Key Developments: On October 19, the Central Bank of Syria announced the second phase of its campaign against unlicensed currency exchange and money transfer offices, which it runs jointly with the Interior Ministry.

On October 10, the bank issued 755 notices to shops and offices in ten governorates, giving them a chance to get licensed or stop. Five days later it announced that the grace period was over: from October 18, anyone exchanging or transferring money without a license would face penalties under Article 25 of Law No. 24 of 2006, whether or not they had been warned. Inspectors then detained people who kept working despite the warnings and seized the cash they were holding, and prepared their cases for court. By October 28, the bank and the Interior Ministry had filed 17 violation reports and sealed the premises involved.

Central Bank Governor Safwat Raslan wrote on Facebook the next day that the clampdown would be a core part of the bank’s work, not a temporary measure.

This move seems to have done little to stabilise the Pound, as the parallel rate kept rising through the campaign while the official one did not move. The Central Bank’s bulletin held the dollar at (new) SYP 122 throughout September and October, while the parallel, or black market, rate rose 3.7% over the month, from SYP 137.65 on October 1 to 142.75 on October 31, and peaked at 143.25 on October 26.

Mokhles al-Nazer, monetary policy expert and former first deputy governor of the Central Bank until September 2026, explained that the gap between the two rates widened from 13.4% to 17.6%, the widest in at least three months. He also estimated from six goods in Damascus that shop prices implied a dollar of SYP 182–187.

October’s fluctuations were not new, however, and continued a slide that resumed in early September after the dollar had fallen back from a mid-July peak. The parallel rate rose by 4.8% in September, from SYP 131.5 on September 1 to 137.75 on September 30 and, by the end of October, it stood 8.6% above its level two months earlier.

Partly because of the depreciating pound, the cost of living has risen much faster than incomes, and wages have fallen further behind prices over the past year. The WFP’s minimum expenditure basket rose 3% in September to SYP 42,575, 22% more than in the third quarter of 2025. At that level, the minimum wage of (new) SYP 12,560 a month covers about 30% of it. Against the Kassioun cost-of-living index, which put the minimum at over SYP 80,000 and the average at 130,000 at the end of September, it covers three to five days of a family’s expenses. The latest Joint Market Monitoring Initiative (JMMI) report, based on data collected in mid-August before the September fuel price rises, found that the food part of its survival basket for a household of six cost 22.8% more than in October 2025. That rise came largely from the pound’s fall over the period, from SYP 115 to 132 to the dollar on the informal market. Affordability fell below JMMI’s threshold in 96% of the sub-districts it could classify.

In Damascus, local estimates put food alone for a family of five at about SYP 50,000 a month, while many public employees earn (old) SYP 1.5–2 million, or (new) SYP 15,000–20,000. In Hasakah, food prices rose 15–20%. Traders blamed fuel and transport costs, the cash shortage and late payment of wheat dues. In Aleppo, a tailor said his USD 60–70 a week no longer covered his household’s food.

As a result of rising costs, the WFP estimates that 7.2 million people face acute food insecurity, including 700,000 in severe need. It projects that higher living costs after the September fuel price rises could push another 250,000 people into that category. Those rises were 40% for diesel, 26% for petrol and 9% for gas, and WFP says they set off protests and transport strikes in several governorates. Meanwhile, funding shortfalls have forced it to cut food assistance from 1.3 million people to 650,000.

Syrians have also grown more critical of how the government is handling prices and the currency, even though fewer of them say they are going without. Between September 28 and October 15, the Arab Center for Research and Policy Studies and the Arab Center for Contemporary Syria Studies asked 3,600 people how things were going. Just 31% thought the government had kept the lira under control, down from 46% a year earlier, and the same share thought it had kept prices in check, down from 42%. Only 41% described the economy as good, compared with 68% who said the same about security. Household budgets tell a slightly better story: 30% said their income did not cover their basic needs, down from 42% in 2025, while 55% said they could just about cover them with nothing to spare. Many families rely on outside help, as some 40% receive remittances from relatives abroad. Of the 29% who said they wanted to emigrate, more than half gave economic reasons, above all unemployment and rising prices.

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Why It Matters: At the policy level, the Central Bank’s campaign against unlicensed money changers targets a real problem, and the bank is right to want foreign currency moving through supervised channels. In fact, the IMF has urged Damascus to strengthen anti-money laundering rules, regulate the foreign exchange market, and reduce multiple exchange rates; through a crackdown, the bank seems to be answering the first two recommendations. Yet, the third one remains untouched.

In July, Governor Raslan argued that the exchange rate should not be the only measure of monetary policy (Read: Currency Replacement Ends as Syria Builds New Monetary Policy Tools). Three months on, however, the bank still seems to manage the lira with two tools outside any normal policy framework: rationing cash and closing exchange shops; neither is a durable solution. Keeping currency out of people’s hands slows demand, while closing informal money changers has yet to prove effective. In fact, Mokhles all-Nazer put the freeze down to reserves too weak to defend a new rate, and the deeper problem to the absence of a clear monetary policy framework, and seizures and sealed shops answer neither.

Looking at next year, the lack of stability in the exchange–or, rather, the continuous depreciation of the Pound–, while mattering today, will also matter for next year as it is about to collide with the 2027 budget. Finance Minister Barnieh said the budget would be completed in October, and it is due before parliament in the fourth quarter.

If the 2027 budget is built on the current official rate of 122, and the parallel rate reaches 150–160 by January, the budget’s lira allocations would have already lost 19–24% of their dollar value before the beginning of FY2027. Consequently, public salaries would buy much less, while USD-denominated imports, such as fuel and wheat, would cost more in lira than planned, thereby throwing off most budget calculations.

For reference, the 2026 budget was calculated using an exchange rate of SYP 110 per dollar, while the black market rate had reached SYP 120 per dollar at the beginning of the year.

Using today’s rate, the 2026 budget’s SYP 1.157 trillion in spending is worth about USD 8.1 billion, not the USD 10.5 billion announced.

Not all of the pressure is of Damascus’s making. Obviously, the US–Iranian war and disruptions in the Gulf and the Red Sea have raised freight and insurance costs, something particularly damaging for an economy that depends on imports. WFP attributes September’s fuel price rises partly to global supply and transport costs, and Minister of Energy Mohammad al-Bashir did the same during his hearing earlier in September.

Regardless of governmental responsibility, the combined effect of higher gas prices and the depreciation of the Pound is becoming untenable for households, and in The Syria Dispatch’s fieldwork (though mostly anecdotal evidence, and not a survey) in Syria in October and November, the cost of living was the grievance we heard most often.

Businesses are caught as well, with raw materials and imported goods priced almost in real time against the parallel dollar, meaning that every slide in the lira raises firms’ costs while their customers buy less. Traders in Hasakah reported sales at between a third and half of their earlier level, and said some shops had closed because their owners could no longer cover rent. Many sellers protect their working capital by pricing at tomorrow’s replacement cost, as highlighted by Mokhles Nazer, which passes the currency risk straight on to consumers.

For the government, regardless of whether it is at fault for the current affordability crisis, if the situation for shoppers and shopkeepers alike continues to deteriorate, they will start increasingly wondering whether the transition is actually delivering, turning a monetary problem into a political one. Since the transitional government came to power without elections, after nearly two decades of economic decline, it has few sources of legitimacy as strong as making people’s lives better, and on that score Syrians are not yet giving it much credit.

As the Arab Opinion Index shows, respondents rated the security situation positively at 68% and the political situation at 63%, but only 41% said the same of the economy, and just 31% credited the government with controlling prices or the lira. To many of those The Syria Dispatch spoke to in Damascus, whether experts or regular citizens, Syria’s recovery is starting to look K-shaped: a minority does well while most fall behind, and that sense of unfairness wears down trust faster than any single price rise.

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Key Developments: As of October 29, the government had still not set a date for the large-scale distribution of subsidised heating diesel announced six weeks earlier or criteria for choosing which households qualify, which the Minister of Energy said was being discussed with the Ministry of Social Affairs and Labour.

In mid-October, the secretary of the Consumer Protection Association, Abdul Razzaq Habza, said the cheaper diesel grades still had not reached their intended users, while by the end of the month, SYP 150 diesel was available only through a request-and-approval procedure run by the Energy Services Directorate.

Mohammad Salem Wahab, a member of the Rural Damascus Chamber of Commerce, described the quantities supplied this way as very limited and said buyers had complained about its quality. He added that stations had received no instructions on the subsidised tier, and that diesel in Damascus and its countryside was selling at SYP 175. Rural Damascus was instructed to form committees to identify the neediest households, a model to be extended to other governorates, with Suwayda and Rural Damascus beginning to list their poorest families in late October.

The delay coincided with the start of the heating season, and with the rising cost of living and falling purchasing power, households were reported to be falling back on firewood, cardboard and plastics. Indeed, with 150 litres of diesel a month at the subsidised price needed for a family home, the total bill would cost SYP 17,250, against a public-sector minimum wage of SYP 12,560.

In Hasakah, where the integration process remains underway, the Autonomous Administration previously distributed 300 litres of heating diesel per family each summer at (new) SYP 11 per litre. That allocation stopped this year as services moved to government structures, and some families resorted to burning dung, cotton residues and old clothes instead. Industrialists’ struggles match households’, as they buy black-market diesel at double the official price, according to Louay al-Ashqar of the Damascus Chamber of Commerce. Aleppo’s energy official, Youssef al-Shibli, said the governorate needs about one million litres of diesel and 1.25 million litres of gasoline a day. He put that at roughly double its earlier consumption, as factories reopen following the collapse of the Assad regime.

Hefty black market prices are driven by petroleum shortages, as local media found in mid-October stations in Hama, Aleppo and Idlib almost out of diesel, which Energy Ministry media director Abdul Hamid Sallat blamed on attacks targeting product pipelines from Banias and Homs. On October 15, the Banias–Homs line had been punctured at Hadideh in rural Homs to steal fuel, and the leak closed the Homs–Tartous highway until October 17. Gasoline supply was further disrupted after an ‘off-specification’ shipment reached the market (see “Damascus Reshuffles Its Economic Team as the Gasoline Scandal Claims the Oil Chief”).

On October 11, the Syrian Petroleum Company (SPC) said 15 tankers, six carrying diesel and nine gasoline, were waiting to discharge. Observers counted 15 tankers arriving at Banias between October 8 and 18, most of them from European ports, eight of which unloaded more than 1.3 million barrels.

Also on October 11, the Central Bank announced that it had executed its first documentary credit in 14 years, through a major US bank, to finance an SPC purchase from Saudi Aramco. The first cargo, carried by the tanker Starling, reached Banias on October 19 with 63,784 tons of diesel. SPC’s finance director, Mohammad Qouja, later revealed that JPMorgan had confirmed and guaranteed the credit and that SPC had received 65,000 tons under the deal. He said SPC hoped to extend future cargoes to gasoline and, later, light crude. On October 29, after a call between Deputy Energy Minister for Petroleum Ghiath Diab and Saudi energy adviser Fouad Mousa, the Energy Ministry said it was arranging a second Aramco cargo for early November.

Beyond oil, disruptions also affected gas supplies as, on September 30, an explosion on the gas line feeding the Tishreen power station knocked out Tishreen, Deir Ali and Nasiriyah, cutting about 60 MW from Daraa’s allocation. Deir Ali and Nasiriyah returned to service the next day, but Tishreen stayed out of service due to equipment damage, and the cause of the blast had not been established. On October 28, the Syrian Electricity Company attributed longer rationing hours to maintenance, the Tishreen units still out of service and lower deliveries of Azerbaijani gas.

In fact, attacks on the energy infrastructure picked up quite significantly between the end of September and October. On September 20, Energy Minister al-Bashir told parliament that oil pipelines had been attacked 22 times in 2026. On September 28, sabotage caused a section valve to explode on the Jbeisseh gas line at al-Shoula in rural Deir Ezzor. The line carries about 950,000 cubic meters of gas a day and was back in service on October 2, after an 18-meter section was replaced. On October 7, an oil line near Tal Hamis in Hasakah was damaged in what SPC called sabotage, and the company said it had arrested those responsible. On October 15, the Jbeisseh export line was hit again, at al-Arbidi about 60 km from Shaddadi, and caught fire. The same day, the Banias–Homs products line was punctured at Hadideh.

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Why It Matters: The three-tier system seems to have exposed the government’s habit of announcing policy before working out how to implement it. Energy Minister al-Bashir announced the system on September 17, four days after the price rise that set off the protests, and seemingly before anyone had worked out how it would run. SPC’s chief executive said that the company was only then starting to draft an implementation plan, and no date was set. Delivery was split between SPC, the governorates and unnamed “relevant bodies,” while the Ministry of Social Affairs and Labour was left to write the eligibility criteria and had not finished them by the end of October.

While targeting a subsidy is not wrong in itself given the current context, six weeks without delivering points to little political will to fund one. The tools now being floated, local committees and a revived smart card, are ones economists warn could reproduce the old system’s abuse, and that Syrians already tried without success. This is liberalising from the wrong end: the price went up first, and the safety net is being improvised afterwards, as winter starts. The situation in the northeast is poised to be much more consequential, given that integration with Damascus replaced the Autonomous Administration’s heating ration with national prices before any national support was in place, forcing populations to absorb a much steeper price increase.

Given the procurement challenges, then, the documentary credit deserves real appreciation because it lets SPC buy from a major supplier through ordinary trade finance, with a US bank confirming payment, at a time when diesel is scarce worldwide. Still, the mid-October shortages came while tankers queued offshore, shifting the bottleneck from procurement to the port-to-pump stage.

In the Arab Opinion Index survey conducted between September 28 and October 15, 40% rated electricity supply as good, up from 26% a year earlier, while the share rating fuel availability as good fell to 36% from 48%.

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Key Developments: A meeting at the Damascus Chamber of Commerce on October 7 turned into a list of grievances against the Syrian-Chinese Business Council (SCBC), as traders raised concerns about business visas to China, high membership fees, the council’s focus on large investors over small and medium firms, and the absence of any banking channel between the two countries. Council chairman Fadi Ahmad al-Muhaimid denied that the council had obtained a single business visa since its creation, whether through letters of recommendation or any other route, and said the file was frozen at the consular level, adding that the platinum, gold, and bronze membership tiers reflected services and access to delegations rather than visas. Damascus Chamber member Ayman Daqqaq argued that tying visa facilitation to costly membership categories shut out the small and medium traders who make up most of the business community, and demanded that the council publish its fees, who collects them, and how they are spent.

SCBC Executive Director Laith al-Rikabi said the Chinese consulate had agreed to issue only a very limited number of visas, and that the council had decided to separate its visa service from membership and offer it to all traders through the chambers of commerce. Damascus Chamber chairman Issam Ghreiwati said he had visited the Chinese embassy months earlier with Federation of Syrian Chambers of Commerce head Alaa al-Ali, described the file as having “political dimensions,” and said Beijing had promised to ease visas for specific categories of traders within six months. Chamber board member Hamza al-Jabban proposed that Chinese firms hold specialised exhibitions inside Syria every 20 days, which he said would let 70–80% of Syrian traders deal with Chinese counterparts without travelling.

Government contacts with Chinese companies continued through October, nearly all at the exploratory stage. Ali met Chinese investors on September 30 to discuss joint projects, and on October 1, Chinese Ambassador Shi Hongwei wrote in Al-Thawra that China was ready to do what it could to support Syria’s economic and social development. On October 11, Deputy Minister of Economy and Industry Basel Abdul Hannan met a delegation from Hebei-based Qinhuangdao Shihaidayi Glass at the Aleppo Industry Directorate to discuss a direct investment or strategic partnership, and the company said it first wanted to assess the potential. Deputy Agriculture Minister for Plant Production Mustafa Zakiyeh discussed reclaiming Badia and degraded land and treating soil salinity with Chinese firm San Yuan Gong Sheng, and the two sides agreed to hold technical meetings and form joint teams to select sites for field trials.

