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Most international sanctions originally aimed at the Assad regime have been lifted. (AFP)<\/p>\n
\n\tLONDON: Syria\u2019s battered economy is projected to grow by 1 percent this year after a 1.5 percent contraction in 2024, the World Bank said in its latest report.<\/p>\n
\n\tIt warned that the modest rebound remains \u201cextraordinarily uncertain,\u201d as the war-ravaged nation struggles with dwindling aid, tight cash flows and persistent insecurity.<\/p>\n
\n\tEconomic data from Syria remains \u201cextremely scarce and hard to come by,\u201d Jean-Christophe Carret, the bank\u2019s Middle East director, said in the July report.<\/p>\n
\n\tHe described the macroeconomic review as an effort to close key information gaps and lay the groundwork for future growth policies.<\/p>\n
\n\tEconomist Karam Shaar, who heads the Syria-focused consulting firm Karam Shaar Advisory, said that modest improvement was possible \u2014 but far from sufficient. \u201cSyria will see some economic improvement, despite the divisions that still exist,\u201d he told DW Arabia in September.<\/p>\n
Most international sanctions originally aimed at the Assad regime have been lifted. (AFP)<\/p>\n
\n\tHe added that government-held areas are likely to see gradual gains \u201ceven amid social divides and a lack of public trust.\u201d<\/p>\n
\n\tStill, the World Bank warned that security threats and difficulties securing oil imports could drive up fuel prices and inflation, further complicating recovery efforts.<\/p>\n
\n\tFourteen years of conflict and Western sanctions have devastated Syria\u2019s economy.<\/p>\n
\n\tGross domestic product has fallen by more than half since 2010, and per capita income dropped to about $830 in 2024 \u2014 below the international threshold for low-income countries, according to World Bank estimates.<\/p>\n
\n\tFollowing Bashar Assad\u2019s ouster, interim President Ahmad Al-Sharaa, former commander of the armed opposition group Hayat Tahrir Al-Sham, took control of most of the country after a rapid offensive that captured Damascus on Dec. 8.<\/p>\n
\n\tThe new administration has sought to attract investment and aid, but the World Bank said that a severe cash shortage, disrupted currency circulation and limited access to banknotes have intensified a liquidity crunch, squeezing already struggling households and businesses.<\/p>\n
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Reintegration of Syria\u2019s fractured geography could improve growth forecasts.\u00a0(Reuters)<\/p>\n
\n\tAccording to Benjamin Feve, a senior research analyst at Karam Shaar Advisory, security \u2014 not politics \u2014 will determine Syria\u2019s recovery.<\/p>\n
\n\t\u201cThere are credible pathways for a broad-based recovery, and I don\u2019t think that political change will be that important for economic recovery,\u201d he told Arab News.<\/p>\n
\n\t\u201cWhat is preventing broad-based economic recovery is the security aspect of Syria,\u201d he said. \u201cSo, before the security issues get really under control, we won\u2019t be seeing any sort of huge, large investments.\u201d<\/p>\n
\n\tViolence in the coastal region and in the southern province of Suweida this year has had \u201ca chilling effect on investment,\u201d he said.<\/p>\n
\n\t\u201cWe\u2019ve been working with private-sector companies, and after the clashes and massacres in Suweida, they withdrew their interest. Since then, we haven\u2019t seen any significant recovery or a return to pre-Suweida levels of interest in the Syrian economy.\u201d<\/p>\n
\n\tIn March, the Alawite community in Latakia and Tartus came under attack, following clashes between remnants of pro-Assad forces and transitional government troops.<\/p>\n
\n\tGunmen entered towns, interrogated residents about their religion, and executed those identified as Alawite, often through close-range shootings and torture, according to a Human Rights Watch report released Sept. 23.<\/p>\n
\n\tSectarian violence spread south the following month, as members of the Druze community in Suweida and the Sahnaya district near Damascus were targeted amid disputes over autonomy and political integration.<\/p>\n
\n\tTensions flared again in mid-July, when clashes between Bedouin and Druze militias escalated into widespread sectarian attacks that killed hundreds \u2014 many of them civilians, according to rights groups \u2014 before Israel struck Syrian government targets and US mediation helped broker a ceasefire.<\/p>\n
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More than 90 percent of the population lives below the poverty line.\u00a0(AFP)<\/p>\n
\n\tIn late September, US President Donald Trump extended the national emergency related to Syria, describing the situation as an \u201cextraordinary and unusual threat\u201d to US national security and foreign policy, citing risks including Daesh, war crimes, human rights violations and narcotics trafficking linked to the former regime.<\/p>\n
