In Damascus on Jan 31, Syria's new Islamist leaders are initiating significant changes to the country's struggling economy. Their plans include dismissing a third of public sector employees and privatizing state-run companies that have long been key under Assad family rule. Following the rebels' overthrow of Assad on Dec. 8, layoffs have already begun, resulting in protests from government workers concerned about potential job cuts based on sectarian lines.
According to five ministers from the interim government formed by the Islamist Hayat Tahrir al-Sham (HTS) group, the reforms involve targeting inefficiencies, such as eliminating "ghost employees" who received pay without making significant contributions during the Assad era. The aim is to transition Syria to a more competitive free-market economy, as stated by Syria's new economy minister, Basil Abdel Hanan.
The government, led by Ahmed al-Sharaa, plans to privatize the majority of 107 state-run industrial companies, with a commitment to keeping strategic energy and transport assets under public control. Finance Minister Mohammad Abazeed highlighted the existence of state companies solely used for embezzlement, expressing shock at the extent of corruption discovered.
Moreover, reforms aim to simplify the tax system and encourage investments for economic recovery, with a focus on attracting investors back to the country. Despite facing challenges, the new government anticipates an increase in foreign and domestic investment to create jobs and rebuild Syria post-conflict.
The government also aims to balance rapid market reforms by providing support for vulnerable populations to avoid economic instability. Measures include addressing low salaries, providing severance for those laid off, and assessing job roles to determine workforce efficiency.
Nevertheless, the pace and scale of reforms have sparked concerns among critics, who question the government's legitimacy and ability to manage the transition effectively. The administration is planning elections, expected to take up to four years to organize, to establish lasting governance.
While challenges lie ahead, the government is committed to navigating the economic changes cautiously to prevent chaos and ensure stability. Plans include digitalizing employee records and streamlining administrative processes, acknowledging the complexity of restructuring the public sector while managing the country's transition.