The exception came in Raqqa, where on October 13, Governor Abdul Rahman Salameh attended the launch of a cement plant in Ain Issa, and SANA reported the laying of a foundation stone. Al-Hassan Holding Group board member Ibrahim al-Issa said the plant would produce 7,000 tons of cement and 5,000 tons of clinker a day, the capacity of the project the group agreed in April with China’s Jiangsu Pengfei Group, with 300–350 Chinese and Turkish experts working on construction. Mahmoud al-Najras, a member of the governorate’s executive office, put the cost at over USD 200 million.

Data from China’s General Administration of Customs (GACC) extracted by The Syria Dispatch show Chinese exports to Syria of USD 1.27 billion in January–September 2026, more than triple the USD 367.7 million of the same period in 2025, against Syrian exports to China of USD 1.4 million. September alone accounted for USD 292.0 million, the highest monthly figure since at least January 2016 and almost double the previous peak of USD 152.1 million in August 2018.

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Why It Matters: The government’s courtship of Chinese capital has so far produced more paper than projects, which is not in itself a failure, since most agreements signed since May 2025 are frameworks rather than investment commitments. The Federation of Chambers’ July memorandum with the SCBC covers forums, information exchange, and training. In June, the Higher Education Ministry described its memorandum with Nanjing EOTO as a framework for cooperation, with projects still needing legal and technical approval. The smart industrial cities centre launched in Changshu in June promised furniture cities in Aleppo and Damascus as its first phase, yet the Aleppo site was still on a Chinese delegation’s itinerary of potential investment sites in November.

The deals that look like actual investments have delivered little so far. The 20-year concession over the Hassia and Adra free zones was signed in May 2025 with Fidi Contracting, which the ports authority itself described as an agent for another Chinese firm, and the scarcity of public information about the company prompted questions about who was behind the deal. The Syrian Company for Automotive Industry (SCAI), owned by the Syrian Sovereign Fund, signed a strategic partnership with Yutong in July without disclosing a site, capacity, value, or timeline. The USD 500 million Hassia package with Zhong was presented as a plan to allocate land. The one project to have broken ground is the Ain Issa cement plant, agreed in April 2026 between Al-Hassan Holding Group and Jiangsu Pengfei Group, a firm that describes itself as a cement equipment manufacturer; Chinese experts will work on its construction alongside Turkish ones. As far as has been reported, its Chinese contribution is equipment and expertise rather than capital.

Yet, while large projects have yet to materialise, given that capital-intensive projects take time for technical licensing, equipment transport, regulatory clearances, and legal structuring, as well as viable financial channels, the Syrian-Chinese economic relationship, judged by its momentum, seems to be headed in the right direction.

But while slow construction can be explained, the fact that the Yutong deal still has no disclosed site or the Fidi concession has no reported activity 18 months on remains unclear. The Syrian-Chinese Economic Development Forum on November 3–4 may offer a first answer: a delegation of 16 Chinese companies attended, was received by President Ahmad al-Sharaa, and toured potential project sites.

Trade, which looks more promising than the bilateral agreements, has more than tripled independently from the council, and the composition of Chinese exports shows who is driving it. Lithium-ion batteries, inverters, passenger cars, tyres, and fabrics are what households and small businesses buy to compensate for an unreliable grid and years of suppressed imports. These are the goods moved by the importers who told the council in October that they cannot get visas, cannot pay suppliers through a bank, and cannot afford its membership tiers.

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Key Developments: On October 19, President Ahmad al-Sharaa issued Presidential Decree No. 189 of 2026 appointing Basel Abdul Azi…

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Key Developments: On October 21, the Ministry of Agriculture estimated the 2026 olive crop at 954,730 tons, from about 677,725 hectares. Of that, 763,784 tons are destined for pressing, which, at an assumed 25% yield, would give about 190,946 tons of oil.

Aleppo leads with about 226,300 tons of olives, followed by Idlib (156,800), Tartous (127,800), Latakia (121,100) and Hama (100,800). The head of the ministry’s Olive Office, Mohammad Qawwas, said any surplus could be marketed and exported once domestic consumption had been determined. He added that competing abroad would depend on quality rather than volume, meaning improving the whole chain from picking and transport to pressing, storage, laboratory testing, and branding.

The ministry had issued a circular on October 4 setting harvest and press-opening dates by region, with picking in Idlib, Khan Sheikhoun, Saraqeb, Maarat al-Numan and Harem due to start in early November. Idlib governorate capped pressing fees on October 19 at SYP 10 per kg of olives when the pomace (leftover pulp) goes back to the farmer, or SYP 2 when the press keeps it, or 5% and 3% of the oil if paid in kind.

In Afrin, where picking began on October 1, green olives sold for (new) SYP 70 a kg, down from SYP 150 last season, and a 16-kg tin of oil sold for USD 63, down from about USD 90. Traders advised growers to store their oil and wait for prices to recover within about four months, but growers said they needed cash to repay debts for ploughing, fertiliser, pruning and picking.

Nationally, olive specialist Ahmad Amiri put a tin of high-quality oil at about USD 70 in mid-October and expected it to fall further as new oil reached the market. He said new export companies had set up in every producing governorate this season, and that exports had peaked at about 50,000 tons before 2011. Export markets are crowded, however: a Syrian exporter said Gulf buyers were turning to cheaper Tunisian oil.

Under the former government, exports were tightly rationed, and after a ban imposed in September 2023, the Economy Ministry allowed licensed filtering and bottling firms to export 10,000 tons in October 2024. The new government has not yet announced its export rules for this season.

On production costs, a grower said he sprayed against aphids (a type of plant lice) four times and still lost part of the crop at flowering. An agricultural engineer attributed lower oil yields in some areas to summer heat and humidity, and Amiri said September’s diesel price rise had pushed up production costs. As for picking, most of it remains manual, with one worker gathering about 60 kg a day and earning an average of (new) SYP 1,000 (around USD 7) a day; women are paid differently from men, and most seasonal workers have no insurance or compensation if injured.

In Afrin, the harvest is also a test of the January 29 agreement between the Syrian Democratic Forces and the government in Damascus, under which about 10,000 displaced families have returned from Qamishli, Hasakah and Derik, with returnees already describing unemployment, falling construction wages and expensive fuel, having counted on the olive season to see them through.

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Why It Matters: Despite the Ministry of Agriculture touting a windfall for the olive and olive oil sectors in 2026, the data show Syria is closer to recovery than a bonanza. At 954,730 tons, the crop is 2.3 times last year’s harvest, but it is below 2022’s and close to the 2003–2012 average of about 870,000 tons.

Furthermore, the olive oil estimate also leans on generous assumptions, since 190,946 tons of oil would amount to 20% of the whole crop, at the top of the historical range in CBS data and well above the 13% implied in the 2024 estimate, and in a year when engineers report lower extraction in some areas. At 2024’s yield, the same crop would give about 122,000 tons.

Another point to keep in mind when looking at this year’s harvest is that olive trees bear heavily in alternate years, so a large crop now likely means a smaller one next year, and export plans must account for this; export plans are built on this season’s surplus.

While most prices in Syria are rising, olive oil is getting cheaper, though this season the reasons are mostly domestic. World prices fell a year earlier, after Spain, the largest producer, recovered from two drought-hit harvests. Spanish output had dropped to 665,800 tons in 2022/23 and 852,600 tons in 2023/24, pushing extra virgin oil to a record €8.99 per kg in January 2024. When the 2024/25 crop recovered to 1.38 million tons, the price fell to about €3.93 by February 2025, and the IMF’s benchmark world price dropped 38% between 2024 and 2025. Syrian exporters felt it, with the average value of Syrian oil exports falling 19% over the same period (see charts below).

Since then, however, world prices have been broadly stable, rising about 5% between October 2025 and September 2026. The 30% fall in Afrin’s tin price this season therefore has more to do with conditions at home: a crop that has more than doubled after last year’s drought, growers who need cash to repay debts, and no export outlet yet to absorb the surplus. Growers are selling into that glut after a 40% rise in diesel prices, and on rough figures, picking alone takes about a quarter of the farm-gate price of green olives in Afrin.

At the policy level, it is worth noting that, despite the state government’s intentions to liberalise the economy and therefore withdraw from the market, the fee caps show that the state is, in fact, not stepping back. Yet, in this case, the interventions are among the government’s more defensible.

Indeed, given that olives must be pressed within a day or two of picking, queues at presses can stretch to days at the peak of the season, and the press owner controls the means of producing the oil; farmers cannot easily shop around. Thus, while capping fees in that position can be seen as Baathist price-setting, it is better understood as regulating a local, time-bound bottleneck.

The cap also prices pomace, which can also be used as fuel, administratively, with the gap between the two cash rates valuing pomace at SYP 8 per kilo of olives, at a time when costlier diesel is making pomace more valuable as fuel.

Olives and olive oil are another case study of a wider pattern in post-Assad economic policymaking. In January 2025, caretaker Trade Minister Maher al-Hassan (now chief executive of the Syrian Petroleum Company) promised an open, competitive market. Since then, the state has withdrawn wherever support costs money, as with its subsidy schemes, while continuing to intervene wherever intervention costs the treasury nothing. That runs from harvest dates to press fees, which are now set governorate by governorate in nominal pounds that lose value every week. The same inspectors who policed and enforced by the same kind of consumer-protection patrols whose caps, farmers complained, few presses respected in 2024

One question the government has yet to settle is whether it will allow olive oil producers to export. Under Assad, exports from government-held areas were tightly controlled: the government halted olive oil exports in September 2023 to hold down prices at home, and later allowed only 10,000 tons to be exported. Far more Syrian oil left the country through the north, from areas then outside government control. In 2024, Türkiye reported importing about 51,500 tons of olive oil from Syria, most likely from Afrin and Idlib, while all other countries together reported about 13,300 tons.

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Key Developments: On October 21, the Agricultural Cooperative Bank (ACB) issued a circular, based on a Central Bank letter dated October 20, cancelling the payment mechanism set by the Central Bank Governor’s letter No. 17/944 of June 28, which the ACB had circulated on July 12. Under that mechanism, farmers owed more than SYP 1 million received their dues in three or four monthly instalments, depending on the amount, with a quarter paid through Sham Cash from August.

The circular came as Hasakah officials’ end-of-October deadline approached. An ACB official had put the share of Hasakah invoices paid during September at no more than 2%, and a large number of the governorate’s farmers were still waiting for their dues in late October. Payments were further along in the rest of the country. On October 5, an unnamed agricultural official revealed that about half of all grain dues had been paid nationwide. On October 14, the director of the ACB in Deir Ezzor, Mohammad al-Akl, said that 70–75% of the governorate’s dues had been paid. He added that the Central Bank’s supply of cash was “good” and that the rest would be paid by the end of the month, although farmers there were still asking to be paid in one go.

On October 20, a source at the ACB’s Hasakah branch said that, at the current rate of cash inflows, payment would take another four to five months. Branch director Azzo Hamed al-Ali denied setting any such timeframe that day and said the ACB’s head office was working with the Central Bank to secure liquidity. In Derik, the branch manager said on October 19 that larger transfers had arrived. He was still paying farmers who had delivered between June 29 and July 1, and hoped to finish within two months. In Raqqa, some farmers had received only a first instalment of about 25% of their crop’s value by early October.

Given the long delays in processing payments and the rapidly depreciating Syrian pound, any additional day of delay reduces the value of farmers’ dues, something critical given that dues are paid in pounds, while seed, fertiliser, labour, and most debts are priced in dollars. For example, Raqqa farmers said they had bought dollars at 138 to repay creditors (see “[TBA-link: October currency entry]”), with one expert saying some farmers had sold wheat to traders below the official price to be paid at once.

Beyond last year’s dues, the next harvest is also at risk, given the cost of inputs farmers have to buy, mostly in dollars, while their wheat money is still held up and the planting season has already begun.

In Hasakah, soft-wheat seed sold at about USD 375 a ton and durum at USD 400, plus USD 25–50 a ton for cleaning and treatment. Ploughing cost USD 3–4 or (new) SYP 200–400 a dunum, with tractor owners paying (new) SYP 175 a litre for diesel. One farmer cut his seed rate to 15 kg a dunum to stretch what he had. Farmers said the ACB had not supplied the nitrogen and potash fertiliser they usually received through it, leaving them to markets where nitrogen sold at about USD 65 a bag and superphosphate at USD 30, some of it smuggled and of uncertain quality. The General Organisation for Seed Multiplication produces about 50,000 tons of wheat seed against the annual needs of 340,409 tons. In Kobani, farmers said no agricultural diesel had been distributed this year, unlike under the Autonomous Administration. By late October, only about 10% of farmland had been planted, Welat TV reported, with ploughing at about USD 100 a hectare.

Cotton growers face the same uncertainty. On October 28, Hasakah agriculture director Hayel al-Kalash said the purchase price was “still under study” and that no decision had been taken on how the crop would be marketed, pending instructions from the General Establishment for Cotton Ginning and Marketing. He noted that collection centres had opened in Raqqa and Deir Ezzor and gins in Aleppo and Hama. That came almost three months after the ministry announced a price of (new) SYP 85 per kg.

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Why It Matters: The new circular makes clear who will wait longest for their money. Farmers in nine governorates, most of which delivered relatively little wheat, are to be paid everything at once. Deir Ezzor, which had already paid out most of its dues by mid-October, gets a fixed deadline. Hasakah, which supplied 42% of the country’s wheat this season, and Raqqa are to be paid in instalments, with no end date set.

At SYP 55,000 a ton, Hasakah alone is owed about (new) SYP 64 billion out of roughly SYP 151 billion nationally (USD 1.1 billion at the current back market exchange rate), so paying it in full at once would have required a large release of cash, something which might be both difficult logistically speaking (i.e. moving cash to the northeast), but also potentially disruptive for the currency market. This thinking maps exactly onto what the Central Bank has done elsewhere: limiting the amount of pounds in circulation to protect the currency, as it has with bank withdrawals (see “[TBA-link: October currency entry]”).

The flip side of this policy, however, is that wheat farmers have, in effect, become one of the Central Bank’s tools, lending the state their harvest money interest-free while the pound loses value.

As explored in previous issues of the Monthly Digest, the current wheat debacle matters politically for the future of the northeast integration. This was the first harvest that most northeastern farmers sold to Damascus rather than to the Autonomous Administration, and Kobani farmers already compare the new arrangements unfavourably with the old ones, under which diesel and seed arrived on time.

These last two factors, beyond delayed payments, will also prove critical for next year’s seasons, as per the Ministry of Agriculture’s own indirect admission. According to the Ministry’s own 2024–25 production plan, accessed by The Syria Dispatch, it credited the previous season’s results partly to early pricing of wheat and cotton, seed sold below cost, and diesel allocated to every planted field. This year, none of the three seems to be ready for planting, which starts in October.

The early signs match what we expected in September, when we argued that cash-short farmers would cut back on inputs rather than on the area they plant. One Hasakah farmer cut his seed rate by a quarter; fertiliser of uncertain origin is filling the gap left by the bank; and seed establishment covers only about 15% of national seed needs, so most farmers are sowing their own or market seed. Kobani, where only about a tenth of the land had been planted by late October, shows that the planted area can shrink too where high costs and payment delays combine.

Good early rain across the country may hide much of this until the harvest, as it did this year. October rainfall was about 60% of the long-term average for most of the country, but historically it has said little about the rest of the season given that October brings only 3–6% of a season’s rain, and in satellite estimates since 1989 its link with November–April rainfall is too weak to count on. Last season shows why: Hasakah had one of its driest Octobers on record before a winter that produced a record harvest.

