth rate of the total population in Syria amounted to 2.45% and
                 there was a variance from one governorate to another. The lowest growth rate
                 was in Damascus (1.3%) and the highest was in Qunaiterah and Damascus
                 countryside (3.6% and 3.4 successively).

                   Employment and economic activities:
                    The percentage of manpower (15 – 64 years) nearly amounted to 58.8%. This
                    ratio was 58.4 for males and 59.3 for females. The survey of manpower in 2009

          
              central Bureau of Statistics
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                indicated that the number of workers (15 years and over) reached 4,999,229
                inhabitants, 3,548,431 of them in the public sector and 1,442,648 in the private
                sector, in addition to 10,150 in other sectors.
                As for the jobless, they counted 442,953 inhabitants. 317,743 of them did not
                work before. Thus, the unemployment rate was 8.1% in 2009.

          Second: indicators on the micro level:
           A. Geographical features and main environment:
              Eastern region:
             Location and area: It includes the
               governorates of Hasakah, Reqqah and Deir
               Ezzor in the northeast of Syria on an area of
               7601 hectares, forming 41% of the total area
               of Syria.

               Topography:
                Flat plains are spreading on wide areas including the plateaus of al-Jazeerah,
                Euphrates basin and the desert. These plateaus have many low hills and
                mountains like Jabal Abdulazeez, Kojak, Tal Kratshok, Tal Jebsah, Tal Kawkab,
                Jabal al-Minkhar, Twal al-Aba hights, Jabal al-Bishri, in addition to some valleys
                which existed as a result of the Euphrates River, al-Kabour River and others.

               Climate: The zone is featured by the damp western and the northwestern wind in
                winter and the dry wind in summer. Winds are usually loaded with dust,
                especially in the beginnings of autumn. These winds are locally called "ajaj". The
                weather is usually cold in winter and hot in summer. The temperature sometimes
                is below zero, and in summer it usually reaches more than forty centigrade. The
                average rainfall is nearly 200 mm, with the exception of the first and second
                regions of stability in the north next to the Turkish borders.

               Water: The rivers and the dams which are built on rivers are the main sources of
                water in the eastern zone. There are also some springs and wells spreading in the
                area such as:
                 - Euphrates River: It runs all the year round. It starts from the Turkish
                     territories. It runs through Syria at length 610 km. 245 km of which pass in
                     Deir ezzor governorate and 170 km pass in al-Reqqah governorate, where
                     there exists the Euphrates Dam with a storage capacity of 14 billion cubic
                     meters, and al-Ba'ath Dam with a storage capacity of 90 million cubic
                     meters.
                 - Al-Khabour River: It starts out from within the Syrian territories (Ras al-
                     Ain springs). It is 442 km long. It runs through Deir Ezzor at a length of 75
                     km and meets with the Euphrates in al-Busairah village.

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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                 -   Tigris River: It starts out from the Turkish territories and passes 44 km on
                     the Syrian Iraqi borders. By an Arab fund, water from this river will be
                     drawn into al-Hasakah governorate.
                 -   Al-Baleekh River: Its course in al-Reqqah governorate is 135 km long. It is
                     exposed to drought in summer when temperature is too high.

              Northern region:
             Location and zone:
               The northern area includes Aleppo and Edlib.
               It is located in the north of Syria. It is 2460
               thousand hectares. It forms 13.3% of the total
               area of Syria.

               Topography: Aleppo hill occupies a wide
                space of the northern region. It is distinguished
                by its mountainous heights in Efreen, Jabal al-Hoss, Jabal al-Zawiyah, Jabal
                Harem, Barshia, Duwailah, Ain Arab region, Manbej region and plain areas.

               Climate: Winds in this zone are west southern in winter, north western and
                eastern in autumn. It is hot in summer. The average temperature ranges from 29 –
                37° in summer and from 5 - 8° in winter. Rainfalls range from 210 mm in al-
                Safeerah to 800 mm in Jeser al-Shaghour and Edlib.

               Water: This region is rich in surface water which contains some rivers and dams
                such as Teshreen Dam in Aleppo region, Efreen River, Quaiq Rive in Aleppo,
                and Orontes River in Jeser al-Shoghour in Edlib. There are some dams such as
                Teshreen Dam, Shahba'a Dam, Rajo Dam, 17 Neesan Dam, in addition to many
                lakes behind the dams. There are also a lot of springs like al-basoutah in Efreen,
                Abu Qalqal in Manbej, Heilan in Saman, springs of Harem, spring of Ain al-
                Zarqa, spring of al-Debaghah, spring of Ain al- Baidha, and springs of Sheikh
                Issa.

              Middle zone:
               Location and area: It is located in the middle
               of Syria. It comprises Homs and Hama
               governorates. Homs governorate is the largest,
               where it extends on an area of 5110 hectares,
               forming 27.6% of the total area of Syria.
               Planted area covers 705 thousand hectares.

               Topography: This zone is covered by
                mountainous territories in the west such as Hama mountains, chain of northern
                Tadmour mountains (Jabal al-Shajarah, Jabal Balas, Jabal Abu Zhohour, …
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                chain of southern Tadmour mountains (Jabal Antous, Jabal Zubaidah, Jabal al-
                Rammah, …), flat plains in the middle and al-Sham steppe in the east. The zone
                also contains valleys and streams of different depths. The most important of
                which is Orontes River.
               Climate: Homs governorate is characterized by its eastern and northeastern
                winds in winter, and its west and northwestern winds in summer. As for Hama
                governorate, most of its winds are western and southwestern.

               Water: The territories of Homs and Hama governorates are mainly in Orontes
                River Basin. This river is considered the only main river in the middle zone, and
                the second important river in Syria after the Euphrates River in terms of length
                and the annual quantity of water. There are some permanent springs like Ain al-
                Tannour in Homs. As for the springs of Hama, they are mainly in al-Gab and
                Mesiaf region. There are also some natural lakes such as Qatteenah, in addition to
                some artificial lakes formed after building dams such as al-Rastan Lake.

              Coastal Zone:
             Location and area: The coastal area comprises
               Tartous and Lattakia governorates. It is located on
               the eastern coast of the Mediterranean Sea in the
               northwest of Syria. It is 429 thousand hectares,
               forming 2.3% of Syria. The invested area is only
               223 thousand hectares according to the statistics
               of the Ministry of Agriculture in 2009.

               Topography: There is a variance in the topography of the coastal area between
                the beaches, flat plains, hills, heights, chain of high coastal uneven mountains,
                where the highest peak reaches 1800m high. The chain of mountains contains a
                group of valleys with some seasonal and permanent rivers.

               Climate: It is characterized by being moderate all the year round, with a decrease
                in temperature when we get higher from the surface of the sea or move westward.
                The climate of this region is characterized by a relatively high humidity in
                summer.

               Water: This region is located in the basin of the coast. The rainfall is the main
                source of surface water which feeds the ground water of wells and springs. There
                are many rivers such as al-Kabeer River in the north 96 km, and al-Kabeer River
                in the south 56 km, al-Husain River 50 km, al-Ghamgah River 50 km, al-Abrash
                river 4 km, Jober River 33 km, Banias River 23km, As'sen River 6 km. there are


                                                    11
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                 also many dams such as Basel al-Asad Dam, Talhoush Dam, al-Sorani Dam and
                 Khaleefah Dam at a storage capacity of 162.5 million cubic meters.

              Southern Zone:
              Location and area: It comprises five
               governorates: Damascus the capital, Reef
               Demashq (Damascus countryside), Dara,
               Suwaida'a and Qunaiterah. It is located in the
               southeast of Syria. It is 2,925 thousand hectares.
               It forms 15.81% of the total area of Syria. The
               arable land is 697 thousand hectares, but the
               planted lands are 555 thousand hectares.

                Topography: The topography of the southern zone is variant. It comprises the
                 chain of the mountains of east Lebanon: (al-Sheikh Mountain 2814 m, al-Oton
                 Mountain 2615 m, Haleemah Mountain 2464 m, Shqaif Mountain 2462 m), the
                 chain of Qalamoun mountains: (Yabroud Mountain 1884 m. al-Nabek Mountain
                 1851 m, al-Ras al-Aswad mountain 1690, …); chain of al-Arab mountain:
                 (Qiniah hill 1809, Abed Mar hill), in addition to Hauran plateaus , the plateaus
                 of West Ghota and East Ghota, in addition to some heights.

                Climate: Western and southwestern winds loaded with rains in winter are
                 prevalent in Damascus and its rural area, and in Dara and Suwaida'a. As for the
                 northwestern wind, it is moderate, while in summer the eastern winds are dry and
                 hot. The rainfall of this zone is low and irregular except the mountainous regions,
                 Qunaiterah and the part which is located in the first region of stability. In general,
                 the temperature ranges from 18 - 40 in summers, and from 5 – 15 in winters.

                Water: Hydrologically speaking, Damascus and its rural areas are located within
                 the basins of Barada and al-Awaj. The most important resources of water are
                 Feejah spring and Barada spring which end in Otaibah Lake, and al-Awaj River
                 which ends in al-Hijanah Lake. But Dara is located within al-Yarmouk basin. It
                 starts out form Golan, in addition to some springs of different capacity flows,
                 such as Mzeireeb spring, Ghawar, al-Ashari, al-Ajami in Dara, plus Banias River
                 which starts out from the northwest slopes. Many dams have been built on the
                 valleys in Suwaida, Dara and Qunaiterah governorates.




                                                       12
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




           B. Indicators of population and labor force:
              Eastern zone:
               The population of the eastern zone nearly counted 3600 thousand inhabitants on
               1/1/2011: 41.1% are in Deir Ezzor governorate, 33.2% in al-Hasakah
               governorate, 25.7% in al-Reqqah governorate.
               The results of the labor force survey in 2009 indicated that the number of those
               who worked in the eastern zone counted 698 thousand workers. 30% of them
               worked in the agricultural sector, 21.9% in the service sector, 18% in building
               and 8.6% in the industrial sector.
               The unemployed nearly numbered 87 thousand people. The unemployment rate
               was about 12.4%. As for the rate of the females out of the total labor force, they
               were 12.4% and the rate of females who worked remained 90.5%.

              Northern zone:
               The population of the northern area on 1/1/2011 is nearly 6208 thousand
               inhabitants. 76.4% of them are in Aleppo governorate and 23.6% in Edlib.
               The survey of the labor force in 2009 indicated that the number of workers in the
               northern area exceeded 1329 workers. 22.9% of them worked in the industrial
               sector, 18.5 in the sector of restaurants and hotels, 17.4 in the sector of services,
               15.1% in the sector of agriculture and 6.7% in the sector of transportation and
               communication.

              Middle zone:
               The population of the middle zone on 1/1/2011 is almost 3,356 thousand
               inhabitants. They form 16.1% of the population of Syria. 52.5 of them live in
               Damascus governorate and 47.5% live in Hama.
               The workers in the middle zone (from 15 years and over) according to the
               survey of 2009 reached 917 thousand workers. 25.5% of them worked in the
               sector of services, 21.5% in the sector of agriculture, 18.8% in the sector of
               building and 13% in the sector of industry.
               The rate of unemployment exceeded 6.2%, and the rate of females out of the
               total workforce reached 21.6%. As for the employed, the rate nearly remained
               19%, and the rate of the general economic support reached 3.6%.

              Coastal zone:
               The population of the coastal zone on 1/1/2010 numbered 1776 thousand
               inhabitants. They formed 8.6% of the total inhabitants of Syria. 55.8% of them
               lived in Lattakia, and 44,2% of them lived in Tartous.
               The number of workers in the coastal area exceeded 548 thousand workers
               according to the results of the survey of the labor force in 2009. 39.8% of them
               worked in the sector of agriculture. The unemployed in this zone exceeded 116
               thousand people. And the unemployment rate exceeded 17.5%. The rate of
               females out of the labor force reached 32.8%, but the rate of the female workers
               approximately reached 23.8%.


                                                     13
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




              Southern zone:
               The population of the southern zone on 1/1/2011 nearly counted 5,926 thousand
               inhabitants. They approximately formed 28.4% of the population of Syria.
               Almost 45.4% lived in Damascus rural area, 29.6% in Damascus city. 6.2% in
               Dara governorate, 1.4% in Qunaiterah governorate. The annual growth rate
               nearly reached 26%. The highest growth rate was 0.36% in Qunaiterah, 0.34%
               in Damascus rural area, and the lowest growth rate was 0.13% in Damascus city.
               The results of the survey of labor force in 2009 indicated that the number of
               employed workers from 15 years and over in the southern area reached 1,504
               thousand workers. They formed 30% of the total labor force in Syria. About 466
               thousand of them worked in the sector of service, 283 thousand in restaurants
               and hotels, 264 thousand in the sector of industry, 227 thousand in the sector of
               building and construction, 131 thousand in the sector of transportation and
               communication, and 85 thousand in the sector of agriculture. However, the
               unemployed of the southern area exceeded 132 thousand. The unemployment
               rate exceeded 8%.

           C. Basic structure:
              Eastern zone:
              Transportation and communications: The eastern zone has a various road
               networks reaching 20 thousand kilometers in 2009 as stated in the data of the
               Central Bureau of Statistics. About 10.7 thousand kilometers are asphalt; 2.4
               kilometers are central and 8.3 link between cities, towns and villages. They
               connect the governorates with each other and link them with the international
               roads that lead to Turkey and Iraq. As for the telephone lines, they exceeded 376
               thousand, at a rate of one line per 9 individuals.

                Electricity: The eastern zone is almost provided with electricity by main and
                 subsidiary transformation stations in addition to the electricity centers which are
                 distributed all over the region. They are also power plants funded by the
                 Development Arab Economic and Social Funds. The rate of houses which are
                 provided with electricity is 99.7%.

                Health services: According to the statistics of the Central Bureau of statistics in
                 2009, the number of public and private hospitals amounted to 68 hospitals
                 containing 3351 beds, at a rate of one bed for 1046 people. And health centers
                 amounted to 216. The number of doctors exceeded 3147. Dentists counted 1260,
                 and pharmacists approximately counted 1859.

                Drinking water: It is provided to all residential complexes by artesian wells and
                 treatment plants in the cities and villages of the zone. The rate of people who are
                 provided with drinkable water are 92%.


                                                     14
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                Sewage networks: They are available in the major cities, but treatment plants
                 are not available for all these networks. The rate of the people who have access
                 to the sewage networks reached 89%.

                Education: The rate of people who joined education from 6 – 11 years
                 amounted to 94.8%, but the rate of dropout exceeded 6.5%, while the rate of
                 illiteracy from 15 years and over exceeded 30.5%. The rate of those who can
                 read and write from 15 – 24years reached 90.8%. The rate of females versus
                 males in the primary education reached 85.4%.

              Northern area:
              Transportation and communications: The northern zone has a network of
               various asphalt and paved roads, exceeding 18 thousand kilometers. Around 11
               kilometers of which are asphalt. Intercity roads reached 1.4 thousand kilometers.
               And there are 9.6 kilometers connecting the cities, town and villages of this zone
               with the middle, eastern and coastal zone, in addition to Turkey. There are also 6
               thousand paved roads to guarantee the access to the whole agricultural and
               tourist points. There is also Aleppo International Airport and a railway network
               connecting the northern zone with the other regions and with Europe. The
               telephone service is also available. There are 880 thousand lines at a rate of one
               line per 7 people.
              Electricity: All cities, towns and villages of the northern zone are provided
               with electricity centers and electric power stations distributed all over this zone.
               The rate of lighted houses reached 99.7%.

                Health services: The number of public and private hospitals in the northern
                 zone exceeded 148 hospitals as stated by the data of the Central Bureau of
                 Statistics in 2009 at a total capacity of 6619 beds, and at a rate of one bed per
                 914 people. The number of health centers for the same year exceeded 270
                 centers. As for the physicians, dentists and pharmacists they amounted to 6980,
                 3507 and 3816 successively, at a rate of one physician per 867 people and a
                 dentist per 1726 people.

                Drinking water: It is provided to most residential complexes by artesian wells
                 and treatment plants in the cities, towns and villages of the zone. The rate of
                 people who are able to access to the drinkable water is 91.1%.

                Sewage networks: They are available in the major cities of Aleppo governorate,
                 but treatment plants are not available in Edlib. The rate of the people who have
                 access to the sewage networks reached 98.4%.


                                                    15
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                Education: The rate of people who joined education from 6 – 11 years
                 amounted to 97.5%, but the rate of dropout exceeded 9.5%, while the rate of
                 illiteracy from 15 years and over exceeded 20.2%. The rate of those who can
                 read and write from 15 – 24years reached 93.9%. The rate of females versus
                 males in the primary education reached 89.2%.

              Middle zone:
              Transportation and communications: The middle zone has a network of roads
               exceeding 10.4 thousand kilometers. 9.400 kilometers are asphalt. Out of which
               1.500 kilometers are central inside the cities, 8,000 kilometers connect between
               the suburbs and villages. The international road passes through Homs and
               Aleppo and connects them with Jordan, Aleppo and Turkey. There are other
               roads that connect Homs and Hama with the coastal cities, Reqqah, Deir Ezzor
               and Iraq.
               There is also a railway connecting the middle zone with Aleppo and Damascus.
               As for the telephone lines, they reached 663 lines at a rate of one line per 5
               people.

                Electricity: Almost all cities, towns and villages of the middle zone are
                 provided with electricity through electric networks coming from the electric
                 power stations. The rate of lighted houses reached 99.9%.

                Health services: The number of public and private hospitals in the Middle zone
                 amounted to 95 hospitals as stated by the Central Bureau of Statistics in 2009, at
                 a total capacity of 4721 beds, and at a rate of one bed per 695 people. The
                 number of health centers for the same year amounted to 279 centers. As for the
                 physicians, they amounted to 5112, at a rate of one physician per 642 persons,
                 1236 dentists and 1157 pharmacists.
                Drinking water: It is provided to most residential complexes by artesian wells
                 and treatment plants in the cities, towns and villages of the zone. The rate of
                 people who are able to access to the drinkable water is 98.1%: in Homs
                 governorate 99.3%, and in Hama governorate 98.7%.

                Sewage system: It is available in the major cities. In addition, a sewage network
                 was built for draining waste water in each area, town and village whose
                 population exceeded 3 thousand inhabitants. The residents who got access to the
                 sewage system exceeded 99%.

                Education: The rate of people who joined education from 6 – 11 years
                 amounted to 98.6%, but the rate of dropout exceeded 5.7%, while the rate of
                 illiteracy from 15 years and over exceeded 12.4%. The rate of those who can

                                                    16
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                 read and write from 15 – 24 years reached 98%. The rate of females versus
                 males in the primary education reached 92.5%.

              Coastal zone:
              Transportation and communication: The coastal zone is covered by a local
               and international land network which exceeded 7375 kilometers. This network
               links the villages and the cities of that zone, in addition to linking the region
               with the rest of the governorates and the neighboring countries (Turkey and
               Lebanon). There is also a railway line linking Aleppo and Homs governorates.
               There are also two seaports for maritime transport, one in Lattakia and the other
               in Tartous, in addition to Basil Assad Airport. All these networks participate in
               the civil and commercial transportation. As for telephone lines in the coastal
               region, they exceeded 447 thousand lines, at a rate of one telephone line per 4
               people.

                Electricity: All cities, towns, villages and farms are supplied with electricity at a
                 rate of 99% through networks connected with the electric power plants.

                Health services: The number of public and private hospitals in the coastal zone
                 in 2009 amounted to 45 ones, at a capacity of 3330 beds, at a rate of one bed per
                 525 people, in addition to 214 health centers. The number of doctors exceeded
                 4619 physicians and 2099 dentists, at a rate of one physician per 378 people and
                 one dentist per 833 people.

                Drinking water: It is mainly supplied to all residential complexes via springs
                 and rivers. The rate of people who got access to the drinkable water exceeded
                 96.4%.

                Education: The rate of people who joined education from 6 – 11 years
                 amounted to 98.4%, and the rate of dropout did not exceed 2.2%, while the rate
                 of illiteracy from 15 years and over was 10.7%. The rate of those who can read
                 and write from 15 – 24 years reached 98.6%. The rate of females versus males in
                 the primary education reached 94.1%.


              Southern zone:
              Transportation and communications: This zone is served by a spider-like
               network inside the cities. And these cities are connected with other cities by
               international roads (Damascus – Dara – Jordan, Damascus - Beirut, Homs –
               Aleppo – Turkey). Asphalt roads exceeded 6,692 kilometers, and leveled roads
               exceeded 2,254 kilometers, while paved roads exceeded 3,188 kilometers. There
               is also Damascus International Airport. And there are many telephone centers
                                                      17
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                 containing more than 1505 thousand lines in 2009, at a rate of one line per 4
                 people.

                Electricity: It is secured via air networks of low tension fed by electricity from
                 electric power stations, supervised by the General Establishment for Investing
                 Electric Power. The rate of lighted houses by electricity amounted to 99.5%.

                Health service: Based on the statistics of 2009, the public and private hospitals
                 in the southern zone amounted to 135 hospitals, containing 12,435 beds, at a rate
                 of one bed per 465 people, while the number of health centers exceeded 441
                 ones. On the other hand, the number of doctors exceeded 10 thousand physicians
                 at a rate of one physician per 572 people, and 6 thousand dentists at a rate of one
                 dentist per 921 people, and 7 thousand pharmacists.

                Drinking water: It is mainly provided from the water of al-Feejah spring and
                 from many wells in the governorate. As for the drinking water in Damascus
                 rural area, 95% is provided by springs and 5% by wells. In Dara, water is
                 provided at a rate of 33% by springs, and the rest is provided by pumping
                 stations. Suwaida'a mainly depends on the surface dams and springs to cover its
                 needs of drinkable water. The people who had access to the drinkable water
                 exceeded 99% all over the governorates of the zone, with the exception of
                 Damascus countryside, where the rate decreased to 80%.

                Sewage system: The sewage system in Damascus governorate serves all the real
                 estates and building of the governorate. In Damascus countryside, there are
                 sewage networks, but there is no sewage treatment plant. As for Dara, the
                 sewage systems are prevalent in most of the cities and villages of the
                 governorate. There is a water treatment plant in Dara city and in Dael. And
                 there are sewage pumping plants in the cities of Tafas, Harra and Ebta'a. As for
                 Suwaiada and Qunaiterah, there are sewage systems in most cities and villages.
                 The people who could have access to the sewage systems exceeded 98% in
                 Suwaida governorate, and 82% in Qunaiterah governorate.

                Education: The rate of people who joined education from 6 – 11 years exceeded
                 99.2%, and the rate of dropout remained around 4.5%, while the rate of illiteracy
                 from 15 years and over was around 9%. The rate of those who can read and
                 write from 15 – 24years reached 98%. The rate of females versus males in the
                 primary education reached 96%.




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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




           D. Reality of developmental industries:
              Eastern zone:
              Industry and industrial cities: The number of the industrial establishments in
               the eastern zone amounted to 7033 in 2007, where there are many large public
               economic plants. Ahead of which come the plants of extracting oil, gas and the
               relevant industries, in addition to the cotton ginneries, spinning and weaving
               factories, sugar factories, conserves factories, cooling and storage units, silos,
               flour mills, extracting salt and paper making. There are also many industrial and
               service handcrafts, workshops for agricultural tools, workshops of
               manufacturing yogurt, cheese, domestic fat, copper and iron industries, gowns
               and fur industry and others. Seventeen projects in the industrial city (2850)
               hectares in Deir Ezzor were carried out in 2010. Eight projects of them are
               governed by the regulations of encouraging investments. Six of these projects
               are food industries and two chemical industries, the remaining nine projects are
               carried out in accordance with law No./21/ in 1958.

                Agriculture: The eastern zone is considered the first agricultural zone in Syria,
                 where the actual planted area according to the data of the Ministry of Culture
                 and Agrarian Reform exceeded 1601thousand hectares in 2009, which formed
                 36.9% of the total planted area in that year. These areas produced 1642 thousand
                 tons of field crops, 42 thousand tons of vegetables and 15 thousand tons of
                 fruits.

                 The number of cows in the eastern zone exceeded 388 thousand heads, and the
                 heads of sheep exceeded 6160 thousand, while goats exceeded 425 thousand
                 heads.
                  The production of milk nearly reached 647 thousand tons, and the production of
                 red meat reached 88 thousand tons, while poultry meat reached 8 thousand tons.

                Trade: The distinguished location of the eastern zone and the long borders with
                 Turkey and Iraq with which Syria has a large commercial exchange has given
                 this area an important role in activating the movement of common commercial
                 exchanges with these two countries. In addition, the existence of oil wells and
                 the companies of exploring oil and the macro irrigation projects made this zone
                 characterized by good internal markets. There are also wholesale and retail
                 markets, markets specialized in agricultural crops and markets specialized in
                 livestock.

                Tourism: There are 60 hotels in the eastern zone according to the data of the
                 Central Bureau of Statistics in 2009 (28 hotels in al-Hasakah, 23 in Deir Ezzor,
                 9 in al-Reqqah). They contain 3222 beds. The nights of all lodgers amounted to
                 271430 nights, at a rate of 217 nights per bed.

                                                    19
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                 There are hundreds of archeological sites in Deir Ezzor such as Tal Borqus,
                 Arrahbah, Terqa (al-Asharnah), Qarfees (al-Basrah), Mary, Halbyiah and Tal al-
                 Marbeet. In al-Reqqah: Rosafah, Jabar citadel, al-Assad Lake. In al-Hasakah,
                 there are tens of archeological hills such as: Berak Hill, Shagher Bazar Hill,
                 Arbeed Hill, Ain Dewar Bridge, Sakrah Citadle and others.

              Northern zone:
              Industry and Industrial Cities: The northern zone is considered the first
               industrial zone in Syria. Its industrial plants and establishments amounted to
               35,255 in 2007, working in the center field of textile, engineering, chemical and
               food industries. The implemented projects in this zone in 2010 amounted to 333
               according to the statistics of the Ministry of Industry, distributed to 101 textile
               industry projects, 90 engineering industry projects, 85 food industry projects and
               57 chemical industry projects.
               The Industrial city of the northern zone is located in al-Sheikh Najjar, 15
               kilometers northeast of Aleppo city. It extends on 4412 hectares. The projects
               which are governed by the rules of encouraging investment in this city counted
               77 projects during the period from 2004 – 2010). As for the industrial projects
               which are implemented in accordance with law No. /21/ in 1985 during the
               period from      2004 – 2010, they counted 2330 establishments.

                Trade: The northern zone, Aleppo city in particular, is considered an important
                 commercial center for export and import. Aleppo is an internationally deep-
                 rooted market. It contains special markets for wholesale and retail, in addition to
                 semi-wholesale. Retail trade is prevalent all over the cities, towns and villages.
                 And markets are active where through which the needs or cities, towns and
                 villages are provided. The covered market of the city (the longest covered
                 market in the world) is 17 km long.

                Agriculture: Actually planted lands in the northern area were 1464 thousand
                 hectares in 2009, according to the statistics of the Ministry of Agriculture and
                 Agrarian Reform. This area forms 33.7% of the total planted area. The
                 production of the same year reached to 2275 thousand tons of field crops, 982
                 thousand tons of vegetables, while fruitful trees exceeded 729 thousand tons in
                 the same year.
                 The livestock of the northern zone counted 134 thousand heads of cows, 3885
                 thousand heads of sheep, and 316 thousand heads of goats.
                 The production of the milk exceeded 421 thousand tons, distributed to 231 tons
                 of cow milk, 167 thousand tons of sheep milk and 25 thousand tons of goat milk.
                 The production of red meat amounted to 63 thousand tons, distributed to 53
                 thousand tons of mutton, 8 thousand tons of beef, 2 thousand tons of goat meat.
                 The production of poultry meat reached 50.6 thousand tons.


                                                     20
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                Tourism and most important archeological sites: There are 114 hotels at a
                 capacity of 6506 beds. The hotel nights of the lodgers amounted to 1515
                 thousand nights, at a rate of 233 hotel nights per bed. The northern zone is
                 considered rich in its archeological sites. In Aleppo: Aleppo Citadel, Sam'an
                 monastery, Najm Citadel, Ahmar Hill and Maskanah. In Edlib: Ma'arat al-
                 Noman, al-Modon al-Maansiyah , Megara, Serjilan, Ebla and al-hass.

              Middle Zone:
              Industry: The number of industrial establishments in the middle zone amounted
               to 14993 in 2007. This zone won the lion's share of the factories of the public
               sector like Homs Oil Refinery, factory of sugar, factory of yogurt, factory of
               chemical fertilizers, and factory of grains industry.

                 In Hama we have the factory of iron and steel, factory of tires, factory of woolen
                 textile, factory of vegetable oils, factory of fodder, in addition to hundreds of
                 private sector establishments for manufacturing vegetable oils, yogurt, conserves
                 and beverages, as well as the establishments which manufacture fertilizers and
                 veterinary drugs.
                 The middle zone contains Hasia Industrial city, which is 25 km. far from Homs
                 on Homs – Damascus international road. It is 2500 hectares, containing 462
                 establishments until the end of 2010. 144 establishments are under production
                 and 318 are under construction. The investment projects which are performed
                 and included in law No. /21/ of 1985 exceeded 409 establishments. And the
                 other establishments exceeded 94 projects in 2010: 63 projects in Hama
                 governorate and 31 projects in Homs governorate.

                Trade: The location of this zone in the center of Syria added a special
                 commercial advantage. The various agricultural products and the livestock
                 wealth contributed to the spread of wholesale and retail markets in the main
                 cities, towns and villages.

                Agriculture: The actual planted areas in the middle zone exceeded 620
                 thousand hectares in 2009. According to the statistics of the ministry of
                 Agriculture in 2009, they produced 1272 thousand tons of various products; 825
                 thousand tons of grains, 433 tons of vegetables and 580 thousand tons of fruits.
                 Cows counted 209 thousand heads, sheep 5732 thousand heads, and goats
                 exceeded 266 thousand heads.
                  As for milk, the production of this zone amounted to 344 tons of cow milk, 208
                 thousand tons of sheep milk, and 14 thousand tons of goat milk.
                 On the other hand, the production of red meat exceeded 63 thousand tons, and
                 the production of poultry meat exceeded 56 thousand tons.

                Tourism: The middle zone is rich in archaeological areas. In Homs governorate
                 we have the ruins of Palmyra, mosque of Khled Ben Waleed, Qateenah Lake,
                                                    21
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                 the eastern Qaser al-Heer and western Qaser al-Heer, Fakher al-Mani citadel and
                 others.
                 In Hama governorate we have the waterwheels, norias, grave of Abi al-Feda'a,
                 Hayyat mosque, Shazer castle, Afamia and others.
                 The number of working hotels in 2009, as stated in the data of the Central
                 Bureau of Statistic, exceeded 82 hotels at a total capacity of 5153 beds. The
                 number of nights of all lodgers exceeded 1207 thousand nights at a rate of 234
                 hotel nights per bed.

              Coastal Zone:
              The coastal zone witnessed a remarkable development, where the number of if
               industrial establishments amounted to 7843 in 2007. The most important
               existing industries in that zone are: the oil industry, textile industries, foodstuff
               industries, electric motors industries, wood board industry, tobacco industry and
               others. The performed projects in 2010 in this zone amounted to 53 projects
               distributed to 37 foodstuff projects, 8 engineering projects and 8 chemical
               projects.

                Trade: The coastal zone is an important commercial zone because of the
                 existence of the seaports which are considered commercial portals for ships
                 laden with goods from around the world. Ships also leave these seaports
                 carrying Syrian exports.
                 There are many major wholesale markets, in addition to commercial stores
                 spreading in the cities and towns.

                Agriculture: It is one of the important resources for the coastal zone. It is
                 concentrated in the coastal plain and the mountainous terraces which largely
                 depend on planting protected vegetables. The actual planted areas amounted to
                 218 thousand hectares according to the statistics of the Ministry of Agriculture
                 in 2009. They produced 78 thousand tons of field crops, 255 thousand tons of
                 vegetables and 1350 tons of fruits.

                 Cows counted 67 thousand heads, sheep 170 thousand heads, and goats 22
                 thousand heads.
                  As for milk, the production of this zone amounted to 98 tons of cow milk, 7
                 thousand tons of sheep milk, and 2 thousand tons of goat milk.
                 On the other hand, the production of red meat in 2009 was 3.7 thousand tons of
                 beef, 1.6 thousand tons of mutton, and 0.7 ton of goat meat. The production of
                 poultry meat exceeded 27 thousand tons for the same year.

                Tourism: The coastal zone is characterized by being rich in hills, archeological
                 sites and cities such as Ugarit, Castle of Salhuddeen, castle of al-Moniqah, castle
                 of Bani Qahtan, castle of al-Morqob, castle of Yahmour, Safeetah tower, Fort of
                 Solaiman, and others.
                                                      22
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                 There are also many old markets in Lattakia and Tartous, in addition to many
                 tourist and recreation sites on the beach and mountains.
                 The number of hotels in 2009 exceeded 120, at a total capacity of 10,609 beds.
                 The hotel nights of lodgers were 2572, at a rate of 242 hotel nights per bed.

              Southern Zone:
              Industry and industrial cities: The southern zone occupies an advanced
               industrial site, where it embraces the largest number of the industrial companies
               of the public and private sector. The number of registered industrial
               establishments (public and private) approximately amounted to 34,342, working
               in the field of textile, foodstuff, engineering and chemical industries as well as
               the old traditional handcraft industries which depend on the local resources as
               perfumes, soap, glass, dyes, textiles, carpentry, dehydrating fruits, jams and
               dehydrated apricot (locally called qamroddeen).
               This zone contains Adra Industrial City in Damascus rural area. It is 35 km far
               from Damascus city. It is 7,005 hectare, divided into small pieces of land. By the
               end of 2010, the number of its establishments reached 2070. 302 establishments
               are under production and 1768 are still under construction. The projects which
               are governed by the laws of encouraging investments in Adra Industrial City
               during the period 2004 – 2010 amounted to 48, and the projects which are
               governed by law no. /21/ of 1958 amounted to 1349.

                Trade: There are many main important markets for wholesale and retail trade,
                 exportation and importation markets for all industrial and agricultural goods, in
                 addition to the semi-wholesale and retail markets in the other cities and rural
                 areas.

                Agriculture: While trade is the most prominent activity in Damascus city
                 governorate, agriculture is considered the basic activity and the main source of
                 income in the other governorates of the southern zone, where the actual
                 cultivated area amounted to about 330 hectares in 2009. The total production of
                 crops according to the data of the Ministry of Agriculture during the same year
                 amounted to 439 thousand tons of different crops, 728 thousand tons of
                 vegetables and 587 thousand tons of fruits.

                 Cows counted 286 thousand heads, sheep 2,751 thousand heads, and goats 480
                 thousand heads.
                  As for milk, the production of this zone amounted to 525 thousand tons of cow
                 milk, 107 thousand tons of sheep milk, and 29 thousand tons of goat milk.
                 On the other hand, the production of red meat exceeded 41.5 thousand tons. The
                 production of poultry meat exceeded 41.3 thousand tons for the same year.

                Tourism and most important archeological sites: The southern zone is proud
                 of its archeological treasures. In Damascus we have the tomb of Sultan
                                                    23
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                 Salahuddeen al-Ayoubi, al-Azm Palace, the Omayyad mosque, Sulaymaniyah
                 hospice, the national museum, St. Poulus church, Damascus citadel, al-
                 Hmadiyah mrket, Anbar office, tomb of Zeinab, Maaloula, Sednaya, al-Feejah
                 spring, Zabadani. In Qunaiterah, we have al-Hemmah baths and Nemroud castle,
                 Banias and Haramoun mountain. In Suwaida'a, we have the cannals, Shahba,
                 Salkhad. In Dara we have Bosra theater, Tal Shehab waterfalls.
                 The number of hotels in the sothern zone amounted to 311 distributed to 230
                 hotels in Damascus, 66 hotels in Damascus countryside, 11 hotels in Dara, 3
                 hotels in Suwaida and one hotel in Qunaiterah. The number of nights for all
                 lodgers amounted to 6,463 thousand nights at a rate of 254 hotel nights per bed.




                                                    24
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




          Third: Required Permits for Proposed Investment Opportunities in Syria:
            A. Required permits for all sectors:
               1. The decision of inclusion is the first document or the first license granted for
                   the investment projects in Syria. It is issued by the Syrian Investment
                   Agency and its branches. The procedures of inclusion are summarized as
                   follows:
                  - Submitting an application of inclusion according to the accredited form of
                     the agency, including: (data and information about the project owners, data
                     and information about the annual production capacity).
                  - Paying SYP 50,000 as an investment service charge to the cashier desk
                  - The investor must abide by submit the real investment costs during the
                     implementation of the project.
                  For more information visit the agency website: www.investinsyria.org.

                 2. Administrative license:
                     It is issued by the concerned departments in the Ministry of Local Affairs
                     (the governorate, the office of investment services, the municipality or the
                     administrative unit to which the project is affiliated). It needs the following
                     supporting documents:
                    - The application of the administrative license, including: the full name of
                        the applicant, industry or activity, the place to be established on and its
                        boundaries, number of machines and engines, type of machines and how to
                        be used.
                    - The approval of the municipality and that the site to be built is not
                        incompatible with its governing rules.
                     For more information visit: www.damascus.gov.sy

                 3. Building permit:
                     It is issued by the concerned departments in the Ministry of Local
                     Administration. It needs the following supporting documents:
                    - Submitting an application for a building permit in accordance with the
                       approved form of the local administration.
                    - Providing a primary architectural chart.
                    - Providing an assessment study of the environmental impact.
                    - Completing the chart after they are approved and ratified by the
                       Association of Engineers.

                 4. Subscription and allocation: (when investing in the industrial cities):
                     The documents needed to subscribe to an industrial piece of land are:
                    - The decision of inclusion based on the investment decree No. 8 with a
                      feasibility study of the project or an industrial certificate of origin certified
                      by the department of industry on the date of subscription, or a decision for
                                                      25
                                                                                                             
Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                      founding a new industrial establishment (from the one stop shop of the
                      city).
                    - A photocopy of the identity card or the passport for non-Syrians.

                 Allocation is done according to the following preferences:
                    - The decision of inclusion according to the investment law No. /10/ and the
                       decree No, /8/ in 2007.
                    - A newly certified document of an industrial establishment plus a copy of
                       the decision of the administrative license and a pledge to move to the
                       industrial city and close the existing establishment when the new
                       establishment in the industrial city is ready.
                    - The decision of setting up a new industrial establishment.
                     For more information visit the website of the industrial city of Adra: www.a-
                     ic.org

                 5. Permit of drilling and investing a well: (according to the need of the
                     project).
                     To obtain a license to drill and invest a well, the project owner or his/her
                     representative must apply to the concerned department in the Ministry of
                     Irrigation, illustrating the need for drilling a well and the required quantity of
                     water accompanied by a set of supporting documents including:
                    - The decision of inclusion
                    - A newly issued real estate document.
                    - A document about the area of the real estate on which the well will be
                       drilled.
                    - A study from the concerned public department about the quantity of water
                       required for the project.

            B. Key licenses according to the sector of the project:
               1. Decision of the industrial license:
                   The decision is issued by Ministry of Industry in Damascus or its affiliated
                   departments. The industrial decision needs the following supporting
                   documents:
                  - An application submitted by the investor to the concerned department of
                     industry for obtaining an industrial register.
                  - A duly certified administrative decision.
                  - A certificate of the chamber of industry.
                  - A duly certified commercial register.
                  - A duly certified partnership contract (for companies), with photocopies of
                     the partners' ID's or their passports for non-Syrians.
                  - A photocopy of the import licenses and customs clearance documents for
                     the imported machines with catalogues.

                                                      26
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                   - The pictures and bills of the purchased machines from the local market or
                      which are locally manufactured.
                   - Registration stamp duty (SYP 10,000 + 18) to be paid to the Ministry of
                      Finance.
                   - A certificate of an industrial establishment.
                    For more information visit the website of the ministry of Industry
                    www.syrianindustry.org

                 2. Decision of agricultural license:
                     The agricultural decision is issued by the Ministry of Agriculture and its
                     affiliated departments in the Syrian governorates. It passes two stages, initial
                     and final:
                 A. Initial license: It is issued in one day to speed up work. It needs the
                     following supporting documents:
                    - A photocopy of the decision of inclusion.
                    - A list of machinery and equipment.
                    - A photocopy of the identity card or the passport for non-Syrians.
                 B. Final license: It is issued by the concerned governorate, with the exception
                     of the projects of manufacturing fertilizers and organic fertilizers, where they
                     are directly issued by the Ministry of Agriculture. Agricultural activities
                     (vegetal or animal) are subject to certain governing agricultural decisions.
                     The most important decisions:
                       decision No Decision date                    content
                            62/t         25/6/2003      Raising cow and sheep & calf
                            63/t         25/6/2003      Raising sheep and goat
                            83/t          1/1/2006      Raising and fattening camels
                            70/t          1/8/2003      Raising and fattening turkey
                            17/t         19/2/2003      Raising and fattening ostrich
                            38/t         21/6/2001      Raising horses
                            86/t        24/10/2004      Raising bees
                             9/t          3/6/1991      Fish farms
                            26/t        19/10/1991      Plant nurseries
                           261/t        29/11/2007      Olive mills

                     Agricultural projects are exempted from license charges and fees, with the
                    exception of plant raising nurseries, where they pay 10,000.
                    For more information visit the website of the Ministry of Agriculture:
                    www.syrian-agriculture.org

                 3. Decision of health license:
                    The Ministry of Health gives licenses to the factories of medicines and
                    hospitals that fulfill the following conditions:
                    A. The condition for licensing medicine factories:

                                                     27
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                     - Manufacturing in authorized factories should be done under a franchise
                         from well-known international companies duly registered in the Ministry
                         of Health.
                     - Most important pharmaceutical groups: cancer drugs, vaccines, blood
                         derivatives, hormonal drugs in the form of injections, biotechnological
                         and modern medicines in the form of sprays.
                     - The technical conditions of good manufacturing (PGM) must be always
                         updated and realized.
                    B. The conditions for licensing hospitals:
                     - The site of setting up hospitals must be in the identified developing areas
                         in the light of the need.
                     - The building of the hospital must be independent, and the number of beds
                         must be 100 beds at minimum.
                     - There must be one distinguished specialty.
                     - The hospital must be eligible to participate in training and in developing
                         human resources.
                     - The cost of one bed should not be less than 5 million as a building and
                         equipment without the price of the land.
                     - The legal terms and condition that govern the work of hospitals must be
                         implemented.
                    There are also a set of supporting documents required for licensing
                    medicines factories and hospitals requested on stages when the building is
                    still in progress. For more information, visit the website of the Ministry of
                    Health: www.moh.gov,sy

            C. Special approvals according to project activity:
               Some projects need special approvals to start their activities, especially the new
               or strategic ones. For example, the projects of film production need the approval
               of the Establishment of Cinema. The projects of fertilizers need the approval of
               the General Establishment of Chemical Industries, in addition to the approval of
               the Ministry of Petroleum (the General Establishment of Phosphate).

            D. Licenses of border areas:
                In border areas projects need a special approval. Law No. 41 dated on
               26/10/2004 and its amendments in the legislative decree No 49, dated on
               10/9/2008 identified the mechanism of giving this license.
               The service of the one stop shop is available. It provides all the required licenses
               for the investment projects in the headquarters of the Syrian Investment Agency,
               in addition to the four industrial cities (Adra, Sheikh Najjar, Hasia and Deir
               Ezzor).




                                                    28
                                                                                                         
Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                               A Feasibility Study Summary of
                   A Factory of Household Electric Appliances ( except TVs)
                           Deir Ezzor Governorate /Industrial City

          About the project:
           Household electric appliances are no longer luxurious
           requirements; rather they have become basic needs for
           every house. Due to their fast depreciation, they are
           not only linked with the growth rate of houses. They
           are linked with the standards of living and the
           development of requirements and other factors as
           well.
           The project is listed under the engineering industries
           which are eco-friendly, because it will commit to the
           law of the environment which is in effect in Syria.
           The project is suggested to be built up in the industrial
           city of Deir Ezzor.

          First: Marketing Study:
            Product & quality:
             Many kinds of household electrical appliances are available in the market. They
             frequently depend on ill-reputed parts of Asian factories, which led to a decrease of
             trust in these products. This is why we must focus on the quality depending on parts
             of well-known brands of a European origin. In addition, this industry should depend
             on local technical skills in assembling and completing the process of manufacturing.
             The project will present the following high quality products:
              - Air-conditioners
              - Gas & electric stoves
              - Electric hair dryers
              - Electric fireplaces
              - Refrigerators and freezers
              - Automatic and simple washing machines
              - Various electric fans
              - Various vacuum cleaners
              - Meat mincing machine
              - Electric fruit & vegetable mixers
              - Various irons.
              - Water heater
              - Microwave
              - Kitchenware cleaner
                                                     29
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




            Study of the demand
             The demand for electric household appliances is incremental. It appears from its
             relation with the demand for houses which amounted to a growth rate of nearly 1.9%,
             where the residential units in Syria approximately amounted to 4.2 million units.
             Statistics of the State Planning Commission draw the attention to the necessity of
             building 783 residential units as soon as possible, taking into consideration that the
             market needs more houses.
             It is also necessary to refer that the depreciation rate of household electric appliances
             is four times double the depreciation rate of buildings, which confirms that the
             demand rate on the electric household appliances is nearly 7.5% of the annual growth
             of buildings.

            Study of supply:
             There are many local factories producing electric household appliances frequently
             distributed in Damascus, aleppo and Lattakia. On the other hand, the imports of these
             electric appliances in 2010 amounted to 15960 tons at a value of thousand SYP
             1827052.

            Gap between the demand and the supply:
             There is no gap in the very meaning of the word, because the imports cover a large
             important area of the demand, and the growing demand in itself is considered a
             continuous demand to this kind of items.

            Competition & competitors:
             There are many competitors in the Syrian market. The most important are (Al-Hafez,
             Jude, Wattar, Treview, Starmix, Bakiyah, others.). The competition, here, is
             considered full when the market is active and the project share in the market is
             similar to the share of other similar projects.

            Strategies of sale and distribution:
             - 100% of the product will be locally marketed.

          SWOT:
         a. Opportunities and points of strength:
            - The possibility of the availability of raw materials and their being easy to be
               contracted on.
            - The incremental demand for household appliances as a result of the increasing
               demand for houses.
            - The joining of Syria to the Free Arab Trade Organization and the possibility of
               Joining the International Trade Organization , which opens new prospects of
               exportation.
            - The existence of the project in a nascent industrial city increases the facilities
               offered to the project.
                                                  30
                                                                                                                
Investment Opportunities Guide
                                                                                                               Beat Al khebrah
                                                                                                                             Syria 2011
                                                                                                      Consulting & Studies of Economic
                                                                                




         b. Threats & points of weakness:
            - The existence of experts in the Syrian market, and the availability of showrooms
               in strategic places.

            Revenues of the project:
                Description                                  unit    Qty/No.    Price                      total (s.p)
                Air-conditioners                             No       5,000    20,000                     100,000,000
                Gas & electric stoves                        No       3,000    12,000                     36,000,000
                Electric hair dryers                         No       3,000      600                       1,800,000
                Electric fireplaces                          No       3,000    2,500                       7,500,000
                Refrigerators and freezers                   No       2,000    25,000                     50,000,000
                Automatic and simple washing machines        No       3,000    15,000                     45,000,000
                Various electric fans                        No       9,000      800                       7,200,000
                Various vacuum cleaners                      No       3,000    1,200                       3,600,000
                Meat mincing machine                         No       3,000    3,000                       9,000,000
                Electric fruit & vegetable mixers            No       1,500      400                        600,000
                Electric fruit & vegetable squeezer          No       1,500    2,000                       3,000,000
                Various irons.                               No       3,000    2,000                       6,000,000
                Water heater                                 No       2,500    2,000                       5,000,000
                Microwave                                    No       3,000    3,500                      10,500,000
                Kitchenware cleaner                          No       2,000    20,000                     40,000,000
                  Total                                        325,200,000


        Second: Technical Study:
          Technical description of the project:
         a. Location: Deir Ezzor/ industrial city
         b. Land & building: (s.p 30,180,000)
            The factory will be built on an area of no less than 10000m2, fit to the project need at
            a value of s.p. 9,600,000
            The building will be designed according to an internal chart fit to the requirements of
            the production process and the conditions of quality control and storing at a value of
            s.p. 20,580,000.

         c. Machines and equipment: (s.p.87,900,000 of west- European origin)
            The project consists of a group of machines for the process of production as follows:
            - Injection department: a factory for injection and 11 machines for injecting the
              moulds for manufacturing plastic structures.
            - Metal formation department: a group of machines specialized in for forming metal
              plates with different sizes.
            - Production, inspection and quality control department: two buildings for
              production, 7 main production lines, many supplementary lines.
         d. Means of transportation (s.p. 9,200,000)
         e. Furniture: (s,p 1,500,000).

                                                        31
                                                                                                         
Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




         f.    Expenses of incorporation and permits (s.p 6,500,000).
         g.    Commodity requirements: (s.p 254,127,000).
          -    Raw materials : s.p 234,582,00
          -    Other commodity requirements (electricity, water, fuel): s.p 19,545,000.
         h.    Service requirements: (maintenance, mail, telephone, advertisements, promotion,
               (s.p 6,486,000).

         i. Organizational structure, salaries and wages:
            The organizational and administrative structure consists of the following
            departments;
            - Production department: It is responsible for the whole stages of the production
                 process, in addition to the laboratory and the quality section.
            - Promotion and sales department : It is responsible for putting the advertisement
                 and promotional policies, in addition to supervising the process of distribution
                 and foreign contracting.
            - Human resources and financial department: It comprises the financial
                 department, the personal affairs department, drivers and employees.
            The employees needed for the project are estimated at (49 employees, with one shift)
            distributed to 2 administrative employees, 19 experts, technicians and specialized
            workers, in addition to 28 workers and some provisional workers.

        Third: Financial Study:
             Investment costs are estimated as follows:
             - Fixed capital: s.p 135,280,000.
             - Working capital: s.p 23,880,000.

          Annual operating costs are estimated as follows:
          - Commodity requirements: s.p 245,127,000.
          - Service requirement: s.p 6,486,000.
          - Wages and employment: s.p 12,840,000.
          - Depreciations: s.p 13,259,000.
            Variable costs are estimated at s,p 264,451,800. And fixed costs are estimated at s.p
            22,260,200.

             Economic and financial analysis of the project:
             - Total of investment costs = s.p 159,160,000.
             - Value of annual revenues = (the average lifetime of the project is 10 years) = s.p
               409,033,065
             - Total annual costs (the average lifetime of the project is 10 years) = s.p.
               354,884,832


                                                     32
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




             Notice: Revenues are raised 5% and costs are raised 5% during the production
             lifetime of the project.

            Economic parameters of the project:
              a. Total annual profits                            = s.p 67,407,233
              b. Net profits                                     = s.p 54,148,233
              c. Pay-back period                                  = 2.4 years
              d. Rate of return of capital (investment)          = 42%
              e. Net present value at a discount rate of 15%     = s.p (137,871,148
              f. Break-even point                                = 29%
              g. Internal rate of return                         = 35.6%
              h. Added value                                     = s.p. 71,073,000

             The project has a large sensitivity towards the reduction of its revenues at a rate of
             10%, where the internal rate of return reduces to 9.4%.

            Most important required permits:
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Industrial permit
              - Subscription and allotment
              - Building license
              - Administrative permit and ecological consent.
             The industrial cities include the service of the one stop shop, which provides all these
             permits.




                                                      33
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                               A Summary of a Feasibility Study
                              Requirements of Modern Irrigation
                            Deir Ezzor Governorate / Industrial City

           About the project:
              This project is listed under the industrial
              projects. It aims at producing the requirements of
              modern irrigation. Deir Ezzor was chosen as a
              location for the project because the eastern zone
              includes large agricultural areas. On the other
              hand, the transfer to the modern irrigation has
              become inevitable all over the Syrian territories.
              This opens new prospects of a rise of demand for
              the studied project.
          This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
             Product & quality:
              The Syrian government encourages the process of transferance to the modern
              irrigation, because such kind of irrigation saves large quantities of water, and
              effectively helps increasing production. It also minimizes the spread of deceases
              and reduces the use of pesticides and facilitates the distribution of fertilizers and
              nutritious materials. Consequently, it participates in reducing the expenses. The
              project will produce plastic pipes of different sizes, in addition to other accessories
              required for irrigation by sprinkling or distillation, as well as manufacturing plastic
              plates which are used in agricultural greenhouses according to the best standard
              specifications.

             Study of demand:
              The Syrian irrigated area is estimated at 1.2 million hectares. About 22.8% =
              (273,600hectares) of which uses a modern method of irrigation. 63.5% transferred
              to the irrigation by sprinkling and 36.5% by drop irrigation. To complete the
              transference of the remaining areas (926,400) to these methods, Syria needs SYP 29
              billion for the requirements of irrigation by sprinkling and SYP 37 billion for the
              requirements of drop irrigation by distillation.

             Study of supply:
              There are approximately 42 factories of producing the requirements of modern
              irrigation, but their production capacity is still weak, where they do not cover more
              than 30% of the local need. The rest need is covered by importation. The imports of

                                                     34
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




              the requirements of irrigation are estimated at 16,077 tons at a value of SYP
              1,559,229,000.

             Gap between demand supply:
              There is a large gap between the supply and demand estimated at 70% of the annual
              actual need, especially that the demand is increasingly continuous in the coming
              years.

             Competition & competitors:
              There are products for 57 companies displayed in the market; fifteen foreign
              companies. Raisa and Vebra from Sapin are the most important. And there are 42
              national companies: Arrai, Alarabiyah, Ba'albaki, Salsabeel, Ghazal, Zein, Hajjar
              …etc. however, most of them experience practical problems related to the technical
              specifications.

             Strategies of sale and distribution:
          -   Local markets: 100% of the production will be directly sold from the factory or
              distributed to the agriculture tools stores. It could also be linked with the
              agricultural bodies in order to participate in the process of transference to the
              modern irrigation method through selling by installment.
          -   Regional markets: In a later stage.

           SWOT:
           a. Opportunities and points of strength:
          -    The obligatory change to the modern irrigation and the support of the government
              to this approach.
          - There are no similar factories in the eastern zone.
          - The encouragement of state to the private sector and offering exemptions during
              and after starting work, especially to the projects of the eastern zone.
          b. Threats and points of weakness – suggested solutions:
          - The price is influenced by the world fluctuations for being manufactured from oil
             derivatives.
          - The competition of the existing brands in the local market.
          - The imitation of the brand with goods of less quality.

             Revenues of project:
              The annual revenues of the project for producing 64,800,000 m/year of GR and
              2,160,000 k/g of the filters, and 1,080,000 m/ year of pipes are estimated at
              SYP/year 480,000,000.




                                                   35
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          Second: Technical Study:
              Technical description of project:
          a.   Location: The project is located in the eastern zone in the industrial city of Deair
               Ezzor, with the existence of agricultural pieces of land of a large area and the
               inexistence of another factory, in addition to the exemptions for such projects.

          b.   Land and Building: (SYP 77,000,000)
               The project will be built on a piece of land of no less than 7000 m2 at a price of
               SYP 3,500,000. The construction will be built according to an internal chart fit to
               the requirements of the production process and the conditions of controlling quality
               at a cost of SYP 73,500,000.

          c.   Machinery and equipment: (SYP 425,000,000 of a west European origin):
               The project comprises:
               - GR production line.
               - Filters production line.
               - Pipes production line, diameters from 90mm – 160mm.
               - Pipes production line from 32 mm – 90 mm.
               - Machines of injecting metals and plastic for manufacturing and assembling
                 accessories.
               - Electricity generating unit.
               - Laboratory instruments for testing the efficiency of irrigation.

          d. Means of transportation (SYP 10,000,000 )
          e. Furniture and furnishing: (SYP 2,000,000).
          f. Expenses of incorporation (SYP 15,000,000).
          g. Commodity requirements: (SYP 260,000,000).
          -  Raw materials: Plastic granules, accessories required for the process of production,
             packing and packaging materials) = SYP 190,000,000.
          - Other commodity requirements (electricity, water, fuel): SYP 70,000,000.
          h. Service requirements: ((maintenance, mail, telephone, advertisement,
             promotion,…: SYP 30,000,000).

          i.   Administrative and organizational structure:
               The administrative and organizational structure of the project consists of:
          -    Production department: It is responsible for all stages needed for the requirements
               of modern irrigation.
          -    Promotion and sales department: It is responsible for drawing up the advertisement
               and promotional polices as well as supervising the processes of distribution, sales
               and agents, in addition to contracting with the concerned bodies such as the
               agricultural banks and the directorates of agriculture.
                                                     36
                                                                                                              
Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




          -      Human resources and finance department: It comprises the financial directorate
                 (accountant, catchier), personal affairs directorate, drivers and workers, in addition
                 to the concerned transactions.
          -      Laboratory: It is an independent unit affiliated to the general manager. Its task is to
                 make sure of the quality of the products and their compatibility with the standard
                 specifications before they are marketed.

              The employment needed for the project is estimated at 70 workers with one shift,
              distributed to 9 administrative officials, and the others are technicians, production and
              maintenance workers. The total cost of salaries and wages, including social insurances,
              is estimated at SYP 20,000,000.

          Third: Financial Study:
                Estimation of investment costs:
          -      Fixed capital: SYP 529,500,000
          -      Working capital: SYP 91,000,000.

           Estimation of annual operating costs:
          - Commodity requirements (supplies): SYP 260,000,000
          - Service requirements: SYP 30,000,000
          - Wages and employment: SYP 20,000,000
          - Depreciations: SYP: 51,575,000
          Variable costs are estimated at SYP 292,000,000, and fixed costs are estimated at SYP
          69,575,000

             Economic and financial analysis of project:
          -   Total investment costs = SYP 620,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              603,739,000
          - Total annual costs (the average lifetime of the project is 10 years) = SYP
              436,849,000
          Notice: Revenues and costs are raised 5% during the production lifetime of the project
          (10 years).

                Economic parameters of project:
                  a. Annual gross profits                            = SYP 218,464,000
                  b. Net profits                                     = SYP 166,889,000
                  c. Pay-back period                                 = 2.8 years
                  d. Rate of return of capital (investment)           = 35%
                  e. Net present value at a discount rate of 15%     = SYP 358,872,197
                  f. Break-even point                                = 29% = SYP 175,084,000
                                                       37
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                g. Internal rate of return                         = 29.3%
                h. Added value                                     = SYP 220,000,000

          The project is largely sensitive towards the fall of its revenues. If revenues fall 10%, the
          internal rate of return becomes 19.7%.

             Most important required permits:
          -   Industrial permit / Ministry of Industry.
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Subscription and allotment
          -   Building license
          -   Administrative permit and Ecological consent

          The industrial cities include the service of the one stop shop, which provides all these
          permits.




                                                      38
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                              A Summary of a Feasibility Study
                   A Factory for Producing Materials of Thermal Insulation
                     Aleppo Governorate / Industrial City, Sheikh Najjar/
           About the project:
            The project is categorized under the chemical
            industries. It aims at building a factory for producing
            different materials of thermal isolation.
            There is a large need for these materials because of
            the increase of the number of residential and non-
            residential complexes, especially the eco-friendly
            ones which widely depend on thermal insulation.
            This summary includes: marketing study, technical
            study, financial study.

          First: Marketing Study
           Product & quality:
             This project will offer a high quality product of the materials of thermal insulation fit
             to the different requirements. The product will be manufactured according to the
             latest technologies of the good insulation in a way that helps limit the leakage and the
             transition of heat from outside the building to the inside of the building in summer,
             and form its inside to its outside in winter.
              The project will produce the following:
                - Felt: in the form of long thick rolls.
                - Granules of light filling.
                - Foamy liquid.
                - Hard sheets and chips.

              Study of demand:
               Around 110 thousand residential and non-residential units in Syria are being
               licensed. This demand annually increases at a rate of no less than 3% owing to the
               demographic and constructional growth, in addition to the development of the
               demand for the materials of finishing works which have a good insulating feature
               and the modern interest, as it appears in the recommendations of the association of
               engineers and entrepreneurs. The need of the licensed buildings for the materials of
               finishing works is estimated at SYP 22. 74 billion.

            Study of supply:
             Syria imports 27% of its need of the materials of finishing works, and it covers the
             other rate locally but with some difficulty, because of the increasing and continuous
             demand for these materials.

            Gap between demand supply:
             It turns out from what has been mentioned that there is a large gap in favor of the
             demand represented by the imports in addition to the volume of the expected
                                                  39
                                                                                                             
Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                demand in future as a result of licensed building projects which are still in progress
                at present.
            Competition & competitors:
             There are many factories for the materials of thermal insulation such as:
             - The United Company of Insulating Materials.
             - Barakat for Materials of Thermal Insulation.
             - Webtee Company for Materials of Thermal Insulation.
            Strategies of sale and distribution:
             - Local markets: (Damascus, Damascus Countryside, Aleppo) at a rate of 70%
                due to the prosperity of the construction movement in these cities.
             - Regional markets: (Iraq and Turkey) at a rate of 30%.

