Saudi Arabia and Qatar agree to pay Syria's World Bank debt

Move will pave the way for World Bank Group to resume support and operations in Syria

Saudi Arabia's Crown Prince Mohammed bin Salman, right, hosted Syrian President Ahmad Al Shara in Riyadh in February. EPA

Saudi Arabia and Qatar will settle Syria's outstanding debts of about $15 million to the World Bank, they announced on Sunday.

A joint statement carried by the Saudi Press Agency confirmed reports of a plan to clear Syria's debts. The two Gulf countries said it will pave the way for the World Bank Group to resume support and operations in Syria after a suspension of more than 14 years.

They said the plan came "in continuation of the ongoing efforts by the Kingdom of Saudi Arabia and the State of Qatar to support and accelerate the recovery of the Syrian Arab Republic’s economy". It follows talks on the margins of the World Bank and International Monetary Fund's spring meetings in Washington.

The statement said they "jointly announce their commitment to settle Syria's outstanding arrears to the World Bank Group, totaling around $15 million". Syria has huge reconstruction needs after a 14-year civil war culminated in former leader Bashar Al Assad being toppled by a rebel-led offensive late last year.

"It will also unlock Syria’s access to financial support in the near term for the development of critical sectors, as well as technical assistance that will contribute to institutional rebuilding, capacity development, and policy formulation and reform to drive development," the two countries said.

They called upon international and regional financial institutions "to promptly resume and expand their development engagement in Syria and to expand efforts to improve the lives of the Syrian people".

Syria has about $15 million in arrears to the World Bank which must be paid off before the international financial institution can approve grants and provide other forms of assistance.

But Damascus is short of foreign currency and a previous plan to pay off the debts using assets frozen abroad did not materialise. In January, the US issued a six-month exemption for some sanctions to encourage humanitarian aid, but this has had limited effect.