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Key Developments: On October 11, President Ahmad al-Sharaa signed …

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Key Developments: On September 29, EU High Representative for Foreign Affairs and Security Policy Kaja Kallas visited Damascus, three weeks after Michael Ohnmacht presented his credentials to President Ahmad al-Sharaa, restoring EU representation at ambassador level for the first time since 2012.

At a joint press conference with Foreign Minister Asaad al-Shaibani, Kallas said the EU aimed to mobilize more investment and upgrade the partnership, but stressed that this depended on Syria and that investment required security, clear rules, the rule of law, and functioning institutions. As an idea of what the Commission expects from the Syrian authorities, on September 8, the EU told the UN Human Rights Council that adopting a new Constitution and building an inclusive political system would be essential to the transition. It described the formation of the People’s Assembly and Constitutional Court and the introduction of Kurdish-language teaching as milestones.

Kallas put existing EU support at EUR 620 million for recovery, humanitarian needs, and institution-building, plus EUR 51.5 million mobilized through EU foreign policy instruments, including around EUR 18.85 million for demining. She also said the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB) were discussing support for Syrian projects, though no agreement had been reached. She proposed technical talks this year, including on recovery and reconstruction, ahead of a second High-Level Political Dialogue before next summer; the first was held in May.

In turn, Shaibani said the two sides discussed a new partnership agreement to replace the 1977 Cooperation Agreement. He said Damascus sought inclusion in the EU’s 2028–2034 Multiannual Financial Framework, and called for lifting the remaining sanctions on Syrian state institutions.

The visit came days after the two met in New York on the margins of the UN General Assembly.

Leading up to this high-level engagement, Minister of Finance Yisr Barnieh had discussed on September 2 with Henrike Trautmann, Director for the Middle East at the Commission’s Directorate-General for the Middle East, North Africa and the Gulf (DG MENA), the activation of the Technical Assistance Hub due to open in Damascus with Commission funding. They also discussed workshops on public financial management, public-private partnerships, and public debt management, and support for establishing joint-stock companies. On September 22, Qutaiba Qadish, director of the Foreign Ministry’s International Cooperation Department, met Michael Karnitschnig, acting Director-General of DG MENA, in New York to discuss development cooperation and support for economic recovery.

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Why It Matters: Kallas’s figures look different once read against the documents behind them. The EUR 620 million is a two-year envelope for 2026 and 2027 and includes all of the humanitarian, development, and FPI support. As a result, the Commission’s bilateral development component amounts to EUR 280 million, or EUR 140 million a year, against EUR 139 million in 2025 (see table below). Thus, the EU’s annual development effort in Syria is flat.

Yet a lack of European finance or interest is not the only reason EU support may seem limited given the scale of needs inside Syria. The Commission’s 2026–27 programming describes Syrian absorption capacity as a “binding constraint.” That echoes the gap between funds available and funds used that a joint Commission–EIB mission recorded in 1982. The technical talks Kallas proposed ahead of the next High-Level Political Dialogue are the natural place to sequence both sides of the problem: what Syrian ministries can absorb, and what Brussels is prepared to commit.

Back to development support, the 2025 measure already allocated EUR 26.5 million to state and institutional capacity, but shared that envelope with health and directed most of its funding to livelihoods, microfinance and small businesses; Syrian institutions were consulted and trained, not contracted. The 2026–27 measure narrows that envelope to public administration alone, at EUR 30 million a year, covering public financial management, procurement, payroll and statistics, and makes national and local authorities eligible for direct grants. That support will reach the Syrian state through European intermediaries, with no financing agreement and no budget support. The terms, too, remain set in Brussels: both packages are Special Measures, an exceptional instrument adopted by Commission decision rather than negotiated with Damascus. A new partnership agreement and inclusion in the EU’s 2028–2034 budget cycle would replace these unilateral decisions with a negotiated, multiannual framework, as Foreign Minister Shaibani asked for.

However, Kallas tied further investment to the rule of law and functioning institutions, but the programming has moved in the other direction. The 2026–27 document dropped the “gradual and reversible” qualifier that framed 2025 support. More generally, the EU has never specified what it means by progress on the rule of law and functioning institutions, what benchmarks would measure it, or when it would reassess its approach. This matters most now, because European leverage is greatest while a new agreement remains a prospect; once one is signed, Brussels acquires a stake in the relationship’s survival. If the coming talks lead toward the partnership Damascus is asking for, they are also the moment to state what that partnership is for and how progress would be judged.

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Key Developments: On October 1, the state-owned General Company for Cement and Building Materials (Omran) signed a 30-year build-operate-transfer (BOT) contract worth around USD 200 million with Turkish company ÇİMKO to rebuild the destroyed al-Muslimiyah cement plant in Aleppo. They laid the foundation stone the same day in the presence of the Minister of Economy and Industry, Nidal al-Shaar, and Aleppo Governor Azzam al-Gharib. The project includes a new production line of 5,000 tons of clinker per day (around 1.65–1.8 million tons a year) and follows a memorandum of understanding (MoU) signed in late August. It is one of the largest partnership deals Omran has concluded since 2025. Those deals include the Tartous mills, now run by UAE-based QZ Group, and Hama’s third production line, being upgraded by Iraq’s Vertex Group (USD 300-375 million). The Adra plant near Damascus has yet to be awarded despite more than ten regional bids.

On September 16, Deputy Minister of Economy and Industry Basel Abdul Hannan met with the Syrian Investment Agency (SIA) and the General Establishment of Geology and Mineral Resources (GEGMR) to discuss a national investment map for cement, a more balanced spread of projects across governorates, and faster licensing. Three days later, Omran Director-General Mahmoud Fadila said the cement industry had moved “from crisis management to rebuilding,” adding that Omran is looking for strategic partners that can bring financing, technology, and operating expertise, and that the state should not bear the cost of rehabilitation alone. He rejected the idea that these arrangements amount to privatization, since Omran keeps responsibility for overseeing investors.

Yet, as the sector is still recovering from more than a decade of war, local consumption relies more on imports than on local production. According to the Ministry of Economy and Industry, Syria imported over 3 million tons of finished cement in the first half of 2026, more than double the level a year earlier, while clinker imports for local grinding rose more than tenfold. Industry figures presented in Damascus on September 5 put 2025 consumption at around 8 million tons, with imports covering more than 60%. Demand is also showing up in private producers’ results: Al-Badia Cement, the country’s largest private producer, roughly doubled its net profit in the first half of the year as sales rose 80%.

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Why It Matters: Given the lack of data across the country, looking at the cement market provides a relatively reliable proxy for reconstruction activity in Syria since almost every type of rebuilding, from repairing a damaged apartment to building a road or a new residential tower, requires it. Unlike most construction indicators, cement is also measurable: a small number of plants report production, and imports appear in partner countries’ customs data. In an economy where official statistics on construction output, building permits, or investment remain patchy, cement consumption is one of the clearest signals of how much is actually being built.

Consumption reached between 7.3 million tons (our estimate based on official figures) and 8 million tons (figures presented in Damascus in September) in 2025. That is more than double the 2023–2024 levels and approaching the pre-war peak of about 9 million tons (see table). However, the supply sources have changed significantly since before the war. While imports covered about a third of the market in 2010, they covered around 60% in 2025, mostly because Omran’s production fell from about 6 million tons in 2010 to under 2 million tons by 2022. Omran’s output collapsed largely because the war destroyed its Aleppo plants: al-Shahba was completely destroyed and Arab Cement was partly damaged, taking around 2 million tons of capacity out of production, while many of its remaining lines date back to the 1970s and are energy-intensive and outdated.

Türkiye remains the main supplier of finished cement, but Egypt and Saudi Arabia have emerged as suppliers since the collapse of the Assad regime. This trend continued into 2026: Turkish cement exports to Syria more than doubled in value in the first half of the year, while Egypt shipped over 330,000 tons of cement and clinker between January and June. The import mix is also shifting. Omran signed a clinker supply agreement with Egypt’s Cisco in January and began receiving shipments in March. According to the Ministry of Economy and Industry, clinker imports rose from about 5% of finished-cement import volumes in the first half of 2025 to 22% in the first half of 2026.

In practice, Syria increasingly imports semi-finished products (clinker) and grinds them at home, rather than producing clinker itself.

If the 2026 trend holds, consumption would reach around 9.5 million tons, slightly above its 2010 level, and could rise further as local demand increases.

The Ministry of Public Works and Housing announced on September 23 a target to build or rehabilitate 2 million housing units by 2035. It estimates Syria’s housing stock at 4.25 million units, of which 1.32 million are damaged, and puts the shortage at 1.9 million units, rising to 2.5 million by 2030 if supply does not accelerate. Assuming half the target is new construction and that a 100 m² concrete-frame apartment requires around 20–25 tons of cement, while repairs require only a fraction of that, the program would add roughly 2.5–3.3 million tons a year to demand until 2035. That would add to current consumption and infrastructure needs, which reconstruction estimates put above residential needs. In other words, a credible housing program would push demand well past the pre-war peak while new domestic capacity is still being built.

Yet, given current obstacles to local production, most of this additional demand would be met from abroad. Domestic production remains constrained by energy costs, and clinker is where those costs bite hardest. Making it requires firing limestone and clay in a kiln at around 1,450°C, and the rotary kiln that produces clinker alone accounts for 70–78% of the energy used in cement production, while grinding clinker into cement requires comparatively little. Earlier this year, Omran halted clinker production, citing energy tariffs that account for more than 65% of production costs, and has since relied largely on grinding imported clinker. Al-Badia’s H1 2026 accounts show the same pressure: its energy bill rose almost sixfold year on year and now makes up about half of its production costs, even as sales grew by 80%. The subsidized fuel that supported the sector’s pre-war profitability has been replaced by market-priced energy. Fadila has explained that Omran imports clinker from countries that subsidize energy, which suggests that for the most energy-intensive stage of production, importing is currently cheaper than producing at home.

The investment pipeline is meant to close this gap, with a map of the main cement plants showing most state-owned sites at the bid or proposal stage. Several have since moved forward:

• Al-Muslimiyah (Aleppo): contract signed on October 1 with Türkiye’s ÇİMKO.

• Tartous: mills in trial production since April under the UAE’s QZ Group.

• Hama: Line 3 upgrade under way by Iraq’s Vertex Group.

• Rastan: taken over by a local investor.

• Raqqa: agreement between Al-Hassan Holding and China’s Jiangsu Pengfei for an integrated plant.

• Al-Fayhaa: white cement plant began commercial operations in early 2026.

• Adra: still unawarded despite more than ten bids.

Taken together, the new clinker lines announced at Muslimiyah, Hama, Adra and Raqqa add up to roughly 21,000 tons per day. That is around 9 million tons of cement a year, enough in principle to replace most current imports, before even counting Al-Badia’s planned second line. Most of this capacity, however, will not come online before 2027–2030, and Adra has no investor yet, Raqqa is only an agreement, and none of the projects resolve the energy cost problem that led Omran to stop producing clinker. Fadila himself presents 2027 as the turning point, suggesting the next twelve to eighteen months will rely on imports and grinding.

Over the coming years, Syria’s dependence on imported cement and clinker is likely to deepen before it eases, leaving construction costs tied to regional energy prices and to supply from Türkiye, Egypt and Saudi Arabia. This also makes the housing target only as credible as the supply chain behind it: without lower domestic energy costs or a faster rollout of clinker capacity, a large-scale building program would mostly widen the trade deficit and push up prices. The partnership model therefore carries more weight than its contract values suggest. Omran retains ownership of the assets and oversight of investors, but how quickly Adra is awarded, and how quickly Hama and Muslimiyah reach full capacity, will largely determine whether Syria’s reconstruction is built with domestic or imported cement.

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Key Developments: At a Ministry of Energy seminar during the Damascus International Fair on September 2, Obada Mobayed, director of Water Sector Regulation at the ministry, said Syria consumes around 18 billion cubic meters of water a year against 16 billion in renewable resources. The two-billion-cubic-meter gap is covered mainly by groundwater and lake reserves. Agriculture accounts for around 88% of use, and dam reservoirs remain below 50% in the south and below 20% in Daraa and Quneitra despite last winter’s rainfall.

Energy Minister Mohammad al-Bashir told the People’s Assembly on September 20 that the flow of Ain al-Fijeh, Damascus’s main spring, had fallen from 40 cubic meters per second (m³/s) historically to around 1.5 m³/s. He said random drilling had dried out the Yarmouk basin, with an initial count of some 50,000 such wells in Daraa. Daraa Governor Anwar Taha al-Zoubi had given a similar figure on September 7, adding that 76 unlicensed drilling rigs had been seized since the fall of the regime. The governorate’s 16 dams, with a combined capacity of 92.5 million cubic meters, held less than 4 million in 2025, down from 65 million five years earlier. The governorate set a September 16 deadline before sealing illegal wells. A draft water law with deterrent penalties is with the General Secretariat of the Presidency.

The price of water depends heavily on whether a household is connected. Al-Bashir said piped water costs around (old) SYP 7 per cubic meter, and acknowledged that tariffs do not cover production costs. That is the 6–15 m³ tier set in August 2014, which the September 2023 increase left untouched, and works out to (new) SYP 0.07 (USD 0.0005). Tanker water in Daraa costs around USD 5 per 1,000 liters. Off the network, tanker water reached (old) SYP 300,000 (new SYP 3,000; USD 21.7) per load in Daraa’s Tal Shehab. In Shahba, Suweida, an 11-day power cut halted pumping and pushed the price of a tanker to around (old) SYP 600,000 (new SYP 6,000; USD 43.5). The governorate blamed that outage on attacks on the grid.

In the al-Bab area, MP Osama al-Nous said residents pay the equivalent of (old) SYP 2,700 per cubic meter (new SYP 27, USD 0.20) to private suppliers, and demanded equal treatment with the rest of the country. Al-Bashir promised a future review of tariffs in Idlib and northern rural Aleppo.

On repairs, the minister said service had been restored to 2.3 million people, 1,051 wells had been rehabilitated, and five wastewater treatment plants were planned. Most of the country’s wastewater still flows untreated into rivers, lakes, and the sea. Rehabilitating Aleppo’s treatment plant alone is estimated at USD 400 million, for which the ministry is seeking international financing.

On the Euphrates, al-Bashir said inflows from Türkiye had risen from around 200 to around 1,000 cubic meters per second. Haitham Bakour, director general of the General Establishment of the Euphrates Dam, put them at around 1,200 m³/s. The minister said Türkiye gave one day’s notice before raising releases earlier this year. He also said that encroachments on the riverbed mean 2,000 m³/s would cause problems, although the channel was designed for 3,000. The ministry opened spillway gate No. 6 at the Euphrates Dam, the first time in over 30 years, and scheduled releases of 1,200 m³/s until mid-October. By September 28, 11 water stations in Deir Ezzor had gone out of service, after floods in May and August had already affected around 50 stations in Raqqa and Deir Ezzor.

The longer-term pipeline is large but mostly at the study stage:

• Tigris–Khabour transfer: Designed to irrigate some 215,000 hectares, which al-Bashir costed at USD 2 billion and said would be offered for investment alongside the Halabiyeh–Zalabiyeh dam.

• Euphrates–Hisyah carrier: Priced at USD 571–572 million for 3 m³/s of mainly industrial and drinking water.

• “National carrier”: Would pump coastal freshwater to Damascus; its initial estimate stands at around USD 9 billion, with only a study contract signed.

• Desalination and transmission study. On September 7, ACWA and the Water Transmission Company signed a technical services agreement with the ministry and Germany’s Fichtner.

