by the Human Rights and Business Unit of the Syrian Legal Development Programme (SLDP)

On 8 December 2024, Syrians woke up to a Syria free from the criminal Assad regime. After decades of tyranny that violated every Syrian’s right to live in freedom and dignity, the Assad family’s half-century rule has finally come to an end. An immediate reality is that the country is now open to economic recovery, and questions revolve around how that might be done in a context that has always been a complex and hostile environment for ethical business.
Historically, doing business across Syria – particularly in former regime-controlled areas – has been challenging for several reasons. These include Western sanctions, volatility, domestic obstacles, corrupt laws and practices, and the unwillingness of businesses to operate under criminal authorities. Syria had extractive economic institutions just as much as extractive political institutions. Today, the country may quickly become open to trade and investment, from small Syrian businesses returning, large corporations looking to invest, aid organisations and the UN working on reconstruction, and states like Türkiye and beyond taking advantage of new investment opportunities. The new interim prime minister, Mohammed al-Bashir, said he wanted to bring back millions of Syrian refugees and provide basic services, but would struggle to do so without foreign currency. The task of rebuilding Syria, however, looks set to be colossal following decades of economic theft.
Corrupt Legacy
Syria went through not only a devastating war, but also had a regime that sucked the life out of its economy. Those looking to invest and/or start reconstruction will be facing some unique challenges, as the regime’s control of the economy will not be easily untangled. The vast majority of the economy was monopolised by government members or their cronies, who had very little independence. The former regime’s control of state institutions allowed it to create the legislation and regulations needed to exert control over the economy and the private sector, which served in practice as tools to maintain crony control over key industries. The only economic beneficiaries of this system in Syria were those loyal to the regime, and there was also a complete lack of interest in preventing environmental harm through legislation or practice.
Monopolies in specific lucrative sectors and businesses that had enjoyed a low elasticity of demand, such as oil, telecommunications, and basic food items, create further difficulties for those entering these markets. In addition to a lack of competition, it has also led to severe shortages of essential goods. The regime further deployed the coercive arm of the state against businesses to force their compliance and cooperation, such as through asset freezes and confiscation, driving out many competent entrepreneurs.
In addition, inflation under the former regime was rampant, and the Syrian pound has lost most of its value. This severe devaluation of the national currency made it difficult for businesses to set realistic prices or forecast future costs. For foreign companies, the instability of the currency poses an additional risk, especially when conducting transactions and repatriating profits.
New Challenges
The most obvious issue for businesses looking to operate in Syria today is the ongoing security situation. Alongside the presence of insurgent groups, Israeli aggression, and armed militias, the uncertainty of what will come next is of paramount concern. Moreover, in the current configuration of this new Syria, businesses will have to work alongside Hayat Tahrir al-Sham (HTS), the group that liberated the country but are designated a terrorist organisation by the United Nations, as well as the United States and United Kingdom. Although this designation is under review, the implications of how to navigate engagement with this ruling power will be complex. More broadly, Syria is still subject to a host of international sanctions, primarily imposed by the US and EU, as well as several other countries. These sanctions target key sectors of the Syrian economy, including finance, oil, and telecommunications. When – and how – this will change is yet to be seen.
Fundamentally one of the biggest challenges is the systematic undermining of Syrians’ housing, land, and property (HLP) rights, mainly but not exclusively by the Assad regime, who since 2011 enacted a host of measures to seize properties and dispossess groups or communities it considered a threat to its authority. This will make it complicated for businesses to know where they can begin to invest without violating the rights of those who are struggling to reassert their HLP rights and recover their land or property.
Conclusion
The Human Rights and Business Unit of the Syrian Legal Development Programme (SLDP) has for many years promoted the need for legislation, awareness, and adaptation around human rights due diligence when doing business in Syria. Following HRDD criteria is essential, especially given that these entities will face a mix of old and new challenges in doing work in a way that neither causes or contributes to human rights abuses, nor is directly linked to them. Business can – and must – be conducted in the country, but working in an ethical manner is of the utmost importance.
Despite the risks, the opportunities for businesses that can – through a robust human rights-focused due diligence process – navigate the complex landscape, invest in the reconstruction process, and understand the local conditions, are substantial. With the right approach and a long-term view, Syria could become a promising market for businesses, especially with the potential of a reverse brain drain in the country. Potential investors and reconstructors must carefully weigh the risks and ensure they have the necessary risk mitigation strategies in place.