For the European Union, the Mediterranean is a region of "political and strategic importance." To defend its interests, the EU launched the Barcelona Process, a multilateral strategy to promote human rights, democracy and economic prosperity. The process aims to develop a free trade area by 2010, and to advance "mutual understanding among the peoples of the region and the development of an active civil society." Believing in soft power, the EU views Association Agreements, which promote bilateral economic ties and trade, as tools to persuade countries to embrace a reform agenda. Such agreements are theoretically conditional on human rights standards. And anyone familiar with democratic theory knows that the development of civil society is a crucial precondition for a successful transition to democracy. But is the EU promoting civil society in Syria? And is this strategy working? The EU and Syria initialled an Association Agreement in October 2004. Since then the EU has stalled ratification because of Syria's behavior: Syria harbors organizations on the EU's terror list, such as Hamas. Damascus is seen to have been behind the assassination of the late Lebanese prime minister Rafik Hariri - and its lack of cooperation with the UN-backed investigation strengthens the suspicion. Recent political assassinations in Beirut - from Gebran Tueni to Pierre Gemayel - all bear Damascus's fingerprints. And Syrian support for Hizbullah - together with its deepening alliance with Iran - adds to the argument for tightening the screws on Damascus. Regardless, there is a view in Europe, voiced principally in the EU Parliament, that Damascus is today part of the solution in the Middle East, and that a fresh approach with Syria, one of engagement with the regime, is needed. Pressure is mounting on the European Council to unfreeze the Association Agreement and give Syria a political and economic opening to Europe. SYRIA NO DOUBT enjoys Europe's partnership. Since 1995, the EU has granted 259 million euros to Syria in aid under the MEDA program, and the European Investment Bank has given Syria 589 million euros. Since 2000, the EIB has signed loans for 925 million euros, which are now being disbursed. By providing 40% of Syria's trade, the EU has become that country's largest trading partner. The Association Agreement would only boost this flourishing business. Syria urgently needs this boost. Though enjoying good revenues from high oil prices, its energy reservoirs will soon dry up and its economy will be unable to sustain its growing population. The regime needs all the aid it can get. This would be a good moment to demand good behavior in return for a generous carrot. But this is not what unfreezing the Association Agreement actually means. Giving Syria carrots before tangible signs of change is not going to create incentives for the regime. If anything, it is a reward for bad behavior. A different approach would be for the EU to actually use its relations with Damascus to promote the core agenda of the Barcelona process - namely civil society, democracy and human rights. Yet, that is clearly not the case. Of the 17 projects currently listed on the Web site of the EU delegation to Damascus, only one is truly devoted to promoting civil society: The Village Business Incubator has a meager four-year budget of 552,112 euros overall to promote small businesses run by women in rural areas. The beneficiaries of the program are an Italian women's NGO (AIDOS), and a Syrian NGO, FIRDOS, under the patronage of Syria's first lady, Asma Al-Assad. So much for civil society. WHAT ABOUT the rest? The generous EIB loan package is mainly to improve the electricity power sector and other critical infrastructure. All other projects benefit Syrian government ministries or the UN agency in charge of Palestinian refugees, UNRWA. The ministry of higher education receives 33.5 million euros for three separate projects. The ministry of electricity received 11 million euros to improve the quality and quantity of the power sector output. The health and local administration ministries received loans of 30 million euros and 20.5 million euros for health and urban growth projects. This list is by no means exhaustive. There is always a dilemma in the democracy promotion business. Promoting democracy and civil society is not likely to viewed kindly by regimes that democracy would eventually unseat. This is understandable. Compromises, in the real world, are necessities and so one should not judge the EU too harshly for spending so much money to help the regime improve its delivery of services. Hopefully, the introduction of Western standards of accounting, management and infrastructure will have a set of beneficial side-effects that the regime will have to accept. Even if this does not happen, the undeniable economic benefits, once obtained, would be hard to take away, lest the regime lose support. IN ANY case, Europe is currently failing to promote its agenda of democratization in Syria. Though much money has been spent on civil society promotion, a senior EU diplomat based in Syria recently admitted, in a moment of candor at a hearing in the EU Parliament, that the EU had "next to no success with the civil society support projects" and that "some of the projects were launched, but later subverted by the regime." Has the EU learned anything from this experience? Not much, it seems. It will invest 150 million euros in civil society projects during the next four years, the same diplomat said during the same hearing. Through its soft power, Europe has real leverage with Syria, and it could be used to demand that the regime reform. Or the EU could naively continue spending its taxpayers' money to effectively help a dictatorship survive and thrive. Given that these are the options, the choice should be clear. The EU should stop throwing money at the regime and instead use the Association Agreement as leverage for Damascus to insist on some basic preconditions. Recognition of Lebanon's territorial integrity and independence, the appointment of an ambassador to Beirut and the demarcation of the Lebanon-Syria frontier would be an important first step; cooperation in the UN Inquiry on Hariri's assassination would also send a strong signal, as would the removal from Damascus of the Hamas politburo. A sincere and genuine effort to curtail Hizbullah's role in Lebanon and a more constructive approach on the Syria-Iraq border would also be desirable. Syria's economy desperately needs Europe. Its regime cannot survive without Europe's support. Perhaps promoting democracy is not something Europe does best, especially not at the rate of aid to the kind of government agencies it lists on its Damascus representation Web site. But pressuring Damascus to behave more responsibly with its neighbors and citizens is something the EU can demand. It only has to choose: between its extensive business ties with and charity to tyrants on the one hand, and principle on the other. For without principle, soft power is becomes so soft that it ceases to be powerful at all. Ottolenghi is director of the Brussels-based Transatlantic Institute and author of Autodaf : Europe, the Jews, and Anti-Semitism (in Italian). Rackowski is senior fellow for EU Affairs at the Transatlantic Institute.