Syria is discussing with Saudi Arabia the financing of projects worth approximately $1.5 billion in the coming months, while preparing to sign the first package worth $406 million in a few days. This coincides with Damascus' moves to resume funding from international institutions and attract investments to contribute to economic reconstruction after years of war.
Syrian Finance Minister Mohammed Yasser Baranieh said in an interview with colleague Noor Ammasha on the sidelines of the IMF and World Bank meetings in Bangkok that preliminary discussions with the Saudi Development Fund revolve around funding projects with a total value of up to $1.5 billion, to be implemented gradually in the coming months.
He explained that the first package, valued at $406 million, represents the "first phase" and will be signed "in a few days," adding that another package of projects is under study.
The Saudi funding, which the minister described as easy and gracious loans, will be directed towards sectors including energy, health, housing, infrastructure, and roads, in addition to projects aimed at preparing conditions for the return of Syrians from camps to their cities and villages by providing schools, hospitals, and essential services.
Baranieh said that economic and financial cooperation with Saudi Arabia goes beyond these financings, describing the relationship between the two countries as "strategic," and noting the support that the kingdom provides to Syria in its dealings with international institutions.
IFC studying projects worth about a billion dollars
The Saudi funding represents part of Damascus' moves to resume cooperation with international financial institutions.
Baranieh revealed that the International Finance Corporation (IFC), a private sector arm of the World Bank Group, is currently studying five or six projects in Syria, three of which are "on the verge of readiness" for signing and financing.
The projects focus on sectors like energy, transportation, logistics, agriculture, and food security, while the minister noted that international finance corporation estimates regarding private Syrian and Arab private sector projects revolve around a billion dollars.
Baranieh said these projects will represent "the first real financial work" of the International Finance Corporation in Syria, in parallel with preparatory work beginning with the Multilateral Investment Guarantee Agency (MIGA), also part of the World Bank Group, to provide guarantees against investment risks.
The financing by the International Finance Corporation and guarantees from the Multilateral Investment Guarantee Agency can help mitigate part of the risks faced by investors wishing to enter the Syrian market.
International fund for Syrian reconstruction
Concurrently, Syria and its partners began preparing to establish a multilateral trust fund to support recovery and reconstruction, with Baranieh expecting its establishment to be completed in "a few weeks."
The minister did not specify a target size for the fund's capital, explaining that the meeting held to introduce the initiative was not a conference for receiving financial pledges; instead, it aimed to present Syria's priorities and needs to potential partners.
According to Baranieh, the fund will provide concessional financing and guarantees, along with capacity building and technical support, amid interest from the European Union, Arab countries, and development institutions and agencies to participate or provide support.
The fund also aims to coordinate donor financing, prevent project overlap, and pool resources to finance larger strategic projects according to the priorities of the Syrian government.
The minister emphasized that Damascus wants the fund to be subject to a high level of governance, discipline, and integrity, providing guarantees to donors regarding the management of funds allocated for reconstruction.