Is Syria’s Caretaker Government Overstepping its Mandate in Setting Economic Policy?

Is Syria’s Caretaker Government Overstepping its Mandate in Setting Economic Policy?

A caretaker government is meant to provide continuity without making major policy shifts. Yet Syria’s current administration appears to be testing these limits, implementing changes that could reshape the economy well beyond its interim role. While some measures address urgent economic concerns, others raise legitimacy issues due to their lasting impact.

The traditional restraint of a caretaker government was exemplified by Decision No. 1 of 2025, issued by the Syrian Council of Ministers on 5 January, which outlined fiscal adjustments for the 2025 budget. With no agreed-upon 2025 budget due to the suspension of parliamentary activities, expenditures will adhere to the 2024 budget on a “one-twelfth” basis, allocating 1/12 of the previous year’s budget per month. Spending is limited to salaries, essential services, and critical operations, while new investments and development projects are deferred. This is a clear example of a caretaker government managing day-to-day operations while ensuring stability—just as seen in the appointment of caretaker ministers.

But Syria’s Caretaker Government (CG) has made declarations and decisions far beyond its mandate.

For example, CG authorities have argued for a shift away from Ba’ath-era socialist policies, announcing a transition to a “competitive free-market economy.” While their stated goal is to reorient Syria’s economic framework to benefit all sectors of society, such sweeping changes exceed a caretaker government’s typical remit. Similarly, the CG is spearheading efforts to privatize state-owned enterprises, about 70% of which currently operate at a loss.

The Caretaker Minister of Finance’s statements on comprehensive tax reform are also ambitious but premature. Such reforms require extensive deliberation and political consensus—neither of which a caretaker government possesses, particularly given that the CG is dominated by the ideology of the forces that toppled the Assad regime. Tax systems are fundamental to the social contract and shape the relationship between the state and its citizens, making inclusivity essential.

Beyond policy shifts, CG authorities have unilaterally canceled contracts signed by the former government with foreign entities, including a Russian company managing the Port of Tartous and two joint-venture agreements with Jordanian and Iraqi companies. Regardless of how these contracts were negotiated, such cancellations exceed the CG’s mandate, particularly given the lack of transparency. Additionally, the CG has reportedly reached settlements with businessmen linked to the former Assad regime, bypassing the judiciary and undermining accountability mechanisms.

However, some of these actions—though exceeding the traditional caretaker mandate—may be unavoidable given Syria’s dire economic and political circumstances.

The unification of tariffs across CG-controlled areas was a critical step toward consolidating Syria’s fractured economic landscape. Similarly, revising import policies in former regime-held areas—where most imports were either banned or heavily restricted—has facilitated the free flow of goods, improving access to essential items. The liberalization of oil imports and the decision to allow citizens to hold and trade dollars freely may also be justified given their urgency and the ease with which these policies could be reversed.

Transparency is critical. Records of economic decisions—including financial settlements with former cronies or foreign investments—must be made public. Independent audits overseen by Syrian or international bodies can help prevent corruption and favoritism, build public trust, and secure international support. International actors must ensure accountability by tying financial support to strict transparency and inclusivity measures.

Rather than pursuing sweeping reforms beyond their mandate, CG authorities should prioritize building broad consensus for a fully empowered transitional government—something Interim President Ahmad al-Sharaa has pledged to do.

Rushed reforms should be deferred until a representative transitional authority is in place. When the time comes, economic reforms must follow rigorous frameworks with public consultations, competitive bidding, and safeguards against monopolization. In the meantime, improving public enterprise efficiency can yield immediate benefits without committing to long-term policy shifts.