Major US Sanctions are a major barrier to reconstruction in Syria. With violence erupting on the country’s coast, US policymakers remain skeptical of lifting sanctions on the new government, which desperately needs investment to avoid economic collapse.
Amid five days of violence, one question is on the minds of Syrians across the country, from average citizens returning to war-torn homes to business owners: when will the US lift sanctions?
As it struggled to contain spiraling sectarian violence and an Assadist insurgency in Syria’s Western coastal regions in early March, the interim Syrian government is also confronting a quietly mounting but serious economic crisis as investment remains blocked.
The two are intrinsically linked.
One of the clearest impacts of American sanctions is Syria’s energy sector, where one-third of electricity stations are completely destroyed and another one-third are in need of repairs and foreign-made parts.
Three months after the hardline Islamist Hayat Tahrir al-Sham (HTS) deposed dictator Bashar Al Assad, the far-reaching 2020 Caesar Act, which imposed sanctions to pressure Assad to stop his regime’s industrial killing of civilians and reach a political resolution to the country’s civil war, are still in place.
Despite a waiver issued by the Biden Administration in January on humanitarian aid, the vast majority of the sanctions are in place until 2029.
The sanctions continue to impact the daily life of Syrians, from cash availability to available medicines to clearing landmines.
Although in the last month, the EU, UK, and Canada suspended sanctions on key sectors from banking to energy, the ongoing presence of US sanctions continues to prevent companies and individuals—American and non-American—from dealing with Syria and its banking system.
It leaves much of the country isolated from the global economy.
Several factories in the Damascus Industrial City are empty and unable to start production as foreign importers balk at paying cash through intermediaries in third-party countries, unable to wire to Syrian bank accounts.
One of the clearest impacts of American sanctions is Syria’s energy sector, where one-third of electricity stations are completely destroyed and another one-third are in need of repairs and foreign-made parts.
The majority of electricity generation plants in Syria were built by European companies; as of early March, European companies were unable or unwilling to provide spare parts and pumps—forcing Syrian authorities to use handmade local parts as stopgaps.
Currently, Syria is producing 2-3 hours of electricity per day in most of the country, forcing the bulk of citizens to purchase fuel to run private generators—or to live without electricity.
Syria’s state-run Electricity Generation and Transmission Company estimates that lifting US sanctions would shorten its projected timeframe to produce 24-hour electricity nationwide from five to seven years to three years.
The delay in rebuilding homes is compounding a housing crisis; with the limited housing units available, rent is pushing past $500-$700 per month in Damascus, in a country where the vast majority rely on cash assistance from relatives abroad and the averages salary is $25-$40 per month.
Sanctions under the Ceasar Act even have a nuts-and-bolts impact rebuilding the country. Arab Gulf states, unable to receive money wire receipts and struggling to navigate Caeser exceptions, have held back from investing in Syria and its reconstruction.
Caesar restricts the export of heavy machinery to Syria, such as specialized cranes and bulldozers needed to clear rubble and support collapsing residential towers. A handful of heavy machinery dates back to the turn of the 21st century, but the bulk of bulldozers and cranes in Syria date back to the 1970s and are badly in need of repairs.
Caesar sanctions also continue to impact Syrians’ ability to access global digital services, such as data clouds, GPS, and access to many websites and Apps—preventing Syrian surveyors from using GPS data points to map out the destruction and create a database on the status of individual buildings and neighborhoods.
According to UN estimates, 50% of structures in Syria’s infrastructure have been destroyed or rendered non-functional, and the Syrian Engineers Association estimates that 40% of buildings have been severely damaged or destroyed. With the lack of heavy machinery, limited electricity and high prices of raw materials, returnees in Dariya, Qaboun, Yarmouk Camp, and Homs use shovels and wheelbarrows to remove tons of debris from their damaged homes.
The delay in rebuilding homes is compounding a housing crisis; with the limited housing units available, rent is pushing past $500-$700 per month in Damascus, in a country where the vast majority rely on cash assistance from relatives abroad and the averages salary is $25-$40 per month. The emerging economic crisis and growing poverty in Syria quickly dissipated the hopeful, feel-good atmosphere in the initial weeks after Mr. Assad’s downfall.
