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📰 Europe visits Syria post-Assad

📰 Europe visits Syria post-Assad

and South Korea’s standoff

Ross Crabtree & Billy Robinson
January 03, 2025

Hello and welcome to Geopolitics Daily,

Trade tensions escalate between Washington and Beijing as China enforces a dual-use export ban targeting U.S. defence contractors, while the U.S. considers restricting or banning drones incorporating Chinese technology.

Elsewhere, French and German foreign ministers make a historic visit to Damascus, marking the first high-level European engagement since the fall of Assad. Today’s leading story examines the future of Iran-Syria relations, focusing on Syria’s enormous debt and financial entanglements with Tehran.

More details below ⤵️

Top 5 Stories

1️⃣ 🇷🇺 🇺🇦 🇲🇩 Russia’s Transnistria gas facilities shut down: The suspension of Russian gas supplies to Transnistria has forced the shutdown of nearly all industrial operations in the region, except for food producers. This breakaway territory of 450,000 people, which separated from Moldova in the 1990s, felt immediate economic strain following the disruption of Russian gas flow through Ukraine. Sergei Obolonik, Transnistria’s first deputy prime minister, warned that prolonged shortages could permanently disable local industries. The gas cutoff comes as Ukraine declines to renew a transit deal with Russia, ending an arrangement that brought Kyiv around $1 billion annually despite ongoing conflict.

2️⃣ 🇨🇳 🇺🇸 China implements dual-use export ban on U.S. defence contractors: China has imposed export controls on 28 U.S. companies, including major defence contractors like Lockheed Martin, Raytheon, and Boeing, in response to escalating trade tensions. Chinese firms are now barred from selling dual-use goods to these entities, citing national security concerns. Additionally, 10 of these companies were placed on China’s "unreliable entities" list, restricting imports, exports, and investments, while revoking travel and residency permits for executives. Beijing’s actions follow U.S. sanctions targeting Chinese firms and technology, reflecting a tit-for-tat dynamic between the two nations. Despite the sanctions, experts suggest the immediate impact on U.S. defence contractors will be minimal, as they have limited business dealings with China.

3️⃣ 🇮🇶 🇧🇭 Iraq becoming hub for Shia dissidents from the Gulf, says Amwaj: Iraq has become a refuge for Gulf Arab opposition groups over the past decade, potentially complicating its efforts to strengthen ties with neighbouring states. Shiite dissidents, some relocating from European exile, have steadily gravitated toward Iraq, drawn by its political environment. This shift reportedly began in 2013 under former Prime Minister Nouri al-Maliki, who engaged with Saudi opposition forces in Europe, facilitated by Islamic institutions. Bahrain remains particularly concerned, citing Iraqi-based dissidents as a security threat, especially following the 2011 crackdown in Manama. Iraq’s future approach to hosting Gulf opposition figures will likely hinge on the progress of regional reconciliation efforts and Baghdad’s evolving diplomatic priorities.

4️⃣ 🇺🇸 🇨🇳 U.S. looks to restrict or ban drones with Chinese technology: The Biden administration is weighing new regulations to exclude China from the US drone supply chain, marking another step in the ongoing economic and technological decoupling between the two powers. The US Department of Commerce’s Bureau of Industry and Security (BIS) announced plans to gather public input by March 4 on potential risks tied to Chinese and Russian involvement in the drone sector. The Commerce Department warned that Chinese and Russian-linked technology could enable adversaries to access sensitive US data, heightening security risks. The BIS is also exploring whether certain safeguards could mitigate these threats, allowing continued market participation under stricter conditions.

5️⃣ 🇰🇷 Investigators forced to abandon attempt to arrest impeached president Yoon: South Korea’s political crisis escalated on Friday when investigators abandoned an attempt to arrest impeached President Yoon Suk Yeol after a tense standoff with his security forces. Anti-corruption officials, who entered the presidential compound in Seoul, suspended their efforts, citing safety concerns following hours of deadlock. The arrest warrant accuses Yoon of insurrection over his December martial law declaration, but officials have not confirmed if they will make another attempt before it expires on Monday. The confrontation unfolded as 1,200 of Yoon’s supporters rallied outside his residence, while inside, security forces blocked the joint team of police, prosecutors, and investigators.

Major Story

🇮🇷 🇸🇾 IRAN AND SYRIA: ECONOMIC STAKES, MOUNTING DEBT, AND POLITICAL RAMIFICATIONS

As Syria transitions beyond Bashar al-Assad’s rule, Tehran faces growing uncertainty over whether Damascus will honour the extensive financial and military support Iran has provided over the past 14 years. Estimates suggest Iran’s backing of Assad, including oil shipments, weapons, and industrial goods, has amounted to between $30 billion and $50 billion. Despite no official records, Iranian officials and Syrian opposition figures agree on the scale of the debt, raising questions about future repayment.

Oil Shipments and Military Aid

One major aspect of Iran’s support has been the continuous export of crude oil, averaging 60,000 barrels per day since 2011. This alone could amount to $14 billion by 2024, based on a conservative estimate of $50 per barrel. Alongside oil, Tehran’s provision of arms and petrochemicals has further deepened Syria’s debt. However, much of this aid may have indirectly supported Hizbollah, complicating repayment prospects.

Political and Social Ramifications

As Syria’s new leadership navigates its alliances, Tehran fears a pivot towards hostility, potentially jeopardizing Iran’s investments. The situation has ignited debate within Iran, with growing calls to prioritise domestic needs over regional entanglements. If Syria shifts allegiances, Iran may face significant economic and political fallout from its long-standing involvement in the conflict.

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Other News

1️⃣ 🇫🇷🇩🇪🇸🇾 French, German foreign ministers visit post-Assad Syria: The French and German foreign ministers have arrived in Damascus, marking the first visit by European officials to Syria since diplomatic ties with the EU were severed over a decade ago, Germany’s Foreign Ministry announced. German Foreign Minister Annalena Baerbock and her French counterpart, Jean-Noel Barrot, will meet with Ahmed Sharaa, Syria’s new leader, and civil society representatives. The visit signals EU support for Syria’s political transition, reconstruction, and reconciliation following the fall of Bashar al-Assad’s regime. Baerbock emphasized Syria’s opportunity for renewal, while Barrot highlighted the EU’s commitment to fostering a peaceful transition and long-term stability in the region.