               SWOT:
              a. Opportunities and points of strength:
                 - The availability of technicians and skilled workers in Aleppo.
                 - The increasing demand for the product which accompanies the development of
                   the methods of construction and finishing works,
                   especially the ecological buildings which basically
                   use Insulation materials.
                 - The wide market of Iraq which is in need of these
                   materials because of the projects of reconstructing
                   Iraq.
              b. Threats and points of weakness:
                - The strong competition, especially the Turkish
                   companies.
                - The fluctuation of the prices of raw materials.
                - The culture of ecological buildings which is still
                   primitive.
                - The inexistence of wide awareness campaigns confirming the importance of
                   thermal insulation and the volume of the economic returns.
            Revenues of project:
          Marketing Product                          Qty     unit      Price                               Total/ SYP
                      felt                           240,000 M2          SYP 100                            SYP 24,000,000
                      Granules of light filling        1,200  ton       SYP 75,000                          SYP 90,000,000
          locally
                      Spray foamy liquid               1,200  ton      SYP 200,000                         SYP 240,000,000
                      Solid sheets and chips         120,000 M2        SYP 400                             SYP 48,000,000
                      felt                            60,000  M2            $3.0                            SYP 8,280,000
                      Granules of light filling         300   ton         $1,700                            SYP 23,460,000
          exportation
                      Spray foamy liquid                300   ton         $4,500                            SYP 62,100,000
                      Solid sheets and chips          30,000  M2            $10                             SYP 13,800,000
             Total         SYP 509,640,000
                                                       40
                                                                                                         
Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          Second: Technical Study
            Technical description of project:
            a. Location: Aleppo city/ Industrial city/ in order to make use of the good
               infrastructure and the prosperity of the motion of building and constructions.

            b. Land and Building: (SYP 160,000,000)
               The factory will be built on a piece of land of no less than 20 dunams (20,000 m2)
               at a value of 40 million Syrian pounds. As for the building, it will comprise
               productive buildings, management buildings, storehouses of raw and ready
               materials, facilities and utilities at a value of SYP 120,000,000.

            c. Machinery and equipment: ( SYP 320,000,000 of a west-European origin ).
               The production line consists of the following sections:
               - Section of receiving different raw materials.
               - Section of supplying mediatory materials.
               - Section of water supplies.
               - Section of melting and kneading.
               - Section of forming fibers, granules, liquids and
                   sheets.
               - Section of conveyer.
               - Section of cooling
               - Section of cutting and final formation.
               - Section of packing
               - Section of controlling.

            d. Means of transportation (SYP 12,000,000)
            e. Furniture and furnishing: (SYP 2,000,000).
            f. Expenses of incorporation and licenses (SYP 6,000,000).
            g. Commodity requirements: (SYP335,000,000 ).
                 - Raw materials: (320,000,000)
                 - Other commodity requirements (electricity, water, fuel): SYP 15,000,000.
             h. Service requirements: (maintenance, mail, telephone, advertisement,
                promotion,…): SYP 32,000,000.
             i. Administrative structure - salaries and wages:
                The administrative and organizational structure of the project consists of:
                 - Production department: It is responsible for production lines, supplying raw
                    materials and quality control.
                 - Promotion and sales: It is responsible for sales, distribution, advertisement
                    and promotion.
                 - Human resources and finance department: It is responsible for designating
                    employees, training them, in addition to the section of funding and accounts.


                                                    41
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                  The employment needed for the project is estimated at 67 workers with one
                  shift, distributed to 5 administrative officials, 37 technicians, maintenance
                  workers and guards. The total cost of salaries and wages, including social
                  insurances, is estimated at SYP 19,800,000.

           Third: Financial Study:
                Estimation of investment costs:
                - Fixed capital: SYP 500,000,000.
                - Working capital: SYP 100,000,000.

               Estimation of annual operating costs:
                - Commodity requirements (supplies): SYP 335,000,000.
                - Service requirements: SYP 32,000,000.
                - Wages and employment: SYP 19,800,000.
                - Depreciations: SYP: 42,000,000.

                Variable costs are estimated at SYP 368,520,000 and fixed costs are estimated at
                SYP 60,280,000.

               Economic and financial analysis of project:
                - Total investment costs = SYP 600,000,000.
                - Value of annual revenues = (the average lifetime of the project is 10 years) =
                  SYP 641,019,715
                - Total annual costs (the average lifetime of the project is 10 years) =
                  SYP 523,800,496.

                Notice: Revenues and costs are raised 5% during the production lifetime of the
                project (10 years).

               Economic parameters of project:
                    a. Annual gross profits                        = SYP 159,219,219
                    b. Net profits                                  = SYP 117,219,219
                    c. Pay-back period                              = 3.8 years
                    d. Rate of return of capital (investment)      = 27%
                    e. Net present value at a discount rate of 15% = SYP 131,525,557
                    f. Break-even point                              =34 %
                    g. Internal rate of return                      = 20.7%
                    h. Added value                                  = SYP 174,640,000

                The project is largely sensitive towards the rise of its variable revenues (pursuant
                to the season) at a rate of 10 %, where the internal rate of return decreases to
                12.2% .



                                                     42
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




             Most important required permits:
              - Industrial permit / Ministry of Industry.
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allocation.
              - Building license.
              - Administrative permit and Ecological consent

              The industrial cities include the service of the one stop shop, which provides all
              these permits.




                                                   43
                                                                                                             
Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                            A Summary of a feasibility study
          About the factory of medical devices required for clinics and hospitals
                  Aleppo Governorate / Industrial City, Sheikh Najjar/

           About the Project:
            Due to the great importance of medical devices being a vital and
            important part in the diagnosis, treatment and prevention of
            diseases, so the importance of establishing a project for
            producing medical devices lies in the fact that being the first and
            the only project of its kind in Syria, which can secure medical
            products and devices, assuring compliance with international
            specifications and safe performance, that guarantee safety of
            patients, devices operators and supervisors of the health sector.
            This corresponds with an emphasis on the existence of this
            project in Aleppo Governorate because of its fame in the field of
            technical industries.
              The project is listed under engineering industries and it will abide by all
              environmental conditions approved for this type of industries.

          First: Marketing Study:
             Product & quality:
              The medical devices are necessary for the prevention,
              diagnosis, treatment and rehabilitation of patients after
              infection, safely and effectively. Clinics and hospitals are
              no longer the only consumer of medical devices, so as a
              result of the scientific and technical development it has
              become possible for the average person to buy some small
              medical devices, which saves him the trouble of going to
              the doctor's clinic.

              The project will provide high quality products of:
              - Quaternary examination device.
              - Special tools set of bandaging
              - Height measuring tool for adults
              - Height measuring tool for kids
              - Midwife case
              - Optometry panel
              - Hammer for knee neurological examination
              - Digital blood pressure gauge
              - Mercuric blood pressure gauge
              - pneumatic blood pressure gauge
              - A stethoscope for adults
              - A stethoscope for kids
              - Used syringes case
              -Kids weight scale
              - Adults weight scale
                                                     44
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




              Study of demand:
               Demand for medical devices appears through a simple analysis of the medical
               profession market on the one hand and number of licensed hospitals in Syria on the
               other hand. Data of the Statistical Abstract of Syria indicating that in 2010, number
               of doctors from different specializations was / 29 927 / and the number of hospitals
               was / 491 /, / 121 / of which public hospitals and / 371 / private hospitals and the
               number of public and private health centers / 1372 / centers. All of these medical
               systems need the project’s products. Also, some families in Syria keep in their
               homes of many types of medical devices, especially families that suffer from
               chronic diseases.

              Study of supply:
               The supply available in S
               yria is from imports only where there isn’t y any local producer of such devices.
               Supply of medical devices in Syria is suffering from entering cheap products of
               unknown origin leading to a lack of confidence in these products.

              Gap between demand and supply:
               Demand in Syria met by imported products where there is no locally produced
               medical devices.

              Competition and competitors:
               The imported medical devices considered as a real competitor, especially products
               of Western or Japanese origins, where competition here can be in prices, but for
               low quality products there’s no competition in prices where quality here is what
               looked for. Briefly, we can say that the project offers high quality products at
               reasonable prices.

              Strategies of sale and distribution:
               100% of production will be locally marketed in the internal markets (hospitals and
               clinics).

              (SWOT):
               a. Opportunities and points of strengths:
                  - The possibility of importing raw materials at reasonable prices.
                  - The increasing demand for products of the project in parallel with the evolution
                    of the number of licenses to clinics and hospitals.
                  - Joining the Arab Free Trade Area by Syria could open new horizons for export.
              b. Threats and points of weaknesses:
                  - Imports competitions, which have the reputation and the high quality.
                  - There are many kinds of poor quality products with low prices, that requires
                    carrying out advertising campaign to publicize the quality of project products.




                                                      45
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




             Revenues of the project:

          Statement                                       Quantity    Price/SYP                        Total/SYP
          Quaternary examination device.                  8,000       2,000                            16,000,000
          Special tools set of bandaging                  5,000       1,000                            5,000,000
          Height measuring tool for adults                1,000       1,000                            1,000,000
          Height measuring tool for kids                  2,000       1,000                            2,000,000
          Midwife case                                    2,000       2,000                            4,000,000
          Optometry panel                                 2,000       500                              1,000,000
          A hammer for knee neurological examination      2,000       500                              1,000,000
          Digital blood pressure gauge                    10,000      4,000                            40,000,000
          Mercuric blood pressure gauge                   5,000       3,000                            15,000,000
          Pneumatic blood pressure gauge                  3,000       5,000                            15,000,000
          Stethoscope for adults                          5,000       2,500                            12,500,000
          Stethoscope for kids                            3,000       3,000                            9,000,000
          Used syringes case                              10,000      500                              5,000,000
          Kids weight scale                               2,000       3,000                            6,000,000
          Adults weight scale                             10,000      2,000                            20,000,000
          Total                                           70,000                                       152,500,000

          Second. Technical study:
           Technical description of the project:
           a. Location: Industrial City/Aleppo.
           b. Land & building: (SYP 133,900,000)
              The factory will be established on a land of an area not less than 20,000 m²,
              commensurate with the project’s need, and a value amounts to about SYP
              40,000,000.
              The building will be designed according to an internal scheme commensurate with
              the requirements of the production process and quality control conditions of the
              production and storage process, at a value amounts to about SYP 93,900,000 .

          c. Machinery and equipment (SYP 165,000,000 Western European origin).
              The project consists of two production lines (Western European origin) to assemble
              products, and a laboratory:
            - Reception and assembly line: It is a conveying strap where required tools are
              distributed on for assembly.
            - Packing and packaging machines: they are machines for packing and packaging
              products according to international standards, then repacked in properly printed
              containers.
            - Laboratory division: It consists of testing and calibration equipment.
          d. Means of production and service transportation: about SYP 8,200,000 .
          e. Furniture and furnishings: about SYP 1,500,000.
                                                   46
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




          f. The expenses of incorporation and licensing: about SYP 7,800,000.
          g. Commodity requirements: (SYP 62,500,000).
            - Raw materials: Mother boards - plastic faces - chemicals - other materials, in
              addition to packing materials and spare parts. Value of (SYP 53,764,000).
            - Other commodity requirements (electricity + water + fuel): (SYP 8,736,000).

          h. Service requirements (maintenance + mail and telephone + advertising + ...):
             (SYP 6,866,000).

          i. Administrative structure, salaries and wages:
          - Production Department: It’s responsible for all phases of the production process in
             addition to the division of laboratory and quality.
          - Promotion and Sales Department: It’s responsible for developing advertising and
             promotional policies and supervision of the operations of distribution and
             organizing external contracts.
          - Department of Human Resources and Finance: It includes the Finance Office, the
             Personnel Affairs Office, drivers and workers.
             Employment requirements estimated at (28 workers, one work shift) distributed to
             /2/ administration officials, /10/ experts, technicians and specialist workers and
             /16/ ordinary and seasonal workers. The total costs of salaries and wages including
             social security estimated at SYP 7,320,000

          Third: Financial Study:
             Estimation of investment costs:
          -   Fixed capital: SYP 316,400,000.
          -   Working capital: SYP 24,932,750.

             Estimation annual operating costs:
          -   Commodity requirements: SYP 62,500,000.
          -   Service requirements: SYP 6,866,000.
          -   Wages and employment: SYP 7,320,000.
          -   Depreciation: SYP 24,695,000.
              The variable costs estimated at SYP70,920,800 and fixed costs to SYP 30,460,200.

            Economic and financial analysis of the project:
            - Total investment costs = SYP 341,322,750.
            - Value of annual revenues (the average lifetimes of the project is 10 years) = SYP
              191,812,861.
            - Total annual costs (the average lifetime of the project is 10 years) = SYP
              119,663,620.
              Notice: Revenues increased annually at a rate of 5% and costs at a rate of 5%
              during the production lifetime of the project.




                                                   47
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




            Economic parameters of the project:
             a. Total annual revenues = SYP 96,844,241
             b. Net profit = SYP 72,149,241
             c. Pay-back period of invested capital = 3.5 years.
             d. Rate of return of capital (investment) = 28%
             e. Net present value at a discount rate of 15% = SYP 101,788,101
             f. Break-even point in the project = 28%
             g. Internal rate of return IRR = 22.7%
             h. added value = SYP 90,000,000.
             The project is largely sensitive towards the fall of the revenues at a rate of 10%;
             where the internal rate of return falls to 16.8%.

            Most important required permits:
             - The approval of the Syrian Arab Commission of Specifications and Standards.
             - Industrial Permit.
             - Licensing under law No. /8/ Investment Commission.
             - Subscription and allotment.
             - Building license.
             - Administrative permit and ecological consent.
             The industrial cities include the one-stop shop service, which issues all these
             permits.




                                                   48
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                              A Summary of a Feasibility Study
                        For a Factory of Assembling Busses & Trucks
                     Aleppo Governorate/ Industrial City, Sheikh Najjar/

           About the project:
            The project consists of an integrated production line
            for assembling two thousand buses and Pullmans,
            nine thousand 3.5-ton trucks, and fifteen thousand
            pickups loading less than 3.5 tons. Nearly 20% of the
            production will be exported.
            The project is located in Aleppo governorate which
            contains many complementary, technical and heavy
            industrial projects. It has a lot of experiences in this
            respect.
            The project is considered necessary, because of the
            increase of the population density and the large need
            to the means of exportation for covering the continuous need of transportation.
            However, the increase of the business transactions leads to the increase of the
            demand for trucks.

          First: Marketing Study:
             Product & quality:
              The project will offer the following products:
          -   2,000 buses and Pullmans.
          -   9,000 trucks loading more than 3.5 tons.
          -   15,0000 pickups loading less than 3.5 tons

             Study of the demand and supply and the gap between them:
              There are nearly 20,866,000 million inhabitants in Syria. The annual rise rate is
              2.4%. Of course, they need means of transportation. In addition, the depreciation
              rate of the means of transportation is high. This depreciation forms a permanent
              demand gap, usually compensated by importation. The revenues of Syria from
              buses and trucks are estimated at SYP 12.2 billion.
              Cars and trucks which were imported in 2009 nearly counted 70,928 vehicles of all
              sorts.

             Competition & competitors:
              There is no competitor in Syria. And an agreement between Syria and Iran was
              signed for building a busses factory and a production line of tractors since 2008 but
              it has not been built yet.


                                                     49
                                                                                                                    
Investment Opportunities Guide
                                                                                                                   Beat Al khebrah
                                                                                                                                 Syria 2011
                                                                                                        Consulting & Studies of Economic
                                                                                  




             Strategies of sale and distribution:
          -   70% of the production will be locally marketed.
          -   30% will be exported to the regional and international markets for realizing an
              income of foreign currency.

           SWOT
          a. Opportunities and points of strength:
          - The project includes production lines for many special parts related to the product.
             This will make it unnecessary to import them.
          - The ability of providing the imported spare parts in a way that guarantees the
             continuous mobility of the working capital.
          - The increasing demand for the product pursuant to the development of the
             inhabitants and transportation.
          - The lack of the internal competition.
          - The possibility of the production under a good well-known brand.

          b. Threats and points of weakness:
          - The outside competitors who may compete even in price.
          - The large reserve of spare parts and assembling parts of the product.
          - The probability of changes and disequilibrium in the prices of raw materials in
             future.

             Revenues of the project:
          Marketing                 Product                       Qty        Price                             Total/SYP
          Locally              Buses & Pullmans                  1,000    SYP 700,000                        SYP 700,000,000
          marketed      Truck loading more than 3.5 tons         7,000    SYP 500,000                       SYP 3,500,000,000
                        Pickup loading less than 3.5 tons        12,000   SYP 300,000                       SYP 3,600,000,000
          Exported    Buses & Pullmans                           1,000      $16,000                           SYP 736,000,000
                      Truck loading more than 3.5 tons           2,000      $11,000                          SYP 1,012,000,000
                      Pickup loading less than 3.5 tons          3,000       $7,000                           SYP 966,000,000
          The total                                                                                         SYP 10,514,000,000


          Second: Technical Study:
           Technical description of the project:
          a. Location: Aleppo, Sheikh Najjar, where the people of Aleppo are featured with
             their long experience in manufacturing spare parts for all kinds of cars.
          b. Land & Building: (SYP 950,500,000):
             The factory will be built on a piece of land of no less than 250,000 m2 fit to the
             need of the project at a value of SYP 500,000,000.



                                                            50
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




              The building will be designed according to an internal design fit to the requirements
              and conditions of quality control of production and storing. Its cost is nearly SYP
              450,500,000.

          c. Machinery and equipment: (SYP 3,356,000,000 of European origin):
          - The project consists of bridge lifts, forklifts, and other cranes with heavy engines.
          - Section of manufacturing parts of the engine, brakes, linking parts, joint parts, road
             steering tuning, gear box and rear active.
          - Sections of assembling.
          - Lines of forming iron-plates with moulds and accessories.
          - Line of automatic painting and its accessories.
          - Line of foam and its accessories for manufacturing the , tableau, steering,
             furnishing.
          - Line of manufacturing plastic parts.
          - Line of manufacturing electronic parts and electric cables.
          - Line of final assembling.
          - Line of testing and checking.
          - Supplementary service lines.

          d. Means of transportation (SYP 35,356,000,000) Buses for transporting workers
             and an articulated lorry for transporting assembling parts.
          e. Furniture and furnishing : (SYP 10,000,000).
          f. Expenses of incorporation and licenses (SYP 31,500,000).
          g. Commodity requirements: (SYP 8,000,000,000).
          - Raw materials: parts used in assembling, iron, plastic, rubber, clothes, cables,
             electronic parts, in addition to other parts required in the product (SYP
             7,650,000,000).
          - Other commodity requirements (electricity, water, fuel): SYP 350,000,000.
          h. Service requirements: (maintenance, mail, telephone, advertisement,) SYP
             70,000,000
          i. Administrative structure, salaries and wages:
             The organizational structure of the project consists of:
               - Production department: It is responsible for all stages of the production
                   process, in addition to the laboratory and controlling quality.
               - Promotion and sales department: It is responsible for drawing up the
                   advertisement and promotional polices as well as supervising the processes of
                   distribution and sales.
               - Human resources and finance department: It comprises the financial
                   directorate, personal affairs directorate, drivers and workers.



                                                     51
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




               The employment needed for the project is estimated at 372 workers with one shift,
               distributed to 14 administrative officials, 63 experts, and technicians, specialized
               workers, in addition to 295 provisional and ordinary workers. The total cost of
               salaries and wages, including the social insurances, is estimated at SYP 85,000,000.

          Third: Financial Study:
              Investment costs are estimated as follows:
          -    Fixed capital: SYP 4,383,000,000
          -    Working capital: SYP 1,457,000,000.

              Annual operating costs are estimated as follows:
          -    Commodity requirements: SYP 8,000,000,000.
          -    Service requirements: SYP 70,000,000.
          -    Wages and employment: SYP 85,000,000.
          -    Depreciations: SYP: 373,425,000.
               Variable costs are estimated at SYP 8,090,000,000, and fixed costs are estimated at
               SYP 438,425,000.
              Economic and financial analysis of the project:
          -    Total investment costs = SYP 5,840,000,000.
          -    Value of annual revenues = (the average lifetime of the project is 10 years + 2 years
               for construction) = SYP 10,044,269,000.
          -    Total annual costs (the average lifetime of the project is 10 years + 2 years for
               construction) = SYP 8,459,471,000.
               Notice: Revenues and costs are raised 3% during the production lifetime of the
               project.

              Economic parameters of the project:
                 a. Annual gross profits                                  = SYP 1,958,222,000
                 b. Net profits                                          = SYP 1,584,797,000
                 c. Pay-back period                             = 4.6 years (2 years for construction)
                 d. Rate of return of capital (investment)                = 34%
                 e. Net present value at a discount rate of 15%           = SYP 5,034,778,999.
                 f. Break-even point                                      = 22%
                 g. Internal rate of return                              = 39.3%
                 h. Added value                                          = SYP 2,514,000,000.
               The project is largely sensitive towards the fall of its revenues at a rate of 10%
               while the internal rate of return decreases to 18.8%.




                                                      52
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




             Most important required permits:
          -   Industrial permit.
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Subscription and allotment.
          -   Building license.
          -   Administrative permit and ecological consent.
              The industrial cities include the service of the one stop shop, which provides all
              these permits.




                                                   53
                                                                                                         
Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                              A Summary of a Feasibility Study
                    A factory of Producing Compressors & Hydraulic Jacks
                              Homs Governorate / Industrial City/

          About the project:
           The project is listed under the engineering
           industries. It aims at manufacturing
           compressors and jacks and assembling them in
           Homs governorate. Despite the importance of
           these products as mediatory tools and
           instruments in other industries like cars
           maintenance workshops, the factories that
           manufacture such tools are too little although
           they can be locally marketed in stores, in
           handcrafts and in large factories, and although
           the raw materials are available.
           This summary includes: marketing study,
           technical study and financial study.

          First: Marketing Study:
          Product & quality:
         a- Compressors: They are used in generating air at a
            certain pressure. They are featured with a
            continuous thermal balance (moving compressor,
            displacement compressor).
         b- Jacks: They are hydraulic used for lifting cars within service stations (a jack with
            one and two cylinder). They are relatively complementary to the industry of
            compressors, especially in the newly established cars maintenance stations.

          Study of the demand:
         a. Compressors: They are demanded to meet the need of cars factories, painting
            workshops, cars repairing workshops, carpenters, Ironsmith, stores of repairing tiers,
            teeth laboratories. …etc. The annual gross demand is estimated at 694,550 pieces:
            about 549,360 pieces are for satisfying the needs of wholesalers, and 145,200 pieces
            are for satisfying the need of retailers and semi-retailers.
         b. Jacks: They are used in most workshops of washing and repairing cars, factories of
            small cars, building contractors, state institutions …etc. The total demand is
            estimated at 37,320 jacks: about 32,640 jacks are for satisfying the need of
            wholesalers and 4,684 jacks for satisfying the need of retailers and semi-retailers.


                                                    54
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          Study of supply:
         a. Compressors: Field studies show that 54.4% of the supply of compressors is
            imported from Italian companies, 18% from Chinese companies and the rest is
            covered from national brands.
         b. Jacks: Italian brands nearly controlled 61% of the supply in the local market. Then
            came the Japanese brands at a rate of 9%. Jacks of national origin were absent.

            Competition & competitors:
             There are many brands of compressors and jacks spreading in the Syrian market
             (foreign & local). Since the users of these tools suffer from the high prices of the
             foreign brands of compressors and jacks, the Italian and Japanese in particular, in
             addition to the suffering from the technically low level of locally made ones, the
             project will concentrate on the high quality products which equal the imported
             counterparts with suitable prices to their users.
             The most important Italian compressors are: Balma, ABAC, MANKO. The national
             ones are: Shamel and Jesian.
             The most important Italian jacks are: ( BETA,DILTA, ECE).

            Strategies of sale and distribution:
             The local market share of the studied project will form 12% for compressors and 1%
             for jacks. This why the focus will be on the local market for selling all the products
             of jacks. Concentration will be on the governorates where the consumptive groups
             are (industrial cities, industrial zones, and industrial complexes. On the other hand,
             30% of the production of compressors will allotted to be exported to the neighboring
             countries and some African countries.

          SWOT:
         a. Opportunities and points of strength:
            - The project can strongly enter the local market, especially if it depends on a
               suitable pricing policy, due to the large demand for the products of the project.
            - The littleness of spare parts for the existing products in the market, especially
               the Italian jacks.
            - The possibility of providing free maintenance service for the machines by the
               project, based on a one-year guarantee at least.

         b. Threats and points of weakness:
             - The existence of a local product for the compressors. However, the project will
               depend on producing high quality compressors, especially with regard to the
               main parts (engines, pumps, accessories).
             - The competition by the imported goods. The project will depend on a price level
               less than the Italian products but with the same level of quality.
                                                     55
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                - The passive view about the quality of the national product. In this case, suitable
                  promotion means must be adopted in order to convince the consumers.

              Revenues of the project:
               The total revenues of the project are estimated at SYP 735,450,000 distributed as
               follows:
               a. Compressors: The project will produce different sizes: (50 liter, 100 – 150 –
                  200 – 300 – 500 – 1000 – 2000 liters). The total quantity is 35,840 pieces at
                  estimated revenue of SYP 681,550,000.
               b. Jacks: The project will produce two sizes (4 tons and 8 tons) the total quantity
                  300 pieces at an estimated revenue of SYP 53,900,000.

        Second: Technical Study:
              Technical description of the project:
             a. Location: The project will be built in the section of
                the engineering industry in the industrial city in Homs,
                where there is a group of investment advantages, in
                addition to its location in the middle of Syria.

         b. Land & Building: (SYP 87,000,000).
            The project needs a piece of land of no less than 2000 m2 at a total value of SYP
            3,500,000. The floor area of the factory is estimated at 3000 m2 with offices and
            showrooms of a floor area of 1200 m2 at a total cost of SYP 83,500,000.

         c. Machinery and equipment: (SYP 95,000,000 of west- European origin)
            The project needs iron plates and tubes twisting machines, argon welders, industrial,
            welders, electric welders, two-head circular welders, linear welders, electricity
            generators, electric press (400 to 1000 tons, eccentric press(8 – 10 – 15 tons), fixed
            and movable hydraulic cranes, bridge lifts and other equipments.

         d. Means of transportation (SYP 6,000,000).
             24-seat microbus, 2 trucks loading 3-5 tons, and forklifts.
         e. Furniture and furnishing: (SYP 500,000).
         f. Expenses of incorporation: (SYP 11,500,000): contracting charges, franchise,
             electricity convertor, advertisement campaign, declaration charges
         g. Commodity requirements: (SYP 535,000,000).
            - Raw materials iron plates with different thickness, plastic pieces.: SYP
                515,000,000)
            - Other commodity requirements (electricity, water, fuel): SYP 20,000,000.
         h. Service requirements: ((maintenance, mail, telephone, advertisement,
             promotion,…) SYP 7,000,000.

                                                       56
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




         i. The administrative and organizational structure:
            The administrative and organizational structure of the project consists of:
            - Production department: It is responsible for all stages of the production process,
               including encasing, packaging, lubricating and oiling.
            - Marketing and sales department: It is responsible for purchasing, selling,
               distribution, and drawing up the advertisement and promotional polices.
            - Administrative and finance department: It is responsible for accounting and staff
               affairs.
            The employment needed for the project is estimated at 93 workers with one shift,
            distributed to 21 administrative officials, 72 experts, technicians, specialized
            workers. The total cost of salaries and wages, including social insurances, is
            estimated at SYP 20,000,000.

        Third: Financial Study:
             Investment costs are estimated as follows:
             - Fixed capital: SYP 200,000,000
             - Working capital: SYP 80,000,000

            Annual operating costs are estimated as follows:
           - Commodity requirements: SYP535, 000,000.
           - Service requirements: SYP 7,000,000.
           - Wages and employment: SYP 20,000,000.
           - Depreciations: SYP: 16,140,000.
          Variable costs are estimated at SYP 547,000,000, and fixed costs are estimated at SYP
          31,140,000.

            Economic and financial analysis of the project:
           - Total investment costs = SYP 280,000,000.
           - Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
               843,111,000.
           - Annual total costs (the average lifetime of the project is 10 years)= SYP
               719,151,000.
          Notice: Revenues are raised 3% and costs are raised 5% during the production lifetime
          of the project.

              Economic parameters of the project:
                a. Annual gross profits                          = SYP 140,100,000.
                b. Net profits                                   = SYP 123,960,000.
                c. Pay-back period                               = 2 two years
                d. Rate of return of capital (investment)         = 50%
                e. Net present value at a discount rate of 15%   = SYP 408,622,000
                f. Break-even point                              = 20% ( SYP 168,655,000 ).
                                                        57
                                                                                                         
Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




               g. Internal rate of return                         =57.6 %
               h. Added value                                     = SYP 200,450,000
             The project is largely sensitive towards the fall of its revenues, where the internal
             rate of return decreases to 22.6% if costs fall at a value of 10%.

            Most important required permits:
           - Industrial permit.
           - Licensing under law No. /8/ Syrian Investment Agency.
           - Subscription and allotment.
           - Building license
           - Administrative permit and ecological consent.
          The industrial cities include the service of the one stop shop, which provides all these
          permits.




                                                    58
                                                                                                         
Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                             A Summary of a Feasibility Study
                      Producing Cement Sleepers (girders) for Railways
                         Homs Governorate / Hsia Industrial City/

           About the project:
            This project is listed under the engineering
            industries. It aims at producing highly reinforced
            cement sleepers specialized for railways in the
            industrial city in Homs governorate, after
            supplying the special cement from the main
            producers.
            There is a large need for the project, especially
            under the international link between Syria and the
            neighboring countries through railways, in addition to the need of the present
            railway network to the periodical maintenance.

              This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
             Product & quality:
              Concrete sleepers are produced in the Syrian market as part of the pre-made cement
              industries which depend upon the ready mixed concrete with a difference in the
              mixture and mould between a type and another. The sleepers of railways are
              produced according to the international bases (B70). The technical specifications of
              the ready concrete mixture are scientifically determined according to a group of
              Syrian standards and specifications as follows:
               - The allowed loads of axes are 25 tons.
               - The maximum speed is 250 km/h.
               - The weight without the means of fixing is 280 kg.
               - The length is2600 mm, and the width is 300 mm.
               - The height of the sleeper is 234.
               - The height of the middle of rod fixers is 214 mm
               - The height of the middle of sleeper is 175 mm.

             Study of demand:
              The demand for the cement sleepers (girders) arises from the General
              Establishment of Railways through carrying out a new railway network or
              maintaining the current network. The internal railway network is 2,833 km long.
              This length will increase with the new proposed projects in Syria for linking the
              governorates with each other and connecting Syria with the neighboring countries.

                                                    59
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




              Study of supply:
               There is only one single factory for producing cement sleepers for railways in
               Syria. It is a public sector project with a production capacity of 200,000 sleepers a
               year. It is situated in Homs.

              Gap between demand and supply:
               The gap between the supply and the demand is determined as a result of the
               increase of the lengths of railway network and the variance of the demanded
               quantities for maintenance. Thus, the demand will be larger at present.

              Competition & competitors:
               There is only one competitor in the Syrian market. It is attached to the public
               sector. its production capacity is 200,000 cement sleepers per year, but it suffers
               from slowness due to the routine.
               There are three establishments working in cement products, but most of them are
               limited to simple products such as pavement tiles and other works.

              Strategies of sale and distribution:
          -    Local markets: 60% of the product as a result of the increase of the lengths of the
               railway network.
          -    Regional markets: 40% of the product will be exported to Iraq, Turkey and Egypt
               for being the nearest for execution.

              SWOT:
          a.   Opportunities and points of strength:
          -    The availability of raw materials at reasonable prices subsidized by the government.
          -    The availability of sufficient qualified staff.
          -    The closeness of the projects, with regard to the vital connection between the
               governorates and Syria and the nearby countries (the prospective toll road and the
               links on it).
          -    The competition is limited to one competitor.

          b.   Threats and points of weakness – suggested solutions:
          -    The probable rise of the prices of raw materials.
          -    The gap of the cement quantities which is covered by importation.
          -    The infrequent periods of maintenance as a result of the long production lifetime of
               sleepers.




                                                      60
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




             Revenues of project:
              The annual revenues of the project out of producing 100,000 sleepers are estimated
              at SYP 750,000,000, considering the average price of a sleeper SYP 7,500 (as
              accredited in the contracts of the Public Establishment of Railways in Syria. :

          Second: Technical Study:
           Technical description of project:
          a. Location: Hasia Industrial City in Homs. It is close to the areas of extracting
             cement in the Syrian steppe.
          b. Land: SYP 25,500,000.
             The project will be set up on a piece of land of no less than 15 dunams (15,000 m2).

          c. Building and in situ works: (SYP 75,000,000)
             Administrative offices and hangars for storing, according an internal chart fit to the
             requirements of the production process and the relevant conditions of quality
             control of storing and transporting.

          d. Machinery and equipment: (SYP 80,500,000 of a European origin).
             The project consists of different parts for producing and casting reinforced
             concrete. All spare parts are European. They are as follows:
          - The line of the concrete mixer for producing and casting the reinforced cement
             (tanks of gravel, main mixer, silos of cement, control room, …etc).
          - Special moulds
          - Aqueous cooling unit.
          - Other complementary devices (electricity generator 30 KVA, 250 KVA)

          e. Means of transportation (SYP 36,000,000), including the pump of concrete and a
             group of service cars and transporting wheel loaders… etc.
          f. Furniture and furnishing: (SYP 1,000,000).
          g. Expenses of incorporation and licenses (SYP 2,000,000).
          h. Commodity requirements: (SYP 500,000,000).
          - Raw materials: (cement at a price of SYP 6,400 per ton/ iron rods at a price of
             37,000 per ton): SYP 495,000,000.
          - Other commodity requirements (electricity, water, fuel): SYP 5,000,000.
          i. Service requirements: (maintenance, mail, telephone, advertisement,
             promotion,…): SYP 2,000,000.

          j. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:
          - Production department: It is responsible for all stages of the production processes,
             as well as monitoring them.
                                                   61
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




          - Purchases and sales department: It is responsible for drawing up the advertisement
               and promotional polices as well as supervising the processes of supplying raw
               materials and studying the markets and stock.
           - Human resources and finance department: It comprises the financial directorate and
               the directorate of personal affairs, drivers and workers.
          The employment needed for the project is estimated at 22workers with one shift,
          distributed to 5 administrative officials, 17 technicians, production and maintenance
          workers, as well as guards. The total cost of salaries and wages, including social
          insurances, is estimated at SYP 7,500,000.

          Third: Financial Study:
             Estimation of investment costs:
          -   Fixed capital: SYP 220,000,000.
          -   Working capital: SYP 180,000,000.

             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP 500,000,000.
          -   Service requirements: SYP 2,000,000.
          -   Wages and employment: SYP 7,500,000.
          -   Depreciations: SYP: 19,600,000.
              Variable costs are estimated at SYP 504,600,000 and fixed costs are estimated at
              SYP 24,500,000.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 400,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              859,791,000.
          -   Total annual costs (the average lifetime of the project is 10 years) =SYP
              630,328,000.
              Notice: Revenues are raised 5% and costs are raised 4% during the production
              lifetime of the project.

             Economic parameters of project:
               a. Annual gross profits                              = SYP 249,063,000.
               b. Net profits                                       = SYP 229,643,000.
               c. Pay-back period                                  = 1.6years
               d. Rate of return of capital (investment)       = 62%
               e. Net present value at a discount rate of 15% = SYP 730,754,239
               f. Break-even point                                =10 % = SYP 85,979,100.
               g. Internal rate of return                        = 60.4%
               h. Added value                                     = SYP 250,000,000.
                                                   62
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




              The project is largely sensitive towards the fall of its revenues 20%, where the
              internal rate of return decreases to 15.4% .

             Most important required permits:
          -   Industrial permit / Ministry of Industry.
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Subscription and allocation.
          -   Building license.
          -   Agricultural permit
          -   Administrative permit and ecological consent
              The industrial cities include the service of the one stop shop, which provides all
              these permits.




                                                   63
                                                                                                               
Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




                                     A summary of a feasibility study
                            of a Factory for the Production of Resistant Glass
                                Homs Governorate / Hsia Industrial City/

               About the project:
                The project consists of an integrated production line to
                produce distinctive kinds of glass resistant to: heat,
                breakage, shocks, and corrosion by acids. The project
                is integrated with the need of the project’s area of the
                industrial and the residential city of Hisia as well as to
                meet the public demand in Syria. Also about 20% of
                production will be exported to outside the country.
                This project is necessary because of the increase in
                the demand for this product which is associated with
                the development of residential, commercial and
                service sectors.

          First: Marketing study:
                 Product & quality:
                  The project will provide a high quality product from the glass
                  plates resistant to heat, breakage , shocks and corrosion by acids.
                  This product which the demand increased on in the recent period
                  for shop windows, aspects of commercial, residential, service
                  companies, banks and other constructions, as well as in the
                  environmental houses since it is considered an important building
                  material being resistant to heat and corrosion.
                  The project aims at producing shielded glass in the form of a one-
                  piece heat-treated in a special way. It is exactly like the ordinary
                  glass in appearance, feel and weight but it has a higher resistance
                  to fires, collisions and chemical effects.

                 Study of demand:
                  Building licenses had been issued for about 130,579 housing units and 712
                  industrial establishments in Syria in 2009. Percentage of population growth
                  amounted to 2.4% and total population reached to about 21 million people. All of
                  whom need housing, employment, and thus the demand for raw materials for the
                  cladding increases to about 3% annually. The need of licensed buildings for
                  cladding materials has been estimated at SYP 27 billion.

                 Study of supply:
                  Annually, Syria imports 100% of the need for glass resistant to heat, breakage,
                  shocks and corrosion, as factories in Syria producing hardened glass in the
                  horizontal way, and there are no plants for the manufacture of resistant glass of the
                  type studied.

          
              Statistical Abstract 2010
                                                         64
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




             Gap between demand and supply:
              The gap is too large that amounts to 100% of the demand for this type of glass
              being fully imported since it is not produced locally. Thus the project has a great
              opportunity to control the market to meet demand in the domestic market, as well
              as the possibility of exporting to neighboring countries.

             Competition and competitors:
              Internal competition is limited since there isn’t any factory in Syria producing this
              type of glass, however imported glass is a strong competitor.

             Strategies of sale & distribution:
              - 80% of local production will be internally marketed.
              - 20% of production will be exported to regional and international markets to
                  achieve an income of foreign exchange for the country.

              (SWOT):
              a. Opportunities and points of strengths:
                 - Availability of raw material in Al Qariaten Town - Homs, which is
                   quartziferous sand rich in silicate.
                 - The growing demand for the product that is associated with the increasing
                   population and expansion of residential and non-residential buildings.
                 - Existence of a major movement of construction in brotherly Iraq; clearing the
                   way for new markets.
                 - Lack of internal competition as an integrated product, where there are
                   factories based on the import of glass and then hardening it. This competes
                   with the final product but it can also be a customer of a flat glass commodity.

              b. Threats and points of weakness:
                - Competition with foreign and Arab products, especially Saudi Arabia.
                - Development plans in force in the industrial public sector for factories of
                  glass in Damascus and Aleppo to enable the production of flat and hardened
                  glass.

             Revenues of the project:
           Marketing           The product            Quantity   Unit      Price                         The total SYP
                       Heat, breakage and corrosion
           Locally                                    36,000     m²     SYP 15,000                     SYP 540,000,000
                       resistant glass plates
                       Heat, breakage and corrosion
           Exports                                    9,000      m²     $ 350.0                        SYP 144,900,000
                       resistant glass plates

           Total                                                                                       SYP 684,900,000




                                                        65
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




          Second: Technical study:
              Technical description of the project:
              a. Location: Hsia / Homs, due to the presence of appropriate raw material for the
                 industry (quartziferous sand) in Al Qariaten Town of Homs Governorate.

              b. Land and building: (SYP 247,000,000 )
                 The factory will be established on a land area of not less than 30,000 m ²,
                 commensurate with the project’s requirements at a value about SYP 51,000,000
                  The building designed according to an internal plan commensurate with the
                 requirements of the production process and quality control requirements of the
                 production and storage process, at a value of about SYP 196,900,000.

              c. Machinery & equipment: (SYP 910,000,000 of Western European origin)
                 Production line consists of the following divisions:
                 - Division of the transfer of the raw material from presence sites (quartz
                     sand).
                 - Division of receiving raw material (sand).
                 - Division of washing and purification raw materials of dust and dirt.
                 - Division of drying and treatment of raw materials.
                 - Division of melting (furnaces of high temperatures).
                 - Division of feeding furnaces with fuel.
                 - Division of extracting glass paste.
                 - Division of paste processing and the introduction of other raw materials.
                 - Division of molding and forming.
                 - Cooling division.
                 - Division of shearing.
                 - Division of hardening and treating glass plates.
                 - Division of polishing.
                 - Division of packaging and storage.

              d. Means of production and service transportation: (SYP 20,400,000). They are
                 heavy trucks to transport sand and other specialized trucks to transport the glass.
              e. Furniture and furnishing: about (SYP 600,000).
              f. Expenses of incorporation and licensing: about (SYP 10,500,000).
              g. Commodity requirements: (SYP 337,191,000).
                  - Raw materials: They are the quartziferous sand that available in abundance
                     in the project area, in addition to other materials such as the breakage of
                     pots and empty glass bottles that cannot be re-packed, as well as some
                     assisting materials estimated at (SYP 324,104,000).
                  - Other commodity requirements (electricity + water + fuel): (SYP
                     13,087,000).
                     These projects are of projects that use water in large quantities and the

                                                     66
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                         estimated need of treated water is 20,160 m3 that is available in the
                         industrial city.
                 h. Service requirements :(maintenance, mail, telephone, advertising, ..): (SYP
                     21,400,000).
                 i. Administrative structure, salaries and wages:
                      - Production Department: It’s responsible for all phases of production process
                         in addition to the division of the laboratory of quality.
                      - Promotion and Sales Department: It’s responsible for developing
                         advertising and promotional policies and oversee the distribution and sale in
                         the various lounges.
                      - Human Resources and Finance Department: It comprises the Finance
                         Office, the Personal Affairs Office, drivers and workers.
                  The estimated need of workers is (158 workers, one shift) distributed to 4
                  administrative officials, 29 experts, technicians and specialized workers and 25
                  ordinary and seasonal workers. The total estimated cost of salaries and wages
                  including social securities is (SYP 47,160,000)

          Third: Financial Study:
                 Estimation of investment costs:
                 - Fixed capital: SYP 1,188,500,000.
                 - Working capital: SYP 111,500,000.

             Estimation of annual operating costs:
             - Commodity requirements: SYP 337,191,000
             - Service requirements : SYP 21,400,000.
             - Wages and employment: SYP 47,160,000.
             - Depreciation: SYP 107,040,000.
          Variable costs are estimated at SYP 386,887,000, and fixed costs are estimated at SYP
          125,904,000.

            Economic and financial analysis of the project:
              - Total investment costs = SYP 1,300,000,000.
              - Value of annual revenues (the average lifetime of the project is 10 years) = SYP
                  861,460,000.
              - Total annual costs (the average lifetime of the project is 10 years) = SYP
                  612,526,000.
          Note: Revenues and costs are increased 5% during the production lifetime of the
          project.

                Economic parameters of the project:
                  a. Total annual profits                         =SYP 355,974,000.
                  b. Net profits                                  = SYP 248,934,000
                  c. Pay-back period of invested capital          = 3.7 years.
                                                           67
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




               d. Rate of return of capital (investment)         = 27%
               e. Net present value at a discount rate of 15%    = SYP 335,254,647.
               f. Break-even point of the project                = 34% (SYP 292 896 400)
               g. Internal rate of return (IRR)                  = 21.7%
               h. Added value                                    = SYP 347,709,000.
          The project is largely sensitive towards the fall of the revenues at a rate of 10%; where
          the internal rate of return falls to 14.6%.

            Most important required permits:
              - Approval of the General Institution of Geology.
              - Industrial permit.
              -Licensing under law No. /8/ Investment Commission.
              - Subscription and allotment.
              - Building license.
              - Administrative permit and ecological consent.

              The industrial cities include the service of the one stop shop, which issues all these
              permits.




                                                     68
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Investment Opportunities Guide
                                                                                                                       Beat Al khebrah
                                                                                                                                     Syria 2011
                                                                                                              Consulting & Studies of Economic
                                                                                        




                                    A Summary of a Feasibility Study
                                         Producing Cars Glass
                               In Homs Governorate/ Hasia Industrial City/

          About the project:
           The project is classified under the chemical
           and industrial projects. It aims at producing
           cars glass with the purpose of feeding the
           factories of cars which have recently been built
           in Syria and covering the market needs for
           replacing and renewing the broken, the
           scratched and the darkened boards.
           The project will be built in Hasia Industrial
           City, where activities are spreading and investment advantages are available.

                This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
               Product & quality:
                The project will produce the following kinds of cars glass:
              - Triplex glass: It consists of two layers and a jelly nylon layer in between (05 mm
                thick). It is used for windscreens. It is 4.5 – 6 mm thick.
              - Secured glass: It is tempered and compressible glass. It is used for rear and side glass
                of cars. Sometimes it is used for shop windows.
              - Surgrete glass: It consists of one layer. It is neither tempered nor jelled. It is 3 – 6
                mm thick. It is used for the sides and corners. It is usually of a bad quality.

               Study of demand:
                Stores that sell car glass are estimated at 510 ones. On average, a store house sells
                50 glass boards per month. Accordingly, the annual demand for the car glass boards
                is estimated at 306,000. Added to this quantity is the demand of ( Sham and Saba )
                cars at a quantity of 78,000.. Accordingly, total demand is estimated at 576,000 m2
                (384,000 boards X 1.5 m2, the board area on average).

                Study of supply:
                The annual production capacity of the car glass factory is nearly 275,000 m2. A little
                quantity of the production is exported. On the other hand, Syria imports around
                184,000 m2 per year. Accordingly, the total displayed quantity of car glass in the

          
              A field survey to the car glass market.
          
              The daily production capacity of Saba Factory is 40 cars, and Sham Factory 25 cars.
                                                               69
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




               local market is estimated at 459,000 m2 (275,000 m2 local production + 184,000 m2
               imported)

              Gap between demand and supply:
               The above mentioned data indicates a clear gap in favor of the demand for the car
               glass estimated at 117,000 m2. This quantity can be increased after doing without the
               imports. This confirms the opportunity of the studied project to get a market share
               during the first stage of operation.

             Competition & competitors:
              Local competition: It is limited to three factories in Aleppo:
             - Royal Factory: It is the largest one. It contains modern European production lines.
               Its products are equal to the Saudi and Egyptian production. This factory exports
               part of its production to Iraq, Libya and some
               European countries.
             - Amas Factory: It ranks two after Royal factory in
               covering the need of the local market. Its products are
               of less quality than the products of Royal Factory.
             - Sameh Istamboli Factory: It’s the smallest factory. Its
               production is limited.

               External competition: The Kingdom of Saudi Arabia occupies the first rank of
               suppliers of car glass to the Syrian market (50% of total imports). Egypt is the
               second, and then comes Jordan, Turkey and China, in addition to a number of
               European countries.

              Strategies of sale and distribution:
               - Local markets: 80% of the production will be directed to the local markets with a
                  special focus on Damascus and Aleppo.
               - Regional markets: 20% of the production will be directed to the markets of Iraq
                  and Jordan.

          SWOT:
         a. Opportunities and points of strength:
            - The large increase of the imported cars to Syria and locally produced cars for
              meeting the people's need of different classes, which reflects the extent of the
              need of the local products and attached services.
            - The existing factories of car glass do not cover the need of the local market.
            - There is a possibility of exportation to the external markets which previously
              imported the Syrian car glass that proved a good quality.


                                                      70
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




         b. Threats and points of weakness:
            - The external competition of the Saudi and Egyptian brands to the Syrian
              production (in quality and price).
            - The internal competition of the existing factories.

            Revenues of project:
             The production capacity amounts to SYP 63,800 boards. And the revenues are
             estimated at SYP 159,500,000. The price of a glass board is SYP 2,500 on average.

         Second: Technical Study:
          Technical description of project:
         a. Location: Hasia Industrial City, with a view of
            benefiting from the advantages given to the investor by
            the industrial cities.
         b. Land and Building: (SYP 33,000,000)
            The factory will be built on a piece of land estimated at
            3.500 m2 at a value of SYP 6,000,000. The building
            will be constructed according to a chart fit to the requirements of the production
            process at a value of SYP 27,000,000.

         c. Machinery and equipment: (SYP 51,500,000 of a European origin).
            The production line consists of:
              - A machine for cutting glass with its accessories.
              - A machine for collecting layers.
              - Autoglave.
              - A group of compresses.
              - A machine for grinding the edges.
              - Metal moulds.
              - A machine for spraying powedr of sticking.
              - A machine for spraying sillicon.
              - A drying oven.
              - An electric generator.
              - A gantry crane.
         d. Means of transportation (SYP 7,000,000 ): A truck loading 5 tons for transporting
            glass. Pickups, ….
         e. Furniture and furnishing: (SYP 1,000,000): Office equipment for the
            administrative offices, tables, chairs, computers, uninterruptible power units (UPS),
            electric equipment….
         f. Expenses of incorporation and licenses (SYP 2,500,000):



                                                    71
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




              -      Expenses of engineering studies, expenses of a feasibility study, administrative
                     expenses, charges and licenses., wages of experts and supervisors for the
                     installation of machines.
         g.       Commodity requirements: (SYP 111,300,000).
          -        Raw materials: glass boards, silicon, polishing materials, powder to prevent
                   sticking: SYP 99,300,000.
          -        Other commodity requirements (electricity, water, fuel): SYP 12,000,000.
         h.       Service requirements: (maintenance, telephone, advertisement): SYP 5,000,000.

         i. Administrative structure and organizational structure:
            The administrative and organizational structure of the project consists of:
             - Production department: It is interested in all production processes. It is
                 responsible for quality control.
             - Financial and administrative department: It is interested in securing liquidity,
                 accounts, workers' affairs.
             - Marketing and sales department: It is interested in sales, distribution, exportation
                 of final product. It also supervises propaganda, advertisement and promotion.
            The employment needed for the project is estimated at 45 workers with one shift,
            distributed to 5 administrative officials, 6 technicians and experts, 34 production
            workers, drivers and guards.. The total cost of salaries and wages, including social
            insurances, is estimated at SYP 12,000,000.

        Third: Financial Study:
              Estimation of investment costs:
              - Fixed capital: SYP 95,000,000.
              - Working capital: SYP 30,000,000.

              Estimation of annual operating costs:
              - Commodity requirements (supplies): SYP 111,300,000.
              - Service requirements: SYP 5,000,000.
              - Wages and employment: SYP 12,000,000.
              - Depreciations: SYP: 8,600,000.
               Variable costs are estimated at SYP 120,100,000 and fixed costs are estimated at
               SYP 16,800,000.

              Economic and financial analysis of project:
              - Total investment costs = SYP 125,000,000.
              - Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
                 182,489,000.
              - Total annual costs (the average lifetime of the project is 10 years) = 154,481,000.

                                                        72
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




             Notice: Revenues and costs are raised 3% during the production lifetime of the
             project.

            Economic parameters of project:
                a. Annual gross profits = SYP 36,968,000
                b. Net profits                                  = SYP 28,368,000
                c. Pay-back period                             = 3.4 years
                d. Rate of return of capital (investment)       = 30%
                e. Net present value at a discount rate of 15% = SYP 64,181,348
                f.Break-even point                            = 37% = SYP 67,654,130
                g. Internal rate of return                      = 24.7%
                h. Added value                                 = SYP 48,200,000.
             The project is largely sensitive towards the fall of its revenues 10%, where the
             internal rate of return decreases to 7.5% .

             Most important required permits:
             - Industrial permit / Ministry of Industry.
             - Licensing under law No. /8/ Syrian Investment Agency.
             - Subscription and allocation.
             - Building license.
             - Administrative permit & ecological consent
              The industrial cities include the service of the one stop shop which provides all these
              permits.




                                                      73
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                               A Summary of a feasibility study
                            For a project of printing press complex
                          In Homs Governorate/ Hasia Industrial City/
           About the project:

            The project is classified within the economical-
            cultural activities, it aims at establishing a press
            complex for printing all kinds of books, magazines
            and newspapers, where printing is considered one of
            braching sectors. It works on serving all economical
            and social sectors. The most important services
            provided by this sector are printing daily and
            periodical newspaper and books.
            Due to the prominent role that press plays in enlightenment of the public opinion
            culturally and politically, it is suggested to establish the project in the industrial City
            of Hisia /Homs Governorate.

            This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
             Product and Quality:
              Syria has been famous for its skills in printing processes and their principles since
              ancient times. Syrians are among the first who introduced the art of printing to the
              Arab world, , where the first Arab printing press was introduced to City of
              Aleppo in 1702, and then introduced to the City of Damascus. It characterized by
              a high level of accuracy and work in different types of publications. In 1855 the
              first Arabic newspaper appeared in the city of Aleppo, named Miaat Al –Ahwal
              (mirror of conditions).The most important qualities of Syrian publications were
              inks stability, smooth surface, and clarity of letters and colors.

             study of Demand:
              Demand for publications is created from the daily need of readable books that
              include newspapers and magazines dealing with various types of economic life,
              textbooks and cultural books, and novels dealing with the various aspects of
              cultural life. A survey of household expenditure in 2009 indicated that the
              average expenditure of the Syrian family of publications per month (excluding
              textbooks) amounted to 37.1 SYP, and thus the value of the demand for
              3,900,000 households × 37.1SYP × 12 months = SYP1,736,280,000 for the
              month.

             Study of Supply:
              This type of printing is limited to the United Group of Printing and Publishing,
              which owns the largest private collection of printing at an estimated production
              capacity of 10,560,000 copies annually, in addition to state-owned old printers
              that printing official newspapers and textbooks.
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




             Gap between demand and supply:
              There is a lack in the number of printing presses, compared with the demand for
              publications, which has led to the existence of a large gap between demand and
              supply, and the tendency of companies to print outside the country. This project
              would support local work and bringing back economic investments that shifted
              their information activities outside the country.

             competition and competitors:
              The existence of large printing machinery in the public sector is limited to
              machinery of Al-wehda, Tishreen, and Al- Baath printing presses, but In the
              private sector its existence is limited to the United Group for Printing, Publishing
              and Distribution, which has machines with medium technical specifications and
              ordinary techniques. as well as it does not cover the huge demand for printing
              services.

             Strategies of sale and distribution:
              Currently focus will be on local markets and attracting local economic activities in
              both private and public sectors.

             SWOT:
              a. Opportunities and points of Strengths:
               - The provision of modern printing products to meet the growing need for this
                  product.
               - Significant expansion in the investment and the economy.
               - Lack of competing projects (private sector), and customers proceeding to print
                  abroad.
              b. Threats, and points of weaknesses and proposed solutions:
                  - New entrants to work in the field of printing.
                  - Tendency of the community towards electronic books and magazines.
             Revenues of the project:
              The production capacity of the project is estimated at SYP 1,265,000 copies
              (equivalent to pages) a day, assuming that each machine works one shift, the
              estimated revenue for a single machine is as follows:
              Cost of     labels = number of        labels x cost of preparing the labels
                                  = 38 × 1,000 = SYP 38,000.
              Cost of printing = quantity of prints x fees of printing 1,000 press (or pages)
                                 = 1,265,000 × 250 / 1,000 = SYP 316,250
               .

               Annual revenue per one machine (assuming 330 work days) is SYP 116,900,000,
               and. SYP 233,800,000 for two machines.

          Second: Technical study:
             Technical description of the project:
             a. Location: The project will be established in the
                Industrial City of Hisia-Homs Governorate where

                                                    75
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                   the industrial environment available in this area secures many advantages for
                   work provided by the state, as well as the proximity from the raw materials
                   resources.
              b.   Land and building (SYP 38,000,000).
                   The factory will be established on a land of 1,700 m2 area values SYP
                   2,000,000.The building will be done according to an internal plan
                   commensurate with the requirements of the production process taking into
                   account the technical conditions of the process of printing at a cost of     SYP
                   36,000,000.
              c.   Machinery and equipment ( SYP 672,000,000 of
                   German origin ). They include a printing machine
                   with five heads and accessories: quantity /2/
                   machines.
              d.   Means       of     production       and     service
                   transportation: (SYP 7,000,000)
              e.   Furniture and furnishing: (SYP 500,000).
              f.   The expenses of incorporation and licensing:
                   (SYP 2,500,000).
              g.   Commodity requirements (SYP 30,000,000).
                   - Raw materials (a variety of inks, labels, cleaning materials, rubber):
                     (SYP 27,000,000).
                   - Other commodity requirements (electricity + water + conditioning):
                     (SYP 3,000,000).
              h.   Service requirements (spare parts, packing, maintenance, other
                   requirements,..): (SYP 14,000,000).
              i.   Administrative structure, salaries and wages: (SYP 5,000,000).
                   1 - Division of Design and Montage.
                   2 –Division of Production: it is responsible for all stages of printing processes,
                       it includes the production manager, engineer in charge and ordinary
                       workers.
                   3 – Division of Administrative and Financial Affairs: it is responsible for
                       following-up personnel, and workers affairs, and includes (Director General,
                       secretariat, accounting, and store keeper).
                   4 - Marketing division.
                    The project requirements of employment is estimated at 12 workers (two work
                    shifts or 24 workers), considering that machinery are fully automated which
                    requires only two or three workers. The mass of salaries and wages including
                    social securities is estimated at SYP 5,000,000.

          Third: Financial Study:
             Estimation of investment costs:
              - Fixed capital: SYP 720,000,0000.
              - Working capital: SYP 15,000,000.

                                                      76
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




             Estimation of annual operating costs:
             - Commodity requirements: SYP 30,000,000.
             - Service requirements: SYP 14,000,000.
             - Wages and employment: SYP 5,000,000.
             - Depreciation: SYP 71,000,000.
            Variable costs are estimated at SYP 43,200,000 and fixed costs to SYP 76,800,000.

             Economic and financial analysis of the project:
             - Total investment costs = SYP 65,000,000.
             - Value of annual revenues (the average lifetime of the project is 10 years) = SYP
               74,515,000.
             - Total annual costs (the average lifetime of the project is 10 years) = SYP
               47,462,000.

               Notice: Revenues increased at a rate of 3% and costs at a rate of 4% annually
                      during the production lifetime of the project.

             Economic parameters of the project:
              a. Total annual profits                        = SYP 735,000,000
              b. Net profits                                 = SYP 294,071,000
              c. Pay-back period of invested capital         = 3.1 years.
              d. Rate of return of capital (investment)      = 32%
              e. Net present value at a discount rate of 15% = SYP 325,620,365
              f. Break-even point of the project             = 32% (SYP 94,000,000)
              g. Internal rate of return (IRR)               = 26.2%
              h. Added value of the project                  = SYP 203,800,000.


               The project is largely sensitive towards the fall of its revenues, where the internal
               rate of return falls to 22.3% when revenues fall at a rate of 10%.

             Required permits:
              - Industrial permit.
              - Licensing under law No. /8/ Investment Commission.
              - Subscription and allotment.
              - Building permit.
              - Administrative permit and ecological consent.

               The industrial cities include the service of one stop shop, which issues all these
               permits.




                                                     77
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                              A Feasibility Study Summary of
                 A Factory of Producing Foldable Enameled Copper Wires
                       In Homs Governorate / Hasia industrial city /

            About the project:
             The project is listed under the engineering projects whose
             aim is to produce foldable enameled copper wires.
             Copper has been one of the most important metals for
             more than 7000 years. Nowadays, this orange reddish
             metal is used in many industries, starting from telephone
             sets to the electronic electrical systems of rockets control
             in the space.
             Copper is a good conductor of electricity. It is cheap,
             which makes it widely used in 60% of the electrical
             industries in the form of wires. Its most important
             properties are: anti-erosion, elastic and it can take the form of thin wires without
             being broken. A bar of 1 cm can be changed into a wire thinner than a hair. The
             area of our project is limited to this scope. The project is suggested to be built in the
             industrial city in Hasia in Homs governorate.
              The summary of the feasibility study includes: marketing study, technical study and
              financial study.

            First: Marketing Study:
              Product & quality:
                Wires are made of the good enameled quality and according to the following
                standards: (IEC317-33. IEC 317-13. CLASS: 180.200 – CLASS H).
                Manufacturing is done by cleaning and preparing copper bars in a revolving
                machine till they become 6 mm. Then they are drawn through drawing molds
                according to the required diameter used in conducting electricity.
               The study of the demand
                The demand for copper wires arises from their use in the different kinds of
                electrical devices, in addition to the use in folding engines and many other
                electric uses.
               The study of supply:
                The annual local production of the different kinds of wires
                is nearly 1020 tons.
               The gap between the demand and the supply:
                The Syrian exports were estimated at approximately 713
                tons, while the imports were 1236 tons in 2009. There is a
                variance in the annual quantities whose 70% of which is
                exported and the local demand which is estimated at 1543
                tons per year. This will generate good profits to the
                project.

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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




               Competition & competitors:
                There are two main producers in Syria:
                 - Al-Sowaidi Cables Company (Damascus Rural area)
                 - Defense Factories Establishment (public sector).
                They produce cables of big diameters which do not contradict with the products
                of the project, because the project will produce cables of small diameters.
               Strategies of sale and distribution:
                 - Local markets: (Homs and all Syrian
                     governorates) at a rate of 75% of the production..
                 - Regional markets: (nearby markets) at a rate `of
                     25% of the production.
                 - International markets: Not targeted.
               SWOT:
                a. Opportunities and points of strength: .
                - The incremental demand for copper wires.
                - Exportation to the neighboring countries.
                - Joining the Free Arab Trade Zone by Syria opens new prospects for
                   exportation.
                b. Threats and points of weakness:
                - The global high price of copper.
                - The competition of the imported brands in the local market.
               Revenues of the project:
                The annual revenues of the project for producing 400 tons of enameled copper
                wires are estimated at s.p. 132,000,000. The price of one kilogram is s.p 330 on
                average.

            Second: Technical Study:
               The technical description of the project:
                 a. Location: Hasia industrial city in Homs in the middle of the Syrian map, in
                    addition to the advantages and exemptions presented to this industrial city
                    and being near from the markets of distribution are advantages which can be
                    benefited from.
                b. Land & building: (s.p 23,000,000)
                    The factory will be built on an area of no less than 5 donums (a measure of
                    land, 1000sq. m.), according to an internal chart fit to the requirements of
                    production process and the conditions of quality control.
                    The value of the piece of land is estimated at s.p 8,500,000 while the building
                    is estimated at s.p. 14,500,000..
                c. Machines and equipment: (s.p.83,000,000 of Indian origin, Japanese,
                    Austrian and German origin).


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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                      The project consists of four main production lines as follows:
                       - Full automated production line with full control (flexible manufacturing
                            system)
                       - Line of cleaning copper bars from the stains and gangues
                       - Line of drawing wires with and automatic calibration system for
                            identifying the required thickness and length.
                       -     Line of enameling by a thermal system.
                       - A unit for packing and packaging according to the system of multi size
                            pulleys with its supplements.
                       - Other equipment.
                d.   Means of transportation (s.p. 7,500,000)
                e.   Furniture: (s,p 1,500,000).
                f.   Expenses of incorporation and permits (s.p 5,000,000).
                g.   Commodity requirements: (s.p 80,000,000).
                     - Raw materials (copper bars, enamel, paint solvent, acids, folding pulleys,
                         packing and packaging materials): s.p 62,500,000.
                     - Other commodity requirements (electricity, water, fuel): s.p 18,000,000.
                     - Service requirements: (maintenance, mail, telephone, advertisements,
                         promotion, (s.p 6,500,000).

                h. The organizational structure, salaries and wages:
                   The organizational and administrative structure consists of the following
                   departments;
                    - Production department: It is responsible for the
                       whole stages of the production process.
                    - Quality control and monitoring department : It is
                       interested in following up quality, including the
                       laboratory and the central control unit.
                    - Promotion and sales department : It is responsible
                       for putting the advertisement and promotional
                       policies, in addition to supervising the process of
                       distribution and sales.
                    - Human resources department: It comprises the financial department, the
                       personal affairs department, drivers and employees.

