Middle East
HTS to ‘shrink the state’ through privatization and civil servant sackings
Syria’s new Islamist leaders are embarking on a radical overhaul of the country’s economy, including plans to sack a third of public sector workers and privatize state-owned companies that dominated under the Baath Party and the Assad’s.
The first sackings began just weeks after the ouster of Bashar al-Assad on December 8, while the pace of the announced crackdown “against waste and corruption” has triggered protests by government employees, including fears of a “sectarian purge of jobs,” Reuters reported by Riham Alkousaa.
Reuters spoke to five ministers in the interim government formed by Hayat Tahrir al-Sham (HTS), all of whom described the broad scope of plans to “downsize the state.” They said this included the elimination of a large number of “ghost employees” (people who allegedly received salaries for doing little or nothing under Assad).
Reuters lends support to the sectarian narrative, arguing that under Hafez and Bashar al-Assad, Syria was organized as a “militarized, state-led economy that favored an inner circle of allies and family members, with members of the Alawite sect of the family heavily represented in the public sector.”
107 state-owned companies to be divested
HTS’s economy minister, 40-year-old former energy engineer Basil Abdel Hanan, told Reuters that there was a major shift towards a “competitive free market economy.”
The government under “interim president” Abu Mohammed al-Jolani (Ahmed al-Shara) will work to privatize state-owned industrial companies, which Hanan said total 107, most of which are loss-making.
Hanan promised to keep “strategic” energy and transport assets in public hands but did not name the companies to be sold. Syria’s main industries include oil, cement, and steel.
Finance Minister Mohammad Abazeed said in an interview that some state-owned companies existed only to embezzle funds and would be closed down. Abazeed said, “We expected corruption, but not this much.”
Half of the civil servants may be sacked
Abazeed said that based on a preliminary examination, only 900,000 of the 1.3 million people on the state payroll actually showed up for work.
“That means there are 400,000 ghost names. Eliminating them would save considerable resources,” Mr. Abazeed said.
Administrative Development Minister Mohammad Alskaf, who oversees public sector staffing, went further, telling Reuters that the state would need between 550,000 and 600,000 employees, less than half the current number.
Abazeed said that the reforms, which also aim to grant amnesty for penalties and simplify the tax system, aim to remove obstacles and encourage investors to return to Syria.
HTS’s goal is familiar: Reduce bureaucracy, boost exports
“So factories inside the country can serve as a launching pad for global exports,” said Abazeed, who was an economist at Al-Shamal private university before serving as a treasury official in the HTS stronghold of Idlib in 2023.
Since 2017, HTS has been attracting investment and the private sector in Idlib “with less bureaucracy and pressure on hardline religious groups,” according to Reuters.
The new government hopes for a nationwide increase in foreign and domestic investment to create new jobs as Syria rebuilds after 14 years of conflict, three ministers told Reuters.
However, for HTS to replicate the “Idlib model,” it will have to overcome a wide range of challenges, notably international sanctions that severely hamper foreign trade.
The question of the legitimacy of al-Jolani’s government could be raised
Maha Katta, Resilience and Crisis Response Specialist for Arab Countries at the International Labour Organisation, said the economy is currently not in a position to create enough private jobs.
Katta said, “I’m not sure it’s really a wise decision,” adding that restructuring the public sector “makes sense” but questioning whether it should be a top priority for a government that needs to revive the economy first.
While recognizing the imperative for interim leaders to act quickly to get the country under control, some critics see the scale and pace of the planned changes as overreaching.
Aron Lund of the Middle East-focused think tank Century International said, “They talk about a transition, but they are making decisions as if they were a legitimately constituted government.”
Islamist government to administer neoliberal ‘shock therapy’
Economy Minister Hanan said economic policy would be designed to manage the consequences of rapid market reforms to avoid the chaos of recession and unemployment that followed the “shock therapy” imposed on post-Soviet countries in Europe in the 1990s.
Mr. Hanan said, “The aim is to balance private sector growth with support for the most vulnerable.”
The government has announced a 400% increase in civil servant salaries, currently around $25 a month, starting in February. It is also mitigating the impact of layoffs through severance pay or by asking some workers to stay at home while needs are assessed.
Hussein El Khatib, Director of Health Facilities at the Ministry of Health said, “We are saying to the employees who are hired just to get a salary: please take your salary and sit at home, but let us do our job.”
Discontent Among Public Laborers Grows
But discontent among workers is growing. Workers have been showing Reuters lists circulating in the labor and trade ministries, which have scaled back Assad-era employment programs for former soldiers who fought alongside the government in the war.
One of these veterans, Mohammed, told Reuters he was dismissed from his data entry job at the labor ministry on January 23 and given three months’ paid leave. Mohammed said 80 other former fighters had received the same notice, which he shared with Reuters.
Responding to questions from Reuters, the labor ministry said that “due to administrative inefficiencies and implicit unemployment” some employees had been placed on three months’ paid leave to assess their work situation, after which their status would be reviewed.
