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Lebanon could be the key to a mutually beneficial Syrian recovery

Lebanon could be the key to a mutually beneficial Syrian recovery

Lebanon could be the key to a mutually beneficial Syrian recovery
The cost of reconstruction in Syria is estimated at between $250 and $400 billion. (AFP)
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The scale of the devastation in Syria after more than a decade of civil war is almost incomprehensible. The cost of reconstruction is estimated at between $250 and $400 billion.

Meanwhile, neighboring Lebanon is contending with its own profound crisis; it requires $11 billion for recovery after recent conflict and a long-running financial meltdown that has plunged more than 80 percent of its population into poverty.

At first glance, pairing one fractured state with another might seem counterintuitive. Yet, a deeper examination reveals that their fates are inextricably linked. The international community therefore faces a critical choice: pursue a coordinated strategy that recognizes this connection, or risk a siloed approach that could perpetuate regional instability.

The potential role of Lebanon in the reconstruction of Syria is anchored in a deeply embedded, if often fraught, economic symbiosis that has persisted for decades. Lebanon served as Syria’s indispensable financial and commercial conduit during periods when the latter faced international isolation, particularly under the Assad regime.

Until its own collapse in 2019, Beirut’s banking sector facilitated foreign currency transactions and remittance flows for Syrian elites, circumventing a sanctioned financial system. Lebanese seaports and airports evolved into vital arteries for Syrian trade, with more than 250 trucks crossing into Syria each day before the civil war, transporting goods ultimately destined for other regional markets via routes such as the Nassib border crossing into Jordan.

Such commercial interdependence thrived even amid Syria’s 29-year military presence in Lebanon, with Lebanese entrepreneurs, engineers and service providers establishing strong footholds in Damascus, Aleppo and Homs.

These historical relationships forged a complementary economic structure. Syrian migrant labor became the backbone of entire sectors within Lebanon, dominating agriculture in the Bekaa and Akkar regions, and constituting much of the construction workforce.

In return, Lebanese financial and professional services offered Syrian businesses access to hard currency, international imports and diaspora remittances, functions its own state-controlled economy could not reliably serve.

The cost of severing this functional connectivity is quantifiable and would be severe. The current economic paralysis in Lebanon creates destabilizing spillovers that undermine regional recovery. Ignoring this integrated history risks foreclosing a viable channel for the reconstruction of Syria, a country that has accrued billions of dollars of infrastructural and economic losses, according to UN Development Programme estimates, while also jeopardizing a potential engine for Lebanon’s own revival.

Critics would say otherwise but the mechanics of joint recovery are tangible. Geographic proximity provides a tangible logistical advantage; the port of Tripoli is only 30 kilometers from the Syrian border, offering a direct supply route into northern regions, including Aleppo and Homs, where the scale of the devastation requires an estimated $35-40 billion for residential rebuilding alone.

While Syria is working to advance the development of its own port infrastructure, including a DP World-operated terminal at Tartus and French company CMA CGM’s $260 million investment in the expansion of facilities at Latakia, there are systemic impediments: failures of governance, entrenched networks of corruption, and investor apprehension as a result of ongoing foreign military influence.

Tripoli, in comparison, represents a more viable entry point, particularly as the institutional weaknesses in Syria elevate the risks of diversion of funds and inefficiency. International donors, who have already pledged billions for Syrian recovery, including a $6.3 billion EU commitment, might understandably hesitate to route funds directly through the country’s own institutions. Lebanon, however, despite its own governance challenges, can offer a more transparent intermediary platform with established, albeit damaged, financial and logistical frameworks.

Moreover, the vast Lebanese diaspora, which has historically channeled remittances, investment and professional expertise into the country, represents a ready network that could be mobilized to complement international reconstruction aid, offering a layer of trusted capital and skills that Syria’s fragile institutions currently lack.

However, this potential is entirely contingent upon the ability of Lebanese authorities to execute radical domestic reforms. The collapse of the country’s financial system in 2019 rendered the currency worthless and trapped depositors’ savings, creating a fundamental obstacle.

While recent legislative steps, including an amendment to banking secrecy laws in April this year, and banking sector restructuring legislation in July, represent technical progress on this front, they have yet to result in the restoration of basic functionality; depositors remain frozen out of their accounts and systemic corruption endures.

A stable Syria requires a functioning Lebanon, and a recovering Lebanon needs a Syria that is rebuilding.

Hafed Al-Ghwell

Compounding this, the failure of the state to assert its sovereignty, through the disarmament of Hezbollah, continues to erode international confidence, casting doubt on Lebanon’s capacity to serve as a reliable conduit for the hundreds of billions of dollars required for Syria’s recovery.

Without credible and transparent governance, Lebanon’s own $11 billion reconstruction needs will further divert focus, ensuring that both nations remain trapped in a cycle of instability.

Failure to establish independent regulatory oversight and ensure adherence to anti-money laundering standards will result in Lebanon being bypassed and missing out on this great opportunity to become a critical pillar of Syria’s recovery.

Therefore the reconstruction of Beirut’s port, destroyed by a massive explosion in 2020, is no longer merely an infrastructure project, it will be the ultimate litmus test of whether or not Lebanon can manage itself responsibly. The efficient and transparent rebuilding of the port would signal a break from the past, while restoring not only a critical transit point for goods destined for Damascus and central Syria, but also some much-needed confidence and trust in Lebanese institutions.

If calibrated and executed well, it would also help ease the very woes that justify the urgency of a joint approach to recovery. The poverty rate in Syria stands at 90 percent, with 16.7 million people in need of humanitarian assistance. Meanwhile, Lebanon’s gross domestic product has contracted by a cumulative 40 percent since 2019.

If reconstruction in Syria ends up dominated solely by external powers, such as Turkiye, or captured by the same economic networks that profited under the former regime, it will reproduce the social inequities and ills that sparked the initial uprising in 2011.

Similarly, if Lebanon pursues its recovery in isolation it will fail to address the cross-border economic dynamics essential for its revival.

Ultimately, the question is not whether Lebanon is currently the key to recovery, but whether it can become the key through concerted international pressure and internal transformation. The international community must recognize that investment in Lebanon’s recovery is also a direct investment in the stabilization of Syria.

Channeling reconstruction financing and technical assistance through a reformed Lebanese framework would accelerate the rebuilding of Syria, while providing Lebanon with the economic lifeline it so desperately needs.

More importantly, a joint approach also creates mutual incentives for good governance in both countries.

To treat their recoveries as separate endeavors is to ignore the fundamental lesson of the past decade: instability knows no borders. A stable Syria requires a functioning Lebanon, and a recovering Lebanon needs a Syria that is rebuilding.

The alternative is a continuing cycle of collapse that benefits only the agents of chaos.

• Hafed Al-Ghwell is senior fellow and program director at the Stimson Center in Washington and senior fellow at the Center for Conflict and Humanitarian Studies. X: @HafedAlGhwell
 

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