\n\tEven so, Shaar pointed to several positive signs: The easing of Western sanctions, policy harmonization between the northern and government-held regions, a modest recovery of key resources, and a trickle of returning foreign investment.<\/p>\n
\n\tIndeed, most international sanctions originally aimed at the Assad regime have been lifted. The US ended its Syria Sanctions Program on July 1, while the EU suspended and later lifted most sanctions by mid-2025.<\/p>\n
\n\tAlthough the Caesar Act remains in effect, it is currently suspended under temporary waivers.<\/p>\n
\n\tShaar cautioned against over-optimism. \u201cIn economics, this is called the \u2018base effect\u2019 \u2014 when the starting point is very low, as happened in Syria during the war, any sound policy, correct action or partial lifting of sanctions will naturally lead to improvement,\u201d he said.<\/p>\n
\n\tThe World Bank echoed that view, noting that while partial sanctions relief offers some upsides, frozen assets and restricted access to global banking channels continue to choke energy supplies, block assistance, and constrain trade and investment.<\/p>\n
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Fourteen years of conflict and Western sanctions have devastated Syria\u2019s economy.\u00a0(AFP)<\/p>\n
\n\tSamir Aita, chair of the Paris-based Circle of Arab Economists, told Arab News that the World Bank had downplayed the broad impact of sanctions, which have affected \u201call economic sectors, including agriculture.\u201d<\/p>\n
\n\tRegional engagement, particularly from Gulf states and Turkiye, could also support Syria\u2019s recovery, the World Bank said in its macroeconomic review.<\/p>\n
\n\tIn May, the World Bank confirmed that Qatar and Saudi Arabia repaid Syria\u2019s $15.5 million debt, enabling the bank\u2019s renewed involvement. Since then, the government has announced several major investment agreements aimed at rebuilding infrastructure.<\/p>\n
\n\tIn July, Saudi Arabia signed 47 memorandums of understanding worth $6.4 billion, mostly in infrastructure, real estate, telecommunications and tourism, Reuters reported.<\/p>\n
\n\tIn August, Syria signed a $4 billion deal with Qatar\u2019s UCC Holding to build a new Damascus airport, a $2 billion agreement with a UAE firm to develop a subway system, and a $2 billion project with Italy\u2019s UBAKO for the Damascus Towers real estate development.<\/p>\n
\n\tIn late September, state media reported $1.5 billion in new tourism contracts.<\/p>\n
\n\tMany of these MoUs, however, remain nonbinding. \u201cOverwhelmingly, the MoUs signed by the government are not translating into formal contracts,\u201d Jihad Yazigi, editor-in-chief of The Syria Report, told Arab News.<\/p>\n
\t\t\tINNUMBERS\n<\/p>\n
\n\t\t\t\t\u2022 50 percent Decline in Syria\u2019s GDP between 2010 and 2020.<\/p>\n
\n\t\t\t\t\u2022 $830 The country\u2019s GNI per capita in 2024.<\/p>\n
\n\t\t\t\t\u2022 90 Percentage of the population living below the poverty line.<\/p>\n
\n\t\t\t\t(Source: World Bank, UN)<\/p>\n
\n\t\u201cOf the many billions of dollars of contracts signed, only one \u2014 related to the management of the port of Tartus and signed with Dubai Ports \u2014 was translated into a formal contract,\u201d he said.<\/p>\n
\n\tHe argued that the government\u2019s presentation of MoUs as binding deals, especially with the interim president attending the signing ceremonies, \u201craised unrealistic expectations,\u201d similar to how it overstated the impact of sanction relief.<\/p>\n
\n\t\u201cBy doing so, (the government) raised expectations a lot \u2014 the same way it raised expectations when sanctions were lifted, or rather reduced, because they were not entirely lifted,\u201d Yazigi said.\u00a0<\/p>\n
\n\tThe Karam Shaar Advisory also noted in a September report that available information indicates that many partner companies are newly established and may lack the capacity to carry out large projects.<\/p>\n
\n\t\u201cThe business environment in Syria remains very challenging \u2014 security-wise, politically, in infrastructure, the absence of an efficient financial sector, and the lack of funding for major reconstruction projects \u2014 there is none of this,\u201d Yazigi said.<\/p>\n
\n\t\u201cWhen people are misled, it creates a legitimacy and credibility problem for future announcements.\u201d<\/p>\n
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Syria\u2019s transitional government, operating under a five-year interim constitution ratified in March, continues to struggle to build cohesive governance amid disputes.\u00a0(AFP)<\/p>\n
\n\tStill, he acknowledged growing interest from Syrian expatriates and foreign investors, even if tangible results remain limited \u201cbecause of the difficult business environment.\u201d<\/p>\n
\n\tThe World Bank\u2019s report notes that the interim government has begun unifying fiscal and monetary policies and strengthening public financial management.<\/p>\n
