Panorama econòmic

Economic indicators

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Syria has been plagued by a devastating war since 2011. According to a study published by the World Bank, the conflict caused a contraction of the GDP by more than 50% compared to 2010 (World Bank), and the humanitarian crisis has claimed more than 500,000 victims. Beyond the immediate impact of the conflict, the economy suffers from the compounding effects of the pandemic, adverse weather events, regional fragility, and macroeconomic instability. However, it is extremely difficult to assess the financial health of the country as the wartime GDP can be very unstable due to foreign aid and continued destruction. The return of several provinces under the control of the Bashar Al-Assad regime was expected to restore certain stability necessary for the start of reconstruction and economic recovery; however, the Lebanese crisis, the new sanctions imposed by the United States and the outbreak of COVID-19 further deteriorated the situation. After an estimated contraction of 2.6% in 2022 (to USD 15.5 billion in constant 2015 prices), real GDP is expected to contract further in 2023 (World Bank).

With the help of his Russian and Iranian allies, Bashar Al-Assad has regained control of most of the Syrian territory and considers himself victorious in an essentially ended war. But the country is in ruins, the destruction of the physical capital being estimated at around USD 120 billion, and the estimated loss in GDP at nearly 325 billion USD (UNESCWA). Overall, the estimates of reconstruction costs of Syria’s productive capacity range between USD 250 billion to 400 billion (Coface); nevertheless, the long-awaited reconstruction does not materialize. Businesses face energy and water shortages and are regularly shaken by liquidity constraints. International sanctions have practically frozen trade with the outside world and neighbouring partner countries (Iran, Lebanon) are facing economic and political difficulties. Impacted by the Lebanese crisis, tougher U.S. sanctions under the Caesar Act and the COVID-19 pandemic, Syria's economy deteriorated further since 2020. Given Syria’s heavy reliance on imports, currency falls quickly fed into higher domestic prices, causing high inflation: according to a report by the World Bank, annual inflation reached 90% in 2021, after hitting 114% in 2020. Meanwhile, government spending continued to be constrained by low revenues and the lack of access to financing. The current account of Syria is expected to remain firmly in deficit because of an extremely high trade deficit, contributing to the drain of foreign exchange reserves.

On the humanitarian level, the situation is catastrophic. About 6.2 million people have been internally displaced and 5.6 million are officially registered as refugees (World Bank). The social situation of the country was already serious before the crisis: a third of the population lived below the poverty line, unemployment affected 20% of the population (75% of the unemployed were aged 15 to 24) and the demographic growth rate was very high (3.3% per year). Since the start of the war, the situation has only gotten worse. The middle class has disappeared: according to UN estimates, more than 80% of the population now lives below the poverty line and half of the population is unemployed (CIA Factbook). Essential goods and services, including food, clothing, housing, and fuel, account for about three-fourths of the consumption basket, with food alone accounting for about 40% of consumption. According to the World Food Program, 12.4 million Syrian are now food insecure, almost 60% of the country’s population. Moreover, Syria’s working-age population has significantly shrunk, particularly in its male component; however, the impact of this demographic shock has been compensated by an increase in labour force participation, leaving the overall number of employed Syrians almost unchanged at around 5.2 million (World Bank). The number of women entering the labour market recorded a steep increase, almost doubling from 13% in 2010 to 26% in 2021. Syria’s human and physical capital has been severely affected by the conflict, whose structural implications are likely to affect the country’s future growth prospects.

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