              The employees needed for the project are estimated at (30 employees with one
              shift) distributed to 5 administrative employees, 25 technical, production,
              maintenance and services employees.
              The total cost of salaries and wages, in addition to the social insurance is estimated
              at s.p 7,500,000.



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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          Third: Financial Study:
           Investment costs are estimated as follows:
            - Fixed capital: s.p 120,000,000.
            - Working capital: s.p 30,000,000.

           Annual operating costs are estimated as follows:
            - Commodity requirements: s.p 80,000,000.
            - Service requirements: s.p 6,500,000.
            - Wages and employment: s.p 7,500,000.
            - Depreciations: s.p 11,825,000,000.
            Variable costs are estimated at s,p 89,500,000. And fixed costs are estimated at s.p
            16,325,000.

            Economic and financial analysis of project:
            - Total investment costs = SYP 150,000,000.
            - Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
               166,028,000.
            - Total annual costs (the average lifetime of the project is 10 years) = 128,897,000.
            Notice: Revenues and costs are raised 5% per year during the production lifetime of
            the project.

            Economic parameters of the project:
               a. Total annual profits                                 = s.p 48,956,000
               b. Net profits                                          = s.p 37,131,000
               c. Pay-back period                                      = 3.1 years
               d. Rate of return of capital (investment)                = 33%
               e. Net present value at a discount rate of 15%           = s.p (70,690,834)
               f. Break-even point                                    = 31% (51,468,680)
               g. Internal rate of return                            = 26.8%
               h. The added value of the project                      = s.p 52,000,000
            The project has a large sensitivity towards the reduction of its revenues at a rate of
            20%, where the internal rate of return decreases to 15.4%.

            Most important required permits:
             - Licensing under law No. /8/ Syrian Investment Agency.
             - Industrial permit
             - Subscription and allotment
             - Building license
             - Administrative permit and ecological consent.
           The industrial city includes the service of the one stop shop, which provides all these
           permits.

                                                    81
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                                 A Summary of a Feasibility Study
          A Factory of Low and Medium Tension Electric Cables, Specialized Cables
                          Homs Governorate / Hasia Industrial City /

              About the project:
               The project is listed under the engineering
               industrial projects whose aim is to produce
               household and industrial electric cables, in
               addition to the specialized cables (telephone,
               computer network, interphone, monitoring
               cameras, professional cameras, warning)
               according     to     the    standard    Syrian
               specifications and the specification of the
               German VDE. One of the justifications for building this project is the increasing
               local demand for cables and the increasing external demand for the Syrian
               cables. These cables will be manufactured from copper, aluminum and granules
               of T.P.R , P.V.C, P.P. The annual production capacity is 7,000 tons. On the
               other hand, the project will depend on the local and foreign market in promoting
               and distributing its products. The factory is suggested to be built in the industrial
               city in Homs.

                 This summary of the feasibility study includes: marketing study, technical study
                 and financial study.
          First: Marketing Study:
            Product & quality:
             The project will produce two kinds of cables: insulated cables and bare cables.
             Insulated cables include power cables, control cables and telephone cables. Bare
             cables include copper, aluminum and mixed cables which are made of steel and
             aluminum. The quality of cables depends on the quality of conducting the electric
             current and the quality of insulation, i.e. not allowing the penetration of liquids to
             the wire and bearing the heat of maximum loading. Based on this, the level of the
             class will be identified as being first, second or third.

            Study of the demand
             The demand for electric cables arises from the end consumers and industrialists in
             order to use them in household installations, factories, service sectors and general
             lighting. The demand for these products is also largely linked with the processes of
             building, construction and periodical maintenance. Thus, the demand is estimated at
             63,000 tons per year, taking into consideration that the average consumption of the
             family is estimated at 70 kg of cables, either for the periodical maintenance or for
             the buildings and establishments which are still in progress. The study of the
             market shows us also the increasing demand for the other courtiers on the Syrian
             cables which are characterized by their good quality and their low price.



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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




            Study of supply:
             By studying the demand for the electric cables in the local market, we find that the
             local market includes 7 plants for manufacturing cables, in addition to some
             workshops which manufacture cables with a low production capacity. The
             production of the public sector amounted to 18,000 tons of cables in 2010.
             However, the private sector produced 62,000 tons as it appeared in a field study of
             the market. About 38,000 tons are exported to the external markets from the
             production of the private sector. On the other hand, the local market imported in
             2009 some kinds of special cables: 7350 tons according to a statistic to the Central
             Bureau of Statistics in 2010.

            Gap between the demand and the supply:
             The gap between the demand and the local supply of cables is estimated at an
             increase of the demand over the supply at an amount of 13,500 tons, where we see
             that the local companies meet 67% of the volume of the local demand and 12% of
             the imported demand, because some companies follow the policy of exporting to
             the foreign market. Accordingly, there is a gap between the supply and the demand.

            Competition & competitors:
             The industry of cables is centered in nine large factories (the General Establishment
             of Cables in Aleppo, the General Establishment of Cables in Damascus, Al-Suwaidi
             for Cables, Modern Syrian Cables, Kadan for Cables, Syrian Cables, Shahba’a for
             Cables, United for Cables, Modern Syrian Lines), in addition to some small
             workshops. The public sector establishments try to fully meet the need of the
             government institutions, in addition to launching some kinds in the markets, while
             the private companies launch their products in the local market, in addition to
             exporting some of their products to the Arab and European markets as well as
             South Africa. The process of competition governs the price and the quality of the
             products..

            Strategies of sale and distribution:
             The project will meet part of the Syrian market of cables, especially the markets of
             industrial and household electricity which form a permanent demand for these
             products, in addition to the process of exportation which will form 50% of the
             production capacity of the project and which will target the Iraqi, Lebanese,
             Jordanian and European markets. Moreover, business relations will be set up with
             the engineers, contractors and companies of manufacturing electric appliances
             because they form a large demand for the products of the project.

            SWOT:
             a. Opportunities and points of strength:
                - The increasing external demand for the Syrian cables by the foreign
                   markets.
                - The increasing number of household, industrial, and service building.


                                                    83
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                 -  The easiness of promoting the products of
                    the project in the local and foreign
                    markets.
              b. Threats and points of weakness:
                 - The correlation of the prices of the raw
                    materials of the products with the global
                    prices of the international stock market.
                 - The type of the plastic granules and their quality and their effect on the
                    quality of the final product.

            Revenues of the project:
              The annual revenues of the project when it works with a production capacity of
              7000 tons are estimated at 3,050,000,000 per year as a result of selling insulated
              electric and bare cables (power, control, telephones, copper, aluminum, mixed),
              based on computing the production of 7000 tons per year with an average price of
              435,714 per ton of cables.

          Second: Technical Study
            Technical description of the project:
              a. Location: the project will be built in the industrial city in Hasia in Homs
                 governorate which is characterized by being in the center of the Syrian
                 governorates and next to the Lebanese border. This facilitates the process of
                 exporting and reducing the cost and time, in addition to the need of Hama and
                 Homs to a factory of cables.

               b. Land and Building: (SYP 195) million
                  The project will be built on a piece of land of about 25 donums at a value of 45
                  million Syrian pounds. As for the building, it will comprise the administrative
                  department, hangars for the equipments and instruments, storehouses for the
                  raw materials and final products, quality control center and public utilities with
                  an estimated cost of SYP 100 million, in addition to the infrastructure of the
                  project such as the sewage network, electricity and lighting system, ground
                  scale,...at a value of SYP 50 million.

               c. The equipments of the project and the production process: (SYP 650
                  million, € 9.3 of million, European origin).
                  The production process passes many stages according to the function of each
                  machine and the kind of cables to be made (single, double, telephone,
                  control,…):
                   1- Drawing machine, where copper or aluminum wires pass on it. Wires are
                         drawn till they reach the required diameter.
                   2- Stranding machine: It strands cables according to the required diameter
                         (0.5 – 500) mm.

                                                     84
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                   3-   Insulating machine: Wires can be insulated with one, two or three coats.
                   4-   Reinforcing machine: some cables are reinforced by a metal net (aerial
                         cables) or metal plates (ground cables).
                   5-   Examining devices for checking insulation, conduction, tension of
                         collapse…).
                   6-   Folding and packaging machine.
                   7-   Other equipments: electricity converter, electricity generator, emergency
                         and protection system.

               - Ecological effect of the project:
                  Through the ecological study of the project we see that the project does not
                  produce any harmful remains to the environment. On the other hand, waters of
                  cooling can be recycled. As for the noise of the machines, technicians will be
                  provided with protecting stethoscopes. And as for the emitting vapors from the
                  process of insulation, the project will be provided by draining filters to reduce
                  the emission of vapors and gases.

               d. Means of transportation (SYP 30 million)
                  - They consist of 8 trucks, 5 service cars, 2 Pullmans, 4 forklifts.
               e. Furniture and furnishing: (SYP 2 million).
                  - Office equipments for the administrative office, computers, non-cut units,
                    eclectic equipments.
               f.Expenses of incorporation and permits (SYP 10 million).
                  - Expenses of engineering studies (architectural, civil,…), feasibility study,
                    administrative expenses, charges of permits…, wages of the supervisors of
                    the study and installation.

               g. Commodity requirements /supplies/: (SYP 2,33 billion).
                   - Raw materials: (copper wires, aluminum, granules, plates) SYP
                     2,265 billion.
                   - Cooper and aluminum in the form of bundles or packets weighing 3 – 3.5
                     tons, imported from Germany or Belgium. Aluminum is imported from
                     France.
                   - Plastic granules (PP,PVC), imported from Saudi Arabia, south Korea or
                     from the local market. (in case of building a factory for producing
                     granules).
                   - Rubber granules (TPR), locally-made metal plates
                   - Utility expenses: (industrial electricity, water for cooling, industrial
                     fuel): SYP 40 million.
                   - Packing and packaging requirements; SYP 20 million.
                   - Other commodity requirements: SYP 6.5 million.


                                                    85
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




               h. Service requirements: SYP 84.3 million (maintenance (10) million, clothes
                  for employees and meals and experiments (20 million), advertisement,
                  promotion, external and internal specialized exhibitions(50) million, cables
                  sections presented as samples and other expenses (4.3) million.

               i. Organizational and administrative structure, salaries and wages:
                     The organizational and administrative structure of the project consists of:
                     - Production and purchases department: It is responsible for all stages of
                        the production process, in terms of studying and buying raw materials,
                        supervising the process of production and testing the final product.
                     - Administrative and legal department: It is responsible for running
                        administrative affairs, correspondence, archive, organizing contracts.
                     - Marketing and sales department: It observes and studies the motion of
                        the market and prepares the future work plan and the required developing
                        plan. It also supervises promotion, sales and distribution.
                     - Finance affairs department: It studies and analyzes the processes of
                        selling and buying, in addition to organizing the turnover of revenues
                        and expenses and preparing the financial budgets of the project.
                     - Human resources department: It supervises the process of attracting and
                        recruiting the needed employment and try to develop their skills and
                        experiences, in addition to supervising the staff ID’s.

                 The employment needed for the project is estimated at 450 workers with one
                 shift, distributed to 400 technicians, 50 administrative officials. The total cost of
                 salaries and wages, including social insurances, is estimated at SYP 125 million.

          Third: Financial Study:
            Investment costs are estimated as follows:
             - Fixed capital: SYP 887 million.
             - Working capital: SYP 300 million.

            Annual operating costs are estimated as follows:
             - Commodity requirements: SYP 2330 million.
             - Service requirements: SYP 84.3 million.
             - Wages and employment: SYP 125 million.
             - Depreciations: SYP: 80.9 million.
            Variable costs are estimated at SYP 2464.3 million, and fixed costs are estimated at
            SYP 155.9 million.




                                                      86
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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




            Economic and financial analysis of the project:
             - Total investment costs = SYP 1187 million
             - Value of annual revenues = (the average lifetime of the project is 10 years) =
               SYP 3661.9 million.
             - Total annual costs (the average lifetime of the project is 10 years)   = SYP
               3109.4 million.

          Notice: Revenues are raised 4% and costs are raised 4% during the production lifetime
          of the project (10 years).

            Economic parameters of the project:
             a. Annual gross profits                                  = SYP 633.4 million.
             b. Net profits                                          = SYP 552.5 million
             c. Pay-back period                                       = 1,9 years
             d. Rate of return of capital (investment)                =53 %
             e. Net present value at a discount rate of 15%           = SYP 1598.1
             f. Break-even point                                      = 22%
             g. Internal rate of return                              = 46.4%
             h. Added value                                          = SYP 1331.9%

            If revenues fall 10%, the internal rate of return will be 16.6%.

            Most important required permits:
             - Industrial permit .
             - Licensing under law No. /8/ Syrian Investment Agency.
             - Subscription and allotment.
             - Building license.
             - Administrative permit and ecological consent.

            The industrial cities include the service of the one stop shop, which provides all these
            permits.




                                                      87
                                                                                                             
Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                                     A summary of a feasibility study
                         of a Factory for the Production of spare parts for cars
                                     (valves, gear boxes and others)
                          Industrial City of Hisia / / Homs Governorate In The

          About the project:
           The project is classified under the engineering industries,
           it aims at production of car spare parts (valves, gear
           boxes and others). Parts will be produced by the project
           considered among pieces that subject to common faults
           by aging in all types of vehicles. This project is the first
           of its kind in Syria, which recently entered the world of
           car assembly, where three factories for car assembly
           have been established in Syria so far. The project
           requires highly efficient quality in the manufacturing
           process, especially with the diversity and the different
           types and models of vehicles in Syria. The project is subject to expansion in part
           types manufactured in future.
           There is a great need for products of this project because of the large and growing
           number of vehicles in Syria and the inevitability for the change of these parts of
           vehicles that are still entirely imported. It is proposed to build the project in Homs
           Governorate (Industrial City).

                The summary of the feasibility study includes: marketing , technical and financial
                studies.

        First: Marketing study:
               Product & quality :
                Gear box in vehicles, is one of the basic equipment for the transfer of movement. Its
                function is to change torque and movement speed according to the requirements of
                the working conditions of the vehicle. All ground vehicles are provided with a gear
                box containing several gearwheels for front movement and others for rear movement.
                The gear box consists of several tooth-wheels (gear) evenly linked with each other in
                more than one case at certain positions to give different speeds. The valves are used
                as carriers for pistons that move up and down inside the engine. The interior walls of
                the valves are very smoothed, that help to tighten the lock between the piston and the
                cylinder to prevent gas leakage between them.

               Study of demand:
                Demand for car parts created through requirements of existing vehicles in the
                country, which is estimated at 1.739 million vehicles in 2009. The average annual
                domestic requirement of parts that will be produced by the project is estimated at
                /200,000/ pieces, which recently being totally imported from abroad.


          1
              The Statistical Abstract 2010 
                                                        88
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Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




            Study of supply:
             The number of cars in Syria amounted to about / 1,738,833 / car in 2009. The
             following table shows the evolution of the number of vehicles in Syria during the
             period (2005-2009), according to data from the Central Bureau of Statistics:

             Year                    2005         2006         2007         2008                           2009
             Number of vehicles      1067529      1213034      1367767      1537206                        1738833

            Gap between demand and supply:
             Syria imported about / 3135 / tons of gearboxes and / 1853 / tons of different valves
             in 2009 at a total value of both amounted to SYP 764 million. This demonstrates the
             importance of establishing this project. Since it’s the first of its kind, the project will
             seek meeting part of local market and regional market needs in the future after
             covering the domestic demand. Obviously this will generate large profits for the
             project and will stop the bleeding caused by the large import of these parts.

            Competition & competitors:
             There is no real domestic competition due to the absence
             of manufacturing of        these materials locally. The
             competition lies within what’s imported, which is
             characterized by the ability to compete because of the
             abundance of factory production, that is reflected on costs
             and consequently on prices of products from the mother
             country, in addition to enjoying good reputation for some
             of the brands on the local markets, which requires the
             commitment of the project with specifications and
             European standards.

            Strategies of sale and distribution:
         -   local     markets: including all the governorates,
             particularly Aleppo and Damascus in addition to Homs
             -the site of the project- at a rate of 100% of p
             roduction. The project intends to export 20% of the
             production in the future to the markets of neighboring
             countries.
         -   Regional markets: (the Gulf States, Iraq, Jordan,
             Lebanon) at a rate of 20% of production in the future due to the lack of these
             industries in those countries.

          (SWOT):
          a. Opportunities and points of strengths:
            - Availability of good national expertise in the mechanic field.
            - The growing local demand for car parts.
                                                    89
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




             - Export to neighboring markets in the future (Iraq, Jordan, Lebanon and the Gulf).
             - Joining the Arab Free Trade Area by Syria, , which opens up new horizons for
                export.

          b. Threats and points of weakness:
            - Lack of confidence in pre- tested local products.
            - Competition of brands in the domestic market.
            - The continues evolution in vehicle manufacturing techniques.

            Revenue of the project:
             Annual revenues of the project for producing / 10000 / gearboxes in addition to
             project revenues from the production of valves and various other pieces are
             estimated at SYP 120,000,000.

          Second: Technical Study:
          Technical description of the project:
         a. Location: The Industrial City of Hisia in Homs Governorate for its position which
            intermediates the geographical map of Syria, that helps in the process of selling,
            distribution and export in the future in addition to the advantages that the industrial
            city enjoys.

         b. Land and building (SYP 21,000,000)
            The factory will be established on a land area of not less than eight donums,
            according to an internal scheme commensurate with the requirements of the
            production process and quality control conditions related to the production process.
            The value of the land is estimated at SYP 13,000,000, and to SYP 8,000,000 for
            constructions.

         c. Machinery and equipment: (SYP 85,000,000 Chinese origin)
            The project consists of two main production lines as follows:
         - Primal formation machine / 120 / ton, with a mechanical balance and container.
         - Mixer and cutter / 600 / liter with a
            hydraulic door.
         - A shaping, cutting and grinding machine
            with three heads and four engines.
         - Two surface hot piston / 350 / ton.
         - Mono abrasion machine for sheets (by
            sand).
         - Modern lathes and their fittings and packaging machine.
         - Three types of moulds / 25 / of each type, and other moulds for the preparation of
            sheet parts, moulds of primal formation and moulds of the hot piston.

                                                     90
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




         - A complete disc saw, fixed driller, air compressor and furnace for temperature
             treatment.
         -   An oven for moisture absorption up to / 100 / degree.

         d. Means of production and service transportation: (SYP 4,000,000).
         e. Furniture and furnishing: (SYP 1,500,000).
         f. The expenses of incorporation and licenses: (SYP 47,500,000) Including
            concession and trade mark.
         g. Commodity requirements (SYP 58,000,000).
            - Raw materials (metals, oxides and resin): SYP 45,000,000.
            - Other commodity supplies (electricity + water + fuel): SYP 13,000,000.
         h. Service requirements (maintenance, mail, telephone and Advertising, ...): (SYP
            4,000,000).

         i. Administrative structure, salaries and wages:
            The administrative and organizational structure of the project consists of the
            following departments:
             - Production Department: it is responsible for all phases of the production
                 process, in addition to the quality division.
             - Marketing and Sales Department: this department is responsible for developing
                 advertising and promotional policies and supervision of distribution and sale
                 operations.
             - Human Resources and Finance Department: It comprises the Finance Office,
                 Personal Affairs Office, drivers and workers.
            The estimated need of workers is (50 workers, one shift) distributed to four
            administrative officials, 18 mechanic engineers, 28 technical, production and
            maintenance workers, and guards. The estimated at cost of salaries and wages,
            including social security is SYP 12,000,000.

        Third. Financial study:
            Estimation of investment costs:
         -   Fixed capital: SYP 159,000,0000.
         -   Working capital: SYP 26,000,000.

            Estimation of the annual operating costs:
         -   Commodity requirements: SYP 58,000,000.
         -   Service requirements: SYP 4,000,000.
         -   Wages and employment: SYP 12,000,000.
         -   Depreciation: SYP 19,500,000.
             Variable costs are estimated at SYP 66,000,000, and fixed costs to SYP 27,500,000.


                                                    91
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




             Economic and financial analysis of the project:
         - Total investment costs = SYP 185,000,000.
         - The value of annual revenues (the average lifetime of the project is 10 years) = SYP
              150,935,000.
         - Total annual costs (the average lifetime of the project is 10 years) = SYP
              110,514,000.
          Notice: Revenues and costs increased at a rate of 5% annually over the production
          lifetime of the project.

            Economic parameters of the project:
             a. Total annual profits = SYP 59,921,000.
             b. Net profits = SYP 40,421,000
             c. Pay-back period of the invested capital = 3.1 years.
             d. Rate of return of capital (investment) = 32%.
             e. Net present value at a discount rate of 15% = SYP 84,717,754.
             f. Break-even point = 40% (SYP 60,374,000).
             g. Internal Rate of Return IRR = 26.5%.
             h. Added value = SYP 62,000,000.

             The project is largely sensitive towards the fall in revenues at a rate of 20%, where
             the internal rate of return falls to 8.7%.

            Most important required permits:
             - Industrial permit.
             - Licensing under law No. /8/ Investment Commission.
             - Subscription and allotment.
             - Building license.
             - Administrative permit and ecological consent.
             The industrial cities includes the services of one-stop shop, which provides all these
             permits.




                                                     92
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                                  A Feasibility Study Summary of
                   A Factory of Producing Household Utensils from Alloys
                        Homs Governorate / Industrial City of Hasia

           About the project:
            The project is listed under the engineering projects
            whose aim is to produce household utensils from
            alloys, which is considered a developmental trend of
            the existing industries both in formation and in the
            superficial coverage by the technology of static
            electricity. This helps in getting a product of an
            esthetic and use value matching the international
            scientific standards.
            These products form an essential need for houses,
            restaurants and hotels. And the need increases for
            harmless kitchenware realizing the esthetic
            appearance and solidity. This is why the project tends to make kitchenware of high
            quality specifications. The project is suggested to be built in the industrial city of
            Hasia in Homs governorate.

          The summary of the feasibility study includes: marketing study, technical study and
          financial study.

          First: Marketing Study
           Product & quality:
             This study aims at producing different kinds of household utensils needed in the local
             market and can be exported to the external market. The household utensils are:
             cooking pans, frying pans, trays, squeezers, graters, peelers, mincing machines and
             tableware (spoons, forks, knives…etc).

           Study of demand:
            Exports of tableware and kitcheneare of different kinds amounted to 4835 tons in
            2010 at a vlaue of s.p 343035 thousnd as stated in the data of the Central Bureau of
            Statistics. The tableware industy is considered one of the important industries
            demanded all the time. The concerned project is considered a development to the
            existing industries which are based on forming alloys, where the present available
            products are not typical and they are not governed by certain specifications. With the
            use of the same equipment the product could be typical with high quality
            specifications. Consequently, this will realize profitability and cover the gap in the
            local market.

            The demand for the products of the project arises from the normal consumption of
            houses, the consumption of restaurants and hotels and the exportation to the foreign
            markets.


                                                     93
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




           Study of supply:
            The imports of tableware and kitchenware of different kinds amounted to 1047 tons
            in 2010 at a value of s.p 63282 thousnd , in addition to the household utensils
            available in the market from the local industry.

           Gap between the demand and the supply:
            In addition to the existence of imported products, there is a
            variance in the kinds of the local products. The project will
            launch products of high quality able to compete with the
            imported products in terms of quality and price. Packaging will
            also be modern, in order to meet the desire of the local and
            foreign consumer as for the products prepared for exportation.
            This will generate good profits to the project.

           Competition & competitors:
            There are 9 factories of household utensils in Syria. Most of them depend on
            traditional manual technologies. There are also a number of workshops producing
            one kind of household utensils. The most pioneering companies in this area in Syria
            are:
              - Wattar Company (Damascus)
              - Al-Masri Company (Damascus Countryside)
              - Three Fives Company (Aleppo).
              - Ramco Company (Damascus Countryside

            The project tends to use stainless materials matching the
            international health conditions, in addition to suggesting
            innovated designs meeting the consumer's response to the esthetic and use
            considerations through:
              - Choosing stainless and anti -acid and anti-alkaline metal alloys resulting from
                 the use of food materials.
              - The proposed manufacturing preserves the level of cleanliness which gets in
                 line with the public health.
              - Mechanizing most of the stages of production. This helps reducing the common
                 mistakes of manual production, and helps the commitment to the standard
                 conditions of the product.

           Strategies of sale and distribution:
            - Local markets: All governorates, especially (Homs, Damascus, Damascus rural
               area, Aleppo, Lattakia) at a rate of 60% of the product, because most restaurants
               and hotels are situated in these areas, in addition to the density of population.
            - Regional markets: (Gulf States, Iraq, Jordan) at a rate of 40% of the production,
               due to the demand for the Syrian industries.



                                                   94
                                                                                                         
Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




           SWOT:
            a. Opportunities and points of strength:
              - The availability of raw materials in reasonable prices.
              - Exportation to the neighboring markets which do not produce such products.
              - Most available products in the market use galvanized iron plates, which is
                considered a breach to the health conditions because they interact with the acids
                existing in the foodstuffs and make them exposed to rust.
              - Making new innovations.
              - Joining the Free Arab Trade Zone by Syria. This opens new horizons of
                exportation.

           b. Threats and points of weakness:
             - The competition of plastic and glass products to their
               metal counterparts.
             - The competition of the existing brands and the
               Chinese industries in the local market.

           Revenues of the project:
            The annual revenues of the project for producing 200 tons of household utensils are
            estimated at s.p 95,000,000.

          Second: Technical Study:
           Technical description of the project:
            a. Location: Hasia Industrial City in Homs in the middle of Syria. The advantages
               and exemptions granted by the regulations of this industrial city will be benefited
               from, in addition to the near location from the markets of distribution.

            b. Land & building: (s.p 17,000,000)
               The factory will be built on an area of no less than 4 donums (a measure of land,
               1000sq. m.) with a height of no less than 4 meters.Reinforced concrete bases will
               be provided for fixing machines and equipment according to an internal chart fit
               to the requirements of the production process and the conditions of quality control
               related to the process of production and assembling and packaging. The value of
               the land is estimated at s.p. 6,800,000 and the building is estimated at s.p.
               10,200,000.

            c. Machines and equipment: (s.p. 52,000,000 of west- European origin)
               The factory is divided in accordance with the type of machines, the motion of
               production and technical specifications of the equipment as follows:
               - Eccentric scissors provided with operating guides to help take the exact
                  required dimensions.
               - Cutting machine to cut according to the required internal and external forms.
               - Hydraulic press and manual press with a group of molds.
                                                    95
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                 - Formation stamps for coarsening surfaces, installed on the hydraulic press to
                   prevent sliding and help the cohesion of the parts of the product.
                 - Drills and bending machines provided with operating guides.
                 - Welding machine and basins of treatment.
                 - Steam furnace , dryer and other equipments.

            d. Means of transportation (s.p. 6,000,000)
            e. Furniture: (s.p 2,000,000).
            f. Expenses of incorporation and permits (s.p 3,000,000).
            g. Commodity requirements: (s.p 51,000,000).
               - Raw materials (various plastics, chrome, nigel, Stanly, accessories, packing and
                 packaging materials ): s.p 46,000,000.
               - Other commodity requirements (electricity, water, fuel): s.p 5,000,000.
            h. Service requirements: (maintenance, mail, telephone, advertisements,
               promotion, (s.p 6,000,000).

            i. The organizational structure, salaries and wages:
               The organizational and administrative structure consists of the following
               departments;
                - Production department: It is responsible for the whole stages of the
                   production process till the process of
                   checking and packing and packaging
                - Promotion and sales department : It is
                   responsible for putting the advertisement and
                   promotional policies, in addition to
                   supervising the process of distributing and
                   selling.
                - Human resources department: It comprises the financial department, the
                   personal affairs department, drivers and employees.

          The employees needed for the project are estimated at (35 employees with one shift)
          distributed to3 administrative employees, 32 technical, production, maintenance and
          guard employees.
          The total cost of salaries and wages, in addition to the social insurance is estimated at
          s.p 7,500,000:

          Third: Financial Study:
           Investment costs are estimated at:
            - Fixed capital: s.p 80,000,000.
            - Working capital: s.p 20,000,000.



                                                     96
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




           Annual operating costs are estimated as follows:
            - Commodity requirements: s.p 51,000,000.
            - Service requirement: s.p 6,000,000.
            - Wages and employment: s.p 7,500,000.
            - Depreciations: s.p 7,910,000.

          Variable costs are estimated at s,p 58,800,000. And fixed costs are estimated at s.p
          13,610,000.

           Economic and financial analysis of the project:
            - Total investment costs = s.p 100,000,000.
            - Value of annual revenues = (the average lifetime of the project is 10 years) =
              s.p 119,490,000
            - Total annual costs (the average lifetime of the project is 10 years) =
              s.p 87,568,000

          Notice: Revenues and costs are raised 5% during the production lifetime of the project.

           Economic parameters of the project:
              a. Total annual profits                                  = s.p 39,831,000
              b. Net profits                                           = s.p 31,922,000
              c. Pay-back period                                       = 2.5 years
              d. Rate of return of capital (investment)                = 40%
              e. Net present value at a discount rate of 15%           = s.p (76,207,062)
              f. Break-even point                                      = 30% (35,847,000)
              g. Internal rate of return                               = 33.3%
              h. The added value of the project                       = 44,000,000

          The project has a large sensitivity towards the reduction of its revenues at a rate of 20%,
          where the internal rate of return decreases 8.5%.

             Most important required permits:
              - Industrial permit
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allotment
              - Building license
              - Administrative permit and ecological consent.

          The industrial cities include the service of the one stop shop, which provides all these
          permits.




                                                      97
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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




                                    A Summary of a Feasibility Study
                              A Project of Producing Bricks & Tiles All sizes
                                 Homs governorate/ Hsia Industrial City/

               About the project:
                The project is listed under the engineering
                industries. It aims at manufacturing cement
                bricks and tiles in different sizes, different
                shapes and different colors fit to the general
                demand. Hasia was chosen, so that the
                project can provide the demands of the
                investment and residential projects in Homs
                governorate. About 20% of the production
                will be exported outside the country. The
                project is considered necessary due to the
                increase of the number of villas, residential
                and non-residential complexes in the governorate, and due to the development of
                the methods of construction and the method of finishing works, and because of
                adopting the latest products of decoration.

          First: Marketing Study:
                 Product & quality:
                  The project will produce high quality isolating
                  materials( bricks and tiles) manufactured according
                  to latest technologies with different sizes and
                  different colors.

                 Study of the demand
                  In 2009 nearly 130,579 residential unit and 712 industrial establishments were
                  given licenses. The need of the licensed buildings from the materials of finishing
                  works is estimated at SYP 27,980 billion. These numbers are continuously
                  increasing because of the demographic growth which is estimated at 500,000 per
                  year.

                 Study of supply:
                  The local product approximately covers 73% of the demands, and 27% of the need
                  is imported from the Arab and foreign countries.

                 Gap between the demand and the supply:
                  The Syrian imports of the materials of finishing works are practically considered a
                  gap. Added to it is the gap created as a result of the instability of the local product
                  and its inability to cover the increasing and continuous demand for the studied



          
              Statistics group 2010
                                                         98
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




              materials, especially that the local products suffer from the problem of not
              satisfying the customers' taste because of the little assortment of the product.

             Competition & competitors:
              There are 6 factories producing colored bricks in Syria. Three ones are in Homs.
              The most important producers are:
          -   Saudi Yamamah Bricks Factory
          -   Betra Factory for Cement Bricks
          -   Wehbah & Askari & ABdulbaset Factory
              The project may face a bigger competition from the foreign existing brands in the
              local market, especially the Turkish and Saudi brands.

             Strategies of sale and distribution:
          -   Local markets: Nearly 80% of the product will be marketed locally.
          -   Regional markets: 20% of the product will be exported to the regional markets,
              especially Iraq, where there are no bricks factories.

           SWOT:
           a. Opportunities and points of strength:
          - The project zone (Homs) is considered a strongly promising area in terms of the
              construction activities.
          - The nearness of the project from the lurking places of raw materials.
          - The local and ecological laws which assert the necessity for increasing all kinds of
              insulating materials, which opens the door for new consumers.
          - The increasing demand for the product which corresponds with the increase of
              licensed buildings and the rise of population.

          b. Threats and points of weakness:
          - The large competition of the foreign and local brands, where there are excellent
             types of finishing works materials.

             Revenues of the project:
                        Marketing       Product        QTY/ PIECE   PRICE                            TOTAL
                        Local         Cement bricks     2,400,000   SYP 50                        SYP 120,000,000
                        Exportation   Cement bricks      600,000     $ 1.3                        SYP 35,880,000
                        Total                                                                     SYP 155,880,000


          Second: Technical Study:
           Technical description of the project:
          a. Location: Homs, Hasia. This location was
             chosen for many reasons. The most important
             of which are:


                                                      99
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




           - The constructional motion of the city and the governorate in general.
           - The availability of raw materials.
           - The location of the governorate in the middle of country.

          b. Land & Building: (SYP110,000,000 )
             The building will be built on a piece of land of no less than 25,000 m2 fit to the
             need of the project. It is nearly estimated at SYP 42,500,000.
             As for the building, it will be designed according to an internal chart fit to the
             requirements of the production process and the conditions of quality. Its cost is
             nearly estimated at SYP 67,500,000.

          c. Machinery and equipment: (SYP 68,500,000 of European origin)
             The project consists of the following lines:
          - A cutting machine.
          - A breaker with two cylinders.
          - An ordinary grinding cylinder
          - A two-axis mixer.
          - A machine for cutting shapes in the form of slices.
          - A machine for prompting boxes
          - A conveying belt.

          d. Means of transportation (SYP 16,100,000)
          e. Furniture and furnishing: (SYP 700,000).
          f. Expenses of incorporation and licenses (SYP 5,700,000).
          g. Commodity requirements: (SYP 56,884,000).
          -  Raw materials: red sand, clay, white cement and other chemical materials.(SYP
             48,393,000).
          - Other commodity requirements (electricity, water, fuel): SYP 8,491,000.
          h. Service requirements: (maintenance, mail, telephone, advertisement,
             promotion,…): SYP 3,443,000.

          i. Administrative structure, salaries and wages:
              - Production department: It is responsible for all stages of the production
                  process, in addition to the laboratory and controlling quality.
              - Promotion and sales department: It is responsible for drawing up the
                  advertisement and promotional polices as well as supervising the processes of
                  distribution and sales within the different showrooms.
              - Human resources and finance department: It comprises the financial
                  directorate, personal affairs directorate, drivers and workers.
             The employment needed for the project is estimated at 70 workers with one shift,
             distributed to 3 administrative officials, 34 experts, technicians, specialized workers
             and 33 ordinary and provisional workers. The total cost of salaries and wages,
             including social insurances, is estimated at SYP 20,500,000
                                                      100
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          Third: Financial Study:
           Investment costs are estimated as follows:
          - Fixed capital: SYP 201,000,000.
          - Working capital: SYP 29,000,000.

             Annual operating costs are estimated as follows:
          -   Commodity requirements: SYP 56,884,000
          -   Service requirements: SYP 3,443,000.
          -   Wages and employment: SYP 20,500,000.
          -   Depreciations: SYP: 14,725,000.
              Variable costs are estimated at SYP 67,838,400, and fixed costs are estimated at
              SYP 27,713,600.

             Economic and financial analysis of the project:
          -   Total investment costs = SYP 230,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              178,699,000.
          -   Total annual costs (the average lifetime of the project is 10 years) =SYP
              105,483,000.
              Notice: Revenues and costs are raised 3% during the production lifetime of the
              project.

             Economic parameters of the project:
               a. Annual gross profits                            = SYP 87,941,000
               b. Net profits                                      = SYP 73,216,000
               c. Pay-back period                                 = 2.6 years
               d. Rate of return of capital (investment)       = 38%
               e. Net present value at a discount rate of 15% = SYP 169,363,454.
               f. Break-even point                               = 27 (48,248,730)
                g. Internal rate of return                          =33.6 %
                h. Added value                                       = SYP 98,996,000
              The project is largely sensitive towards the fall of its revenues at a rate of 20%,
              where the internal rate of return falls to 17.2%.

             Most important required permits:
               - Industrial permit
               - Licensing under law No. /8/ Syrian Investment Agency.
               - Subscription and allotment
               - Building license
               - Administrative permit and ecological consent.
              The industrial cities include the service of the one stop shop, which provides all
              these permits.
                                                   101
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                               A Summary of a Feasibility Study
                          A Project of Producing Electronic Circuits IT
                                      Lattakia Governorate

          About the project:
           The project is listed under the projects of
           engineering industries. It aims at producing
           various electronic circuits, depending on a high
           scientific and technical Syrian employment in
           Lattakia which is considered a port for the
           coming technology and sciences from the west.
           The electronic projects have a special importance in Syria and in the Arab world in
           general, because they are considered the most important pillars of the modern
           technology.
           This summary includes: marketing study, technical study, financial study.

          First: Marketing Study
           Product & quality:
             The project will produce state-of-the-art products of the following electronic circuits:
             - Measuring circuits (pressure, temperature, liquid
                 levels).
             - Generating signal circuits.
             - Control circuits
             - Logical circuits
             - Displaying screen circuits and many other circuits.

           Study of demand:
            In general, the demand for the electronic systems is affected by the technology used
            in most establishments and miscellaneous utility (commercial, industrial, medical,
            service). Syria's need of these circuits is estimated at approximately 2,500,000 –
            3,000,000 various electronic circuits. The growth of the annual demand is estimated
            at 3%.

           Study of supply:
            There is no local production for these products, with the exception of some amateurs
            who produce them manually.

           Gap between demand supply:
            Since Syria imports 100% of its need from abroad, the opportunity is too large for
            the studied project to enter the local market and sell its products provided that the
            studied project enables to compete with the imported products in terms of quality and
            price.



                                                     102
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Investment Opportunities Guide
                                                                                                               Beat Al khebrah
                                                                                                                             Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




                Competition & competitors:
                 There are no similar factories to the studied project neither in the project area
                 (Lattakia) nor in Syria.

                 Strategies of sale and distribution:
                 - Local markets: 80% of the project will be marketed in the locally.
                 - Regional markets: 20% will be exported to Iraq, Jordan and Lebanon to realize
                     an income of the foreign currency.

                  SWOT:
                  a. Opportunities and points of strength:
                   - The availability of skilled manpower (with little training).
                   - The availability of raw materials for this industry locally.
                   - The large and increasing demand by the industrial plants on the studied
                      products.
                   - The inexistence of internal competition.
                   - The possibility of obtaining a franchise or a cooperation with distinguished
                      international companies in this area.
                   - This industry is considered an input to the infrastructure of electronic industry
                      and an introduction to the nano-technology.

                  b. Threats and points of weakness:
                   - The competition of the experienced foreign products in this field.
                   - The problem of the integration of the infrastructure for such projects.

           Revenues of project:
         Marketing        Product                   Qty        Unit       Price                             Total/SYP
         Locally     Electronic circuits          240,000      Piece   SYP 1,200                         SYP 288,000,000
         exportation Electronic circuits          60,000       Piece   $ 28                              SYP 77,280,000
         Total                                                                                           SYP 365,280,000

          Second: Technical Study:
            Technical description of project:
              a. Location: Lattakia, where the employment is
                  available (since the project mainly depends on
                  the technical and engineering experiences.

                   b. Land and Building: (SYP 71,000,000)
                      The project will be built on a piece of land of no
                      less than 7,000 m2 at a value of SYP 14,000,000.



                                                         103
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                    The building is designed according to an internal chart fit to the requirements of
                    the production process and the conditions of controlling quality in terms of
                    production and storing at a value of SYP 57,000,000.

             c. Machinery and equipment: (SYP 460,000,000 of a west-European origin.).
                The production line consists of the following sections:
                - Section of receiving plastic raw materials.
                - Section of programming and formation as
                    needed.
                - Section of cooling.
                - Section of inserting metal materials.
                - Section of forming circuits and extensions.
                - Section of connecting condensers, diodes,
                    and tiny parts.
                - Section of packing.

             d. Means of transportation (SYP 4,800,000 )
             e. Furniture and furnishing: (SYP1,500,000).
             f. Expenses of incorporation and licenses (SYP 7,700,000).
             g. Commodity requirements: (SYP117, 315,000).
                -
                Raw materials: plastic materials, tin, copper, tiny pieces, condensers and other
                 materials, in addition to the spare parts of the machines and the materials of
                 packing and packaging: 102,117,000.
              - Other commodity requirements (electricity, water, fuel): SYP 15,198,000.
             h. Service requirements: (maintenance, mail, telephone, advertisement,
                promotion,…: SYP 13,050,000).

             i. Administrative structure - salaries and wages:
                The administrative and organizational structure of the project consists of:
                - Production department: It is responsible for all stages of the production
                    process, in addition to the laboratory and quality.
                - Promotion and sales department: It is responsible for drawing up the
                    advertisement and promotional polices as well as supervising the processes
                    of distribution and sales within the different markets and halls.
                - Human resources and finance department: It comprises the financial
                    directorate, personal affairs directorate, drivers and workers.

                        The employment needed for the project is estimated at 52 workers with one
                        shift, distributed to 4 administrative officials, 36 experts, specialized
                        workers, 12 ordinary and provisional workers. The total cost of salaries and
                        wages, including social insurances, is estimated at SYP 17,700,000.



                                                       104
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          Third: Financial Study:
              Estimation of investment costs:
              - Fixed capital    : SYP 545,000,000.
              - Working capital: SYP 55,000,000.

              Estimation of annual operating costs:
              - Commodity requirements (supplies): SYP 117,315,000.
              - Service requirements                : SYP 13,050,000.
              - Wages and employment                : SYP 17,700,000.
              - Depreciations                      : SYP: 51,650,000.

               Variable costs are estimated at SYP 134,835,000, and fixed costs are estimated at
               SYP 64,880,000.

               Economic and financial analysis of project:
               - Total investment costs     = SYP 600,000,000.
               - Value of annual revenues = (the average lifetime of the project is 10 years) =
                  SYP 418,752,000
               - Total annual costs (the average lifetime of the project is 10 years) =
                  SYP 219,453,000.
              Notice: Revenues and costs are raised 3% during the production lifetime of the
              project.

              Economic parameters of project:
                a. Annual gross profits                                = SYP 250,949,000.
                b. Net profits                                         = SYP 199,299,000.
                c. Pay-back period                                    = 2.4 years
                d. Rate of return of capital (investment)             = 42%
                e. Net present value at a discount rate of 15%       = SYP 535,684,011
                f. Break-even point                                   = 25% = SYP 104,688,000.
                g. Internal rate of return                            = 37.3%
                h. Added value                                        = SYP 247,965,000

          The project is largely sensitive towards the fall of its revenues 20%, where the internal
          rate of return decreases to 23.2%.

              Most important required permits:
               - Licensing under law No. /8/ Syrian Investment Agency.
               - Industrial permit / Ministry of Industry.
               - Administrative permit / Lattakia governorate – Technical Services
               - Ecological consent / Lattakia governorate – Directorate of Environment


                                                    105
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                                 A Summary of a Feasibility Study
                                  Micro Controller Programming
                                      Lattakia Governorate
           About the project:
            The project is classified under the electro-
            engineering     industries.    It    aims    at
            programming           micro         controllers
            (programmed auto control applications).
             It is considered one of the limited existent
            projects. The justification for building the
            project is to meet the increasing demand in
            the project area for these products and make
            use of the local experiences in this field (engineers, graduates of institutes and
            professional secondary schools). The project will program non-typical controllers
            (as needed) , in addition to the requested controllers in the market.

              This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
             Product & quality:
              Micro controllers are circuits regulating the motion and work in electric or
              electronic devices. They organize the motion of engines, and machines. They are
              used in lighting so as to organize its function. They consist of a group of electronic
              elements (resistance, diode, relay, transistor …). The good quality of these circuits
              is attached with its ability to control more than one function at the same time, and
              in its preciseness in carrying out future and sent orders.

             Study of demand:
              The demand for the products of the project arises by a large class of consumers,
              because they have entered to all fields: houses, cars, service facilities, industrial
              plants, warning devices, monitoring cameras, industrial machines, lightening
              devices.… The annual demand for these controllers is estimated at 4,000,000
              pieces.

             Study of supply:
              The supply of these products in the Syrian market is limited to certain applications
              of micro programming, where most imported ready products do not observe the
              special state of the use of the product. The supply of micro controllers is estimated
              at 500,000 pieces. Importers frequently meet the need of the local demand by
              importing from China, Japan, Korea,…). Yet, some factories and establishment
              need certain designs of special circuits.
                                                    106
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




             Gap between demand and supply:
              By studying the gap between the supply
              and demand, we find that there is a clear
              gap in favor of the demand, and the supply
              of these products is too low, because most
              consumers depend on many circuits to
              meet their needs, and because of the
              absence of promotion for these products. In
              general, the gap and the need for controllers are estimated at 3,500,000 pieces.

             Competition & competitors:
              By studying the local market and the products of the competitors, we find that there
              are some technical centers which limitedly manufacture this software, in addition to
              the Chinese products which perform similar purposes, but they cannot be
              considered a strong competitor, because they do not meet all the needs of the Syrian
              markets.

             Strategies of sale and distribution:
              The field study has pointed at the most important channels of marketing in the
              project area and the southern and northern areas. They are: engineering offices,
              workshops of repairing cars, building entrepreneurs, small factories and workshops,
              centers of distributing electric and electronic equipments. On the other hand, the
              participation in exhibition and letting people know the products of the project and
              their characteristics through promotional advertisements help increase the volume
              of sales.

           SWOT:
          a. Opportunities and points of strength:
          - The increasing demand for the products of the project.
          - The availability of employment from the graduates of
             institutes and professional secondary schools.
          - The possibility of producing non-typical controllers.
          b. Threats and points of weakness :
          - The project needs large allocations for advertisements and
             letting people know its products.
          - The prices of raw materials are linked with the
             fluctuations of the prices of foreign currencies.
          - The entrance of some competitive products to the products of the project.



                                                    107
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




             Revenues of project:
              The annual revenues of the project are estimated at 380,000,000, resulting from
              selling and installing 20,000 large control circuits per year, where the average price
              of a circuit is SYP 12,000; and the second revenue comes from selling 20,000 small
              circuits per year, the average price of a circuit is SYP 7,000.

          Second: Technical Study:
           Technical description of project:
          a. Location: The project will be established in Lattakia governorate, where the
             demand for the products is high, in addition to the little number of programming
             centers in the area, and there are a possibility for the exportation to the Arab
             countries (Lebanon, Jordan, Iraq, …).

          b. Land and Building: (SYP 90,000,000)
             The building will be constructed on a piece of land of 2.5 dunams (2500 m2) at a
             value of SYP 5,000,000. The building will comprise the administrative section and
             the production section which contains the equipment and the instruments of
             production and an insulated storehouse for the raw material and the final products,
             in order not to be affected by the external humidity, in addition to the quality test
             center and the public utilities at an estimated cost of SYP 85,000,000.

          c. Equipment of project and production process: (SYP 65,000,000 of a European
             origin).
             The production department consists of computers specialized in designing,
             manufacturing and electronic testing, in addition to oscilloscopes, testing devices,
             volt-ampere-hour meters, ammeters, a machine for manufacturing plastic structures,
             in addition to tools and other instruments.

          d. Means of transportation (SYP 4,500,000): a forklift, a microbus for transporting
             workers.
          e. Furniture and furnishing: (SYP 1,500,000):
          - Office equipment for the administrative offices, computers, uninterruptible power
             supplies (UPS's), electric equipments and furniture for the production department.

          f. Expenses of incorporation and licenses (SYP 14,000,000):
          - Expenses of engineering, civil and architectural studies, expenses of a feasibility
             study, administrative expenses, license charges, franchise and investing patents, in
             addition to the campaigns of letting people know the project and its products.




                                                    108
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          g. Commodity requirements: (SYP 260,000,000).
          - Raw materials: Electronic and electric spare parts (converters, photic cells,
             electronic elements and integrated circuits (IC's) at a value of SYP 245,000,000.
          - Requirements of packing SYP 15,000,000>

          h.   Service requirements: SYP 25,000,000.
          -    Expenses of maintenance: SYP 3,000,000.
          -    Communications, telegrams, … : SYP 1,000,000.
          -    Promotion, advertisement, participation in exhibitions: SYP 20,000,000.
          -    Other service expenses: SYP 1,000,000.

          i. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:
             - Production and purchases department: It supervises production, studies and
               purchases raw materials, examines the final product and supervises the process
               of installation.
             - Administrative and financial department: It follows up the administrative issues,
               correspondence, archive, organizing contracts, following up the revenues and the
               expenses of the project.
             - Marketing and sales department: It is responsible for monitoring and studying
               the motion of the markets, searching for new markets for promoting the products
               of the project, supervising the processes of sales and distribution.

               The employment needed for the project is estimated at 90 workers with one shift,
               distributed to 70 technicians and 20 administrative officials. The total cost of
               salaries and wages, including social insurances, is estimated at SYP 30,000,000.

          Third: Financial Study:
           Estimation of investment costs:
           - Fixed capital: SYP 175,000,000.
           - Working capital: SYP 50,000,000.

              Estimation of annual operating costs:
          -    Commodity requirements (supplies): SYP 260,000,000.
          -    Service requirements: SYP 25,000,000.
          -    Wages and employment: SYP 30,000,000.
          -    Depreciations: SYP: 14,750,000.
               Variable costs are estimated at SYP 292,000,000 and fixed costs are estimated at
               SYP 37,750,000.



                                                    109
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




             Economic and financial analysis of project:
          -   Total investment costs = SYP 225,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              477,959,916.
          -   Total annual costs (the average lifetime of the project is 10 years) = SYP
              388,328,328.
              Notice: Revenues are raised 5% during, and costs are raised 4% during the
              production lifetime of the project (10 years).

              Economic parameters of project:
              a. Annual gross profits                          = SYP 104,381,588.
              b. Net profits                                  = SYP 89,631,588.
              c. Pay-back period                              = 2.2 years
              d. Rate of return of capital (investment)       = 46%
              e. Net present value at a discount rate of 15% = SYP 214,157,099.
              f. Break-even point                             = 30%
              g. Internal rate of return                     = 35.6%
              h. Added value                                 = SYP 120,000,000.
               The project is largely sensitive towards the fall of its revenues 10%, where the
               internal rate of return becomes 16.8 %.

             Most important required permits:
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Industrial decision / Ministry of Industry.
          -   Approving the engineering charts from the Association of Engineers.
          -   Administrative permit / Lattakia Governorate – Technical Services
          -   Ecological consent / Lattakia Governorate – Directorate of Environment




                                                   110
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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




                               A Summary of a Feasibility Study
                           A Factory of (Wireless receivers "interphone')
                                     In Lattakia Governorate

          About the project:
           The project consists of an integral line for producing
           wireless receivers “interphone” fitting the public taste. The
           project is situated in Lattakia governorate. It corresponds
           with the tissue of the governorate and it does not affect the
           tourist situation, because it is extremely eco-friendly. 20%
           of its production will be exported outside the country.
           This project is considered necessary because of the increase
           in the number of residential complexes, companies and
           large marketing compounds, since the internal
           communication became an important part for work.

          First: Marketing Study:
            Product & quality:
             The project will offer high quality products of reception sets
             and interphones used in large marketing compounds, large
             companies houses and residential units.
             Internal connection has become an essential part of daily life.
             It is used for controlling the building and creating a
             communication system among the rooms.

            Study of the demand
             In general, these systems are linked with residential and non-residential buildings.
             Therefore, the study of the demand will be done according to the development of
             construction and building. About 106.7 thousand residential and non-residential units
             have been licensed in Syria. On the other hand, the rate of the demographical growth
             reached 2.4%, where the population of Syria approximately reached 21 million
             inhabitants.
             Moreover, the trends of the individuals developed in the field of inserting internal
             communications technologies to the houses, companies, offices and marketing
             centers because of their great importance. Consequently, the annual demand is
             expected to develop 3%.

            Study of supply:
             Syria imports 100% of its need to the internal communication systems from many
             countries. It is not locally produced.

            Gap between the demand and the supply:
             The opportunity and the market share are ready for this product because of the
             inexistence of a similar local product. Consequently, it is easy to enter the market,


                                                     111
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




             especially if the product is competitive to the imported product in terms of quality
             and price.
            Competition & competitors:
             Neither in the area of the project nor in Syria are there similar factories.

             strategies of sale and distribution:
             - 80% of the product will be locally marketed in the internal markets.
             - 20% will be exported to the regional and international markets in order to realize
                 an income of foreign currency.

          SWOT:
         a. Opportunities and points of strength:
            - There are no constraints related to providing the required raw materials for
              assembling.
            - The increasing demand which accompany the development of new methods in
              building and developing the centers and commercial companies, in addition to the
              development of modern technology of communications inside the constructions.
            - The absence of internal competition.
            - The joining of Syria to the Free Arab Trade Organization and the preparations for
              joining the International Trade Organization open new prospects of exportation.

         b. Threats and points of weakness:
            - The competition of the foreign products, which is experienced in this industry.
            - Although we witness a technical development, it is still underdeveloped.

            Revenues of the project:
          Marketing               Product               Qty    Unity      Price                           Total/SYP
           Locally      Integrated interphone system   4,800   System   SYP 35,000                     SYP 168,000,000
          Exportation   Integrated interphone system   1,200   System     & 800                         SYP 44,160,000
                                              Total                                                    SYP 212,160,000

        Second: Technical Study:
          Technical description of the project:
         a. Location: Lattakia
         b. Land & Building: (SYP 29,900,000)
            The factory will be built on a piece of land of no less than 7,000 m2 fit to the need of
            the project, at a value of SYR 7,000,000.
            The building is designed according to an internal chart fit to the requirements of the
            production process and the conditions of controlling quality of the process of
            production and storing, at a value of SYR 22,900,000.

         c. Machinery and equipment: (SYP 160,040,000 of west- European origin)
            - Section of receiving parts.

                                                       112
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




              -   Section of assembling and installation.
              -   Section of final preparations.
              -   system of packaging.
              -   system of monitoring.

         d.  Means of transportation (SYP 4,800,000).
         e.  Furniture and furnishing: (SYR 750,000).
         f.  Expenses of incorporation (SYP 8,200,000).
         g.  Commodity requirements: (SYP 124,875,000).
            - Raw materials: Main electronic parts, electronic circuits required for assembling.
               They are estimated at (SYP 109,677,000).
            - Other commodity requirements (electricity, water, fuel): SYP 15,198,000.
         h. Service requirements: SYP 7,047,000.

         i. The organizational structure, salaries and wages:
            The organizational structure of the project consists of:
                 - Production department: It is responsible for all stages of the production
                   process, in addition to the laboratory and controlling quality.
                 - Promotion and sales department: It is responsible for drawing up the
                   advertisement and promotional polices as well as supervising the processes of
                   distribution and selling inside the different halls.
                 - Human resources and finance department: It comprises the financial
                   directorate, personal affairs directorate, drivers and workers.
            The employment needed for the project is estimated at 48 workers with one shift,
            distributed to 4 administrative officials, 30 experts, technicians, specialized workers,
            14 non-specialized provisional workers. The total cost of salaries and wages,
            including social insurances, is estimated at SYP 15,360,000.

         Third : Financial Study:
             Investment costs are estimated as follows:
             - Fixed capital: SYP 203,690,000.
             - Working capital: SYP 41,776,000.

          Annual operating costs are estimated as follows:
          - Commodity requirements: SYP 124,875,000.
          - Service requirements: SYP 7,047,000.
          - Wages and employment: SYP 15,360,000.
          - Depreciations: SYP: 19,899,000.
            Variable costs are estimated at SYP 136,656,000, and fixed costs are estimated at
            SYP 30,524,400.



                                                      113
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




             Economic and financial analysis of the project:
             - Total investment costs = SYP 245,466,000
             - Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
                266,852,568
             - Total annual costs (the average lifetime of the project is 10 years) = 202,409,603.
              Notice: Revenues are raised 5% and costs are raised 5% during the production
              lifetime of the project.

              Economic parameters of the project:
                 a. Annual gross profits                              = SYP 84,341,965
                 b. Net profits                                      = SYP 64,442,965
                 c. Pay-back period                                  = 2.9 years
                 d. Rate of return of capital (investment)            = 34 %
                 e. Net present value at a discount rate of 15%       = SYP 132,379,406
                 f. Break-even point                                  = 32%
                 g. Internal rate of return                          = 28.4%
                 h. Added value                                      = SYP 87,285,000.
               The project is largely sensitive towards the decrease of revenues at a rate of 10%,
               where the internal rate of return decreases to 17.4%.

              Most important required permits:
               - Licensing under law No. /8/ Syrian Investment Agency.
               - Industrial permit / Ministry of Industry.
               - Administrative permit (Lattakia Governorate – Technical services).
               - Ecological consent.
               - Approving the engineering charts from the Syndicate of Engineers.




                                                     114
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                                   A Feasibility Study Summary of
                   A Factory of Producing Furniture for Private Educational
                                 Institutions (schools & Universities)
                 Damascus Countryside Governorate / Adra Industrial City /

          About the project:
           The project is listed under the projects of
           engineering industry whose aim is to produce
           furniture for the educational institutions (schools
           and universities). The industry of furniture is
           considered one of the significant means for
           completing the educational system. The
           importance of this project arises from the
           development of the number private schools and
           universities, which reflects the extent of the need
           for products for such kind of projects.

              The project aims to produce typical sorts of educational and office furniture which
              meets the requirements of various modern educational and administrative
              institutions. The project will be built in the industrial city of Damascus rural area in
              Adra.

              The summary of the feasibility study includes: marketing study, technical study and
              financial study.

          First: Marketing Study
              Product & quality:
               The project produces different forms of wood furniture for the educational
               institutions such as desks, chairs, wardrobes, bookcases, office racks, and different
               sizes of tables for private kindergartens, schools, institutes and universities with
               typical scientific and technological designs. It also pays attention to the aesthetic
               technical appearance together with the function of the product.

              Study of the demand
               The demand for wood furniture for the private
               educational institutions arises from the private
               kindergartens which count 1,115. and 1,761, basic
               education and secondary schools, and from 11
               private universities. The developed school and
               academic furniture of the project participate in
               furnishing the private educational buildings.
               Therefore, the ducts of marketing are limited to the
               contracting with educational institutions such as universities, institutes and
               bookshops. On the other hand, the opportunity of marketing could be found through
                                                    115
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




               local specialized exhibitions in this field. The following table shows the number of
               students and pupils in the private education institutions for the two years (2008 and
               2009) as issued by the Central Bureau of Statistics:

              Year Kindergartens 1st stage        2nd stage    Secondary University Total
              2008    147935      70661            45229         18714       0      282539
              2009    145416      50755            49747         17240    25849     289007

              Study of supply:
               The rate of population for those who are in the school age is 46% of the total
               number of population, where the total number of students in all educational stages
               amounts to 6,208,627 students.

              Gap between the demand and the supply:
               The trend for private education is increasing in all stages. And the constructions of
               private education depend on the modern designs of furnishing which are fit to the
               educational process. At present, they mostly depend on importing these products
               from China, Turkey and Europe. However, the project tends to produce and locally
               market the required furniture according to the latest designs which get in line with
               the needs of these institutions. This will generate reasonable profits to the project.

             Competition & competitors:
              Producers of such furniture are mostly small handcraft
              workshops depending on the traditional methods prevailing
              all over the country. As for the most important pioneering
              companies in producing modern school furniture, they are:
                - The Saudi Syrian Furniture Company (Damascus).
                - Sihr Al-Sharq Company for Furniture (Damascus)
                - Gallery Modern Company (Aleppo).
                - Golden Line Company (Damascus)
          Most of these companies tend to produce office and household furniture. They are not
          specialized in school furniture. This makes the opportunity wide in making the project
          able to market its products through the specialty and good quality of the product.

              Strategies of sale and distribution:
               - Local markets: (Damascus, Damascus countryside, Aleppo, Homs) where 67%
                 of the private educational institutions exist. The project will launch its products
                 through permanent and seasonal exhibitions in order to let others know these
                 products, especially in the center of cities and large areas.
               - Regional markets: The intention now tends to limited exportation to the
                 neighboring countries such as Iraq and Lebanon.




                                                     116
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




              SWOT:
              a. Opportunities and points of strength:
               - The availability of raw materials such as wood, metal and accessories at
                  reasonable prices.
               - The dependence of new innovated modern designs and the rise of the
                  coefficient of safety in the design which leads to the increase of durability and
                  long life.
               - The existence of skilled experienced craftsmen who can be depended upon in
                  developing and diversifying products.

              b. Threats and points of weakness:
               - The competition of foreign brands in the local market.
               - No more private university is permitted.

             Revenues of the project:
              The annual revenues of the project for producing 70,000 pieces of school desks,
              chairs, wardrobes, office shelves and tables of different sizes are estimated at s.p.
              102,000,000.

