Syrian magnate denies buying Islamic State oil

5^min

A Syrian businessman facing European Union sanctions denied on Tuesday allegations that he bought oil from the Islamic State group for President Bashar Assad's government.

The EU put sanctions last week on George Haswani and six other prominent Syrian businessmen, freezing their assets and banning them from traveling to Europe. It also froze the assets of six companies also viewed as sponsors of the Syrian government.

Speaking to The Associated Press in his Damascus office, Haswani said the EU sanctions and accusations are politically motivated and said he is preparing to take unspecified legal action against the EU.

"There is no doubt that this unjust and political decision is not based on any evidence and I challenge them to put forward any proof or document that proves the reason behind the decision," he said. "This decision will lead to legal repercussions and the company and its reputation will be harmed, as well as its business. This is targeted damage for political reasons."

The EU said in its official journal that Haswani, co-owner of HESCO Engineering and Construction Co., a major engineering and construction company in Syria, has close ties to the government. It said he acts as "a middle man in deals for the purchase of oil from ISIL by the Syrian regime," referring to the Islamic State group by an alternate acronym.

The militants, who hold a third of Syria and neighboring Iraq, sell oil on the black market to help fund their conquests. Much of the oil is smuggled out of Islamic State-held territory in northern Syria to neighboring Turkey. Syrian opposition and Western officials long have accused Assad's government of secretly acquiring fuel from the group as well.

Haswani questioned why black market traders in Turkey don't face EU sanctions.

"Where did the oil from Daesh area, that is about 100,000 barrels a day, go? Everyone knows where it goes and where it is being sold," he said, using an Arabic acronym for the group. "How do they move and market oil through Turkey? Where are these traders and why aren't they being punished?"

He said his company is currently building a gas facility in north central Syria an area contested by the government and IS. This project, he said, "could be the reason behind the talk in the media about Daesh and oil buying and selling."

Syria's conflict began in March 2011 with largely peaceful protests before turning into a civil war. More than 220,000 people have been killed, nearly 4 million have fled the country and towns and cities have been reduced to rubble.

A report released Tuesday provided a stark assessment of the conflict's devastating impact on every facet of Syrian life.

The report by the Syrian Center for Policy Research put the total economic loss since the start of the crisis to the end of 2014 at $202.6 billion the equivalent of 383 percent of Syria's gross domestic product in 2010 prices. It said GDP contracted by 9.9 percent in 2014 compared with the previous year, while unemployment soared to 57.7 percent.

The social impact has been just as profound. The education and health systems have collapsed, and life expectancy has dropped from 75.9 years in 2010 to 55.7 years in 2014, according to the report. It said that almost two-thirds of the population lives in extreme poverty, unable to secure basic food and non-food items necessary for survival a trend that is particularly severe in conflict areas.

"The people of Syria are now forced to live under a terrible state of exception, estrangement and alienation with a massive social, political and economic chasm dividing them from those involved in violence and the institutions of violence," it said.

The report was produced with the support and coordination of the United Nations Development Program and the UN agency that supports Palestinians, known as UNRWA. It largely based its findings on data from Syrian government and UN agencies.