As Syria confronts the aftermath of decades of economic mismanagement and a turbulent political transition, prominent economists are raising urgent alarms about the nation’s precarious economic state and the significant challenges it faces moving forward.
Economist Ibrahim Qushchi offers a sobering assessment of Syria’s economic trajectory. From its early days of prosperity to successive eras of nationalization, a fragile mixed economy, and now acute stagnation, the Syrian economy is teetering on the brink of collapse. The December 2024 fall of the Assad regime has spurred expectations of a transition to a market-based economy. However, Qushchi cautions that this shift will be fraught with obstacles, particularly the entrenched dominance of industrial monopolies.
Key indicators underscore the gravity of the situation: an empty public treasury, a stagnant public sector, and a deeply recessed private sector. Compounding these issues, the deterioration of critical infrastructure and the Syrian Democratic Forces’ (SDF) control of vital energy resources have severely hindered industrial productivity. Economic sanctions further exacerbate the crisis, restricting the import of essential production inputs.
The Risks of Transitioning to a Market Economy
While a market economy is often associated with enhanced efficiency, investment influx, and sustainable growth, Qushchi warns that this transition poses significant risks to Syria’s industrial base. In his analysis, he highlights the vulnerabilities of a sector plagued by monopolization, limited competition, and heavy reliance on imports.
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Lower-cost, higher-quality foreign goods, he argues, could overwhelm the local market, driving non-competitive Syrian enterprises out of business. To mitigate these risks, Qushchi stresses the urgency of implementing comprehensive government policies that ensure both immediate stabilization and long-term economic resilience. He also calls on Syrian entrepreneurs to restructure and modernize their operations to survive and thrive in a more competitive environment.
Unemployment: A Growing Crisis
Economist George Khuzam shifts the focus to the human cost of Syria’s economic collapse, particularly the swelling ranks of unemployed workers, including laid-off public sector employees. Khuzam identifies a critical challenge: the skills gap that hinders these workers from reintegrating into the workforce.
He notes that most public sector employees have performed routine administrative tasks, offering little preparation for the dynamic and often uncertain nature of private enterprise. Their lack of entrepreneurial expertise, coupled with a deep-seated fear of failure, discourages them from taking risks in the free market.
Strategies for Economic Revival
Khuzam advocates for a comprehensive strategy to address unemployment and revive the economy, emphasizing three key pillars.
Firstly, tailored training programs are essential. Paid training initiatives can equip laid-off workers and graduates with market-relevant skills, enabling them to adapt to evolving economic demands and increase their employability.
Secondly, support for small and micro-enterprises is crucial. Promoting small and micro-projects through integrated support systems can stimulate local economies, create jobs, and reduce dependence on imports. This support encompasses a range of services, from ideation and financing to marketing and operational guidance.
Lastly, collaboration with donor organizations is vital. Partnering with international donors and development agencies can help assess and address the Syrian economy’s needs, mobilizing resources for grassroots economic initiatives and fostering sustainable growth.
A Critical Crossroads
The Syrian economy stands at a pivotal moment. Without decisive, coordinated efforts to tackle unemployment, revitalize industrial capacity, and foster a conducive environment for economic growth, the nation risks further destabilization.
Economists like Qushchi and Khuzam underscore the urgency of collective action to prioritize work, production, and sustainable development. Only through strategic intervention and collaboration can Syria begin to rebuild its economy, offering its people a pathway to stability and hope for the future.
This article was translated and edited by The Syrian Observer. The Syrian Observer has not verified the content of this story. Responsibility for the information and views set out in this article lies entirely with the author.