\n\tTo attract investors, Feve highlighted the need for \u201cclarity in legislation \u2014 particularly regarding the investment law, taxes and incentives for private investors.\u201d<\/p>\n
\n\t\u201cUntil a new parliament is in place, I don\u2019t expect much progress on that front,\u201d he said. \u201cHaving a functioning parliament will be crucial, and I hope it will be able to pass laws that bring stability and predictability to the economy.\u201d<\/p>\n
\n\tHe added: \u201cBusinesspeople in Syria are also waiting for this clarity,\u201d noting that \u201cwhile some amendments have been made to the 2021 investment law, they are still not enough.<\/p>\n
\n\t\u201cFrom what I know, Saudi investors, for example, expect much more in terms of regulation and legislation.\u201d<\/p>\n
\n\tSyria\u2019s transitional government, operating under a five-year interim constitution ratified in March, continues to struggle to build cohesive governance amid disputes with Kurdish-led groups in the northeast and Druze factions in the southwest.<\/p>\n
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The US ended its Syria Sanctions Program on July 1, while the EU suspended and later lifted most sanctions by mid-2025.\u00a0(AFP)<\/p>\n
\n\tFeve said that a unified parliament will be \u201cessential in designing a roadmap for reconstruction and recovery,\u201d adding that \u201cquick, well-crafted laws could boost investor confidence and transparency.\u201d<\/p>\n
\n\t\u201cThe key is to do it intelligently,\u201d he added. \u201cIt\u2019s encouraging that 200 new members of parliament will be tasked with drafting legislation and using their technical expertise to guide the process.<\/p>\n
\n\t\u201cRight now, we don\u2019t even know who\u2019s drafting presidential decrees, and some of them contradict one another \u2014 the system is opaque. Hopefully, a functioning parliament will increase transparency, boost investor confidence, and help drive economic recovery.\u201d<\/p>\n
\n\tFeve warned that \u201cwithout clear priorities, investors end up signing agreements for projects like subway systems or new airports \u2014 initiatives that don\u2019t match the country\u2019s most urgent needs.\u201d<\/p>\n
\n\tSyria held its first parliamentary elections since Assad\u2019s fall on Oct. 5, though 21 seats remain unfilled after polls were postponed for \u201csecurity reasons\u201d in two Kurdish-controlled provinces \u2014 Raqqa and Hasakah \u2014 and in Suweida, the interim authorities said.<\/p>\n
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Ordinary Syrians are sinking deeper into hardship, struggling each day to secure even the most basic necessities.\u00a0(Reuters)<\/p>\n
\n\tElection officials admitted \u201csignificant shortcomings,\u201d noting that only 13 percent of contested seats went to women and minorities.<\/p>\n
\n\tReintegration of Syria\u2019s fractured geography could improve growth forecasts.<\/p>\n
\n\tAita said that the World Bank\u2019s 1 percent growth projection underestimates actual conditions because \u201cit relies on data from the Assad-controlled areas only,\u201d which excluded the newly unified regions, namely the northwest.<\/p>\n
\n\tHe said that the GDP of both the northeast and the northwest \u201cwere comparatively significant.\u201d<\/p>\n
\n\t\u201cThis creates confusion on how to interpolate Syria\u2019s economic growth in 2025, from the data of the ex-regime area to the now united areas with the northwest,\u201d he said. \u201cThe next analysis should address the whole of Syria, with insights into the remaining divides.\u201d<\/p>\n
\n\tYet beneath projections of recovery, ordinary Syrians are sinking deeper into hardship, struggling each day to secure even the most basic necessities.<\/p>\n
\n\tMore than 90 percent of the population lives below the poverty line, according to UN figures. The World Bank says one in four Syrians lives in extreme poverty, and two-thirds fall below the lower-middle-income threshold.<\/p>\n
\n\tSyria ranked sixth globally in the Nov. 2024-May 2025 Hunger Hotspot Outlook by the UN\u2019s Food and Agriculture Organization and the World Food Programme.<\/p>\n
![\"\"](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2025\/10\/afp_20221124_153546_718_afp_or_licensors.jpeg\")
About 14.6 million people are food insecure, including 9.1 million acutely and 1.3 million severely food insecure, while another 5.4 million are at risk of hunger.\u00a0(AFP)<\/p>\n
\n\tAbout 14.6 million people are food insecure, including 9.1 million acutely and 1.3 million severely food insecure, while another 5.4 million are at risk of hunger.<\/p>\n
\n\tInflation, currency collapse and soaring prices for essentials such as food, rent and fuel have driven living costs to crisis levels.<\/p>\n
\n\tMany households now depend on remittances, multiple income sources and coping strategies such as selling assets or cutting health and education spending simply to survive.<\/p>\n
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<\/p>\n
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