As sanctions ease, Syria weighs what comes next

For the first time in over a decade, Syrian refugees are returning home in unprecedented numbers, Syrian banks are preparing to rejoin the global financial system, and international companies are quietly exploring opportunities in a country that was once economically radioactive.

The dramatic fall of Bashar al-Assad's regime has unlocked not just political change, but a complex web of economic possibilities — and risks — that could reshape the lives of millions of Syrians still reeling from war's devastation.

The United States' decision to lift key sanctions on Syria — announced by President Donald Trump during his visit to Saudi Arabia in May 2025 — raises urgent questions about what this means for the country's battered economy and the post-Assad regime's strategy. With 90% of Syria's population living in poverty, amid high unemployment rates, this moment represents both unprecedented opportunity and complex challenges for ordinary Syrians seeking economic relief after more than a decade of war.

The United States' decision to lift key sanctions on Syria — announced by President Donald Trump during his visit to Saudi Arabia in May 2025 — raises urgent questions about what this means for the country's battered economy and the post-Assad regime's strategy. With 90% of Syria's population living in poverty, amid high unemployment rates, this moment represents both unprecedented opportunity and complex challenges for ordinary Syrians seeking economic relief after more than a decade of war.

The Treasury Department's Syria General License 25 (GL25), issued in late May 2025, provides immediate sanctions relief in line with the President's announcement. Simultaneously, the State Department waived the Caesar Syria Civilian Protection Act for 180 days. Yet beneath the headlines lies a more nuanced reality: systemic barriers may delay meaningful impact for Syrian civilians for some time to come.

The Complex Reality of Sanctions Relief

"The recent sanctions relief doesn't rescind the sanctions," Tahlia Townsend, a partner in the International Trade Practice at Holland & Knight, explained to Raseef22. "Instead, it creates authorization for the transactions that would otherwise be prohibited."

The relief specifically allows transactions with 28 previously prohibited entities, including Syria's Central Bank, the Commercial Bank of Syria, and many state-owned petroleum, shipping, and aviation companies. For Syrian civilians, this could mean significant practical changes — if implemented effectively.

"The changes as a whole should allow Syrians to access markets outside of Syria for buying and selling goods and services," Townsend noted. "Syrians outside Syria should be able to send money home more easily. Syrians who want to work remotely for companies outside Syria should be able to do that.” The changes also make it easier for humanitarian organizations to accomplish their goals in Syria.

Mouaz Moustafa, Executive Director of the Syrian Emergency Task Force (SETF), emphasizes that much of the previous harm came from over-compliance rather than the sanctions themselves. American NGOs with ‘Syria’ in their name faced troubles with banks. “An intermediary bank would just see ‘Syria’ and would flag it, knowing that it’s a sanctioned country historically, and it would block that payment, even though that payment had nothing to do with Syria."

The Syrian American Medical Society (SAMS) had its bank account closed by Chase in early 2015 “with little explanation,” and stated that the word ‘Syria’ in the title of the organization immediately “made banks wary,” according to a Washington Post investigation. As a result, SAMS had to split operations among smaller banks to continue its work.

Banking Connectivity

Perhaps the most significant development for ordinary Syrians is Syria's anticipated reconnection to the SWIFT international payment system after being severed for over a decade.

"SWIFT enables safe and efficient communication of payment instructions between banks," Townsend said. "So that's how banks communicate with each other." For Syrians trying to receive money from relatives abroad, this represents a fundamental shift. "If you are a Syrian outside of Syria and you want to send money to a family member, and the family member has an account with the commercial bank of Syria, you'll be able to do that more easily with the sanctions relief."

The banking sector's rehabilitation is crucial for a country where credit cards still cannot be reliably used and the economy remains heavily reliant on cash.

“[It’s] really big, it's really important,” Moustafa described the SWIFT reconnection. “This allows Syria to reintegrate into the international financial systems and international economy — and banking is key to that. That's what's being prioritized right now."

Moustafa noted that Ambassador Tom Barrack has been "meeting with the U.S. Treasury on banking specifically. They're working to rebuild the banking sector and looking at some regional banks and others that can begin to do that."

Employment Prospects and Economic Opportunities

Syria's devastated economy presents both challenges and opportunities. Syria’s GDP plunged from tens of billions before the war to under $10 billion in recent years, representing one of the most dramatic economic collapses in modern history.

Moustafa sees significant potential for job creation. "Syria has probably the cheapest labor, if not one of the cheapest labor costs in the world.” The average monthly salary in the region is about $20 USD. "As companies see that Syria is no longer sanctioned or designated, I think that will open a lot of room for jobs. The same applies for reconstruction in the gas, oil, and electricity industry."

