World Bank clears Syria of $15.5m outstanding debt after Saudi Arabia and Qatar foot the bill

The move restores the country's eligibility to tap the global lender for further support

Collapsed buildings in Aleppo. The estimated cost of reconstruction in Syria varies from $250 billion to $500 billion. AFP

The World Bank has cleared Syria of its $15.5 million outstanding debt after Saudi Arabia and Qatar paid for it, in another positive sign for the nation's damaged economy.

The clearing of the arrears, made effective on May 12, reinstates Syria's eligibility to receive World Bank support and operations after a 14-year hiatus, the Washington-based institution said in a statement on Friday.

Saudi Arabia and Qatar announced their plans to settle Syria's outstanding debts on April 27, in "support of and to accelerate the recovery" of Syria, following discussions at the World Bank and International Monetary Fund's spring meetings in Washington.

"As of May 12, 2025, there are no remaining outstanding balances on IDA credits to the Syria," the World Bank said, referring to its International Development Association financing arm.

The IDA focuses on low-income countries, providing grants and low-interest loans to "help countries invest in their futures, improve lives and create safer, more prosperous communities around the world".

Damascus had a plan to pay off that debt but was short of foreign currency. In January, the US issued a six-month exemption for some sanctions to encourage humanitarian aid but this has had limited effect.

The Syrian economy has been devastated by the civil war, which began in 2011. The UN's Development Programme estimates cumulative losses – including physical damage and economic deprivation – of $923 billion at the end of last year.

The estimated cost of reconstruction has varied from $250 billion and $500 billion.

The national economy, which had been maintaining a brisk pace of growth before the protests against the regime of deposed president Bashar Al Assad, has struggled since: gross domestic product plunged 6.4 per cent in 2016 before gradually recovering, government data shows.

But the situation has been improving: in March, Syrian President Ahmad Al Shara announced new members in his government, appointing 23 ministers in a broadened cabinet, a move seen as an important milestone in the transition from decades of Al Assad family rule and the improvement of ties with the West.

It further accelerated after US President Donald Trump, during his Gulf tour this week, announced the lifting of sanctions on Syria, drawing cheers from its citizens and optimism from analysts. He also met Mr Al Shara in Riyadh.