The economy of Syria, primarily based on agriculture in the country's early years, deteriorated after the start of the Syrian civil war in March 2011.

[16] Although the presence of the Allied forces during World War II stimulated commerce by providing markets for agriculture, textiles, and other locally manufactured goods, Syria lacked both the infrastructure and the resources to achieve economic prosperity.

[16] By the mid-1960s, government-sponsored land reform and nationalization of major industries and foreign investments had confirmed the new socialist direction of Syria's economic policy.

[16] As the state assumed greater control over economic decision-making by adopting centralized planning and strictly regulating commercial transactions, Syria experienced a substantial loss of skilled workers, administrators, and their capital.

[16] Despite the political upheavals, which undermined the confidence of landowners, merchants, and industrialists, the state successfully implemented large-scale development projects to expand industry, agriculture, and infrastructure.

[16] Massive expenditures for development of irrigation, electricity, water, road building projects, irisin plants and expansion of health services and education to rural areas contributed to prosperity.

[16] Syria, as a front-line state in the Arab-Israeli conflict, was also vulnerable to the vagaries of Middle East politics, relying on Arab aid transfers and Soviet assistance to support mounting defense expenditures.

[17] To restore the economy, the government sharply reduced spending, cut back imports, encouraged more private sector and foreign investment, and launched an anticorruption campaign against smugglers and black-market money changers.

[16] Foreign exchange reserves plummeted, the trade deficit widened, and real gross domestic product growth fell as economic difficulties compounded.

He emphasized, in particular, "the need to modernize the regulatory environment and the industrial base, activate and encourage the private sector, remove bureaucratic obstacles to investment, increase job opportunities, qualify cadres, improve education and expand information technology.

"[20] While the government's neoliberal reforms indeed contributed to ramping up trade and invigorating the private sector, these were accompanied by rising inequality, declining public services, and increasingly overt forms of corruption, which ultimately helped fuel protests in 2011.

[23] However, poor climatic conditions and severe drought badly affected the agricultural sector, reducing its share in the economy to about 17% of 2008 GDP, down from 20.4% in 2007, according to preliminary data from the Central Bureau of Statistics.

[24] Since the outbreak of the Syrian Civil War, the Syrian economy has been affected by economic sanctions restricting trade with the Arab League,[25] Australia,[26] Canada,[27] the European Union,[28] (as well as the European countries of Albania,[29] Iceland,[29] Liechtenstein,[29] Moldova,[29] Montenegro,[29] North Macedonia,[29] Norway,[30] Serbia,[29] and Switzerland),[31] Georgia,[29] Japan,[32] South Korea,[33] Taiwan,[34] Turkey,[35] and the United States.

[42][43] Following the end of Bashar Al-asad regime and the civil war, the interim government appointed for the first time in history a woman as governor of the central bank.

[44][45] During the 1960s, along socialist lines, the government nationalized most major enterprises and adopted economic policies designed to address regional and class disparities.

Despite the mitigation of the severe drought that plagued the region in the late 1990s and the recovery of energy export revenues, Syria's economy has historically faced serious challenges.

[53] Prior to the civil war, Syria attempted to ease its heavy foreign debt burden through bilateral rescheduling deals with virtually all of its key creditors in Europe, including Germany, France, and Russia.

Later that year, Syria reached an agreement with Slovakia and the Czech Republic to settle an estimated $1.6 billion in debt, in exchange for a one time payment of $150 million.

[54] Agriculture is a high priority in Syria's economic development plans, as the government seeks to achieve food self-sufficiency, increase export earnings, and halt rural out-migration.

[57] Thanks to sustained capital investment, infrastructure development, subsidies of inputs, and price supports, before the civil war Syria went from a net importer of many agricultural products to an exporter of cotton, fruits, vegetables, and other foodstuffs.

Most irrigated land is designated "strategic", meaning that it encounters significant state intervention in terms of pricing, subsidies, and marketing controls.

[62] During the civil war which began in 2011, the Syrian government was forced to put out a tender for 100,000 metric tonnes of wheat, one of the few trade products not subject to economic sanctions.

[64] The power distribution network has serious problems, with transmission losses estimated as high as 25 percent of total generated capacity as a result of poor quality wires and transformer stations.

[14] The main industrial products are petroleum, textiles, food processing, beverages, tobacco, phosphate rock mining, cement, oil seeds crushing, and car assembly.

[14] Syria's manufacturing sector was largely state dominated until the 1990s, when economic reforms allowed greater local and foreign private-sector participation.

Private participation remains constrained, however, by the lack of investment funds, input/output pricing limits, cumbersome customs and foreign exchange regulations, and poor marketing.

[needs update][60] The United States, European Union, Arab League and Turkey all also imposed sanctions on the Central Bank because of the Civil War.

In the 2000s, Syria started reforms in the financial sector, including the introduction of private banks and the opening of the Damascus Securities Exchange in March 2009.

In February 2008, the government permitted investors to receive loans in foreign currencies from local private banks to finance capital investments.

A report by Strategic Foresight Group, an India-based think tank, calculated the opportunity cost of conflict for the Middle East for 1991–2010 at US$12 trillion in 2006 dollars.