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Why It Matters: Water scarcity in Syria is not new, and Marwa Daoudy’s The Origins of the Syrian Conflict argues that it was primarily the product of policy rather than climate. The Ba’athist drive for food self-sufficiency put wheat and cotton under irrigation, so between 2001 and 2010, 70% of public investment in agriculture went to irrigation. Cheap diesel and nominal water fees made pumping groundwater almost free, and by 2009, unlicensed wells (around 108,000) outnumbered licensed ones (102,000), despite repeated bans and amnesty-style licensing campaigns. The Khabour, overdrawn to around three times its basin’s safe yield, fell from 60 m³/s to zero in 2001. When the drought of the late 2000s hit, the 2008 lifting of fuel subsidies tripled diesel prices just as farmers in the northeast most needed to pump. Daoudy’s broader point is that drought became a human-security crisis because of who was exposed to it and how the state had managed water beforehand.

The same lens fits today, because the burden of scarcity falls very unevenly, as a household connected to the public network pays (new) SYP 0.07 per cubic meter for its first 15 cubic meters (+/- USD 0.0005), a tier set in 2014 and left untouched by the 2023 increase. A household in western Daraa buying from a tanker pays around USD 5 for the same cubic meter, roughly 10,000 times more, in a region where monthly salaries run between USD 75 and 150. The tariff subsidy reaches those already connected, while those with broken networks, those whose pumps depend on an unreliable grid, as in Suweida, or those in areas served by private suppliers, as in al-Bab, pay market prices. Any move toward cost-based pricing, which the ministry is reportedly considering, will need to start from that gap. Otherwise, it risks raising bills for the connected while doing nothing for those outside the network.

Agriculture is where the volumes are, and it remains the economy’s main exposure to drought. The 2024/25 season was the driest since 2007/08, at around 72% of the 1991–2020 average across the country’s cropland (The Syria Dispatch calculations based on FAO data). Last winter’s rains were well above normal in the north, east, and coast, but only around normal in Daraa and below it in Rural Damascus. Daraa’s reservoirs remain below 20% after a roughly average season, which suggests the binding constraint in the south is now groundwater extraction rather than rainfall. With agriculture using around 88% of the country’s water, irrigation efficiency is the obvious lever. The framing matters, however. Mobayed suggested that better irrigation could double the irrigated area to one million hectares with the same quantity of water. In a country already drawing two billion cubic meters a year beyond its renewable resources, efficiency gains spent on expanding cultivation would leave the deficit, and the aquifers, where they are.

As springs and reservoirs fail, farmers drill, and each new well lowers the water table for its neighbors, leading to, for example, groundwater levels in parts of Daraa dropping by five to 10 meters.

In the 2000s, diesel costs acted as a rough brake on pumping, which is why the 2008 price shock hit farmers so hard. Today, solar-powered pumps have accelerated extraction by bringing the marginal cost of pumping close to zero, and the latest fuel price increases (see “Fuel Price Hike Triggers Nationwide Protests as Damascus Turns Back to Local Refineries”) will only strengthen that shift. Sealing wells is the governorate’s answer, but many wells supply drinking water to whole communities, and some cost their owners tens of thousands of dollars. Enforcement without an alternative supply will be resisted, as it was under the previous regime. That regime’s bans and licensing campaigns failed because it lacked monitoring capacity in the countryside.

A better water policy would look less like the project pipeline the ministry presented to Parliament and more like basin management. The Tigris–Khabour transfer, costing USD 2 billion, is the same scheme for which Russia’s Stroytransgaz signed a USD 2 billion contract in 2014 that was never executed. The coast-to-Damascus carrier stands at around USD 9 billion with only a study contract signed. Both depend on finding investors for projects whose returns rest on water priced at almost nothing today.

Cheaper measures would deliver sooner: metering wells and charging for abstraction; a water law that distinguishes a farmer’s livelihood well from commercial over-pumping; a tariff with a protected lifeline tier; and repairs to networks that lose water before it reaches anyone.

The Euphrates adds a final irony. The 1987 protocol with Türkiye guaranteed a minimum of 500 m³/s only “until the final allocation” among the riparians, which has never come. This autumn, Syria is releasing around 1,200 m³/s that it cannot store, after Türkiye gave one day’s notice, while the south runs dry. Without a flow agreement and without the means to move or store surplus water, the country remains exposed to both drought and flood from the same river.

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Key Developments: Cotton picking began in rural Raqqa in mid-September and in southern Hasakah on September 16, with the rest of Hasakah governorate following within abouttu ten days. Hasakah’s deputy agriculture director, Ezzeddin al-Hasso, described the crop as in good condition with limited pest damage. Mohammad Maari, head of the Ministry of Agriculture’s Cotton Office, said early indicators in Raqqa pointed to good production.

Raqqa farmers, by contrast, reported weak yields, often no more than 300 kg per dunum (3,000 kg per hectare); though it should be noted that such a yield would be in line with or slightly above recent years, based on Syrian government figures (see chart below), but well under pre-2012 figures. Ministry data put the planted area at 26,593 hectares (25,810 last season) and expected output at 79,467 tons (69,587), figures that fall well short of the 50,000 hectares and 150,000 tons Maari announced as the plan in April.

Hasakah planted 11,898 hectares against a 7,300-hectare plan, for an estimated 45,000 tons. Deir Ezzor went the other way: it produced 4,500 tons on 2,300 hectares in 2025, but farmers’ union head Hamad Abboud al-Khader said cotton had almost disappeared there this season. He cited production costs, fuel and electricity prices, and delays in paying farmers’ dues.

There seems to be confusion on whether a purchase price has been set. On August 4, the Ministry of Agriculture announced a purchase price for this season’s cotton of (new) SYP 85 per kg (USD 0.61 per kg; USD 610 per ton) against an estimated production cost of SYP 71 per kg (USD 0.51 per kg; USD 510 per ton), split between the Agricultural Production Support Fund providing SYP 30 and the General Establishment for Cotton Ginning and Marketing providing the remaining SYP 55. On September 18, however, Raqqa farmers complained that no price had yet been set, while two days after, Maari said one would be issued “in the coming period.”

Raqqa farmers demanded a price covering their costs, which some put at no less than USD 900 per ton, citing fertilizer at USD 800 per ton and picking labor at USD 150 per ton. By the end of September, private traders were offering no more than USD 700 per ton, while a farmer put circulating prices at USD 750–850, levels he said would not cover his costs. A Raqqa cotton ginner added that some cotton had sold at USD 650–700 per ton. He complained that exports via Türkiye were blocked because Türkiye requires a fumigation agent that Syria bars from import.

It should be noted that the recent increase in the price of fuel might have a devastating impact on the cotton season, given that diesel rose 40% to SYP 175 per liter on September 13, triggering road-blocking protests across farming areas of Hasakah, Raqqa, and Deir Ezzor and leading to localized fuel shortages.

Hasakah farmers said fuel shortages forced them to cut irrigations and that they had received no direct support, which Maari had acknowledged in April was limited to subsidized seed. Water shortages also added pressure, as a Raqqa farmer said the network water never reached his land, forcing 13 diesel-pumped irrigations as a barrel of diesel rose from USD 100 to USD 300 over the season.

On marketing, an agricultural official said the state was ready to receive the crop against Directorate of Agriculture certificates and to truck it at its own expense to gins in Aleppo and Hama. Hasakah farmers, pointing to the wheat season, said knowing who will buy the crop and how quickly they will be paid matters as much as the price.

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Why It Matters: Cotton was long Syria’s “white gold”. Around 2000, it was the country’s most important export after oil, and the industry reportedly employed about half a million people. It fed a textile sector whose public-sector exports alone were worth about USD 195 million in 2010, and which President Ahmad al-Sharaa presented in July, at the opening of NASTEX 2026, as a way out of poverty. Even on the ministry’s own estimate, this season’s crop is barely an eighth of the 671,700 tons harvested in 2011 (see table). It is also well short of the roughly 250,000 tons of raw cotton that the country’s mills need. Because almost all of the crop is now grown in Raqqa, Deir Ezzor, and Hasakah (see map), every hectare taken out of cotton costs picking, trucking, and ginning work, and farm income in the east.

The confusion over the price looks at least as much like a problem of integrating the northeast as a fiscal one, since Damascus is extending its institutions into the northeast, as it did with the oil sector in August. Until recently, cotton growers there dealt with the Autonomous Administration, which set its own price in dollars (USD 800 per ton in 2023) without committing to buy the crop. They now face a ministry price in Syrian pounds that, six weeks after it was announced, had apparently not reached Raqqa farmers or had not convinced them.

Financially, the price level is part of the problem, too, since at around USD 610 per ton, it is below what private traders are offering and well below the USD 900 farmers say they need. As a result, the state’s offer to truck the crop to the gins in Aleppo and Hama at its own expense counts for little if growers sell elsewhere. With exports through Türkiye blocked, however, private buyers have few outlets beyond Syria’s own mills. Farmers are left choosing between a state price that does not cover their costs and a private market that may weaken as the harvest comes in. The wheat season, in which dues remained unpaid months after delivery, gives them little reason to trust the state buyer even at a comparable price.

Finally, while higher fuel prices might affect this season to some extent, they will weigh even more on the next one. The September diesel increase came at the end of an irrigation season farmers had already paid for, but it will now feed fully into next spring’s planting decisions, along with higher electricity prices for pumping and fertilizer and labor priced in dollars. Deir Ezzor, where the crop has almost disappeared, shows how quickly growers abandon cotton once margins vanish, and Hasakah, which planted well beyond its plan, shows they come back when the numbers work. Planted area has been stuck at around 26,000 hectares for two years, and the 50,000-hectare plan is out of reach.

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Key Developments: Owing to one of the most prolific wheat seasons in years, with procurement closing at 2.75 million tons, the General Authority for Supply and Procurement put 200,000 tons of second- and third-grade durum, deemed surplus to milling needs, up for sealed-bid sale on September 17, with bids closing on October 20.

Yet, following up on The Syria Dispatch’s coverage over the past three months (July 1, August 2, September 6), payment of wheat dues remains incomplete, months after farmers sold their harvests to the government. Daraa’s Izraa branch had paid 38% of dues, about (old) SYP 500.3 million of a SYP 1.3 billion allocation, by September 1. In Hasakah, branch head Azzo al-Hamed said on September 6 that payment had been completed only for grain delivered up to June 17, and he tied disbursement to the Grain Establishment’s lists and Central Bank cash transfers. In Raqqa, farmers with invoices dated June 9–17 were still unpaid in early September. Near Qamishli, farmers who delivered in May were still waiting on September 24, with payments limited to one invoice or installment a week. In Hasakah, governorate officials promised to settle all invoices by the end of October, including those of farmers who delivered to Damascus and Homs (full silos, relocated storage sites, and risks at some silos led some farmers to deliver their harvests outside Hasakah).

Despite the difficulties, farmers’ protests have been relatively scarce, with two events recorded in late August and early September. Farmers in Ras al-Ain protested on August 30 for their dues and a local bank branch, while on September 3, Daraa farmers gathered on the Damascus–Daraa highway before heading to the Ministry of Agriculture, demanding protection, lower taxes, and guaranteed marketing at fair prices.

Minister of Agriculture Basel al-Suwaidan blamed payment delays on scarce new-currency notes, difficulty moving cash, security conditions in the east, and unprepared bank branches. He said payment is the Grain Establishment’s responsibility, not his ministry’s.

Payment delays clashed with loan repayment management as, in Raqqa, farmers said input debts of around USD 1,000 had, in some cases, doubled, and some farmers were avoiding creditors’ calls. One farmer in Hasakah said the contractors who harvested and transported his crop were demanding cash, not app transfers (i.e., via Sham Cash) or installments. In Hasakah, the Agricultural Cooperative Bank (ACB) deducted farmers’ outstanding fertilizer and seed loans from their wheat payments before paying them out. Some farmers alleged favoritism in who got paid, and brokers bought invoices at a discount. On Sham Cash, near Qamishli, brokers reportedly asked 7–10% to pay dues through the app.

The implications of payment delays for the upcoming wheat season have been laid out by the farmers themselves, with farmers in Hasakah warning that the delays left them unable to prepare their land, with some considering turning it to other uses. One Raqqa farmer said he could not buy fertilizer and seed and feared payments would run into February, while others warned they could leave land unsown, with plowing alone costing about USD 20 per dunum, and called for payment before planting. Delayed payments also affect more than wheat, as one farmer noted, who borrowed to finance maize and cotton that he normally pays for with wheat earnings (read “Cotton Harvest Opens Amid Price Confusion as Fuel Costs Squeeze Growers”).

Regarding the next season, the General Organization for Seed Multiplication announced it will distribute certified seed from November to February, sold for cash or on credit through the bank. Its director general, Ammar al-Mohammad, urged reopening bank branches in all governorates and issuing any seasonal loan decision before planting. Distribution in Homs was still awaiting the ministry’s seed price on September 29. Officials are confident that the season will go well, with Hasakah’s deputy agriculture director, Ezzeddin al-Hasso, expecting the wheat area to double.

For the northeast, the organization’s 2026–27 plan allocates certified seed to Hasakah, Raqqa, and Deir Ezzor, while local experts warned of mixed and impure seed in the markets.

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Why It Matters: Previous editions covered how the payment problem developed through an open-ended purchase commitment at a fixed price, financed with an allocation that fell short of the bill. Its less visible consequence is that the delays have eroded the price itself. Decree No. 120 raised the effective price from (new) SYP 46,000 to SYP 55,000 per ton. However, a farmer who sold to a cash buyer in July at around 20% below the official rate received roughly SYP 44,000, less than the price that triggered protests in half of Syria’s governorates in May.

A farmer who paid a broker 7–10% to cash out dues gave back more than half of the bonus. Meanwhile, the state has used farmers’ money interest-free for three to five months. Since farmers’ leverage peaks before delivery, as the May threats to withhold grain showed, and disappears once the grain is in the silo, many may draw the obvious lesson next season. They could hold back grain, sell to traders paying cash on the spot, or deliver only once payment terms are clear. Shifting official explanations will not help. The minister cited liquidity and security, while Hasakah’s deputy governor cited full silos, and two competing deadlines (end of October in Hasakah, end of November in the bank’s circular) now set a public test for the next harvest.

More importantly, farmers are making 2026–27 planting decisions without the information they need. The seed price was not set by late September, no seasonal loan decision has been issued, diesel rose 40% on September 13, and next year’s purchase price is unknown. Planted area may well hold up, since rainfed wheat is cheap to sow and many farmers kept seed. The more likely adjustment is cash-constrained farmers cutting fertilizer, certified seed, and irrigation, which will not show in sowing statistics but in next summer’s yields, unless rainfall masks it again.

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Key Developments: On September 16, the Ministry of Finance launched Syria’s first syndicated bank financing under an Islamic structure. It brings together the state-owned Commercial Bank of Syria and two private lenders, Al Baraka Bank Syria and QNB Syria, to fund the Al-Mujtahid–Bab Musalla tunnel and the final phase of the “Qasioun Journey” project in Damascus. The facility reportedly carries a sovereign guarantee, and while its value, tenor, profit rate, and the split between the three banks were not disclosed, The Syria Dispatch learned from two sources in Damascus that the loan amounts to USD 25 million, split roughly equally among the three banks.

The agreement was signed in the presence of Finance Minister Mohammad Yisr Barnieh, Central Bank Governor Mohammad Safwat Raslan, and the Governor of Damascus, as Barnieh described the facility as the first of its kind. He said it could open the way to financing larger projects for the public sector, economic institutions, and governorates through bank facilities and sukuk, two months after the first sovereign sukuk was floated. Damascus Governor Maher Marwan Idlibi said the two-kilometer tunnel linking west and east Damascus should take two to two-and-a-half years to build instead of the ten years foreseen under conventional planning. He also said that the Qasioun project is scheduled to open in summer 2027, and that the financing had been reviewed by the Supreme Fatwa Council and the participating banks, with limited profits and easier repayment terms.

Other banks also moved toward a return to lending during the month as, on September 17, the board of the state-owned Industrial Bank, chaired by Barnieh, approved its 2027 lending plans and discussed a joint facility with other banks to finance new production lines for damaged industrial facilities. Two days earlier, the private Cham Bank had signed a memorandum to finance purchases of housing units in Damascus’s Marota City, reportedly the first home-purchase financing announced by a Syrian bank since the fall of the former regime. It did not disclose amounts or terms.