          Second: Technical Study:
             Technical description of the project:

              a. Location: It is in Adra Industrial City in Damascus rural area, which enjoys
                 many advantages and special facilities related to the conditions of industry and
                 the investment projects, in addition to the easy and fast procedures of giving
                 permits.

              b. Land and building (s.p. 31,000,000)
                 The factory will be built on a piece of land of no less than 6 donums (a measure
                 of land, 1000sq.m.) rounded with walls of no less than 5 meters high, supported
                 by reinforced concrete basis for fixing the equipment. The site was chosen in a
                 way that realizes the conditions of natural ventilation away from the residential
                 gatherings. It is provided with the service requirements of electricity, and the
                 sources of water and power and fire-fighting devices. The value of the land is
                 s.p. 12,000,000, and the value of the building is s.p. 19,000,000.

              c. Machines and equipment: (s.p.520,000,000 of Turkish or Italian origin)
                 The production process is summarized in the primary planning and defining the
                 dimensions followed by cutting the raw materials and manufacturing the
                 connecting parts till we reach the stage of assembling and making final touches.
                 The project consists of a group of machines and instruments:
                  - Vacuum press for the P.V.C. with it supplementary tools, and a press for
                     pressing the M.D.F


                                                    117
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Investment Opportunities Guide
                                                                                                                Beat Al khebrah
                                                                                                                              Syria 2011
                                                                                                       Consulting & Studies of Economic
                                                                                 




                         -   Sherion, band saw, trimmer, formica roller, saw of aluminum, and other
                             special tools.
                         -   Trimmer of aluminum, rail trimmer, peel cutter, sticking letters machine,
                             cylinder of formica
                         -   C.N.C machine, profile cutter, profile drill, hydraulic saw.
                         -   Machine for rolling aluminum,
                             machine for cutting iron, and other
                             needed instruments

                  d.     Means of transportation (s.p. 4,500,000)
                  e.     Furniture: (s,p 1,500,000).
                  f.     Expenses of incorporation and permits (s.p 2,500,000).
                  g.     Commodity requirements: (s.p 65,000,000).
                       - Raw materials (wood, iron, accessories): s.p. 55,200,000
                       - Other commodity requirements (electricity, water, fuel): s.p 9,800,000.

                  h. Service requirements: (maintenance, mail, telephone, advertisement, …):
                     s.p. (2,500,000)

                  i. The organizational structure, salaries and wages:
                  - Production department: It is responsible for all
                      stages of production.
                  - Promotion and sales department: It is responsible
                      for putting the advertisement and promotion
                      policies, in addition to the processes of
                      distribution and sales within the showrooms or
                      the direct supply to the clients.
                  - Finance and human resources affairs:
                   The project is in need of 40 employees with one shift: four administrative officials
                   and 36 technical, production, maintenance and guard employees. The cost of
                   salaries and wages is estimated at s.p. 8,500,000, including the social insurance.

          Third: Financial Study:
               Investment costs are estimated as follows:
              - Fixed capital    : s.p 92,000,000.
              - Working capital : s.p 18,000,000.

                 Annual operating costs are estimated as follows:
              -    Commodity requirements : s.p. 65,000,000
              -    Service requirements     : s.p. 2,500,000
              -    Wages and employment : s.p. 8,500,000
              -    Depreciations             : s.p. 7,950,000

                                                           118
                                                                                                              
Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




          Variable costs are estimated at s.p. 70,000,000, and fixed costs are estimated at s.p.
          13,050,000.

             Economic and financial analysis of the project:
             - Total investment costs = s.p 110,000,000.
             - Value of annual revenues = (the average lifetime of the project is 10 years) = s.p
               128,294,000
             - Total annual costs (the average lifetime of the project is 10 years) = s.p.
               102,227,000

          Notice: Revenues and costs are raised 5% during the production lifetime.

                    Economic parameters of the project:
                      a. Total annual profits                            = s.p 34,017,,000
                      b. Net profits                                     = s.p 26,067,000
                      c. Pay-back period                                 = 3.5 years
                      d. Rate of return of capital (investment)          = 31%
                      e. Net present value at a discount rate of 15%    = s.p (43,638,184)
                      f. Break-even point                                = 33% i.e. (s.p. 42,377,000)
                      g. Internal rate of return                         = 25%
                      h. The added value of the project:                 = s.p. 38.800,000

          The project has a large sensitivity toward the reduction of its revenues at a rate of 10%,
          where the internal rate of return becomes 12.6%.

                    Most required permits:
                 -    Industrial permit
                 -    Licensing under law No. /8/ Syrian Investment Agency.
                 -    Subscription and allotment
                 -    Building license
                 -    Administrative permit and ecological consent.

          The industrial cities include the service of the one stop shop, which provides all these
          permits




                                                         119
                                                                                                             
Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                              A Summary of a Feasibility Study
             A factory of Producing Ready reinforced concrete, Pre-Cast Concrete
                 Damascus Countryside Governorate / Adra Industrial City /

          About the project:
           This project is listed under the projects of the
           engineering industries. It aims at producing ready
           concrete and pre-cast concrete which serve several
           projects (construction, irrigation, sewage, electric
           networks …).
           The project is necessary under the demographic
           growth and its need to more buildings, services and
           infrastructure and under the approach of the state towards developing these services
           after the issuance of the law of real-estate development. Adra Industrial City was
           chosen for building this project.
           This summary includes: marketing study, technical study, financial study.

        First: Marketing Study:
             Product & quality:
              The project will produce a wide group of ready made concrete such as: irrigating
              pipes, cement pipes, fence pillars, bowers, animal barns, pillars and bases for
              transferring the electric energy, residential and service complexes, walls, fences,
              pillars of bridges cement bricks, mixed cement for paving and maintaining roads, in
              addition to the asphalt of agricultural routs. M.C.O.

             Study of demand:
              The Syrian government allots ten billion Syrian pounds for the projects of
              infrastructure (building roads and asphalting them, installing sewage networks, water
              networks, electricity networks, constructing buildings…, in addition to rehabilitating
              and maintaining the existing projects which need the products of the studied project,
              and which are requested through bids or by the contractors who are awarded tenders.

              There is also the demand of the private sector of the ready concrete in the sector of
              building, especially the ready ones, or those which are used in the agricultural sector,
              especially the pipes of irrigation.

             Study of supply:
              The factories of the public sector produce different kinds of concrete, including the
              studied products. These factories produced nearly 5,175 thousand tons of cement, in
              addition to 3,227 pieces of roof bricks and 42,377 tons of wall bricks in 2009. The
              production of the private sector was limited to 13,583 pieces of roof bricks and
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




               44,750 tons of wall bricks. The other available kinds in the local market are
               imported.

              Gap between demand supply:
               There is a clear growing gap of the cement products in general as mentioned above,
               but it is covered by importation. (Imports of concrete and mortar reached 5,751 tons
               in the end of 2009). Therefore, the project will try to exploit this gap and cover part
               of the local demand for the products of the project provided it is fully carried out.

              Competition & competitors:
               Competition is mainly centered in the factories of the public sector, then in the
               imported cement, in addition to some projects of the private sector, but they are few.
               It is worth mentioning that the local market is open and it is in need of more cement
               products with an opportunity of exporting to the neighboring countries, Iraq in
               particular.

              Strategies of sale and distribution:
              - Local markets: 50% of the product will be distributed in the local markets
                  through contracts with public and private bodies, in addition to the direct sale
                  from the factory.
              - Regional markets: 50% of the product through representatives in the importing
                  countries (Iraq, Lebanon, Jordan…).

              SWOT:
             a. Opportunities and points of strength:
              - The availability of good quality raw materials.
              - The interest of the government in the projects of the infrastructure and the large
                 constructional projects (law of real-estate development).
              - The permanent growing demand for the various products of the project which
                 serves more than one sector.

         b. Threats and points of weakness:
           - The competition of the existing products in the local market.
           - The large weights and sizes of the products and the expenses of transporting them.
           - The government is not committed to securing the basic raw materials (cement).

              Revenues of project:
               The annual revenues of the project are estimated at SYP 130,000,000 out of selling:
               - Uncovered irrigation pipes (2000 longitudinal meter).
               - Circular irrigation pipes (2000 longitudinal meter).
               - Distributors of irrigation pipes (40 ones).
                                                       121
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




             -   Ordinary cement sewers of diameters 20 – 100 cm (3000 meters).
             -   Cement sewers of diameters 50 – 100 cm (3000 meters).
             -   Pillars and bases of conducting electric energy (5000 ones).
             -   Several buildings (10000 meters).
             -   Animal sheds, poultry houses, rooms of vehicles.
             -   Other products as requested.

          Second: Technical Study:
          Technical description of project:
          a. Location: The project will be built in Adra Industrial
             City in Damascus countryside for being close to main
             markets of selling, in addition to the investment
             advantages presented by the industrial cities to the
             investors.

         b. Land and Building: (SYP 30,000,000)
            The project needs a piece of land of no less than 5000 m2 at a value of SYP
            10,000,000. The building will be designed according to a simple internal chart fit to
            the requirements of the production process at an estimated cost of SYP 20,000,000.

         c. Machinery and equipment: (SYP 126,000,000 of a west-European origin).
            The project comprises the following:
            - A central place for mixing materials with its supplementary materials.
            - A machine for manufacturing pipes and pillars.
            -    A hydraulic vibrating press.
            - A machine for manufacturing tiles, pre-made jambs.
            - Drying section.
            - A cutter of reinforcing and cutting moulds.
            - Curving machines.
            - A pump of concrete
            - A unit of crushing stones and gravel.
            - Mobile laboratory for testing concrete.

         d. Means of transportation (SYP 21,000,000 )
           - A truck loading 15 tons, tankers 48 tons, mobile mixers, dumper truck 20 tons, a
             tanker for transporting cement.

         e. Furniture: (SYP 500,000).
         f. Expenses of incorporation (SYP 2,500,000).
         g. Commodity requirements: (SYP 74,000,000).

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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




              - Raw materials: (white cement, round iron, black cement, gravel, sand, spare parts,
                various materials, packing and packaging machines): SYP 42,700,000.
            - Other commodity requirements (electricity, water, fuel): SYP 31,300,000
         h. Service requirements: ((maintenance, mail, telephone, advertisement,
             promotion,…): SYP 3,000,000.

         i. Administrative and organizational structure:
            The administrative and organizational structure of the project consists of:
             - Production department: It is responsible for all stages of the production process.
             - Promotion and sales department: It is responsible for drawing up the
                 advertisement and promotional polices as well as supervising the processes of
                 purchasing raw materials and sales.
             - Human resources and finance department: It comprises the financial directorate,
                 personal affairs directorate, drivers and workers.
             - Laboratory: For making sure of the quality of the products and their
                 compatibility with the standard specifications.
            The employment needed for the project is estimated at 54 workers with one shift,
            distributed to 9 administrative officials, 45 technicians, production, and maintenance
            workers. The total cost of salaries and wages, including social insurances, is
            estimated at SYP 9,700,000.

          Third: Financial Study:
             Estimation of investment costs:
             - Fixed capital: SYP 180,000,000
             - Working capital: SYP 15,000,000.

              Estimation of annual operating costs:
             - Commodity requirements (supplies): SYP 74,000,000.
             - Service requirements: SYP 3,000,000.
             - Wages and employment: SYP 9,700,000
             - Depreciations: SYP 18,400,000
              Variable costs are estimated at SYP 80,280,000, and fixed costs are estimated at SYP
              24,820,000.

             Economic and financial analysis of project:
             - Total investment costs = SYP 195,000,000.
             - Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
               163,512,000
             - Total annual costs (the average lifetime of the project is 10 years) = SYP
               125,795,000.


                                                     123
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




             Notice: Revenues and costs are raised 5% during the production lifetime of the
             project.

            Economic parameters of project:
               a. Annual gross profits                        = SYP 56,117,000
               b. Net profits                                 = SYP 37,717,000
               c. Pay-back period                             = 3.5 years
               d. Rate of return of capital (investment)       = 29%
               e. Net present value at a discount rate of 15% = SYP 60,685,193
               f. Break-even point                             =40 % = SYP 65,404,800
               g. Internal rate of return                      = 23%
               h. Added value                                  = SYP 56,000,000.
             The project is largely sensitive towards the rise of its revenues 20%, where the
             internal rate of return decreases to 3.2%.

            Most important required permits:
              - Industrial permit / Ministry of Industry
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allotment.
              - A building license.
              - Administrative permit and Ecological consent
             The industrial cities include the service of the one stop shop, which provides all these
             permits.




                                                     124
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                           A Summary of a Feasibility Study
                                Producing Wall Tanks
                Damascus Countryside Governorate / Adra Industrial City /

           About the project:
            The project is classified under the engineering
            industries. It aims at producing pre-made wall
            tanks made of fiberglass.
            The project will meet the need of houses,
            residential complexes, service and industrial
            projects and agricultural lands for keeping
            water and other liquids. There is only one
            factory producing similar projects. It is suggested to be built in Adra Industrial
            City. It will operate at an annual production capacity of 150,000 m2 of fiberglass
            boards.

              This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
             Product & quality:
              The project will produce fiberglass sheets measuring 1 m X 0.5 m, 1 m X 1 m, 1m
              X 1.5 m, 1m X 2 m. then they will be assembled to form tanks of different sizes as
              required. These tanks are use for storing water, chemicals and liquid petroleum
              products. The product is characterized by its high durability and its light weight. It
              is easy to clean. It resists the weather effects. It is stainless. Its cost is low in
              comparison with the metal tanks.

             Study of demand:
              The demand for these products arises from residential buildings, farms, restaurants,
              service products and oil companies…. The annual demand is estimated at 100,000
              tanks. People either, use more than one tank to get the larger required storing
              capacity or build cement tanks. Sometimes, they buy larger metal tanks which are
              costly and have many problems.

             Study of supply:
              The field studies of the local markets showed that the idea of the project is new.
              There are only small factories and workshops with a limited storing capacity. They
              manufacture iron, plastic or fiberglass tanks of small sizes on demand. That is to
              say, they do not meet the need of the establishments that need tanks with high
              capacities.

             Gap between demand and supply:
              There is a clear gap in favor of the demand, and the supply of this product is very
              low, because these tanks are not manufactured locally, where little quantities are
              imported from Korea and Taiwan.
                                                    125
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




              Competition & competitors:
               With regard to the large wall tanks which are needed in the factories, farms and
               residential units, we find that the local competition is restricted to a few workshops
               that manufacture large iron tanks. They are very little in comparison with the
               demand.

             Strategies of sale and distribution:
            - Local markets: 90%. The field studies indicated that best kind for the promotion
               to these products is to distribute brochures to the owners of the existing
               establishments or the buildings which will be newly constructed, and participate
               in the internal and external exhibitions, in addition to holding symposiums to let
               people know about the product, its quality and its characteristics.
           - Regional markets: 10% will be exported to the neighboring countries like Iraq,
               Lebanon and Jordan.

              SWOT:
              a. Opportunities and points of strength:
               - The existence of a high demand for the product in the project area and the other
                  governorates.
               - The absence of competition to the products of the project.
               - The possibility of forming the tank according to the requested size and quantity.

              b. Threats and points of weakness:
                - The cost of the campaign of advertisement and promotion for making the
                   products famous.
                - The link of the price of raw materials with the world price of oil.

              Revenues of project:
               The annual revenues of the project are estimated
               at 765,000,000 out of selling and installing 4,500
               tanks per year. The average price of a tank is
               SYP 170,000 for the size of 12,000 liters.

          Second: Technical Study:
              Technical description of project:
              a. Location: The project will be set up in the industrial
                 city in Adra, Damascus Rural Area, where there are a
                 large number of establishments, farms, villas,
                 hospitals, restaurants and lands which need high
                 storing capacity of water due to the depletion of wells
                 water in Damascus and its countryside.


                                                     126
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




             b. Land and Building: (SYP 89,000,000).
                The project will be constructed on a piece of land of 2 dunams (2,000 m2), at a
                value of SYP 4,000,000. The building will comprise the administrative
                department, and the production department which contains the line of producing
                fiberglass, storehouses for storing raw materials and final products, a center for
                testing quality and public services. Its cost is estimated at SYP 75,000,000, in
                addition to the infrastructure (sewage and electricity network).
            c.   Machinery and equipment: ( SYP100,000,000 of a west European origin ):
                 The production line consists of:
                 - Three hydraulic compressors.
                 - Moulds with different sizes for manufacturing fiberglass sheets (8 mm
                     thick). They participate in assembling and installing tanks, in addition to the
                     line of accessories and rods of galvanized iron. The process of assembling is
                     done in the project where it will be carried out.
             d. Means of transportation (SYP6,500,00): trucks for transporting raw materials
                and final products, a service car and a forklift.
            e. Furniture and furnishing: (SYP 1,500,000).
            f. Expenses of incorporation and licenses (SYP 8,000,000).
            g. Commodity requirements: (SYP 630,000,000).
              - Raw materials: (1600 + 30 waste and discharge) fiberglass and resin X SYP
                300,000 = SYP 489,000,000.
                Accessories are estimated at a quarter of the cost of one sq. meter, i.e. SYP
                123,000,000.
              - Fuel and other utilities (industrial electricity,
                industrial fuel): SYP 18,000,000.
            h. Service requirements: (maintenance, mail,
               telephone, advertisement, promotion,…): SYP
               10,000,000.

             i. Administrative structure:
                - Administrative and financial affairs department: It follows up the
                  administrative issues, correspondence, archive, organizing contracts and
                  expenses of the project.
                - Purchases and production department: It supervises the production process,
                  tests the final product and supervises the process of installation.
                - Marketing and sales department: It observes the motion of the market and
                  looks for new markets for promoting the products of the project and
                  supervises sales and distribution.

              The employment needed for the project is estimated at 80 workers with one shift,
              distributed to 60 technicians and 20 administrative officials. The total cost of
              salaries and wages, including social insurances, is estimated at SYP 19,000,000.
                                                    127
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          Third: Financial Study:
           Estimation of investment costs:
           - Fixed capital : SYP 195,000,000.
           - Working capital: SYP 85,000,000.
             Estimation of annual operating costs:
             - Commodity requirements (supplies) : SYP 630,000,000.
             - Service requirements               : SYP 10,000,000.
             - Wages and employment              : SYP 19,000,000.
             - Depreciations                     : SYP: 16,950,000.

          Variable costs are estimated at SYP 645,600,000 and fixed costs are estimated at SYP
          30,350,000.
             Economic and financial analysis of project:
             - Total investment costs = SYP 280,000,000.
             - Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
               876,987,000.
             - Total annual costs (the average lifetime of the project is 10 years) =
               SYP770,458,000.

          Notice: Revenues and costs are raised 3% during the production lifetime of the project.
              Economic parameters of project:
                a. Annual gross profits                         = SYP 123,479,000.
                b. Net profits                                  = SYP 106,529,000.
                c. Pay-back period                              = 2.3years
                d. Rate of return of capital (investment)       = 44%
                e. Net present value at a discount rate of 15% = SYP 275,838,177
                f. Break-even point                              =22 % = SYP 192,937,000.
                g. Internal rate of return                       =39.3 %
                h. Added value                                   = SYP 135,000,000.

          The project is largely sensitive towards the fall of its revenues 10%, where the internal
          rate of return decreases to 4.4%.

              Most important required permits:
              - Industrial permit / Ministry of Industry.
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allotment.
              - Building license.
              - Administrative permit and ecological consent.

          The industrial cities include the service of the one stop shop, which provides all these
          permits.
                                                     128
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                           A Summary of a Feasibility Study
                       A Factory of Producing Electric Elevators
                Damascus Countryside Governorate / Adra Industrial City /

           About the project:
            The project is categorized under the electric
            industries. It aims at producing electric elevators of
            different loads (for persons and goods). The
            importance of this project is aggravating and its
            prospective profits will increase due to the vertical
            constructional development in Syria.
              This summary includes: marketing               study,
              technical study, financial study.

          First: Marketing Study:
             Product & quality:
              The Syrian production of electric elevators and conveying belts is described as
              being inconsiderable, where the process of production is limited to importing the
              parts of the elevator from different sources (Turkey and China), and then they are
              assembled and sold as a final local product. The Syrian standard and technical
              specifications to be available are identified in accordance with the field of use, the
              materials from which they are made, their loads, the speed of the engine, the
              durability and diameter of the cables, the applied electronic control system..etc.

             Study of demand:
              The demand for electric elevators arises as a result of the vertical constructional
              expansion, which is usually linked with the increase of the population and the
              limitedness of open areas in the city centers, in addition to providing the new and
              old buildings with electric elevators (commercial centers and hospitals …).
              The building licenses given in 2009 nearly counted 52,428 versus 46,268 licenses
              in 2008 at a growth rate of 13%, which increases the demand for all kinds of
              elevators.

             Study of supply
              The production of the Syrian market of
              electric elevators nearly counts 13824
              ones. They comprise persons and goods
              elevators. They represent a very little rate
              of the Syrian need on the household and
              industrial level.




                                                    129
                                                                                                             
Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                 Gap between demand supply:
                  The gap between the supply and the demand for the electric elevators appears
                  through the imported quantities which counted 1,658 elevators at a value of SYP
                  359,862 thousand pounds and 2,983 tons of spare parts at a value of SYP 217,854

                 Competition & competitors:
                  The licensed companies of producing electric elevators counted 12 workshops and
                  companies. Five of them are licensed in Damascus Rural area at an annual
                  production capacity of 13,824 elevators of different loads. The most important
                  companies with regard to the production capacity are:
              -   Al-Nouri at a production capacity of 6,000 elevators.
              -   Al-Shalit at a production capacity of 3,000 elevators.
              -   Yousefian at a production capacity of 1,200.
                  In addition to a group of companies specialized in importing elevators and their
                  spare parts for maintenance from different sources, but they are not considered
                  competitors to the project.

                 Strategies of sale and distribution:
              -   Local markets: In the centers of cities, at a rate of 80% of the production for
                  meeting the compressive demand and blocking the gap between the supply and the
                  demand.
              -   Regional markets: (Gulf States, Iraq, Turkey) at a rate of 10% of the production.
                  They are markets for other brands at preset.
              -   International market: (Venezuela, European Union, Russia) at a rate of 10% of
                  the production.

                 SWOT:
          a.      Opportunities and points of strength:
           -       The availability of qualified employment.
           -      The general trend of providing new and old buildings with elevators.
           -      The weakness of competition in the Syrian market with regard to the integrated
                  production.

              b. Threats and points of weakness:
              - The need for a high technical level, especially in the electronic software of the
                 work of elevators.

                 Revenues of project:
                  The annual revenues of the project for producing 450 elevators are estimated at
                  SYP 195,000,000 as follows:


          
              Statistics group 2009 – 2010 – Central Bureau of Statistics.
                                                                130
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




               Description          Produced quantity      Price                             Revenues
               Persons elevators    300                    250,000                           75,000,000
               Goods elevators      150                    400,000                           60,000,000
               Spare parts          -
               total                450                                                      195,000,000

          Second: Technical Study:
           Technical description of project:
          a. Location: Adra Industrial City, because of the existence of a large number of
             industrial plants that require this kind of products, in addition to the other
             investment advantages which are available in the industrial city.

          b. Land: SYP 4,000,000.
             The project will be built on an area of no less than 2 dunams (2000 m2) within the
             industrial city of Adra.
          c. Building: (SYP 30,000,000)
             The building will be constructed on an area of 1,200 m2 according to an internal
             chart fit to the requirements of the production process and the quality control.

          d. Machinery and equipment: (SYP 90,000,000 ).
             The project consists of integrated production lines characterized by flexibility in
             manufacturing elevators according to different specifications (of a European
             origin):
          - The line of producing internal and external cabins
          - The line of producing doors and rails.
          - The line of producing conveying belts.
          - Other equipments.

          e. Means of transportation (SYP 2,500,000)
          f. Furniture and furnishing: (SYP 1,500,000).
          g. Expenses of incorporation and licenses (SYP 2,000,000).
          h. Commodity requirements: (SYP 120,000,000).
          -  Raw materials: sheet iron, steel wires, electronic panels and packaging materials):
             SYP 105,000,000.
          - Other commodity requirements (electricity, water, fuel): SYP 5,000,000.
          i. Service requirements: (maintenance, mail, telephone, advertisement,
             promotion,…): SYP 4,000,000.

          j. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:
          - Production department: It is responsible for all stages of the production process, in
             addition to the laboratory section.


                                                   131
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




          -   Purchases and sales department: It is responsible for drawing up the advertisement
              and promotional polices as well as supervising the processes of distribution and
              sales.
          -   Human resources and finance department: It comprises the financial directorate,
              personal affairs, drivers and workers.
              The employment needed for the project is estimated at 25 workers with one shift,
              distributed to 5 administrative officials, 20 technicians, production, maintenance
              workers and guards. The total cost of salaries and wages, including social
              insurances, is estimated at SYP 7,000,000.

          Third: Financial Study:
             Estimation of investment costs:
          -   Fixed capital: SYP 130,000,000.
          -   Working capital: SYP 50,000,000.

             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP 120,000,000.
          -   Service requirements: SYP 4,000,000.
          -   Wages and employment: SYP 7,000,000.
          -   Depreciations: SYP 11,700,000.
              Variable costs are estimated at SYP 126,000,000 and fixed costs are estimated at
              SYP 16,700,000.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 180,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              223,546,000.
          -   Total annual costs (the average lifetime of the project is 10 years) =SYP
              167,977,000.
              Notice: Revenues are raised 3% and costs are raised 4% during the production
              lifetime of the project.

              Economic parameters of project:
              a. Annual gross profits                              = SYP 67,269,000
              b. Net profits                                       = SYP 55,569,000.
              c. Pay-back period                                  = 2.7years
              d. Rate of return of capital (investment)       = 37%
              e. Net present value at a discount rate of 15% = SYP 133,694,312.
              f. Break-even point                                = 23% = SYP 51,415,000.
              g. Internal rate of return                        = 34.7%
              h. Added value                                     = SYP 75,000,000.


                                                   132
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




              The project is largely sensitive towards the change of its capital, where the internal
              rate of return decreases to 25.3% in case the investment costs increase 30%..

            Most important required permits:
           - Industrial permit / Ministry of Industry.
           - Licensing under law No. /8/ Syrian Investment Agency.
           - Subscription and allocation.
           - Building license.
           - Agricultural permit/ Ministry of Agriculture
           - Administrative permit and ecological consent
          The industrial city includes the service is the one stop shop, which secures all these
          permits.




                                                    133
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                            A Summary of a Feasibility Study
                    Electric Magnetic and Thermal Circuit Breakers
                Damascus Countryside Governorate / Adra Industrial City/

           About the project:
            The project is classified within the electric
            engineering industries. It aims at producing
            electric magnetic and thermal circuit breakers
            with many capacities, according to the
            international specifications of the VDE in the
            industrial city in Damascus rural area. One of
            the justifications for establishing this project is
            the increase of demand for these products for
            the household and the industrial use, in addition to the possibility of exporting these
            products to the neighboring markets, which most often meet their needs by the
            importation from the foreign countries. The project will produce 2,000,000 circuit
            breakers per year.
            This summary includes: marketing study, technical study and financial study.

          First: Marketing Study:
             Product & quality:
              The project will produce thermal and magnetic circuit breakers of different
              capacities: 10, 16, 20, 25, 32, 40, 63 amperes (mono-phase, bi-phase, tri-phase), in
              addition to the differential breakers and thermal manual breakers which are
              characterized by the fast response and the long virtual lifetime. They also protect
              from humidity, and they have high sensitivity towards the electric contact.

             Study of demand:
              The demand for eclectic breakers arises from the entrepreneurs, engineers,
              electricians and maintenance workers. These circuit breakers are installed in
              houses, industrial establishments and service utilities. The demand is estimated at
              7,800,000 breakers, taking into consideration the average consumption of a family
              is 8 breakers. In addition, only a quarter of the families does annual maintenance or
              renews the installations (houses, restaurants, hospitals, factories …).

             Study of supply:
              By studying the supply of the project products, we find that all the existing
              breakers in the market are not locally made. They are imported from other
              countries. I.e. there is no local factory for these kinds of breakers.


                                                    134
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




             Gap between demand supply:
              After studying the demand and supply of the thermal and magnetic breakers, we
              find an explicit gap in the local market, where dependence is fully on the local
              importers for meeting the need of electric breakers.

             Competition & competitors:
              The field study of the market shows that there are competitive brands (Mirlan,
              Muller, Hajar, spanshi, semens and shrak, where the companies supply large
              quantities of their products to the Syrian market. The supplying countries of these
              products are China, Italy, Turkey and Iran …

             Strategies of sale and distribution:
          -   Local markets: 70% of the production for meeting the
              local need, especially houses and factories.
          -   Regional markets: (Iraq, Jordan and Lebanon) at a rate
              of 30%. New methods of promotion will be adopted to
              let people know about the project and its good quality
              and its competitiveness to the supplying companies
              (participation in local and regional exhibitions,
              brochures, gifs that give information about the project, quantitative discounts,
              commercial relations with agents and distribution centers in the governorates.

           SWOT:
          a. Opportunities and points of strength:
          - The increasing demand for the electric breakers in houses and in industry.
          - The ability of competing with supplying companies by launching the product with
             encouraging prices.

          b. Threats and points of weakness:
          - The competition of some European companies to the products of the project in
             terms of quality.
          - The need for a high technical qualified level of employees.

             Revenues of project: SYP 350,000,000.
              The annual revenues of the project out of producing 2,000,000 breakers are
              estimated at 350,000,000 (mono- magnetic thermal breaker, bi-magnetic thermal
              breaker, tri- magnetic thermal breaker, mono-thermal differential breaker and tri-
              thermal differential breaker.




                                                   135
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




          Second: Technical Study:
           Technical description of project:
          a. Location: Adra Industrial City. It is considered one of the industrial cities that
             consume the products of the project, in addition to the merits of investment in it
             and the availability of raw materials.

          b. Land: (SYP 6,000,000).
             The project will be built on a piece of land of 3 dunams (3000 m2). It will comprise
             the administrative and production departments.

          c. Building: (SYP 64,000,000).
             The building comprises of the administrative
             department, in addition to the production department
             which contains the line of producing breakers,
             storehouses for storing raw materials and final
             products, center of examining quality and public
             utilities. The cost is estimated at 55,000,000, in
             addition to the infrastructure, sewage and electricity
             network: SYP 9,000,000.

          d. Machinery and equipment: ( SYP262,000,000 ) = (€ 3,742,000) of a Korean
             origin..
             The project' production line consists of:
          - Line of producing electricity breakers.
          - Unit of developing, testing and packaging.
          - Electricity generator and electricity convertor.
          - Safety and protection instruments.

          e. Means of transportation (SYP 10,000,000):
          - Two trucks, service cars, forklift, bus

          f. Furniture and furnishing: (SYP 1.500, 000).
          - Equipments of administrative offices, computers, electric equipments, furniture to
             the production section.

          g.   Expenses of incorporation and licenses (SYP 7,000,000):
          h.   .Commodity requirements: (SYP 200,000,000).
          -    Raw materials: (fiber, copper, electronic parts, polyethylene… : SYP 165,000,000.
          -    Other commodity requirements (electricity, water, fuel): SYP 35,000,000.
          i.   Service requirements: (maintenance, mail, telephone, advertisement,
               promotion,…): SYP 15,000,000.
                                                   136
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          j. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:
              - Production department: It is responsible for all stages of the production
                  process, in addition to the laboratory section, quality, packing and packaging.
              - Promotion and sales department: It is responsible for drawing up the
                  advertisement and promotional polices as well as supervising the processes of
                  distribution, sales and distribution.
              - Human resources and finance department: It is responsible for supervising the
                  revenues, expenses, correspondence, achieve, personal affairs, wages of staff.
             The employment needed for the project is estimated at 70 workers with one shift,
             distributed to 17 administrative officials, 53 technicians. The total cost of salaries
             and wages, including social insurances, is estimated at SYP 14,000,000.

          Third: Financial Study:
             Estimation of investment costs:
          -   Fixed capital: SYP 350,000,000.
          -   Working capital: SYP 50,000,000.

             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP
              200,000,000.
          -   Service requirements: SYP 15,000,000.
          -   Wages and employment: SYP 14,000,000.
          -   Depreciations: SYP: 33,000,000.
              Variable costs are estimated at SYP 217,600,000 and fixed costs are estimated at
              SYP 44,400,000.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 400,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              440,226,000.
          -   Total annual costs (the average lifetime of the project is 10 years) =SYP
              305,653,000.
              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project.

             Economic parameters of project:
              a. Annual gross profits                        = SYP 167,573,000
              b. Net profits                                 = SYP 134,573,000
              c. Pay-back period                              = 2.4 years
              d. Rate of return of capital (investment)       =42 %
                                                    137
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




              e. Net present value at a discount rate of 15% = SYP 329,718,384
              f. Break-even point                              = 25% = SYP 110,056,500.
              g. Internal rate of return                     = 34.2%
              h. Added value                                 = SYP 50,000,000

              The project is largely sensitive towards the fall of its revenues 10%, where the
              internal rate of return decreases to 24.1% .

             Most important required permits:
          -   Industrial permit / Ministry of Industry.
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Subscription and allocation.
          -   Building license.
          -   Agricultural permit/ Ministry of Agriculture.
          -   Administrative permit & ecological consent.
              The industrial cities include the service of the one stop shop, which provides all
              these permits.




                                                   138
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                                A Summary of a Feasibility Study
                           A Factory of Producing Tin Cans (Conserves)
                                        Dara Governorate
          About the project:
           The project is categorized under the
           engineering industries. It consists of an
           integrated line for producing tin cans and
           conserves with different sizes fit to the
           general demand. Dara (project zone) is
           extremely in need of such kind of products,
           especially after the large expansion in
           planting olive and vegetables, which requires
           more good tin cans for transporting and
           conserving food materials and any other
           mistrials.
           This summary includes: marketing study, technical study and financial study.

          First: Marketing Study:
          Product & quality:
             This project is going to offer a high quality product of tin cans to meet the need of
             many conserved food. They will be fit for all needs, and they will be manufactured
             according to the latest technologies with different sizes and different colors. The
             project will also launch distinguished products which will be the most favored. They
             will be healthy for food, anti-shock, chemically inactive to some extent, where they
             do not interact with the components of the canned product, because they are treated
             in modern ways. The project will offer various products of empty conserves tin cans
             measuring 53/73, 100/73, 850 grams, oil tin can 5 – 16 liters.

            Study of demand:
             There are nearly 32 factories of conserve factories and olive oil mills, in Dara, whose
             annual production exceeds 79,000 tons. This forms a large demand for the metal cans
             reaching, on average, 30 million cans of different measures.

             Study of supply:
             By studying the supply of these products, we find that the existing factories in the
             project zone (conserves, olive oil, …) buy tin cans from other governorates
             (Damascus Rural Area) where there are no factories of this kind of products.

            Gap between demand supply:
             After studying the demand and supply of metal cans in the project zone, we find a
             clear gap in favor of demand estimated at 30 million cans on average.
            Competition & competitors:
             There is no factory in the project area for manufacturing tin cans; i.e. there are no
             competitors to the products of the factory. The whole demand for Dara is directed to
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




             Damascus countryside which has more than a factory such a Sukkar's family
             factories, al-Akram, Al-Boroghli, Saed.

             Strategies of sale and distribution:
             - 80% of the product will be marketed locally, especially in Dara, and its outskirts. .
             - 20% will be exported to Lebanon and Jordan.

          SWOT:
         a. Opportunities and points of strength:
            - The recession of the idea of packing plastic containers and going back to the
               galvanized metal cans.
            - The increasing demand for the product which is
               accompanied with the development of the crops
               and agricultural products.
            - The absence of competition in the project area.
            - The possibility of exportation to the neighboring
               countries.

         b. Threats and points of weakness:
             - The association of the industry with the agricultural products and the amount of
                 production.
             - Raw materials are affected by the international fluctuations of the price of iron
                 plates (sheet metal)

            Revenues of project:
                Description       Size            Qty            Price/SYP                           Total
                Oil cans          16 liters       200,000        X 80                                = 16,000,000
                Oil cans          50 liter        700,000        X 40                                = 28,000,000
                Cans              Medium          5,000,000      X 10                                = 50,000,000
                Cans              Small           8,000,000      X7                                  = 56,000,000

                                                                                        SYP 150,000,000

        Second: Technical Study:
            Technical description of project:
             a. Location: The project will be built in Dara governorate which comprises a large
                number of factories and olive oil mills and conserve factories that need large
                amounts of tin cans.

             b. Land: and Building: (SYP 50,000,000).
                The building will be built on an area of nearly 4,000 m2 at a value of about SYP
                4,000,000. As for the building, it will be designed according to an internal design
                fit to the requirements of the production process and the relevant conditions of
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                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




               quality control of production and storing. Its total cost is approximately SYP
               46,000,000.

            c. Equipments of project and production process: (SYP 90,000,000 of a west
               European origin):
               The production line consists of a group of machines and equipments such as the
               machine of cutting sheet irons, machine of rolling, machine of welding, thermal
               oven, machine of flanging, machine of closing , conveying belts, eccentric, in
               addition to the supplementary tools.

             d. Means of transportation (SYP 8,000,000).
                 -Two trucks for moving raw materials and final products.
                 -A service car.
                 -Two forklifts.
            e. Furniture and furnishing: (SYP 1,500,000).
            f. Expenses of incorporation and licenses (SYP
                5,500,000).
            g. Commodity requirements: (SYP 80,000,000).
               - Raw materials: ready sheet metal needed in the
                   process of lathing and forming tin cans at a value
                   of SYP 60,000,000.
               - Fuel and operating power: (industrial electricity.
                   Industrial fuel, utilities): SYP12,000,000.
               - Requirements of packing and packaging: SYP: 8,000,000.
            h. Service requirements: (maintenance, mail, telephone,                                 advertisement,
                promotion,…):               SYP 22,000,000.

            i. Administrative structure - salaries and wages:
               The administrative and organizational structure of the project consists of:
               - Administrative and financial department: It is responsible for following up
                 administrative issues, correspondence, archive, organizing contracts, auditing
                 the revenues and the expenses of the project.
               - Production and purchase department: It runs the production process by
                 studying the raw materials, purchasing them and testing the final product.
               - Marketing and sales department: It observes and studies the cycle of the market
                 and looks for new markets to promote the products of the project, and it
                 supervises sales and distribution.

               The employment needed for the project is estimated at 50 workers with one shift,
               distributed to 12 administrative officials, 38 technicians and ordinary workers.
               The total cost of salaries and wages, including social insurances, is estimated at
               SYP 11,000,000.


                                                   141
                                                                                                             
Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




          Third: Financial Study:
           Estimation of investment costs:
           - Fixed capital: SYP 155,000,000
           - Working capital: SYP 40,000,000.

                  Estimation of annual operating costs:
              -     Commodity requirements (supplies): SYP 80,000,000.
              -     Service requirements: SYP 22,000,000
              -     Wages and employment: SYP 11,000,000
              -     Depreciations: SYP 14,300,000

                  Variable costs are estimated at SYP 102,000,000,   and fixed costs are estimated at
                  SYP 25,300,000.

               Economic and financial analysis of project:
              - Total investment costs = SYP 195,000,000.
              - Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
                 188,668,388
              - Total annual costs (the average lifetime of the project is 10 years) = 147,762,293.

                  Notice: Revenues are raised 5% and costs are raised 4% during the production
                  lifetime of the project (10 years).

           Economic parameters of project:
            a. Annual gross profits                             = SYP 55,206,095
            b. Net profits                                      = SYP 40,906,095
            c. Pay-back period                                  = 3.5years
            d. Rate of return of capital (investment)           =28%
            e. Net present value at a discount rate of 15%      = SYP 50,302,046
            f. Break-even point                                     =38 %
            g. Internal rate of return                            = 21.4%
            h. Added value                                        = SYP 70,000,000.

                  The project is largely sensitive towards the fall of its revenues 10%, where the
                  internal rate of return becomes 11.2%.

                  Most important required permits:
                  - Licensing under law No. /8/ Syrian Investment Agency.
                  - Industrial permit / Ministry of Industry.
                  - Approving the engineering chart from the Association of Engineers.
                  - Administrative permit / Dara Governorate – Technical Services.
                  - Ecological consent / Dara Governorate – Directorate of Environment.


                                                       142
                                                                                                             
Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                            A Summary of a Feasibility Study
                 Producing Basaltic Wool & Basalt Rods (Iron Alternatives)
                                  Suwaida'a Governorate

          About the project:
           The project is categorized under the heavy metal
           industries. Basalt is a black volcanic rocky
           material composed of the lava of volcanoes. Its
           types are similar in their chemical compound, but
           they are different in the grade of crystallization.
           Basalt is composed of two metals: Pyroxene and
           plagioclase feldspar.
           Basaltic splits are apparent on a wide area south of
           Syria (Suwaisa'a governorate and its nearby area).
           These rocks are used in building, backfilling, and cement industry, as well as in
           embedding roads. The available amounts of basalt are estimated at 6 million m3 in
           Shahba'a, Qraiyah, Rasheedah, Tal Harf and Raha. The studies of the General
           Establishment of Geology have shown that the available type is appropriate for
           producing different kinds of molten materials. This project could benefit from the
           competitive feature which grants it wide selling markets.

             This summary includes: marketing study, technical study, financial kind

        First: Marketing Study:
            Product & quality:
             The project tends to produce reinforced rods which are used in cement buildings.
             These rods are made of basalt and reinforced by long-lasting plastic tapes of
             diameters ranging between 4 - 40 mm, and lengths up to 12 meters with a spiral
             section, taking the hard cubic and round form. They are very solid, four times the
             traditional iron rods. Each one ton of reinforced basaltic rods saves 9.6 tons of the
             iron used for reinforced concrete. In addition, it resists the physical and chemical
             factors.

            Study of demand:
             The demand for reinforced basaltic rods usually arises from the need of the building
             and construction sectors. It is estimated during the eleventh five-year plan, for the
             public and private sector, at 732 residential units, at a rate of 200 thousand residential
             units per year. The participation of the private sector reached 78%, in addition to the
             infrastructure projects such as bridges, subways, tunnels, dams, ports, etc.


                                                      143
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Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




               The annual volume of the local demand for reinforced iron rods is estimated at
               362760 tons.

              Study of supply:
               The local production of traditional reinforced iron rods in 2009 amounted to 49073
               tons as shown in the following table during the period from 2005 – 2009, based on
               the data of the Central Bureau of Statistics:
                          Description       2005      2006    2007     2008    2009
                          Production/ton 67602 70230 68502 54380 49073
                         In 2009, Syria nearly imported 313687 tons from abroad.

              Gap between demand and supply:
               The production of basaltic reinforced rods is considered a new type in the Syrian
               market and in other markets. Accordingly, the demand will be directed for this
               material because of the preferential merits this product enjoys, with regard to its light
               weight (four times less than the ordinary iron), its resistance which is double the
               resistance of ordinary rods, its flexibility and its being              non-oxidizable.
               Consequently, the project will secure this material which is inexistent in the Syrian
               market. This will generate good profits to the project.

              Competition & competitors:
               There is no local production of basaltic reinforced
               rods, which means that the project will realize a
               relative merit, where there is no competition for this
               product. However, the traditional reinforced iron rods
               remain the single competitor as a well-known
               consumptive type available in the market. Therefore,
               there should be an approach through this project for circulating a new culture about
               the uses of the most efficient building materials in reinforced buildings fit to the
               requirements of the modern buildings at the same time.

              Strategies of sale and distribution:
              - Local markets: (Suwaida'a and the governorates of
                  the country) at a rate of 80% of the production.
              - Regional markets: 20% of the production to the
                  neighboring countries (Iraq, Jordan, Lebanon).

              SWOT:
             a. Opportunities and points of strength:
              - The existence of most raw materials in Suwaida'a at low prices.

                                                        144
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




             -     The continuous and increasing demand for the reinforced rods for construction
                   and infrastructure projects.
             -     Its ability of competing with the prices.

         b. Threats and points of weakness:
            - The ignorance of the public with the preferential features of the product.
            - The problem of securing platinum and the fluctuations of its prices which are
               linked with the global stock markets.

                Revenues of project:
                 The annual revenues of the project for producing 4000 tons are estimated at
                 144,000,000. The price of one ton is SYP 36,000 on average.

          Second: Technical Study:
          Technical description of project:
          a. Location: Suwaida'a, because of the availability of basalt rocks abundantly. The
             technical description of the production process can be summarized by preparing raw
             materials in the quarries (breaking and grinding stones). Then the outcome of the
             stone is washed and melted in special furnaces and cast in moulds prepared in
             advance. Finally, rods are thermally and gradually cooled.

         b. Land: SYP 4,000,000.
            The project will be built on a piece of land of no less
            than 8.5 dunams (8500 m2) according to an internal
            chart fit to the requirements of the production process
            and the conditions of quality control.

         c. Building: (SYP 18,000,000)
            The project needs a building of 1800 m2.

         d. Machinery and equipment: (SYP 240,000,000 of German or Ukrainian origin).
            The project consists of a production line with various moulds as follows:
              - Belts for conveying the mixture (rocks).
              - Grinding and washing unit.
              - Mixing unit.
              - Melting furnaces and converting to fibers.
              - Thermal treatment and cooling unit.
              - Sorting and classifying unit.
              - Other equipments.



                                                     145
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




         e.  Means of transportation (SYP 11,000,000)
         f.  Furniture and furnishing: (SYP 1,000,000).
         g.  Expenses of incorporation and licenses (SYP 6,000,000).
         h.  Commodity requirements: (SYP 32,000,000).
            - Raw materials: (basalt, platinum, and other plastic materials): SYP 22,000,000.
            - Other commodity requirements (electricity, water, fuel, gas IPO): SYP
                10,000,000.
         i. Service requirements: (maintenance, mail, telephone, advertisement,
             promotion,…):          SYP 4,500,000.

         j. Administrative structure - salaries and wages:
            The administrative and organizational structure of the project consists of:
              - Promotion and sales department: It is
                   responsible     for    drawing      up   the
                   advertisement and promotional polices as
                   well as supervising the processes of
                   distribution and sales for the agents.
              - Production department: It is responsible
                   for all stages of the production process, in
                   addition to the laboratory section.
              - Human resources and finance department:
                   It comprises the financial department, personal affairs department, drivers and
                   workers.
            The employment needed for the project is estimated at 45 workers with one shift,
            distributed to 8 administrative officials, 37 technicians, production & maintenance
            workers and guards. The total cost of salaries and wages, including socal insurances,
            is estimated at SYP 13,000,000.

          Third: Financial Study:
             Estimation of investment costs:
             - Fixed capital: SYP 280,000,000.
             - Working capital: SYP 25,000,000.

          Estimation of annual operating costs:
          - Commodity requirements (supplies): SYP 32,000,000.
          - Service requirements: SYP 4,500,000.
          - Wages and employment: SYP 13,000,000.
          - Depreciations: SYP: 28,500,000.
            Variable costs are estimated at SYP 40,800,000 and fixed costs are estimated at SYP
            37,200,000.


                                                    146
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




             Economic and financial analysis of project:
             - Total investment costs = SYP 305,000,000.
             - Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
                  165,080,000.
             - Total annual costs (the average lifetime of the project is 10 years) = SYP
                  86,185,000.
              Notice: Revenues are raised 3% and costs are raised 4% during the production
              lifetime of the project.

            Economic parameters of project:
             a. Annual gross profits                           = SYP 107,395,000.
             b. Net profits                                    = SYP 78,895,000.
             c. Pay-back period                                = 2.8 years
             d. Rate of return of capital (investment)         = 35%
             e. Net present value at a discount rate of 15%    = SYP 189,135,869.
             f. Break-even point                               = 32% = SYP 52,825,600.
             g. Internal rate of return                       = 31.1%
             h. Added value                                   = SYP 112,000,000.

             The project is largely sensitive towards the fall of its revenues, where the internal
             rate of return decreases to 25.5% in case the revenues decrease at a rate of 20%.

            Most important required permits:
             - Licensing under law No. /8/ Syrian Investment Agency.
             - The approval of the General Establishment of Geology.
             - Industrial decision / Ministry of Industry.
             - Approving the engineering charts from the Association of Engineers.
             - Administrative permit / Suwaida'a Governorate – Technical Services
             - Ecological consent / Suwaida'a Governorate – Directorate of Environment.




                                                    147
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                              A Summary of a Feasibility Study
                 A Factory of Melting Basalt and Manufacturing Basaltic Pipes
                                    Suwaida'a Governorate

           About the project:
            The project of producing basaltic pipes is listed under
            the projects of engineering industries, where basaltic
            stones are used in many developed and modern
            construction industries. However, the distinguished
            features of basaltic threads and fibers play an
            important role in their industrial uses, to the extent
            that they are used with a high efficiency in
            manufacturing pipes of moving oil, coke, chemicals,
            fertilizers, sewerage and other materials. It is to be mentioned that the Syrian basalt
            is abundantly available in the southern area, especially in Suwaida'a governorate
            (the homeland of the project) and Horan plain. It is considered the best suitable
            kind for this industry. The project makes use of a competitive feature, where basalt
            is characterized by being easy to extract because it is apparent on the surface, which
            supports manufacturing it economically.

              This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
           Product & quality:
              The project will produce basaltic pipes used for transporting oil, coke and sewage,
              in addition to other uses, with different diameter from 100 – 1000 mm and different
              lengths reaching to 15 m. These kinds are featured by being heatproof able to bear a
              temperature of 700 centigrade. They are also moisture-resistant, and they are
              characterized by non-absorbability. They are soundproof and electricity resistant.
              They are highly solid and resistant to the mechanical factors such as corrosion and
              erosion. They are also resistant to chemicals such as acids, alkalis and salty water.
              They are also frost-resistant to the fluctuations of heat. Moreover, they are five
              times less in weight than metal pipes, and their service virtual lifetime is 60 – 100
              years without being in need to be protected or insulated.

             Study of demand:
              The demand for basaltic tubes usually arises from the need of the oil and gas sector
              as well as the sewage projects and treatment plants. In 2009 Syria imported about
              68563 tons of iron and steel tube which are used in mining oil and gas at a value of


                                                    148
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Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




                 SYP 4035.2 thousand as illustrated in the table below, based on the data of the
                 Central Bureau of Statistics:
                              pipe type            Qty (ton)      Value (thousand SYP)
                   pipes of transporting oil & gas 22394        1534436
                   pipes made of iron & steel      19133        659964
                   pipes of lining oil & gas wells 19419        1296280
                   pipes of different diameters    7617         544517
                   Total                           68563        4035197

                Study of supply:
                 This project is considered the first of its kind in Syria and in the Arab world. Such
                 industries are only now existent in Germany, Russia and Ukraine, which gives this
                 project a strategic importance, especially its closeness to the oil states, in addition
                 to the different uses such as moving water and sewage…

                Gap between demand supply:
                 Basalt pipes are a new type in the Syrian and Arab industry. Accordingly, we
                 expect there will be a demand for these materials, due to the preferential merits of
                 these products in terms of their durability and light weight (four times less than the
                 iron pipes), in addition to the resistance which is double the resistance of iron,
                 flexibility and non-rustability. Consequently, the project will provide this material
                 which is needed in the Syrian and Arab markets. This will generate more profits.

                Competition & competitors:
                 No local or Arab production of basalt pipes is available. Consequently, this project
                 will realize a relative merit, where there will not be competition to this product.
                 Metal pipes will be the traditional competitor as a consumptive type available in the
                 markets. Through this project a new culture about using these pipes, which are
                 more efficient in the process of mining oil, gas and their derivatives in addition to
                 the water and sewage, will be circulated in a way that fit the requirements of the
                 modern industries at the same time.

                Strategies of sale and distribution:
          -      Local markets: (the eastern area, Homs and Banias) 50% of its production.
          -      Regional markets: (Arab markets: Iraq and Gulf States) 50% of its production.

                SWOT:
            a.   Opportunities and points of strength:
          -      Raw materials are abundantly available in Suwaida'a governorate with low prices.
          -      The permanent and increasing demand for the pipes needed for piping oil, gas and
                 their derivatives, as well as water.
                                                      149
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




          -   The light weight and the long virtual lifetime, in addition to
              the specifications of the product which make it distinguished.
          -   The ability of competition in terms of prices for not being
              linked with the prices of the international markets.

          b. Threats and points of weakness:
          - The lack of the sufficient awareness of the public with the
             detailed features of the product. (Concentration will be
             advertisement and promotion campaigns).
          - The high cost of transporting the product because of its large and long sizes.
             (Exportation by ships).

             Revenues of project:
              The annual revenues of the project for producing 5000 tons per year from all
              diameters and lengths are estimate to SYP 175,000,000.
              The price of one ton is SYP 35000 on average.

          Second: Technical Study:
           Technical description of project:
          a. Location: Suwaida'a governorate because of the availability of basalt stone as a
             raw material with competitive prices.
          b. Land: SYP 6,000,000.

              The project will be built on a piece of land of no less than 10 donums, according to
              an internal chart fit to the requirements of the production process and the conditions
              of controlling quality.

          c. Building: (SYP 36,000,000)
             The building needs a building of about 2400 m2.

          d. Machinery and equipment: (SYP 260,000,000 of German or Russian origin)
             The project consists of a production line with various moulds as follows:
            - Conveying belts for transporting stones.
            - A breaking, grinding and cleaning unit
            - A mixing unit
            - Milting furnaces
            - A casting unit
            - A cooling and thermal treatment unit.
            - A drawing, lathing and retouches unit.
            - A sorting and classifying unit.
            - Other equipments and instruments.
                                                    150
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          e. Means of transportation /for production & service/ (SYP 12,000,000 )
          f. Furniture and furnishing: (SYP 2,000,000).
          g. Expenses of incorporation and licenses (SYP 4,000,000).

          h. Commodity requirements: (SYP 35,000,000).
             - Raw materials: SYP 24,000,000.
             - Other commodity requirements (electricity, water, fuel): SYP 11,000,000.
          i. Service requirements: ((maintenance, mail, telephone, advertisement, promotion,
             SYP 5,500,000).

          j. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:
             - Production department: It is responsible for all stages of the production
                 process, in addition to the laboratory and quality section.
             - Promotion and sales department: It is responsible for drawing up the
                 advertisement and promotional polices as well as supervising the processes of
                 distribution, sales and agents.
             - Human resources and finance department: It comprises the financial
                 directorate, personal affairs directorate, drivers and workers.

              The employment needed for the project is estimated at 55 workers with one shift,
              distributed to 8 administrative officials, 47 experts, technicians, guards. The total
              cost of salaries and wages, including social insurances, is estimated at SYP
              15,000,000.

          Third: Financial Study:
             Estimation of investment costs:
          -   Fixed capital: SYP 320,000,000.
          -   Working capital: SYP 25,000,000.
             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP 35,000,000.
          -   Service requirements: SYP 5,500,000.
          -   Wages and employment: SYP 15,000,000.
          -   Depreciations: SYP: 31,400,000.

              Variable costs are estimated at SYP 45,400,000, and fixed costs are estimated at
              SYP 41,500,000.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 345,000,000.


                                                    151
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          -  Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
             220,113,000.
          - Total annual costs (the average lifetime of the project is 10 years) = 98,604,000.
          Notice: Revenues and costs are raised 5% during the production lifetime of the project.

             Economic parameters of project:
              a. Annual gross profits                          = SYP 152,909,000.
              b. Net profits                                  = SYP 121,509,000.
              c. Pay-back period                              = 2.3 years
              d. Rate of return of capital (investment)      =44 %
              e. Net present value at a discount rate of 15% = SYP 329,123,302
              f. Break-even point                             = 25% = SYP 55,028,250
              g. Internal rate of return                     = 37.6%
              h. Added value                                  = SYP 140,000,000.

              The project is largely sensitive towards the fall of its revenues, where the internal
              rate of return decreases to 25.8% in case the revenues decrease 20%.

             Most important required permits:
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   The approval of the General Establishment of Geology
          -   Industrial permit / Ministry of Industry.
          -   Administrative permit / Suwaida'a governorate – Technical Services
          -   Subscription and allotment
          -   Ecological consent / Suwaida'a governorate – Directorate of Environment




                                                    152
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                                A Summary of a Feasibility Study
                             A factory of Producing Screws and Nuts
                                    Qunaiterah Governorate

           About the project:
            The project is listed under the engineering
            industries. It aims at producing screws and nuts
            made of material alloys. Products will be of
            different shapes, volumes and versatile for
            houses and industries. These products will be
            manufactured from high quality raw materials
            according to the international specifications.
            The project is suggested to be in Qunaiterah
            governorate with an annual production capacity
            of 4,700 tones.
            This study includes: marketing study, technical study and financial study.

          First: Marketing Study:
             Product & quality:
              The project will produce screws with different shapes and different sizes from the
              best qualities of hardened iron or alloys. The products of the project form one of the
              most important linking tools which are used in all fields of industry. There will be
              various kinds of screws.
               The most important of which is “steel screw 8.8mm. This kind will form 20% of
              the volume of the production. There will be other kinds of screws, MDF screws,
              and cylinder screws with a production capacity of 40%, in addition to nuts with a
              production capacity of 40%.

             Study of the demand
              The demand for screws and nuts arises from all industrial, craftsmen and service
              sectors. It turned out that the more classes to consume the products of the project
              are the factories, ironmongery stores, maintenance workshops, cars and bicycles
              workshops…
              There is a continuous increasing demand for these products. The statistics of the
              Central Bureau of Statistics show that the annual consumption of screws in Syria is
              estimated at 15,600 tons for the purpose of maintenance or for the service and
              industrial establishments or in the industry of household utensils and furniture.

             Study of supply:
              As issued by the Central Bureau of Statistics, the volume of imports of all kinds of
              screws and nuts is 12,496 tons. A marketing study done for this purpose indicates
              that there is no factory for manufacturing nuts in Syria. With regard to screws, there
              are four factories. Three of which are closed. As for the imports, they come from
              many countries according to the following order:
              97% from China because of the low price, 6% from Taiwan, 5% from Iran, 4%
              from Turkey and 6% from other countries.
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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




             Gap between demand and supply:
              The study of the demand and supply shows that there is a big gap because of the
              lack of the local production and the full dependence on the imports. This project
              will fill part of this gap and support the local production.

             Competition & competitors:
              There is only one factory (JUDE). It has recently begun producing screws with a
              production capacity and limited sizes which only covers a small part of the need of
              the country. On the level of the Arab world, there is only one factory in Saudi
              Arabia in Al-Khubar (Al-Rashed Group).
              Only a few people of importers in Damascus and Aleppo control the Syrian market
              and cover the need of the local market.

             Strategies of sale and distribution:
          -   Local markets: 90% (Damascus, Aleppo, Damascus) because the industrial cities
              are centered in these cities.
          -   Regional markets: 10% (Lebanon, Iraq).

           SWOT:
          a. Opportunities and points of strength:
          - The industrial extension and the prosperity of the constructional movement, and
             consequently, the increase of the local demand for screws.
          - The availability of the qualified cheap labor (administrative and technical
             experiences).
          - The facilities offered for encouraging exportation.

          b. Threats and points of weakness:
          - The link in the price of the raw materials, especially iron and steel, with the world
             stock market.
          - Most raw materials are imported, and there is a difficulty in the transactions of
             importing iron.
          - The high price of power (electricity, fuel …).

             Revenues of the project:
              The revenues of the project are estimated at SYP 292 million with an annual
              production capacity of 4,700 tons.
               Product type      Planned production/ton     Price / ton /SYP                  Revenues /SYP
               Steel screw              940 tons                 70,000                         65,800,000
               Other types             1880 tons                 60,000                        112,800,000
               Nuts                       1880                   60,000                        112,800,000
               Exhausts                                                                          600,000
               Total                     4700                                                  292,000,000




                                                      154
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Investment Opportunities Guide
                                                                                                      Beat Al khebrah
                                                                                                                    Syria 2011
                                                                                             Consulting & Studies of Economic
                                                                       




          Second: Technical Study:
           Technical description of the project:
          a. Location: Qunaiterah, where the good
             infrastructure and cheap manpower are available
             and near from Damascus.

          b. Land and building: ( SYP 12,000,000)
             The project needs a piece of land of 5 donums
             estimated at 2 million Syrian pounds and a
             factory with an internal design fit to the size and
             position of the machines at an estimated value of SYP 10,000,000.

          c. Machinery and equipment: (SYP 113,000,000 of west-European origin)
             The production line consists of:
          - A production line for manufacturing steel screws.(SYP 23,000,000).
          - A production line for manufacturing nuts ( SYP 13,800,000).
          - A production line for manufacturing other kind of screws (SYP 27,600,000).
          - A special electric convertor (SYP 25,000,000).
          - A furnace for treating solidness (23,600,000).

          d. Means of transportation (SYP 5,000,000 )
          e. Furniture and furnishing: (SYP 500,000).
          f. Expenses of incorporation and licenses (SYP 3,000,000 )
          g. Commodity requirements: (SYP 203,000,000).
           - Raw materials: crude iron, steel, other alloys : (SYP 192,000,000)
           - Other commodity requirements (packing materials electricity, oils and lubricants):
             (SYP 11,000,000).
          h. Service requirements: ((maintenance, mail, telephone, and other supplies: SYP
             5,500,000.

          i. The administrative structure, salaries and wages: (SYP 8,500,000).
             The organizational structure of the project consists of:
               - Production and purchases department: It is responsible for the process of
                  production in terms of the study of the raw materials and purchasing them, in
                  addition to testing the final product.
               - Administrative and financial department: It is responsible for running and
                  following up the administrative and financial affairs.
               - Marketing and sales department: It is responsible for promotion, sales and
                  distribution.
               - Human resources department: It supervises the process of attracting and
                  recruiting the needed employment, in addition to developing their experiences
                  and skills.

                                                  155
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




              The employment needed for the project is estimated at 40 workers with one shift.
              The annual total cost of salaries and wages, including the social insurances is
              estimated at SYP 8,500,000.

          Third: Financial Study:
             Investment costs are estimated as follows:
          -   Fixed capital: SYP133,500,000
          -   Working capital: SYP 56,500,000

             Annual operating costs are estimated as follows:
          -   Commodity requirements: SYP 203,000,000
          -   Service requirements: SYP 5,500,000.
          -   Wages and employment: SYP 8,500,000.
          -   Depreciations: SYP: 13,500,000
              Variable costs are estimated at SYP 211,900,000, and fixed costs are estimated at
              SYP 18,600,000.

              Economic and financial analysis of the project:
          -    Total investment costs = SYP 190,000,000.
          -    Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
               334,745,000.
          - Total annual costs (the average lifetime of the project is 10 years) = SYP
               273,009,000.
           Notice: Revenues are raised 3% and costs are raised 4% during the production
           lifetime of the project.

             Economic parameters of the project:
                a. Annual gross profits                             = SYP 75,236,000
                b. Net profits                                      = SYP 61,736,000.
                c. Pay-back period                                  = 2.5 years
                d. Rate of return of capital (investment)           = 40%%
                e. Net present value at a discount rate of 15% = SYP 163,370,280.
                f. Break-even point                                 = 23% i.e. 76,991,350
                g. Internal rate of return                           = 38.1%
                h. Added value                                      = SYP 89,000.000
              The project is largely sensitive towards the fall of its revenues at a rate of 10%
              while the internal rate of return decreases to 18.6%.
             Most important required permits:
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Industrial permit / Ministry of Industry.
          -   Administrative permit / Qunaiterah governorate – technical services.
          -   Ecological consent / Qunaiterah governorate.
                                                   156
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                             A Summary of a Feasibility Study
                    A Factory of Concrete Blocks with internal insulation
                                In Qunaiterah Governorate

           About the project:
            The book is listed under the projects of building
            materials. The double-cement block that is
            isolated by polystyrene (2-5) cm is considered
            heat resistant (2,155) watts per one square meter.
            It costs 15% higher than the ordinary block, but it
            resists heat 50% more than the ordinary block.
            That is to say, the double-insulated block which is
            isolated by polystyrene saves the costs of isolation
            and the consumption of electricity (protected from
            the direct sun rays. It also lives a long period parallel to virtual age of the project.
            The project will make use of the feature of competitiveness which gives it wide
            selling markets because of the relatively high prices of power. The project is
            suggested to be built in Qunaiterah.

