Syria is a country of some 15 million people with a GDP of $16 billion at the blended government exchange rate of 34.26 Syrian Pounds (SP)/USD and $11 billion at the free market rate of 50 SP/USD.
Major sectors of the Syrian economy, including heavy industry, banking, insurance, and utilities remain firmly in the public sector. Other sectors, including food processing, pharmaceuticals, and transportation, have recently been opened to the private sector.
Major sources of hard currency are oil revenues, foreign aid, remittances from Syrian workers abroad, and exports of agricultural products such as cotton and wheat in addition to limited exports of light industrial products especially textiles. In the early 90s, rising oil production, record harvests, and aid flows spurred GDP growth of 7-8 percent.
More recently, oil production and foreign aid have begun to decline. These factors and relative recession in local markets brought GDP growth down to a range of 4-6 percent since 1994.
A complex multiple exchange rate system remains in place, despite incremental efforts to move the "neighboring country rate" towards the "free market rate". Tariffs remain high. Import restrictions remain numerous despite an increase in the types of goods the private sector can import. Real interest rates are negative and the private sector has very limited access to capital. Bank loans require collateral as well as a third-party sponsor. Industrial machinery and power generation equipment as well as oil field services and equipment remain the most important exports to Syria. In the near-term, expansion of the private sector may lead to rapid growth in demand for food-processing and textile machinery. Increased tourism also may provide new demand for Arab and international products.
Syria enjoys a good road network between major Syrian cities and neighboring countries. The railroad system is good but is used mainly to ship commodities such as grains and rock phosphate in bulk. There are two international airports in Syria: Damascus and Aleppo. The country's two ports at Latakia and Tartus are presently sufficient for the country's current needs.
Modernization and expansion of the two existing ports also are under consideration. There are plans to construct a new port to accommodate larger vessels.
Syria is developing its telecommunications system rapidly. Internet is still not available but is expected to operate within six months. Cellular phones also are unavailable and likely will not be in service before 2-3 years.
In recent years, Syria's electricity generating capacity has caught up with demand, but problems in the distribution system still lead to periodic power outages.
Municipal water supply is presently adequate. Some water rationing is very common in the major cities in the summer months.
Finally, there are plans for the establishment of well-serviced industrial zones around major cities.