On September 17, Qatar-listed Estithmar Holding announced it had completed the transfer of a 48.68% stake in Shahba Bank, formerly Byblos Bank Syria, from Banque Bemo Saudi Fransi and Ahli Trust Bank to its subsidiary Masaref Holding. Reuters had reported in January that Estithmar would take a 60% majority. The agreement signed on April 26 covered 49%. The company, chaired by Syrian-Qatari businessman Moutaz al-Khayyat, said it would work with the bank’s board on several proposals:

• a capital increase

• new branches in underserved areas such as Deir Ezzor, Hasakah, and Qamishli

• digital upgrades

• trade-finance and SME products

All of these remain subject to feasibility studies and Central Bank approval. Raslan welcomed the investment, provided it meets legal, regulatory, and governance requirements.

On September 27, Raslan said he expected foreign capital for new Islamic and conventional banks to exceed USD 1 billion, in a sector that currently counts six state-owned and 15 private banks. The licensing criteria he listed include applicants’ experience, reputation, and solvency, plus a strategic banking partner holding at least 10% of the new bank. He said foreign investors may keep up to 60% of paid-up capital in foreign currency and freely transfer profits. He added that Jordanian banks had applied to enter the market, and that the Central Bank plans to require international transfer providers to pay remittances exclusively in foreign currency. Raslan also called exiting the FATF grey list the top priority. These statements came two weeks after the Central Bank launched the first locally issued, internationally accepted payment card following its reconnection to Mastercard, and a month after Saudi Arabia agreed to set up a joint bank with Syria.

On September 21, on the sidelines of the Arab Regional Conference on Supporting Development and Investment in Syria in Amman, Raslan discussed with Union of Arab Banks Secretary-General Wissam Fattouh the possible creation of a Syrian banking association. It would serve as an umbrella body coordinating banks operating in the country. The two also discussed the advice the Union could offer on drafting banking laws and regulations. Earlier that day, Raslan met representatives of Al-Ahli Bank, Bank al Etihad, the Commercial Bank, and BLOM Bank, with several Syrian private banks in attendance. The Union had announced in February 2025 a project to restructure Syria’s banking sector with European partners. A week later, on September 29, it was reported that five private banks had not yet published their 2025 financial statements. The Central Bank attributed the delay to its approvals not yet being issued.

The reasons ranged from placements in Lebanon and full provisioning to plans to address capital erosion, board reshuffles, and the appointment of external auditors. Three banks had also not published their 2024 statements. The provisioning stems from a September 2025 Central Bank directive requiring banks to fully recognize their exposure to Lebanon, then estimated at over USD 1.6 billion.

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Why It Matters: Syria’s budget ran a deficit of about USD 1 billion in the first half of 2026, so it makes sense, against that backdrop, for the state to pool bank resources behind a sovereign guarantee rather than tie infrastructure to whatever the annual budget can allocate. If it works, the model could be extended to larger projects for the public sector, economic institutions, and governorates, as Barnieh suggested.

The size of the facility, however, says as much about the banks as about the project. Three of the country’s largest banks, including the state-owned Commercial Bank of Syria and the Syrian arm of Qatar National Bank, had to come together to provide USD 25 million, or roughly USD 8 million each, suggesting that few Syrian banks, if any, can carry an exposure of that size on their own. For comparison, the country’s 14 listed commercial banks (which published their 2024 financial accounts) held about USD 4.9 billion in deposits combined at the end of 2024.

The constraint is capital rather than liquidity, since a bank’s exposure to a single borrower is capped as a share of its own funds, and those funds have been eroded by fifteen years of depreciation. Law No. 3 of 2010 set the minimum capital for a conventional bank at SYP 10 billion and for an Islamic bank at SYP 15 billion, about USD 215 million and USD 320 million at the time. Today the same amounts, (new) SYP 100 million and 150 million, are worth around USD 0.7 million and USD 1.1 million. As a result, given that lending capacity is quite thin, a sovereign-guaranteed loan to a governorate will look more attractive to a bank than a riskier loan to a factory, which could crowd out private-sector financing. This is what we have already warned of regarding the issuance of sukuk, or Islamic government securities.

This is why the Shahba transaction matters beyond the bank itself, given that Estithmar’s stake is the first foreign equity investment in the sector since the fall of the former regime. Given the sector’s small size, the capital increase is what it needs most among Estithmar’s proposals. Small, thinly capitalized banks that cannot lend at scale are one of the main things holding back Syria’s banking system.

Bankers who spoke to The Syria Dispatch said existing shareholders and strategic partners have so far been reluctant to put in fresh capital. Many of those partners are Lebanese banks still dealing with their own crisis, and the sellers in this case reportedly planned to use the proceeds to recapitalize their own banks rather than Shahba. If Estithmar follows through, one well-capitalized competitor could push others to do the same, but peer pressure alone is unlikely to be enough, though.

The Central Bank would also need to update the minimum capital requirement with a clear compliance timeline, as the 2010 law did when it gave banks three years. Otherwise, the sector risks splitting in two: new entrants, if Raslan’s USD 1 billion materializes, would arrive with fresh capital, while incumbents would remain undercapitalized after absorbing their Lebanon losses, and five of them still have not published 2025 accounts. (On the Central Bank’s strategy under Raslan READ here.)

The banking association should be read in the same light, and its value will depend on the legal framework around it. Syrian banking regulation is currently spread across several texts, including Law No. 28 of 2001 on private banks, Law No. 23 of 2002 (Basic Monetary Law) on the Central Bank and the monetary system, and Law No. 35 of 2005 on Islamic banks. A comprehensive banking law would be the natural place to define what an association can and cannot do.

According to the same bankers speaking to The Syria Dispatch, private banks barely communicate with each other today, apart from meetings convened by the Central Bank and informal contacts between executives. Nobody wants a cartel, and Lebanon shows what happens when a banking association becomes a lobby.

In 2022, a minister described the Association of Banks in Lebanon’s opposition to sharing losses as a threat to the IMF deal. Syria’s more immediate risk, however, is the bad apple. Exiting the FATF grey list is the Central Bank’s stated priority, and correspondent banks judge the sector as a whole. A single opaque or non-compliant bank therefore raises costs for every other bank. A forum with a clear mandate agreed with the Central Bank could do several things:

• agree common compliance and disclosure standards

• pool training and anti-money-laundering tools

• coordinate with correspondent banks

• put peer pressure on laggards

Pricing and competition would stay outside its remit, under Central Bank oversight.

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Key Developments: On September 28, the Presidency’s General Secretariat directed public bodies to cut non-essential spending and review investment projects, at the Ministry of Finance's request. Secretary-General Abdul Rahman al-Aama signed Circular No. 41/15/B on September 23, 2026, invoking the Financial Basic Law (Legislative Decree No. 54 of 2006). It requires prior ministerial approval for travel and official missions, and cuts spending on conferences, hospitality, printing, subscriptions, and telecommunications to the minimum. It freezes purchases of furniture, office equipment, and administrative vehicles. New or renewed leases are barred where a usable state-owned alternative exists, non-urgent maintenance and office renovation are deferred, and external studies and consultancies are scaled back. Petrol and diesel allocations for government vehicles are cut by 30%, except for collective transport and vehicles allocated 70 liters or less per month, and the Ministry of Energy will report monthly on fuel consumption. Salaries and wages are exempt from the cuts, along with spending on health, education, water, energy, security, public safety and essential maintenance. Finance Minister Mohammad Yisr Barnieh attributed the measures to higher energy and transport costs tied to regional developments.

The circular also orders an urgent review of all approved investment projects, sorting them into three tiers:

• Priority projects continue within existing appropriations: those linked to essential services, public safety, asset protection or critical infrastructure, those whose suspension would cause actual harm, and those that raise revenue or output, cut costs or save foreign currency.

• Postponable projects, whose delay would not substantially affect services or economic activity, have new spending and commitments temporarily suspended.

• Non-priority projects have new spending and commitments stopped, with the Ministry of Finance reclaiming the resulting uncommitted appropriations.

Exceptions may be granted for commitments made before the circular, projects at an advanced stage, externally financed projects that would lose their funding if stopped, and projects with a documented direct return.

Splitting projects or reclassifying spending to get around the rules is prohibited. Entities may not redeploy the savings; the ministry will pool them and propose reallocating them. Public entities have 15 days to report halted spending and expected savings to the ministry, which will report periodically to the Presidency.

That same day, Barnieh said the 2027 budget would be completed in October and that he expects its deficit to be lower than this year’s USD 1.8 billion, the figure projected in the 2026 budget. At an Arab Monetary Fund workshop in Abu Dhabi the following day, he said the 2027 budget would include a medium-term fiscal framework for the first time.

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Why It Matters: The 2026 budget was the first full-year budget prepared by the new authorities, and it marked a deliberate shift, with the IMF attributing the small 2025 surplus mainly to spending restraint. The 2026 budget then planned spending of USD 10.5 billion, more than three times the USD 3.4 billion spent in 2025, against revenue of USD 8.7 billion. The resulting deficit of about USD 1.8 billion, some 5% of GDP, was to be financed mainly through bonds and sukuk, with some returns from the sovereign fund. The budget was, in effect, a bet that revenue would materialize quickly enough to fund a much larger state. That revenue was expected to come from oil and gas, which should provide around 28% of receipts, and from one-off items such as the second mobile license.

As The Syria Dispatch noted last month, the first half of the year showed that the budget is under strain, with the deficit reaching 56% of its annual allowance in six months. The minister had already lowered full-year revenue expectations to close to USD 8 billion, and the ministry warned that spending would accelerate as the wage increase took full effect. At that pace, the deficit was on course to overshoot by several hundred million dollars, with no sukuk yet issued and no domestic market able to absorb one. The September circular is effectively the government’s acknowledgment of that trajectory, and best read as a commitment to hold the line at the budgeted figure.

Choosing to cut spending deserves credit, because fiscally stretched, fragile, and post-conflict states typically fall back on two forms of financing that require no one’s agreement. The first is arrears to suppliers, which the IMF describes as “forced financing”, while the second is debt monetization, which the IMF counts as a standard feature of fragile states. The current government has so far avoided the second, a break with the former regime’s practice.

Yet whether Syria is also avoiding arrears is harder to establish because the budget is kept on a cash basis (Article 5b of the Financial Basic Law), meaning deferred payments to contractors would not show in the reported deficit, and the ministry has not disclosed how it financed the first-half gap.

What can be said is that the ministry published mid-year execution data that made the problem visible and proposed corrective measures within weeks. It protected wages and core services, and attached deadlines and reporting lines to the process. The measures also start in the right place: administrative spending had executed 65% of its annual allocation in the first half, the fastest of any category.

The circular also relies on a tool that the Financial Basic Law provides for exactly this situation:

• Article 7(a) requires the budget to be prepared with regard to the balance between expenditure and revenue, a principle loose enough to accommodate the 2026 budget’s planned deficit.

• Article 7(b) allows the suspension of certain expenditure commitments, on the Finance Minister’s proposal, when needed to preserve that balance. The circular explicitly invokes this provision.

The law vests the Article 7(b) power in the Council of Ministers. Under the Constitutional Declaration, however, the president is also head of government, and the Presidency’s General Secretariat exercises the power. The ministry’s 2025 draft of a new Financial Basic Law would formalize the General Secretariat’s role in the budget process, but a year on, the government is still operating under the 2006 text.

It should be noted that the Financial Basic Law also sets the timetable for the 2027 budget to meet:

• Article 13: The draft must reach the legislature at least two months before the fiscal year begins, which leaves until the end of October.

• Article 6: If the budget is not approved by January 1, spending reverts to monthly one-twelfths of the previous year’s appropriations, as happened throughout 2025.

• Article 16: Any supplementary appropriations require legislative approval in the same way as the budget.

• Article 32: The closing accounts must ultimately be approved by law.

While the People’s Assembly only convened in July after the 2026 budget was issued, the 2027 budget is therefore set to be the first to go through that full process.

Back to the 2026 fiscal year, the limits of the exercise are clear. Savings on travel, hospitality, furniture, and fuel are modest compared with a wage bill that made up 36% of first-half spending and will depend on compliance, largely self-reported by the ministries concerned. As a result, most of the adjustment is likely to fall on public investment, which already accounted for about USD 1 billion, or 28%, of first-half spending, and it is the part of the budget most directly tied to reconstruction. The exemption for externally financed projects will relatively protect donor- and loan-funded work. The flagship Gulf-backed investments are largely privately financed and sit outside the budget; their exposure lies instead in the sovereign guarantees the minister says will be used sparingly.

Three disclosures would make the exercise more credible: the list of projects in each tier, a numerical savings target, and how the remaining deficit is being financed, a gap already noted in last month’s edition. The minister also stated that wage increases were financed from real resources rather than deficit financing, which sits uneasily with the ministry’s own attribution of the first-half deficit primarily to wages. The 2027 budget will show whether the lesson has been absorbed, depending on whether it rests on the conservative revenue estimates the IMF has called for rather than the assumptions that produced this year’s overshoot.

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Key Developments: On September 12, the Permanent Committee for Determining the Prices of Petroleum Products and Mineral Resources, established under Decision No. 844 of 2026, issued a “temporary” price bulletin effective the next day, raising diesel from (new) SYP 125 to SYP 175 per liter (USD 0.95 to USD 1.27), 95-octane gasoline from SYP 152 to SYP 195 (USD 1.10 to USD 1.41), and 90-octane gasoline from SYP 147 to SYP 185 (USD 1.06 to USD 1.34). The previous prices had themselves been set only on September 4, through a daily bulletin rather than a formal decision, after a summer of repeated adjustments. The latest hike more than doubled the cumulative increase since February for diesel and raised it to about 86% for 95-octane gasoline, compared with roughly 44% for Brent.

The Ministry of Energy attributed the rise to the global cost of refined products, with diesel near USD 1,400 per ton, and to a comprehensive two-month overhaul of the Baniyas refinery, which Minister of Energy Mohammad al-Bashir later said would lift its capacity to around 130,000 barrels per day. The ministry put imports at around 60% of daily diesel supply and domestic crude output at about 100,000 barrels per day against needs of around 300,000, while official estimates of demand that week ranged up to 350,000. The ministry also reported that the Syrian Petroleum Company (SPC) was owed USD 1.7 billion by the Syrian Electricity Company for 2026. At the parliamentary hearing on the price increase, Bashir said that a Qatari grant covering about half of Syria’s imported gas for power generation had ended in August, leaving the ministry buying all of it at around USD 140 million a month. Because the Ministry of Finance had not budgeted the full bill, gas purchases would be cut by 2–3 million cubic meters a day, reducing electricity supply hours.

Protests began on September 13, the day the new prices took effect, in Markada and across the Hasakah, Deir Ezzor, and Raqqa countryside, where demonstrators blocked crude tankers heading to the interior, echoing the June unrest in Qamishli. They spread to Azaz and al-Bab in the Aleppo countryside and to Hama, Khan Sheikhoun, and Maarat al-Numan, in what was described as the most widespread unrest since Assad’s fall.

On September 17, after meeting President Ahmad al-Sharaa, Bashir announced three diesel grades: (new) SYP 115 (USD 0.83) per liter for heating, agriculture, and eligible groups; SYP 150 for transport, heavy machinery, and some productive uses, secured with unnamed “brotherly countries”; and SYP 175 (USD 1.27) for standard diesel, which he said costs SYP 206 (USD 1.49) per liter at a diesel price he put at USD 1,590 per ton (Note: SYP 206 was worth USD 1.59 at the time of the declaration). Standard diesel would be sold at all stations, the SYP 150 (USD 1.09) grade at 80–85% of them, and the SYP 115 (USD 0.83) grade at around 15%, selected by committees in each governorate. Bashir explained that the ministry had delayed raising prices until SPC’s losses ended its transfers to the Treasury, and the Ministry of Finance pressed for revenue.

