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• 
  Who will fund Syria’s $1tn rebuild?

  11 June 2025

  

   

  Following the end of its brutal civil war in December, Syria now faces an enormous task to rebuild its economy and society. More than half of Syrians are thought to have been displaced, either moving within the country or fleeing abroad; 90% of those still there live in poverty, according to the UN.

  The World Bank has estimated that Syria’s GDP shrank by more than half from 2010 to 2020 and it has continued falling since. Just how far it might have dropped is hard to know, given the lack of reliable data. IMF spokesperson Julie Kozack said on 22 May the Syrian authorities need to rebuild basic economic institutions “including the ability to produce economic statistics”.

  The cost of turning the economy around is another imponderable. One widely touted estimate is it will take $400bn to rebuild or replace everything broken, but Economy and Industry Minister Mohammad Nidal Al-Shaar has put the figure far higher. He told the Arab Media Summit in Dubai in May: “We need at least $1tn to reconstruct and rebuild a new Syria.”

  For now, the sums coming in are relatively modest, given what is needed. In March, international donors pledged $6.5bn in aid, some of which will be handed out over several years.

  “We don't know if the money's going to pour in, but, if it is going to, it isn't pouring in yet,” says Christopher Phillips, professor of international relations at Queen Mary University of London.

  Commercial deals are being signed, however. The Ministry of Economy and Industry issued 345 industrial licences in the first quarter of 2025, in sectors such as food processing, chemicals and textiles, creating an estimated 4,242 jobs.

  Larger projects are meanwhile generally still in the form of memoranda of understanding (MoUs), rather than definite contracts. In mid-May, for example, Dubai’s DP World signed an $800m MoU to develop and operate a terminal at Tartous Port. Later that month, a consortium led by Qatar’s UCC Holding signed a $7bn MoU to develop five power plants.

  Such agreements have been made possible by the removal of many, though not all, international sanctions. On 23 May, the US lifted most of its trade restrictions on Syria. Ten days earlier, President Donald Trump had pledged to remove the sanctions, following lobbying by Saudi Arabia and Turkey.

  European Union, UK and Japanese sanctions are also being eased.

  On a trip to Damascus in late May, Saudi Foreign Minister Prince Faisal Bin Farhan said the easing of sanctions would help in “reactivating the Syrian economy”.

  Commerce resumes

  Trade is slowly building up. Phosphates are being shipped from Tartous Port to Romania and more traffic has been passing through the Nassib border crossing with Jordan – in early June, Amman lifted import bans on some Syrian goods.

  There have been other positive signs too. The Damascus Securities Exchange reopened on 2 June, after a six-month pause, and the country is expected to rejoin the Swift international banking network soon.

  Passenger traffic is building up at Damascus International airport, which now has direct links to Turkey, Jordan, the UAE and Qatar. In May, Flydubai became the first UAE carrier to land at Damascus in almost 12 years; Emirates is due to follow by mid-July. Turkish Airlines subsidiary AJet will start flying to the Syrian capital in mid-June.

  However, serious domestic problems remain. In late April, there were armed clashes between Druze factions and government forces in southern Damascus. In early May, government security forces clashed with pro-Assad fighters in the northwest. More than 1,000 people were killed in these incidents.

  President Ahmed Al-Sharaa included a wide range of voices in the cabinet he announced on 29 March, with representatives from the Alawite, Christian, Druze and other minority groups. However, the most important roles went to his former colleagues in Hayat Tahrir al-Sham (HTS) and it is clear he favours a strong, central government with little autonomy given to different groups or regions. Given the government does not control the whole country, that may be a difficult stance to maintain.

  There have also been cross-border issues with Israel, which is occupying a swathe of territory in southern Syria beyond the 1974 ceasefire line and has conducted hundreds of airstrikes on Syria since December. Among the more recent incidents, on 30 May Israel struck what it claimed were missile storage facilities in the coastal cities of Latakia and Tartous. Israeli officials also claimed on 3 June that two projectiles had been launched from Syria towards its territory.

