Iran’s Marshall Plan for Syria Collapsed

Iran invested heavily in Syria over more than a decade with an ambitious plan to rebuild the war-ravaged state and secure economic and strategic influence, Reuters found in documents from Iran’s looted Damascus embassy. Inspired by the U.S. Marshall Plan, a 33‑page Iranian economic strategy document dated May 2022 envisioned Syria as a platform for regional leverage and economic empire. The study, drawn up by an Iranian policy unit in Syria, described reconstruction as a chance to create “economic, political and socio‑cultural dependence.” Projects ranged from power plants to oil extraction, but none delivered the anticipated strategic payoff after the collapse of the Assad regime in December 2025.

Iran’s early and deep intervention—militarily backing Bashar al‑Assad and economically supporting reconstruction—was disrupted entirely when rebels hostile to Tehran toppled Assad and installed a new government. The ouster forced Iranian paramilitaries, diplomats, and commercial entities into a hasty withdrawal, leaving behind abandoned contracts, incomplete infrastructure, and outstanding debts. Among the portfolio of roughly 40 documented projects was a €411 million power plant in Latakia, now idle, and an oil project in the eastern desert that was never completed. Across these ventures, Syrian outstanding debts to Iranian companies amounted to at least $178 million, according to the embassy files. Former Iranian lawmakers have estimated Syria’s total debt to Iran at more than $30 billion.

Reuters’ review of letters, contracts, and official cables revealed multifaceted obstacles: militant attacks, local corruption, Western sanctions, and U.S. bombing runs all hindered progress. A U.S. coalition airstrike years earlier destroyed a $26 million Euphrates River rail bridge built by an Iranian charity; it was neither repaired nor fully paid for. Iranian companies like Mapna Group and Copper World faced financial losses, including a private trader who lost €16 million in vehicle parts shipped to Latakia just before Assad fled. Mapna had been contracted to build power infrastructure and repair the war‑damaged grid, but currency volatility, bureaucratic delays, and preferential contract awards to Assad‑linked intermediaries slowed progress.

Iran’s broader economic engagement included free trade deals and substantial credit lines to Syria—$3.6 billion in 2013 and $1 billion in 2015. United Nations estimates suggested Iran was spending about $6 billion annually in Syria by 2015, though Tehran has dismissed figures as exaggerated. Despite this, many projects stalled, and infrastructure damage from conflict limited economic recovery. Iranian businesses lost ground to competitors, including Russia, which focused on profitable oil and gas sectors. By 2022–2023, only 11 Iranian‑linked companies registered in Syria annually—a marginal increase from the worst war years.

The collapse of Iran’s economic vision in Syria arrives as Tehran faces broader regional setbacks. Its militias and proxies have suffered defeats at the hands of Israeli strikes—eroding the so‑called “Axis of Resistance” that once tied Tehran to allies in Lebanon, Gaza, and Syria. At the same time, U.S. pressure on Iran’s nuclear program and rising competition from regional rivals such as Türkiye and Israel reshapes influence dynamics. The nascent Syrian government, led by Ahmed al‑Sharaa and formerly aligned with Hayat Tahrir al‑Sham, has other priorities, and debts owed to Iranian companies have become secondary concerns. Al‑Sharaa told Reuters in December that “the Syrian people have a wound caused by Iran, and we need a lot of time to heal.”