Visa, other cards not valid under Syria sanctions (AP)

DAMASCUS, Syria ? Visa and MasterCard credit cards are no longer valid in Syria under new U.S. sanctions targeting Damascus because of its deadly crackdown on a 5-month-old uprising, officials said Thursday.

The Treasury Department this month added the state-owned Commercial Bank of Syria and its Lebanon-based subsidiary to its sanctions list, citing their links to human rights abuses and to illegal weapons trade with North Korea. The action freezes any assets the firms have in U.S. jurisdictions and bans Americans from doing business with them.

In a statement faxed to the AP, the state-run Commercial Bank of Syria said the victims of the sanctions would be Syrian citizens and foreign tourists who will be "obliged to deal in cash with all its undesirable problems."

The credit card companies confirmed their cards are no longer valid in Syria.

"Visa is required by law to comply with the U.S. Department of the Treasury financial sanctions against Syria," the company said. "As a result, Visa has suspended its payment card activity in Syria under the recently expanded sanctions."

The ban on using the cards is part of a push to pressure the regime of Syrian President Bashar Assad, further isolating the nation in hopes that an economic squeeze will force the Damascus government to reconsider its policies.

But analysts say the sanctions ? and moves like banning the use of the credit cards ? may not have much immediate economic impact because the U.S. already severely limits trade and economic ties with Syria. the country's main trade partners were its Arab neighbors, and pressure from them is needed for the sanctions to have added power.

"This will be the key point for Syria ... if Arabs stop trading with" the country, said Said Hirsh, Mideast economist with the London-based Capital Economics. He said 60 percent of Syrian exports go to Arab countries. "It's the Arabs that will be able to cripple (Assad's regime) more than the international sanctions."

The move to ban the credit cards, which Syrian banks began issuing in 2005 for local customers, may also affect the country's influential merchant class ? a wealthy cadre of businessmen whose support, or at least lack of outright opposition, is seen as key to Assad's hold on power.

George Badi, a sales manager at the Dedeman Hotel in Damascus, said the measure will hurt business and wipe out many Internet-based reservations.

"It seems that the U.S. is slapping sanctions on the entire Syrian people not only the Syrian regime," he said.

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AP Business Writer Tarek El-Tablawy contributed to this report from Cairo.

Source: http://us.rd.yahoo.com/dailynews/rss/economy/*http%3A//news.yahoo.com/s/ap/20110825/ap_on_bi_ge/ml_syria_economy

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