Sharaa’s Gulf Tour Is All About the Economy

Syrian President Ahmad al-Sharaa visited three Gulf states — Saudi Arabia, Qatar, and the United Arab Emirates — over two days beginning on April 21. The Syrian presidency described the trip in broad terms as “focused on strengthening bilateral relations and discussing issues of mutual interest.” The whirlwind diplomacy is likely centered on economics as Damascus grapples with mounting economic pressure.

The Gulf states pledged billions of dollars in investments following President Donald Trump’s decision to lift sanctions on Syria. Yet many of these development projects remain unimplemented, largely due to lingering restrictions on Syria — chief among them its continued designation by the United States as a State Sponsor of Terrorism (SST), a label in place since 1979. The situation is further complicated by the composition of Syria’s security apparatus, which includes foreign jihadists with ties to terror organizations. Against this backdrop, one likely objective of Sharaa’s visit was to secure the durability of Gulf commitments, particularly as regional economies come under strain from Iranian attacks on their energy and economic infrastructure.

Despite Sanctions Relief, Syria’s Economic Recovery Has Stalled

Trump’s decision to “give Syria a chance to rebuild and thrive,” coupled with his successive rollback of sanctions — most notably the Caesar Act, which imposed secondary sanctions on the regime of the ousted dictator Bashar al-Assad — initially fueled optimism about a surge in financial flows into the war-torn country, where reconstruction needs are estimated at roughly $216 billion. In the wake of this relief, Gulf states announced major investment pledges, led by Saudi Arabia and Qatar with packages worth $11.7 billion and $11 billion, respectively.

Yet these commitments remain largely notional since these states cannot commit to Syria now because of the SST designation, leaving meaningful economic recovery stalled. Syrian Finance Minister Yisr Barnieh has said that the SST designation is the country’s “last milestone” to unlocking foreign investment.

According to the Syrian Center for Policy Research, Syria’s real gross domestic product (GDP) in 2025 recorded only marginal growth of about 0.3 percent compared to 2024, while real GDP per capita declined by about 6 percent. The same source reported that the year-on-year inflation rate reached 11.4 percent in November 2025 compared to November 2024. Rising prices have also begun to trigger public frustration. On April 17, a small demonstration took place in Damascus, highlighting worsening social and economic conditions and calling for greater transparency regarding the country’s economic situation. Earlier in the year, protesters demonstrated outside the Ministry of Electricity. One protester said, “My bill used to range between “15,000 and 20,000 Syrian pounds” — equivalent to less than $2 — but now it exceeds 800,000” — equivalent to $72.

Syria Aspires To Be an Alternative Energy and Trade Corridor

U.S. Ambassador to Turkey and special envoy Thomas Barrack has floated the idea that overland routes through Syria could help offset disruption caused by Iran’s closure of the Strait of Hormuz. Sharaa mirrored these remarks, saying, “Syria can serve as a secure overland and maritime route, ensuring regional oil reaches European markets quickly and safely.” During the war, Iraq began exporting crude oil by tanker trucks transiting through Syria to the Port of Baniyas on Syria’s Mediterranean coast.

Yet Syria’s security environment remains fragile, with frequent outbreaks of violence across the country. Cells linked to the Islamic State have targeted tanker trucks moving through the Syrian desert and central regions. With the ISIS threat far from diminished, the likelihood of such attacks remains high. As a result, persistent instability continues to undermine Syria’s reliability as a transit corridor, limiting its viability as a long-term alternative.

Washington Should Leverage Designation To Press for Tangible Progress

The United States has said it will review Syria’s SST status in December 2025.

Washington should use that leverage to extract concrete concessions from Damascus on issues central to U.S. national security, chief among them the presence of foreign jihadist elements within the Syrian military. These include units such as the 84th Division, reportedly composed in part of fighters from the Turkistan Islamic Party, which maintains ties to al-Qaeda and whose leadership has been linked to al-Qaeda’s Shura Council.

Ahmad Sharawi is a senior research analyst at the Foundation for Defense of Democracies (FDD). For more analysis from Ahmad and FDD, please subscribe HERE. Follow FDD on X @FDD. Follow Ahmad on X @AhmadA_Sharawi. FDD is a Washington, DC-based, nonpartisan research institute focusing on national security and foreign policy.