Shafaq News
After years of tight economic
restrictions, the repeal of the US Caesar Act has opened a new window for the
Syrian economy to regain stability and enter a broader phase of economic
transformation.
As Syrians anticipate the impact of
the decision on daily life, attention is turning to whether the new government
can seize the opportunity through substantial reforms and a reorganization of
regional and international economic ties.
Investment Channels Reopen
Osama Al-Qadi, a senior adviser at
the Syrian Ministry of Economy and Industry, told Shafaq News that lifting the
Caesar Act marks an important step toward restoring economic growth,
particularly because the law had severely restricted financial transfers. Its
removal, he said, “offers confidence and reassurance for Arab and foreign companies to invest in the country.”
According to Al-Qadi, American,
British, and Arab companies have already begun entering the Syrian market. With
the repeal of the act, banking transactions have become more accessible,
although he noted that the full impact on investment and economic recovery may
take from six months to two years.
He emphasized that the newly elected
Syrian parliament must revise several outdated regulations dating back to 1947,
“which hinder reconstruction and urban planning in any governorate,” and
stressed the importance of strengthening the banking infrastructure and
expanding electronic payment systems to support business activity.
Conditional Sanctions Relief
The Caesar Act—passed by the US
Congress on December 11, 2019—aimed to “punish the pillars of the Assad regime
for war crimes committed against civilians in Syria,” imposing broad sanctions
on individuals, companies, and institutions linked to Damascus. However, many
experts argue that the restrictions harmed Syrian society and its economy more
than the ruling elite.
Its name relates to a Syrian
military photographer who smuggled out thousands of images documenting torture
and war crimes committed by the Syrian government.
Earlier this week, the US Congress
approved by a majority the final version of the amendment repealing the act.
According to the draft document, “lifting sanctions remains subject to certain
conditions, including that US President Donald Trump submit an initial report
to congressional committees within 90 days, and subsequent reports every 180
days for four years.”
The document states that Syria must
demonstrate concrete steps to combat terrorist organizations, respect minority
rights, refrain from unilateral military action against neighboring states,
counter money laundering and terrorism financing, prosecute crimes against
humanity committed under the former regime, and curb drug production. If these
conditions are not met in two consecutive reports, sanctions could be
reimposed.
Gradual Economic Effects
Ibrahim Nafi’ Qushji, a lecturer at
the Private National University, told Shafaq News that scrapping the Caesar Act
is pivotal for restoring confidence in the Syrian economy. He said the move
will allow the banking system to reconnect with global markets, recover
financial transfer capabilities, and attract investment.
He also noted that this reopening
“will gradually reflect on the value of the Syrian pound as capital flows
increase and inflationary pressures ease, provided it is accompanied by
balanced monetary policies and serious banking reforms.”
According to Qushji, agriculture is
the sector most likely to benefit, as it remains a cornerstone of Syria’s
economy. He also expects a revival in light industries—such as textiles and
food production—thanks to easier access to raw materials and reopened export
markets.
“Construction and real estate are
set to expand due to reconstruction needs, along with logistics and trade
services, as import and export routes return to normal.”
Qushji noted that Syria has the
human and geographic capacity to launch a large-scale reconstruction effort,
but it requires significant external financing and legal reforms to strengthen
investor confidence and ensure a safe business environment. “The government’s
ability to modernize infrastructure and adopt transparent policies will be
decisive.”
He added that lifting sanctions will
help reopen ports and border crossings for normal trade, reduce import costs,
diversify goods, and allow Syrian products to reach regional and international
markets. “This openness could restore Syria’s traditional role as a commercial
corridor linking the Gulf, Turkiye, and Europe.
Despite the positive outlook, Qushji
noticed that “weak infrastructure, high levels of corruption, and bureaucracy
may slow the pace of recovery.” Partial European and American restrictions may
also limit full integration with global markets and maintain some legal risks
for investors.
Stressing that “the Syrian financial
system needs comprehensive modernization,” he added, “rebuilding trust with
global banks will require time, effort, strict compliance with international
standards, and stronger anti–money laundering regulations.”
Qushji expects the Syrian economy
could gradually shift from crisis-driven operations to a production-based model
if structural reforms succeed, with agriculture and light industry serving as
primary engines of growth.
He also noted the need for “clear
government plans for restructuring and attracting investment through updated
laws, incentives, and guarantees,” emphasizing that the private sector will be
the main driver of the post-sanctions era by investing in agriculture,
industry, services, and job creation.
Reform Needed for Daily Life
Improvements
On daily living conditions, Qushji
explained that improvements will not be immediate, but “will become noticeable
within two years” through increased employment, rising purchasing power,
gradual price declines, and strengthened public services supported by external
financing.
Read more: Beyond Sanctions: New chapter for Syria, new opportunities for Iraq
“Lifting sanctions strengthens
Syria’s return to its Arab environment and prepares the ground for joint
projects in energy, transport, and trade, in addition to increased Gulf
corporate interest in the Syrian market—provided a safe legal environment exists,”
he concluded.
Economic analyst Firas al-Hayyali
told Shafaq News that “lifting the Caesar Act does not necessarily mean an
immediate economic takeoff,” but it opens a transitional period that could
reshape the Syrian economy over the next three years.
He said Syria is currently operating
at roughly 40% of its pre-2011 productive capacity. Re-activating even half of
the idle capacity could raise GDP by 8–12% within five years, provided a stable
investment climate is established.
Written and edited by Shafaq News
staff.
