The Syrian government has successfully annulled a 2019 agreement with Russian company Stroytransgaz (STG) to manage the strategic port of Tartus, citing breaches of contract and the firm’s failure to meet its obligations.
This legal move is part of Syria’s broader strategy to reduce direct Russian influence through legal channels, avoiding confrontation with Moscow, which remains preoccupied with the war in Ukraine and appears willing to acquiesce to such adjustments without escalating tensions.
The cancellation, carried out with the assistance of local lawyers and a European international law firm specialising in public international law, paves the way for the current Syrian administration to implement its May agreement with Dubai Ports World to manage the port.
According to an official statement, the agreement with the Russian company was terminated due to a “material breach of contract,” including the company’s failure to invest the promised $500 million in modernising port infrastructure and neglecting maintenance of vital equipment.
The Syrian government also criticised the deal as “unfair to Syrian sovereignty,” noting that STG received 65 percent of revenues while Syria was limited to 35 percent, alongside Russian control of the port’s board of directors.
Further reasons for cancellation included the “lack of genuine fulfilment” of contractual obligations, with no significant upgrades to infrastructure, poor maintenance, and bureaucratic hurdles undermining the port’s operation and Syria’s interests.
Tartus, one of Syria’s largest ports strategically situated on the Mediterranean, plays a crucial role in revitalising maritime trade, serving as an export hub for agricultural products, oil, grain and other commodities.
Syria’s coastline stretches 65 kilometres from the Turkish border in the north to Lebanon in the south and includes five main ports: Latakia (the largest), Tartus, Jableh, Banyas, and Arwad, all overseen by the General Authority for Land and Maritime Ports.
In May, Syria signed a landmark agreement with Dubai Ports World to develop and operate the Tartus port, signalling a strategic shift towards upgrading port infrastructure and logistics, following a similar deal with French shipping giant CMA CGM to develop Latakia port.
The $800 million memorandum of understanding with Dubai Ports World involves a comprehensive investment in the development, management, and operation of a multipurpose container terminal at Tartus, aimed at improving port efficiency and increasing capacity.
The agreement also encompasses cooperation on establishing industrial and free zones, dry ports, and cargo transit centres in several strategic locations across Syria.
In April 2019, Russian Deputy Prime Minister Yuri Borisov announced after meeting President Assad in Damascus that Russia would lease Tartus port for 49 years for transport and economic purposes.
Borisov said, “A key issue that is to yield positive dynamics is the one on the use of the port of Tartus. My visit has cemented all these agreements. We have made considerable progress on that matter and hope that a contract will be signed within a week and the port of Tartus will be used by Russian businesses for 49 years.”
