Dubai-based Investment Group Overseas (IGO) said the merger of its partner Emaar Properties with fellow UAE firms will not derail a Syrian development worth about $1.1 billion.

Emaar, the Gulf region's second-largest developer by market value, pulled out of Algeria earlier in July citing slow progress in a $20 billion project after announcing in June it planned to tie-up with three property firms by the end of 2009.

Speaking to Reuters, IGO managing partner Anas Kozbari said Emaar-IGO was still aiming to complete the first phase of the Eighth Gate project, which will include the new Damascus Stock Exchange, by April 2010.

'There is no indication of such a process (Emaar pulling out),' Kozbari said. 'On the contrary, the merger with Dubai Holding should make them stronger.'    

The joint venture, in which Emaar is the majority shareholder, launched the project in Damascus in 2006 to provide much-needed commercial, retail and leisure space in the Syrian capital as the government takes steps toward economic liberalisation and boosts foreign investment.

With a lack of other investment vehicles in the country run by a socialist government for decades, people often invest in property, which along with a population growth guarantees demand for new housing units and commercial property.

'The project is on schedule ... the first phase is roughly $200 million,' Kozbari said, adding the entire development was valued at about $1.1 billion and would be completed by 2012/13.

Kozbari, who founded IGO with Syrian millionaire Moafaq Al-Gaddah in 2004, said the project had so far been financed directly by the shareholders. -Reuters