              This summary of the feasibility study includes: marketing study, technical study
              and financial study.

          First: Marketing Study:
             Product & quality:
              The project tends to produce ordinary and light blocks.
              Cement block is composed of sand, gravel, cement and
              water with normal rates of cement. It contains an isolating
              layer automatically put within moulds. It is used for
              buildings and hardy roofs. The product is characterized by being hard, good
              insulator to heat and humidity. It can be used for all external and internal walls. In
              addition, it is featured by being light and easy to cut.

             Study of the demand
              The demand for concrete block usually arises from the need of the building and
              constructing sector which is estimated at 732 thousand residential units during the
              eleventh five- year plan; that is to say, 200 thousand units per year. In the previous
              plan there were 687 thousand units. Only 483 units were carried out. The share of
              the private sector was 77.3%. The number of empty and occupied houses is
              estimated at 3989053 in 2009 with a floor area of 413209 m2. Consequently, the
              share of one family is 111m2. The annual volume of the local market is nearly 306
              million blocks.

             Study of supply:
              The number buildings done in 2009 were nearly 10142 residential units at a growth
              rate of 42.8%. The following table shows the period from 2000 – 2009 as issued by
              the Central Bureau of Statistics:
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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




                 Year      Floor area of residential         No. of           Floor area of othe
                            buildings/thousand m2       residential units   buildings/thousand m2
                 2000                1862                     15995                   427
                 2005                9901                     80930                  2179
                 2009               12161                    101042                  2142

             Gap between the demand and the supply:
              The insulating concrete block is relatively a new type in the Syrian market. This
              material is not widely prevalent. Therefore the demand for this material is subject to
              the climatic changes which make Syria hot in summer and cold in winter. On the
              other hand, this is linked with the rise of the price of power. Consequently, the
              project will provide this material which is nearly absent in the Syrian market. This
              will generate new profits to the project.

             Competition & competitors:
              At present, there is no production of the insulating concrete blocks. Consequently,
              this will realize a relatively important advantage to the project, where there is no
              competition. The conventional blocks remain the only competitor as a well-known
              consumptive type easily available in suitable prices for the people of limited
              income. So, this project is directed to a certain type of residential buildings which
              correspond to the modern requirements of building, and at the same time is fit to the
              people of limited income.

             Strategies of sale and distribution:
          -   Local markets: (Qunaiterah, Damascus Rural Area, Sweida, Dara) at a rate of
              100% of the product, because these governorates are able to consume all the
              product as a result of being close and because of the reduction of the cost of moving
              block among the neighboring governorates.
          -   Regional markets: Regional markets are not economically feasible because of the
              global rise of the costs of transportation.

           SWOT:
          a. Opportunities and points of strength:
          - The availability of raw materials and polystyrene in Qunaiterah governorate with
             reasonable prices.
          - The increasing demand for this kind insulating block.
          - Being easy to be stored, because it does not need circumstances of protection.

          b. Threats and points of weakness:
          - The competition of the existing conventional block in the market.
          - The rise of the rate of waste due to depending on old production lines.




                                                       158
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




              Revenues of the project:
               The annual revenues of the project are estimated at 8 million blocks, which work
               out to 90 thousand tons at a value of SYP 160,000,000, where the price of one piece
               of block is SYP 20 on average.

          Second: Technical Study:
           The technical description of the project:
          a. Location: it is in Qunaiterah governorate where there are no similar factories for
             producing the insulating concrete blocks neither in the area nor in the surrounding
             cities. And raw materials are abundantly available with low prices.

          b. Land & Building: (SYP 17,000,000)
             The factory will be built on a piece of land of no less than 12 donums according to
             an internal chart fit to the requirements of the production process and the conditions
             of quality control. The piece of land is estimated at 10,500,000. And the building is
             estimated at SYP 6,500,000.

          c. Machines and equipment: (SYP 63,000,000 of Turkish or Chinese origin).
             The production line of the project consists of many moulds:
          - An automatic machine for making. blocks with an automatic press.
          - A mixer with two columns.
          - A belt for moving the mixture and a belt
             for moving sand.
          - A triple tank for sand with a scale.
          - Silos of cement and filters for the silos.
          - A conveying belt for cement.
          - Other equipment.
          - Machines of making insulating granules.

          d.   Means of transportation: (SYP 6,000,000)
          e.   Furniture and furnishing: (s,p 1,500,000).
          f.   Expenses of incorporation and permits (SYP 2,500,000).
          g.   Commodity requirements: (SYP 121,000,000).
          -    Raw materials (cement, sand, gravel, polystyrene): SYP 105,000,000
          -    Other commodity requirements (electricity, water, fuel): SYP 16,000,000.
          h.   Service requirements: (maintenance, mail, telephone, advertisement,
               promotion,…): SYR 4,000,000.

          i. The organizational structure, salaries and wages:
             The organizational structure of the project consists of:
             - Manager of the factory.
             - Production department: (manufacturing, maintenance, workers).
             - Administrative officials (accountants, treasure, storehouses, HR).
                                                    159
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




               - Purchases: (raw materials, production requirements.
               - Marketing: ( motion of cars , sales)
              The employment needed for the project is estimated at 20 workers with one shift,
              distributed to 3 administrative officials, 17 technicians, production and service
              workers. The total cost of salaries and wages, including social insurances, is
              estimated at SYP 6,000,000.

          Third: Financial Study:
             Investment costs are estimated as follows:
          -   Fixed capital: SYP 90,000,000
          -   Working capital: SYP 30,000,000

             Annual operating costs are estimated as follows:
          -   Commodity requirements: SYP 121,000,000.
          -   Service requirements: SYP 4,000,000.
          -   Wages and employment: SYP 6,000,000.
          -   Depreciations: SYP: 8,625,000.
              Variable costs are estimated at SYP 126,600,000, and fixed costs are estimated at
              SYP 13,025,000.

             Economic and financial analysis of the project:
          -   Total investment costs = SYP 120,000,000
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              201,246,000
          -   Total annual costs (the average lifetime of the project is 10 years) = 172,261,000.
              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project..

             Economic parameters of the project:
                a. Annual gross profits                                 = SYP 37,610,000
                b. Net profits                                         = SYP 28,985,000
                c. Pay-back period                                      = 3,2 years
                d. Rate of return of capital (investment)                = 31%%
                e. Net present value at a discount rate of 15%           = SYP 49,944,678
                f. Break-even point                                     = 31%
                g. Internal rate of return                             = 25.5%
                h. Added value                                         = SYP 39,000,000
              The project is largely sensitive towards the fall of variable costs at a rate of 10%
              while the internal rate of return decreases to 6.8%.




                                                   160
                                                                                                       
Investment Opportunities Guide
                                                                                                      Beat Al khebrah
                                                                                                                    Syria 2011
                                                                                             Consulting & Studies of Economic
                                                                       




             Most important required permits:
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Industrial permit /Ministry of Industry
          -   Administrative permit (Qunaiterah governorate – technical services)
          -   Ecological consent. (Qunaiterah governorate – environment Directorate)
          -   Approving engineering charts from the Syndicate of Engineers)




                                                  161
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                                      A Summary of a Feasibility Study
                                     A Factory of Veterinary Medicines
                                  Al-Hasakah Governorate /Industrial City/

               About the project:
                The project consists of an integrated line for
                manufacturing veterinary medicines, depending on the
                imported active substance, and some locally imported
                materials.
                The project relatively depends on the project area as an
                integrated agricultural area, comprising the highest rate
                of the livestock growth.
                The project is considered eco-friendly, where there are
                no gaseous emissions or remains out of the process of
                manufacturing.
                The project is suggested to be built in al-Hasakah governorate, due to the
                availability of good selling markets for these products.

          First: Marketing Study:
                 Product & quality:
                  The project will produce high quality products with different measures:
                  - Liquid medicines.
                  - Powder
                  - ampoules

                  The good quality of the products of medicine is generally considered the most
                  effective factors for marketing them. So, the production should be accompanied
                  with special advertisement about their quality. They should also be standard and
                  accredited by international companies which produce similar kinds.

                 Study of demand:
                  There is a regular increase of the animal wealth in Syria, which entails an increase
                  of demand for the veterinary medicines. There is also a new demand for the
                  medicines of pet animals as a result of the rise of this type. The total number of
                  agricultural animals (cows, sheep, goats, buffalos) in 2009 is estimated at 21
                  million, and poultry is estimated at 24 million birds.

                 Study of supply:
                  There are nearly 47 factories of veterinary medicines. They produce all kinds like
                  powder, liquid and injection. These factories registered 2700 pharmaceuticals. Part
                  of these products is exported to the Arab countries and central Asian countries.
                  Imports of medicines are estimated at 568 thousand tons a year.


          
              Summary of Foreign Trade 2009
                                                       162
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Investment Opportunities Guide
                                                                                                      Beat Al khebrah
                                                                                                                    Syria 2011
                                                                                             Consulting & Studies of Economic
                                                                       




             Gap between demand supply:
              There is no gap deserving to be mentioned, because the market is open and active
              for this substance, and quality is the most important standard for evaluating the
              products and the increase of its sales.

             Competition & competitors:
              There is an intensive competition from the
              neighboring countries. There are 22 – 25
              factories of veterinary medicines, although
              the livestock there is 10% of the Syrian
              livestock. Consequently, most of the
              production of these factories is prepared for
              exportation to the foreign markets. It is
              noticed that manufacturing veterinary
              medicine is centered to the private sector.
              The role of the Ministry of Agriculture is limited to manufacturing vaccines at a
              rate of 70% of the market need for the vaccines of poultry and other vaccines.

             Strategies of sale and distribution:
              - Local markets: 40% of the local production.
              - Regional markets: 60% of the production, in order to realize savings of foreign
                  currency.

             SWOT:
              a. Opportunities and points of strength:
               - The possibility of importing raw materials with reasonable prices.
               - The increasing demand for the products of the project in parallel with the
                   increase of livestock.
               - The accession of Syria to the Free Arab Trade Zone, which opens new
                   prospects of exportation. Added to this is the large development of the
                   exportation rates for such industries.

              b. Threats and points of weakness:
                 - The competition of the existing brands which have a reasonable quality.
                   Therefore, there must be a concentration on the quality and on raising the
                   efficiency as well as the competition in prices.
                 - The fluctuation of the prices of raw materials.
                 - The relevant difficulty of receiving raw materials and moving them to the
                   project.




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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




              Revenues of project:
              Season                Product             Qty/ton       Price                              Total/SYP
           Locally marketed       Various medicines       240       SYP 950,000                        SYP 228,000,000
           Exported               Various medicines       360         $21,000                          SYP 347,760,000
                 total                                                                                 SYP 575,760,000

          Second: Technical Study:
            Technical description of project:
             a. Location: Al-Hasakah, the Industrial City, where the agricultural livestock is
                estimated at 10% of the total livestock of Syria.

              b.   Land and Building: (SYP 42,000,000)
                   The factory will be built on a piece of land of no less than 10,000 m2 fit to the
                   need of the project at an estimated value of SYP 11,000,000.
                   The building will be designed according to an internal design fit to the
                   requirements of the production process and the relevant conditions of quality
                   control and storing, at an estimated value of SYP 31,000,000.

              c.   Machinery and equipment: (SYP 65,500,000 of a European origin).
                   The project consists of three main production sections:
                   1. Machines of reception and examining: They receive and examine raw
                       materials and identify their suitability to the production processes.
                   2. Machines of Mixing and blending: They mix the active materials with the
                       inactive ones according to certain rates, until they reach the highest rate of
                       the possible quality.
                   3. Packing and packaging machines: They move the mixed and blended
                       materials to glass, plastic or paper containers as needed. Then, they are
                       packaged and arranged in carton boxes and suitable bags.

              d. Means of transportation (SYP 3,000,000).
              e. Furniture and furnishing: (SYP 500,000).
              f. Expenses of incorporation and licenses (SYP 7,500,000).
              g. Commodity requirements: (SYP 501,596,000).
                 - Raw materials: The active substances and the raw materials needed for
                    manufacturing veterinary medicines at an estimated value of SYP
                    497,777,000.
                 - Other commodity requirements (electricity, water, fuel): SYP 3,819,000.
              h. Service requirements: (maintenance, mail, telephone, advertisement,
                 promotion,…):            SYP 9,274,000.
              i. Administrative structure - salaries and wages:
                - Production department: It is responsible for all stages of the production
                  process, in addition to the laboratory of quality control.

                                                      164
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




               -   Promotion and sales department: It is responsible drawing up the advertisement
                   and promotional polices as well as supervising the processes of distribution and
                   sales within the different halls.
               -   Human resources and finance department: It comprises the financial affairs
                   directorate, the personal affairs, drivers and workers.

              The employment needed for the project is estimated at 37 workers with one shift,
              distributed to 3 administrative officials, 21 experts, technicians, specialized
              workers, and 13 ordinary and provisional workers. The total cost of salaries and
              wages, including social insurances, is estimated at SYP 11,220,000.

          Third: Financial Study:
              Estimation of investment costs:
              - Fixed capital: SYP 118,500,000.
              - Working capital: SYP 87,500,000.

              Estimation of annual operating costs:
              - Commodity requirements (supplies): SYP 501,596,000.
              - Service requirements: SYP 9,274,000.
              - Wages and employment: SYP 11,220,000.
              - Depreciations: SYP: 10,300,000.

              Variable costs are estimated at SYP 513,503,000 and fixed costs are estimated at =
              SYP 18,886,800.

              Economic and financial analysis of project:
              - Total investment costs = SYP 206,000,000.
              - Value of annual revenues = (the average lifetime of the project is 10 years) =
                 SYP 724,185,000.
              - Total annual costs (the average lifetime of the project is 10 years) = SYP
                 664,766,000.

              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project.

             Economic parameters of project:
               a. Annual gross profits                          = SYP 69,719,000
               b. Net profits                                   = SYP 59,419,000
               c. Pay-back period                               = 3 years
               d. Rate of return of capital (investment)         = 34%
               e. Net present value at a discount rate of 15%   = SYP 106,785,568.
               f. Break-even point                              = 24% = SYP 172,804,400
               g. Internal rate of return                       = 27.9%

                                                    165
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




                h. Added value                               = SYP 74,164,000.

              The project is largely sensitive towards the fall of its revenues at a rate of 5%,
              where the internal rate of return decreases to 9 %.

              Most important required permits:
              - Industrial permit / Ministry of Industry.
              - Agricultural permit/ Ministry of Agriculture
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allocation .
              - Building license.
              - Administrative permit and ecological consent.

              The industrial cities include the service of the one STOP SHOP which provides all
              these permits.




                                                   166
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                                  A Summary of a Feasibility Study
                                      Producing gypsum boards
                               Deir Ezzor Governorate/ Industrial City/

           About the project:
            The project aims at producing gypsum boards fit to
            the increasing demand by the companies and
            citizens for the ready houses, due to the
            development of the method of construction,
            finishing works and modern decors. Deir Ezzor is
            considered rich in the sources of raw materials
            needed for this industry. The expansion of this
            product and the inexistence of a similar factory have
            given the eastern zone an additional advantage to
            the site.

              This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
           Product & quality:
              The project will produce a high quality product of gypsum boards fit to the different
              constructional needs measuring 8 – 15 mm thick, 1200 – 1220 mm wide and 2400 –
              3000 mm long. They will be formed according to the latest technologies. They are
              characterized by being light, anti-fire, anti-humidity, anti-shock, soundproof and
              heatproof. They can be cut and excavated as required in decoration works.

             Study of demand and supply and gap between them:
              The demand for gypsum boards is linked with the increase of the constructional
              motion, where no less than 130 residential units and 720 commercial units are built.
              They are especially used in no less than 25% of the new buildings (residential and
              commercial). Most modern houses depend on gypsum boards in their finishing
              works, especially for ceilings, in order to hide faults and give more glamour and
              beauty to the houses. Consequently, the annual estimated need is no less than
              780,000 m2.

              On average, each house needs 30 m2 (12 -50 m2 boards), in addition 234,000m2 of
              gypsum boards (30%) are imported.
              This quantity (234,000m2) of gypsum boards is practically considered a gap, in
              addition to the gap which is created from the incapability of the local production of
              covering the consistent and increasing demand for the materials of finishing works.
              And sometimes, the local market suffers from the problem of satisfying the
              customers' taste, because of the little produced assortment and the possibility of
              exporting 20% as minimum.



                                                    167
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




               Competition & competitors:
                There are no competitive products or projects in the project area. There are about 5
                factories in Damascus countryside and Aleppo.

               Strategies of sale and distribution:
          -     About 80% of the product will be locally marketed in the markets of the eastern
                zone and in other markets, and around 20% will be exported to the neighboring
                markets, especially Iraq, Gulf States, Jordan and Lebanon.

               SWOT:
              a. Opportunities and points of strength:
               - The availability of the sources of raw materials near the project area, which
                  secures the regular supplies.
               - The increasing demand for the product which is linked with the new methods of
                  construction, finishing works and decoration.
               - The weakness of the internal competition and the possibility of exportation to
                  other countries.

              b. Threats and points of weakness:
              - The unlimited variety of the customers' desires leads to the replacement of
                 models and moulds, which in turn, leads to the instability of the production lines.
              - The limited competition of some imported products in quality and prices.

              Revenues of project:
                 Marketing       Product           Qty/m2       Price                      Total/SYP
              Locally         Gypsum board         120,000      SYP 700                    SYP 84,000,000.
              exportation     Gypsum board         $ 17.0       17.0                       SYP 23,460,000
              Sum total                                                                    SYP 107,460,000

          Second: Technical Study:
               Technical description of project:
              a. Location: The project will be built in Deir Ezzor, the industrial city, because of
                 the availability of raw materials in the governorate.

           b. Land and Building: (SYP 46,000,000)
              The factory will be built on a piece of land of no less 5000 m2 at a value of SYP
              3,250,000. As for the building, it will occupy 2800 m2, including production
              hangars, storehouses and public utilities at a value of SYP 42,750,000.

           c.    Machinery and equipment: ( SYP 65,000,000 of a west European origin ).
                 The production line consists of:
                - The section of receiving the raw materials gypsum.
                - The section of the supplies of other raw materials.
                                                     168
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                 -   The section of water supplies
                 -   The section of the formation of boards.
                 -   The section of the conveyer.
                 -   The section of the systems of drying.
                 -   The section of collecting dust.
                 -   The monitoring system.

           d.    Means of transportation (SYP 6,500,000)
           e.    Furniture and furnishing: (SYP 1,500,000).
           f.    Expenses of incorporation and licenses (SYP 6,000,000).
           g.    Commodity requirements: (SYP 57,000,000).
                - Raw materials: All the components of the product are local soils fit to the
                  industry at an estimated amount of SYP 45,000,000.
                - Other commodity requirements (electricity, water, fuel): SYP 12,000,000.
              h. Service requirements: (maintenance, mail, telephone, advertisement,
                 promotion,…): SYP 8,000,000.

              i. Administrative structure - salaries and wages:
                The administrative and organizational structure of the project consists of:
                - Production and supply department: It supplies and classifies raw materials and
                  control quality.
                - Financial and administrative department: It supervises the staff, pays their
                  salaries, audits accounts and expenses.
                - Marketing department: It is interested in promotion to the internal and external
                  markets, as well as drawing up the strategic plans of marketing.

                The employment needed for the project is estimated at 41 workers with one shift,
                distributed to 3 administrative officials, 18 experts, technicians and specialized
                workers, 20 ordinary and provisional workers. The total cost of salaries and wages,
                including social insurances, is estimated at SYP 11,000,000.

          Third: Financial Study:
                Estimation of investment costs:
                - Fixed capital : SYP 125,000,000.
                - Working capital: SYP 25,000,000.

                Estimation of annual operating costs:
                - Commodity requirements (supplies): SYP 57,000,000.
                - Service requirements                : SYP 8,000,000.
                - Wages and employment                : SYP 11,000,000.
                - Depreciations                      : SYP 11,437,500.


                                                       169
                                                                                                        
Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




              Variable costs are estimated at SYP 67,800,000 and fixed costs are estimated at
              SYP 19,637,000.

             Economic and financial analysis of project:
              - Total investment costs = SYP 150,000,000.
              - Average of annual revenues for ten years = SYP 135,162,000.
              - Average of annual costs for ten years = SYP 104,916,000.

              Notice: Revenues and costs are annually raised 5% during the lifetime of the
              project.

             Economic parameters of project:
               a. Annual gross profits                              = SYP 41,684,000.
               b. Net profits                                       = SYP 30,246,000.
               c. Pay-back period                                  = 3.6years
               d. Rate of return of capital (investment)       = 28%
               e. Net present value at a discount rate of 15% = SYP 39,791,244.
               f. Break-even point                                = 39% = SYP
               g. Internal rate of return                        = 21.8%
               h. Added value                                     = SYP 50,640,000.

              The project is largely sensitive towards the fall of its revenues 10%, where the
              internal rate of return decreases to 12%.

             Most important required permits:
              - Industrial permit / Ministry of Industry.
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allocation.
              - Building license.
              - Agricultural permit/ Ministry of Agriculture
              - Administrative permit & ecological consent

              The industrial cities include the service of the one stop shop, which provides all
              these permits.




                                                   170
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                              A Summary of a Feasibility Study
                          A Factory of Making and Tanning Leathers
                          Deir Azzour Governorate / Industrial City

           About the project:
            Leather is a durable flexible material made of animals
            skins. Livestock is considered the main source of leather.
            The process of transforming the skin of a live animal into
            a useful product is called (tanning).
            The site of the project is one of the basic factors behind
            the success of the project and the industrial city in Deir
            Ezzor which is considered extremely suitable for the
            project for being near from running water. The project
            plans to export about 30% of its product outside the
            country.
            The project is considered one of the chemical industries. So, it will abide by all the
            adopted environmental conditions of this kind of industries.

          First: Marketing Study:
             Product & quality:
              Tanned leathers are used for manufacturing shoes,
              belts, gloves, coats and handbags, in addition to many
              other products. Tanned leather is characterized by its
              high resistance and durability. Tanned leather is
              manufactured in order to become flexible. After dyeing
              and polishing tanned leather it becomes a glossy
              product or ornamented with distinctive forms.
              The project will offer tanned leathers ready for all
              industries.

             Study of the demand:
              The production of tanned leathers in Syria covers the local demand of this material.
              However there is an increasing world demand for tanned leathers, especially after
              the great development of the industries which depend on the leathers of shoes, bags
              and all the other accessories, even the furniture of luxurious cars. Syria is
              considered one of the exporting countries of fresh ovine leather on the global level.
              It nearly represents 18% of the total value of the world exports of these leathers.

             Study of supply:
              Syria is well-known for the industry of tanned leather, where there are 240
              establishments; 4 of which are large factories attached to the state. There are 82
              establishments in Aleppo. The total production of the public and private sectors is
              nearly 6000 ft2.



                                                    171
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Investment Opportunities Guide
                                                                                                                Beat Al khebrah
                                                                                                                              Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




              Gap between the demand and the supply:
               The gap between the supply and the demand for tanned leathers in Syria is a
               demand gap appearing through the large quantities of exports which amount to
               /9906/ tons of tanned leather as stated by the Syrian Statistic Group in 2010. This
               number confirms the good quality of Syrian leathers overseas and the confidence of
               foreign producers in the Syrian leathers, which asserts the following of a marketing
               study depending on exportation in good rates.

              Competition & competitors:
               As we have said earlier, there are /4/ tanning factories affiliated to the public sector,
               in addition to many craftsmen establishments on the country’s level counting more
               than /400/ establishment. But in the suggested area of the project there are no
               competitive projects.

              Strategies of sale and distribution:
          -    30% of the production will be locally marketed in the domestic markets.
          -    70% of the production will be marketed to the regional and international markets,
               because the foreign demand is larger.

              SWOT:
          a.   Opportunities and points of strength:
          -    The availability of raw materials abundantly in reasonable prices.
          -    The increasing demand for the tanned leathers in parallel with the demographic
               development.
          -    The joining of Syria to the Free Arab Trade Organization and the preparation of
               joining the International Trade Organization, which opens new prospects for
               exportation.
          -    The existence of the project in a growing industrial city increases the facilities
               offered to the project.
          b. Threats and points of weakness:
          - The need of the project to large quantities of water and the states’ policy which is
             related to this issue.
          - The absence of the experienced employment in the project area. Therefore,
             intensified training courses or calling for a technician expert must be done to work
             in the project.

              Revenues of the project:
                    Season            Product        Qty/ton       Price                                S.P total
                    Locally                            360      SYP 235,000                    SYP 84,600,000
                                   Tanned leathers
                   marketed
                   Exported        Tanned leathers     840         $5,200                   SYP 200,928,000
                     total                                                                  SYP 285,528,000


                                                       172
                                                                                                         
Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          Second: Technical Study:
           Technical description of the project:
          a. Location:
             Deir Ezzor/ Industrial City

          b. Land & Building: (s.p. 24,840,000)
             The project will be built on a piece of land of no less than 5,000 m2 fit to the need
             of the project, with a value of nearly s.p. 8,000,000.
             As for the building, it will be designed according to an internal chart fit to the
             production requirements and the conditions of controlling quality which is related
             to the process of production and storing, with a value of s.p. 16,840,000

          c. Machinery and equipment: (s.p.87,000,000 of west- European origin)
             The project consists of the following main section:
          - Reception and washing section: Animal leathers are received and conveyed by a
             belt to washing basins in order to be cleaned from dirt and planktons.
          - Primary treatment system: Leathers are treated by chemical substances like lime,
             arsenic (sodium and non-toxic arsenic. This substance loses its effect when it is
             exposed to the water or sun).
          - Detaching and drying section: Fluff and the remaining wool are detached by
             special machines. Then they are sent to drying machines.
          - Final treatment section: Leathers are treated successively with salt and acid, and
             finally with toxic chrome.
          - Laboratory section: It comprises a group of equipments for determining the
             quality and specifications of the product.

          d. Means of transportation (s.p. 7,500,000).
          e. Furniture & furnishing: (s,p 1,500,000).
          f. Expenses of incorporation and permits (s.p 5,600,000).
          g. Commodity requirements: (s.p 228,863,000).
              - Raw materials: Animal leathers from the slaughterhouses, some supplementary
                 materials, dyes and chemical substances at value of 1.200 tons per year at a
                 value of s,p. 218,890,000.
              - Other commodity requirements (electricity, water, fuel): s.p 9,973,000
          h. Service requirements: Maintenance, mail, telephone, advertisement and
             promotion at a value of s.p. 6,390,000.

          i. The organizational structure:
             - Production department: It is responsible for all stages of the production
                process, in addition to the laboratory and controlling quality.



                                                   173
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




              -    Promotion and sales department: It is responsible for drawing up the
                   advertisement and promotional polices as well as supervising the processes of
                   distribution and organizing foreign contracts.
               - Human resources and finance department: It comprises the financial
                   directorate, personal affairs directorate, drivers and workers.
              The employment needed for the project is estimated at 49 workers with one shift,
              distributed to 3 administrative officials, 18 experts, technicians, specialized
              workers. The total cost of salaries and wages, including social insurances, is
              estimated at s.p. 12,120,000.

          Third: Financial Study:
             Investment costs are estimated as follows:
          -   Fixed capital: s.p 126,440,000.
          -   Working capital: s.p 64,921,000.

             Annual operating costs are estimated as follows:
          -   Commodity requirements: s.p. 228,863,000
          -   Service requirements: s.p. 6,390,000
          -   Wages and employment: s.p. 12,120,000
          -   Depreciations: s.p: 12,462,000
              Variable costs are estimated at s.p. 238,823,000, and fixed costs are estimated at
              s.p. 21,012,200.

             Economic and financial analysis of the project:
          -   Total investment costs = s.p 191,361,000
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = s.p
              359,134,050
          -   Total annual costs (the average lifetime of the project is 10 years) = SYP
              321,401,003
              Notice: Revenues are raised 5% and costs are raised 5% during the production
              lifetime of the project.

             Economic parameters of the project:
               a. Annual gross profits                                = s.p 50,195,047
               b. Net profits                                        = s.p 37,733,047
               c. Pay-back period                                    = 3.8 years
               d. Rate of return of capital (investment)              = 26%
               e. Net present value at a discount rate of 15%     = s.p (38,892,631
               f. Break-even point                                = 36%
               g. Internal rate of return                         = 20.3%
               h. Added value of the project                     = s.p. 56,665,000


                                                   174
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




          The project is largely sensitive towards the rise of variable costs at a rate of 10% while
          the internal rate of return decreases to 0.9%.

             Most required permits:
          -   Industrial permit.
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Subscription and allotment.
          -   Building license.
          -   Administrative permit and ecological consent.

           The industrial cities include the service of the one stop shop, which provides all these
           permits.




                                                     175
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Investment Opportunities Guide
                                                                                                               Beat Al khebrah
                                                                                                                             Syria 2011
                                                                                                      Consulting & Studies of Economic
                                                                                




                                   A Summary of a Feasibility Study
                           A Factory of Ammonium Fertilizer/ Urea CO(NH2)2
                                         Deir Ezzor Governorate

           About the project:
            The project is categorized under the
            chemical Industries. It aims at producing
            "ammonia fertilizer/urea". It is a nitrogen
            fertilizer that enforces plants and helps
            produce chlorophyll which is necessary for
            the growth of plants. It is necessary for
            many kinds of trees and agricultural crops.
            The impotence of the project arises from the need of Syria to increase its local
            production 100% in order to be able to cover its agricultural lands' need for this
            fertilizer. The project is suggested to be built in Deir Ezzor governorate.
               This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
              Product & quality:
               Urea fertilizer CO(NH2)2 is part of NH2). It has the form
               of white pearly granules with a diameter ranging between
               2 – 3 mm. its density is low. Azote (nitrogen) forms 46%
               of its chemical compound, which makes azotic fertilizer
               classified as the highest dense material.

              Study of demand:
               The need of Syria of the nutritious azotic (nitrogen) element in the end of 2009 was
               estimated at 210,362 elements. These quantities are existent in 457,309 tons of urea
               fertilizer which is highly concentrated. This is the need of Syria. This need is
               continuously growing because of the annual increase of new reformed lands in the
               agricultural sector and the desertification which hits the producing land at present, in
               addition to the horizontal and vertical growth of the Syrian agriculture.

              Study of supply:
               The following table shows the Syrian annual production of urea fertilizer from 2005
               – 2010.
       Description                             2005         2006      2007      2008                        2009           2010
       Production of urea fertilizer/ton      158,825      254,608   224,425   240,000                     258,315        250,020


          
              Ministry of Agriculture and Agrarian Reformation
          
              Central Bureau of Statistics.
                                                             176
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Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




              Gap between demand and supply:
               The above mentioned data of the supply and demand shows an explicit gap in favor
               of the demand estimated at 207,289 tons of urea fertilizer (95,353 azotic elements).
               This gap is covered by importation. Therefore, the studied project will exploit this
               chance by increasing the local production of this strategic commodity.

              Competition & competitors:
               The local production of ammonia is limited to the factories of the General Company
               of Fertilizers in Homs, but it is criticized for the low quality of its products and the
               rise of its prices in comparison with the imported fertilizers, the price of one ton of
               urea fertilizer which is produced by the company is SYP 18,000, versus SYP 15,000
               per ton for the imported fertilizers. The reason is the large waste in the company and
               the leakage of gas from its old product ion lines.
               Hence, the studied factor will take the two factors of quality and price into
               consideration when it launches its products in the local market.

              Strategies of sale and distribution:
              - Local markets: 70% of the product will be distributed to the local farmers in
                  agreement with the Agricultural Bank or via agents.
              - Regional markets: 30% of the product will be exported to Iraq and Jordan via
                  agents.

              SWOT:
             a. Opportunities and points of strength:
             - The growth of the agricultural production for keeping up with demographical
               growth, which increases the demand for fertilizers.
             - The fertilizer does not leave an effect on the soil, which encourages farmers to use it.
             - The location of the project near Euphrates River secures the needed water for this
               industry.
             - The pipeline of natural gas passes next to the site of the project, which saves the
               costs of transferring it.
         b. Threats and points of weakness:
          - The abstention of some farmers from using chemical fertilizers.
          - Not abiding by the recommended rates of fertilizer for each kind of pant.
          - The rise of the rate of biuret in the urea during the interaction of carbon dioxide and
             ammonia. This substance causes allergy to some plants

              Revenues of project:
               The project will operate at a daily estimated production capacity of 1000 tons; i.e.
               300,000tons during 300 workdays. Considering the price of one ton is SYP 13,000
               (competitive wholesale price), the annual revenues will be SYP 3,900,000,000.
                                                       177
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          Second: Technical Study:
          Technical description of project:
         a. Location: Deir Ezzor governorate is best suited for this
            type of projects for its closeness to the sources of the
            materials needed for the manufacturing process
            (Euphrates water and the gas pipeline which pass through
            it), in addition to its closeness to the fertilizer selling
            markets which are situated in the eastern zone (Syria
            agricultural tank).

         b. Land and Building: (SYP 100,000,000)
            The project needs 50 dunams (50,000 m2) in a nearby area from Euphrates River.
            Most often, a piece of land of the public property will be leased. The leasing of the
            land will be treated in the operating costs. In addition, the project needs a building,
            storehouses and hangars at a value of 8,000 m2 at a value of SYP 100,000,000. The
            building contains the management, laboratory, control room and safety system,
            maintenance workshop, storehouse, fire extinguishing equipment, ecological control
            system, liquid waste and gaseous emissions treatment, ammonia production unit,
            sulfur acid production section and others.

         c. Machinery and equipment: (SYP 10,900,000,000 of a west European origin).
            The factory of ammonia fertilizer is in need of a natural
            gas feeding line, a cooling and desalination line linked
            with a canal from Euphrates River. The factory contains
            the following machines:
             - Machines of producing carbon dioxide.
             - Machines of activating ions exchanges
             - Machines of azot with a special chimney.
             - Machines of ammonia with a special oven.
             - Boilers for generating ammonia and urea steam.
             - A condenser in the ammonia section and another one in the urea section.
             - Mills for grinding dolomite limestone
             - Processor of limestone and basins of layerage.
             - A special electricity generator for draining water.
             - Control panels and waste treatment systems for liquid and gas.
             - Machines for packing, sealing and printing.
             - Systems and engineering technologies for treating liquid and gaseous waste,
                 estimated at 1.5 billion Syrian pounds.




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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




         d. Means of transportation (SYP 36,000,000): tankers for loading liquid materials
            (ammonia), trucks loading 5 tons, forklifts, buses for transporting workers,
            ambulance. …

         e. Furniture and furnishing: (SYP 2,000,000): office equipments, computers, various
             equipments.
         f. Expenses of incorporation and licenses (SYP 300,000,000): engineering and
             economic studies. Installing and running machines.
         g. Commodity requirements: (SYP 1,200,000,000).
            - Raw materials: (natural gas, limestone, sulfur, various chemical substances,
                packing and packaging materials): SYP 940,000,000. Out of which is natural gas
                at a value of SYP 691,200,000.
                The value of one cubic meter of natural gas is SYP 8 (it is different from the
                household gas). It is subsidized for the factories of fertilizers.
            - Other commodity requirements (leasing the land, industrial electricity, water for
                cooling): SYP 260,000,000.
         h. Service requirements: 90,000,000 (maintenance expenses (15) million,/35 million
             expenses of researches and experiments/ 30 million expense of advertisement,
             promotion, participation in specialized internal and external exhibitions/ 10 millions
             other expenses.

         i. Administrative structure - salaries and wages:
            The administrative and organizational structure of the project consists of:
            - Production department: It is responsible for the production process, in addition to
               examining the final product.
            - Administrative and legal department: It is responsible for running the
               administrative affairs, correspondence, archive and organizing contracts.
            - Marketing and sales department: It is responsible for observing and studying the
               motion of the market, drawing up future work plans, required development plans,
               supervising promotion, sales and distribution.
            - Financial department: It is responsible for the processes of sales, purchases,
               organizing revenues and expenses, preparing the financial budgets of the project.
            - Human resources department: It is responsible for attracting and recruiting the
               required employment, developing their experiences and skills, organizing their
               affairs.
            The employment needed for the project is estimated at 350 workers with one shift,
            distributed to 310 technicians and production, 40 administrative officials. The total
            cost of salaries and wages, including social insurances, is estimated at SYP
            105,000,000.



                                                    179
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          Third: Financial Study:
           Estimation of investment costs:
           - Fixed capital: SYP 11,338,000,000.
           - Working capital: SYP 462,000,000.

           Estimation of annual operating costs:
           - Commodity requirements (supplies): SYP 1,200,000,000.
           - Service requirements: SYP 90,000,000.
           - Wages and employment: SYP 105,000,000.
           - Depreciations: SYP: 1,162,600,000.
          Variable costs are estimated at SYP 1,314,000,000 and fixed costs are estimated at SYP
          1,243,600,000.

           Economic and financial analysis of project:
          - Total costs = SYP 11,800,000,000.
          - Value of annual revenues = (the average lifetime of the project is 10 years + 2 year
              of establishment) = SYP 3,725,761,000.
          - Total annual costs (the average lifetime of the project is 10 years + 2 years of
              establishment) = SYP 2,291,628,000.
          Notice: Revenues and costs are raised 3% during the production lifetime of the project.

            Economic parameters of project:
              a. Annual gross profits                            = SYP 2,596,733,000
              b. Net profits                                     = SYP 1,434,133,000
              c. Pay-back period                                 = 6.2 years (including
              d. Rate of return of capital (investment)          = 25%
              e. Net present value at a discount rate of 15% = SYP 843,882,869
              f. Break-even point                                = 50% = SYP 1,862,882,000.
              g. Internal rate of return                         = 16.8%
              h. Added value                                    = SYP 2,700,000,000.
             The project is largely sensitive towards the change of its capital. If the investment
             costs decrease at a rate of 20 %, the internal rate of return rises to 21.8%.

             Most important required permits:
             - Licensing under law No. /8/ Syrian Investment Agency.
             - The approval of the General Establishment of Chemical Industries.
             - The approval of the Ministry of Petroleum to provide the project with gas.
             - Industrial permit / Ministry of Industry.
             - Administrative permit / Deir Ezzor Governorate – Technical Services
             - Ecological consent / Deir Ezzor Governorate – Directorate of Environment.


                                                    180
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                                A Summary of a Feasibility Study
                             A Factory for Producing Artificial Sponge
                             Deir Ezzor Governorate / Industrial City

           About the project:
            The project is listed under the chemical industries
            whose aim is to establish a factory for producing all
            different kinds of sponge. There is a strong need for
            this project because it is a raw material serving many
            industries such as household furniture, and car
            furniture in accordance with the conditions of good
            quality.

              The project will be built in Deir Ezzor, the industrial City for being near from the
              sites of exportation/Iraq.

              This summary of the feasibility study includes: marketing study, technical study
              and financial study.

          First: Marketing Study:
             Product & quality:
              The project tends to the different kinds of the sponge industry: ordinary, pressed
              extra and pressed supper, depending on the suitable polyurethane which satisfies all
              needs and use the latest technologies according to the world quality specifications.
             The demand:
              The average annual consumption per capita is nearly estimated at 0.3 m3 which
              equals 6,259,800 m3 per year. This demand increases at a rate of 2.4% per year due
              to the increase of population, and at a rate of 0.2% because of the development of
              the uses of sponge. Yet we should take into consideration that 40% of the people
              are still using wool mattresses and sometimes cotton mattresses.

             The study of supply:
              Syria produces sponge locally, but it imports parts of its need from other countries.
              With the increase of the number of inhabitants and the development in the use of
              sponge, there appeared an increasing need for this product to cover the increase of
              the demand which reached 2.6%, in addition to the demand from Iraq.

             Competition & competitors:
               - There are 25 factories for manufacturing sponge. The most important of which
                 are:
               - Al-Sadi Company (Damascus)
               - The Syrian Company for Sponge Industry
               - Sbaei Company for songe.
               - Al-Attar Company (Damascus).
                                                    181
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




             Strategies of sale and distribution:
              - Local markets: (Damascus, Aleppo) at a rate of 40% because the largest
                 numbers of inhabitants live in these two cities.
              - Regional markets: (Iraq, Lebanon) at a rate of 60% of the product.

           SWOT:
          a. Opportunities and points of strength:
          - The possibility of exportation is strongly opened to the Arab nearby countries,
             especially Iraq.
          - The increasing demand for the product which gets in line with the increase of
             population.
          b. Threats and points of weakness:
          - Some people still prefer natural wool.
          - The industry of furniture which is considered the first consumer suffers from
             stagnancy.

             Revenues of the project: SYP 124,000,000.
              The annual production capacity of the project is estimated at 30,000 m3 divided into
              12,000 m3 to the local markets with a price of nearly SYP 4,000 per one meter and
              18,000 m3 for the external markets at a price of SYP 4,220 per one meter.
              Accordingly, revenues will be SYP 124,000,000.

          Second: Technical Study:
             Technical description of the project:
              a. Location: Deir Ezzor /the industrial city/ in
                 order to make use of the new infrastructure, in
                 addition to being near from the Iraqi border
                 which facilitates the process of exportation.

              b. Land & Building (SYP 60,000,000)
              The factory will be built on a piece of land of no less than 5 donums at a value of 5
              million Syrian pounds. And the building with its storehouses and administrative
              and service facilities will be performed according to an internal chart fit to the
              positions of the machines and fit to get raw materials in and get the ready product
              out, at a value of SYP 55,000,000.

              c. Machinery and equipment: (SYP 68,000,000
                 of west-European origin)
                 The production line consists of the following
                 section:
                  - Section of receiving raw materials.
                  - Section of simple supplies

                                                    182
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                  -  Section of shaping ordinary sponge.
                  -  Section of shaping pressed sponge
                  -  Section of pressing and producing pressed sponge.
                  -  Section of drying and cooling.
                  -  Section of cutting: It includes (vertical cutters, horizontal cutters, special
                     cutters for cutting according to different shapes and different sizes.
                  - Section of the conveyer.
                  - Monitoring system.
               d. Means of transportation (SYP 9,300,000).
               e. Furniture and furnishings: (SYP 900,000 ).
               f. Expenses of incorporation and permits (SYP 6,800,000).

               g. Commodity requirements (supplies): (SYP 65,000,000).
                 -Raw materials: (polyurethane and polyretan: SYP 53,000,000.
                 -Other commodity requirements (electricity, water, fuel): SYP 12,000,000.

               h. Service requirements: (maintenance, mail, telephone, advertisement,
                   promotion,…) : SYP 10,000,000.
               i. The organizational structure, salaries and wages:
                   The organizational structure of the project consists of:
                  - Production department: It is responsible for all stages of the production
                      process, in addition to the laboratory and controlling quality.
                  - Promotion and sales department: It is responsible for advertisement and
                      promotion.
                  - Human resources and finance department: It comprises the financial
                      directorate, directorate of personal affairs, drivers and workers.

                  The employment needed for the project is estimated at 54 workers with two
                  shifts, distributed to 14 administrative officials, 40 technicians, specialized
                  workers, maintenance, and guards. The total cost of salaries and wages,
                  including social insurances, is estimated at SYP 14,000,000.

          Third: Financial Study:
                Investment costs are estimated as follows:
               - Fixed capital: SYP 145,000,000.
               - Working capital: SYP 15,000,000.

              Annual operating costs are estimated as follows:
              - Commodity requirements: SYP 65,000,000.
              - Service requirements: SYP 10,000,000.
              - Wages and employment: SYP 14,000,000.

                                                    183
                                                                                                                
Investment Opportunities Guide
                                                                                                               Beat Al khebrah
                                                                                                                             Syria 2011
                                                                                                      Consulting & Studies of Economic
                                                                                




              -      Depreciations: SYP 12,950,000.

                  Variable costs are estimated at SYP 78,600,000 and fixed costs are estimated at
                  SYP 23,350,000.

              Economic analysis of the project:
              - Total investment costs     = SYP 160,000,000.
              - Value of annual revenues = (the average lifetime of the project is 10 years) =
                 SYP 155,966,000.
              - Total annual costs (the average lifetime of the project is 10 years)
                 = SYR 122,212,000.

                  Notice: Revenues and costs are raised 5% during the production lifetime of the
                  project.

                 Economic parameters of the project:
                   a. Annual gross profits                         = SYP 46,7034,000.
                   b. Net profits                                  = SYP 33,754,000.
                   c. Pay-back period                              = 3.4 years
                   d. Rate of return of capital (investment)       = 29%
                   e. Net present value at a discount rate of 15% = SYP 80,052,705.
                   f. Break-even point                              = 41%
                   g. Internal rate of return                       = 23.2%
                   h. Added value                                   = SYP 59,000,000.

                  The project is largely sensitive towards the rise of its variable costs at a rate of 10%
                  where the internal rate of return decreases to 16.7%.

              Most important required permits:
              - Industrial permit
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allotment
              - Building license
              - Administrative permit and ecological consent.

                  The industrial cities include the service of the one stop shop, which provides all
                  these permits.




                                                         184
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                                A Summary of a Feasibility Study
               A Factory of Producing Plastic Pipes and Accessories for Transporting
               Drinking Water In Aleppo Governorate/ Industrial City, Sheikh Najjar/

           About the project:
            The project is listed under the projects of
            chemical industries. It aims at producing
            plastic pipes of 20 to 63 mm and their
            accessories, with a productive capacity of 2000
            tons per year in Al-Shekh Najjar Industrial
            City. These pipes are used for both, conveying
            drinking water and heating nets. The products
            shall be manufactured from polypropylene
            (Random) according to world standards and specifications.

              This summary includes: marketing study, technical study and financial study.

          First: Marketing Study:
             Product & quality:
              The project will produce plastic pipes and accessories from polypropylene
              (Random) that used to transport drinking water and in central heating networks.
              This substance is hygienic, that it doesn’t cause any change in taste, smell or color
              of water, and it is not affected by acids and highly resistant against shocks and
              pressure, resistant to calcification and oxidation and impermeable to ultraviolet
              rays, with a long-term virtual age (50 years).

             Study of demand:
              Demand for plastic pipes and their accessories arises from house owners, craft
              owners (plumber), contractors and engineers. Throughout the field searching, it has
              been observed that a big decline in demand for metal pipes in plumbing tools
              market and an increase in demand for plastic pipes. That due to its low price
              comparing with metal pipes (coated), in addition to easy installation and low costs
              of transport and customs. The estimated domestic demand for plastic pipes is about
              30,000 tons per year, or about 11 kg of plastic pipes and accessories per household
              (3.9 million households), for use in cladding (Interior plumbing), heating systems
              or periodic maintenance of drinking water systems and heating. The study based on
              household consumption of 70% plastic tubes and 30% metal.

             Study of supply:
              Based on the study of domestic imported supplies of plastic pipes and the field
              study about productivity of the companies, the estimated annual production in Syria
              is about 28,000 tons of which 7,000 tons exported to Iraq, Jordan and Gulf States
              and others . The domestic market importing 4719 tons of plastic pipes from Turkey
              and other countries according to 2009 figures of the Central Bureau of Statistics.


                                                    185
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




             Gap between supply and demand:
              According to the study of supply and demand, we find that there is an obvious gap
              in domestic market estimated at about 4000 tons annually, in addition to the
              possibility of an increase in the gap as a result of increased domestic demand for
              plastic pipes and low demand for metal pipes.

             Competition and competitors:
              Competition in the domestic market of plastic pipes arises from, price-factor which
              comes first and second from quality-factor. There is a strong competition by the
              Turkish factories to Syrian products in terms of quality and exported quantities.
              This industry comprises 20 companies and workshops producing polypropylene
              pipes in Syria like (Al-Maisour, Al-Taqani, Al-Fattal, Saad…), including 6 in the
              governorate of Damascus, 4 in Aleppo, 2 in Hama, 2 in Homs and 6 in the other
              governorates.

             Strategies of sale and distribution:
              The project will meet part of the need of the Syrian market, and export the
              remaining part to the neighboring countries, especially the Iraqi market, which
              imports pipes for drinking water in large quantities. The project will carry out large
              advertising campaigns through participation in specialized fairs, granting gifts and
              giving discounts on the amount of sales to contractors and engineers, in order to
              build strong business relationships with them.

           (SWOT):
          a. Opportunities and points of Strengths:
             - The growing demand for plastic pipes instead of metal pipes.
             - The high productivity of the project compared with the local factories.

          b. Threats and weakness:
             - Fluctuation in polypropylene prices due to relevancy with global price of gas.
             - Competition by Turkish product in the local market in term of quality..

             Revenues of project:
              The project will produce 2,000 tons of different sizes of plastic pipes
              (polypropylene - Random) and accessories per year. Revenues of project estimated
              at about SYP 415 million from selling 1,250 tones, or about 1.25 million pipes at an
              average price of SYP 150 per pipe and selling 750 tons , or about 7,5 million pieces
              (elbow, T-linkage, joint ..) at an average price of SYP 30 per piece.

          Second: Technical study:
           a. Location: The project will be established in Al-Shekh Najjar Industrial City of
              Aleppo Governorate. The project will supply through this location the plumbing
              market of Aleppo Governorate with its products, as well as markets of the Eastern
              Governorates, Iraq and other countries.


                                                    186
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




           b. Land &Building: SYP ( 47) million
              The Project will be established on a land of a total area of about 4 donums, and a
              value of about SYP 8 millions. The building comprises the administrational
              department, and the production department which includes machinery and
              equipment, in addition to the warehouses of raw materials and finished products,
              and a center for quality testing and public utilities of the buildings. The estimated
              cost of construction is about SYP 39 millions.

           c. Equipment of the project and the production process: (SYP 82 millions for
              Western European origin)
              The equipments of the project consist of two production lines, a drawing line that
              used for the manufacture of plastic pipes, and an injection line with molds used for
              the manufacture of accessories. The project installations also include laboratory of
              quality, packaging and packing machine, an electric generator and electrical
              transformer..,

              The environmental impact of the project:
              The project’s environmental study shows, that some harmful gases are emitted as a
              result of melting the polypropylene substance and transforming it into pipes and
              accessories, therefore the management of the project intends to install refining
              filters, which in turn will reduce the emission of volatile gases.

           d. Productive and service transportation means: SYP (3) million.
              It consists of two trucks to transport raw materials and finished products, in
              addition to a car for service and a forklift.

           e. Furniture and furnishings: SYP (200) thousand.
              It consists of office equipments for administrative offices, tables and chairs,
              computers and anti-outage units, and electrical equipments ..,.

           f. The expenses of incorporation and licenses: SYP (3.8) million .
              It includes the cost of engineering studies, cost of the feasibility study and
              administrative costs such as fees and licensing .., in addition to the cost of the
              remuneration of the study supervisors and machinery installation.

           g. Commodity supplies: SYP (305) million.
            - Raw materials: SYP 300 million.
              Consisting of polypropylene granules (Random), pigment for the granules, and
              metal parts for accessories. The polypropylene (Random) substance is used because
              of its distinction as highly resistant to heat and chemicals. This substance is secured
              from SABIC or by local suppliers. Metal parts are also secured from local factories
              specialized in metal industries. Estimated quantity of polypropylene is 2,000 tons
              per year at a cost of SYP 120 thousand for each ton, where 27% of the total plastic
              parts are manufactured with metal parts. The cost of purchasing the metal part is
              SYP 27.5, in addition to the pigment, with an estimated price of 5 million for the
              entire production.
                                                     187
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




                - Fuel and driving forces (industrial electricity, industrial fuel and water for
                    cooling): SYP 2 million .
                -Packaging and packing supplies: SYP 2 million.
                -Other commodity supplies: SYP 1 million.
           h. Service supplies (maintenance, telephone, transport and other supplies): SYP
              (20) million.

           i. Administrative structure, salaries and wages:
              The organizational and administrative structure of the project consists of the
              following departments:
               - Production and purchases department: It is responsible for the production
                   process, regarding the study of raw materials and purchasing them, supervising
                   the production process progress and testing the final product.
               - Department of financial and administrative affairs: Its tasks involve in the
                   management of the administrative matters and supervision of the personnel, as
                   well as to oversee the sales and work on analyzing them and preparation of
                   final accounts of the project.
               - Marketing and sales department: it is responsible for observance and studying
                   the market activities, drawing up future work policies, and required
                   development plans, and supervision of
                   promotion, sales and distribution operations.

               The project also comprises 25 workers (one shift),
              where the total cost of annual salaries and wages
              estimated at SYP (8.5) million including social
              security.

          Third: Financial study:
            Estimation of investment costs:
             - Fixed capital: SYP 136 million.
             - Working capital: SYP 84 million.

            Estimation of annual operating costs:
             - Commodity requirements: SYP 305 million.
             - Service requirements: SYP 20 million.
             - Wages and employment: SYP 8.5 million.
             - Depreciations: SYP 11.5 million.

              Variable costs are estimated at SYP 324,000,000 and fixed costs are estimated at
              SYP 21, 000,000.




                                                   188
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




            Economic and financial analysis of the project:
             - Total investment costs = SYP 220,000,000.
             - Value of annual revenues (the average lifetime of the project is 10 years) = SYP
                476,000,000.
             - Total annual costs (the average lifetime of the project is 10 years) = SYP
                392,000,000
             Note: Revenues and costs are increased 3% during the production lifetime of the
             project.

            Economic parameters of the project:
             a. Total annual profits                       = SYP 95 million.
             b. Net profits                                = SYP 84 million.
             c. Pay-back period                             = 2.3 years.
             d. Rate of return of capital (investment)     = 43%
             e. Net present value at a discount rate of 15% = SYP +207 million.
             f. Break-even point of the project             = 20% (95.2 million)
             g. Internal rate of return (IRR)               = 38.4%
             h. Added value                                  = SYP 110 million.

              The project is largely sensitive towards the fall of revenues where the return falls to
              15.8% in case revenues fall 10%.


            Most important required permits:
             - Industrial permit.
             - Licensing under law No. /8/ Syrian Investment
               Commission.
             - Subscription and allotment.- Building license.
             - Administrative permit and ecological consent.

              The industrial cities include the service of the one stop shop, which issues all these
              permits.




                                                     189
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                             A Summary of a Feasibility Study
             A Factory of Producing Industrial Ores Extracted from Consumed
                              and Recycled Lubrication Oils
                  In Aleppo Governorate/ Industrial City, Sheikh Najjar/

          About the project:
           This project is listed under chemical studies whose
           aim is to produce industrial raw materials extracted
           from the recycled lubricant oils, where the remains
           resulting from operating the machines, equipment and
           means of transportation are considered an important
           source of reproducing primer oil, laurel oil, remains of
           recycling and industrial lubricants needed for
           maintaining the equipments and lubricating fulcrums
           with the aim of prolonging their virtual lifetime. This
           is why the idea of recycling the remains of these oils
           emerged in order to produce primer oil, laurel oil and lubricants in a way that they
           become usable once more. The project is suggested to be built in Aleppo governorate
           / Al-Sheikh Najjar Industrial City/.

             This summary of the feasibility study includes: marketing study, technical study
             and financial study.

          First: Marketing Study:
            Product & quality:
             The importance of this project comes from recycling the remains resulting from the
             equipments and changing them into primer oil, laurels oil and lubricants needed for
             protecting the whole revolving parts of machines. This realizes the full benefit from
             the remains which some companies are obliged to get rid of via the sewage network
             causing a dangerous ecological pollution, in addition to the exorbitant costs of
             treating sewage water.

            Study of the demand:
             The demand for primer oil, laurel oil and the remains of recycling lubricants arises
             from the need of the consumers of these materials. The volume of the local market of
             these oils is estimated at 340,000 tons per year.

            Study of supply:
             The annual production of the Syrian Company for Storing and Distributing
             Petroleum is estimated at (300,000) tons of oil. Its market share is estimated at 83%
             of locally used mineral oils. It imports various kinds of oils and lubricants sold at a
             higher price than their locally produced counterparts. So far, there are no local
             projects for refining used mineral oils. This will give precedence for the project and
             realizes new added value.


                                                     190
                                                                                                              
Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




              Gap between the demand and the supply:
               This is the first project of its kind in Syria. So, it will be one of the most industrial
               projects, especially in terms of the environmental side, in addition to producing
               products needed in the market. The local production is considered insufficient.
               Therefore, the local and foreign demand is covered by importation. The project will
               recycle these oils and sell them packed in suitable small containers agreeing with the
               needs of the customer. This will generate large profits
               .
              Competition & competitors:
               The local production of primer oil, laurel oil and the
               remains of recycling lubricants are restricted to the
               Syrian Company for Storing and Distributing
               Petroleum which sells the local petroleum products.
               There is no private activity in producing or recycling
               used mineral oil, which gives a good sign of a
               brilliant future to the project because of the absence
               of competitiveness.

             Strategies of sale and distribution:
             - Local markets: All over the Syrian areas and governorates, especially Aleppo, the
               hometown of the project at a rate of 80% of the product.
             - Regional markets: (Lebanon, Jordan) at a rate of 20% due to the need of their
               market to the primer oil, laurel oil and the remains of recycling lubricants.

               SWOT:
             a. Opportunities and points of strength:
                - The availability of raw materials at very cheap prices.
                - The increasing demand for primer oil, laurel oil and the remains of recycling and
                  lubricants.
                - It is extremely an ecological project gaining a special support because it is eco-
                  friendly.
                - Exportation to the neighboring countries which do not produce such product
                  (Lebanon and Jordan).
                - The joining of Syria to the Free Arab Trade Organization, which opens new
                  prospects of exportation.
         b. Threats and points of weakness:
            - The difference of color and density in
               comparison with the new oils.
            - The competition of the present foreign brands in
               the local market.




                                                        191
                                                                                                              
Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




             Revenues of the project:
              The annual revenues of the project for producing 1200 tons of primer oils, 1200 tons
              of laurel oil and 2000 tons of the lubricants and the remains of recycling are
              estimated at s.p. 116,000,000.
              The average price of selling 1 kg of oil is s.p 40, and s.p 10 for lubricants. Products
              are filled within plastic containers of different capacities from 1 – 5 kg. Information,
              production date and expiry date and the way of use are written on the container.

        Second: Technical Study:
          Technical description of the project:
         a. Location: Sheikh Najjar city in the middle of Aleppo, where large good quantities
            are available. Advantages and exemptions given to this industrial city is benefited
            from, in addition to the fact that Aleppo is the first industrial center in Syria, and it is
            close to the markets of distribution as well.

         b. Land &Building: (s.p.16,000,000)
            The factory will be built on a piece of land of no more than 8 donums (a measure of
            land, 1000sq. m.) according to an internal design fit to the requirements of the
            process of production and the conditions of quality control with regard to the process
            of recycling used oils.
            The piece of land is estimated at s.p. 9,600,000, and the building is nearly estimated
            at s.p. 6,400,000.

         c. Machinery and equipment: (s.p. 132,000,000 of a European origin)
            The production line consists of the following:
            - Alkaline treatment unit.
            - Centrifugal unit working by the way of charges.
            - Distillation unit by the way of deflation.
            - Movable unit for infiltering oils.
            - Fixed filtering unit for oils.
            - Hand trolleys.
            - Solid basin and a crane.
            - Heating and mixing unit.
            - Other equipments.

         d.    Means of transportation (s.p. 9,000,000).
         e.    Furniture and furnishing: (s,p 1,000,000).
         f.    Expenses of incorporation and permits (s.p 3,000,000).
         g.    Commodity requirements: (s.p 49,000,000).
              - Raw materials: (remains of mineral oils, hydrazine, nitrogen, coliseum carbonates,
                 lime stones, light sulfuric acid, packing and packaging materials: s.p 42,000,000.
              - Other commodity requirements (electricity, water, fuel): s.p 7,000,000.


                                                      192
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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




         h. Service requirements:         (maintenance,     mail,   telephone,                        advertisement      and
            promotions 3,500,000.

         i. The organizational structure, salaries and wages:
            The organizational structure of the project consists of:
             - Production department: It is responsible for all stages of the production process,
             - Promotion and sales department: It is responsible for drawing up the
                 advertisement and promotional polices as well as supervising the processes of
                 distribution and selling raw materials.
             - Human resources and finance department: It comprises the financial directorate,
                 personal affairs directorate, drivers and workers.
            The employment needed for the project is estimated at 45workers with one shift,
            distributed to 4 administrative officials, 41 experts, technicians, specialized workers.
            The total cost of salaries and wages, including social insurances, is estimated at s.p.
            10,500,000.

        Third: Financial Study:
             Investment costs are estimated as follows:
             - Fixed capital: s.p 161,000.000.
             - Working capital: s.p 39,000,000.

             Annual operating costs are estimated as follows:
             - Commodity requirements: s.p.49,000,000.
             - Service requirements: s.p. 3,500,000.
             - Wages and employment: s.p. 10,500,000.
             - Depreciations: s.p: 16,120,000.
              Variable costs are estimated at s.p. 56,700,000, and fixed costs are estimated at s.p.
              22,420,000.

            Economic and financial analysis of the project:
              - Total investment costs = s.p 200,000,000.
              - Value of annual revenues = (the average lifetime of the project is 10 years) = s.p
                 145,904,000.
              - Total annual costs (the average lifetime of the project is 10 years) = SYP
                 93,737,000.
             Notice: Revenues and costs are raised 5% during the production lifetime of the
             project.

            Economic parameters of the project:
                a. Annual gross profits                                 = s.p 68,287,000
                b. Net profits                                          = s.p 52,167,000
                c. Pay-back period                                      = 2.9 years
                d. Rate of return of capital (investment)                = 34%
                                                    193
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                 e. Net present value at a discount rate of 15%          = s.p 106,623,929
                 f. Break-even point                                     = 30% (SYP 43,771,200)
                 g. Internal rate of return                              = 28.3%
                 h. Added value                                          = s.p.67,000,000
             The project is largely sensitive towards the decrease of its revenues, where the
             internal rate of return decreases to 13.1% if revenues decrease at a rate of 20%.

            Most important required permits:
              - Industrial permit.
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allotment.
              - Building license
              - Administrative permit and ecological consent.
             The industrial cities include the service of the one stop shop, which provides all these
             permits.




                                                     194
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                                   A Summary of a Feasibility Study
               A Factory of producing raw materials for artificial detergents (sulfonic acid)
                   In Aleppo Governorate/ Industrial City, Sheikh Najjar/

           About the project:
            The project is listed under the projects of chemical
            industry. It aims at producing raw materials for
            different forms of artificial detergents of a high
            quality, then supplying them to the factories of
            detergents.

