Egypt and Germany showed up at the Damascus fair. Saudi signed actual deals.

Egypt and Germany turned up to Syria’s biggest business event of the year to court the market. Saudi Arabia turned up to sign contracts. The Damascus International Fair — running from 26 August to 4 September, with some 1k participants from 60 countries — is a snapshot of tiered foreign engagement in Syria’s reconstruction, with Riyadh moving ahead of most other foreign delegations on the ground.

The new showers

Egypt fielded a cross-industry showing spanning food, agriculture, and engineering, Sana reports. Wahat Al-Kunuz, Obour, and Rayyan are among the exhibitors, and Obour export director Mohamed Abdel Wahhab told Sana the company is using B2B meetings in a bid to sign Syrian companies as local agents after a period of absence from the market.

Germany brought 13 companies across consulting, engineering, logistics, medical technology, energy, and fiber optics, Sana reports. Lead-acid battery maker BAE Batterien is eying a return to Syria after 18 years and now says the country commands more of its attention than any other in the region, CEO Jan Ijspeert tells Sana. A high-level German economic delegation led by BMZ State Secretary Niels Annen is due in Damascus a week after the fair opens, a German Economy Ministry spokesperson told the agency.

Saudi leads the pack

But Saudi Arabia is the one leaving with paperwork. More than 50 Saudi companies and four government bodies — including the Saudi Export Development Authority, the Saudi Export-Import Bank, and the Industry Ministry — are at the fair. Syria’s Economy Ministry has already signed a 30-year MoU with Saudi’s Ithraa Group to rehabilitate and operate the Hama Steel Plant, targeting at least 350k tonnes of annual output within four years. That sits on top of last week’s four MoUs Riyadh signed on roads, rail, aviation, and postal services — with a six-month window to identify connection points and five-year implementation terms, Syria’s transport minister said.

The rail track is the most consequential. Riyadh and Ankara want to build a Gulf-to-Europe rail corridor through Jordan and Syria within three to four years, carrying goods, oil, gas, and passengers — a route that closes a roughly 400-km missing section between Syria and Jordan and depends on postwar Syria holding together. Turkey has committed around USD 100 mn to rebuild the route between its border and Aleppo, with a link onward to Damascus.

The data corridor is also in the works: A digital infrastructure agreement expected to be signed in Riyadh this week would connect submarine cables landing on Syria's coast to networks in Syria, Jordan, and Saudi Arabia, creating an alternative Europe-to-Asia data route running through to Oman.

Banking is next: The two countries agreed to launch a joint Saudi-Syrian bank. We previously flagged Saudi Arabia as the most likely entrant in Syria’s banking sector after Qatar — motivated by the need for a direct financial channel for Saudi capital pledges.

ALSO- Flynas Syria — a JV with Syrian Airlines — is close to launch after beginning licensing and recruitment, Syria’s civil aviation head Omar Al Hosari tells Asharq Business, with a launch expected before year-end. On postal, Syrian Communications Minister Abdul Salam Haykal told Asharq Business that Saudi companies have already submitted bids to develop Syria's postal service.

All of this stacks onto the reconstruction projects pipeline Saudi Arabia has been building since Investment Minister Khalid Al Falih’s February visit: The SAR 7.5 bn Aleppo International Airport redevelopment financed under the Elaf Fund, STC's national fiber-optic network, and a growing energy footprint that includes Al Harfi’s recent solar project win.

Background

Gulf capital — from the UAE, Qatar, and Saudi Arabia — with higher risk appetite and political backing, has been the first to show up in Syria, as purely commercially-driven capital remains cautious. Egypt’s turnout is the first test of how serious its private sector’s interest is, amid a top-level rapprochement between the two countries, we flagged earlier this month. Any official German moves in Syria could serve as a test-case for other European players — European players are showing interest but action is lagging, as banks remain “very restrictive and hesitant” on connecting with Syrian counterparts.

The main constraint hasn’t moved much. Banking friction, correspondent-bank hesitation, and the FATF gray listing still gate execution for everyone showing up in Damascus. Karam Shaar Advisory senior consultant Benjamin Fève has told us the highest priority is rebuilding confidence in the Syrian financial system so foreign correspondent banks reconnect — the missing piece that keeps trade finance, insurance, and profit repatriation challenging for private investors regardless of what MoUs get signed at the fair.