With the collapse of decades-long authoritarian rule, Syria faces the monumental challenge of rebuilding its economy, which has been decimated by war, corruption, sanctions, and mismanagement. The new administration has taken initial steps toward economic reform, including privatization, currency stabilization, and fostering foreign investment. However, achieving sustainable recovery demands comprehensive planning, addressing systemic issues, and leveraging international cooperation.
Syrian Foreign Minister Asaad al-Shibani highlighted plans to privatize state-owned assets such as oil, cotton, and furniture factories, and to invite foreign investments in infrastructure, including ports, airports, and railways. This shift represents a departure from the socialist policies of the Assad regime and is intended to stimulate growth and attract much-needed capital.
Economists have debated the merits and risks of privatization. Ibrahim al-Adi and Mohammad Kousa underscore the potential benefits, such as reducing the financial burden on the state treasury, increasing efficiency, and generating jobs and revenue. However, critics caution against hasty or poorly regulated privatization. Iyad al-Jaafari warns that without governance, transparency, and accountability, privatization risks replicating the cronyism of the Assad regime, creating a new authoritarian oligarchy.
A gradual, well-regulated approach, as seen in Asian high-performing economies, could strike a balance between public and private ownership while ensuring stability and equitable growth. Despite these improvements, market activity remains sluggish. The delayed return of government institutions and public sector enterprises, combined with widespread insecurity, looting, and infrastructure damage, continues to hinder economic recovery.
Rising transportation costs due to energy shortages further exacerbate the situation, and many state and former military employees remain unpaid, straining household purchasing power. Addressing these inefficiencies will require legal and administrative reforms, transparent privatization processes, and efforts to attract domestic and foreign investors. Today, Syria remains economically oriented toward the West, with limited ties to Russia and Iran, despite their political and military support for the Assad regime.