              There is a large need for this project on the level
              of Syria, because only a very little rate of the need of the factories is locally
              produced.
              This summary includes: marketing study, technical study, financial study.

           First: Marketing Stud:y
             Product & quality:
              The raw materials of artificial detergents are produced in little quantities, but with a
              large activity giving the industry of Syrian detergents a competitive status. This
              feature helped Syria enter the nearby markets with a distinguished strength. The
              most important specifications of sulforic acid:
              - Sulfonic acid % 96 min
              - Free oil         % 1.5 max
              - Sulfuric acid     % 1.5 max
              - Color          (Klett) 35 max

             Study of demand:
              The demand for the raw materials of artificial detergents arises from the factories
              which produce these detergents. There are 535 factories and workshops with a
              theoretical production capacity of 350 thousand tons. The actual current production
              capacity is 220 thousand tons. This quantity needs about 3 million tons of sulfonic
              acid (one ton of artificial detergent needs 14 tons of acid).

             Study of supply:
              There are two factories in Syria producing raw materials for artificial detergents at
              a production capacity of 21,620 tons per year, in addition to the production of the
              companies of the public sector.

             Gap between demand supply:
              There is a clear gap between the demand and the supply, where the currently
              produced quantities of sulfonic acid do not exceed 1% of the need of the market.



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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




              Competition & competitors:
               The competition in the Syrian market is restricted to two producers of the raw
               materials of artificial detergents: Da'aboul and Sadat for sulfochemicals. They work
               at a production capacity of 7,620 tons per year, and the Syrian Company for
               Chemical Industries which work at a production capacity of 14,000 tons per year.

              Strategies of sale and distribution:
              - Local markets: at a rate of 70% of the production. The local need is large and it
                  must be met.
              - Regional and international markets: (Gulf States, Iraq, Turkey, the European
                  Union, Rassia, China) at a rate of 20% of the production. The Syrian product has
                  a very good market share in these markets.

              SWOT:
              a. Opportunities and points of strength:
                - The weakness of competition and the existence of a large market share
                  available for the investment.
                - The increasing demand for the products of the project for being a raw material
                  for various industries.
                - The accession of Syria to the Free Arab Trade Zone and the preparations for
                  joining the International Trade Organization, which opens new prospects.

          b. Threats and points of weakness:
             - The need for certain experiences and qualified staff.
             - The health risks which may result from dealing with chemical compounds.

              Revenues of project:
               The annual revenues of the project for producing 10,000 tons of sulfonic acid are
               estimated at SYP 375,000,000. The price of one ton is SYP 37,500 on average.

          Second: Technical Study:

           Technical description of project:
          a. Location: The industrial city in Sheikh Al-Najjar – Allepo
             governorate. It is 4,412 hectares, 15 km far from the centre
             of the city. Many industrial and economic activities are
             licensed according to clear and studied charts.
          b. Land: SYP 4,000,000
             The project will be built on a piece of land of no less than2 dunams (2,000
             sq.meter).
          c. Building: (SYP 21,000,000).
             The factory will be built on a piece of land of 700 m2 according to an internal chart
             fit to the requirements of production process and the special unit of laboratories.
                                                    196
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Investment Opportunities Guide
                                                                                                                                 Beat Al khebrah
                                                                                                                                               Syria 2011
                                                                                                            Consulting & Studies of Economic
                                                                                      




          d. Machinery and equipment: (SYP 60,000,000 of west European origin)
             The project consists of an integrated production line for the main stages of
             production:
             - Machines of compressing and drying air.
             - Machines of melting and pumping sulfur (melting tanks, steam boiler, a pump
                 of liquid sulfur.
             - Machines of producing sulfur dioxide and sulfur trioxide.
             - Reactors and final production.
             - Unit of automatic packing (packing and packaging with its accessories)
             - Other equipments.




                        Exhaust Gases From
                         Sulphonic Plant




                                                                                                                Absorbtion
                                                                                                                 Tower

                                                               Filter
                                                                                                                     Oleum From
                                                                                                                     Sulphonic Plant




                                                              Water




                                  LAB

                                                          NaOH
                                                         Solution
                                                          Tank


                                         LAB    to
                                        Sulphonation
                                          Process                         Exhaust Gas Treatment
                                                                             PFD




          e.   Means of transportation (SYP 7,000,000 )
          f.   Furniture and furnishing: (SYP 500,000).
          g.   Expenses of incorporation and licenses (SYP5, 500,000).
          h.   Commodity requirements: (SYP 315,000,000).
          -    Raw materials: (sulfur, caustic soda, packing and packaging materials, …) : SYP
               309,000,000

               Feed materials consumption per ton of sulfonic acid:
                 -    LAB with M.W. 245                (kg)         730
                 -    Sulfur                           (kg)     101
          -    Other commodity requirements (electricity, water, fuel): SYP 6,000,000.

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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          i. Service requirements: ((maintenance,             mail,   telephone,                      advertisement,
             promotion,…: SYP 5,000,000).

          j. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:
             - Production department: It is responsible for the production process, in addition
                 to the laboratory and quality.
             - Purchases and sales department: It is responsible for drawing up the
                 advertisement and promotional polices as well as supervising the processes of
                 supplying raw materials with the best prices and the best levels of quality.
             - Human resources and finance department: It comprises the financial
                 directorate, personal affairs directorate, drivers and workers.

              The employment needed is 25 workers with one shift, distributed to 4
              administrative officials, 5 experts, 16 technicians, production, maintenance, guards.
              The total cost of salaries and wages, including social insurances, is estimated at
              SYP 8,000,000.

          Third: Financial Study:
              Estimation of investment costs:
              - Fixed capital: SYP 98,000,000
              - Working capital: SYP 88,000,000.

              Estimation of annual operating costs:
              - Commodity requirements (supplies): SYP 315,000,000
              - Service requirements: SYP 5,000,000
              - Wages and employment: SYP 8,000,000.
              - Depreciations: SYP: 9,650,000.
              Variable costs are estimated at SYP 322,200,000, and fixed costs are estimated at
              SYP 15,450,000.

              Economic and financial analysis of project:
              - Total investment costs = SYP 186,000,000.
              - Value of annual revenues = (the average lifetime of the project is 10 years) =
                 SYP 471,671,000.
              - Total annual costs (the average lifetime of the project is 10 years) =
                 SYP 420,710,000

              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project (10 years).


                                                    198
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




             Economic parameters of project:
              a. Annual gross profits                              = SYP 60,611,000
              b. Net profits                                       = SYP 50,961,000
              c. Pay-back period                                   = 3.1years
              d. Rate of return of capital (investment)            = 33%
              e. Net present value at a discount rate of 15%       = SYP 87,215,968
              f. Break-even point                                   = 23% = SYP 108,484,330
              g. Internal rate of return                           = 26.8%
              h. Added value                                       = SYP 60,000,000

              The project is largely sensitive towards the rise of its costs, where the internal rate
              of return decreases to 1.3% in case the variable costs increase 10%.

             Most important required permits:
              - Industrial permit
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allotment
              - Building license.
              - Administrative permit and Ecological consent

              The industrial cities include the service of the one stop shop, which provides all
              these permits.




                                                     199
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                               A Summary of a Feasibility Study
                                 A Factory of MDF Wood
                    In Aleppo Governorate/ Industrial City, Sheikh Najjar/
           About the project:
            The project consists of an integrated production line for
            producing MDF wood from the sawdust and fractions of
            wood, natural remains of farmers and crops in a way
            that fits the requirements of the general demand. About
            20% of the product will be exported outside the country.
            Wood markets in Aleppo are the most popular ones in
            Syria, especially with the existence of many factories
            which integrate with this industry.
             This project is considered necessary because of the growing demand for the product
             which gets in parallel with the increase of the population and wood industries,
             especially those which are used in residential buildings (finishing works – furniture).
          First: Marketing Study
            Product & quality:
              The project will offer a high quality product of
              MDF wood with a light weight and fit to the
              different needs. It will be formed according to
              latest technologies.
              The project is featured by being eco-friendly,
              because it depends on the remains and residues
              of wood. The general approach is to develop
              this industry for its role in realizing a surplus
              and preserving the natural resources of wood.
              The project aims at producing compressed wood plates with typical thicknesses, 16
              mm – 18 mm. 22 mm and standard measures, 1220 mm X 2440 mm, in addition to
              other measures requested in the market, or upon the client's request. It is to be noted
              that the project may produce any other measures up to 1250 mm X 2500 mm.
              A wood plate of 1220 X 2240 X 16 mm needs 20 kg of ground wood, in addition to
              a quantity of linking materials weighing 7 kg – 8 kg.

            Study of demand:
             The annual need of the Syrian market of compressed wood (MDF) is approximately
             estimated at 40500 tons. This demand increases at a rate of 0.2.4% per year with the
             increase of the inhabitants and at a rate of 0.3% in comparison with the
             development of the uses of wood.

            Study of supply:
             Syria imports more than its need of MDF from Europe (Italy, Romania, Poland,
             Spain, Portugal, England …,), in addition to South America (Brazil, Argentina, and
             Chili), and from an Asian origin (Malaysia, Indonesia, Thailand and Chine). Only a

                                                     200
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




              small quantity is locally covered because of the increasing demand for these
              materials.

            Gap between demand supply:
             A rate of 50% of the imported compressed wood (MDF) is practically considered a
             gap, because it is not locally produced. The gap is also a result of the incapability of
             the local production to cover the increasing and continuous demand which
             accompanies the development of the inhabitants and the development of the uses of
             MDF, where there appears a need for increasing the supply to be able to cover the
             annual rate of 2.7% of the demand.

            Competition & competitors:
             The strongest competitor in Syria is the General Establishment of Match and
             Compressed Wood which produces 450 m3 per year. But this establishment is not
             only specialized in compressed wood. So, its production capacity is low.
             There are a few factories of compressed wood in Syria, but they are not specialized
             and their production capacity is too weak.

            Strategies of sale and distribution:
             - 80% of the product will be marketed locally.
             - 20% will be exported to the regional and international markets to get a return of
                foreign currency.

            SWOT:
            a. Opportunities and points of strength:
             - The increasing demand for the product which is accompanied with the increase
                of the population and the extension of the field where wood is used.
             - The inexistence of a local strong product in the market.
             - The need of the neighboring market to the product proves the necessity of
                exportation.

            b. Threats and points of weakness:
             - The competition of the foreign products which are imported from European,
                Asian and American countries (competition in quality and prices).
             - The current relative stagnancy of the industry of furniture which is the largest
                consumer of MDF.

            Revenues of project:
             Marketing product         Qty              Unit    Price      Total/SYP
             Locally         MDF                         M2
                                        240,000                 SYP 700       SYP 168,000,000
                             plates
             exportation                 60,000            M2    $16.0         SYP 44,160,000
                                    Sum total                                 SYP 212,160,000

                                                     201
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




          Second: Technical Study
            Technical description of project:
             a. Location: Aleppo/ Sheikh Najjar. Aleppo is distinguished by being the most
                active market of wood in Syria.

              b. Land and Building: (SYP 80,000,000)
                 The project will be built on a piece of land of no less than 10,000 m2 fit to the
                 need of the project at a value of SYP 20,000,000.
                 The building will be built according to an internal chart fit to the requirements of
                 the production process, the conditions of the relevant controlling quality of the
                 project, in addition to storing, at a value of SYP 60,000,000.

              c. Machinery and equipment: (SYP 83,000,000 of a west-European origin)
              The production line consists of the following:
                 - Section of receiving sawdust and the remains of wood industries.
                 - Section of grinding, mincing and gathering dust.
                 - Section of drying.
                 - Section of receiving linking materials.
                 - Section of kneading.
                 - Section of forming and compressing.
                 - Section of drying.
                 - Section of cutting and final formation.
                 - Monitoring system

              d.Means of transportation (SYP 10,000,000 ).
              e.Furniture and furnishing: (SYP1, 500,000).
              f.Expenses of incorporation and licenses (SYP 7,500,000).
              g.Commodity requirements: (SYP 120,000,000).
              - Raw materials: (wood, sawdust, adhesive materials, and supplementary
                materials): SYP 108,000,000.
              - Other commodity requirements (electricity, water, fuel): SYP 12,000,000
              - Service requirements: ((maintenance, mail, telephone, advertisement,
                promotion,…) SYP 8,000,000.

              h. Administrative structure - salaries and wages:
               The administrative and organizational structure of the project consists of:
               - Production department: It is responsible for all stages of the production
                   process, in addition to the laboratory and quality.
               - Promotion and sales department: It is responsible for drawing up the
                   advertisement and promotional polices, as well as supervising the processes
                   of distribution and sales.


                                                     202
                                                                                                               
Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




               -      Human resources and finance department: It comprises the financial
                      directorate, personal affairs directorate, drivers and workers.

                   The employment needed for the project is estimated at 54 workers with one
                   shift, distributed to 4 administrative officials, 24 experts, technicians, specialized
                   workers, and 26 ordinary and provisional workers. The total cost of salaries and
                   wages, including social insurances, is estimated at SYP 12,000,000.

          Third: Financial Study:
           Estimation of investment costs:
            - Fixed capital: SYP 182,000,000.
            - Working capital: SYP 38,000,000.
            -
           Estimation of annual operating costs:
             - Commodity requirements (supplies): SYP 120,000,000.
             - Service requirements: SYP 8,000,000.
             - Wages and employment: SYP 12,000,000.
             - Depreciations: SYP: 15,100,000.

            Variable costs are estimated at SYP 131,200,000, and fixed costs are estimated at
            SYP 23,900,000.

           Economic and financial analysis of project:
            - Total investment costs = SYP 220,000,000.
            - Value of annual revenues = (the average lifetime of the project is 10 years) =
                 SYP 266,852,000
            - Total annual costs (the average lifetime of the project is 10 years) = 188,922,000
           Notice: Revenues and costs are raised 5% during the production lifetime of the
           project.

           Economic parameters of project:
                  a. Annual gross profits                                = SYP 93,030,000.
                  b. Net profits                                         = SYP 77,930,000.
                  c. Pay-back period                                     = 2.4 years.
                  d. Rate of return of capital (investment)               = 42%.
                  e. Net present value at a discount rate of 15%          = SYP 190,834,123.
                  f. Break-even point                                     = 23% .
                  g. Internal rate of return                             = 35.7%.
                  h. Added value                                         = SYP 92,160,000.

            The project is largely sensitive towards the fall of its revenues, if they fall 20%, the
            internal rate of return will become 11.2%.


                                                        203
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




            Most important required permits:
             - Industrial permit / Ministry of Industry.
             - Licensing under law No. /8/ Syrian Investment Agency.
             - Subscription and allotment.
             - Building license.
             - Administrative permit & Ecological consent.

            The industrial cities include the service of the one stop shop, which provides all these
            permits.




                                                    204
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                            A Summary of a Feasibility Study
                 A Factory of Producing Resins of acrylonitrile- Butadiene
                            Styrene (ABC) Idlib Governorate

           About the project:
            The project is listed under the projects of chemical
            projects. It aims at producing resins of acrylonitrile -
            Butadiene Styrene in the form of commodity products.
            These substances enter in a large number of commodity
            products like artificial rubber, plastic materials, lighted
            signals, contact lenses, dentures, medical equipments,
            sample and specimen preservers, the components of
            furniture, carpets, bulbs of trains and vehicles. They can also be marketed in the
            form of balls or granules or plates. Due to the high importance of these products in
            many industries, they are best sold. It is suggested to build the project in Edleb
            governorate where the raw materials of this industry are available.
            This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
             Product & quality:
          -   Acrylonitrile & Butadiene: These materials are given to the artificial rubber. They
              are used in the industry of paints, adhesives materials,paper, leather, artificial
              paving stone, and plastic materials.
          -   Styrene: It is a chemical organic compound basically manufactured for oil by the
              process of dehydrogenation from the raw (ethyl benzene). It is used in the industry
              of school and household devices, food containers, artificial containers, kids' toys,
              packing disposable food dishes and many other industries of light weight.

             Study of demand:
              The demand for the products of this project arises from their
              wide uses in many industries. These materials are not
              locally produced. The annual volume of the local market is
              nearly estimated at 24500 tons.

             Study of supply:
              The importance of this project becomes clear in being the first of its kind in Syria.
              There is no local production, and all the needs of the market are imported.




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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




              Gap between demand supply:
               Day by day, the demand for these materials is increasing, because they form
               essential materials and a basis for some industries and craftsmanship. The needs of
               the market were 24000 tons in 2005 and 24500 tons in 2010. These needs are still
               growing continuously. This will generate large profits.

              Competition & competitors:
               There is no local competition. The competition is restricted to the imported
               products which are featured by their high prices which always increase for being
               demanded.

              Strategies of sale and distribution:
          -    Local markets: At a rate of 65% of the production.
          -    Regional markets: The nearby markets at a rate of 35% of the production.
          -    International market: There will be no exportation to the international market.

              SWOT:
          a.   Opportunities and points of strength:
          -    The increasing demand for the "resins of acrylonitrile- Butadiene Styrene".
          -    The lack of a local production, which supports its success.
          -    Exportation to the neighboring markets.
          -    The accession of Syria to the Free Arab Trade Zone, which opens new areas of
               exportation.

          b. Threats and points of weakness:
          - The world fluctuations of the prices of raw materials.
          - The competition of the existing brands in the market.

              Revenues of project:
               The annual revenues of the project for producing 10,000 tons of the commodity
               products, in addition to the revenues of 10,000 tons of the specialized commodity
               (the total production: 20000 tons) will be 1,000,000,000. The price of one tons is
               SYP 50,000 on average.

          Second: Technical Study:
           Technical description of project:
           a. Location: Edlib governorate, where pine
              trees are available in the governorate and in
              the nearby areas. Resin is extracted from the
              trunk of the tree, and because it is near form
              Aleppo, the first industrial city in Syria.

                                                    206
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          b. Land and Building: (SYP 60,000,000)
             The project will be built on a piece of land of no less than 10 dunams (10,000 sq
             meters), according to an internal chart fit to the requirements of the production
             process and the conditions of controlling quality. The land is nearly valued SYP
             8,000,000, and the building is nearly SYP 52,000,000.

          c. Machinery and equipment: (SYP 1,100,000,000 of a European origin).
             The project consists of three production lines of high technology. They are:
             - A production line of polymirization by emulsification.
             - A line of electric analysis.
             - Presses and compressors.
             - A line of cooling.
             - A line of steam
             - A line of forming moulds
             - An automatic packing unit (packing and packaging unit with its acceccories).

          d. Means of transportation / (SYP 11,000,000 )
          e. Furniture and furnishing: (SYP 2,000,000).
          f. Expenses of incorporation and licenses (SYP 17,000,000).
          g. Commodity requirements: (SYP 432,000,000).
          -  Raw materials: acrylonitrile- Butadiene, Styrene, catalyzers, packing and packaging
             materials): 390,000,000.
          - Other commodity requirements (electricity, water, fuel): SYP 42,000,000.
          h. Service requirements: ((maintenance, mail, telephone, advertisement,
             promotion,…: SYP): 20,000,000.

          i. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:
               - Production department: It is responsible for all stages of the production
                    process, in addition to the laboratory and quality.
               - Promotion and sales department: It is responsible for drawing up the
                    advertisement and promotional polices as well as supervising the processes of
                    distribution and sales.
               - Human resources and finance department: It comprises the financial
                    directorate, personal affairs directorate, drivers and workers.
             The employment needed for the project is estimated at 150 workers with one shift,
             distributed to 13 administrative officials, 137 technicians, maintenance, and guards.
             The total cost of salaries and wages, including social insurances, is estimated at
             SYP 35,000,000.

          Third: Financial Study:
           Estimation of investment costs:
           - Fixed capital: SYP 1,190,000,000
                                                   207
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




              - Working capital: SYP 170,000,000.

               Estimation of annual operating costs:
           -    Commodity requirements (supplies): SYP 432,000,000
           -    Service requirements: SYP 20,000,000.
           -    Wages and employment: SYP 35,000,000.
           -    Depreciations: SYP: 118,600,000.
                Variable costs are estimated at SYP 462,000,000, and fixed costs are estimated at
                SYP 143,600,000.

               Economic and financial analysis of project:
          -     Total investment costs = SYP 1,360,000,000.
          -     Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
                1,146,388,000.
          -     Total annual costs (the average lifetime of the project is 10 years) = SYP
                698,282,000
                Notice: Revenues are raised 3%, and costs are raised 4% during the production
                lifetime of the project.

               Economic parameters of project:
                  a. Annual gross profits                         = SYP 566,706,000
                  b. Net profits                                  = SYP 448,106,000
                  c. Pay-back period                              = 2.4 years
                  d. Rate of return of capital (investment)       =42 %
                  e. Net present value at a discount rate of 15% = SYP 1,231,583,827
                  f. Break-even point                             = 24% = SYP 275,133,000.
                  g. Internal rate of return                      = 38.1%
                  h. Added value of project                      = SYP 568,000,000
                The project is largely sensitive towards the fall of its revenues 20%, where the
                internal rate of return decreases to 20.5%.

               Most important required permits:
          -     Licensing under law No. /8/ Syrian Investment Agency.
          -     Industrial permit / Ministry of Industry.
          -     Administrative permit and Ecological consent (Edlib governorate, technical
                services).
          -     The approval of the General Establishment of Geology
          -     Approving the engineering charts from the Syndicate of Engineers.




                                                     208
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                             A Summary of a Feasibility Study
                   A Factory of producing a Rubber Mixture for Covering
                           Floors From Recycled Vehicles Tires
                                    Hama Governorate

           About the project:
            The project is listed under the chemical
            industries, where the awareness to the
            problem of the increasing quantities of used
            tires aggravates year after year. This project
            is considered one of the necessary projects
            for cleaning the environment from one of the
            sources of wastes. It is considered a
            connecting link between the series of rubber
            industries. The project aims at producing a mixture of rubber extracted from the
            recycled tires for covering the floors of playgrounds and the different kinds of
            pleasure-grounds according to the conditions of high quality. The project is featured
            by accommodating a large amount of money, and by being flexible in a way that it
            is possible to produce a different assortment of rubber granules. The project is
            suggested to be built in Hama for facilitating the process of collecting raw
            materials.
            This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
             Product & quality:
              When recycling vehicles tiers, two groups of materials are restored. The first group
              consists of the fragments of rubber (granules (2 – 30 mm). The second group is the
              iron scrap. The fragments of rubber will be re-used in paving flat areas, floors of
              recreation grounds, school floors, products used in traffic, and floors in general. As
              for iron scraps, they can be sold in scrap markets.
              Fragments can be also used in manufacturing some parts of glass wipers, protectors
              of car doors, refrigerators, ordinary and automatic washing machines and plastic
              hoses.

             Study of demand:
              The demand for the rubber mixture resulting from recycling tires arises from
              manufacturing floors of playground, recreation rooms, clubs, schools, university
              cities and hotels. It can also be added to the mixture of used asphalt in paving roads
              ….etc, in addition to exporting it to the foreign markets.
              Estimations indicate that the Syrian market is in need of 400 thousand tons of
              rubber in 2010, which makes investment in this field significant and profitable,
              especially with the availability of the raw materials, where the market generates
              about a quarter of a million tons of used tires per year. This is considered a high
              number encouraging the exploitation of this large economic mine.


                                                    209
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




              Study of supply:
               There is only one factory for recycling tires with an annual production capacity of
               2000 tons. It is committed to exporting all its production to Turkey. Syria on the
               other hand imports all its need of rubber granules from abroad. It imported in 2009
               about 378 thousand tons. The number of cars in Syria nearly counted 1,738,833.
               The following table shows the development of the number vehicles in Syria from
               2005 – 2009 according to the data of the Central Bureau of Statistics:
                      Year            2005         2006        2007        2008         2009
                 No. of vehicles    1067529 1213034          1367767 1537206 1738833

              Gap between demand supply:
               The need for recycled rubber products is increasing, and this material is
               still imported from Kuwait, Saudi Arabia for being unavailable locally.
               This proves the importance of this project in filling the gap for
               covering the local demand which is estimated at 400 thousand tons per
               year. This will generate reasonable profits to the project.

              Competition & competitors:
               The products of the project will be directed to the Syrian market for
               providing it with the rubber grounds for halls, playground, schools, and
               some kinds of factories and the projects of manufacturing raw
               materials. When these projects operate, the whole production of rubber
               will be consumed. In a later stage, the surplus will be exported. There
               is only one similar factory in Aleppo with a capacity of 2000 tons per
               year. It exports all its production to Turkey. So, it cannot be considered
               a competitor unless it directs its product to the local market as a result
               of closing the borders or for any other reason.

              Strategies of sale and distribution:
          -    Local markets: (Hama, Damascus, Damascus countryside, Homs,
               Aleppo, Lattakia), because the targeted establishments are in these
               governorates. The location of the project (Hama governorates) in the
               middle of Syria makes it easy to convey the product quickly.
          -    Regional markets: The neighboring countries at a rate of 25% of the product in
               future.

              SWOT:
          a.   Opportunities and points of strength:
          -    The availability of raw materials with cheap prices.
          -    The project is eco-friendly, because it produces useful
               products from harmful remains. In addition, the product and
               the way of manufacturing get in line with the principles of the
               United Nations of clean production.
          -    These products are featured by the possibility of recycling them again.
                                                      210
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




          -    The quality of the product (finishing works, durability, standard dimensions).
          -    Innovation in producing new products of rubber.
          -    Exportation to the nearby countries in future, especially with the accession of Syria
               the Free Arab Trade Zone, which opens new prospects.

          b. Threats and points of weakness:
          - Guaranteeing the flow of the raw materials and the difficulty of collecting them
             from all areas.

              Revenues of project:
               The annual revenues of the project for producing 3000 tons of rubber granules to be
               used in making the different kinds of grounds, in addition to the revenues of selling
               iron scrap resulting from tires (about 1000 tons), for each ton of granules are
               estimated at SYP 30,000, each ton of scrap is: 8000 = 98,000,000.

          Second: Technical Study:
              Technical description of project:
          a.   Location: Hama governorate for being situated in the middle of the country, which
               helps facilitate the process of collecting raw materials and distributing the product.

          b. Land and Building: (SYP 16,000,000)
             The factory will be built on a piece of land of no less than 10 dunams (= 10,000 m2)
             according to an internal chart fit to the requirements of the production process and
             the conditions of controlling quality. The value of the land is estimated at SYP
             8,000,000, and the value of the building is estimated at SYP 8,000,000.

          c. Machinery and equipment: (SYP 84,000,000 of a Chinese origin).
             The project consists of a main production line as follows:
          - A machine for mincing tires and sorting impurities and metals.
          - A two-horsepower hydraulic press)
          - An ejecting unit equipped with steam heater
             working by the spiral flow (two-horsepower).
          - Presses, stamps and hand tools.
          - An automatic sieve.
          - A mixer of caoutchouc ores. (A kneading machine).
          - An oven of hot air, water heater, casting moulds of
             different measures.

          d.   Means of transportation (SYP 8,000,000 )
          e.   Furniture and furnishing: (SYP 1,500,000).
          f.   Expenses of incorporation and licenses (SYP 5,500,000).
          g.   Commodity requirements: (SYP 37,000,000).

                                                     211
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          -   Raw materials (caoutchouc, used tires, synerene, natural rubber, naphtha oil, zinc,
              sulfur): SYP 32,000,000.
          - Other commodity requirements (electricity, water, fuel): SYP 5,000,000.
           h. Service requirements: (maintenance, mail, telephone, advertisement,
              promotion,…:): SYP 6,000,000.
           i. Administrative structure - salaries and wages:
              The administrative and organizational structure of the project consists of:
                - Production department: It is responsible for all stages of the production
                     process, in addition to the laboratory and quality.
                - Promotion and sales department: It is responsible for drawing up the
                     advertisement and promotional polices as well as supervising the processes of
                     distribution and sales within different halls.
                - Human resources and finance department: It comprises the financial
                     directorate, staff affairs directorate,
              The employment needed for the project is estimated at 20 workers with one shift,
              distributed to 6 administrative officials, 14 experts, technicians, maintenance,
              service …. The total cost of salaries and wages, including social insurances, is
              estimated at SYP 4,000,000.

          Third: Financial Study:
             Estimation of investment costs:
          -   Fixed capital: SYP 115,000,000
          -   Working capital: SYP 15,000,000.

             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP 37,000,000.
          -   Service requirements: SYP 6,000,000
          -   Wages and employment: SYP 4,000,000
          -   Depreciations: SYP 11,800,000.
              Variable costs are estimated at SYP 43,400,000, and fixed costs are estimated at
              SYP 15,400,000.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 130,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              112,364,000.
          -   Total annual costs (the average lifetime of the project is 10 years) =SYP
              67,507,507,000.
              Notice: Revenues are raised 3% and costs are raised 4% during the production
              lifetime of the project.



                                                    212
                                                                                                              
Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




                Economic parameters of project:
                a. Annual gross profits                                   = SYP 56,639,000
                b. Net profits                                            = SYP 44,839,000
                c. Pay-back period                                       = 2.3 years
                d. Rate of return of capital (investment)            = 44%
                e. Net present value at a discount rate of 15% = SYP 127,932,441
                f. Break-even point                                     = 26 % SYP 29,209,000
                g. Internal rate of return                             = 39.8%
                h. Added value                                          = SYP 61,000,000.
              The project is largely sensitive towards the fall of its revenues at a rate of 20%, where
              the internal rate of return decreases to 22.0%.

                Most important required permits:
          -      Licensing under law No. /8/ Syrian Investment Agency.
          -      The industrial decision/ Ministry of Industry.
          -      Administrative permit &t Ecological consent( Hama governorate– Technical
                 Services
          -      Approving the engineering charts for the Syndicate of Engineers.




                                                       213
                                                                                                             
Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                              A Summary of a Feasibility Study
                                   A Factory of Citric acid
                           Homs Governorate / Hasia Industrial City /

           About the project:
            This project is listed under the projects of the chemical
            industries. It aims at producing citric acid by
            ferminting molas (the remains of sugar beet). The
            project is suggested to be built in Homs governorate
            nexst to the factories of producing sugar, where the
            raw materials are availabel.
            It is to be noted that citric acid has many uses, and the
            full need is imported.
              This summary includes: marketing study, technical study,
              financial study.

          First: Marketing Study:
             Product & quality:
              Citrus acid consists, either of colorless or transparent crystals or in the form of
              white granules of soft powder. It can be easily and quickly solved in water and in
              alcohol. It is characterized by its hard sour taste. It is usually kept in well-tightened
              containers in dry and cold places.

             Study of demand and supply:
              The industry of citrus acid is considered one of the chemical industries in the
              developing countries, for being a main element in many transformational industries.
              60% of the world production is part of the food industries, 10% pharmaceutical
              industries and 30% chemical industries (such as leathers tanning, textile industries,
              dyes industries, inks, rust removing, mirror industry…).
              There is only one factory for manufacturing citrus acid in the KSA. It covers the
              need of the kingdom and exports the surplus. On the other hand, all Arab countries
              import this substance from Saudi Arabia, China and other countries. The imports of
              Syria of citrus acid is estimated at 11,799 tons, Egypt 45,000 tons. There are some
              small workshops producing this substance but they are ecumenically infeasible.

             Gap between demand supply:
              There is a clear gap in favor of the demand in Syria, Egypt,
              Jordan and many other countries. However, the factory of
              the KSA is unable to cover the needs of all the area, because
              the needs are continuously getting increased under the
              development of industry in all the Arab World.
              The studied project will produce citrus acid at a capacity of
              40,000 tons (a strategic project). And it will launch its
              products in the local and the neighboring Arab countries, in
              addition to the foreign courtiers.
                                                     214
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




              Strategies of sale and distribution:
              - Local markets: Either by the direct selling from the factory or by distributing via
                  representatives. The Syrian market share is estimated at 30% of the production.
              - Regional markets: (Jordan, Iraq, Lebanon) at a rate of 10% of the production.
              - International markets: (Egypt, Gulf States, Maghreb …) at a rate of 10% of
                  production.

              SWOT:
              a. Opportunities and points of strength:
                - The existence of the remains of sugar beet in the project area.
                - The production of the project will participate in covering part of the country's
                  need and the need of other Arab countries.
                - The competition is limited to one factory in Saudi Arabia.

              b. Threats and points of weakness:
               - The fluctuations of the prices of raw materials.
               - The dependence of the project on the Arab markets for distributing 70% of its
                  production.

              Revenues of project:
               The annual revenues of the project are estimated at SYP 840,000,000 at a
               production capacity of 40,000 tons. The price of one ton is SYP 21,000. It is a very
               competitive price, because the price of one ton of the imported citrus acid is SYP
               29,000.

          Second: Technical Study:
           Technical description of project:
          a. Location: The project will be built in Homs city, in
             which there is the biggest factory for manufacturing
             sugar beet in Syria. This feature will reduce the costs of
             moving molas and preserves its good quality.

          b. Land and Building: (SYP 82,500,000)
             The building will be built on a piece of land on no less than 10 dunams (10000 m2)
             at a value of SYP 7,500,000. The building will be constructed on 8000 m2
             according to an internal chart fit to the requirements of the production process and
             the conditions of controlling quality at a cost of SYP 75,000,000.

          c. Machinery and equipment: (SYP 816,000,000 of a west-European origin)
             The project comprises the following:
             - Machines of steam.
             - Rooms for the preparation of fermentation.
             - Rooms for the preparation of the nutritional setting.
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




              -   Machines of injecting germs.
              -   Machines of fermentation and detachment.
              -   Machines of precipitation.
              -   Machines of restoring acid from calcium citrates.
              -   Machines of detaching citrus acid from calcium sulfate.
              -   Machines of crystallization.
              -   Machines of packing and packaging.

          d. Means of transportation (SYP 30,000,000 )
             They comprise:
             Articulated Lorries loading 30 tons for distributing the product, small trucks
             loading 5 tons, forklifts…

          e. Furniture: (SYP1,500,000 ).
          f. Expenses of incorporation (SYP 40,000,000): engineering and economic studies,
             expenses of installation and testing.
          g. Commodity requirements: (SYP 395,000,000).
              - Raw materials: (molas, supplementary materials, sulphurous acid, ammonium
                 nitrate, water lime, methanol, phosphoric acid, formalin, active carbon,
                 cation-exchang, anion-exchange, containers for packing and packaging): SYP
                 335,000,000.
              - Other commodity requirements (electricity, water, fuel): SYP 60,000,000.
          h. Service requirements: (maintenance, mail, telephone, advertisement,
             promotion,…): SYP 35,000,000.

          i. Administrative and organizational structure:
             The administrative and organizational structure of the project consists of:
             - Promotion and sales department: It is responsible for drawing up the
                 advertisement and promotional polices as well as supervising the processes of
                 buying molas and selling citrus acid.
             - Production department: It is responsible for all the technical stages of the
                 production process by using the best technologies.
             - Human resources and finance department: It comprises the financial
                 directorate, personal affairs directorate.
             - Laboratory: It is an independent unit attached to the general manager. Its task is
                 to make sure of the quality of the products and the compatibility to the
                 standard specifications before they are marketed

              The employment needed for the project is estimated at 220 workers with one shift,
              distributed to 30 administrative officials, and the rest are technicians, production
              and maintenance workers. The total cost of salaries and wages is estimated at SYP
              49,000,000.

                                                    216
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




          Third: Financial Study:
            Estimation of investment costs:
            - Fixed capital: SYP 970,000,00
            - Working capital: SYP 318,000,000
           Estimation of annual operating costs:
            - Commodity requirements (supplies): SYP 395,000,0000
            - Service requirements: SYP 35,000,000
            - Wages and employment: SYP 48,000,000.
            - Depreciations: SYP: 99,650,000.
               Variable costs are estimated at SYP 442,200,000, and fixed costs are estimated at
               SYP 135,450,000.

              Economic and financial analysis of project:
              - Total investment costs = SYP 1,288,000,000.
              - Value of annual revenues = (the average lifetime of the project is 10 years) =
                SYP 962,966,000
              - Total annual costs (the average lifetime of the project is 10 years) =
                SYP 666,360,000.

               Notice: Revenues are raised 3% and costs are raised 4% during the production
               lifetime of the project.

              Economic parameters of project:
               a. Annual gross profits                           = SYP 396,256,000
               b. Net profits                                    = SYP 296,606,000
               c. Pay-back period                                 = 3.3 years
               d. Rate of return of capital (investment)        = 31%
               e. Net present value at a discount rate of 15%   = SYP 572,045,153
               f. Break-even point                                 =31 % = SYP 260,000,000.
               g. Internal rate of return                       = 27.6%
               h. Added value                                   = SYP 445,000,000.

              Most important required permits:
               - Licensing under law No. /8/ Syrian Investment Agency.
               - Industrial permit / Ministry of Industry.
               - Administrative permit / Governorate – Technical Services
               - Ecological consent / Governorate – Directorate of Environment




                                                     217
                                                                                                           
Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                             A Summary of a Feasibility Study
                 For a Factory of Producing Plastic Granules (Polyethylene,
                                   polypropylene, glycol)
                        Homs Governorate / Hasia Industrial City /

           About the project:
            This project is listed under the projects of the
            strategic petrochemical industries whose aim is to
            produce plastic granules (olivenites) from the gas
            of ethane and propane by building a
            petrochemical factory with a production capacity
            of 1 million tons per year compatible with the
            international specifications. The project, whose
            production capacity is small in comparison with
            the production of the international factories, will meet the need of the Syrian market
            of plastic granules and export the surplus to the Arab and foreign markets.

              The summary of the feasibility study includes: marketing study, technical study and
              financial study.
          First: Marketing Study:
           Product & quality:
              The project will manufacture high quality products competitive to the foreign
              products by producing low dense ethylene LSPE which is used in making covers of
              food and clothes, the high dense HDPE which is used in marketing sacks and bags),
              polypropylene PP for plastic threads, containers of the PET for water and foodstuff,
              mono-glycol ethylene MEG for anti-freezes, detergents, polyester paints. The
              competition of these products concentrates on three main factors: fixedness of
              colors, fixedness of standards, and that the products should be made of healthy
              unrefined materials.
             Study of demand:
              The demand for the olivenites arises from the demand for the projects of plastic,
              engineering and agricultural industries, where the imports of ethylene were nearly
              276,260 tons, polypropylene 183,214, and glycol ethylene 7,614 tons in 2009. The
              total imports were 467,088 tons per year as mentioned in the statistics of the
              Central Bureau of Statistics in 2010. On the other hand, the number of factories of
              plastic industries is nearly estimated at 125 factories which forms a large increasing
              demand for the products of the project.




                                                    218
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




              Study of supply:
               By going back to the market of petrochemical industries in Syria, we notice the lack
               of any local companies for producing plastic granules, where the local market
               depends on importing in order to meet its needs from the olivenites. For example,
               the Saudi petrochemical companies approximately cover 60% of the need of the
               Syrian market; the Kuwaiti petrochemical companies cover 10% and the rest of the
               Gulf States like the UAE, Qatar and Oman cover 30%.
              Gap between the demand and the supply:
               The gap between the demand and the local supply on the olivenites is nearly 467
               thousand tons because of the lack of local manufacturing companies. Therefore,
               setting up such a project will meet the need of the Syrian market in a competitive
               price to the foreign products, in addition to exporting the surplus to the neighboring
               countries: Lebanon, Iraq, other Arab countries, and for foreign countries which do
               not manufacture glycol.
              Competition & competitors:
               With regard to the local competition in terms of manufacturing, we notice the lack
               of local petrochemical companies which manufacture granules. The competition is
               only restricted to the local importers from the external market. On the other hand,
               the external competition is largely centered on the Saudi petrochemicals which are
               featured by their low prices and the low cost of transporting and customs charges in
               comparison with the other states. Sabk Company is considered the largest supplier
               of granules to the Syrian market. Then we can mention Petro Rabig, Kuwaiti Equit
               Company, Qabco Company of Qatar and other companies.
              Strategies of sale and distribution:
               The project will provide the need of the Syrian market form polyethylene and
               polypropylene. By manufacturing the mono glycol ethylene, it will also fully meet
               the need of the Syrian market from this product. In addition, the focus will be on
               the process of distribution to the Syrian governorates which mostly demand
               olivenite like Aleppo, Homs and Damascus where most plastic industries exist. The
               remaining part of the product will be exported to the Arab and foreign markets with
               a special concentration on the competition on glycol in terms of price and quality.

              SWOT:
          a.   Opportunities and points of strength:
          -    The inexistence of a local competition to the products of the project.
          -    The project is distinguished by its competitive production capacity on the regional
               and global level.
          -    The increasing demand for the products of the project by the factories of plastic
               industries and polymers.

                                                     219
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          -    The project is considered strategic. It will create new job opportunities and an
               added value to the domestic product.

          b.   Threats and points of weakness:
          -    The rise of its costs.
          -    Manufacturing is accompanied with harmful chemical interactions
          -    The influence of the price of raw materials.
          -    The competition of the foreign companies in the first stage.

              Revenues of the project:
               The annual revenues of the project, whose annual production capacity is
                1 million tons of polypropylene, low dense and high dense polyethylene and
               mono-glycol ethylene, are nearly SYP 89 billion on average for 20 years, where the
               average price of 1 ton of low dense ethylene is SYP 75,000, 79,000 for high dense
               ethylene, SYP 69,000 for mono-glycol ethylene and 83,000 for polypropylene,
               based on the international average price of granules when the project was studied.

          Second: Technical Study:
           Technical description of the project:
          a. Location: The project is planned to be built in Hasia Industria City in Homs,
             because it occupies a strategic important site in the middle of Syria. The Ornates
             River, which passes through it, is considered a supporting positive factor because it
             will provide the project with the needed industrial water.

          b. Land &Building: (SYP 1.25 billion)The project will be built on a piece of land of
             about 300 donum at a value of SYP 500 million. The building comprises the
             administrative section, the technical section, the storehouses of the raw materials
             and manufactured materials, an auditorium for lectures and conferences plus a
             concrete building for the units of the petrochemical production, in addition to the
             infrastructure of the project such as the sanitary sewage system, the industrial
             sewage system, a lighting and electric network, green open grounds, a building
             comprising the rooms of guards and drivers. The cost of the building and its
             facilities is estimated at SYP 750 billion.

          c. The equipments of the project: (SYP 70 billion (€1.067 of Russian origin)
             These equipments consists of: a flexible steam breaking unit for ethane and
             propane, a unit of extracting biotin which is used in the industry of polyethylene, a
             unit of extracting the mixture of aromacities which are rich in benzene in order to
             be sent to special panels and to be fragmented, a unit of treating solid and liquid
             wastes, equipment of drawing industrial water and the equipments of the laboratory
             for testing the materials and the products. These units will produce 650 thousand
                                                    220
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




               tones of ethylene and 162 thousand tones of propylene which, in turn, will be used
               in manufacturing:
                - Low-dense ethylene with an annual production capacity of 250 thousand tons,
                   high dense ethylene 200 thousand tons, mono-glycol ethylene 350 thousand
                   tons and polypropylene with a production capacity of 200 thousand tons.
                - There are also other supplementary equipments like the ground scale,
                   emergency system, fire-fighting system.

          d.    the ecological effect of the project:
               The project is one of the petrochemical projects which produce chemical
               interactions harmful to the environment and the surrounding area. Therefore, a
               periodical system of maintenance and protection will be put, in addition to an
               emergency system and a system of restoring steam to reduce the emissions of the
               volatile organic compounds.

          e. Means of transportation (SYP 100) million
             Means of transportation consists of trucks for transporting materials and products,
             trucks for transporting the remains, service cars and cars for the managers,
             Pullmans for transporting workers, forklifts and hydraulic lifts.

          f. Furniture and furnishing: (SYP 50 million).
             Office equipments to the administrative offices, tables, chairs, furniture of the
             conferences auditorium, computers, non-cut units, electric appliances, networks…

          g. Expenses of incorporation and licenses (SYP 495 million).
             - Costs of the architectural and civil engineering studies, feasibility study,
                charges, licenses, franchises, patents, wages of the supervisors on the
                construction of the project.
          h. Commodity supplies: (SYP 45 million).
          - Raw materials (ethane, propane and oxygen: SYR 41 billion.
             The project daily needs are 80 million ft3 of ethane, 35 thousand barrels of propane
             (gas & liquid), oxygen and cooling water. The project will be provided by gas from
             the producing countries like Turkey, Egypt, Iran, Libya and Gulf States, in addition
             to the possibility of installing a detachment unit in the refinery of Homs and Banias,
             which help reduce the cost. As for the outgoing refanite, it will be loaded to a
             nearby refinery in order to be treated and get use of it versus getting supplementary
             fuel.
             - Fuel and operating power (industrial electricity, industrial fuel, cooling water):
                  SYP 2.5 billion.
             - Packing and packaging materials: SYP 500 million.
             - Other commodity requirements (supplies) SYP 1 billion.
                                                      221
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          i. Service requirements: (maintenance, mail, telephone, transportation, other
             supplies…)SYP 4.5 billion.

          j. The Administrative structure, wages and salaries:
             - Administrative and legal department: It supervises the registry office, archive,
                guards, drivers, and the administrative works of the legal department which
                organizes contracts and follows up correspondence.
             - Production and purchases department: It is responsible for production in terms
                of purchasing raw materials, testing them and supervising the unit of breaking,
                unit of extracting biotin, unit of extracting the mixture of aromatics.
             - Marketing and purchases department: It is responsible for monitoring and
                studying the motion of the market, preparing the future work plans, the
                required development plans and supervising promotion, sales and distribution.
             - Financial affairs department: It is interested in studying the financial resources
                of the project and employing them in the way that meets the need of the
                establishment.
             - Quality and professional safety department: It is responsible for supervising the
                raw materials and products in terms of conformity with the international
                specifications, in addition to supervising the regulations of professional safety
                and developing them.
             - Human resources department: It supervises the process of attracting and
                employing the required staff and
                developing       their     skills     and
                experiences, in addition to supervising
                the ID’s of the staff.

              The employment needed for the project is
              estimated at 100 workers with two shifts,
              distributed to administrative officials and.
              The total cost of salaries and wages,
              including social insurances, is estimated at SYP 300 million per year.

          Third: Financial Study:
           Investment costs are estimated as follows:
          - Fixed capital: SYP 71895 million
          - Working capital: SYP 12000 million

             Annual operating costs are estimated as follows
          -   Commodity requirements: SYP 45000 million.
          -   Service requirements: SYP 4500 million.

                                                    222
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




          - Wages and employment: SYP 300 million.
          - Depreciations: SYP: 7166.5 million.
          Variable costs are estimated at SYP 48720, and fixed costs are estimated at SYP
          8246.5.
             Economic and financial analysis of the project:
          -   Total investment costs = SYP 83985 million.
          -   Value of annual revenues = (the average lifetime of the project is 20 years) = SYP
              147143.5 million.
          -   Total annual costs (the average lifetime of the project is 20 years) = 88795.5
              million.

              Notice: Revenues are raised 5% and costs are raised 5% during the production
              lifetime of the project.

             Economic parameters of the project:
              a. Annual gross profits                         = SYP 65514.8 million
              b. Net profits                                  = SYP 58348.3 million
              c. Pay-back period                              = 6.1 years (four years of which
                  are for the establishment).
              d. Rate of return of capital (investment)      = 78 %
              e. Net present value at a discount rate of 15% = SYP 130861.2 million
              f. Break-even point                             = 12%
              g. Internal rate of return                      = 34.8%

              If the variable costs increase 10%, the internal rate of return becomes 32%.
              If the revenues decrease 10%, the internal rate of return becomes 29.5%.


             Most important required permits:
          -   Industrial permit and the approval of the Minister of Oil.
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Subscription and allotment.
          -   Building license.
          -   Administrative permit and ecological consent.

              The industrial cities include the service of the one stop shop, which provides all
              these permits.




                                                    223
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Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




                                      A Summary of a Feasibility Study
                                  A Factory of rubber plates (Nucleate, Eva)
                                  Homs Governorate /Hasia Industrial City/

               About the project:
                The project is listed under the chemical industries. It
                aims at manufacturing cellular rubber plates (Eva) and
                non-cellular plates (nucleate) which are used in
                shoemaking (sole or insole).
                It is noticed that there is a large gap in the production
                of rubber soles in the Syrian market as a result of the
                demand of the factories and the workshops of
                shoemaking, in addition to the demand of the external
                factories. The industrial city in Hasia was chosen for
                building this project in order to make use of its
                investment advantages.
                This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
                 Product & quality:
                  The lower side of the shoe must be grinded, and the insole must be able to absorb
                  wetness. It must also be sweat-resistant, adopting the Syrian standard specifications
                  and the world specifications issued by the British association SATRA to enable the
                  project export its products to the foreign markets.

                 Study of demand
                  The demand for the products of the project arises from the demand of the factories
                  of shoes, which is estimated at 51,741,900 shoes:
              -   Men and women shoes: 13,125,000 inhabitants of 15 years and above X 1.5 shoes
                  = 19,687,500.
              -   Boys shoes:7,740,000 inhabitants of under 15 years × 3.66 shoes = 28,328,400.
              -   Sport shoes (trainers): 15.525,000 inhabitants of 10 years and above X 0.24 shoes =
                  3,726,000.
                  Since each rubber piece (product of project) gives 20 shoes, the total demand is
                  2,587,000 pieces, in addition to the special demand of the grounds of cars,
                  bathrooms and belts.

                 Study of supply:
                  Exploratory studies showed that the total local production is nearly 1,000,000
                  pieces (cellular and non-cellular), and the imported soles and insoles are estimated
                  at 1,500,000 pieces. Most of them are imported from China and Egypt in an effort
                  to block the increasing gap on these products.


          
              Survey of family's income 2009-2010.
                                                        224
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




              Gap between demand and supply:
               The data mentioned above indicates that locally-made quantities are too little, and
               they do not cover the need of the local market, and that the gap between the local
               supply and the demand is approximately 1.6 million pieces. So, the project will
               cover a small part of this gap and support the local production with high quality
               rubber pieces enabling the factory to compete with the foreign industry as well.

              Competition & competitors:
               The industry of rubber pieces is mainly centered in
               Aleppo governorate and in little amounts in other
               governorates. The most important competitors according
               to their market share are:
          -    Tarterian
          -    Estanbouli (Hex)
          -    Kheirallah
          -    Addakak
          -    Al-Ahliyah (public sector)
          -    Akadah

              Strategies of sale and distribution:
               Since the products of the project are mediatory, it is preferred to depend on
               wholesalers, in order to be the agents of the project in the Syrian governorates. This
               compresses the costs and realizes a good rate of sales which will be distributed as
               follows:
          -    Local markets: 90% of the product (Aleppo, Hama, Damascus countryside, Homs,
               Deir Ezzor).
          -    Regional markets: 10% of the product (Iraq).

              SWOT:
          a.   Opportunities and points of strength:
          -    The weakness of the internal competition and the limitedness of its production.
          -    The weakness of the imported products from China to compete with the local
               product in terms of quality (except Spain).
          -    Selling the product in the local market makes it easy to avoid the risks of the
               external demand.
          -    The possibility of creating new promising sale channels in the neighboring
               countries.

          b. Threats and points of weakness:
          - The possibility of the fluctuation of raw materials, especially the imported ones
             (The industrial rubber is linked with the oil prices, and the natural rubber is affected
             by the fluctuations of weather.

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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          -   The competition of Chinese and Egyptian goods in terms of prices in spite of their
              low quality.
          -   The need for the existence of large stock of raw materials and the attached risks.
          -   The limitedness of the skillful employment in the project area.

             Revenues of project:
              The capacity of the project is 640 tons per year (90% nucleate, 10% Eva). Since the
              average kg of nucleate is 500, and the average of one kg of Eva is SYP 120, the
              revenues will be SYP 228,800,000.

          Second: Technical Study:
           Technical description of project:
          a. Location: The project is situated in the industrial city in Hasia for many reasons
             such as the road and rail networks for transporting passengers and others for
             forwarding goods and linking the Syrian seaports on the Mediterranean sea and the
             neighboring countries with the industrial city, in addition to the proper climate of
             the investment and the infrastructure.

          b. Land and Building: (SYP 85,000,000)
             The project will be built in the Hasia industrial city on a piece of land of about
             12,000 m2 at a value of SYP 20,000,000. The buildings are valued SYP
             65,000,000. (production halls, laboratories, stores, management offices.

          c. Machinery and equipment: (SYP 100,000,000) European origin.
             The project comprises the following machines:
          - Two production lines for producing cellular pieces. Each line consists of : one
             sponge kneading machine, two cylinders, one slicing machine, one grating
             machine, one electricity, generator, two presses, one calendar, one mill, one closed
             kneading machine, one furnace.
          - An integrated production line for rubber non-cellular plates consisting of: two
             kneading machines, four cylinders, one mill , a line of cooling nucleate, a washing
             line, moulds, one grating machine, one packing and packaging machine.

          d. Means of transportation (SYP 7,000,000): forklifts, various pickups, one private
             car.
          e. Furniture and furnishing: (SYP 500,000).
          f. Expenses of incorporation (SYP7,500,000).
          g. Commodity requirements: (SYP 132,000,000).
          - Raw materials (rubber materials, filler, active materials,…. : 115,000,000.
          - Other commodity requirements (electricity, water, fuel): SYP 17,000,000.
          h. Service requirements: ((maintenance, mail, telephone, advertisement,
             promotion,…: SYP 3,000,000).

                                                   226
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          i. Administrative and organizational structure
             The administrative and organizational structure of the project consists of:
              - Production department: It is responsible for all stages of the production
                  process.
              - Marketing and sales department: It is responsible for purchases and sales,
                  supplying raw materials, supervising marketing policies, following up
                  promotion, distribution and sales locally and externally.
              - Management and finance department: It is responsible for following up the
                  staff affairs, wages, salaries and all financial processes.
             The employment needed for the project is estimated at 80 workers with one shift,
             distributed to 15 administrative officials, 65 experts, technicians, maintenance, and
             guards. The total cost of salaries and wages is estimated at SYP 15,000,000.

          Third: Financial Study:
           Estimation of investment costs:
           - Fixed capital: SYP 200,000,000
           - Working capital: SYP 50,000,000.

              Estimation of annual operating costs:
           -   Commodity requirements (supplies): SYP 132,000,000
           -   Service requirements: SYP 3,000,000.
           -   Wages and employment: SYP 15,000,000
           -   Depreciations: SYP: 16,250,000.
               Variable costs are estimated at SYP 141,000,000, and fixed costs are estimated at
               SYP 25,250,000.

              Economic and financial analysis of project:
          -    Total investment costs = SYP 250,000,000.
          -    Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
               287,782,000
          -    Total annual costs (the average lifetime of the project is 10 years) = SYP
               202,598,000.
               Notice: Revenues and costs are raised 5% during the production lifetime of the
               project.

              Economic parameters of project:
               a. Annual gross profits                         = SYP 101,434,000
               b. Net profits                                  = SYP 85,184,000
               c. Pay-back period                              = 2.5 years
               d. Rate of return of capital (investment)      = 41%
               e. Net present value at a discount rate of 15% = SYP 199,404,400

                                                    227
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                f. Break-even point                               = 23%
                g. Internal rate of return                        = 34.2%
                h. Added value                                    = 96,800,000
          The project is largely sensitive towards the fall of   its revenues 20%, where the internal
          rate of return decreases to 23.3%.

            Most important required permits:
           - Industrial permit / Ministry of Industry.
           - Licensing under law No. /8/ Syrian Investment Agency.
           - Subscription and allotment
           - Building license
           - Administrative permit & Ecological consent
          The industrial cities include the service of the one stop shop, which provides all these
          permits.




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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




                                        A Summary of a Feasibility Study
                                       Producing Phosphatic Fertilizer TSP
                                      Homs Governorate/ Eastern Mines Zone/

               About the project:
                The project is classified under the chemical
                industries. It aims at investing the large reserve of
                raw phosphate in Syria (eastern mines zone) and
                using it in producing solvable phosphatic
                fertilizers, in order to benefit from the added
                value out of manufacturing instead of exporting
                phosphate as a raw material. Added to this is the
                necessity of meeting the local need of these
                products, where phosphor is considered the most
                important chemical element for plants and animals, because it enters all the vital
                functions.

                  This summary includes: marketing study, technical study and financial study.

          First: Marketing Study:
           Product & quality:
              The stone of phosphate is the main raw material for producing phosphatic fertilizers
              (TSP: triple super phosphate), where it is milled and treated with acids (sulfur acid,
              phosphor acid). This kind of fertilizer contains 45% - 50% of phosphor pentoxide.
              The element of phosphor, which is existent in the fertilizer, enters in the structure of
              cereals in the form of complex composites, where it increases the size of the grain
              of wheat and other cereal crops. It also increases the rate of starch in potato, and the
              rate of sugar in beet. And it gives a better immunity to the plants against disease
              and drought.

                 Study of demand:
                  The demand for the phosphatic fertilizers TSP (concentration 46%) in 2010
                  according to the data of the directorate of Botanical Production approximately
                  amounted to 475,000 tons (equal to 220,000 tons of the active material).

                  Study of supply:
                  The local production of TSP during the latest years is estimated at 218,744 tons /
                  year. The rest of the need is covered by these fertilizers at present via importation.

                 Gap between demand and supply:
                  The previous data indicates a clear gap in favor of the demand estimated at
                  256,250 tons. This is the quantity of the Syrian imports of phosphatic fertilizers.
                  Therefore, the project will pump more products of the local production of this


          
              Statistics group 2010
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                strategic material in the local market (250,000 tons) and benefit from this gap in
                realizing new profits.

               Competition & competitors:
                There is only one factory for manufacturing TSP affiliated to the public sector (the
                General Company of Manufacturing Fertilizers). It is characterized for being too
                old, and its production does not meet the local demand.

               Strategies of sale, distribution and securing raw material:
               - Local markets: At a rate of 90% of the production, where the project will cover a
                   large part of the need of farmers and holders of agricultural projects.
               - Regional and international markets: At a rate of 10% of the production.
                   Concentration will be on the countries which need the studied fertilizers like
                   Jordan, Lebanon and Iraq.

               SWOT:
              a. Opportunities and points of strength:
               - The availability a very large reserve of raw
                  phosphate.
               - The need of the internal and external markets to the
                  TSP.
               - The development of the area where the project will be
                  built.
               - Creating new job opportunities and realizing suitable economic proceeds.
               - Providing foreign currency by selling to the external markets.

              b. Threats and points of weakness:
               - The project needs a large amount of water.
               - The remains of phosphor-jebsion and acid water are harmful.

            Revenues of project:
             The annual revenues of the project are estimated at 5,825,000,000
                       Products                  Qty/thousand          Price                               Total
                                                        ton          ton/SYP
           Revenues of TSP                             250            17,800                           4,450,000,000
           Revenues of dicalcium phosphate               20           15,000                            300,000,000
           Sulfur acid                                   34            7,500                            255,000,000
           Phosphor acid                                 20           41,000                            820,000,000
                         Total                                                                         5,825,000,000

                Notice: During the process of manufacturing fertilizer, a group of raw materials
                (dicalcium phosphate, Sulfur acid and Phosphor acid) will manufactured. More
                quantities of these materials can be produced and sold.

                                                     230
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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




          Second: Technical Study:
           Technical description of project:
          a. Location: The project is suggested to be in the eastern area of phosphate mines. It
             is a distant area, 180 km far from Homs. The site is characterized by being near
             from the main raw material (raw phosphate). The distant site reduces the
             ecological effect of the project. In the future the project can make use of the project
             of drawing the water of the Euphrates and the railway to the area of the project,
             which helps in transportation and distribution.

          b. Manufacturing process:
          - Manufacturing sulfur acid: After melting the raw sulfur and burning it to get SO2
             and SO3 where the SO3 interacts with water and produces sulfur acid.
          - Manufacturing phosphor acid: by mixing the wet stones of phosphate with
             phosphor acid in a special reactor, where the formed mixture is moved and filtered
             in order to get phosphor acid.
          - Producing TSP: by inserting the washed stones of wet phosphate after drying them
             and grinding them until 100 micron as maximum (for increasing the surface of
             interaction with the phosphor acid) to the reactor of phosphor acid. After the
             reaction, the product is taken to a fermented, then it is pumped into ejectors. From
             the ejector it moves to the granulator and at last to the dryer. Later, it is taken to the
             sieves. Then it is sorted and packed.

          c. Land and Building: (SYP 1,030,000,000)
             The area which is needed for carrying out this project is estimated at 3 km2. (0.2)
             km2 is allocated for building the factory, and (1.5) km2 as a dump for the
             phosphorjibsom which results from the project. The other area will be allocated for
             internal routes and gardens. The cost of the building is estimated at /1/ billion, and
             the value of the land is estimated at /30/ million Syrian pounds.

          d.   Machinery and equipment: ( SYP 4,945,000,000 of a European origin ):
          -    Section of washing phosphate.
          -    Section of producing sulfur acid.
          -    Section of producing phosphor acid.
          -    Section of producing TSP.
          -    Section of producing dicalcium phosphate.
          -    Section of supplementary utilities.
               Added to these sections are the electric and
               mechanic sets, control sets, measuring and
               laboratory tools and instruments.

          e. Means of transportation (SYP 92,000,000):
          - 3 trucks and dumpers, 3 forklifts, 2 cranes, 2 fire engines, 4 buses for transporting
             workers, 5 small buses, 4 bulldozers, 1 ambulance.
                                                   231
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




          f. Furniture and furnishing: (SYP 33,000,000): Metal and wood furniture, office
             and electronic equipment.
          g. Expenses of incorporation and licenses (SYP 500,000,000), including the
             expenses of engineering studies, feasibility study and expenses of operating tests …
          h. Commodity requirements: (SYP 3,885,000,000).
           - Raw materials: (Raw materials for producing 250,000 tons of raw sulfur, raw
             phosphate, calcium carbonate, packing and packaging materials): SYP
             3,745,000,000.
           - Other commodity requirements (electricity, water, fuel): SYP 140,000,000.
          i. Service requirements: (insurances, tests, mail, telephone, advertisement,
             promotion,…): SYP: 48,000,000.

          j. Administrative structure and organizational:
              The administrative and organizational structure of the project consists of:
             - General Manager's office.
             - Department of labor, administrative and legal affairs.
             - Planning and statistics department.
             - Department of accounts and financial affairs.
             - Marketing and commercial department.
             - Production department.