The cheapest grade will come entirely from local, electrically powered refineries with a combined capacity of 35,000 barrels per day, run under SPC supervision on crude that SPC CEO Youssef Qablawi said would come from Rmeilan or Deir Ezzor. Bashir described the plan as an expansion of an existing Hasakah contract from about 17,000 to 35,000 barrels per day, the units’ full capacity, using surplus heavy crude that Baniyas cannot process and that had previously been exported, and acknowledged that the units are uneconomic and environmentally harmful. Most of these units sit around the Rmeilan, Suwaydiyah, and Tal Adas (Gir Zero) fields in Hasakah, where crude deliveries stopped in August when Al-Jazira Oil Services Company’s supply arrangement expired, cutting diesel to bakeries, transport, and generators from August 30.

On September 9, Hasakah Deputy Governor Ahmad al-Hilali met with generator owners who were asking for diesel allocations, and the following day, some refineries at Tal Adas and Suwaydiyah reportedly resumed work under a six-month agreement with SPC. Earlier, on September 3, more than 1,000 workers from these refineries protested their dismissal and blocked the road to Rmeilan, claiming they had been promised integration into SPC after a three-month contract with US firm HKN paid in dollars. The return to local refining comes weeks after SPC completed the removal of some 2,000 primitive refineries in Deir Ezzor and Hasakah, and months after protests over the closure of makeshift refineries in Aleppo. Qablawi also announced plans to bring a ready-built refinery to the east and to build three more.

The effects of the hike spread quickly to services: in Hasakah, the fare to Qamishli rose from (new) SYP 300 to SYP 500, and water deliveries reached SYP 750 per cubic meter. Abdulrazzaq Habazza, secretary of the Consumer Protection Association, estimated that low-income workers could spend about 30% of their wages on transport, and that goods prices had risen around 15%. He warned that the three-tier system had been launched without an implementation mechanism, inviting mixing between grades, a risk Bashir himself acknowledged. The Minister also told Parliament that the Ministry of Social Affairs had yet to complete the database of vulnerable households on which targeting of the cheapest grade depends.

Shortages persisted alongside the price rise, which might have also exacerbated them. On September 24, Hama’s energy services directorate closed five of the city’s roughly ten stations for a week to halt fuel orders; one owner said he had cut orders for fear of an official price cut that the Syrian Company for the Storage and Distribution of Petroleum Products (SADCOP) would not compensate, while residents reported hour-long queues and street-vendor petrol at (old) SYP 25,000 per liter (new SYP 250, USD 1.81). In Sweida, petrol deliveries had already been limited to two orders a day since July, with more than 200 mobile sellers charging new SYP 230–250 per liter (USD 1.67-1.81).

Separately, the Damascus Governorate ordered private generators off public sidewalks by September 30, and owners warned they would pass relocation costs on to subscribers.

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Why It Matters: The ministry’s arithmetic is hard to dispute. At USD 1,590 per ton, every liter of standard diesel sold at SYP 175 still loses SYP 31, and SPC can no longer cover both its imports and the roughly USD 250 million a month it had been transferring to the Treasury. The government has done little to explain why fuel became more expensive just weeks after Damascus completed its takeover of the northeast’s oil fields, a recovery presented as the end of the country’s energy dependence.

Part of the answer surfaced only at the parliamentary hearing, a week after the hike, when the Minister said that 80,000 of the 100,000–110,000 barrels produced each day are heavy crude that Baniyas cannot refine. At the same time, the state’s supply obligations doubled: the ministry now supplies Hasakah, Deir Ezzor, and Raqqa, and has shut the burners that met 5–10% of demand. Taking the fields added consumers faster than usable barrels, a point not lost on MPs, recalling earlier promises that Syria would not import a liter of products.

The gap is sharpest where the oil comes from: the governorates that watch crude trucked west were the first to block the trucks, as Qamishli did in June. It also falls on households with little margin left, in a country where about 90% of people live below the poverty line. The 550% wage increase that SPC’s transfers helped fund is being eroded by the same fuel bill, widening the distance between the recovery described in Damascus and what people pay at the pump, the bakery, and the generator.

Agriculture and industry carry the second-round effects. In the northeast, irrigation pumps, tractors, and harvest transport run on diesel. The hike came at the end of a cotton season in which a Raqqa grower said a barrel had already risen from USD 100 to USD 300, and in which the crop has almost disappeared from Deir Ezzor (see “Cotton Harvest Opens Amid Price Confusion as Fuel Costs Squeeze Growers”). It also came as farmers prepare to plant wheat while many are still owed for last season (see “Unpaid Wheat Dues Shadow the New Planting Season as the State Sells Its Surplus”).

The SYP 115 grade meant for them is waiting on a beneficiary database that the Ministry of Social Affairs has not completed. Industry is partly cushioned on fuel oil, sold at USD 400 per ton against an import cost of about USD 570, but not on electricity. With the Qatari gas grant over, the ministry plans to cut gas purchases by 2–3 million cubic meters a day, which means fewer supply hours for industry, which takes about 40% of power. Bashir’s claim that fuel is only about 2% of production costs does not hold for energy-intensive producers. Energy exceeds two-thirds of Omran’s clinker costs and makes up about half of Al-Badia’s, which is why Omran has stopped producing clinker and now grinds imported clinker instead (see “Cement Demand Returns to Pre-War Levels as Syria Turns to Imported Clinker to Fill the Gap”).

The three-tier system eases immediate pressure but introduces new risks, as a SYP 60-per-liter gap between the cheapest and the standard grade strongly incentivizes diverting subsidized diesel or blending it into the standard product. Bashir acknowledged as much, noting that three grades need around ten inspection rounds instead of one or two, and that a four-day gasoline shortage had already produced 172 station violations.

Subsidized bakery diesel was itself resold on the market until support was switched to flour. The cheapest grade will also depend on discretion: governorate committees will sell it at about 15% of stations. Its supply comes from burner refineries whose doubling to 35,000 barrels per day was handled as an extension of an existing Hasakah contract, while MPs’ questions on operating costs and on who measures crude in and diesel out went unanswered. That sits uneasily with the USD 28 million fraud uncovered in Deir Ezzor over the summer, and with the burner closures the ministry had presented as a health and environmental priority.

Bashir ruled out announcing price changes in advance because it invites hoarding, a real risk, as Hama’s station owners showed. But publishing the pricing formula and a schedule for phasing out subsidies is not the same as announcing the date of each change. Combined with direct cash support for the poorest households, it would leak less than three grades of diesel and make the next increase easier to explain.

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Key Developments: Syria’s economic relationship with Türkiye deepened across almost every sector in August, driven by a sequence of high-level visits. The Turkish energy and trade ministers each traveled to Syria, a deputy industry minister toured northern industrial zones, and a Turkish delegation of some 40 companies attended a bilateral business forum in Damascus timed to the opening of the 63rd Damascus International Fair. The engagement produced instruments covering hydrocarbons, mining, industrial-zone expansion and border infrastructure. Turkish customs data published during the month showed bilateral trade at a record USD 3.73 billion in 2025, but also that Syrian exports to Türkiye had fallen by nearly half over the same period.

These developments followed a presidential decree issued in the first week of the month that appointed a Türkiye-based businessman and founding officer of the Syrian–Turkish Business Council to head the state body responsible for licensing foreign investment. Indeed, on August 5, President al-Sharaa issued Decree No. 162 of 2026 naming Rawad Ramadan Director-General of the Syrian Investment Agency (SIA), replacing Talal al-Hilali, who had held the post since June 2025. Ramadan was described as a rising figure in Syrian business who has headed the Syrian Council for the Coordination of Joint Business Councils at the Ministry of Economy and Industry since January 2026 and previously served as deputy chairman of the Syrian–Turkish Business Council since its formal establishment in August 2025. Ramadan serves as executive board chairman of Isra Holding in Türkiye, a group active in real estate development, construction, energy, and investment funds. Notably, Syria’s Ministry of Economy and Industry has met with Isra Holding since June over the rehabilitation and expansion of Bab al-Hawa Industrial City, and the two signed the expansion agreement at the Damascus International Fair on August 26.

Before the Fair, Turkish Energy and Natural Resources Minister Alparslan Bayraktar traveled to Damascus on August 19, where President al-Sharaa received him at the People’s Palace, before signing several energy agreements with Syrian Energy Minister Mohammed al-Bashir. Bayraktar said state oil company TPAO and private Turkish firms were ready to conduct seismic surveys and exploration drilling on Syrian onshore and offshore blocks, with TPAO able to begin “immediately.” The visit also led to the signing of a phosphate-related memorandum of understanding (MoU), which the Turkish Ministry of Energy described as concluded between Turkish state mining company MTA International Company (MTAIC) and Syria’s general directorate for mineral resources. The Syrian Ministry of Energy characterized the instrument as a tripartite MoU in earth sciences and mining, and named MTA director-general Vedat Yanık and International Mining Company chief executive Nail Yıldırım as part of the delegation. Bayraktar said the MoU would extend to sulphuric and phosphoric acid production, rehabilitating the phosphate transport fleet, and building a railway linking the fields to a port.

In the electricity sector, Minister Bayraktar said commissioning the Birecik–Aleppo line announced in May would nearly triple Turkish electricity exports to between 800 and 900 MW, with the new infrastructure entering service “in the coming weeks”, while al-Bashir put the line’s entry into service at the end of September, delivering around 500 MW of additional electricity to Aleppo and its surroundings. Türkiye currently exports 281 MW and pipes 3.4 million cubic meters of gas per day through the Kilis line opened in August 2025, according to Bayraktar.

On the commercial side, Turkish Trade Minister Ömer Bolat inaugurated on August 14 a truck waiting terminal at Cilvegözü on the border with Bab al-Hawa alongside the head of the General Authority for Borders and Customs (GABC) Qutaiba Badawi, stating that bilateral trade grew 16 percent in the first seven months of 2026 after a 45 percent rise across 2025 to roughly USD 3.75 billion. Badawi said transit truck movements rose from about 3,500 in 2025 to more than 30,000 in the first seven months of 2026, and that six crossings are operational with Qamishli–Nusaybin under technical preparation. Speaking in Aleppo on August 27—his first visit to the city since 2004—Bolat put 2025 trade growth at 42 percent, said he had met Syrian ministers three times in a month, and reported a Syrian commitment to complete reopening of the Qamishli crossing by year-end. Türkiye’s trade ministry separately reported continuing expansion works at Cilvegözü (Bab al-Hawa on the Syrian side), Akçakale (Tal Abyad), Öncüpınar (Bab al-Salameh), Çobanbey (al-Rai), Karkamış (Jarablus) and Nusaybin (Qamishli).

In industry, a delegation from Türkiye’s Ministry of Industry and Technology, headed by deputy minister Oruç Baba İnan, entered Syria at the al-Rai crossing on August 19, where Deputy Minister of Economy and Industry Basel Abdul Hannan received it, and over the following day toured the al-Rai, al-Bab, Sheikh Najjar and Bab al-Hawa industrial cities before İnan met Economy and Industry Minister Nidal al-Shaar. At the Syrian–Turkish Businessmen Forum on August 26, attended by the 40-company Turkish delegation led by Bolat and Turkish Exporters Assembly chairman Mustafa Gültepe, Federation of Syrian Chambers of Commerce head Omar al-Ali announced work to raise trade to USD 10 billion. Newly-appointed SIA Director-General Rawad Ramadan addressed the same forum, telling participants that Syria needed broad investment across energy, infrastructure, real estate, tourism, agriculture and services. On the same day, the management of the Bab al-Hawa Industrial City and Isra Holding (Mr Ramadan’s company) signed an agreement for the expansion of Bab al-Hawa Industrial City with the aim of creating some 2,000 industrial investment opportunities.

In finance, Minister Bolat said further steps are expected on Turkish banks operating in Syria, following the Central Bank of Syria’s July 29 agreement to open an official account at the Central Bank of the Republic of Türkiye.

Why It Matters: In the reading circulating in Damascus, Talal al-Hilali had come to be seen as too closely aligned with the UAE, and both Ankara and Riyadh had grown uncomfortable with him; Rawad Ramadan’s elevation reads as a correction, placing at the head of the investment agency a figure whose commercial base is in Türkiye and whose institutional role since January has been coordinating Syria’s joint business councils. Notably, Ankara’s push arrived alongside the Saudi commitments covered in another entry of this month’s edition, and Ramadan’s appointment is one both capitals could welcome.

Yet, this appointment appears to carry an obvious conflict of interest, as hinted at in the Key Developments section. The SIA licenses foreign investment, and its new director-general chairs a Turkish holding company active in construction, real estate and energy; three weeks after his appointment, that company signed an industrial-zone expansion agreement with a state-managed entity at the Damascus International Fair, on a day when Ramadan himself addressed the accompanying business forum in his official capacity. As of publication, none of this has been publicly addressed, and no Syrian institution has published a conflict-of-interest framework that would govern the situation. For a state courting investors on the promise of predictable rules, leaving the question unanswered is a needless cost.

On the agreements and promises made in August, interconnection capacity, gas, phosphate processing, industrial-zone rehabilitation, and expanded crossings are all positive inputs that could raise what Syria can produce and move, rather than substituting for it. The Birecik–Aleppo line, if it enters service on the timetable al-Bashir gave, is the single largest addition to Syrian electricity supply in prospect. Yet the composition of trade is where the enthusiasm should stop.

Turkish Statistical Institute data show bilateral trade at a record USD 3.73 billion in 2025 and Syrian exports to Türkiye falling 46 percent over the same year, from USD 438 million to USD 235 million, reversing four consecutive years of gains. The export-to-import ratio widened from 5:1 to 15:1, and the partial 2026 figures point the same way. Syria is quickly losing ground as a supplier to its largest trading partner, and a USD 10 billion target reached on the present composition would mean roughly USD 9.4 billion of Turkish goods entering a market whose own producers are already struggling to compete against them.

Whether that is integration or displacement depends entirely on what crosses the border, and nothing announced in August distinguishes between the two, as Syrian industrialists have long been complaining of the current status quo. But the authorities in Damascus can still make that distinction through tariff structure, standards enforcement, and the sequencing of industrial-zone rehabilitation against import liberalization. Using such tools can be seen as protectionist and might run counter to the free-market philosophy adopted by the transitional government, yet it would ensure that the border crossings whose capacity is being expanded carry Syrian goods northward as well as Turkish goods south.

Overall, however, the expansion of Turkish economic weight in Syria is, on balance, good for the country: foreign direct investment, capital, inputs, and market access, from a neighbor with the industrial capacity to supply them. Still, as Turkish interest in Syria, both politically and commercially, grows, so does the Israeli–Turkish dispute being conducted on Syrian territory. On August 18, Israeli aircraft struck the Abu al-Duhur airbase in eastern Idlib, as Netanyahu’s office stated that Israel and Syria had agreed to a security status quo which Damascus was on the verge of breaching by allowing Turkish troops to deploy at the base, and that repeated Israeli warnings had been ignored. A Turkish official rejected the premise, saying no Turkish troops had been at the airbase.

Regardless of who wins the blame game, however, the costs of that exchange ultimately fall on Syria. The airbase is Syrian, the sovereignty violated is Syrian, and the reputational damage accrues to Syria rather than to either party to the dispute. The Syria Dispatch heard consistently from Turkish businesspeople in Ankara and Istanbul during August that the Israeli threat now features in their investment calculations, and that they consider themselves specifically exposed precisely because they are Turkish. That is the practical damage, and it lands on the same commercial relationship this entry has otherwise described as expanding.

Ankara and Tel Aviv have channels through which to manage their differences, and Syria’s reconstruction should not be the venue.

