After Nuclear Deal, Iran Looks to Profit in Syria

After Nuclear Deal, Iran Looks to Profit in Syria

Tony Badran, Saeed Ghasseminejad
19th March 2017 - The Cipher Brief

The Islamic Revolutionary Guard Corps, Iran’s powerful, ideological military force, is one of the country’s most influential institutions, with major stakes in key sectors of the economy and supervision of Tehran’s vast network of militias and terrorist proxies in conflicts throughout the Middle East. In its eagerness to secure the 2015 Iran nuclear deal, however, the Obama Administration turned a blind eye to IRGC involvement in the Syrian civil war, and as the Trump Administration now ponders its options, the IRGC is looking to turn its investment in Syria into profits.

In January, Iran signed five economic memorandums of understanding with Syria, which gave Iran important assets in Syria and expanded the IRGC’s clout in the war-torn country. One of the agreements grants the Mobile Telecommunication Company of Iran (MCI), a company controlled by the IRGC and Iranian Supreme Leader Ayatollah Ali Khamenei, a license to operate a mobile network in Syria. 

MCI is a subsidiary of the Telecommunication Company of Iran (TCI), which is owned by Tosee Etemad Mobin Company (TEMC). TEMC, in turn, is jointly held by the IRGC and by two Khamenei-controlled entities: the Mostazafan Foundation and the Execution of Imam Khomeini’s Order, a shadowy $95 billion network of foundations that was sanctioned by the United States until the nuclear deal went into effect.

MCI joins two existing mobile operators in Syria: the U.S.-sanctioned SyriaTel, owned by Rami Makhlouf  – the cousin of Syrian President Bashar al-Assad and himself under U.S. sanctions – and MTN Syria, a subsidiary of the South African MTN Group.

According to the business and economics website The Syria Report, MCI will partner in Syria with local businessman Muhammad Hamsho to provide mobile services. In 2011, the U.S. Treasury Department sanctioned Hamsho for being a close business associate of Maher Assad, President Assad's brother.

Marrying military and economic ventures is characteristic for the IRGC. In 2015, for example, telecommunication devices made by Mobin Electronic, a TEMC shareholder, were captured by Syrian rebels from Iranian-led forces on the battlefield in the countryside around the then-fiercely contested Syrian city of Aleppo. Such companies are part of the IRGC financial empire, but in many cases they have a dual purpose, playing a role in support of IRGC military efforts.

More broadly, combining military and economic projects is part of the IRGC’s plan for cementing its long-term position in Syria. This strategy also follows a set template undertaken by the Islamic Republic for exporting its revolutionary model, which calls for economic and cultural projects to be accompanied by military ones. Through such measures, Iran can establish a holistic network of revolutionary institutions, as has been the case in Lebanon.

Similarly, it’s reasonable to assume the IRGC’s (and even Hezbollah’s) construction arms will be involved in reconstruction efforts in areas controlled by the Assad regime. Indeed, commenting on the newly-signed agreements, the advisor to the Iranian foreign minister Hossein Sheikholeslam, boasted that given “the long-term close relationship between Iran and the Syrian authorities, Iran was able to actively enter into the reconstruction process.” In addition, the Assad regime has said explicitly that Iranian and Russian firms would get priority in any reconstruction efforts.

That’s hardly all. Along with MCI’s mobile license, Iran was granted leases on 12,000 acres of land in Homs and Tartous provinces to construct oil and gas terminals, and a long-term lease to develop the Sharqiya phosphate mines in eastern Homs province. The Syrian regime will award another 12,000 acres of farmland to Iranian agricultural companies, and, according to The Syria Report, a sixth agreement will transfer management of an unspecified maritime port to an Iranian company.

The nuclear deal not only provided Iran with cash, but has also led Washington to give it a free hand in the region, especially in Syria, lest the deal be imperiled. The IRGC, which has spared no effort in fighting for Assad, is now getting returns on its investment.

The Trump Administration, as it considers how to approach the nuclear deal and address Iranian subversion in the region, is reportedly weighing the designation of the IRGC as a terrorist organization. That’s long overdue. But the Administration would do well to expand its designation of IRGC entities as well. Targeting MCI, as part of countering broader IRGC ventures in Syria, is an obvious place to start.

Tony Badran is a senior fellow at the Foundation for Defense of Democracies. Follow him on Twitter @AcrossTheyBaySaeed Ghasseminejad, an associate fellow at the Foundation for the Defense of Democracies, contributed to this article. 

Tags

iran, irgc, jcpoa, syria