The collapse of Bashar al-Assad’s government on December 8, 2024, will mark Syria’s future for years and decades to come.
After 14 years of war, Syria’s economy is in ruins. 90% of its population lives in poverty, the Syrian pound has lost 99% of its value, and GDP has contracted by over 80% since 2011.
Rebuilding this shattered economy is now one of the country’s most urgent tasks, but experts suggest it is impossible without international sanctions relief.
How bad is the damage?
Syria’s economy, once diverse and growing, is now unrecognizable. Before the war, agriculture contributed a quarter of GDP, and oil accounted for two-thirds of exports.
Today, oil production is less than a quarter of its pre-war levels, with infrastructure destroyed or looted.
Electricity grids function only for a few hours daily, leaving families and businesses in the dark.
Inflation on basic goods has soared, foreign currency reserves are nearly depleted, and the country now relies heavily on smuggling and an illegal amphetamine known as “captagon”.
Infrastructure vital for recovery—roads, housing, and power plants—has been systematically destroyed, creating long-term bottlenecks for development.
Adding to these challenges is Syria’s international isolation. Sanctions imposed primarily by the United States and European Union have severed Syria from global trade, banking systems, and financial aid.
Remittances that provide a lifeline for many families are now blocked, and organisations like the International Monetary Fund and World Bank are restricted from providing assistance.
The role of sanctions
Sanctions were designed to cripple Assad’s ability to fund war efforts and repress dissent.
They targeted banking, energy, and trade, cutting Syria off from the global economy.
While these measures successfully weakened the regime, they also devastated ordinary Syrians.
Economic opportunities dwindled, and small businesses collapsed under the weight of financial restrictions and a devalued currency.
As Ahmed al-Shara, the leader of Hayat Tahrir al-Sham (HTS) and Syria’s new ruler, takes power, sanctions remain a significant barrier.
HTS, labeled a terrorist organization by the US and UN, inherited these restrictions, further complicating efforts to rebuild.
International financial flows are blocked, and investors are wary of engaging with a government burdened by such labels.
Experts argue that lifting or easing sanctions is essential for kickstarting Syria’s recovery.
Without access to foreign investment, aid, or trade, the path to economic stability is almost impossible.
What’s at stake with oil and gas?
Energy is central to Syria’s economic revival. Before the war, the country produced 383,000 barrels of oil per day, generating half its government revenues. Today, production is less than 90,000 barrels daily, and Syria imports more oil than it exports.
The oil-rich northeast remains under the control of Kurdish-led forces backed by the United States.
These regions include Syria’s most valuable oil fields, but disputes over control and governance create roadblocks for reintegrating this resource into a unified national framework.
Experts like David Goldwyn, a former US energy official, emphasize the importance of securing and rebuilding oil infrastructure to stabilize revenue streams and attract foreign companies capable of restoring production.
Refugees will be key to recovery
Over 8 million Syrians fled the country during the conflict. Their return is essential for rebuilding both the economy and society.
However, many remain hesitant to return, citing poor security, lack of infrastructure, and an unstable rule of law.
Refugees with skills, education, and financial resources are particularly critical.
Their investments could rebuild housing, businesses, and public services.
However, attracting them requires more than promises—it requires functioning utilities, secure borders, and a reliable legal system.
Turkey, home to over 3 million Syrian refugees, could play a significant role in this process.
With economic and political interests at stake, President Recep Tayyip Erdogan has shown interest in reconstruction contracts and extending Turkish influence in Syria.
Stocks in Turkish construction and steel companies surged following Assad’s fall, indicating that there are opportunities for collaboration between Syrian leadership and regional partners.
Can international support turn the tide?
The international community holds the key to Syria’s economic recovery. Sanctions relief, even on a temporary basis, would allow financial flows to resume.
This includes permitting remittances, reconstruction aid, and private investments to rebuild critical sectors like energy and housing.
However, sanctions relief comes with conditions. Western powers have made clear that their support hinges on Syria’s new government committing to political reforms, inclusivity, and human rights. HTS must demonstrate it can govern transparently and equitably—a challenge given its Islamist roots and terrorist designation.
Clear benchmarks for reform are necessary to rebuild trust with international stakeholders.
For instance, the US and European Union could gradually lift sector-specific sanctions, beginning with energy and banking, while maintaining pressure for broader governance changes. This approach incentivizes progress while allowing immediate economic relief.
Can a fragmented economy be unified?
Syria’s economy is not only broken but fragmented. Over the years, different regions operated under different economic systems. Kurdish territories used the U.S. dollar, northern regions adopted the Turkish lira, and Assad-controlled areas relied on the increasingly worthless Syrian pound. Reconciling these disparities is critical for creating a cohesive national economy.
HTS must also balance competing business interests. New elites from Idlib may clash with traditional business networks in cities like Aleppo and Damascus. Without careful integration, these rivalries could undermine national economic policies and stall recovery efforts.
Rebuilding trust in Syria’s markets
For decades, Syria’s economy was plagued by cronyism and corruption.
Rebuilding requires fostering competition, encouraging entrepreneurship, and creating a transparent regulatory framework.
Small and medium-sized enterprises (SMEs), which once formed the backbone of the economy, need support to reopen and thrive.
Policies must focus on reducing barriers to new businesses, reversing protectionist trade measures, and attracting foreign direct investment.
Establishing a unified national currency, likely the Syrian pound, is also vital for market stability and economic planning.
A long road ahead
The choices Syria’s leaders and the international community make today will not just shape the country’s recovery—they will set the tone for how nations rebuild from the deepest depths of destruction.
Sanctions relief, if tied to measurable reforms, can act as a bridge between humanitarian urgency and long-term stability.
However, rebuilding trust—within Syria and beyond—requires action, not promises.
If this moment is wasted, the cost will not only be Syria’s continued suffering but also a missed chance to prove that meaningful change is possible even after years of devastation.
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