              The employment needed for the project is estimated at 437 workers with one shift,
              distributed to 36 first class, 117 second class, 202 third class, 82 ordinary workers..
              The block of salaries and wages, indemnities, incentives and in-kind merits is
              estimated at SYP 115,000,000.

          Third: Financial Study:
              Estimation of investment costs:
              - Fixed capital: SYP 6,600,000.
              - Working capital: SYP 500,000,000.

              Estimation of annual operating costs:
              - Commodity requirements (supplies): SYP 3,885,000,000.
              - Service requirements: SYP 48,000,000.
              - Wages and employment: SYP 115,000,000.
              - Depreciations: SYP: 669,500,000.

              Variable costs are estimated at SYP 3,969,400,000 and fixed costs are estimated at
              SYP 748,100,000.

              Economic and financial analysis of project:
              - Total investment costs = SYP 7,100,000,000.
                                                     232
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




              -     Value of annual revenues = (the average lifetime of the project is 10 years 2
                    years for incorporation) = SYP 5,564,758,000.
              -     Total annual costs (the average lifetime of the project is 10 years + 2 years for
                    incorporation) = SYP 4,415,477,000.

                  Notice: Revenues and costs are raised 3% during the production lifetime of the
                  project.

              Economic parameters of project:
              a. Annual gross profits                 = SYP 1,818,781,000
              b. Net profits                         = SYP 1,149,281,000.
              c. Pay-back period                               = 6.9 years, including the years of
                 incorporation.
              d. Rate of return of capital (investment) =31 %
              e. Net present value at a discount rate of 15% = SYP 1,845,752,141.
              f. Break-even point                    = 42% = SYP 2,337,198,360.
              g. Internal rate of return              = 21.2%
              h. Added value                          = SYP 1,940,000,000.

                  The project is largely sensitive towards the fall of its revenues 10%, where the
                  internal rate of return decreases to1.6 %.

              Most important required permits:
              - Licensing under law No. /8/ Syrian Investment Agency.
              - The consent of the General Establishment of Chemical Industries to provide the
                project with raw phosphate.
              - Industrial permit / Ministry of Industry.
              - Agricultural permit/ Ministry of Agriculture.
              - Administrative permit Homs Governorate – Technical Services.
              - Ecological consent / Homs Governorate – Directorate of Environment.




                                                      233
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                              A Feasibility Study Summary of
                     A Factory of Producing Tires for Cars, Means of Public
                                  Transportations and Tractors
                          Homs Governorate / Hasia – Industrial City /

           About the project:
            The project consists of an integral production line for
            making and marketing tires of cars and vehicles of public
            transportation and tractors with different sizes suitable to
            the general demand. 20% of the product will be exported.
            This project is considered necessary because of the
            increase of the number of vehicles and the increase of the
            consumption of tiers in general. The project is suggested
            to be built in the industrial city in Homs.

          First: Marketing Study:
           Product & quality:
              The product will produce high quality tires able to compete with the world brands,
              because of the dependence on excellent kinds of raw and rubbery materials, in
              addition to the modern technology of production. The project will provide the
              following tires:
               - Tires of different sizes for cars.
               - Tires of different sizes for vehicles of public transportation.
               - Tires of different sizes for agricultural tractors.

             Study of the demand
              There are nearly 1.5 million vehicles in Syria.
              Each one needs 4 tires every 3 years on average.
              That is to say, we need 6 million tires every 3
              years, i.e. 2 million tires per year with a value of
              s.p. 6 billion on average.

             Study of supply:
              Every year Syria imports about 1.3 million tires with a value of 3.9 billion Syrian
              pounds. Afamia, which is the only factory in Syria, produces about 20% of the need
              of all vehicles with a value of 1.6 billion Syrian pounds, i.e. about 600 thousand
              wheels, but this quantity is threatened to decrease.

             Gap between the demand and the supply:
              The gap between the annual supplies which amounts to s.p. 5.1 billion, i.e. 1.9
              million tires and the demand which amounts to s.p. 6 billion, i.e. 2 million tires is
              s.p. 0.9 billion, i.e. 100,000 tires per year. However, the imported quantity is
              practically considered a gap because it is not locally produced.


                                                      234
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




              Competition & competitors:
               Afamia Company for Tires in Homs is the only competitor. Although it is the only
               company in the country, and although its share in the local market is approximately
               15% for the large sizes and 50% for the agricultural sizes, and 1% for the trucks,
               the company experiences a miserable situation, because of its need to the raw
               materials and because of its old machines.

              Strategies of sale and distribution:
          -    80% of the product will be locally marketed in the internal markets.
          -    20% of the product will be exported to the regional and international markets to
               realize an income of foreign currency.

              SWOT:
              a. Opportunities and points of strength:
                 - The ability of providing the raw materials and the required technology for this
                   industry.
                 - The increasing demand for the product due to the increase of vehicles and the
                   increase of consumption to the tires with the increase of the inhabitants and
                   the development of their standards of living.
                 - The increasing large gap with the increase of demand.
                 - The weakness of the internal competition represented by the only factory
                   which does not meet the market neither in production nor in quality.
                 - Joining the Free Arab Trade Zone by Syria and the paving of the way to it for
                   joining the International Trade Organization opens new prospects of
                   exportation.

              b. Threats and points of weakness:
                 - Fluctuations of the prices of raw materials.
                 - The strong competition of the high quality of foreign brands.

              Revenues of the project:
              Marketing    Product                 Qty/tire   Price                   Total S.P
              Locally      Cars tiers               48,000     SYP 3,000               SYP 144,000,000
                           Public transportation    24000     SYP 12,000                     SYP 288,000,000
                           Tractors                 12000     SYP 10,000                     SYP 120,000,000
              exported     Cars tiers/wheels        12,000       $70                            SYP 38,640,000
                           Public transportation     6000        $265                           SYP 73,140,000
                           Tractors                  3000        $220                           SYP 30,360,000
              total                                                                       SYP 694,140,000

                                                     235
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          Second: Technical Study:
            Technical description of the project:
           a. Location:
              The project will be built in the middle area because the industry of tires needs, to
              some extent, dry and moderate environment so that the mixture involved in the
              industry becomes cohesive and balanced.

          b. Land & Building : (s.p. 159,080,000)
             The factory will be built on a piece of land of no less than 20,000 m2 fit to the need
             of the project with a value of about s,p. 40,000,000.
             The building will be designed according to an internal chart fit to the requirements
             of the production process and the conditions of controlling quality with regard to
             the process of production and storing with a value of nearly s.p. 119.080,000.

          c. Machines and equipment: (s.p.714,540,000 of west European origin)
             The machines of the project consist of:
             - Cutting, mincing and detaching raw materials lines
             - Melting and masticating lines
             - Putting wires and formation lines.
             - Cooling line
             - Sorting and storing section.

          d. Means of transportation (s.p. 18,100,000)
          e. Furniture: (s,p 2,000,000).
          f. Expenses of incorporation and permits (s.p 8,500,000).
          g. Commodity requirements: (s.p 301,686,000).
              - Raw materials consist of the inputs of the project (rubber, wires, adhesives, and
                  other materials.
              - Other commodity requirements (electricity, water, fuel): s.p 9,378,000.
          h. Service requirements: (maintenance, mail, telephone, advertisement, promotion
             …): 17,653,000
          i. The organizational structure, salaries and wages:
             - Production department: It is responsible for the whole stages of production
                processes in addition to the laboratory and quality.
             - Promotion and sales department: it responsible for putting the advertisement and
                promotion policies, in addition to supervising the process of sales.
             - Human resources and financial department : It is responsible for the finance
                section and the personal affairs section, in addition to the drivers and workers.
             The project needs 80 workers with one shift, distributed to 5 administrative
             officials, 47 experts, technicians and specialized workers, 28 permanent and
             provisional workers.
             The total cost of wages and salaries with the social insurance is estimated at s.p.
             23,340,000
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




          Third: Financial Study:
           Investment costs are estimated as follows:
             - Fixed capital: s.p 902,220,000.
             - Working capital: s.p 106,402,000.
           Annual operating costs are estimated as follows:
             - Commodity requirements: s.p. 301,686,000
             - Service requirements: s.p. 17,653,000
             - Wages and employment: s.p. 23,340,000
             - Depreciations: s.p. 83,128,000
              Variable costs are estimated at s.p. 325,144,400 and fixed costs are estimated at s.p.
              100,662,600

             Economic and financial analysis of the project:
              - Total investment costs = s.p 1,008,000.
              - Value of annual revenues = (the average lifetime of the project is 10 years) =
                  s.p 873,081,832
              - Total annual costs (the average lifetime of the project is 10 years) =
                  s.p 509,625,732
              Notice: Revenues are raised 5% and costs are raised 5% during the production
              lifetime of the project.

             Economic parameters of the project:
                a. Total annual profits                            = s.p 446,584,100
                b. Net profits                                     = s.p 363,456,100
                c. Pay-back period                                 = 2.3 years
                d. Rate of return of capital (investment)         = 44%
                e. Net present value at a discount rate of 15% = s.p 963,144,337
                f. Break-even point                               = 22%
                g. Internal rate of return                        = 37.7%
                h. Project added value                            = s.p 392,454,000
              The project has a large sensitivity towards the reduction of its revenues at a rate of
              10%, and the internal rate of return becomes 29.8%.

              Most important required permits:
              - Industrial permit
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allotment
              - Building license
              - Administrative permit and ecological consent.

              The industrial cities include the service of the one stop shop, which provides all
              these permits.

                                                     237
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Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




                                 A summary of a feasibility study
                          For the production of cancer and tumor drugs
                     Damascus Countryside Governorate / Adra Industrial City /

          About the project:
           The project is listed under projects of pharmaceutical
           industries. It aims at producing medicines of benign
           and malignant tumors. This project is considered as
           one of the strategic projects in Syria and the Middle
           East, due to its urgent need, especially after the
           increasing number of patients with tumors in Syria
           and the Arab world, and the lack of local products.
           It is proposed that the project is established in the
           Industrial City of Rural Damascus to take the advantage of investment provided by
           these cities.

                This summary of Feasibility Study includes: marketing, technical, and financial
                studies.

          First: Marketing Study:
           Product & quality:
            Cancer is the second largest cause of death in the world after heart diseases, which
            results in 23% of total death. It is treated in several ways; the most important are
            (surgical, radiation, chemotherapy, hormonal ...).

           Study of demand:
            According to the first report of cancer in Syria (2002 - 2007) the general annual
            average rate of cancer was 70 cases per 100,000 inhabitants. The disease cases
            estimated at about 118,018 cases during the period 2001-2010, meanwhile they were
            estimated at about 14,606 cases in the year 2010.
            The patient needs 10 to 15 doses a year, so the annual demand by new patients is
            between 146,060 to 219,090 doses.

           Study of supply:
            At present, the Syrian market of cancer medicines and drugs is fully covered through
            imports from foreign countries (governmental institutions, companies and
            establishments of the private sector, and smuggling).


          
              Ministry of Health.
          
              Field survey included hospitals of nuclear medicine is Syria.
                                                                       238
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




           Gap between demand and supply:
            Through the review of previous figures we note that there is an obvious gap in favor
            of the demand. The project shall produce tumor medicines covering part of the local
            market needs, and taking the advantage of this opportunity.

           Competition and competitors:
         1. Offices and companies that are importing drugs for tumors such as the Saidalieh
            Foundation and scientific offices of the foreign companies that drugs are imported
            from, can’t compete on prices.
         2. The expected future competition: the possibility of producing tumor drugs by local
            companies of pharmaceutical industry. The most important pharmaceutical
            companies of Syria are:
            - Unipharma.
            - Aubrey & Associates.
            - Ibn Hayyan.
            - Asia.
            - Alpha.

           Major products of the project:
            - Injections shocked by cooling.
            - Ordinary liquid injections.
            - Capsules.
            - Dry tablets.

           Strategies of sale and distribution:
            The project shall follow the policy of local selling during the early years of work
            then it starts exporting to neighboring markets.
            Local markets: 100% of production capacity.
            The project should build up good relations with hospitals and physicians for selling
            its products and gaining reputation that enables them to compete and export abroad.

           (SWOT):
          a. Opportunities and points of Strengths:
         - Lack of other factories producing tumor drugs in Syria or in the region.
         - The government’s support to national industry, especially regarding the policy of
             replacement of imported medicines by locally made ones.
         - The opportunity to secure the active ingredients from the company that concession
             will be obtained from, and through other sources.
         - Preventing foreign companies from entering Syria for manufacturing.


                                                   239
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




          b. Threats and points of weaknesses:
         - The lack of an agreement to guarantee an effective protection to the patent of the
             pharmaceutical industry in Syria.
         - Entry of Chinese and Indian firms to the Syrian market.
         - The availability of certain drugs that secured through smuggling or treatment abroad.

           Revenues of the project:
            The project sales (injection - tablets - capsules) begin at one million dollars (SYP
            46,000,000) in the first year, reaching 7 million dollars (SYP 322,000,000) in the
            fourth year, and up to 12 million dollars (SYP 552,000,000) in the seventh year,
            which is the maximum capacity of the project.

          Second: Technical study:
            The project which is a pharmaceutical company will
            produce drugs used in chemotherapy of tumors.
           Technical description of the project:
         a. Location: Adra Industrial City in Rural Damascus
            Governorate has been selected as the location for this
            project.

         b. Land and building: SYP(210,000,000)
            The project requires a land area of 50 donums for a value of SYP(15,000,000).The
            construction area is12,000 m2, for a value of SYP 195,000,000 including service
            buildings and warehouses.

         c. Machinery and equipment: (SYP 600,000,000 Western European origin)
            The project requires equipment, including:
            - Dry tablets production line.
            - Capsules production line.
            - Ordinary liquid injections production line.
            - Injections shocked by cooling production line.
            - Laboratory for quality control and ensuring
                conformity with the specifications.

         d. Transportation means, furniture and expenses of incorporation: SYP
            (90,000,000)
         e. Commodity requirements (start with SYP 35,000,000 in the first year and
            increasing with the increase of production to become SYP 259,000,000 in the
            seventh year- the maximum capacity of the project -). They include:
              - Raw materials: (different active ingredients - other ingredients – packing and
                 packaging materials).
              - Other commodity requirements (electricity, water, fuel).

                                                   240
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




         f. Service requirements (maintenance, mail and telephone, research and experiments
            ...): SYP 30,000,000.
         g. Administrative and organizational structure:
             - The production division: It is specialized in managing the production lines and
                  supervision of the production process.
             - Promotion and marketing division: It is responsible for the supply and storage of
                  raw materials required for the production process, selection the best methods of
                  promotion and supervision of sales and agents.
             - Division of human resources and finance: It is the division which is responsible
                  for personnel of workers and staff, control correspondences within and outside
                  the company, continuous training and habilitation and supervision of the supply
                  of qualified cadre and doing the regular accounts of the company.
             - Division of scientific research and laboratory testing: It specialized in checking
                  the liability of active ingredients, quality of drugs, carrying out researches and
                  experiments for the continuous development and control of product quality.
             - Unit of quality assurance: It’s an independent unit - the Director General - to
                  ensure the quality of the production according to the requirements of Good
                  Manufacturing Practices (GMP).
            Requirements of labor estimated at 76 workers (one shift), 20 administrators and 56
            production technicians -The total costs of salaries and wages, including social
            security estimated at SYP 20 million.

        Third: Financial Study:
             Estimation of investment costs:
             - Fixed capital: SYP 900 million.
             - Working capital: SYP 100 million.

             Estimation of annual operating costs:
             - Commodity requirements: Start at SYP 35 million in the first year and increasing
                with the increase of production to become SYP 259 million in the seventh year
                (the maximum capacity of the project).
             - Service requirements: SYP 30 millions.
             - Labor and employment: SYP 20 millions.
             - Depreciations: SYP 87.750 million.

             The fixed costs are estimated at SYP 107,750,000 ,while variable costs increasing
             with the increase in the production capacity where they start at SYP 65 million in the
             first year and increase to become 289 million in the seventh year ...

            Economic and financial analysis of the project:
         -   Total investment costs = SYP 1,000,000,000.
         -   Value of annual revenues (the average lifetime of the project is 20 years) = SYP
             596,122,000.
                                                  241
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




         -   Total annual costs (the average lifetime of the project is 20 years) = SYP
             430,700,000.
             Notice: Revenues and costs are raised 5% beginning from the seventh year of the
             project production lifetime.

            Economic parameters of the project:
             a. Total annual profits = SYP 253,172,000.
             b. Net profits = SYP 165,422,000.
             c. Pay-back period of invested capital = 9.3 years, because the project will not
                reach the total revenues until the seventh year.
             d. Rate of return of capital (investment) = 25%.
             e. Net present value at discount rate of 12% = SYP -144,830,900.
             f. Break-even point of the project = 39% (SYP 8,737,080).
             g. Internal rate of return IRR = 13.3%.

             Most important required permits:
             - Permit of the Ministry of Health / Damascus (application form for licensing
               pharmaceutical product in the Ministry of Health, should also get the concession
               of a global company.
             - Industrial permit / Ministry of Industry/.
             - Licensing under law No./8/-the Syrian investment commission-.
             - Subscription and allotment.
             - Building license.
             - Administrative permit and ecological consent.

             The Industrial Cities contain the service of the stop shop, which provides all these
             permits.




                                                   242
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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                           A Feasibility Study Summary of
                         A Factory of Producing Printing Inks
                Damascus Countryside Governorate / Adra Industrial City /

           About the project:
            The project is listed under the chemical projects whose
            aim is to produce printing inks of alcoholic or aquatic
            origin which are used in printing on containers of
            different forms to those used in food stuff (biscuit
            packages, chips packages) and advertisement materials
            (bags of gifts and packaging paper, in addition to other
            printing materials used on the paper and cardboard of
            packaging.

             The project is specialized in the different kinds of packaging ink because they are
             greatly desirable in the Syrian market, and because they are not greatly produced on
             the local level. The project is suggested to be built in the industrial city in Damascus
             rural area (Adra).
             This summary of the feasibility study includes: marketing study, technical study and
             financial study.

          First: Marketing Study:
           Product & quality:
            Many kinds of printing inks are produced in Syria such as:
          - Lithographic offset ink. It is highly glossy. It is used for complicated printing works,
            and it is applied on a various number of printing papers like glossy paper, normal
            paper, mat paper, streaked paper,…etc.
          - Packaging ink: It is liquid and it meets all the general and special printing
            applications, including all the basic colors and metallic, in addition to the anti-light
            and anti-alkaline ink.
          - Radiation curving ink-UV: It is a technology through which the aforementioned
            kinds are manufactured such as the offset ink, UV, screen ink, UV, flixo ink,UV.
           Screen ink is used for the containers of detergents, containers of food oils and car oils.

           Study of demand:
            The demand of printing ink on nylon arises from the existing printing firms in the
            market and the factories of plastic containers and from every factory manufacturing
            items depending on containers or nylon bags (food industries, chemical industries,
            engineering industries.. etc.). The annual consumed quantities of printing ink in Syria
            are estimated at 9,180 tons at a value of one Syrian billion pounds.

           Study of supply:
            The annual supply of ink is nearly 6,880 tons. Part of it is imported ready, and then it
            is packed and floated in the market as being Syrian. There also many quantities
                                                     243
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                imported from Germany, China, Belgium,… etc. The prices
                of these inks vary according to their quality.

           Gap between the demand and the supply:
            The gap appears from the quantities of inks imported in
            2009, where they nearly reached 260 million Syrian pounds
            for 2,300 tons. This reflects products with variant quality,
            where some of these products are better or similar to what is being produced in the
            Syrian market. And other products are less in quality but they are salable because of
            their little prices.

           Competition & competitors:
            There are 24 permitted companies working in the field of inks,
            dyestuffs and solvents. The strong competition is limited
            among 4 factories in Syria. The most important of which is
            Midad Company for Printing and Solvents, with a production
            capacity of 4,000 tons of different kinds of inks.

           Strategies of sale and distribution:
          - Local markets: At a rate of 50% of production. It is directed to the large printing
            firms and those whose consumption is moderate.
          - Regional markets: (Gulf States, Iraq, Jordan, Turkey) at a rate `of 50% of the
            production. These markets are presently targeted by local producers.

           SWOT:
         a. Opportunities and points of strength:
          - The weakness of competition in the local market.
          - The incremental demand for printing inks as a result of the development of this
            sector in general.
          - The future possibility of extension to many kinds of ink (offset inks, UV inks,…etc.).

          b. Threats and points of weakness:
          - The competition of low-cost Chinese inks.
          - The absence of restraints on the imports of inks in terms of quality and the
             compatibility to the standard specifications.
          - The need for the continuous training to fill the technical gap.

           Revenues of the project:
            The annual revenues of the project for producing 3,000 tons of packaging inks are
            estimated at s.p 577,500,000 distributed as follows:



          
              Statistic group 2010 – Central Bureau of Statistics
                                                                244
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Investment Opportunities Guide
                                                                                                                       Beat Al khebrah
                                                                                                                                     Syria 2011
                                                                                                              Consulting & Studies of Economic
                                                                                        




                Description            Produced qty (ton)         Sale price (s.p/kg)                   Revenues (s.p)
                Colored inks           1,500                      200                                   300,000,000
                One-color ink          1,500                      185                                   277,500,000
                Total                  3,000                                                            577,500,000

          Second: Technical Study:
           The technical description of the project:
           a. Location: Adra industrial city because of the advantages presented to the
              industrialists.
          b. Land: (s.p 20,000,000)
             The factory will be built on an area of no less than 10 donums (a measure of land,
             1000sq. m.) within the industrial city.

          c. Building: (s.p. 50,000,000)
             The building is 2,000 m2 according to an internal chart fit to the requirements of the
             production process and the conditions of quality control related to the process of
             production and storing.

          d. Machines and equipment: (s.p.110,000,000 of western European origin)
             The project consists of a group of machines for the process of production as follows:
             - Primary mixing Machines.
             - Grinding machines
             - Mixing machines with additives.
             - Filtering machines
             - Packing machines (packing and packaging machine with its supplements, labeling
               machine…)
             - Laboratory and quality control unit for the raw materials and the final product.

          e. Means of transportation (s.p. 5,500,000)
          f. Furniture: (s,p 1,500,000).
          g. Expenses of incorporation and permits (s.p 3,000,000).
          h. Commodity requirements: (s.p 440,000,000).
          -  Raw materials (nitro-cellulose, solvents, additives, dyes , packing and packaging):
             s.p 424,500,000.
          - Other commodity requirements (electricity, water, fuel): s.p 15,500,000.
          i. Service requirements: (maintenance, mail, telephone, advertisements, promotion,
             (s.p 4,000,000).

          j. The organizational structure, salaries and wages:
          The organizational and administrative structure consists of the following departments;


          
              Each 1 ton needs $3,000 colorful ink and $2,300 one-color ink.
                                                              245
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




               - Production department: It is responsible for the whole stages of the production
                  process, in addition to the laboratory and the quality section.
               - Promotion and sales department : It is responsible for putting the advertisement
                  and promotional policies, in addition to supervising the process of supplying raw
                  materials regularly and looking for overseas markets.
               - Human resources department: It comprises the financial department, the
                  personal affairs department, drivers and employees.
          The employees needed for the project are estimated at (22 employees) distributed to 8
          administrative employees,14 technical, production, maintenance and guard employees.
          The total cost of salaries and wages, in addition to the social insurance is estimated at
          s.p 8,000,000

          Third: Financial Study:
           Investment costs are estimated as follows:
          - Fixed capital: s.p 190,000,000.
          - Working capital: s.p 150,000,000.

           Annual operating costs are estimated as follows:
          - Commodity requirements: s.p 440,000,000.
          - Service requirement: s.p 4,000,000.
          - Wages and employment: s.p 8,000,000.
          - Depreciations: s.p 15,500,000.
          Variable costs are estimated at s,p 446,400,000. And fixed costs are estimated at s.p
          21,100,000.

           Economic and financial analysis of the project:
          - Total investment costs = s.p 340,000,000.
          - Value of annual revenues = (the average lifetime of the project is 10 years) = s.p
            662,039,000
          - Total annual costs (the average lifetime of the project is 10 years) = SYP
            557,053,000
          Notice: Revenues are raised 3% and costs are raised 4% during the project lifetime.

           Economic parameters of the project:
             a. Total annual profits                         = s.p 120,486,000
             b. Net profits                                  = s.p 104,986,000
             c. Pay-back period                              = 2.8 years
             d. Rate of return of capital (investment)       = 35%
             e. Net present value at a discount rate of 15% = s.p (236,856,721
             f. Break-even point                             = 17% (112,546,630)
             g. Internal rate of return                      = 34.3%
             h. Added value                                 = s.p. 137,500,000

                                                    246
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          The project has a large sensitivity toward the decrease of its revenues at a rate of 20%,
          where the internal rate of return becomes 10.7%.

           Most important required permits:
          - Industrial permit
          - Licensing under law No. /8/ Syrian Investment Agency.
          - Subscription and allotment
          - Building license
          - Administrative permit and ecological consent.
          The industrial cities include the service of the one stop shop which provides all these
            permits.




                                                    247
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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




                               A Summary of a Feasibility Study
                              Producing Medical Gases (Oxygen)
                    Damascus Countryside Governorate / Adra Industrial City /

               About the project:
                The project is categorized under the chemical industries. It aims at producing and
                filling oxygen, in order to meet the increasing need
                of the medical sector of gas, depending on the
                medical bases and the relevant accredited
                international standards.
                There is a large need, especially in Damascus
                governorate and its rural area, for such a project
                because of the spread of the largest number of
                hospitals in these two governorates.(35% of the country's hospitals).

                  This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
                 Product & quality:
                  The project tends to manufacture oxygen and fill it in twenty-liter cylinders with a
                  purity rate of 99.5% to supply it to the hospitals and the rooms of the incentive care
                  (Syrian specifications and standard).

                 Study of demand:
                  Hospitals in Syria in 2009 counted 491. The daily consumption of a hospital is
                  estimated at 125 ampoules. Consequently, the annual total demand for the medical
                  gas in Syria is estimated at 22,095,000 ampoules, in addition to the consumption of
                  other medical centers.

                 Study of supply:
                  The volume of the produced gases (oxygen, nitrogen and ethylene) in Syria in 2010
                  is estimated at 1640 million cubic meters. About 25% of the quantity is oxygen;
                  i.e. 410,000 m3 (20,500,000 ampoules of oxygen).

                 Gap between demand and supply:
                  It turns out that there is an explicit gap between this product and what is being
                  displayed in the local market. The gap is estimated at 1,595,000 ampoules, in
                  addition to the demand for the new hospitals which opens every year (8 hospitals).
                  Their demand is estimated at 360,000 ampoules. Consequently, the project will
                  cover part of this gap and enhance the capability of the local product in the
                  competition externally.


          
              Central Bureau of Statistics
          
              Ministry of Health
                                                        248
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




               Competition & competitors:
                There are many factories for producing oxygen. The most important of which are:
               - The French Company for Producing Oxygen.(Adra Industrial City).
               - Haj Husein Ali Company (Nabek city).
               - The General Company for Metal Constructions (Adra Industrial City).
               - The Syrian Company for Industrial and Medical Gases. LTD.
                There are also many small workshops, but their production forms a small part of the
                local demand for this product.

               Strategies of sale and distribution:
               - Local markets: 100%. Focus will be on Damascus and its countryside, as well as
                   Aleppo and its countryside because of the existence of the largest number of
                   hospitals in these governorates.

           SWOT:
          a. Opportunities and points of strength:
             - Air is the raw material (priceless).
             - The present gap and the necessary need of hospitals for this daily consumptive
               product.

          b. Threats and points of weakness:
             - The trend of some large hospitals to establish a private plant for generating
               oxygen in hospitals.
             - The accuracy and sensitivity of this industry, because it is explodeable and
               inflammable.

              Revenues of project:
               The annual revenues of the project out of selling 103,680
               ampoules of oxygen are estimated at SYP 55,000,000. The
               price of an ampoule of gas is SYP 175.

          Second: Technical Study:
              Technical description of project:
          a.   Location: Damascus Countryside/ Adra Industrial City, in
               order to benefit from the available infrastructure in the
               industrial city, and because of its closeness to the targeted
               markets.

          b. Land and Building: (SYP 16,500,000)
             The project will be built on an area of no less than 2 dunams (2,000 m2) at a value
             of SYP 4 million. As for the building, it will be constructed according to an internal
             chart fit to the relevant requirements and conditions of quality control of producing
             medical oxygen at a value of SYP 12,500,000.
                                                    249
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




          c. Machinery and equipment: ( SYP 50,000,000 of a French origin).
             The project consists of an integrated line as follows:
             - Air compressors (with full air station).
             - A device for generating oxygen.
             - Devices of calibrating oxygen.
             - A station of filling oxygen.
             - Filters.

          d. Tools and instruments: Cylinders for filling gas (changeable) at a value of
             7,000,000.
          e. Means of transportation (SYP 5,000,000)
          f. Furniture and furnishing: (SYP 1,000,000).
          g. Expenses of incorporation and licenses (SYP 2,500,000).
          h. Commodity requirements: (SYP 10,000,000): Electricity, water, spare parts.
          i. Service requirements: (maintenance, mail, telephone, advertisement, promotion,
             insurance…): SYP 4,000,000.

          j. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:
             - Production department: It is responsible for all stages of the production process,
               in addition to the laboratory and laboratory section.
             - Promotion and sales department: It is responsible for advertisement and
               promotion.
             - Human resources and finance department: It comprises the financial directorate,
               the personal issues directorate, drivers and workers.

              The employment needed for the project is estimated at 30 workers with one shift,
              distributed to 9 administrative officials, 18 technicians, production and maintenance
              workers, guards. The total cost of salaries and wages, including social insurances, is
              estimated at SYP 7,000,000.

          Third: Financial Study:
           Estimation of investment costs:
          - Fixed capital: SYP 75,000,000.
          - Working capital: SYP 5,000,000.

             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP 10,000,000.
          -   Service requirements: SYP 4,000,000.
          -   Wages and employment: SYP 7,000,000.
          -   Depreciations: SYP: 7,325,000.
                                                 250
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




              Variable costs are estimated at SYP 16,000,000 and fixed costs are estimated at
              SYP 12,325,000.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 80,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) =
              SYP 63,051,000.
          -   Total annual costs (the average lifetime of the project is 10 years) =
              SYP 31,535,000.

              Notice: Revenues are raised 3% and costs are raised 4% during the production
              lifetime of the project.

             Economic parameters of project:
               a. Annual gross profits                         = SYP 38,841,000.
               b. Net profits                                 = SYP 31,516,000.
               c. Pay-back period                             = 2.2years
               d. Rate of return of capital (investment)      = 49%
               e. Net present value at a discount rate of 15% = SYP 94,564,825
               f. Break-even point                            = 28%
               g. Internal rate of return                     = 44%
               h. Added value                                = SYP 45,000,000.

              The project is largely sensitive towards the rise of its capital 20 %, where the
              internal rate of return decreases to 36.2%. The added value of the project is
              estimated at SYP 45,000,000.

             Most important required permits:
          -   Industrial permit / Ministry of Industry.
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Subscription and allocation.
          -   Building license
          -   Administrative permit and ecological consent

              The industrial cities include the service of the one stop shop, which provides all
              these permits.




                                                   251
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                           A Summary of a Feasibility Study
                       A factory of Recycling Household Wastes
                Damascus Countryside Governorate / Adra Industrial City /

           About the project:
            This project is listed under the eco-friendly
            industrial project. It aims at recycling
            household wastes at a daily rate of 2000 tons
            (the daily moved wastes from Damascus, but
            the real number is more than that). Then, these
            wastes are sorted. Some part is sold and the
            other part is manufactured. In order to be
            legally invested, the investor must make a
            contract with the concerned governmental
            body to allow him collect the wastes and treat
            them, manufacture them and making use of them commercially according to the
            B.O.T system or to any formula, where the government gets 50% of the revenues of
            the project.

              This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
             Product & quality:
              The importance of recycling wastes arises from being a source of pollution, because
              people produce large different amounts of recyclable household wastes, depending
              on the type of life a society lives. These wastes need to be transformed into
              economic products in order to clean the environment as well. In fact, the recycled
              wastes are a national wealth in the very meaning of the word. The most important
              products out of recycling wastes are: organic fertilizers, plastic, metals, paper and
              carton.

             Study of demand:
              The demand for the materials to be produced by the project of recycling the remains
              arises according to their importance. Household wastes consist of 39.40% of
              organic materials which can be transformed into organic fertilizers, and 19.41
              carton which can be recycled, and 2.94% glass which can be re-treated in many
              fields, and 1.74% metals which can re-melted and re-used, and 3.31% aluminum
              which can be re-manufactured, and 11.82% plastic which can be transformed into
              granules and then remanufactured, and 1.61% remanufactured wood, and 3.21% re-
              treatable rubber, and other constituents (16.56%) which can be treated according to
              their type. What proves the current indefinite demand is the presence of many
              people who earn their living from gathering these wastes. Therefore, the project
              should employ these people in the processes of sorting inside the factory.



                                                    252
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




              Study of supply:
               The daily quantities of solid household wastes range from 0.6 – 0.8 kg per capita.
               Accordingly, Damascus governorate and its countryside, whose population in the
               beginning of 2011 was 4,477,000, produce 1,128,000 tons per year (3,133 tons per
               day). 38% is treated in the factory of treating wastes in these two governorates.

              Gap between demand supply:
               Non-exploited amounts of wastes in Damascus and its countryside reach 695,880
               tons per year (1.933 tons per day). This encourages building a factory of recycling
               part of these wastes, which, on the one hand, generates revenues to the investor and
               the government alike, the products of recycling solid wastes witness a large demand
               by the industrial companies (raw materials), and on the other hand it participates in
               getting rid of the wastes without causing damage to the environment.

              Competition & competitors:
               There is only one factory for treating household wastes in Damascus and its
               countryside. About 1200 tons of wastes reach the factory every day, but they cannot
               treat more than a quarter of this quantity. The factory concentrates on producing
               480 tons of organic fertilizer per day.

              Strategies of sale and distribution:
              - Local markets: 100% of the products via selling from the factory, there is no
                  intention now for exporting, because the local market is in need of these
                  products.

              SWOT:
              a. Opportunities and points of strength:
                - The project will participate in covering the need of some recycled materials
                  with standard specifications. It will also preserve the environment and save it
                  from the accumulation of wastes.
                - There is no similar factory in the area. Moreover, the project will employ a
                  large number of workers used to earn their living disorderly with a little return.
                - The use of the organic fertilizers which will be produced by the project.

              b. Threats and points of weakness:
                - The competition of the similar products (recycled products) in the local market.

              Revenues of project:
               The project will operate with a capacity of 2000 tons of wastes. The annual
               revenues are estimated as follows:
               - Organic fertilizers: 792 tons X SYP 2000 X 300 days = SYP 475,200,000.
               - Plastic granules: 260 tons X SYP 20,000 X 300 days = SYP 1,560,000,000.
               - Remains of paper & carton: SYP 1,120,000 at a price of SYP 4,000/ ton.

                                                     253
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




              - Metals: SYP 150,000 at a price of SYP 5000/ton.
              Consequently, the annual total revenues with negligence of the value of other
              materials will be SYP 2,036,470,000.

          Second: Technical Study:
           Technical description of project:
          a. Location: The project will be built in the industrial city of Adra, where the raw
             material is close to the factory, and there are many facilities of investment.

          b. Land and Building: (SYP 170,000,000).
             The factory will be built on a piece of land of no less than 10,000 m2 at a value of
             SYP 20,000,000. The building will be built according to an internal chart fit to the
             requirements of the production process and the conditions of controlling quality at a
             cost of SYP 150,000,000.

          c. Machinery and equipment: (SYP 1, 000,000,000 of a west-European origin). The
             project comprises the following equipments:
             - Sorting halls with the required pallets and mobile conveying belts.
             - A hall of collecting and arranging carton and paper
                with special presses.
             - A hall of arranging metals with special presses.
             - A hall of melting and recycling plastic with the
                required machines.
             - A machine for piercing plastic.
             - A unit of manufacturing organic fertilizer
                (gathering, fermenting, cutting, packaging …).
             - An electricity generator.
          d. Means of transportation (SYP 150,000,000): A fleet of vehicles with deferent
             sizes for collecting different sizes of wastes, buses, trucks and private cars.
          e. Furniture: (SYP 2,000,000).
          f. Expenses of incorporation (SYP 20,000,000).

          g. Commodity requirements: (SYP 275,000,000).
             - Raw materials: (household wastes, plastic granules to be mixed with the
                recycled plastic according to certain rates, packing and packaging materials,
                cleaning materials, soap, condensed liquid ….): SYP 220,000,000.
             - Other commodity requirements (electricity, water, fuel): SYP 55,000,000.
          h. Service requirements: ((maintenance, mail, telephone, advertisement,
             promotion,…:) SYP 20,000,000.
          i. Government's share: 50% = SYP 1,018,235,000.



                                                   254
                                                                                                         
Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          j. Administrative and organizational structure:

               The administrative and organizational structure of the project consists of:
              - Production department: It is responsible for all stages of the production process
                 from collecting wastes, sorting, manufacturing and packaging until preparing
                 them for marketing.
              - Promotion and sales department: It is responsible for drawing up the
                 advertisement and promotional polices as well as supervising the processes of
                 distribution and sales.
              - Human resources and finance department: It comprises the financial directorate
                 (accountant, cashier) personal affairs directorate, drivers and workers, in
                 addition to any relevant transactions.

              The employment needed for the project is estimated at 350 workers with one shift,
              distributed to 35 administrative officials, and the others are technicians,
              maintenance and production workers. The total cost of salaries and wages,
              including social insurances, incentives and bonuses, is estimated at SYP
              100,000,000.

          Third: Financial Study:
             Estimation of investment costs:
          -   Fixed capital: SYP 1,342,000,000.
          -   Working capital: SYP 100,000,000.

             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP 275,000,000.
          -   Service requirements: SYP 20,000,000.
          -   Wages and employment: SYP 100,000,000.
          -   Depreciations: SYP: 141,900,000.

              Variable costs are estimated at SYP 331,000,000 and fixed costs are estimated at
              SYP 205,900,000.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 1,442,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              2,561,450,000.
          -   Total annual costs (the average lifetime of the project is 10 years) =         SYP
              622,228,000

              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project (10 years).


                                                   255
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




             Economic parameters of project: (on the macroeconomic level)
              a. Annual gross profits                        = SYP 2,081,122,000
              b. Net profits                                 = SYP 1,939,222,000
              c. Pay-back period                             = 0.7 years
              d. Rate of return of capital (investment)       = 144%
              e. Net present value at a discount rate of 15% = SYP 7,325,969,368
              f. Break-even point                            =10%
              g. Internal rate of return                      = 118.9%
              h. Added value                                  = SYP 1,761,470,000.

              Since the government's share is 50% of the net profits, i.e. 50% of the revenues, the
              investor's share will be half of the revenues, i.e. SYP 1,018,235,000. Thus:

              The economic parameters (on the individual level of the investor) will be as
              follows:

               a. Annual gross profits                           = SYP 800,397,000
               b. Net profits                                     = SYP 658,497,000
               c. Pay-back period                                 = 1.8 years
               d. Rate of return of capital (investment)         = 56%
               e. Net present value at a discount rate of 15% = SYP 2,036,591,870.
               f. Break-even point                                 =24%
               g. Internal rate of return                          = 47.1%
              The project is more sensitive to the fall of its revenues at a rate of 10% where the
              internal rate of return falls to 31.5%.

             Most important required permits:
              - Industrial permit / Ministry of Industry.
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allocation.
              - Building license.
              - Administrative permit and Ecological consent

              The industrial cities include the service of the one stop shop, which provides all
              these permits.




                                                    256
                                                                                                              
Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




                                      A Summary of a Feasibility Study
              A Factory of Producing Carton and Indurate Paper from Remains of Old Paper
                    Damascus Countryside Governorate / Adra Industrial City /

               About the project:
                This project is listed under the chemical projects. It
                aims at manufacturing the remains of paper
                factories and the paper remains of printing houses.
                The site of the project corresponds with its
                purpose, because Damascus and its countryside are
                the largest governorates to produce paper wastes,
                and they are the most Syrian governorates to
                consume the products of carton, because of they are the greatest number to
                consume carton because of the large number of factories and industrial workshops.
                The project is considered eco-friendly, because it is based on the idea of
                manufacturing paper wastes, and it does not cause any kind of harmful
                contaminants to the environment, whether they are liquid, solid or gaseous.
                This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
                 Product & quality:
                  The product of carton and indurate paper is
                  considered necessary to the industrialists and
                  sellers, especially the factories of medicines and
                  detergents. The quality of these products is linked
                  with the customer's desire.
                  The project will produce a high quality product
                  reaching to 350g/m2.

                 Study of demand:
                  The need of industrialists and craftsmen of indurate paper is estimated at 200,000
                  tons.

                 Study of supply:
                  The local production nearly covers 80% of the need of industrialists and craftsmen.
                  The imports nearly cover 10% (20 thousand tons) of this need.

                 Gap between demand supply:
                  The numbers indicate the existence of a gap in favor of the demand for the studied
                  products estimated at 10%. Added to them is the quantity of imports which count
                  10%; i.e. the entire gap is estimated at 40 thousand tons. Therefore, new factories
                  must entere in order to participate in reducing the imports of carton and indurate
                  paper, realize a surplus of foreign currency, and meet the needs of all the concerned
                  industrialists and craftsmen by the local industry.
          
              Summary of foreign trade 2009
                                                        257
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




              Competition & competitors:
               There are three factories in the Syrian market producing various kinds of paper
               industries: the first one is in Aleppo, the second in Damascus and the third in Deir
               Ezzor, but it is not specialized. There are also small workshops whose products do
               not exceed 140 tons a year (collectively). Here are the main competitors in the
               Syrian market:
          -    The Syrian Arab Company of Manufacturing Carton and its Derivatives.
          -    Techno-Pack Company.
          -    Al-Malek for Packing.

              Strategies of sale and distribution:
          -    Local markets: 80% of the product will be locally marketed.
          -    Regional and international markets: 20% of the product will be exported to the
               regional and international markets.

              SWOT:
          a.   Opportunities and points of strength:
           -   The existence of the current gap, in addition to the increasing demand.
           -   The possibility of exporting to the neighboring countries.

          b. Threats and points of weakness – suggested solutions:
          - The competition of the high quality foreign products.

               Revenues of project:
                Marketing        Product         Qty/ton        Price                      Total/syp
               Locally            carton          1,200       SYP 30,000                 SYP 36,000,000
                              Indurate paper      1,200       SYP 40,000                 SYP 48,000,000
               exportation        carton           300          $700                     SYP 9,660,000
                              Indurate paper       300          $920                     SYP 12,696,000
                   Total                                                                SYP 106,356,000

          Second: Technical Study:
           Technical description of project:
          a. Location: Damascus rural area / Adra, where the industrial
             plants which need the products of the project as materials for
             packing and packaging spread there..

          b. Land and Building: (SYP 24,000,000).
             The project will be built on a piece of land of no less than 5,000 m2, fit to the need
             of the project at a value of SYP 10,000,000.
             The building will be designed according to an internal chart fit to the requirements
             of the production process (factory, administrative office, storehouses) at a value of
             SYP 14,000,000.
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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




          c. Machinery and equipment: (SYP 57,000,000 of a European origin).
             The project consists of three mainlines:
          - Line of kneading: It receives the wastes of paper
             from many sources. Then it sorts them, refines
             them, sieves them, soothes them and preliminarily
             kneads them.
          - Section of drawing: Raw material is received from
             the section of kneading, and many supplementary
             materials are added. Then they are drawn and moved in order to be squeezed, dried,
             polished and dried once again to get out in the form of paper plates. Later,
             dimensions and rates of smoothness are identified as needed.
          - Section of releasing and cutting: Plates of carton are cut according to the requested
             forms.

          d. Means of transportation (SYP 7,300,000).
          e. Furniture and furnishing: (SYP 1,000,000).
          f. Expenses of incorporation and licenses (SYP 8,000,000).
          g. Commodity requirements: (SYP 26,066,000).
          -  Raw materials: They are the inputs of the industry. They consist of the wastes of
             paper and whitening and polishing materials at a value of SYP 18,572,000.
          - Other commodity requirements (electricity, water, fuel): SYP 7,494,000.
          h. Service requirements: (maintenance, mail, telephone, advertisement,
             promotion,…): SYP 5,784,000.

          i. Administrative structure - salaries and wages:
               - Production department: It is responsible for all stages of the production
                    process, in addition to the maintenance.
               - Promotion and sales department: It is responsible for drawing up the
                    advertisement and promotional polices as well as supervising the processes of
                    distribution and sales.
               - Human resources and finance department: It comprises the financial
                    department. Personal affairs, drivers and workers.
             The employment needed for the project is estimated at 46 workers with one shift,
             distributed to 4 administrative officials, 27 experts, technicians, specialized
             workers; 15 ordinary and provisional workers.. The total cost of salaries and
             wages, including social insurances, is estimated at SYP 14,760,000.


          Third: Financial Study:
              Estimation of investment costs:
          -    Fixed capital: SYP 97,300,000.
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




          -   Working capital: SYP 13,700,000.

             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP 26,066,000.
          -   Service requirements: SYP 5,784,000
          -   Wages and employment: SYP 14,760,000.
          -   Depreciations: SYP: 9,660,000.
              Variable costs are estimated at be SYP 36,597,200 and fixed costs are estimated at
              be SYP 19,672,800.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 111,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              121,925,000.
          -   Total annual costs (the average lifetime of the project is 10 years) = 63,612,000.
              Notice: Revenues are raised 3% and variable costs are raised 4% during the
              lifetime of the project.

             Economic parameters of project:
                a. Annual gross profits                          = SYP 67,973,000
                b. Net profits                                   = SYP 58,313,000
                c. Pay-back period                                = 1.6 years
                d. Rate of return of capital (investment)         =61%
                e. Net present value at a discount rate of 15% = SYP 191,004,202
                f. Break-even point                              = 25% = SYP 30,481,250
                g. Internal rate of return                            =55.8 %
                h. Added value                                       = SYP 80,290,000
              The project is largely sensitive towards the fall of its revenues. The internal rate of
              return decreases to 35.2% if the revenues decrease 20%.

             Most important required permits:
          -   Industrial permit / Ministry of Industry.
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Subscription and allocation.
          -   A building license.
          -   Administrative permit and an Ecological consent
              The industrial cities include the service of the one stop shop, which provides all
              these permits.




                                                     260
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                              A Feasibility Study Summary of
                     A Factory of Manufacturing Black Portland Cement
                        Damascus Rural Area/Al-Sees Mountain Area

           About the project:
            The project is listed under the chemical
            industry which has a special importance
            in all countries, especially those that have
            raw materials. Cement is considered one
            of the basic products needed for carrying
            out industrial and service projects. It is
            mainly linked with the sector of building
            and construction. It is interlaced with the
            other sectors (industry, agriculture,
            infrastructure,       public        utilities,
            services,…), because cement is the link which gives concrete the required form and
            power for the different constructions. The project is suggested to be built in Al-Sees
            mountain area in Damascus countryside for being one of the suitable locations for
            setting up such projects.
            This summary of the feasibility study includes: marketing study, technical study
            and financial study

          First: Marketing Study:
             Product & quality:
              The portland cement is a grey-color powder which can be taken after producing
              clinker from the limestone, mud, ferrite and bauxite. Then, gypsum is added and
              ground in order to get cement. Syria began producing Portland cement in 1933 in
              Dummar factory in Damascus. The annual local production capacity of Portland
              cement is 5.5 million tons from 10 state factories.

             Study of the demand
              The factors that affect the demand for cement is the number of building licenses
              and the state housing plan, in addition to the projects of dams, irrigation,
              infrastructure and industrial projects.
              The following table shows the Syrian imports of cement in 2009:
                     Description                      Qty/ton Value/(thousand S.P)
                     Portland cement                  2481715 8663206
                     Non-ground cement (clicker) 255504        657621
                     Total                            2737219 9320827

              The population of Syria is estimated at 20,866,000 inhabitants in 2011. And the
              volume of the local production is 5.2 million tons. On the other hand, Syria imports
              about 2.7 million tons per year, i.e. the annual volume of the present demand is 7.9
              million tons.
              The annual growth rate of the demand for cement is nearly 3.8%.

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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




             Study of supply:
              The following table shows the sequence of the volume of the local production of
              cement according to the data of the Central Bureau of Statistics:
                 Year                        2005      2006    2007      2008   2009
                 Production/ million tons 5.218 4.965 5.150 5.646 5.176

               The production of the first private factory began in Al-
              Reqqah governorate by grinding clinker only with an
              annual production capacity of a half million tons. In 2012
              two factories are expected to launch in Damascus
              countryside and Aleppo with an annual production
              capacity of one million tons for both factories.
              Consequently, the estimated annual local production in
              2012 will nearly be 6.7 million tons.

             Gap between the demand and the supply:
              The variance between the demand and the annual local production is clear, where
              approximately 2.7 million tons are imported per year. With the launch of new
              projects, in addition to taking into consideration the increase of production in the
              factories of the public sector, there remains a yearly gap of no less than 1.5 millions
              tons. We confirm here that there will be an increase in the local demand of nearly
              3.8% per year. Therefore, the project will cover the existing shortage and the
              expected increase of the future shortage as expected from the eleventh-five year
              plan which funded investments of about s.p. 350 million for the construction sector.
              Moreover, there will be a possibility for exporting to the nearby countries,
              especially Iraq. This will generate new profits.

             Competition & competitors:
              the Syrian public sector has 10 factories, but all of
              them are characterized by their old machines and
              the old technology of production which are not
              able to be rehabilitated or developed. As for the
              private sector witch will enter the market in future,
              they are as follows:
          -   Turkish Gorish Company (in Al-Reqqah): It grinds
              clinker which is imported from Turkey. Its
              production capacity is 0.5 million tons a year.
          -   German Asik Company (Aleppo): Its future production capacity is estimated at a
              half million tons a year.
          -   Al-Badiyah Cement Company (Damascus Rural Area): Its future production
              capacity is estimated at a half million tons a year.
              On the whole, the local production by the end of 2012 is expected to be 6.7 million
              tons.



                                                     262
                                                                                                          
Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




             Strategies of sale and distribution:
          -   Local markets: (Damascus Rural Area, Aleppo, Hama, Dara, Lattakia, Tartous), in
              addition to other Syrian governorates at a rate of 71% of the production. Damascus
              Rural Area, alone, consumes 23% of the annual consumption of Syria.
          -   Regional markets: (29%) of the product can be exported to the neighboring
              countries like Lebanon and Iraq. There has also been a large demand by Iraq at
              present and in the future.
          -   International markets: There will be no exportation at present.

           SWOT:
          a. Opportunities and points of strength:
          - The availability of raw materials (limestone, basalt, clay, gypsum) with cheap
             prices.
             The growing demand for the product for being important and indispensible.
          - Building the factory in a site where raw materials , means of transportation,
             infrastructure and employment are available.
          - Joining the Free Arab Trade Zone by Syria is an opportunity for competitive
             exportation.

          b. Threats and points of weakness:
          - The short period of the produced material (3 months),
             which affects the possibility of storing for a longer
             period.
          - The insufficiency of the present electric power.

             Revenues of the project:
              The annual revenues of the project for producing one million tons from the
              unpacked and packed cement are s.p. 3,000,000,000
              The price of one ton on average is (s.p. 3000)

          Second: Technical Study:
           Technical description of the project:
          a. Location: The project is located in Al-Seen mountain area in Damascus
             countryside governorate, where the General Establishment of Geology has six
             studied sites identified and prepared for investment (Al-Sees, Al-Juweif, Abu Al-
             Shamat). The project is 85 km far from Damascus city. The site of the project is
             linked with the availability of raw materials. However, these sites are floated by the
             General Establishment of Geology after a geological study and identifying their
             stock. The area needed for the project is /1000/ donum. The investor gets the land
             with an encouraging rent of /s.p. 1000/ for each donum per year.



                                                    263
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          b. Land: The factory will be built on an area of no less than /1000/ donums, leased
             from the General Establishment of Geology against /s.p. 1000/ per donum. This
             will be treated in the service costs.

          c. Building: (s.p. 194,000,000)
             The factory is built according to an internal chart fit to the requirements of the
             production process and the ecological conditions, in addition to the quality control
             which are related to the process of grinding clinker, evaporation, re-heating,
             calcification and cooling.

          d. Machines and equipment: (s.p.3,580,000 of Chinese origin)
             The project consists of the following production lines:
          - The line of the breaker and the process of grinding.
          - The machines of identifying the rates of mixing and their silos
          - The machines of grinding raw materials and their conveying belts and the furnace
             of clinker.
          - The machines of evaporating, heating and cooling.
          - The machines of moving and packaging the packed and non-packed cement to the
             silos.
          - The supporting and controlling group and the group of laboratory.
          e. Means of transportation (s.p. 36,000,000)
          f. Furniture: (s,p 6,000,000).
          g. Expenses of incorporation and permits (s.p 24,000,000).

          h.   Commodity requirements: (s.p 1,830,000,000).
          -    Raw materials (clinker, lime, crude iron, packing bags): s.p. 970,000,000
          -    Other commodity requirements (electricity, water, fuel): s.p 860,000,000.
          i.   Service requirements: (leasing the land, maintenance, advertisement and
               promotion…): s.p. 77,000,000

          j. Administrative and organizational structure:
             - Production department: It is interested in the whole processes of production.
               Attached to it are the laboratory and measuring of quality.
             - Promotion and sales department: It is interested in the process of distribution,
               sales, storing, marketing, in addition to putting the advertisement and
               promotional policies and searching for the clients and customers.
             - Technical department: It is interested in processes of construction, maintenance,
               electrical technical supervision and monitoring the performance of the
               production lines.
             - Administrative and financial department: It is interested in the staff and financial
               affairs in addition to the accounting and services body (drivers, guards, service
               men, workers…).
                                                    264
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




              The employment needed for the project is (350 workers with one shift) distributed
              to 15 administrative staff, 45 advisory engineers, 210 technicians and specialists of
              production and maintenance, and finally 80 unspecialized workers and drivers and
              guards. The total cost of wages and salaries, including the social insurance is /s.p.
              65,000,000/.

          Third: Financial Study:
             Investment costs are estimated as follows:
          -   Fixed capital: s.p 3,840,000,000.
          -   Working capital: s.p 860,000,000.

             Annual operating costs are estimated as follows:
          -   Commodity requirements: s.p. 1,830,000,000
          -   Service requirements: s.p. 77,000,000
          -   Wages and employment: s.p. 65,000,000
          -   Depreciations: s.p. 380,900,000
              Variable costs are estimated at s.p. 1,933,000,000 and fixed costs are estimated at
              s.p. 419,900,000

             Economic and financial analysis of the project:
          -   Total investment costs = s.p 4,700,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 15 years) = s.p
              3,926,030,000
          -   Total annual costs (the average lifetime of the project is 15 years) = 2,949,572,000
              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project.

             Economic parameters of the project:
               a. Total annual profits                          = s.p 1,357,358,000
               b. Net profits                                   = s.p 976,458,000
               c. Pay-back period                               = 3.5 years
               d. Rate of return of capital (investment)       = 29%
               e. Net present value at a discount rate of 15% = s.p (2,326,961,486)
               f. Break-even point                                 = 30% (s.p. 1,177,809,000)
               g. Internal rate of return                        = 24.9%
               h. Added value                                   = s.p. 1,170,000,000
              In case the investment costs increase at a rate of 20%, the internal rate of return
              decreases to 20.5%.

             Most important required permits:
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -    A contract with the General Establishment of Geology for renting the land and
              investing the quarries.
                                                    265
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Investment Opportunities Guide
                                                                                                Beat Al khebrah
                                                                                                              Syria 2011
                                                                                       Consulting & Studies of Economic
                                                                 




          -   The industrial resolution / Ministry of Industry
          -   Administrative permit (Damascus Rural Area governorate – Directorate of
              Technical Services.
          -   The ecological approval (Damascus Rural Area governorate – Directorate of
              Environment)




                                              266
                                                                                                            
Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                                 A Summary of a Feasibility Study
                                  Producing Agricultural Sulfur
                                       Dara Governorate

           About the project:
            This project is categorized under the chemical
            industries. It aims at producing agricultural sulfur to
            meet the growing demand of this material which is
            used for treating most fungal plant diseases
            (pathogens) which attack some crops of vegetables
            and fruitful trees and for treating the fungal of
            agricultural soils. There is a dire need for building
            this project in Dara which is famous for planting
            vegetables and fruitful trees on wide areas, especially tomato and grapes which
            need sulfur for keeping them safe.

              The summary of this study includes: marketing study, technical study and financial
              study.

          First: Marketing study:
             Product & quality:
              The project will produce agricultural sulfur, and then sulfur flower which is mainly
              used as a strong fungicide for controlling the diseases which hit some crops of
              vegetables and fruitful trees (diseases of mealy whiteness,.) or as a protective
              germicide from the aforementioned diseases, in addition to the protection from the
              microvillar whiteness. Sulfur is considered an active element for killing the fungi
              of soil (fuzarium, firtsalium ….). It reduces the rate of the alkalinity of soil. It has
              no effect on the health of man.

             Study of demand:
              The demand for agricultural sulfur is estimated at 34,333 tons on the light of the
              areas which are planted with grape vine (55,868 hectares) and the areas which are
              annually planted with tomato (13,919 hectares), eggplant (7,352 hectares) and
              melon (34,477 hectares), where sulfur is used to treat and protect plants from the al
              diseases. The need of the southern zone (Dara, Suwaida'a and Qunaiterah) of sulfur
              is estimated at 6,763 tons.

             Study of supply:
              The displayed quantities of agricultural sulfur are estimated at 23,000 tons on the
              light of the production of the main existing factories, whose production capacity for

                                                     267
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




              any of them does not exceed 10 tons per day at the best conditions, and some of
              them operate with a production capacity less than 4 tons per day.

             Gap between demand supply:
              The relevant data of the above mentioned supply and demand indicates an annual
              gap estimated at 11,333 tons. Part of this gap is covered by importation.

             Competition & competitors:
              Most agricultural sulfur factories spread in the northern and middle zone. The most
              important factories which have a good market share are: Qablawi and al-Hosan in
              Aleppo, Malokian in Homs and Kojan in Hama.

           SWOT:
          a. Opportunities and points of strength:
          - The large demand for the agricultural sulfur in the southern zone (project area),
             because of the existence of large areas planted with tomato and grapes which use
             sulfur at high rates.
          - The inexistence of any factory for producing agricultural sulfur in the project area.
          - The project adoption of modern safe technologies for producing sulfur.

          b. Threats and points of weakness:
          - The unrest and the fluctuation of the prices of the raw material from one year to
             another.
          - The price competition of some bad qualities which are displayed in the market.
          - The link of the demand with the agricultural seasons and the condition of the
             agricultural crops.

             Revenues of project:
              The annual revenues of the project are estimated at SYP 94,380,000 as a result of
              selling 4290 tons of agricultural sulfur, considering the price of one ton to be SYP
              22,000.

          Second: Technical Study:
           Technical description of project:
          a. Location: Tafas city in Dara governorate, where it is situated the middle of the
             main areas which produce vegetables and grapes.

          b. Land and Building: (SYP 36,000,000)
             The project will be built on a piece of land of about 6000 m2, at a value of SYP
             12,000,000. The building will be built on an area of 1500 m2 according to a chart fit


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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




              to production process and the conditions of industrial security and the production
              quality control. The value of the building is estimated at SYP 24,000,000.

          c. Machinery and equipment: (SYP 32,000,000 of a European origin).
             Production lines consist of: breaker, grinder,
             residues filtering machines, cyclones, packing
             machines and their complementary tools, in
             addition to electricity gen erators, gantry cranes
             …
          d. Means of transportation (SYP 8,800,000):
             bulldozer, handling, two trucks loading 50
             tons, two pickups.
          e. Furniture and furnishing: (SYP 1,000,000).
          f. Expenses of incorporation (SYP 2,200,000).
          g. Commodity requirements: (SYP 56,000,000).
          - Raw materials: raw materials containing high rates of sulfur, packing and
             packaging materials, supplementary materials …) at a value of SYP 42,000,000.
          - Other commodity requirements: (electricity, water, fuel): SYP 14,000,000.
          h. Service requirements: (maintenance, mail, telephone, advertisement,
             promotion,…): SYP 4,200,000.

          i. Administrative and organizational structure:
             The administrative and organizational structure of the project consists of:
             - Human resources and finance department: It is responsible for the financial
                 affairs of the project and securing liquidity, supervising sales and purchases.
             - Technical department: It is interested in the production process and the relevant
                 issues of the production quality and quantity and the state of the production
                 lines.
              The employment needed for the project is estimated at 20 workers with one shift,
              distributed to 5 administrative officials, 15 technicians, production and services
              workers. The total cost of salaries and wages, including social insurances, is
              estimated at SYP 6,000,000.

          Third: Financial Study:
             Estimation of investment costs:
          -   Fixed capital: SYP 80,000,000.
          -   Working capital: SYP 15,000,000.

             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP 56,000,000.
          -   Service requirements: SYP 4,200,000.
                                                 269
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          -   Wages and employment: SYP 6,000,000.
          -   Depreciations: SYP: 6,800,000.
              Variable costs are estimated at SYP 61,760,000 and fixed costs are estimated at
              SYP 11,240,000.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 95,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              118,710,000
          -   Total annual costs (the average lifetime of the project is 10 years) = SYP
              88,921,000.
              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project.

             Economic parameters of project:
              a. Annual gross profits                          = SYP 36,589,000
              b. Net profits                                  = SYP 29,789,000
              c. Pay-back period                              = 2.6 years
              d. Rate of return of capital (investment)        = 39%
              e. Net present value at a discount rate of 15% = SYP 67,457,569
              f. Break-even point                              =27 % = SYP 32,051,700
              g. Internal rate of return                       = 32.2%
              h. Added value                                   = SYP 38,380,000.
              The project is largely sensitive towards the fall of its revenues at a rate of 10 %,
              where the internal rate of return decreases to 20.1%.

             Most important required permits:
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Industrial permit / Ministry of Industry.
          -   Approving the engineering charts from the Association of Engineers.
          -   Administrative permit / Dara Governorate – Technical Services.
          -   Ecological consent / Dara Governorate – Directorate of Environment.




