Saudi Arabia and Qatar have announced plans to pay Syria’s $15 million debt to the World Bank, a move that could unlock millions in aid and assist the new government in rebuilding an economy devastated by civil war.
The joint payment will allow the World Bank to resume its support and activities in Syria after a hiatus of over 14 years. This will enable the new Syrian government to access funds and technical support necessary for institutional rebuilding and accelerated development, according to a joint statement from Qatar and Saudi Arabia.
The Syrian government in Damascus expressed its “deep gratitude” for this initiative, stating that it “opens the door to activating cooperation with international institutions to serve the issues of recovery and reconstruction,” as noted by the Foreign Ministry.
Despite this development, the Syrian government faces significant challenges in rebuilding the country following nearly 14 years of conflict that resulted in the ousting of Bashar al-Assad in December. The war has severely impacted the economy, leading to widespread poverty, with over 90 percent of Syrians living in such conditions and one in four unemployed, according to United Nations reports. The value of the Syrian currency has drastically fallen, from 50 pounds to the U.S. dollar before the war to approximately 15,000 after the regime's change.
The situation remains dire, as the new leadership, comprised of rebel groups that replaced Mr. al-Assad, has implemented policies that have exacerbated economic hardships for Syrians. Long queues at banks are common as individuals attempt to withdraw funds, while hundreds of civil servants have been laid off and some public subsidies have been cut.
Initial expectations that Western sanctions imposed on Syria to penalize the Assad regime would be lifted swiftly have not materialized. Although some governments, including those of the European Union and Britain, have relaxed sanctions, the United States has issued a general license permitting certain exemptions from American restrictions for six months. However, the Trump administration has set conditions for lifting sanctions, including measures to prevent Iranian and proxy operations in Syria.
Concerns have also been raised regarding the jihadist background of the new president, Ahmed al-Shara, and his previous associations with Al-Qaeda.
The decision by Saudi Arabia and Qatar was made during discussions about Syria on the sidelines of World Bank and I.M.F. meetings in Washington this month. This event “provided a platform for the Syrian authorities to present their ongoing efforts to stabilize and rebuild their country, reduce poverty, and achieve long-term economic development,” according to a joint statement from the Saudi finance minister, the I.M.F. managing director, and the World Bank president prior to the funding announcement.
There was a collective acknowledgment of the urgent challenges facing the Syrian economy and a commitment to support the authorities' recovery and development efforts, the statement concluded.