  Riyadh has positioned itself as a guarantor and has led the way in re-engaging with Damascus
  Nanar Hawach, International Crisis Group

  Restoring regional relations

  Wider international relations hold the key to the Syrian economy’s prospects. In particular, Gulf countries are a potential source of investment that Al-Sharaa is keen to exploit. Qatar and Saudi Arabia have been making the running, while the UAE has been more cautious, not least because of its opposition to Islamist groups gaining political power.

  Al-Sharaa’s pragmatic political approach has brought some useful gains already. The World Bank is planning to restart operations in Syria, after the country’s debts to its International Development Association arm were paid by Saudi Arabia and Qatar. Those two countries are also helping to pay Syrian public sector salaries.

  Saudi Arabia may prove to be the most important Gulf partner going forward, according to some analysts.

  “Saudi Arabia remains the key player shaping the regional response to Syria. Riyadh has positioned itself as a guarantor and has led the way in re-engaging with Damascus,” says Nanar Hawach, a senior analyst covering Syria at the International Crisis Group. “Saudi Arabia sets the tone for how the region deals with Syria.”

  But Syrian officials have also been keen to engage potential investors from further afield, including Turkey, the EU, the US and China.

  “How Al-Sharaa has behaved so far has actually been quite cautious internationally,” says Phillips. “Not trying to align with any one camp or the other, not shutting off avenues. What we're seeing from Syria, is a quite pragmatic approach to foreign affairs.”

  Syrians will be hoping that approach pays off economically before too long.

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  Dominic Dudley
• 
  Record-breaking year for Jordan’s water sector

  11 June 2025

  

   

  Jordan’s utilities sector made a record-breaking start to 2025 with the award of the $3bn Aqaba-Amman water conveyance and desalination project contract. 

  The long-planned project is a major step forward in addressing Jordan’s water scarcity and represents the kingdom’s largest planned water infrastructure project to date. 

  The Aqaba-Amman award means that by the end of May, there had been $3.5bn of contract awards in 2025, according to regional projects tracker MEED Projects, which exceeds the cumulative total for the previous 10 years.

  It is also only the second time on record that Jordan will award more than $1bn-worth of water construction projects in a calendar year. The last time was in 2007, when there were $1.1bn of contract awards.

  The contract for the build, operate and transfer project was signed on 12 January by Jordan’s Ministry of Water & Irrigation and a consortium led by Paris-based firms Meridiam and Suez.

  The project’s desalination plant will have an initial capacity of 300,000 cubic metres a day (cm/d), expandable to 835,000 cm/d, using reverse osmosis technology. It also includes 450 kilometres of pipelines to transport desalinated water from the Gulf of Aqaba to Amman.

  The developer consortium also includes Egypt’s Orascom Construction and France’s Vinci Construction Grands Projets.

  Wastewater tender

  In addition to the Aqaba-Amman project, another significant water development this year is the tendering of package five for the West Irbid wastewater network project. Water Authority Jordan (WAJ) has invited bids for sewerage collection systems and gravity trunk lines for the towns of Soum and Kufr Youba. 

  The project will be financed by a loan and grant administered by the European Bank for Reconstruction & Development (EBRD). The West Irbid wastewater treatment plant project, for which WAJ secured $30m in financing last year, will treat 12,000 cm/d once completed.

  Power contracts

  In the power sector, there had been $33m of contract awards by the end of May, according to MEED Projects. The full-year total last exceeded $100m in 2022, when there were $111m of contract awards, and the last time there was a significantly large total was in 2018, when there were $910m of contract awards.

  The totals may improve soon. This year, Jordan’s Energy & Mineral Resources Ministry (MEMR) sought interest from firms for a 200MW solar photovoltaic project. This project will be developed on a build, own and operate basis and will connect to the national grid via National Electric Power Company (Nepco).

  Additionally, Nepco plans to procure a gas-fired power station with a design capacity of around 500MW, which is expected to be developed using an independent power project model. Advisers are currently being sought for this project.

  In February, Nepco secured a €67.1m ($70.2m) financing package from the EBRD and the EU. This package, consisting of an EBRD loan of up to $56.5m and an EU investment grant of up to €12.4m ($13m), will fund the construction of a high-voltage electricity substation in northern Jordan.