                                                   270
                                                                                                                 
Investment Opportunities Guide
                                                                                                                Beat Al khebrah
                                                                                                                              Syria 2011
                                                                                                       Consulting & Studies of Economic
                                                                                 




                                         A Summary of a Feasibility Study
                           Extracting Byrene from Rremains of Oil Squeezing
                                          Dara Governorate
          About the project:
           The project is listed under the agricultural
           industries. It aims at extracting byrene and
           some other products from the dregs of the
           olive which comes out of the squeezing
           process. It composes 40 - 45 % of the
           quantity of the squeezed olive. Byrene oil is
           used in many industries (soap, creams, hair
           oil, … ). The project will be built in Dara
           which is famous for planting olive, in addition to the spread of 45 olive mills.
           This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
               Study of demand:
                The demand for the studied products arises from the factories of unrefined virgin
                olive oil (the oil of the second squeezing eatable oil) factories of laurel soup,
                factories of cream, shampoo, hair oil and other cosmetic industries.

               Study of supply:
                The supplied quantities of olive dreg in Syria range from 200 - 400 thousand tons,
                depending on the quantities of squeezed olive (a year of a full yield and a year of
                little yield). Quantities of olive dregs in the mills of the southern zone (Dara,
                Suwaida'a, Qunaiterah) are estimated at 28,168 tons. Most of this quantity is
                marketed to the factories of byrene in Aleppo because of the lack of any byrene
                factory in the southern zone.

               Gap between demand supply:
                The market accommodates any additional quantities of
                byrene oil resulting from any additional quantities of olive
                dreg, no matter how much it is, because of the large need of
                olive oil and because of the large diversity in the industries
                which byrene is part of its composites.

               Competition & competitors:
                There are 34 factories of byrene in Syria: 19 in Aleppo, 7 in Edlib, 5 in Lattakia and
                3 in Tartous, i.e. there is no factory in the southern area in spite of the spread of olive
                trees which count 8.6 million olive trees.

          
              Statistics of Ministry of Agriculture
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Investment Opportunities Guide
                                                                                                               Beat Al khebrah
                                                                                                                             Syria 2011
                                                                                                      Consulting & Studies of Economic
                                                                                




              SWOT:
             a. Opportunities and points of strength:
             - The large quantities of olive dregs coming out of the modern oil mills in the
                southern area.
             - The inexistence of any factory for extracting byrene from the dreg of oil in the
                southern area.
             - The large expenses of transporting olive dreg to Aleppo.

         b. Threats and points of weakness :
          - The fluctuation of the quantities of olive dreg between a year and another because
             of the little high production in a year and low production in another.

             Revenues of project:
              The revenues of the project are estimated at SYP 112,578,000.
             - Byrene oil: 1408 tons X SYP 60,000 = SYP 48,480,000.
             - Solid remains: 18732 tons X SYP 1,500 = 28,098,000.

          Second: Technical Study:
             Technical description of project:
             a. Location: Nawa city is the suggested location for the
                project due to being in the middle of the areas which
                produce olive, and because most olive mills are near to
                it. In addition, electricity and water are available, and the
                network which links it with other areas is also available.

             b. Land and Building: (SYP 18,000,000)
                The project will be built on an area of about 10,000 m2 at a value of SYP 3,000,000.
                The building consists of one block, in addition to metal hangars with an area of
                4,000 m2 at a value of SYP 15,000,000.

         c. Machinery and equipment: (SYP 30,000, 000 of a west-European origin)
            The project consists of: seiving machines, rotating
            dryers, a machine for grinding hard remains, mixers,
            storhouses, destillation devices, sorters for detaching
            oil, refining devices, filtering devices, hydrogenation
            and others.

         d. Means of transportation (SYP 5,000,000 ).
            The project needs two trucks loading 5 tons and 3
            pickups.
         e. Furniture and furnishing: (SYP 500,000).

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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




         f. Expenses of incorporation (SYP 2,500,000).
         g. Commodity requirements: (SYP 80,590,000).
            - Raw materials: value of transporting olive dreg and organic solvents: 72,420,000.
            - Other commodity requirements (electricity, water, fuel): SYP 8,170,000.
         h. Service requirements: SYP 3,300,000.

         i. Administrative structure:
            The administrative and organizational structure of the project consists of:
           - Production department: It is responsible for production and maintenance.
           - Administrative and financial department: It is interested in securing cash liquidity,
              project accounts and its financial status, in addition to the organizational affairs
              and the staff affairs.
           - Marketing and sales department: It is interested in purchasing, distributing the
              final product, supervising the process of advertising and promoting.
            The employment needed for the project is estimated at 24 workers with one shift.
            Their block of salaries is estimated at SYP 6,900,000.

          Third: Financial Study:
             Estimation of investment costs:
             - Fixed capital: SYP 56,000,000.
             - Working capital: SYP 24,000,000.

             Estimation of annual operating costs:
             - Commodity requirements (supplies): SYP 80,590,000
             - Service requirements: SYP 3,300,000
             - Wages and employment: SYP 6,900,000
             - Depreciations: SYP 5,350,000
              Variable costs are estimated at SYP 85,990,000, and fixed costs are estimated at SYP
              10,150,000.

             Economic and financial analysis of project:
             - Total investment costs = SYP 80,000,000.
             - Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
                141,599,000.
             - Total annual costs (the average lifetime of the project is 10 years) = SYP
                118,307,000
              Notice: Revenues and costs are raised 5% during the lifetime of the project.

            Economic parameters of project:
              a. Annual gross profits                        = SYP 28,642,000
              b. Net profits                                 = SYP 23,292,000
                                                    273
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Investment Opportunities Guide
                                                                                                      Beat Al khebrah
                                                                                                                    Syria 2011
                                                                                             Consulting & Studies of Economic
                                                                       




               c. Pay-back period                             = 2.8 years
               d. Rate of return of capital (investment)       = 36%
               e. Net present value at a discount rate of 15% = SYP 47,597,010
               f. Break-even point                            =30 % = SYP 42,479,700
               g. Internal rate of return                     = 29.6%
               h. Added value                                = SYP 31,988,000

             The project is largely sensitive towards the fall of its revenues 10%, where the
             internal rate of return decreases to 11.2% .

             Most important required permits:
             - Licensing under law No. /8/ Syrian Investment Agency.
             - Industrial decision/ Ministry of Industry.
             - Approving the engineering charts from the syndicate of Engineers.
             - Administrative permit / Dara governorate – Technical Services.
             - Ecological consent / Dara governorate – Directorate of Environment.




                                                  274
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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




                                A Summary of a Feasibility Study For
                             A Factory of Producing Milk and Babies’ Food
                                          In the Eastern Area

               About the project:
                This project is listed under the projects of
                food industries. It aims at producing milk and
                babies’ food which Syria imports at high
                rates. The eastern area has been chosen as a
                site to the project for being close to the raw
                materials and for being a wide market for
                selling the products.

                  This summary of the feasibility study includes: marketing study, technical study
                  and financial study

          First: Marketing Study:
                 Product & quality:
                  The project will produce powdered milk and foods
                  manufactured from wheat and rice with different
                  flavors, observing the best special conditions and
                  international specifications of babies’ food. The
                  project will depend on the locally produced raw
                  materials, in addition to producing other none
                  available     materials    according   to   certain
                  specifications.

                 Study of the demand:
                  The demand for the products of the project arises from the families which have
                  children, especially infants. The monthly expenditure of a family is estimated at s.p.
                  1,200 (1000 for milk and 200 for babies’ food). Syrian children under 4 years old at
                  the end of 2010 are estimated at 521,650. Since 40% of them take these foods, the
                  demand for children’s food is s.p. 2,995,200,000 per year (521,650 children X 40%
                  X s.p.1, 200 X 12 months).

                 Study of supply:
                  Many brands of children’s food are available in pharmacies. They are usually
                  imported by the state. There are also different kinds of soya milk and medical milk
                  supported by iron and calcium. Children’s food is usually made from rice and
                  wheat, and most of these foods are imported (Nistleh milk powder made in Syria by
                  Nistlah Company but it is only for children of one year old or more. There is also a
                  kind of flavored rice which is locally made). Statistics indicate that Syria imports
                  5,219 tons of children’s food per year at a value of s.p. 2,230 billion.

          
              Summary of foreign trade 2009
                                                        275
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




              Gap between the demand and the supply:
               Based on the above mentioned data, we notice that the gap is estimated at s.p.
               765,200,000 (s.p. 2,995,200,000 – s.p. 2,230,000,000). It confirms the necessity of
               building a factory for producing this vital commodity which is very important to the
               growth of children in order to compensate for the alternative foods which mothers
               use at present.

              Competition & competitors:
               Imported types, which people became accustomed to, are considered a first class
               competitor to the products of the project. Of the most important types we mention
               Nan (1-2-3…) and Fiscose which are given to infants from the time of birth till they
               become one year old. There are also other types of babies’ food like Cerelac and
               Bebelac which are made of wheat, and Gerber which is made of a mixture of fruit,
               vegetables and milk powder such as Klim.
               Local products are linked with Nestleh, the manufacturer of Nido which is not
               specialized for infants, in addition to Sami brand which is made of flavored rice and
               manufactured in little quantities in comparison with the demand.

              Strategies of sale and distribution:
          -    Local markets: 100% of the production capacity is sold via distributing products
               to the pharmacies and the private and public drugstores.
          -    Regional and international markets in a later stage.

              SWOT:
          a.   Opportunities and points of strength:
          -    The demand is featured by continuance, because of the high fertility rate in Syria.
          -    The possibility of exporting to the neighboring countries.

          b.   Threats and points of weakness:
          -    The influence of the world and seasonal fluctuations on the prices of raw materials.
          -    The competition of the existing brands in the local market.
          -    Imitating brands with less quality products.

              Revenues of the project:
               The annual revenues of the project from selling 3,000,000 packets of milk are
               1,000,000 packets of children food with s.p. 700,000,000 a year. The average price
               of one packet to the producers is s.p 175.

          Second: Technical Study:
           Technical description of the project:
          a. Location: The project will be built in the eastern area because it is near from where
             raw materials are (wheat, milk….) and because it is a first grade market for selling
             its product.

                                                     276
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




          b. Land & Building: (s.p.150,000,000):
             The project will be built on a piece of land of no less than 5000 m2 at a value of
             approximately s.p. 3,000,000. The factory will be designed on an area of no less
             than 3500m2 according to an internal chart fit to the requirements of the production
             process and the conditions of quality control at an estimated value of s.p.
             147,000,000.

          c. Machinery and equipment: (s.p. 850,000,000 of west- European origin).
             The project needs the following machines:
              - A line of producing dried milk.
              - A line of producing supported dried milk.
              - A line of producing wheat powder.
              - A line of producing flavored wheat.
              - Laboratory        equipments     for     testing
                  specifications.
              - A line of producing tin cans.
              - Printing line.
              - Packaging line.
              - A line for a machine for printing the mark and expiry date
             Each line is accompanied by a sterilization line for sterilizing the product according
             to the best specifications.

          d. Means of transportation (s.p. 10,000,000).
          e. Furniture: (s,p 3,000,000).
          f. Expenses of incorporation (s.p 57,000,000).
          g. Commodity requirements : (s.p 350,000,000).
              - Raw materials (galvanized iron sheets, refills, milk. wheat, flavors, packing
                 and packaging materials) = s.p. 300,000,000.
              - Other commodity requirements (electricity, water, fuel): s.p 50,000,000.
          h. Service requirements: (maintenance, mail, telephone, advertisement and
             promotion. = s.p. 25,000,000.

          i. The organizational and administrative structure
             The organizational and administrative structure of the project consists of:
             - Marketing and sales department: It is responsible for drawing up the
                 advertisement and promotional polices as well as supervising the processes of
                 distribution and selling within the different halls.
             - Production department: It is responsible for all stages of the production
                 process.
             - Human resources and finance department: It comprises the financial directorate
                 (accountant, cashier), and the directorate of the main registry office – ID),
                 drivers and employees and any other process related to the office.

                                                    277
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




              -    Laboratory: It is an independent unit following the general manager. It is
                   responsible for making sure of the good quality and the standard specifications
                   of the products before they are marketed.
              The employment needed for the project is estimated at 90 workers with one shift,
              distributed to 14 administrative officials, and the others are technicians,
              maintenance and production. The total cost of salaries is estimated at s.p.
              25,000,000.

          Third: Financial Study:
             Investment costs are estimated as follows:
          -   Fixed capital: s.p 1,070,000,000.
          -   Working capital: s.p 150,000,000.

             Annual operating costs are estimated as follows:
          -   Commodity requirements: s.p. 350,000,000.
          -   Service requirements: s.p. 50,000,000.
          -   Wages and employment: s.p. 25,000,000.
          -   Depreciations: s.p: 106,350,000.
              Variable costs are estimated at s.p. 400,000,000, and fixed costs are estimated at
              s.p. 131,350,000.

             Economic and financial analysis of the project:
          -   Total investment costs = s.p 1,220,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = s.p
              880,425,000.
          -   Total annual costs (the average lifetime of the project is 10 years)         = s.p
              634,566,000.
              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project (10 years).

             Economic parameters of the project:
              a. Annual gross profits                          = s.p 352,337,000
              b. Net profits                                   = s.p 245,987,000
              c. Pay-back period                               = 3.5 years
              d. Rate of return of capital (investment)         = 29%
              e. Net present value at a discount rate of 15% = s.p388,362,840
              f. Break-even point                                   = 35% (s.p. 308,158,200)
              g. Internal rate of return                        = 23.2%
              h. Added value                                    =s.p. 350,000,000
              The project is largely sensitive towards the fall of its revenues at a rate of 10%,
              where the rate of return falls to 15.6%.


                                                   278
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




             Most important required permits:
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Permit of Ministry of Health.
          -   Industrial permit / Ministry of Industry.
          -   Building license.
          -   Administrative permit.
          -   Ecological consent. / Governorate – directorate of environment.




                                                   279
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Investment Opportunities Guide
                                                                                                                    Beat Al khebrah
                                                                                                                                  Syria 2011
                                                                                                           Consulting & Studies of Economic
                                                                                     




                                   A Summary of a Feasibility Study of
                          A Factory of Birds Fodder, Poultry Slaughter, Storing &
                                              Refrigerating
                                         Al-Hasakah Governorate

               About the project:
                The project is listed under the projects of the food industries
                whose aim is to produce poultry fodder, slaughter birds and
                store their meat.
                The project will be built in Al-Hasakah governorate which
                suffers from a severe shortage in producing fodder materials.
                On the contrary, there is a remarkable increase in the demand
                for the residents of the governorate on these materials because
                they depend on breeding animals in securing their
                livelihood.
                The project is featured by the integration of its services. It
                offers a tempting service to the breeders of poultry in
                return for part of their production (birds). This will make
                the project gain additional profits resulting from
                slaughtering birds and storing their meat till prices rise.
                This summary includes marketing study, technical study,
                financial study.

          First: Marketing Study:
           Product & quality:
              Birds’ fodder: The project will produce poultry fodder for the whole age stages
              according to the Syrian specifications. The most important of which is to be empty
              of soil and hormones.
              Slaughterhouse: It is an establishment accredited by the concerned bodies. It is used
              for slaughtering, inspecting and preparing poultry to the human consumption.

                 Study of demand
                  Birds’ fodder: The need of poultry farms and villagers in Al-Hasakah is estimated
                  at 37,300 tons .
                  Chicken meat: The annual consumption of the family in Al-Hasakah is 72 chickens
                  (the highest consumption in Syria). There are 211,000 families in Al-Hasakah in
                  2010. Consequently, the total consumption of poultry meat in the governorate is
                  15,825,000 chickens.

                 Study of supply:
                  Birds’ fodder: The annual local supply of fodder in Al-Reqqah is 18,000 tons.
                  Chicken meat: There are nearly 393 chicken farms in Al-Hasakah, producing
                  8,600,000 chickens per year.

          
              As stated by the department of animal production in Al-Hasakah.000000000tfr
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




             gap between the demand and the supply:
              Birds’ fodder: The gap is estimated at 19,300 tons per
              year, covered by drawing the surplus of the nearby areas
              of birds’ fodder.
              Chicken meat: The gap is estimated at 7,225,000
              chickens covered by the surplus of the nearby areas.

              Therefore, the studied project will cover part of the need of the governorate (fodder
              and chicken meat).

             Competition & competitors:
              Factories of fodder: There are four factories of fodder in Al-Hasakah (animals,
              poultry and fish). Only two of them are working. Most of the need of fodder in the
              governorate is provided by the merchants of fodder who bring fodder from
              Damascus rural area, Aleppo and Homs. Those merchants control the prices, where
              one kilogram of poultry fodder is sold with SYP 25, while it is sold in Damascus
              and Aleppo with SYP 20.

              Chickens slaughterhouses: Al-Hasakah suffers from the lack of technical
              slaughterhouses with a suitable production capacity and compatibility with the
              governing health specifications and standards with the exception of one
              slaughterhouse attached to the establishment of poultry. However, this
              slaughterhouse is featured for its slow production capacity which hardly suffices
              the need of the establishment which is attached with contracts to provide the
              departments of the Ministry of Oil in Deir Ezzor with chicken meat.

             Strategies of sale and distribution:
          -   Local markets: Al-Hasakah at a rate of 90% of the production capacity (fodder
              and meat).
          -   Regional markets: To Iraq at a rate of 10% of its production.

           SWOT:
          a. Opportunities and points of strength:
          - The large need for fodder in Al-Hasakah due to the littleness of factories, in
             addition to the control of merchants with prices.
          - The large need to the meat of chicken as a result of the dependence of the residents
             of that area on chicken meat as a substitute of mutton and beef for being cheaper.
          - The existence of an unproductive consumptive market for a period of no less than
             10 years; that is the Iraqi market.

          b. Threats and points of weakness:
          - The restraints imposed on importing corn and barley, which results in the rise of the
             cost of manufacturing fodder.

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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




          -        The risks which are related to the stock of raw materials.
          -        The possibility of building similar projects to that of the studied one or increasing
                   the production capacity of the present projects.

                  The revenues of the project:
                   The revenues of the project are estimated at SYP 770,000,000 with a daily
                   production capacity of 100 tons to the factory of fodder and 10 tons to the
                   slaughterhouse of chicken.
                                 Activity                             Annual revenue
                                 Fodder                                 375,000,000
                                 Chicken meat                           375,000,000
                                 Liver,Gizzards,hearts ( guts)           20,000,000
                                 Sum total                            SYP 770,000,000
                   Notice: There will be no problem for the factory of fodder in collecting its debts
                   because it will draw living chicken from its clients (chicken farms owners) with the
                   value of the fodder.

          Second: Technical Study:
              a.    Location: Hasakah governorate is considered the
                    suitable location for this project due to its dire
                    need to fodder and chicken meat, in addition to its
                    location next to the Iraqi border, which makes it
                    easy to export.

          b. Land &Building: (SYP 155,000,000)
             The slaughterhouse of poultry needs an area of 25 donum, while the factory of
             fodder needs an area of 10 donums. Consequently, the total value of the project is
             SYP 40,000,000.
             The slaughterhouse is estimated at 1,000 m2, and the factory is estimated at 2,500
             m2. The total value is estimated at SYP 115,000,000.
             Notice: The slaughterhouse must be 2 km far from the residential complexes in
             order to be granted the license because of its remains of water, feather and the
             remains of birds.

          c. Machinery and equipment: (SYP of 200,000,000 of Turkish origin).
             Slaughterhouse of Poultry: The daily production capacity of the slaughterhouse is
             10 tons. It consists of a running line with hangers and danglers, a tub for soaking
             the feather, a machine for depluming feather, a machine for cutting legs, a room for
             stunning and four freezing rooms.
                   Factory of fodder: The daily production capacity is 100 tons. Its most important
                   constituents are: a bucket lift, grinder, conveyer, external tanks (silos with a
                   capacity of 100 tons).


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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




          d. Means of transportation: (SYP 35,000,000): a traction engine, refrigerator, truck
              loading 27 tons, truck loading 3 tons.
          e. Furniture and furnishings: (SYP 2,000,000).
          f. Expenses of incorporation: (SYP 8,000,000).
          g. Commodity requirements: (SYP585, 000,000).
             - Raw materials: (SYP 530,000,00): living chicken, Indian corn, soya bean.
             - Other commodity requirements (electricity, water, fuel, packing and packaging
                 materials): SYP 55,000,000.
          h. Service requirements: (SYP 10,000,000): maintenance, mail, telephone,
              advertisement, promotion,…)

          i. The organizational structure, salaries and wages:
             - Financial and administrative department: It is responsible for organizing
                administrative and financial affairs, in addition to the salaries, wages and
                accounting.
             - Marketing and sales department: It is responsible for organizing sales,
                supplying raw materials and final stock, in addition to supervising local and
                external distribution and sales.
             - Production department: It is responsible for supervising workers in order to run
                the aforementioned stages, including packing and packaging, selecting quality
                and following up the periodical maintenance of the machines.

               The employment needed for the project is estimated at 62 workers with one shift,
               distributed to 7administrative officials, 55 production workers, technicians. The
               total cost of salaries and wages is estimated at SYP 15,000,000.

          Third: Financial Study:
           Investment costs are estimated as follows:
           - Fixed capital: SYP 400,000,000.
           - Working capital: SYP 100,000,000.

              Annual operating costs are estimated as follows:
           -   Commodity requirements: SYP 585,000,000.
           -   Service requirements: SYP 10,000,000.
           -   Wages and employment: SYP 15,000,000.
           -   Depreciations: SYP: 34,750,000.

           Variable costs are estimated at SYP 601,000,000, and fixed costs are estimated at SYP
           43,750,000.

              Economic and financial analysis of the project:
          -    Total investment costs = SYP 500,000,000.

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Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




          -      Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
                 968,498,000.
          -      Total annual costs (the average lifetime of the project is 10 years) = 799,681,000.

          Notice: Revenues and costs are raised 5% during the production lifetime of the project.

                Economic parameters of the project:
                a. Annual gross profits                            = SYP 203,566,000
                b. Net profits                                     = SYP 168,816,000
                c. Pay-back period                                 = 2.5 years
                d. Rate of return of capital (investment)           =41 %
                e. Net present value at a discount rate of 15%     = SYP 403,802,725
                f. Break-even point                                   = 21% (SYP 203,384,000)
                g. Internal rate of return                         = 34.5%
                h. Added value                                     = SYP 185,000,000.

              The project is largely sensitive towards the fall of its revenues, while the internal rate
              of return decreases to 15.2%.

                Most important required permits:
                 - Licensing under law No. /8/ Syrian Investment Agency.
                 - The approval of the Directorate of Health.
                 - Industrial permit from the Ministry of Industry.
                 - Administrative permit from the governorate
                 - Ecological consent from the government – Directorate of Environment.




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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                                   A Summary of a Feasibility Study
                               Wheat Mill, Making Macaroni and Vermicelli
                                       Al-Hasakah Governorate

               About the project:
                The project is listed under the food industries. It
                aims at producing wheat flour which is a result of
                grinding the grains of wheat, and producing
                macaroni and vermicelli in Al-Hasakah
                governorate owing to the availability of the raw
                material. (hard wheat) which is the best on the
                level of Syria.
                This summary includes: marketing study, technical study and financial study.

          First: Marketing Study:
                 Product & quality:
                  The project produces macaroni and vermicelli after grinding hard wheat. The
                  common forms of uncooked macaroni and vermicelli and their specifications and
                  general conditions are identified in the Syrian standard specification No. /315/.

                 Study of demand:
                  The demand for macaroni and vermicelli arises from the Syrian families,
                  restaurants (the largest group), where the annual consumption of the Syrian family
                  is estimated at 11.4 kg of macaroni and 23.4 kg of vermicelli. The number of Syrian
                  families at the beginning of 2011 is estimate at 3,900,000 families . Thus, the
                  demand for the families is nearly 44,640 tons of macaroni and 91,260 tons of
                  vermicelli, in addition to the demand for restaurant for being extremely desired
                  food for the Syrian society. The demand for restaurant for the different forms of
                  macaroni is relatively larger than the demand for vermicelli. The demand for
                  restaurants for macaroni is three times than the demand for families, i.e. around
                  133,920 tons a year. And the demand for vermicelli is double the demand for
                  families, i.e. 182,520 tons.

                 Study of supply:
                  Macaroni and vermicelli are produced by a group of private companies with an
                  annual production capacity of around 98,860 tons, in addition to Al-Yarmouk
                  Company whose production was 1,800 tons a year, but it is now closed.


          
              General Agency of Syrian Standard Specification
          
              Statistics group 2010 – Central Bureau of Statistics.
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Investment Opportunities Guide
                                                                                                              Beat Al khebrah
                                                                                                                            Syria 2011
                                                                                                     Consulting & Studies of Economic
                                                                               




                 Gap between demand supply:
                  There is a gap between the supply and demand for the local level in the governorate
                  and on the level of the country as a whole. This gap is currently covered by
                  importation. The largest opportunity is in approaching to the foreign market as a
                  result to the distinguished feature of the Syrian wheat and its good quality,
                  especially its hardness.

                 Competition & competitors:
                  There are 62 authorized companies of macaroni and vermicelli at a production
                  capacity of 98,860 tons per year. The most important companies are:
              -   Furella, Dana and Al-Wadi Al-Akhdhar.
                  Most companies are situated in Damascus and its countryside, with different
                  production capacity.

                 Strategies of sale and distribution:
              -   Local markets: The product will be distributed at a rate of 70% of the production.
                  Focus will be the governorates whose families show high rates of consumption (Al-
                  Hasakah, Deir Ezzor, Damascus, Damascus countryside, Aleppo).
              -   Regional markets :( Gulf States, Iraq, Turkey) at a rate of 10% of the production,
                  due to the reduction of wheat planting in these countries.
              -   International markets: At a rate of 20%, especially Italy.

                 SWOT:
          a.      Opportunities and points of strength:
           -      The good quality of the Syrian wheat.
           -      The non-need to a high level of technology.
           -      The possibility of meeting the requirements of the market.

              b. Threats and points of weakness:
              - The fluctuation of the weather and the rates of rains, which in turn, affects the crops
                 of wheat.
              - The diseases that may hit the crops.
              - The loyalty of some consumers for some brands, which requires a large marketing
                 campaigns.

                 Revenues of project:
                  The annual production capacity of the project is estimated at 8,000 tons in 300
                  work days. Revenues are estimated at SYP 274,000,000, where 75% of the
                  production is packed in sacks of ( 1 kg ), which is the most selling in the Syrian

          
              Statistics of Ministry of Industry
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




               society. The wholesale price is SYP 35. The other quantity is packed in sacks of 5
               kg, sold at a price of SYP 160 for each.

          Second: Technical Study:
           Technical description of project:
          a. Location: Al-Hasakah governorate is an important habitat
             for the Syrian wheat. It has been long known for its good
             quality and of being distinguished.

          b. Land and Building: (SYP 23,000,000).
             The project will be built on an area of 2 dunams (2000 m2)
             at a price of SYP 500,000 for each dunam. The floor area of
             the building is 1,100 m2 at a cost of 22 million.

          c. Machinery and equipment: (SYP 67,500,000 of a European origin).
              The project consists of two production lines. The first one is for wheat and the
              second one for producing macaroni and vermicelli. They contain the following
              parts:
             - A silo for storing flour at a suitable capacity + a water tank at a capacity of
                 25m3.
             - A unit of mixing, compressing and forming, provided with a discharge unit and a
                 cutting unit.
             - A unit of initial drying running by vibration.
             - A unit of initial running on belts.
             - A unit of Continuous drying tunnel on belts.
             - A unit of reducing the temperature of the product after drying.
             - Conveying belts.
             - Operating control panel
             - Packing and packaging machines (1 – 10) kg.
             - Ground scale, forklift, hand trolleys loading 1 ton.
             - Machines and laboratory equipment.

          d.   Means of transportation (SYP 5,500,000)
          e.   Furniture and furnishing: (SYP 1,000,000).
          f.   Expenses of incorporation and licenses (SYP3,000,000).
          g.   Commodity requirements: (SYP 207,000,000).
          -    Raw materials: (hard wheat at a price of SYP 21.5/kg, and soft wheat at a price of
               SYP 20.5/kg. The average is SYP 21 X 8,200,000 (including waste) = 172,000,000
               + complementary materials + packing and packaging materials at a value of SYP
               17,800,000.
          -    Other commodity requirements (electricity, water, fuel): SYP 17,000,000.
                                                    287
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




          h. Service requirements: (maintenance,             mail,   telephone,                      advertisement,
             promotion,…): SYP 8,500,000.

          i. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:
          - Production department: It is responsible for all stages of the production process.
          - Purchases and sales department: It is responsible for drawing wheat from the
             farmers, storing it and following the process of selling the final products
          - Human resources and finance department: It is responsible for accounting and
             following up the financial and human resources affairs and how to make them
             available.
            The employment needed for the project is estimated at 35 workers with one shift,
            distributed to 8 administrative officials, 27 technicians, production, workers, guards
            and dustmen. The block of salaries and wages, including social insurances, is
            estimated at SYP 10,000,000.

          Third: Financial Study:
             Estimation of investment costs:
          -   Fixed capital: SYP 100,000,000.
          -   Working capital: SYP 60,000,000.

             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP 207,000,000.
          -   Service requirements: SYP 8,500,000.
          -   Wages and employment: SYP 10,000,000.
          -   Depreciations: SYP: 9,750,000.
              Variable costs are estimated at SYP 217,800,000, and fixed costs are estimated at
              SYP 17,450,000.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 160,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              314,110,000.
          -   Total annual costs (the average lifetime of the project is 10 years) =SYR
              267,133,000.
              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project (10 years).

             Economic parameters of project:
               a. Annual gross profits                         = SYP 56,727,000
               b. Net profits                                  = SYP 46,977,000
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




                 c. Pay-back period                              = 2.8 years
                 d. Rate of return of capital (investment)        =35 %
                 e. Net present value at a discount rate of 15% = SYP 99,226,569
                 f. Break-even point                              = 27% = SYP 84,809,000
                 g. Internal rate of return                      = 30.9%
                 h. Added value                                  = SYP 67,000,000
              It is to be noted that the project comprises two integrated industries, which makes
              its profits multiple.
              The project is largely sensitive towards the fall of its revenues at a rate of 10%,
              where the internal rate of return decreases to 8.7 % .

             Most important required permits:
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Industrial permit / Ministry of Industry.
          -   Approving the engineering charts from the Engineers Association.
          -   Administrative permit / Al-Hasakah Governorate – Technical Services.
          -   Ecological consent / Al-Hasakah Governorate – Directorate of Environment.




                                                   289
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                                A Summary of a Feasibility Study
                 A Factory of Producing Grit and Roasted green wheat (Freekah)
                                     Al-rekah governorate

           About the project:
            The project is classified under the food
            industries. It aims at producing grit and roasted
            green wheat (locally called ( freekah) from the
            hard good wheat. The need for this project arises
            in Al-Rekah governorate as a result of the
            availability of the raw material of wheat
            abundantly, and as the rise of the demand for grit
            and ( freekah ) (consumptive habits in the area),
            in addition to the littleness of the these products
            (one factory and some mills with a low production capacity)
            The project will depend on the local, Arab and foreign markets for distributing its
            products after they are prepared and packed according to the Syrian standard
            specifications.

          First: Marketing Study:
           Product & quality:
            Field studies showed that the important factor of attraction which drive the customer
            to buy a certain kind of grit or ( freekah ) is the cleanliness of the product from the
            impurities such as straw, soil, free of illnesses, the way of packing and packaging.

           Study of demand:
            The products of the project (grit, freekah) are commonly used in the Syrian and Arab
            food. The demand for the product arises from the families, restaurants and
            confectionaries.
            The consumption of a family of these products is estimated at 100 kg a year.
            Consequently, the demand of the families of Al-Rekkah governorate is estimated at
            13,157 tons (921,000 inhabitants in 2010 ÷ 7 the average number of a family in Al-
            Rekkah X 100 kg the annual consumption of the studied products). Added to the
            local demand is the external demand from Iraq which is close to the area of the
            project. It will form a main selling market for most Syrian products in a few years.

           Study of supply:
            The product of Syria of hard wheat in 2009 nearly amounted to 1,581,834 tons. The
            product of Al-Rekkah is 150,685 tons. It is noticed that 45% of Al-Rekkah
            inhabitants depend on keeping part of their product after grinding and sorting it.
            They purchase their needs of grit and ( freekah ) from the stores which draw their
            products from the factories.


          
              Field study to the market of grit and freekah
          
              Statistics group 2010
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




           Gap between demand supply:
            The present gap is estimated at 7,000 tons of the production of the neighboring
            factories of Al-Rekkah governorate. Added to this gap are 336 tons per year as a
            result of the demographical increase in Al-Rekkah governorate (3,368 families).

           Competition & competitors:
            The most important factories which the residents depend on in securing their daily
            needs of grit and ( freekah ) are: Al-Jazeerah factory and Al-Rafedain in Al-
            Hasakah, Al-Shamal in Aleppo and Al-Rafekah in Al-Rekkah. The daily production
            capacity of these products collectively is approximately 100 tons. The competition is
            centered on the factors of price and quality. Therefore, the project will use the latest
            technologies and the trained employment to realize the savings that enable it to sell
            in competitive prices.

           Strategies of sale and distribution:
          - Local markets: 70% of the project especially in Al-Rekkah governorate and the
            nearby governorate in the eastern and southern area.
          - Regional markets: 30% of the production. Focus will be on Iraq for selling these
            products.

           SWOT:
         a. Opportunities and points of strength:
          - The availability of the raw material (wheat) with a high rate in Al-Rekkah
            governorate.
          - The increasing demand for the products of the project because the residents of the
            eastern inhabitants depend on grit and freehkah as two main constituents in their
            daily food.

          b. Threats and points of weakness:
          - The competition of the other factories to the products of the project during the first
             stage.
          - Storing large quantities of wheat and the possibility of the exposure to wetness,
             insects or disease.
          - The prohibition of exporting wheat and its derivatives in certain periods.

           Revenues of project:
          The annual revenues of the project are estimated at SYP 350,000,000.
                        Product               Qty/ton Price ton/SYP               Total
            Grit (harsh, smooth, semolina       4,500          44,000          198,000,000
            Freekah                             1,500         100,000          150,000,000
            Remains of sieving                                                  2,000,000
                          Total                                                350,000,000


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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




          Second: Technical Study:
           Technical description of project:
           a. Location: The project will be built in Al-Rekkah governorate which is featured by
              the high productivity of hard wheat, in addition to the availability of employment
              with low prices.

          b. Land and Building: (SYP 36,000,000).
             The project will be built on a piece of land of nearly 3 dunams (3000 m2) at an
             estimated value of 600,000. The building will comprise the management, the
             production system that contains the production line of grit and freekah, in addition to
             the silos of storing wheat, storehouse for storing the final product, the center of
             testing quality, in addition to the public utilities at a value of SYP 35,400,000.

          c. Machinery and equipment: (SYP 50,000,000/ € 714,285 of a west European
             origin).
             The factory will buy wheat and store it in silos (100 – 300 tons). The production
             process starts through an integrated production line by sieving and sorting impurities.
             Then wheat is boiled, dried, sieved, washed, crushed, peeled, dried, sorted and at last
             packed and packaged. There will be other equipments like the ground scale,
             electricity generator and electricity convertor.

          - Ecological effect of project
            The project does not leave any remains harmful to the environment. And the water of
            boiling and washing can be used for irrigating plants.

          d. Means of transportation (SYP 7,000,000):
             Two trucks for transporting materials, one service car, one
             forklift.
          e. Furniture and furnishing: (SYP 500,000).
          f. Expenses of incorporation and licenses (SYP 5,500,000).
          g. Commodity requirements: (SYP 280,000,000).
          - Raw materials: 230,000,000
             5000 tons hard wheat X SYP 22,000 = 110,000,000.
             2,000 tons freekah (burnt Italian seed) X SYP 60,000 = 120,000,000.
             Materials include a rate of waste and discharge
          - Fuel and operation utilities (industrial electricity, industrial fuel) : SYP 30,000,000.
          - Requirements of packing and packaging: SYP 15,000,000.
          - Other commodity requirements: SYP 5,000,000.
          h. Service commodity: SYP 5,000,000

          i. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:



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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




            - Production and purchases department: It is responsible for all stages of the
               production process, in terms of studying and buying raw materials, in addition to
               supervising the production process and testing the final product.
            - Administrative and financial department: It is responsible for running
               administrative issues like correspondence, archiving, organizing contracts,
               auditing and analyzing accounts.
            - Marketing and sales department: It is responsible for observing and studying the
               motion of the market, preparing future work plans, development plans, and
               supervising promotion, sales and distribution.
            The employment needed for the project is estimated at 40 workers with one shift,
            distributed to 25 technicians and 15 administrative officials.. The total cost of
            salaries and wages, including social insurances, is estimated at SYP 10,000,000.

          Third: Financial Study:
           Estimation of investment costs:
          - Fixed capital: SYP 99,000,000.
          - Working capital: SYP 84,000,000.

           Estimation of annual operating costs:
          - Commodity requirements (supplies): SYP 280,000,000.
          - Service requirements: SYP 5,000,000.
          - Wages and employment: SYP 10,000,000.
          - Depreciations: SYP: 9,370,000.
          Variable costs are estimated at SYP 288,000,000 and fixed costs are estimated at SYP
            16,370,000.

           Economic and financial analysis of project:
          - Total investment costs = SYP 183,000,000.
          - Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
            440,226,000
          - Total annual costs (the average lifetime of the project is 10 years) = SYP
            378,613,000
          Notice: Revenues and costs are raised 5% during the production lifetime of the project.

           Economic parameters of project:
             a. Annual gross profits                          = SYP 70,983,000
             b. Net profits                                   = SYP 61,613,000
             c. Pay-back period                               = 2.6 years
             d. Rate of return of capital (investment)         =39 %
             e. Net present value at a discount rate of 15%   = SYP 132,376,660
             f. Break-even point                              =21 % = SYP 92,447,460
             g. Internal rate of return                       = 32.5%
                                                    293
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




                h. Added value                               = SYP 70,000,000

          The project is largely sensitive towards the fall of its revenues 10%, where the internal
          rate of return decreases to 7 %.

             Most important required permits:
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Industrial decision / Ministry of Industry.
          -   Approving the engineering charts from the Engineers Association
          -   Administrative permit / Al-Rekkah Governorate – Technical Services
          -   Ecological consent / Al-Rekkah Governorate – Directorate of Environment




                                                    294
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Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




                                       A Summary of a Feasibility Study
                                       A Factory of producing dry yeast
                                           AL -rekah Governorate
               About the project:
                The project is listed under the projects of food industries.
                It aims at producing dry yeasts packed in containers of
                different weights to meet the requirements of baking for
                the families and for the producers in the public and public
                sector alike.
                Dry yeast is considered the most important factor in the
                industry of baked materials, where it guarantees the
                success of baked materials. The project is suggested to be
                in Arrekah.
                This summary includes: marketing study, technical study, financial study.

          First: Marketing Study:
                 Product & quality:
                  Dry yeast is the outcome of nutritional fermentation which results from the change
                  of organic materials by the activity of the secreted enzymes via bacteria or any
                  other cells into simple products under air or non-air fermentation circumstances.
                  The Syrian standard specifications No. 134/1990 identified the conditions which
                  must be available in the dry yeast which is manufactured for preparing bread and
                  pastry as follows:
              -   Physical specifications: separated granules of light brown color.
              -   Chemical specifications: The rate of dew and ash must not exceed 8% and 8.6%
                  successively.
              -   Biological specifications: The rate of strange cells must not exceed 3% , and the
                  validity must not be less than one year.

                 Study of demand:
                  The demand for dry yeast usually arises from bakeries, sweets and pastry stores
                  (main consumers), in addition to usual consumption of families. The annual need of
                  soft yeast is nearly 38,000 tons, and dry yeast 1,000 tons.

                 Study of supply:
                  Dry yeast is not produced in Syria. It is imported and packed
                  within containers of nylon and carton of different sizes.
                  Bakeries are supplied with yeasts in special nylon bags

          
              Syrian Specifications and Standards Agency
          
              Estimations of the General Establishment of Sugar
                                                             295
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Investment Opportunities Guide
                                                                                                        Beat Al khebrah
                                                                                                                      Syria 2011
                                                                                               Consulting & Studies of Economic
                                                                         




             Gap between demand and supply:
              The annual gap between the supply and the demand is estimated at 1,000 tons. It
              represents the whole need of the Syrian market, where it is currently imported and
              packed locally, and then it is launched in the market.

             Competition & competitors:
              At present, there is no real competitor to the project. The prospective competition
              will be from the two companies of the public sector (Damascus Yeast Company,
              Aleppo Yeast Company) in case they expand their activity, in addition to the
              possibility of the entrance of a new investor to the market.

             Strategies of sale and distribution:
          -   Local markets: 80% of the product, because pastry is a food material eaten by the
              Syrians, especially in the countryside.
          -   Regional and international markets: (Gulf states, Iraq, Turkey the European
              Union …) at a rate of 20% of the product, because of the similarity in the food
              habits with regard to the pastry.

           SWOT:
          a. Opportunities and points of strength:
          - The inexistence of a competitor in the Syrian market and the inexistence of an
             active alternative to the yeast.
          - The availability of raw materials in extremely reasonable prices.
          - The expectation of the development of demand due to its relation with the growth
             of inhabitants, and because the Syrian people largely depend on baked food.

          b. Threats and points of weakness:
          - The limited validity of yeast.
          - The exactness of the production process which depends on certain nutritional and
             chemical components with studied rates.

             Revenues of project:
              The annual revenues of the project for producing 800 tons of dry yeast are SYP
              116,000,000. The price of one kilogram of dry yeast is SYP 145 on average.

          Second: Technical Study:
           Technical description of project:
          a. Location: Arrekah governorate, where the main raw
             material of the project is available due to the existence
             sugar beet whose molas is the most important
             outcome, in addition to the availability of cheap labor.

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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




          b. Land & Building: (SYP 18,000,000)
             The project will be built on a piece of land of 2 dunams (2,000m2). The building is
             1000 m2. The value of the piece of land is SYP 3,000,000, while the value of the
             building is SYP 15,000,000.

          c. Machinery and equipment: (SYP 57,000,000 of a European origin)
             The project consists of the following main machines:
             - The main fermenting machine and the air fermenting machine.
             - Air filter
             - Various tanks (fermenting, gathering, cooling ….).
             - Organizer and a gouge of PH, an organizer and a gouge of temperature.
             - A device for filtering the yeast and its liquid.
             - Air dryer.
             - A filling device with existence of carbon dioxide
             - A laboratory
          d. Means of transportation (SYP 2,000,000 )
          e. Furniture and furnishing: (SYP 500,000).
          f. Expenses of incorporation and licenses (SYP 2,500,000).

          g. Commodity requirements: (SYP 70,000,000).
          - Raw materials: (5,600 tons molas at a price of SYP 10,000/ ton ,315 tons ammonia
             at a price of SYP 21,000/ton, chemical materials in addition to packing and
             packaging materials and requirements of carbon dioxide): SYP 65,500,000.
          - Other commodity requirements (electricity, water, fuel): SYP 4,500,000.
          h. Service requirements: (maintenance, mail, telephone, advertisement, promotion,
             SYP 2,500,000).

          i. Administrative structure - salaries and wages:
             The administrative and organizational structure of the project consists of:
               - Production department: It is responsible for all stages of the production
                    process, in addition to monitoring and quality.
               - Purchases and sales department: It is responsible for drawing up the
                    advertisement and promotional polices as well as supervising the processes of
                    distribution, sales and supplying raw materials.
               - Human resources and finance department: It comprises the financial
                    directorate, personal affairs directorate, drivers and workers.
             The employment needed for the project is estimated at 25 workers with one shift,
             distributed to 5 administrative officials, 20, technicians, maintenance, guards. The
             total cost of salaries and wages, including social insurances, is estimated at SYP
             7,500,000.


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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




          Third: Financial Study:
             Estimation of investment costs:
          -   Fixed capital: SYP 80,000,000
          -   Working capital: SYP 20,000,000.

             Estimation of annual operating costs:
          -   Commodity requirements (supplies): SYP 70,000,000
          -   Service requirements: SYP 2,500,000
          -   Wages and employment: SYP 7,500,000
          -   Depreciations: SYP: 7,450,000
              Variable costs are estimated at SYP 75,000,000, and fixed costs are estimated at
              SYP 12,450,000.

             Economic and financial analysis of project:
          -   Total investment costs = SYP 100,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) = SYP
              145,903,000.
          -   Total annual costs (the average lifetime of the project is 10 years) =SYP
              106,784,000.
              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project.

              Economic parameters of project:
               a. Annual gross profits                                  = SYP 46,569,000
               b. Net profits                                           = SYP 39,119,000
               c. Pay-back period                                      = 2.1 years
               d. Rate of return of capital (investment)            = 47%
               e. Net present value at a discount rate of 15% = SYP 104,195,341
               f. Break-even point                                    = 24% = SYP 35,016,853
               g. Internal rate of return                            = 39.4%
               h. Added value                                         = SYP 46,000,000
          The project is largely sensitive towards the fall of its revenues, where the internal rate of
          return decreases to 23% in case the revenues decrease 20%.

             Most important required permits:
          -   Licensing under law No. /8/ Syrian Investment Agency.
          -   Industrial permit / Ministry of Industry.
          -   Administrative permit / Alrekah governorate – Technical Services
          -   Ecological consent / Alrekah governorate – Directorate of Environment
          -   Rectifying the engineering charts from the syndicate of engineers.

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Investment Opportunities Guide
                                                                                                            Beat Al khebrah
                                                                                                                          Syria 2011
                                                                                                   Consulting & Studies of Economic
                                                                             




                              A Summary of a Feasibility Study For
                     A Factory of Producing Yogurt and Cheese Automatically
                             Deir Ezzor Governorate /Industrial City/

               About the project:
                The project is listed under the projects of food
                industries whose aim is to produce the derivatives of
                milk. Deir Ezzor was chosen for building this project
                for being the richest Syrian governorate in milk cows
                (21% of cows in Syria), and the richest in the surplus
                of cheap fat milk (SYP 11 per kg versus SYP 25 in
                other governorates.

                  This summary of this study includes: marketing study, technical study and financial
                  study.

          First: Marketing Study:
                 Product & quality:
                  The products of the project (cow's ghee, white cheese, and yoghurt) must be:
              -   Animal ghee: It should be yellowish, creamy, and homogeneous, with a
                  distinguished smell and taste.
              -   White cheese: It should be fresh, coherent with homogeneous consistency, white
                  color or white yellowish color.
              -   Yogurt: It should be homogeneous, white or creamy, free of alien taste.

                 Study of the demand
                  The demand for the products of the project is characterized by the permanence
                  because they are main foods to the Syrian citizen. The demand can be estimated as
                  follows:
              -   Animal ghee: 20,866,000 the population of Syria in the end of 2010 X 32 g the
                  monthly average consumption of ghee per capita X 12 months = 8,013 tons per
                  year.
              -   White cheese: 20,866,000 inhabitants X 358 g X 12 months = 89,640 tons per year
              -   Yogurt: 20,866,000 inhabitants X 266 g X 12 months= 66,604 tons per year

                 The study of supply:
                  The following table reflects Syria’s production of cow milk derivatives in 2009
                        Products             Mil      Cow fat      White cheese                        Yogurt
                       Product/ton        1,600,269    6,382         52,826                            39,136



          
              Statistic group 2010
          
              Family costs survey 2009-2010
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




               The production of milk in Deir Ezzor governorate is estimated at 286,556 tons, i.e.
               19% of the production of Syria. As said earlier, the price of one kilogram of milk in
               Deir Ezzor is SYP 11, while it is 20 - 25 in the other governorates.

              The gap between the demand and the supply:
               The afore mentioned data indicates a clear gap in favor of the demand for the
               studied products. It is estimated at 1,630 tons of ghee, 36,814 tons of white cheese
               and 30,468 of yogurt. This gap is currently covered by depending on the products
               of sheep milk in spring and the home-made product, in addition to importing from
               the neighboring countries.

              Competition & competitors:
               There are 344 establishments producing milk derivatives in Syria. Nearly 106 of
               which are industrial and registered, in addition to 238 professional workshops:
          -    Private sector: Al-Ariaf, Hana, Gody, Milkman, Al-Shark.
          -    Public sector: Dairy Syrian Company (Damascus), Homs Dairy Company.
          -    Mixed sector: Saudi Syrian Company, Finland Syrian Company.
               There are 39 professional workshops working with a small production capacity of
               no more than 2 tons. The most important of which is ADDulaimi works shop.

              Strategies of sale and distribution:
          -    Local markets: The products of the project will be fully distributed in the local
               markets.

              SWOT:
          a.   Opportunities and points of strength:
          -    The closeness to the sources of fatty cheap raw materials.
          -    The increasing demand for the derivatives of milk.
          -    The littleness of local factories and the limitedness of their
               production.

          b. Threats and points of weakness:
          - The instability of the prices of the derivatives of milk because they are linked with
             the prices of cow fodder.
          - The decrease of the demand in some governorates which prefer sheep milk
             derivatives to the products of the project.

              Revenues of the project:
               The revenues of the project are estimated at SYP 153,200,000 with a daily
               production capacity of 20 tons for 300 workdays distributed as follows: 50% fat,
               30% cheese. 20% yogurt.



                                                     300
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                       Product         Qty/ton      Price ton/SYP       Annual revenues
                   Cow ghee              210           250,000             52,500,000
                   White cheese          360            90,000             32,400,000
                   Yogurt               1,020           65,000             66,300,000
                    cottage cheese                                          2,000,000
                   total                                                  153,200,000

               Notices:
               - The coefficient of the transmutation of 100 kg milk/ 1 fat.
               - The coefficient of the transformation of 5 kg milk/1 cheese.
               - The coefficient of the transformation of 2.25 kg milk / 1 yogurt.
               - The rate of the transference from the artisan association of milk and cheese.
               - Prices of the competitive products on the country’s level.

          Second: Technical Study:
           Technical description of the project:
          a. Location: The industrial city, Deir Ezzor where raw
             materials (milk) are available with low prices.

          b. Land &Building: (SYP 25.950,000)
             The project needs a piece of land of 3 donums at a cost of
             SYP 1,950,000 and a building comprising the
             administrative department, production department,
             cooling rooms, and a quality test center with an estimated cost of SYP 24,000,000.

          c.   Machinery and equipment: (SYP 38,000,000 of Turkish origin)
          -    A unit of receiving milk.
          -    Insulated tanks for keeping milk, a pasteurization, sterilization and sorting machine
          -    A cooling room, laboratory, basins for collecting the product.

          d. Means of transportation (SYP 7,000,000): refrigerating cars, service cars, a
             microbus for transporting the workers.
          e. Furniture and furnishing: (SYP 500,000).
          f. Expenses of incorporation and licenses (SYP 3,550,000).
          g. Commodity requirements: (SYP 98,000,000).
          - Raw materials: (6,400 tons milk, materials for making cheese, salt, detergents,
             packing and packaging materials, …) = SYP 93,000,000.
             Notice: 400 tons are counted waste and discharge, and the price of milk as a
             precautionary is SYP 12 instead of 10 – 11 expecting a rise of prices.
          - Other commodity requirements (electricity, water, industrial fuel): SYP 5,000,000.
          h. Service requirements: SYP 6,000,000.



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Investment Opportunities Guide
                                                                                                       Beat Al khebrah
                                                                                                                     Syria 2011
                                                                                              Consulting & Studies of Economic
                                                                        




          i. The organizational structure, salaries and wages:
             The organizational structure of the project consists of:
             - Production department: It is responsible for all stages of the production process
                and controlling quality.
             - Marketing and sales department: It is responsible for selling, purchasing,
                supplying raw materials and supervising the processes of promotion, selling and
                distribution.
             - Administrative and financial department: It is responsible for following up the
                staff affairs, wages and salaries.
             The employment needed for the project is estimated at 30 workers with one shift,
             distributed to 10 administrative officials and 20 technicians. The total cost of
             salaries and wages, including social insurances, is estimated at SYP 7,000,000.

          Third: Financial Study:
             Investment costs are estimated as follows:
          -   Fixed capital: SYP 75,000,000.
          -   Working capital: SYP 20,000,000.

             Annual operating costs are estimated as follows:
          -   Commodity requirements: SYP 98,000,000.
          -   Service requirements: SYP 6,000,000.
          -   Wages and employment: SYP 7,000,000.
          -   Depreciations: SYP: 7,210,000.
              Variable costs are estimated at SYP 105,000,000, and fixed costs are estimated at
              SYP 12,610,000.

             Economic and financial analysis of the project:
          -   Total investment costs = SYP 95,000,000.
          -   Value of annual revenues = (the average lifetime of the project is 10 years) =
              SYP 192,693,000.
          -   Total annual costs (the average lifetime of the project is 10 years) =
              SYP 145,432,000.
              Notice: Revenues and costs are raised 5% during the production lifetime of the
              project.

             Economic parameters of the project:
              a. Annual gross profits                          = SYP 54,471,000.
              b. Net profits                                   = SYP 47,261,000.
              c. Pay-back period                               = 1.7 years
              d. Rate of return of capital (investment)         = 57%
              e. Net present value at a discount rate of 15%   = SYP 141,080,902.
              f. Break-even point                                 = 21% (SYP 40,465,530).

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Investment Opportunities Guide
                                                                                                             Beat Al khebrah
                                                                                                                           Syria 2011
                                                                                                    Consulting & Studies of Economic
                                                                              




                g. Internal rate of return                         = 48.4%
                h. Added value                                     = SYP 55,200,000.

               The project is largely sensitive towards the fall of its revenues. If they fall at a rate
               of 20%, the internal rate of return decreases to 9.6%.

              Most required permits:
              - Industrial permit
              - Licensing under law No. /8/ Syrian Investment Agency.
              - Subscription and allotment
              - Building license
              - Administrative permit and ecological consent.

               The industrial cities include the service of the one stop shop, which provides all
               these permits.




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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




                             A Summary of a Feasibility Study
             A Factory of refinery and purification of edible and industrial salt
                         Deir Ezzor Governorate /Industrial City/
           About the project:
            The rocky salt mines and the surface salinas are
            considered the two main sources of salt production in
            Syria. The General Establishment of Geology is still
            the only party responsible for the extraction of salt
            since 1969.
            There are many of large Salinas in Syria, the most
            important are the rocky salt mine in Al Tibni area of
            Deir Al Zour with reserves estimated at about /30/ million tons, and salinas of Al
            Bawarh, Al Jabbul, Al jbisa and Palmyra. The purity of the salt layer is between 80-
            99% sodium chloride. There is a particular need for this project in the Eastern
            Region (Deir Al Zour) due to the availability of the raw material and the inability of
            local products to meet market needs.
            This summary of feasibility study includes: marketing, technical and financial
            studies.

          First: Marketing Study:
            Product & quality:
              The project aims at extracting and refining rocky salt by dissolving the salt with
              water to form a saturated solution called the brine, which sedimented, chemically
              treated to remove impurities, then the brine is filtrated and water content evaporated
              for crystallization. The crystals are centrifugally detached and dried, part of which
              treated with iodine for food and the other part for industrial uses. Syria produces
              about 80 thousand tons of iodized salt per year for human consumption of table salt
              and ovens in addition to industrial purposes.

            Study of demand:
              The salt is used in various high precision industries as
              an electrolysis parameter, in addition to food,
              pharmaceutical, laboratory and tanning industries, and
              salt templates that utilized to increase milk production
              in cow farms. Syria imported /181/ thousand tons of
              normal salt and sodium chloride in 2009 valued at
              SYP /280/ million. Viewing the present local
              production which amounts to an average of about /80/
              thousand tons, the country need from this material is
              about /280/ thousand tons per year, with a population

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Investment Opportunities Guide
                                                                                                           Beat Al khebrah
                                                                                                                         Syria 2011
                                                                                                  Consulting & Studies of Economic
                                                                            




                 of 20,866,000 inhabitants in 2011. The average annual share per capita of table and
                 industrial salts is about (13.5) kg.

               Study of supply:
                 The following table shows the sequence of the domestic production of salt by year
                 rule, according to data from the Central Bureau of Statistics:
                               Year                  2005     2006       2007   2008     2009
                    Production (thousand tons)        110      137        81     89       78
                 However, extraction of salt from Deir Al Zour Mine in Syria began in 1969 by
                 Department of Rocky Salt Mines.

               Gap between demand and supply:
                 There is an obvious disparity between the size of demand and the annual local
                 production quantities, where the domestic product secures about (65%), and
                 imports about (35%) of the annual country need. Consequently, the project will
                 work on plugging the existing deficit (that expected to increase), with the
                 possibility of exporting to neighboring countries which will create reasonable
                 profits to the project.

               Competition & competitors:
                 Shares of domestic production are distributed to: (60%) secured by Deir Al Zour
                 Mine and the rest by surface salinas. Production techniques are still old and
                 inefficient in economic terms. Salinas of Palmyra intend to be invested in future
                 through the establishment of a corporation company at an estimated production of
                 about /80/ thousand tons per year.

               Strategies of sale and distribution:
                 - Domestic market: (Damascus, Rural
                      Damascus, Aleppo, Hama, Homs,
                      Tartous) at a rate of (80%) of
                      production, and most of the consumption
                      is in the industrial sector.
                  -    Regional markets: there is a possibility
                      to export to neighboring countries (20%)
                      of production, due to the quality of local
                      salt and the degree of purity.



          
              Records of the General Establishment of Geology 2010
          
              Data of the General Company of Geology 2010
                                                        305
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




            (SWOT):
              a. Opportunities and Strengths:
                 - Availability of raw materials for cheap prices.
                 - Increasing growth in demand for the product to its importance in industrial
                   uses.
                 - The establishment of the factory site close to the place of availability of raw
                   materials, where means of transport and water necessary for the project and
                   employment are available.
                 - Joining the Arab Free Trade Area, which gives Syria competitive export
                   opportunities.

              b. Threats and points of weakness:
                 - Dusty weather in the Eastern Region which affects the purity of the product.

            Revenues of project:
              Annual revenues of the project for the production of (65 000) tons of industrial salt
              and bag-packed table salt estimated at SYP 65,000,000, where the average price per
              ton is SYP 1000.

              Second: Technical Study:
            Technical description of the project:
              a. Location: Al Tibni area is located (50) km west of Deir Al Zour, where the
              General Establishment of Geology has another site nearby the mine currently
              exists. it is one of the important sites due to availability of the necessary water
              through the Euphrates River. The location is about / 100 / m above the Euphrates’s
              level, and /300/ m above sea level. The depth of the salt layer is /165/ m bellow the
              ground surface.

              b. Land & Building: (SYP 5,000,000) Building will be established according to an
              internal plan commensurate with the requirements of the production process, the
              environmental conditions and quality control of salt. It is expected that the cost of
              the building is SYP (5) million, meanwhile the land would be rented and will be
              dealt with in the service requirements.

              c. Machinery and equipment: SYP (38,500,000 Turkish or Chinese origin).
              The project consists of the production line as follows:
              - Chrome tanks and stainless steel spiral equipment to transfer salt.
              - Equipment for washing salt and accessories, and basins for purification and
                dissolving.
              - Equipment for drying, milling, sorting, screening and adding iodine.
               Filtration, packaging and laboratory equipments and pumps.
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Investment Opportunities Guide
                                                                                                         Beat Al khebrah
                                                                                                                       Syria 2011
                                                                                                Consulting & Studies of Economic
                                                                          




              - Wind turbines.
              d. Means of production and service transportation: SYP (5,000,000).
              e. Furniture and furnishings: SYP (500,000).
              f. Expenses of incorporation and licenses: SYP (3,500,000).
              g. Commodity requirements /supplies:
              SYP(18,000,000).
              - Raw materials (iodine, packing and packaging
              materials): SYP / 12,000,000 /.
              - Other commodity requirements (electricity +
              water + fuel): SYP / 6,000,000 /.

              i. Service       requirements     (land      rent,
                 maintenance, telephone, advertising): SYP
                 (6,000,000).
              j. Administrative structure, salaries and
                 wages:
                 The administrative and organizational structure of the project Consists of:
                   - Production department : dealing with the different stages of the production
                     process.
                   - Promotion and sales department: dealing with processes of distribution,
                     selling, storage, marketing and setting the advertising and promotional
                     policies.
                   - Administration and Finance department: dealing with the personnel,
                     financial and accounting affairs and services (drivers, guards, services,
                     workers, ..).

              The estimated need of employment (55 workers, one shift) are distributed to /5/
              administration officials, /23/ technicians and specialists and /27/ ordinary workers,
              drivers and guards.

              The total cost of salaries and wages including social security estimated at SYP
              /12,000,000 /.

           Third: Financial Study:
           • Estimation of investment costs:
           - Fixed capital    : SYP 53,000,0000.
           - Working capital : SYP 12
           • Estimation of annual operating costs:
           - Commodity requirements        : SYP 18,000,000.
           - Service requirements          : SYP 6,000,000.

                                                    307
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Investment Opportunities Guide
                                                                                                          Beat Al khebrah
                                                                                                                        Syria 2011
                                                                                                 Consulting & Studies of Economic
                                                                           




           - Wages and employment            : SYP 12,000,000.
           - Depreciation                    : SYP 5,925,000.

           The variable costs estimated at SYP 27,600,000, and fixed costs to SYP 14,325,000.

           • Economic and financial analysis of the project:
           - Total investment costs : SYP 65,000,000.
           - Value of annual revenues (the average lifetime of the project is 10 years) =
              SYP 74,515,000.
           - Total annual costs (the average lifetime of the project is 10 years) = SYP 47,462,000.

          Notice: Revenues increased annually at a rate of 3% and costs at a rate of 4% during the
          production lifetime of the project.

          • Economic parameters of project:
               Total annual profits = SYP 32,978,000.
              b. Net profits = SYP 27,053,000.
              c. Pay-back period of invested capital = 2 years.
              d. Rate of return of capital (investment) = 51%
              e. Net present value at a discount rate of 15% = SYP 83,014,537
              f. Break-even point in the project = 35% (SYP 26,080,250)
              g. Internal rate of return (IRR) = 46.1%
              h. Added value of the project = SYP 47,000,000.

           The project is largely sensitive towards the fall of the revenues at a rate of 20%,
            where the internal rate of return falls to 23.4%.

          • Most important required permits:
            - Licensing under law No. /8/ Investment Commission.
            - A contract with the General Establishment of Geology for the rental of land and
              quarries investment.
            - Industrial permit / Ministry of Industry.
            - Administrative permit (Deir Al Zour – Governorate- Directorate of Technical
              Services).
            - Ecological consent (Deir Al Zour Governorate -Environment Department).




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Investment Opportunities Guide
                                                                                                                      Beat Al khebrah
                                                                                                                                    Syria 2011