A silent crisis is brewing.
According to a February UNDP socioeconomic impact assessment, nine out of ten Syrians live in poverty, while projections indicate the economy must grow six-fold in order to shorten its postwar recovery to 10 years—an impossible task with US sanctions in place.
This is placing greater pressure on the interim government, which has frozen or delayed the salaries of 1.3 million civil servants despite promises of hiking salaries by 400%, leading to protests in Damascus. Many Syrians are losing patience with the new rulers.
The United States has not yet articulated its conditions for lifting sanctions, nor has it expressed an interest, thus far, in directly engaging the HTS-led interim Syrian government. There is no US special envoy to Syria.
In contrast, the EU conditioned its suspension of some sanctions on the HTS-led interim government, acting in a manner consistent with human rights and democratic norms, intended to encourage a positive transition.
But any potential progress on US sanctions took a huge setback with early March’s Assadist insurgency and sectarian violence.
In what started as coordinated attacks by Assad regime remnants on interim government security personnel on March 6, according to the Syrian Human Rights Network, the five following days of bloodshed saw the extrajudicial killing of 803 citizens by Assadists and armed groups aligned with the interim Syrian government forces.
From March 6-10, Assadists killed 211 civilians and 172 members of the interim Syrian government security, police and military. Government-aligned forces, many of whom are armed groups that fall under the government’s umbrella but are not directly under HTS control, killed at least 420 civilians and unarmed fighters- including 49 women and 39 children, the Syrian Human Rights Network stated.
The bloodshed led Secretary of State Marco Rubio to issue a statement on X stressing that “the United States condemns the radical Islamist terrorists, including foreign jihadis, that murdered people in western Syria in recent days,” urging “Syria’s interim authorities must hold the perpetrators of these massacres against Syria’s minority communities accountable.”
There are some positive signs amid the bloodshed.
This week, Syrian interim government President Ahmed Al Sharaa formed two independent committees: one to maintain civil peace and another to investigate the coastal violence and hold perpetrators accountable. It came as Mr. Sharaa pled for “national unity” and vowed to protect all sects and groups equally and immediately refer violators to the law.
Crucially, two other events this week bode well for Syria’s future pluralism and inclusivity. On March 11, the interim Syrian government signed a deal with Mazloum Abdi, commander of the Syrian Defense Forces, to merge the Kurdish military and autonomous political authority in northeast Syria into the new Syrian government and army.
On March 13, a committee presented Mr. Sharaa with Syria’s constitutional declaration, which calls for an independent judiciary, a separation of powers, and a people’s assembly that enacts legislation and can recall the president.
The constitution, which outlines a 5-year transition period, enshrines several rights and freedoms, including the freedom of speech, media, and women’s right to education, political participation and participation in the workforce.
In order to prevent both an economic and security collapse, the interim Syrian government must salvage its reputation in Washington.
Secretary Rubio hailed the SDF-interim government agreement in a statement, stressing the US “reaffirms its support for a political transition that demonstrates credible, non-sectarian governance.”
“We will continue to watch the decisions made by the interim authorities, noting with concern the recent deadly violence against minorities,” he warned.
While the SDF and Druze integration deals and a new constitutional framework allegedly in the works are critical milestones—largely meeting the European conditions of pluralism and human rights—they alone cannot assuage American concerns over violence against minorities or salvage HTS’ reputation in Washington as a band of unruly jihadist fighters.
In an interview with Reuters on March 10, Mr. Sharaa linked the sanctions and the country’s stability:
"Syria has the task of establishing security after the chaos that has occurred and this is closely linked to building the economy, which cannot be done except with lifting sanctions,” Mr. Sharaa told Reuters.
"We cannot establish security in the country with sanctions still in place against us,” he said, noting that “the Syrian file is not on the US list of priorities.”
In order to prevent both an economic and security collapse, the interim Syrian government must salvage its reputation in Washington.
To gain any political traction on lifting US sanctions, it is clear that the interim Syrian government must take on a task that it so far has been hesitant to do: bring all perpetrators of violence—including its own fighters—to justice.
The views expressed in these articles are those of the author and do not reflect an official position of the Wilson Center.
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