  This substation aims to improve the grid’s capacity to handle existing and new generation, facilitate cross-border interconnections and reduce transmission losses. The project includes the construction of four overhead transmission lines, supporting Jordan’s renewable energy targets for 2030.

  Regional leader

  Today, solar and wind power account for over 30% of Jordan’s total installed capacity of approximately 7.1GW as of 2023. This makes Jordan one of the leaders in renewable energy installed capacity in the Middle East and North Africa region relative to its overall generation capacity. 

  Completed projects include the 89MW Fujeij wind power plant, which became operational in 2019, and the 373MW Qatrana gas-fired combined-cycle power plant, which was commissioned in 2011. Both are backed by long-term power-purchase agreements with Nepco. 

  These projects highlight Jordan’s ability to attract financing, particularly from GCC states, for its renewable energy projects.

  Reassurance required

  Looking ahead, the status of upcoming water and power projects indicates both progress and challenges. While significant strides have been made with the Aqaba-Amman water project, some projects face delays. 

  According to data from MEED Projects, there are $3.3bn of power projects either under way or planned in Jordan, with generation plants accounting for 59% of this total. 

  Despite Jordan’s strong renewable energy resources and regulatory framework, inconsistencies in energy policy, such as the introduction of additional taxes and reluctance to allocate land for renewable energy projects, have created bottlenecks and reduced investor confidence. This has led to several slow-moving projects.

  The fact that only one developer team submitted a bid for the Aqaba-Amman project shows the limited appetite for large-scale projects and Jordan’s utility sector in general. Smaller water treatment and desalination schemes, as well as power substation projects, have proven to be more successful at attracting bidders. 

  For Jordan to overcome these challenges, it must reassure investors and contractors. The award and successful execution of the $3bn Aqaba-Amman project will go a long way towards providing the market with the reassurance it needs.

  ---

  MEED's July 2025 report on Jordan also includes: 

  > ECONOMY: Jordan economy nears inflection point
  > GAS: Jordan pushes ahead with gas plans

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  Colin Foreman
• 
  Jordan economy nears inflection point

  11 June 2025

  

   

  Jordan’s leaders are well-versed in dealing with the economic fallout from regional turmoil, but the past year has stress-tested this crisis management strategy to the limit.

  With President Donald Trump raising questions about future US financial support for Jordan, and halting grants for a large water desalination project on taking office, anxiety levels in Amman have risen substantially this year.

  In 2024, US aid covered around 20% of Jordan’s government budget deficit, so the concern is understandable. Added to this is the threat of the reciprocal tariffs announced in April, which could hit Jordan with a 20% rate – thereby pushing it into the top 10 most affected economies in the world – and the Hashemite kingdom’s concerns about the Trump administration’s actions are grounded in reality. For while Jordan should be able to negotiate down its tariffs, its exports to the US – one-quarter of its total – may still feel the imprint.

  All this comes on top of the regional headwinds that have hit economic growth and placed additional strain on already pressured public finances. The Washington-based IMF sees GDP growth being held back at 2.6% this year, down from 3.1% in 2023 – the year before the full hit of the Gaza conflict was registered. However, the fund also noted that a stronger export performance is offsetting weaker domestic demand.

  Even so, the spillovers from the Palestine conflict, especially in Jordan’s tourism sector, which accounts for 15% of GDP, will remain a policy challenge.

  Capital Economics warned Jordan’s economy would continue to struggle due to the effects of regional conflict and fiscal constraints. The consultancy says a budget contraction of at least 4% of GDP is required to stabilise and lower the public debt-to-GDP ratio, but this may prove too tall an order for the government and would certainly weigh on its GDP growth.

  Lower growth has long-term consequences for Jordan, given its stubbornly high unemployment rate (averaging above 20% since 2020) and low labour force participation rate.

  On the more positive side, the IMF sees inflation remaining low, at about 2%, reflecting the Central Bank’s commitment to monetary stability and the exchange rate peg. However, the current account deficit is projected to widen slightly to just under 5% of GDP in 2025, from under 4% in 2023, due to lower tourism receipts and lower prices for key exports. 