The plans sparked protests in January in cities such as Daraa in southern Syria and Latakia on the coast.
Daraa Health Directorate employees carried banners reading “No to arbitrary and unjust dismissals” during a demonstration attended by dozens of people.
Demonstrator Adham Abu Al-Alaya said he fears losing his job. He says he supports the elimination of ghost labor but rejects the allegation that he or his colleagues are being paid for doing nothing. He was hired in 2016 to manage records and pay bills.
Abu Al-Alaya said, “My salary helps me meet my basic needs, such as bread and yogurt,” adding that he also works another job to make ends meet.
He said, “If this decision is implemented, unemployment will increase across society, which is something we cannot afford.”
Middle East
France explores Syrian transit routes as alternative oil corridor to bypass Strait of Hormuz
France is evaluating the creation of alternative energy routes through Syria to mitigate potential disruptions in the Strait of Hormuz following the resumption of hostilities between the United States and Iran. French Foreign Minister Jean-Noël Barrot stated that Paris is working on new transit routes for the transport of Persian Gulf oil, with Syria emerging as a prominent option in this context.
“Among the initiatives we have pursued since the beginning of this crisis is the concept of preparing alternative routes, in order to avoid remaining dependent on blockages that could occur here or there,” Barrot said.
Barrot indicated that Syria, which has entered a process of reunification following the collapse of the Bashar al-Assad administration, could become a “new regional hub.” The French minister characterized the country as a strategic corridor that could transport Persian Gulf oil to the Mediterranean, thereby reducing the impact of potential shipping disruptions in the Strait of Hormuz.
Stating that France wishes to expand commercial and economic cooperation with the Damascus administration, Barrot expressed that they aim to establish a secure transit route for Gulf producing nations through this cooperation.
According to Barrot, implementing this plan requires a comprehensive assessment of existing infrastructure and the provision of necessary security guarantees. The French minister noted that these efforts are of critical importance for securing global energy markets.
Barrot’s remarks followed French President Emmanuel Macron’s visit to Damascus on Tuesday. During the visit, Macron met with Ahmed Shara, the former al-Qaeda leader who has declared himself President of Syria.
Patrick Pouyanné, the Chief Executive Officer (CEO) of TotalEnergies, was among the delegation accompanying Macron. Characterizing Syria as a country situated “at the crossroads of the Middle East,” Pouyanné said it could establish a vital energy link between Iraq and the Mediterranean.
In response to the potential closure of the Strait of Hormuz, Iraq has been shipping its oil via tankers through Syria for export since April.
More than 600,000 tons of fuel were exported through this route between April and June. Last month, Iraqi and Syrian officials discussed the reactivation of the Kirkuk-Baniyas oil pipeline and the establishment of energy transit mechanisms.
TotalEnergies has also signed a memorandum of understanding for an offshore exploration block in the Mediterranean. However, Pouyanné stated that beyond this, the company currently has no concrete projects under development.
Stating that security conditions in the country have not yet stabilized, Pouyanné said, “It is clear today that the security situation does not yet permit us to operate here. However, I believe coming here, to Damascus, is a positive initiative.”
Shortly after Pouyanné’s statements, two bombs reportedly exploded near the Four Seasons Hotel, where the French delegation was staying.
Stating that the Syrian administration must be given time to establish control over the country, Pouyanné said, “We must not demand too much,” adding, “We need to be a little patient.”
Middle East
Senior US military officers ignored system alerts on obsolete targets, leading to strike on Iranian school
Senior US military commanders approved strike lists despite automated system warnings indicating that intelligence on certain targets in Iran was years out of date and required revalidation, according to a CNN report citing three sources familiar with the decision-making process.
The warnings were bypassed to “speed things up” under intense pressure to rapidly designate targets during the opening days of the conflict. One of the targets approved by commanders under these conditions resulted in a strike on a school in Minab.
This military decision is directly linked to the February 28 strike on the Shajara Tayyiba School in Minab, which killed at least 168 children and 14 teachers. The heavy loss of life makes the strike one of the mass casualty events involving the highest number of civilian deaths in the recent history of the US military.
According to the sources, automated system warning messages indicating that the intelligence was obsolete were already integrated into the database used during the target development process. Within this system, a target could only be added to a strike list with the approval of a senior officer. Two sources stated that the decision by senior commanders to ignore these warnings directly contributed to the school being targeted “by mistake.”
Military officials reportedly realized within days of the strike on the school that the error stemmed from outdated information. Despite the passage of months, the Pentagon has not released its investigation report on the incident.
A White House official stated that the investigation remains ongoing, asserting, “As we have said before, the US does not target civilians.”
The Pentagon referred inquiries on the matter to US Central Command (CENTCOM), which declined to comment, citing the active investigation.
School and military facility were located within the same compound
The strike reportedly occurred while the US military was targeting an Islamic Revolutionary Guard Corps (IRGC) facility located near the Shajara Tayyiba School. Initial military investigative findings also pointed to this conclusion.