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Key Developments: August produced the densest month of Syrian–Saudi commercial activity since the February 2026 Riyadh package, falling into two clusters: an energy round at the start of the month, and a concentrated week from August 26 in which the Saudi transport minister’s visit, a central bank agreement, and the 63rd Damascus International Fair produced instruments across transport, finance, water, agriculture, and heavy industry.

On August 5, Syrian Electricity Company (SEC) executive director Omar Shaqrouq signed three power purchase agreements (PPAs) with Saudi contractor Mohammed A. Al-Harfi for three solar power plants totaling 760 MW of energy generation, in addition to 1,077 MWh of battery energy storage system (BESS) at Wadiyan al-Rabi in Rural Damascus, branded under the Shams al-Sham initiative and valued at roughly USD 1 billion. These three PPAs were followed by two accompanying technical cooperation agreements between Al-Harfi and Saudi Electricity Company for Projects Development (PDC) and Germany’s Siemens Energy, respectively. The projects appear to supersede the earlier February memorandum for 210 MW of solar power generation and 827 MWh of BESS. Also in the energy sector, Deputy Energy Minister for Oil Affairs Ghiath Diab received a Saudi energy ministry delegation on oil and gas cooperation on August 9.

In parallel, Saudi-Syrian collaboration extended to the transport sector, with significant sums at play there too. On August 20, the General Establishment for Road Transport awarded the Damascus–Palmyra–Deir ez-Zor rehabilitation contract to Syria’s Al-Kawati and Saudi Arabia’s Al-Rawaf at roughly USD 300 million over 780 days, covering some 425 kilometers of the corridor linking the capital to the east. Furthermore, the Minister of Transport’s Assistant Mohammad Rahhal and Saudi Deputy Minister of Transport Rumaih Al-Rumaih reviewed land transportation developments, rail and transit links, and logistical cooperation. The two parties noted truck traffic on the Türkiye–Syria–Jordan–Saudi axis had risen from about 10 to 30 vehicles daily against a target of 100, and that Syrian drivers were waiting 40 to 50 days for visas. On that last point, the two sides agreed to place the acceleration of multiple-entry permits on the agenda of the Saudi transport minister’s visit to Damascus at the end of the month, alongside driver license recognition and truck specifications. Still, despite the delays, Damascus exporters welcomed Riyadh’s resumption of driver visas after a fourteen-year suspension, saying it removed the high cost of transloading at the border.

Eventually, Saudi Transport Minister Saleh bin Nasser Al-Jasser’s visit to Damascus on August 27 led to the signing of four agreements on roads, rail, post, and aviation. The first two agreements covered railways and road transport on digitization, safety, and training, though limited to studies and technical frameworks; the third covered bilateral air transport based on the open-skies principle; and the fourth covered postal cooperation.

In finance, the Central Bank of Syria and the Saudi–Syrian Business Council agreed the same day to establish a joint Syrian–Saudi bank and to open direct correspondent channels, with Governor Safwat Raslan framing the objective around transfers tied to investment in tourism and real estate. Yet, no capital, ownership structure, or licensing timetable was announced.

August 27 got busier as Syrian–Saudi collaboration carried into the water sector, when the Syrian Ministry of Energy signed a technical services agreement with ACWA Power, Saudi Arabia’s Water Transmission Company (WTCO), and German consultancy Fichtner to prepare studies for desalination capacity of 1.2 million cubic meters per day and a water transmission network of some 400 kilometers. This development represents the study phase of the joint development agreement concluded in February.

Finally, President Ahmed al-Sharaa received Saudi–Syrian Business Council chairman Mohammed Abu Nayyan at the People’s Palace, accompanied by Economy Minister Nidal al-Shaar, for a week in which the 63rd Damascus International Fair converted much of the pipeline into signatures. Agriculture Minister Basil al-Suwaidan signed a memorandum of regulatory harmonization and cooperation with the Saudi Ministry of Environment, Water and Agriculture on August 28, followed by three separate memoranda with Saudi companies Khair Alhgeyad, Mazarina, and Manoura, covering fodder land, sheep export infrastructure, and fisheries and aquaculture, and a poultry sector memorandum with the Al-Sahli Group on August 29. Still at the International Fair, the Ministry of Economy and Industry signed a 30-year memorandum with Ithra Holding for the Hama iron and steel works: five years of rehabilitation followed by twenty-five years of operation, minimum output of 350,000 tonnes annually within four years, and an estimated 2,500 jobs. No project value was disclosed.

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Why It Matters: Compared with February 2026, the more than twenty agreements and other instruments signed in August across agriculture, transport, energy, communications, the economy, and banking seem to provide a more meaningful sign of institutional engagement than the single headline investment package. Given that most large projects to have materialized in Syria since December 2024 have been state-backed and politically driven, the succession of high-level Saudi delegations visiting Damascus and meeting their Syrian counterparts gives the recent developments some teeth. Still, most, if not all, of the agreements took the form of memoranda of understanding, which, since December 2024, have proven notoriously difficult to convert into binding agreements, let alone implemented projects. Most also remain unpriced: only one of the month’s instruments carried a stated contract value, and one other a reported valuation.

Another catch is that most of what actually changed in August did not require Riyadh to put up capital. Driver visas, open skies, and postal cooperation are administrative measures, but they immediately affect how Syrian businesses operate. In that sense, Riyadh’s modus operandi is closer to what the French government proposed to Syria more than a month ago. By contrast, most instruments involving significant capital remain at the feasibility-study, technical-agreement, or development-plan stage. Even the solar projects signed at the start of the month will not add generation capacity overnight. The difference between what changed immediately and what may eventually be built is probably the most important thing to keep in mind when reading August’s announcements.

The picture becomes clearer when viewed alongside Türkiye’s growing economic role in Syria. Ankara is increasingly present in industry, energy, and cross-border trade, while Riyadh is positioning itself around finance, logistics, water, and real estate. The two are therefore not necessarily competing for the same space, at least for now, and Damascus benefits from having both. That division of labor has yet to be tested by a case where the two countries’ interests collide over a major asset.

Whether the partner is Saudi Arabia, Türkiye, or another, the harder question is how any of this gets financed. The Damascus–Palmyra–Deir ez-Zor road is a state procurement, yet no funding source was disclosed for a USD 300 million contract. Sham View presents the opposite model, explicitly financed through investor capital with payments linked to construction progress. Still, reporting on comparable projects suggests much of that capital ultimately comes from advance payments by Syrian buyers rather than fresh foreign money. On that reading, the Saudi contribution is primarily a development model and a brand, not a direct capital transfer.

That makes the proposed joint bank more consequential than its modest billing suggests. Syria’s ability to move money through the international banking system remains a constraint on almost everything else, and its FATF grey-listing adds a further layer of friction. An agreement to establish a Syrian–Saudi bank and open direct correspondent channels is still only a statement of intent, but it is a statement of intent about the one thing that would determine whether the rest of August’s paperwork moves money at all.

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Key Developments: On August 4, the Syrian Petroleum Company (SPC) announced it had assumed control of all oil fields in the Northeast, with SPC Director Youssef Qiblawi saying rehabilitation would begin immediately and take six months to a year. Qiblawi said the fields were producing more than 100,000 barrels of oil per day (bopd), with output expected to exceed 250,000 bopd by 2027. The handover implements the third clause of the January integration agreement between Damascus and the SDF, according to Qiblawi, which stipulated that the government take control of all border crossings and oil and gas fields in the region. Reporting in late August indicated that the transfer of all remaining fields and wells in Hasakah would be completed on September 10, following Mazloum Abdi’s August 25, 2026 announcement of the SDF’s dissolution.

The handover was accompanied by HKN Energy’s entry into Rmeilan, Syria’s largest field complex, which holds more than 1,300 wells and produced between 180,000 and 200,000 bopd before 2011, roughly half of national output, according to Qiblawi. It was reported that the state’s share of the project would be 70% versus 30% for the American company, and that Hasakah governorate would receive a share of revenues. Other reporting on the same agreement described a 25-year term with a phased revenue split, giving the government 60% during the first five years, 65% in a second phase, and 70% for the remainder of the contract. The agreement also includes salary increases for field employees and expanded environmental services for residents of the governorate.

More broadly, the Ministry of Energy reported that in H1 2026 it signed seven memoranda of understanding and three development contracts, completed 3,460 meters of drilling, repaired 21 wells, brought 152 wells into operation, and brought 10 new wells into service. It also reported rehabilitating five kilometers of the Conoco gas line and restarting the main pumping unit in Homs after a twelve-year stoppage.

In parallel, the SPC announced the complete removal of primitive refineries, known as harraqat (حراقات), from Deir Ezzor governorate. SPC Executive Support Director Majed Habib subsequently detailed the scale of the campaign: more than 1,660 units dismantled by company teams across Deir Ezzor and Hasakah, including over 1,200 in the al-Omar sector, around 400 in the Dijla sector and along the Jabsah line, and around 60 in the Shaddadi sector, with owners removing a further 300 themselves, bringing the total to approximately 2,000. Habib said individual units ranged from around 10 to around 400 barrels of capacity, that the file was complete in Deir Ezzor but ongoing in Raqqa, Hasakah, and rural Aleppo, and that the company had absorbed some former operators into formal employment, assisted owners in relocating equipment, and compensated eligible cases under an approved mechanism.

Against these consolidation measures, the Central Authority for Control and Inspection (CACI) disclosed findings of an investigation spanning May to August 2026 into a fraud at Deir Ezzor’s oil fields amounting to USD 28 million. The Authority reported preliminary damages of more than USD 8 million from contracting, maintenance work, and mismanagement, plus a further USD 20 million in price differentials on crude transport contracts between the Central Region administration and haulage companies. Following the three months of monitoring involving 22 inspectors, the Authority suspended nine officials and referred them to the judiciary, among them the director of Deir Ezzor fields, the director of oil transport and distribution for the Central Region, the transport supervisor, and several production and well-services officials at the al-Omar, al-Teim, and al-Tanak fields. It also directed the termination of contracts with non-compliant contractors and recommended precautionary seizure of the assets of those implicated. The specific findings included the absence of genuine tanker sealing at field loading yards, with loads estimated arbitrarily; maintenance contracts held for months by technically unqualified companies without objection from any technical or administrative committee; and producing wells left shut in without any party reporting or restarting them.

Separate investigations into six contracts dating from the Assad era concluded for the Baniyas refinery company between 2021 and 2024 identified violations worth old SYP 3.396 billion, of which old SYP 1.1378 billion consisted of price differentials granted to a contractor because of rising industrial diesel prices. Energy Minister Mohammad al-Bashir directed that oversight work continue until completion with results disclosed progressively, and said further files remained under review.

Ministry of Energy data for the first half of 2026 put crude production at 14.8 million barrels, refined products at 3.5 million tons, raw natural gas at 1.42 billion cubic meters, and clean gas at 1.25 billion cubic meters. Over the same period, the ministry recorded imports of 1.5 million tons of crude, 1.01 billion cubic meters of gas, 598,000 tons of diesel, 283,000 tons of petrol, 196,000 tons of LPG, and 32,000 tons of fuel oil, alongside 110 tankers received at oil terminals.

Against this backdrop, queues nevertheless returned to filling stations in Damascus and its countryside from August 11, which SADCOP attributed to an emergency technical fault in the petrol transfer pump on the Baniyas–Homs line, saying it activated an alternative supply plan by road tanker and discharged around 73,000 cubic meters of petroleum products over two days. Minister of Energy Mohammad Al-Bashir formed an inspection committee to determine why petrol was scarce in the capital despite being available in depots, requiring it to report within 48 hours. SPC Media Director Mohammad Nour al-Ahdab subsequently attributed the crisis to a halt in petrol production at the Homs refinery, the concentration of loading operations at the Baniyas depot, and higher demand, acknowledging that the supply system was operating with a limited safety margin and that reserve stocks required strengthening. He later denied reports of widespread substandard petrol at official stations, attributing quality complaints to mixing and to smuggled material circulating outside formal distribution channels.

Further highlighting the hydrocarbons sector’s fragility, on August 18, an explosion struck the main export pipeline from the Jabsah gas plant in Hasakah at around 4 AM, halting gas flow and disrupting supply to several power generation turbines; SPC said preliminary investigations pointed to deliberate sabotage and announced additional security measures around oil and gas facilities and transmission lines. The same day, three workers were killed by a hydrogen tank explosion during component replacement at the Baniyas thermal power plant.

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Why It Matters: August’s shortage echoes those reported in July, albeit for different reasons, and remains substantively different. Yet the result is the same, and public discontent is stark across the country. While July’s queues followed a pricing decision taken without a mechanism to compensate stations holding higher-cost inventory and thus represented a coordination failure, August’s followed a mechanical fault and a refinery outage and were a redundancy failure. The SPC’s own characterization of a limited safety margin is the more useful admission: with the Baniyas refinery under rehabilitation, loading concentrated at a single depot, and reserve stocks acknowledged as insufficient, the system has no absorptive capacity. The Jabsah sabotage makes the same point on the gas side, where a single line failure propagated directly into power generation. Investment announcements are accumulating faster than the buffers that would make the existing system tolerable to live with.

The harraqat file closes a thread this digest has followed since May. The state’s case was always sound on environmental, fiscal, and safety grounds, and removing roughly 2,000 units is a genuine administrative achievement in itself. But the distributive question remains open in the same form. SPC has described absorption into formal employment, equipment relocation, and compensation for eligible cases, without publishing the number of workers absorbed, the terms offered, or the value disbursed, which represent precisely the gaps that workers identified in Aleppo and Deir Ezzor earlier in the year. In parallel, the unresolved case of the dismissed Furat Petroleum employees, who appealed to the Energy Minister in early August after interviews held in May produced no decision, suggests that the Ministry’s capacity to absorb additional staff might be limited, or at least slower than its capacity to remove, close down, and dismiss. Given the many grievances piling up in Northeast Syria, this Ministry too will have to be careful about sequencing: informal refining is being eliminated in the same governorates where the population seems to be struggling the most and where the government cannot afford to be contested.

Still, as the integration process seems to be moving forward with few struggles, at the political level at least, Damascus managed to consolidate the oil sector on four fronts. The remaining fields outside government control were transferred to SPC, while the terms for operating the largest of them over the next 25 years were agreed. In Deir Ezzor, the parallel refining economy ended, and the state began prosecuting officials within its own oil bureaucracy. Taken together, these moves mark a significant shift in how the sector is controlled, addressing gaps that have remained since 2012. They also leave Damascus with fewer intermediaries to point to when problems arise. From September, more of the responsibility for what the sector produces, collects, and ultimately delivers to petrol stations in Damascus will rest directly with the state.

Finally, the corruption findings may appear less consequential than they are, as they raise questions about the state’s ability to manage its new oil contracts. The CACI identified failures in the basic functions that determine whether a revenue-sharing agreement can actually be enforced: metering, calibration, tanker sealing, load verification, contractor qualification, and monitoring of well productivity. A state that cannot verify how much crude leaves a loading yard cannot verify the basis on which its 60% or 70% share is calculated.

This is the practical side of the argument made in previous editions that contract design matter more than the identity of the investor. But, given this latest development, the question is no longer just how the contracts are designed; it is whether the state has the administrative capacity to enforce them. The sequencing is therefore unfavorable: the contracts were signed first, and these control weaknesses were documented afterward. That an external body uncovered the violations during a single field visit, rather than SPC’s own internal controls, should concern both counterparties and the Ministry of Finance—particularly given that oil and gas revenues only began flowing to the Treasury in May.