  The banking sector remains well-capitalised, with a capital adequacy level well above the regulatory minimum of 12%, noted the IMF. Non-performing loans remain relatively low.

  Stress test results for the banking sector in 2024 suggested it is broadly able to withstand shocks even under the most severe scenarios. Bank mergers are also on the agenda, with Bank Al-Etihad preparing to acquire Investbank in what would be the country’s largest-ever banking consolidation.

  US U-turn

  Looking ahead, Jordanian officials believe the worst might be averted, having secured assurances from the White House that most foreign aid to Jordan – under which it receives an annual $1.45bn from the US – will survive intact and not be used as leverage in talks.

  The reported resumption in March 2025 of payments from US firm CDM Smith, tasked with overseeing the $5bn Aqaba-Amman Water Desalination and Conveyance Project, will have come as welcome reassurance.

  “What’s interesting is that the US quietly restarted the funding to Jordan, and we know King Abdullah has visited Washington DC a number of times, meeting with Trump administration officials,” says Annelle Sheline, a research fellow at the US-based Quincy Institute, and a former foreign affairs officer at the US State Department.

  “Jordan has been very careful to cultivate relationships among both Republicans and Democrats, and that will have played a role in restarting this funding to Jordan.”

  In addition, Jordan has secured funding from alternative sources, including the EU, which in January committed to extending a €3bn ($3.13bn) financial package. The 2025-27 package will include €640m in grants, €1.4bn in investments and €1bn in macro-financial assistance.

  Despite these welcome support measures, analysts point out that the changing regional political weather may compromise Jordan’s capacity to attract financial support in future.

  “Jordan has lost some of its value because of the Abraham Accords. It used to have a moderate Arab state role, with a relationship with Israel. But the value of that has really gone down. That’s why King Abdullah has been spending time in DC lobbying because he doesn’t know what Trump is going to come up with next,” says Neil Quilliam, associate fellow at the Middle East and North Africa programme at Chatham House.

  Syrian opportunity

  One factor that might positively impact Jordan’s economic prospects is the regime change seen late last year in its large neighbour Syria.

  Jordanian figures show exports to Syria rose almost five-fold in the first two months of the year, reaching JD35.4m ($48.9m) compared to just JD6.1m ($8.5m) in the same two months of 2024.

  Syria’s rehabilitation should also assist in the return of Syrian refugees from Jordanian territory, which number more than 500,000, reducing the considerable burden placed on Jordan’s economy. Further ahead, Syria’s sizeable reconstruction needs will put Jordan in an advantaged position to provide labour and construction materials.

  “Syria’s opening is going to be beneficial in terms of trade,” says Quilliam. “Jordan isn’t necessarily going to be competing with Syria. The Saudis, the UAE, Qatar and Kuwait have been putting money into Jordan for quite a long time. And Syria is going to require a lot of construction materials that Jordan will be a transit for.”

  Moving forward, Jordan may have a harder time getting funding out of Congress
  Annelle Sheline, Quincy Institute

  Fiscal jeopardy

  The biggest cloud on the horizon is Jordan’s ability to maintain US funding over the long term.

  The nearly $1.5bn a year that comes into Jordan from the US is authorised on a four-year cycle and so will have to be renewed at some point during the Trump presidency.

  “That’s going to be the inflection point. They could be fine now for the next two years, but it’s going to get interesting,” says Quilliam.

  As Sheline notes: “It [could be an] uphill battle, given Republican members of Congress were willing to vote against previous foreign aid, which suggests they would be willing to vote against funding for Jordan – given the perception that the US spends too much on sending money abroad. Moving forward, Jordan may have a harder time getting funding out of Congress.”

  While the kingdom has overcome previous funding crises, and the prevailing logic is that Amman always muddles through, with a debt-to-GDP ratio of around 95%, the kingdom has remarkably little fiscal room in which to manoeuvre.

  “The ratchet just gets tighter and tighter each year,” says Quilliam. “And it’s just getting closer and closer to something going wrong. If that $1.5bn from the US stops, then they’re in real trouble. That’s the backstop.”

