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The Staggering Price of Syria’s Reconstruction

Five years of war in Syria have left large swathes of the country in ruin. And with the peace process on the brink of collapse, an end to the war is nowhere in sight. But with a reconstruction bill that is likely to run well over $100 billion, planning for Syria’s eventual rebuilding must start now.

Written by Perry Cammack Published on Read time Approx. 4 minutes

The cataclysmic destruction of Syria challenges human comprehension. The old city of Aleppo, which like Damascus claims to be the oldest settlement on the planet, has been reduced to rubble. Homs was once the country’s third most populous city, but has mostly been depopulated.

With the international Syria peace process teetering on the edge of collapse, a political solution seems distant. But every war must end. The rebirth of Dresden, Berlin, and Stalingrad (later renamed Volgograd) after the unthinkable destruction of World War II is a testament to human resiliency and a symbol of what may eventually be possible in Syria. Regardless of whether Syria can be stitched together as a unitary state or is instead permanently partitioned, rebuilding its infrastructure to even modest pre-war levels will require a generational effort.

Some planning for this future has been done. The most ambitious effort is the “National Agenda for the Future of Syria,” a conceptual platform for reconstruction run out of the U.N. Economic and Social Commission for Western Asia (ESCWA) in Beirut. But such efforts will need profound outside support, especially during the most fragile post-conflict stabilization phase, to ensure that robust mechanisms are in place to allow funds to begin flowing quickly and transparently. Unfortunately, to this point, the reconstruction of Syria has not received sufficient attention, either in Washington or in capitals elsewhere.

After World War II, the United States contributed some $13 billion to the Marshall Plan to support the rebuilding of Europe, the equivalent of well over $100 billion in today’s dollars. The bill for Syrian reconstruction, though impossible to estimate with any precision, is likely to be hundreds of billions of dollars.

Where will these funds come from? Unfortunately, the math does not add up. The United States, Europe and other advanced economies will be expected to contribute generously to any Syrian political settlement. But even a several billion dollar annual joint commitment fully sustained for a decade probably will not cover more than a quarter of the need. And the collapse of oil prices – and the austerity budgets in oil exporting countries that have followed – means that resources from the Gulf monarchies, which have helped fund everything in recent decades from the first U.S. invasion of Iraq to the Egyptian government, will likely not approach the scale that is needed.

Some of the remaining shortfall can be squeezed out of private investors, international financial institutions and the diaspora community. But whereas Europe was able to undertake its own reconstruction once a rejuvenated West German industrial engine began to power broader economic growth, the pre-war Syrian economy more closely resembled the Belarusian one.

The Cold War was hardly an ideal outcome to World War II, but it did provide a clear division between East and West and sufficient geopolitical stability to allow rebuilding to occur. The war in Europe ended with Hitler’s death, notwithstanding a few isolated incidents of Nazi “werewolf” resistance. By contrast, a Syrian political settlement would not necessarily put an end to interference by its neighbors. After a comprehensive peace agreement, the process of re-integrating hundreds of competing militias groups will be arduous and fraught, and the remnants of the Islamic State or its successor organizations are likely to bedevil Syria for years to come.

Further complicating matters, reconstruction is increasingly a regional challenge. Iraq, Libya and Yemen are all suffering from their own civil wars, and the turmoil could spread further still. While Iraq and Libya have significant resources to help pay for their own reconstruction, they too will need significant international assistance. In Ramadi and other cities in northwest Iraq, the fight between the Iraqi army and the Islamic State has resulted in a scale of destruction approaching that of Syria. Yemen, too, has been devastated, though costs there may be less if only because there is less infrastructure to destroy.

Given the magnitude of the challenges, reconstruction efforts for Syria and beyond need to be supported with the creation of formal institutional structures. One possible model is the European Bank for Reconstruction and Development (EBRD), created after the collapse of the Soviet Union in 1991 with a mandate to help the former communist countries of Eastern and Central Europe integrate into the global economy. An Arab Bank for Reconstruction and Development (ABRD) would need buy-in – and capital contributions – from the Arab states themselves, with the Gulf states providing the largest contributions, and from global powers such as the United States, Europe, Russia and China. The inclusion of regional actors like Turkey and, especially, Iran would be more controversial, but there is no reason to exclude Tehran, if it is willing to ante up the necessary capital contribution.

The EBRD’s 18-month inception period before formally opening its doors in April 1991 is relatively short by international institutional standards. Assuming that the creation of an ABRD followed a similar time frame, there is an urgent need for the principal stakeholders to begin discussions now, rather than waiting until after a political settlement in Syria to begin pondering what mechanisms are necessary to support it. A good place to begin these preliminary discussions is the so-called International Syria Support Group, the informal grouping of 17 countries and 3 organizations, participating in the Vienna process.

After World War II, the Marshall Plan helped not just to kick-start the reconstruction of a decimated Europe, but also to catalyze European economic integration. Similarly, a strong international commitment to Syria’s rebuilding, with a solid institutional framework, could help bolster whatever political arrangement eventually emerges.

Top image: Night falls on a Syrian rebel-controlled area of Aleppo in 2012 after airstrikes targeted the area, killing dozens. (Narciso Contreras/AP)

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