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Syria again seeks rice after failed tender

Syria is seeking 135,000 tonnes of white short grain rice, its General Foreign Trade Organization (GFTO) said on Monday, after failing to buy in a tender that closed on Aug. 25.

Syria’s civil war, now in its third year, has killed more than 100,000 people and driven millions from their homes.

The country has also struggled to buy food in recent weeks, issuing tenders to buy sugar, flour, rice and wheat citing extreme urgency yet failing to make any purchases.

It wants to pay using Syrian funds frozen abroad but any such deal would require the seller to secure permission from European governments to unfreeze the funds. Traders so far have appeared to shy away from doing so.

The GFTO said it was now seeking the 135,000 tonnes of rice with a deadline of Oct. 9.

It also said it had pushed back the deadline for a tender seeking 276,000 tonnes of white sugar to Oct. 8 from Sept. 24.

Syria failed to buy the same quantity of sugar in two previous tenders that drew little interest from international traders in supplying the desired quantity.

“The Syrians obviously do have an import requirement and are trying again to see if the frozen funds issue has been resolved or relaxed enough to enable them to make a purchase,” one European trader said.

“But the tender terms are still incredibly tough, with a one million-euro bid bond. I do not think major trading houses will be willing to offer under such terms in the uncertain framework of sanctions.”

A bid bond is a form of guarantee which tender participants must give to ensure they will deliver under the terms of their offer.

Frozen funds

Traders have said Syria should relax its tender terms in light of the risk involved in doing business with a country embroiled in civil war.

In Syria’s tenders in past weeks, traders said they were uncertain whether they would become liable to pay the bid bond if there were problems with arranging finance from funds in frozen bank accounts.

The United States and some of its allies are now contemplating military intervention, to punish President Bashar al-Assad’s government for what Washington says was a chemical weapons attack on Damascus suburbs that killed more than 1,400 civilians on Aug 21. Syria denies blame for that incident.

The European Union, United States and other Western countries have imposed sanctions on Assad’s government over his crackdown on the revolt in the country.

While sanctions do not target food, a financing freeze has hindered Syria’s ability to import food including grains and sugar.

— Maha El Dahan and Oliver Holmes report for Reuters from Abu Dhabi and Beirut respectively. Additional reporting for Reuters by Michael Hogan in Hamburg.

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