  ---

  MEED's July 2025 report on Jordan also includes: 

  > GAS: Jordan pushes ahead with gas plans

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  James Gavin
• 
  UAE selects two contractors for West Link

  11 June 2025

  

   

  The UAE has engaged two contracting groups on an early contractor involvement (ECI) basis for the 40-kilometre-long West Link project, which connects the Abu Dhabi mainland to islands in the Gulf near Qatar.

  The two contracting groups that have been selected are Greece’s Archirodon with the local Western Bainoona Group and Hewson Consulting as the design firm, and Beijing-based China Harbour Engineering Corporation with the local NMDC and Subana Jurong as the design firm.

  The project involves constructing a 40km road link with two lanes in each direction. The road is planned to start near Ras Ghumais in the Western Region and extend to a ferry terminal on Makasib Island, which will then connect to Qatar.

  The ECI process requires selected contractors to submit methodologies for the project and a design proposal during the initial stages of procurement. It is understood that the conceptual design and social, economic and business case studies commenced early last year.

  The project is being overseen by the UAE’s Etihad Rail.

  Previous plans

  In 2005, Abu Dhabi and Doha were reported to have been setting up a joint company to oversee the implementation of a proposed UAE-Qatar causeway.

  The crossing would have significantly cut journey times. At present, traffic between Qatar and the UAE has to pass through 125km of Saudi Arabian territory.

  Back then, the causeway was planned to start near Sila in Abu Dhabi and extend to the south of Doha.

  The scheme ultimately stalled. Problems included difficulties with the route, which infringed on Saudi Arabia’s territorial waters.

  In June 2017, the UAE, Saudi Arabia, Bahrain and Egypt severed diplomatic and economic ties with Qatar, preventing any potential joint infrastructure projects.

  In January 2021, the Al-Ula Declaration restored diplomatic ties and economic cooperation has gradually resumed.

  READ MORE: UAE-Qatar causeway could face a geopolitical challenge

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  READ THE JUNE 2025 MEED BUSINESS REVIEW – click here to view PDF

  Gulf accelerates AI and data centre strategy; Baghdad keeps up project spending, but fiscal clouds gather; Banking stocks rise despite lower global oil prices

  Distributed to senior decision-makers in the region and around the world, the June 2025 edition of MEED Business Review includes:

  > AGENDA 1: Data centres churn investments > AGENDA 2: Gulf seizes AI opportunities > SYRIA: US announces lifting of Syria sanctions > MEED TOP 100: Middle East stocks defy lower oil prices > TOURISM: Abu Dhabi hopes bigger is better with Disney theme park > TRADE: Emerging Gulf-Asia corridor grows despite headwinds  > SAUDI ARABIA: Riyadh confirms capital expenditure cuts > INTERVIEW: Mena crucial to Veolia’s growth plan > IRAQ REPORT:  Iraq maintains its pace, for now > GULF PROJECTS INDEX: Gulf projects index leaps 4.3% > CONTRACT AWARDS: Region sees third month of weak awards activity > ECONOMIC DATA: Data drives regional projects > OPINION: Dealmaking trumps the Truman Doctrine

  To see previous issues of MEED Business Review, please click here

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  Colin Foreman
• 
  Dutco and Sweid & Sweid plan Dubai logistics park

  11 June 2025

  Local firms Dutco and Sweid & Sweid have released details of plans for a logistics park in Dubai.

  Known as Terralogix, the development will cover an area of 3.3 million square feet (sq ft) in the Warsan area of Dubai, which is in the north of the emirate close to the Sharjah border.

  The park features a modular design and a flexible leasing model, allowing tenants to scale, expand or custom-build their facilities according to their needs. The project’s first phase is already under way and expected to be completed by the third quarter of 2026.

  In a statement, Sweid & Sweid said that the project is one of the few large-scale logistics developments in northern Dubai. It aims to serve areas currently underserved by existing logistics facilities, which are predominantly located in southern Dubai.

  In December 2024, Sweid & Sweid awarded Dutco Construction a AED730m ($199m) construction contract to build a Grade A office development in Dubai’s Jumeirah Lakes Towers area.

  That development will offer over 500,000 sq ft of office space, with retail space, four underground parking levels and metro connectivity.

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  Colin Foreman