Satellite imagery reveals negligence in the target analysis process. Imagery from 2013 shows the school and the IRGC base located within the same compound, whereas imagery from 2016 clearly indicates that the school had been separated from the base by a fence and provided with a separate entrance.
In satellite imagery dated December 2025, dozens of children can be seen playing in the schoolyard.
The strike took place on the first day of operations following Donald Trump’s decision to launch military action, a period during which military officials and intelligence analysts worked under intense pressure to update thousands of targets.
Analysts were unable to update all records in the Pentagon database prior to the operation. As a result, records for multiple targets—including the IRGC facility adjacent to the elementary school—consisted of information that was more than 10 years old.
Due to the accelerated timeline, analysts prioritized updating “high-priority” records, which included moving targets with a high probability of being struck first and locations posing an immediate threat to US forces. Because fixed facilities were deemed a lower priority, the information for the facility near the school was not updated.
Disconnected databases and staffing shortages compounded the error
At the center of the investigation are two separate targeting databases used by the Pentagon. These are known as the Modernized Integrated Database (MIDB), which was built in the 1980s and relies on manual data entry, and the Mitigation and Analysis Reporting System (MARS), a new artificial intelligence-backed digital platform.
Both systems indicated that information needed to be updated before use. However, efforts to fully transition to the MARS system were reportedly years behind schedule, leaving official targeting data still dependent on the legacy MIDB system.
An intelligence analyst had previously noted changes on the ground in a separate digital tool, but because this tool was not connected to the official targeting database, the information did not reach commanders. How this disconnect influenced the targeting of the school is also being examined as part of the investigation.
Following the strike, Donald Trump suggested that Iran might be responsible for the incident, later asserting that responsibility might never be determined. Defense Secretary Pete Hegseth stated that the strike would be thoroughly investigated, claiming that the US takes every possible measure to prevent civilian casualties.
However, due to cuts implemented early in Hegseth’s tenure, Civilian Harm Mitigation and Response (CHMR) teams within CENTCOM were reportedly facing severe staffing shortages.
Under the cuts made by Hegseth prior to the conflict with Iran, the 10-person civilian casualty specialist staff at CENTCOM was reduced to a single full-time employee.
Sources added that while the remaining staff did everything they could, they lacked adequate resources due to the budget and personnel cuts implemented by Hegseth.
Middle East
US revokes Iran oil license and launches airstrikes following Strait of Hormuz tanker attacks
The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) has revoked a general license that permitted commercial transactions involving Iranian oil.
According to a statement issued by the agency, the “General License X” regulation, which had been in effect since June 21, 2026, was fully rescinded as of July 7, 2026, and replaced by the newly introduced “General License X1” regulation.
The statement noted that a wind-down period lasting until July 17 has been granted to allow for the completion of transactions initiated prior to the revocation.
The Iranian Ministry of Foreign Affairs reacted strongly to the OFAC decision, declaring that Tehran will take all necessary measures to protect its national security and interests.
In a statement shared on the ministry’s official Telegram channel, Iran stated: “The Ministry of Foreign Affairs of Iran decisively condemns the US Department of the Treasury’s decision to revoke the temporary suspension of sanctions on the sale of Iranian oil. This step is a flagrant violation of Article 10 of the memorandum of understanding concerning the cessation of military conflict.”
Following the decision, the US Armed Forces conducted a series of airstrikes targeting Iranian territory during the night of July 8. US officials maintained that the military operation was a response to Tehran’s actions in the region. Washington characterized Iran’s conduct as a violation of the ceasefire regime and a threat to the security of navigation in the region.
The Iranian state broadcaster, IRIB, reported that explosions occurred at various locations across the country. News sources noted that seven explosions were heard near the village of Taherui in the Sirik district, and six explosions were heard near the city of Qeshm.
Previously, US media outlets including The Wall Street Journal and Axios, citing US officials, had reported that despite the active ceasefire, forces of the Islamic Revolutionary Guard Corps had attacked oil tankers near the Strait of Hormuz.
According to data shared by the United Kingdom Maritime Trade Operations (UKMTO), a tanker off the coast of Oman was struck by an unidentified munition, causing a fire on board. It was reported that the incident resulted in no casualties, injuries, or environmental pollution.
The Wall Street Journal reported that one of the targeted vessels may have been the “Al Rekayyat,” a tanker owned by the Qatar-based shipping company Nakilat.
The vessel sustained damage to its engine room, though the crew was reported to be safe. Axios reported that while the attacked vessels sustained damage, no major destruction had occurred.
On June 18, 2026, the US and Iran had signed a memorandum of understanding that established a two-month ceasefire and envisioned the initiation of negotiations for a more comprehensive agreement.
Following the start of the ceasefire period, the US had also struck targets in Iran on June 27 and June 28, citing Iranian actions against commercial vessels in the Strait of Hormuz.
Following those strikes, the Islamic Revolutionary Guard Corps had announced that operations would be launched against US facilities located in Arab countries.
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