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Key Developments: On August 31, the Ministry of Finance published a “citizen’s version” of its financial performance report covering the execution of the 2026 state budget from January 1 to June 30. Public revenue reached approximately USD 2.695 billion over the six months, equivalent to 31% of the USD 8.716 billion projected in the 2026 budget and a monthly average of around USD 449 million, while public expenditure reached approximately USD 3.7 billion, or 35% of approved appropriations, producing a fiscal deficit of about USD 1.005 billion. Against the first half of 2025, revenue rose by 111% and expenditure by 331%; the comparable half-year in 2025 showed revenue of USD 1.28 billion, expenditure of USD 858 million, and a surplus of USD 422 million.

Finance Minister Mohammad Yisr Barnieh described the report as the third installment in a disclosure series that began with the 2025 performance report and the 2026 Citizens Budget, and as a shift from publishing approved appropriations toward periodic reporting of actual execution.

On the revenue side, the report breaks the total into USD 1.079 billion in customs duties (40% of the half-year total, and 56% of the annual estimate for that line), USD 763 million in returns on state investments (28%; 41%), USD 601 million in oil and gas revenue (22%; 25%), and USD 252 million in taxes and fees (9%; 10%). Expenditure was distributed between USD 1.339 billion in wages, salaries, compensation and benefits (36% of the half-year total, 37% of the annual allocation), USD 1.025 billion in administrative spending (28%; 65%), USD 1.021 billion in investment spending (28%; 35%), and USD 315 million in subsidies and social security (9%; 13%).

The ministry attributed the expenditure increase mainly to the salary and wage rises applied from May, expanded spending on government priorities, and higher costs for imported goods, services and inputs driven by regional developments. It noted that oil and gas revenue only began being transferred to the ministry in May and that proceeds from the second mobile operator license were not collected during the period, meaning the half-year results reflect only part of expected annual revenue. The report states the deficit was managed through short-term investment financing repayable within a year, but did not mention the source of this financing.

In contrast (and perhaps in response) to low tax revenue collection, revenue administration and enforcement were a focus in August.

On August 17, Barnieh warned chambers of commerce and industry that repeated cases of under-valued invoices in customs declarations had reduced collection of the tax advance on imports, describing the practice as tax evasion subject to penalties unless corrected voluntarily. The minister suspended 34 employees on August 6, 24 in the finance directorates of Damascus, Hama and Aleppo and 10 at the Real Estate Bank, following 94 suspensions in May; the Central Bureau for Financial Control identified a 2021 Real Estate Bank contract carrying a financial impact of USD 8.454 million, and separately uncovered an embezzlement scheme involving real estate sales tax receipts at the Kiswah finance directorate. A national campaign to review state property investment contracts, run by the illicit enrichment committee with the Ministry of Finance, was launched on August 2.

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What It Matters: Barnieh presented the half-year result as a deficit “within target,” at 56% of the budgeted USD 1.8 billion. That sits awkwardly beside his own revision of full-year revenue to “close to USD 8 billion,” a downgrade of roughly USD 716 million against the April budget. If revenue lands there and appropriations execute in full, the deficit is closer to USD 2.5 billion, around 40% above target and equivalent to some 12.5% of an estimated GDP of USD 20 billion.

Such a ratio is unstable, since the denominator (the budget) is contested: the budget itself assumes GDP of around USD 33.7 billion, Barnieh has put 2025 output at USD 30.6 billion, and al-Sharaa has projected USD 50–60 billion for 2026. Still, and regardless of the ratio, a deficit overshoot of this order means finding some USD 700 million beyond what was budgeted, in a context where the sovereign sukuk framework has yet to produce a first issuance, and no domestic securities market exists to absorb one. The ministry’s warning that spending will accelerate as the wage increase reaches full effect may also mean cuts to development and investment expenditure.

On revenues, customs alone delivered 40% of half-year receipts, while taxes and fees delivered 9%, with the tax line executing at 10% of its annual allocation—by far the weakest performance of any category—against a budget that assumed taxes, fees and customs would jointly supply about half of revenue.

Looking at the structure of revenues, Syria remains fiscally a “border state” rather than a tax state, collecting where goods cross a frontier rather than where income and consumption are generated. That is not surprising given how weak tax enforcement has historically been. But this also reflects the new authorities’ institutional history: governing a large territory with limited administrative reach made customs the most practicable revenue source, and that lesson appears to have carried over. The General Authority for Land and Sea Ports was among the first bodies established after the collapse of the Assad regime, which says something about where the priority sat from the outset.

The reliance on customs revenue ties the budget to import volumes, which depend on an exchange rate and a trade regime the government is actively liberalizing; it is inflationary at the point of collection, since duties and the tax advance on imports pass into consumer prices; and it is regressive relative to a functioning income tax. Based on The Syria Dispatch’s review of the new tariff schedule, because most current duties are specific rather than ad valorem, assessed on the weight of goods, inflation quickly erodes their real value—and the government is left better off with more imports for more revenue, which undermines local industry and production it needs to protect. The August circular on under-valued declarations is a rational response to immediate leakage, but it is border enforcement standing in for a domestic tax base, and the reform meant to build that base is not expected to take effect before 2027.

Execution rates tell a similar story on the spending side: administrative spending ran at 65% of its annual allocation in six months, while subsidies and social security ran at 13%, so the fastest-disbursing category is the cost of running the state apparatus and the slowest is the one that reaches households directly. That is awkward given that August 2026 also produced reports that nine in ten Syrians remain in poverty and continued contraction of humanitarian food assistance amid funding shortfalls.

Finally, despite the overall transparency, the financing disclosure is the report’s clearest gap: the deficit was covered by short-term investment financing repaid within a year, with no instrument, counterparty, cost, or maturity given. The sukuk and treasury securities framework was still at the draft-strategy stage in mid-July, as covered in last month’s edition, so whatever financed the first-half gap was not that. A government that has genuinely stopped borrowing from the Central Bank—a real and underrated break with the pre-2024 model—has a strong story to tell about how it is financing itself instead, and not telling it invites the assumption that the answer is less clean than the alternative.

That said, the disclosure deserves credit on its own terms: a mid-year execution report with a line-item breakdown, published within two months of the period closing, is not the regional norm, even if these are in-year figures from a twenty-one-slide summary rather than audited accounts. The year-on-year comparison is about as flattering as it could be, given that the first half of 2025 ran on a one-twelfth budget based on appropriations inherited from the former government, so the 331% expenditure increase measures a state resuming normal fiscal operation across reunified territory at least as much as a decision to spend more.

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Key Developments: The Central Bank of Syria (CBS) began withdrawing the old Syrian pound on July 31, after the replacement deadline expired on July 30. In its August 2 statement, the CBS confirmed that old banknotes of all denominations had lost their legal-tender status (al-quwwa al-ibra’iyya, القوة الإبرائية), were no longer legally valid in financial transactions, and could not be used to settle obligations or discharge payments in any form. The CBS put the overall replacement rate above 95% of the monetary mass on preliminary estimates, up from the roughly 80% reported in July, while CBS Governor Mohammad Safwat Raslan separately cited a figure above 90%.

Citing that completion rate, the CBS granted an exceptional one-week window running from Sunday, August 2 to Thursday, August 6, during which holders could surrender old notes and receive their value in the new currency through all public and private banks and Syrian Post branches in every governorate, free of commissions, fees, taxes or other charges. After that window, withdrawals were to continue for five years exclusively through the CBS’ Damascus headquarters, using an online appointment-booking mechanism. To manage demand in the northeast, the CBS announced on August 3 the extension of operating hours at 20 Syrian Post outlets across Raqqa, Hasakah and Deir Ezzor to 8:30 AM–7:30 PM through August 6, and waived both prior online registration and the requirement to present 100 notes of a given denomination for the duration of the window. Two days later, on August 5, the CBS announced that the exchange process in the northeastern governorates would be extended until August 20.

On August 9, the CBS again reversed course, allowing withdrawals to continue through authorized Syrian Post outlets in all governorates for a period of five years, so that citizens need not travel to Damascus, and that it was coordinating with the Syrian Post to increase the number of counters. That decision effectively canceled the earlier restriction on direct exchanges, limited to the eastern governorates, until August 20. On August 14, it opened an electronic application channel under which the counter-value is credited to a bank account nominated by the applicant, with eligibility restricted to Syrian natural persons and one application permitted per holder.

Amid these decisions, confusion over the currency exchange process was felt unevenly, with the Northeast, still in the process of political, security, and economic integration, seemingly bearing the brunt. Reports in early August said delays in opening exchange centers in Raqqa and Hasakah caused near-paralysis in buying and selling, and that many residents disposed of their old-currency savings by selling them for dollars at rates reaching SYP 17,000 old (SYP 170 new) to the dollar, well above the prevailing rate of around SYP 130 to 132 per USD. Reporting from Qamishli in late August, Alexander McKeever told The Syria Dispatch that the old currency remained the dominant medium of exchange in the city despite having lost its legal-tender status, with most purchases settled in old notes and change returned in them (Visit Alexander’s publication: This Week in Northern Syria).

Reports also documented a parallel market in Damascus in which the standard offer was SYP 750 new for every SYP 100,000 old (instead of SYP 75,000), with intermediaries trading banknotes as an actual commodity and targeting the elderly, the low-income, and those unable to reach official centers before the deadline.

Internal security forces in Raqqa detained three money changers on August 4 for exploiting citizens and manipulating exchange rates in old-currency transactions. Still, such operations do not seem to be strong enough deterrents to prevent abuses.

In Hasakah, rumors in mid-August that August 18 was the final date for accepting old notes triggered renewed panic, prompting the CBS’ media department to restate that the end of legal-tender status did not extinguish the right to exchange; residents described petrol stations, phone dealers and wholesalers refusing old notes or demanding payment in dollars, and queues at centers that ran out of new banknotes. Governor Raslan responded to the Hasakah dispute in a Facebook comment, questioning the extent to which the bank was responsible for “refining people’s morals” and attributing part of the disruption to profiteering.

Adding to the confusion and the quick succession of decisions, shortages of small denominations, especially the CBS decision not to print a SYP 5 note, despite printing a SYP 25 note, compounded problems related to the new currency. For instance, reporting from the coast documented grocers substituting an egg or a piece of confectionery for change of SYP 10 or 25 new, and pharmacists offering paracetamol sachets or plasters in place of small balances, with one public employee reporting he had yet to handle a SYP 25 new note. The Syria Dispatch observed the same pattern firsthand in Damascus during the first two weeks of August, with SYP 5 change either withheld altogether or returned as a single falafel or apple, or in old SYP 500 notes, nominally equivalent to SYP 5 new but no longer legal tender.

The lack of small denomination also led internal transport drivers in Raqqa striking on August 10 and gathering outside the governorate building over the same shortage: fares are set at SYP 30 new (SYP 3,000 old) while passengers tender 20 or 25, and drivers described returning biscuits, chewing gum and lighters in lieu of change, demanding either a fare increase to SYP 50 new (SYP 5,000 old) or subsidised diesel allowing them to hold the fare at SYP 20 new (SYP 2,000 old). The transition also remains incomplete in the unit of account, even with state institutions and large companies such as the General Telecommunications Company and Zain (formerly MTN) still issuing bills denominated in old lira, and the old SYP 500 note still circulating in transport and markets.

The liquidity squeeze caused by a lack of new currency in the market migrated into the digital payments layer and money exchange companies. Complaints in Aleppo surfaced on August 7 that exchange offices would settle Sham Cash balances only in dollars, and that intermediaries were charging between SYP 150 and 180 for every SYP 10,000 new withdrawn. A withdrawal ceiling of SYP 14,400 new on August 11 at one Al-Fouad branch, which was also settling dollars at SYP 119 new, was also recorded. Later reporting found that numerous Damascus exchange companies had suspended the service entirely, citing a failure in the electronic link with the CBS, while sources attributed the suspension to the bank halting cash withdrawals by those companies beyond limited quantities.

Sham Cash responded by launching an online complaints channel and reaffirming a maximum withdrawal commission of three per thousand (0.3%). Marketing director Mohammad Basiki subsequently set out a ceiling of three per thousand on withdrawals and two per thousand on deposits, down from five per thousand before the new currency, noting that the company retains none of the commission, that 29 authorized companies provide the service, and that the regulation of exchange offices falls to other authorities. By August 20, public-sector employees could not convert salaries into cash at any office, and an informal market emerged in which brokers discounted balances by as much as 15% for cash. Basiki denied any platform-wide ceiling, while an exchange-sector source attributed the rationing to CBS liquidity management and to the volume of old currency withdrawn exceeding the volume of new currency injected.

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Why It Matters: Both risks that materialized in August, the convoluted post-July 31 procedure and the liquidity crisis, were flagged in advance. On August 3, one expert warned that confining exchange to Damascus would open a parallel market in old notes, with holders unable to travel selling below face value to intermediaries who would capture the spread, while another argued that the five-year horizon was generous but that outcomes depended on banking-sector liquidity and the easing of withdrawal restrictions; a third attributed the change shortage to the concentration of issuance in higher denominations. The many decisions and reversals in the first two weeks of the month are both confirmation that the mechanism was designed without its distributional consequences worked through and a sign of responsiveness, and they eased access to the service while leaving the conditions attached to it untouched; no remedy has been announced for the denominations at all.

As for the liquidity crisis itself, one economist calculated that an economy of USD 18–19 billion settling some 85% of payments in cash needs a working stock of SYP 400–430 billion new, against which he put immediately usable cash at SYP 300–340 billion new (USD 2.5–2.8 billion)—a gap sized at 20–28% of the economy’s cash requirement, stalling roughly SYP 4 billion new (USD 33 million) of transactions a day and concentrated geographically enough to open an 8.5% spread between the dollar rate in eastern exchange shops and the rest of the country.

That number describes a failure which has now materialized through every layer of the financial and transaction chains, with banks rationing withdrawals and exchange and transfer companies, which hold the country’s largest private cash inventories and exist to convert balances into notes, suspending the service outright in Damascus. The most telling adaptation is that some offices in Aleppo would pay only in dollars. Faced with a shortage of one currency, the SYP, the market substituted another, the USD. As a result, the redenomination process, initially intended to restore confidence in the national currency, has, in its execution, made a foreign one the more reliable medium of exchange in parts of the country.

Far from a mere technicality, this incidence is also regressive at every stage. For instance, the Agricultural Cooperative Bank’s decision to route 25% of wheat farmers’ net dues through Sham Cash came precisely because the CBS lacked the cash to pay in full. Public employees and now farmers—people paid in fixed sums they must convert entirely into cash to live on, especially since digital payments scarcely exist in Syria—absorb a levy of up to 15% to access their own money, while anyone holding dollars or bank deposits they need not draw down pays nothing. This is a transfer from the poorest cash-dependent households to whoever holds banknotes, and it is invisible in every official statistic.

Still, the bigger question the month, and those prior, in fact, leaves unanswered is why the CBS is short of cash at all. The bank has not published a figure for new currency in circulation, and the possibilities are not equally benign: a printing or distribution bottleneck is a logistical problem that will resolve, while a deliberate decision to hold the money supply tight in order to force adoption of electronic payment is a policy choice being made without being announced.

The August 22 adoption of a licensing and supervision framework for payment service providers and e-money issuers, and the floating of semi-monthly salary payments to spread cash demand, both point toward the second. Still, lack of liquidity could also be a way for the CBS to stabilize the exchange by constraining money in circulation, but this is not an ideal policy decision (READ: Currency Replacement Ends as Syria Builds New Monetary Policy Tools). Back to digitization, this remains a defensible objective, and Syria will need it. But adoption compelled by the unavailability of cash is not the same as adoption earned by a payment system people trust, and people who did not choose it are now paying the bill in 15% increments.

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Continue Reading the August 2026 Syria Monthly Economic Digest

Explore Previous Editions

Browse every edition of the Syria Monthly Economic Digest, featuring monthly analysis of Syria’s political economy, governance, reconstruction, and regional developments.

→ Browse all editions

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Receive the Syria Monthly Economic Digest, along with original research, expert interviews, and in-depth analysis on Syria’s political economy, governance, and reconstruction—delivered directly to your inbox.