Syria’s Economy One Year On: What Has Really Changed?

Before the fall of the Assad regime, the economic scene in Damascus, Aleppo and other cities reflected a system gasping for breath under years of war, sanctions and entrenched corruption. Today – one year after the end of a rule that lasted more than fifty years – the picture is more complex. The economy sits between the ruins of collapse and the hope of renewal, where cautious optimism mixes with the heavy burden of daily struggle. Syria now stands in a grey zone between the legacy of breakdown and the possibility of transformation, as investors hesitate and ordinary Syrians wait to see whether real change will touch their daily lives rather than remain tied to ambitious megaprojects.

One year is not enough to determine the future of an economy exhausted by conflict and political turmoil, yet the fall of the regime has opened the door to a new phase. The economy has a chance to reshape itself – if leadership, stability and vision emerge. For now, Syria remains in one of the most uncertain periods in its modern economic history, still searching for a “new identity”. While the new reality attempts to define an alternative economic model, the effects of political and administrative vacuum are visible across every sector. The question, then, is what has changed? How have markets moved? And what lies ahead – recovery or further decline?

Everyday Life After Assad Fall

In Damascus’s popular markets, goods are more diverse than at any time in recent memory – from Turkish and Chinese products to Gulf-made items – according to shopkeeper Abla Khaled, who spoke to +963. Yet purchasing power has not kept pace. Prices absorb most incomes, widening the gap between those with remittances or private businesses and those who rely on government salaries that barely last a few days.

In an industrial district of Aleppo, Said has reopened his metal workshop after a decade of closure. “I’m no longer afraid of an economic security patrol or some officer demanding his share,” he tells +963. “My worry now is the power cuts – and customers who cannot afford much.” His words reflect a shift from fear of the security apparatus to fear of economic survival, with more than two-thirds of Syrians still under the poverty line despite the end of the old repression.

In Daraa, university graduate Mahmoud Al-Masalma summarises the public mood: “The regime fell, but prices didn’t fall, and neither did unemployment or favouritism,” he tells +963. His comment reflects the feeling among many that political change has yet to translate into meaningful improvements in everyday life.

In contrast, economic activist Ghaydaa al-Ahmad from Latakia sees the present moment as “a founding stage”. She tells +963 that the opening of trade, the reduction of restrictions and the first attempts to dismantle older corruption networks – while still incomplete – give young entrepreneurs space to innovate, provided a stable financial environment and clear laws emerge.

Economy’s Direction

After a year, the Syrian economy can best be described as transitional – a mix of accumulated collapse and uneven attempts at revival. Economist Mahmoud Saad al-Din summarises the landscape in three points: a weakened economy lacking institutions and expertise; real but uncertain opportunities for reconstruction if a stable national government emerges; and an ongoing risk of economic fragmentation between zones of control.

According to Saad al-Din, the economy could follow several paths: slow recovery if the transitional government manages to stabilise security and unify financial institutions; prolonged stagnation if political fragmentation and slow international support continue; or rapid recovery – a less likely outcome – which would require major foreign investment and a large international reconstruction drive.

He adds that Syria today is essentially an “economy of aid and remittances”. The transitional government is no longer the main economic actor, while international organisations have become the backbone of daily life, especially in food, health and education. Meanwhile, remittances are the main source of liquidity for millions, and new local business networks have begun to emerge across different regions. These networks – made up of local businessmen, civil administrations and new economic actors – now play a key role in shaping local markets and may influence the future political economy of the country.

Saad al-Din concludes: “A year after the regime’s fall, Syria stands at a decisive moment. Either commercial openness, lighter sanctions and new investments become the basis for a productive economy that creates jobs and redistributes income – or the country slides back into a fragile rent-based model, controlled by new networks of interests, leaving citizens stuck between low wages and high prices.”

From a War-Driven Economy to an Uncertain Horizon

Researcher Hassan Murad describes today’s Syrian economy as a mix of three overlapping worlds: a decayed public sector, a struggling private sector trying to rebuild, and a large informal economy that grew during years of chaos and now competes with both the state and formal markets. International data shows that GDP remains far below pre-2011 levels, with deep wartime contraction followed by timid growth of about 1 per cent in the first year after the regime’s fall – too little for a country that has suffered devastation on this scale.

Trade has seen rapid liberalisation – but also dangerous imbalances. Imports surged after the reopening of border crossings, especially with Turkey and neighbouring countries, and maritime shipping routes slowly resumed. Markets flooded with imported goods, while exports remained weak. Murad warns that the import bill could reach tens of billions of dollars annually, while exports remain modest, mainly agricultural and light industrial goods. This widening trade gap places constant pressure on the currency and on foreign reserves.

Syrian Pound and Bread Prices: a Struggle to Restore Trust

Murad notes that the new authorities inherited a shattered currency and a public deeply distrustful of the Syrian pound. Dollarisation – partly informal, partly widespread – continued in many areas in the first months after the fall, with some regions relying on foreign currencies. Gradual measures to restore confidence have slowed the pound’s decline, but it remains fragile and reactive to any political or security tension. Inflation has slowed compared to the war years, yet prices remain high and unaffordable for many households, fuelling the sense that “improvement” is something seen in reports rather than in the price of bread or rent.

Agriculture has seen better harvests in former conflict zones due to improved access to land, though unstable marketing systems lead to volatile prices. Industry, however, shows the opposite trend: traditional factories in Aleppo and rural Damascus continue to struggle with destruction, capital flight and the loss of skilled labour. Oil – once the backbone of the economy – remains severely damaged, with 70 per cent of wells destroyed or out of service and production at roughly 15 per cent of pre-2011 levels. Control over oil fields has also become a political issue between competing authorities.

Murad argues that the real question now is whether Syrians and their partners can dismantle the legacy of corruption and monopoly and build a different economic and social compact – or whether the change will remain only at the level of names and faces rather than structures and systems.

Economy and the Challenge of Reconstruction

Academic Khaled Al-Akla tells +963 that no economic recovery can succeed without nationwide political and security stability, serious anti-corruption efforts and an environment that attracts the capital that fled the country. The first year after the transition shows that the economic cost of instability is the destruction of decades of development.

While the economy is shifting from “war economy” to a transitional phase, humanitarian and development aid keeps large parts of the population afloat. Millions rely on some form of assistance. The transitional government is trying to attract foreign investment, mainly from Gulf states and Turkey, through new legal incentives, but the current scale of investment remains far below the hundreds of billions needed for reconstruction. Questions around fairness and effectiveness also persist.

Foreign investors remain cautious due to insecurity, political uncertainty, the absence of a modern investment law and ongoing sanctions. International support is still mostly in the form of humanitarian aid or limited infrastructure projects rather than major reconstruction funds.

Al-Akla argues that what Syria needs most is a structural reform plan: a unified financial system, restored confidence in the currency, a transparent and competitive market, a fairer tax system, targeted subsidies and support for productive sectors capable of exporting. Strong, transparent institutions are essential for managing reconstruction funds and distributing the costs of reform fairly.

He concludes that the first year after the political change brought a glimmer of hope for an economy devastated by war, but the road to recovery remains long. Success will depend on national reconciliation, capable institutions and real investment. The Syrian economy today is like a patient who has left intensive care – still in need of long-term treatment and full rehabilitation.