Sovereign Fund: between transparency, asset valuation

The release by the Ministry of Finance of its report on the financial performance of the state’s general budget for the first half of 2026 has raised questions in Syrian economic and academic circles.

The questions concern the nature of the relationship between the state budget and the sovereign fund, the amount of money and assets it manages, and the extent to which it is subject to public disclosure and accountability, particularly since the financial report did not include detailed data on the fund’s performance or returns.

The questions have coincided with controversy over the discrepancy between the economic growth figures announced by transitional President Ahmad al-Sharaa, who spoke of growth ranging between 30 and 35 percent, and the Ministry of Finance’s estimates, which put gross domestic product at approximately $33.7 billion and project growth of 11.3 percent during 2026, with expected revenues of around $8.7 billion and expenditures reaching approximately $10.5 billion.

According to information gathered by ANHA agency’s correspondents in Damascus, questions have intensified among Syrians, on social media platforms, and within economic circles regarding the transparency of the sovereign fund’s operations, as well as revenues from electricity and oil companies, on the grounds that these resources constitute public assets that are supposed to be used in accordance with the law and for a measurable and monitorable public benefit.

The questions have focused on the absence of clear figures regarding the growth, revenues, and returns of the sovereign fund in the Ministry of Finance’s financial performance report, in addition to the lack of details on the growth of revenues from customs duties, border crossings, oil, and electricity.

A professor of accounting at a private university in Damascus, who requested anonymity, told ANNA agency that the sovereign fund’s growth rate remains unknown despite the fact that it manages substantial capital and invests public-sector funds, and that this figure was not included in the Ministry of Finance’s financial performance report.

He added that the report also did not mention the growth rate of revenues from customs duties and border crossings, nor revenues from oil and electricity, describing this as a “major gap and a series of unanswered questions” regarding how the transitional authorities are dealing transparently with the Syrian people and providing such figures to researchers and those interested in public affairs.

The sovereign fund was established under Decree No. 113 of 2025, issued on June 24, 2025, as an economic institution with legal personality and financial and administrative independence, affiliated with the Presidency of the Republic.

The decree stipulates that the fund’s objectives include directly implementing development and productive projects, making optimal use of human and material resources, stimulating the national economy, and transforming inactive government assets into instruments of production and development.

It also provides for the adoption of a “strict and transparent” governance system, the preparation of quarterly and annual reports, as well as financial audits conducted by independent bodies and oversight of its activities.

The accounting professor said that despite being a state-owned economic institution, the fund “remains opaque despite the extensive overlap between its activities and those of the state.”

He added that the fund “manages substantial capital and invests public-sector funds,” while transparency, according to him, is limited to submitting reports to the President of the Republic and the Supreme Council for Economic Development, leaving information intended for the public limited.

He continued that this raises questions about “the Syrian people’s right to know about their country’s resources, who manages them, how much return they generate, where they are spent, and whether there is fairness in their distribution among the governorates.”

According to information published on the fund’s website, it currently comprises 36 specialized sectors, in addition to 11 companies operating outside these sectors. More than 40,000 employees and workers are employed across these entities, while the central administration has 270 employees.

Fund officials also announced during the first Syrian-Emirati Forum in May 2026 that there were 36 specialized sectors, 11 central companies, and more than 40,000 employees and workers, in addition to a real-estate portfolio exceeding 70 million square meters across 47 sites, and planned projects with a total value of approximately $100 billion.

For his part, auditor “M.J.” told ANHA agency that the financial statements of joint-stock companies normally contain precise details on revenues and expenses and are not approved without ratification by a substantial proportion of shareholders.

He added that this applies even to a joint-stock company whose capital may not exceed one billion old Syrian pounds, asking: “What about a fund managing this enormous volume of money, sectors, and assets, when we know so little about it because there is no transparency?”

The auditor raised questions about the fund’s decision-making mechanisms, how assets are transferred to it, the fate of confiscated and recovered assets, and which entity audits the fund’s operations when it disposes of extensive public funds and property.

He noted that the sovereign fund will not establish credibility unless public accountability becomes part of its institutional structure, arguing that fund officials’ statement that its governance mechanism is “inspired” by the “Santiago Principles” does not necessarily mean that those principles have been translated into actual institutional rules and practices.

In contrast, Mohamed Abdullah Al-Far, Deputy Director General of the sovereign fund, said transparency is part of the legal framework governing the institution’s work. He noted that Decree No. 113 of 2025 provides for a strict and transparent governance system that includes quarterly and annual reports, financial audits by independent entities, and oversight of the fund’s activities.

Al-Far explained that transparency is not measured solely by the amount of information published, but also by the accuracy of the information and the timing of its disclosure, warning against publishing incomplete data or figures that do not reflect the actual situation.

He said the fund is dealing with assets and projects bearing the effects of years of neglect and a lack of development and modernization, and that the process of transferring assets to the fund is still ongoing in parallel with the work of the Anti-Illicit Enrichment Committee, meaning that the inventory and valuation of assets have not yet been completed.

According to Al-Far, each asset requires a financial, legal, and operational assessment before the most appropriate course of action can be determined, whether development, restructuring, partnership, or divestment. He added that disclosing certain information before the process is complete could affect the investment value of the assets or the fund’s position during negotiations.

The fund launched its official website in June 2026. At the time, Al-Far said the website would serve as a platform for introducing the fund’s activities, vision, directions, and projects, while strengthening communication with partners and interested parties.

During the first Syrian-Emirati Investment Forum, Mazen al-Salhani, Chairman of the Fund’s Board of Directors and Minister of Tourism, said the fund was not seeking to generate immediate profits, but rather to establish strategic and sustainable projects that serve future generations and promote long-term development.

Al-Salhani stressed that the fund’s operations require adherence to the highest global standards of governance, transparency, and investment-policy management.

Economist Karam Shaar likewise said in a published analysis that the fund’s website represents an initial step toward providing information. However, he pointed to the continued limited availability of data concerning the decision-making structure, the asset portfolio, investment negotiation mechanisms, and the procedures for approving investments, calling for the discussion of the Santiago Principles to be translated into measurable institutional rules and practices.

The debate over the fund’s transparency comes as it announces major investments and projects, including an agreement with the UAE-based Arada Group worth approximately $7 billion to develop the “New Damascus” project on an area of 4 million square meters. The project includes residential units and hospitality, education, healthcare, and entertainment facilities.

On August 31, 2026, the Ministry of Finance issued its report on the financial performance of the state’s general budget for the first half of the year. Finance Minister Mohamed Yisr Bernieh said public revenues amounted to approximately $2.7 billion, compared with public spending of around $3.7 billion, resulting in a fiscal deficit of approximately $1 billion.

According to the report, realized revenues amounted to approximately 31 percent of the estimated annual revenues, while execution of total approved expenditures reached around 35 percent. Public revenues increased by approximately 111 percent compared with the first half of 2025, while public spending rose by approximately 331 percent.

The Ministry of Finance indicated that oil and gas revenues began being transferred to the ministry in May, with oil revenues expected to increase during the second half of the year, alongside improved tax and customs collection and some exceptional revenues.

The ministry said the report was issued as part of efforts to enhance financial disclosure, make information available to citizens and stakeholders, and publish budget-execution results on a regular basis.

Against this backdrop, academics, economists, and auditors continue to raise questions about the size of the assets and resources managed by the sovereign fund, the value of the returns they generate, the mechanisms for overseeing them, the extent to which they are incorporated into the broader public financial disclosure system, and the role of the People’s Assembly in accessing their data and holding the relevant authorities accountable.

ANHA