Iran has officially closed its Saipa car factory in Syria, a move attributed to economic challenges, as announced by Saeed Arif, the secretary general of the Iran-Syria Joint Chamber of Commerce. This facility, considered a “gift” from Tehran to Damascus, marks a significant withdrawal of Iranian economic presence in Syria.
The factory, built at an estimated cost of $50 million, originated in 2004 during former Iranian President Mohammad Khatami’s tenure and was inaugurated in 2007. Syrian President Bashar al-Assad, then-Prime Minister Mohammad Naji Atri, and former Iranian Housing Minister Mohammad Saeedi Kia attended the ceremony. Known locally as “Sevico,” the factory was jointly owned by Saipa (80%) and the Syrian government (20%) and once produced 15,000 vehicles annually with a daily capacity of 10 cars per hour.
Economic Struggle
The closure, seen as a sign of Iran’s broader economic struggles in Syria, was confirmed by Arif, who also noted that several other Iranian projects in Syria have yet to start or have ceased operations due to “issues related to the two countries.” Despite an estimated $25-30 billion investment supporting Assad’s government during the Syrian civil war, Iran has not realized substantial economic returns, particularly in reconstruction efforts.
Iran’s Saipa factory closure follows the troubled trajectory of other Iranian projects in Syria, such as the Iran Goodroe venture from 2009, which also struggled to take off. A 2007 Reuters photograph depicted the factory’s symbolic importance, showing an Iranian worker in the Homs facility alongside a prominent image of Assad and former Iranian President Ahmadinejad shaking hands, with the caption “Saipa … a gift to a friendly country.” This so-called “gift” has now been “returned,” underscoring the financial constraints Tehran faces in maintaining its presence in Syria.
In 2020, Heshmatollah Fallahatpisheh, a former member of Iran’s parliament National Security and Foreign Policy Committee, estimated Iran’s investment in Syria at $20-30 billion, adding that these funds were “the Iranian people’s money” and should be reclaimed. Iran, whose involvement in Syria began militarily in 2011 to support Assad’s regime, has also sought to influence Syria’s social and economic landscapes. The recent closure of the Saipa factory, however, highlights the growing limits of Tehran’s resources and the diminished economic dividends from its strategic engagement in Syria.
This article was edited by The Syrian Observer. The Syrian Observer has not verified the content of this story. Responsibility for the information and views set out in this article lies entirely with the author.