The employment implications extend to digital work platforms as well. "Previously, if the online staffing company was a U.S. company, or if it was going to deal with U.S. dollars, or if there was any other U.S. touchpoint in the transaction, they wouldn't have been allowed to assist a person living in Syria to get that work,” said Moustafa. “That restriction has now, at least while the license is in place, gone away."

Persistent Restrictions and Uncertainties

Despite the relief, significant barriers remain; the sanctions authorization itself is temporary.

“It could go away at any time if the U.S. government feels the situation isn't stable, or that it's deteriorating," Townsend warned. “Some portions of the relief also require Congressional approval to continue. So unless Congress takes some action in six months time, some pieces of the relief will go away."

“It could go away at any time if the U.S. government feels the situation isn't stable, or that it's deteriorating," Townsend warned. “Some portions of the relief also require Congressional approval to continue. So unless Congress takes some action in six months time, some pieces of the relief will go away."

Export controls present perhaps the most substantial ongoing restriction. "Everything is subject to U.S. export control except food and most kinds of medicine,” Townsend said. This includes telecommunications equipment, personal electronic devices, construction materials, agricultural materials, medical devices, and extends to foreign products containing more than 10% U.S. content.

Syria also remains designated as a State Sponsor of Terrorism, though Moustafa pointed out that the designation is expected to be lifted.

"America's intent and the president’s vision is that we have to give this young government a chance by not interfering, not demanding, by not giving conditions, by not imposing our culture on your culture," Ambassador Barrack said to journalists in Damascus in late May.

Refugee Return

The sanctions relief has already contributed to population movements. In the past several months, approximately 280,000 refugees have returned from neighboring countries such as Turkey, while around 800,000 internally displaced people have also resettled — totaling just over one million returnees inside Syria. The majority of these were already within Syria, and Moustafa cautions that a broad ‘mass return’ is not imminent. Managing returning refugees alongside internally displaced persons while rebuilding basic systems represents one of the new government's most complex challenges. “If we were to flick our fingers and have all of the 6 to 7 million refugees outside of Syria move back in... that would be difficult to manage right away without them having a place to live."

Complicating Syria's path to stability, Israel has conducted hundreds of attacks across Syria since the fall of the Assad regime. The strikes represent a strategic gamble by Israel to reshape regional dynamics in the post-Assad era, but they also inject fresh uncertainty into Syria's transition at a moment when economic recovery depends heavily on regional stability and international confidence.

For potential investors and humanitarian organizations weighing engagement with Syria, the ongoing military operations underscore how multiple regional powers are seeking to gain political leverage from the turmoil, creating additional layers of risk that could complicate the sanctions relief's intended benefits for Syrian civilians.

Governance and Corruption Concerns

A critical question for sanctions relief's effectiveness is whether economic benefits will reach ordinary Syrians or be captured by elites — a pattern that characterized the Assad era. Moustafa, who has visited Syria three times since the regime change, reports encouraging signs: "What we've seen in terms of actions is a lack of corruption, which is great. I hope that doesn't seep back in."

During the Assad years, economic opportunities were often monopolized by a small circle of regime loyalists. Whether the new government can establish transparent governance mechanisms will be crucial for ensuring that sanctions relief translates into broad-based economic benefits rather than enriching a new elite.

"Syria's elite was a mafia ruling all over the whole country,” Moustafa said. “No one benefited… you had a government that essentially ran the country like a farm for a family."

The Path Forward

Syria's sanctions relief represents a critical juncture, but the path to meaningful economic recovery remains long and uncertain. The combination of temporary authorizations, persistent export controls, infrastructural devastation, and institutional caution suggests that while the policy shift is significant, its practical impact for ordinary Syrians will emerge gradually.

The coming months will test whether Syria's new government can capitalize on this opening while building the transparent, accountable institutions necessary for sustainable economic recovery. For the majority of Syrians living in severe poverty, the stakes could not be higher.

As Townsend shared, "even if and when goods and services start to flow to and from the country, it'll take a lot of time for Syrian civilians who either have never had resources or who lost all their resources in the conflict to feel any positive effect from the trickle down. It's not going to be immediate."

The challenge of transitional justice and accountability in a post-Assad Syria also represents an unprecedented humanitarian crisis requiring decades of work. The scope is staggering. Syria has multiple mass grave sites, with one site alone potentially containing hundreds of thousands of victims.

While acknowledging the new Syrian government faces countless priorities, Moustafa expressed concern about the pace of accountability efforts: "That is something that I feel is moving slower than it should… it will take decades and decades to finish." He emphasized the need for sustained pressure to ensure transitional justice remains a priority amid Syria's many reconstruction challenges.

The coming months will test whether Syria's new government can capitalize on this opening while building the transparent, accountable institutions necessary for sustainable economic recovery. For the majority of Syrians living in severe poverty, the stakes could not be higher.