Comparative Lessons from Post-Conflict Transitions (1990-2025) and Prospects for a New Syrian Social Contract

Authored by / Ayham Esmaiel

Economist

Executive Summary

This study explores the critical relationship between political economy and sustainable peace in post-conflict societies, with particular application to Syria in the post-Assad era. The thesis proceeds from a central hypothesis: the economy is not a subsequent outcome of peace, but rather its essential infrastructure and foundational condition. Through in-depth comparative analysis of post-conflict experiences since the 1990s—including Rwanda, Mozambique, Bosnia, Iraq, South Sudan, and Libya—the study reveals that lasting peace is built through daily economic decisions that reshape the relationship between state and society, not solely through political agreements.

The study demonstrates that relatively successful transitions were characterized by clear priorities: early monetary stabilization, large-scale employment generation, fiscal institution-building, and economic accountability. In contrast, other experiences failed due to rent dependency, the absence of a fiscal backbone, or uncontrolled economic fragmentation. For Syria, the study provides an analytical framework for understanding current economic challenges—from currency collapse to widespread unemployment—and proposes an approach for building a new social contract based on legitimate extraction, predictable distribution, and employment as an economic right.

1. Introduction: Why Does Peace Begin with Economics?

When wars end, societies do not automatically transition from violence to stability. What actually occurs is a shift from organized violence to a partially organized void. In this void, daily economic decisions—wages, prices, subsidies, job opportunities—become the language through which the new state speaks to its citizens.

Johan Galtung, one of the most prominent theorists of peace studies, argues that true peace is not measured by the absence of bullets, but by the absence of structural violence—that silent violence which prevents people from living dignified lives (Galtung, 1969). Political economy researchers go a step further, arguing that violence returns when the state fails to reorganize access to resources and opportunities in a socially acceptable manner (North, Wallis & Weingast, 2009).

In other words, peace is not merely a political agreement, but a new economic contract. This contract is not written only in constitutions, but in labour markets, in bread prices, and in people’s ability to plan for the future. From this perspective, studying the experiences of countries emerging from wars since 1990 becomes necessary in order to understand what awaits Syria—not as an exceptional case, but as a delayed case within a recurring global trajectory.

2. Theoretical Framework: From Negative Peace to Positive Peace

2.1 Conceptual Distinction: Peace as Absence or as Construction?

The end of military operations does not represent the end of conflict in the structural sense. Classical literature in peace studies clearly distinguishes between negative peace (the absence of direct violence) and positive peace (the existence of just and sustainable political, economic, and social systems), as formulated by Johan Galtung in the late 1960s.

Within this framework, the economy is viewed not as a technical sector subordinate to politics, but as the critical domain in which the credibility of the entire political transition is tested. A state emerging from armed conflict is required to reorganize three central relationships simultaneously: its relationship with society (legitimacy), its relationship with resources (extraction and distribution), and its relationship with violence (the legitimate monopoly of force).

2.2 Institutional Political Economy and Social Contract Theory

Douglass North and his colleagues confirm in their seminal work Violence and Social Orders that societies emerging from violence face a structural choice between reproducing a “limited access order” based on rent and elites, or gradually transitioning toward a broader institutional system grounded in rules and accountability (North, Wallis & Weingast, 2009).

From this perspective, the question “Will peace succeed?” is fundamentally a political-economic question: will the new system succeed in building an economy that generates income, opportunities, and legitimacy, or will it reproduce the patterns of exclusion and extraction that fueled the conflict?

Charles Tilly’s theory indicates that the state is built through negotiation over taxes, services, and protection (Tilly, 1992). In the post-conflict phase, this negotiation is restarted almost from scratch. In Syria, the new social contract entails transitioning from a state dependent on repression and rent to a state based on legitimate extraction, predictable distribution, and political and economic accountability.

3. Post-Assad Syria: Dissecting the Political Economy of the First Year

3.1 A Destroyed Economy, Not a Contracting One: The Scale of Structural Collapse

The Syrian economy today is not a “contracting” economy in the traditional sense, but an economy emptied of its basic functions. World Bank estimates in its report Syria Economic Monitor: Spring 2024 indicate that the Syrian economy has experienced one of the deepest collapses in modern history. Gross domestic product has contracted by more than 85% since 2010, and the real purchasing power of households has declined catastrophically (World Bank, 2024).

This collapse does not reflect merely a cyclical decline, but structural disintegration in production mechanisms, exchange systems, and fiscal extraction. According to World Bank reports, the collapse has not been limited to domestic output, but has extended to productive capacity, supply networks, human capital, and the relationship between state and society. This disintegration means that recovery will not be automatic, even with improved political conditions.

3.2 Currency as a Mirror of Political Trust

In post-conflict phases, currency becomes a political indicator par excellence. It plays both a symbolic and a material role simultaneously, as it is not merely a medium of exchange, but also an indicator of the state’s capacity for commitment. The weakness of the Syrian pound reflects not only a shortage of reserves or a production deficit, but also the absence of stable expectations. People do not know what bread prices will be in a month, nor whether wages will suffice even for a week.

Post-conflict studies indicate that the loss of economic predictability drives individuals to withdraw from the formal economy, thereby further weakening the state (Collier et al., 2003). Chronic inflation during political transition phases undermines peace through three channels: the erosion of fixed incomes, the reinforcement of the informal economy, and the weakening of the state’s revenue collection capacity.

3.3 Poverty as a Direct Political Risk

Widespread poverty in Syria is not merely a social issue, but a direct factor in political instability. World Food Programme data show that 12.9 million people suffer from food insecurity in Syria, including 3.1 million experiencing severe food insecurity, with a direct link between poverty and local tensions (WFP, 2024).

This situation represents a clear example of what peace researchers call “compound fragility,” where economic shocks interact with social divisions to undermine stability (Walter, 2015). Where unemployment intersects with food insecurity, environments that incubate violence or expand informal economies emerge.

3.4 The Transitional State: Between Dismantling and Building

Transitional authorities face a complex paradox: dismantling the previous regime’s economy without destroying what remains of administrative capacity. In the first year after Assad, transitional authorities confront a dual challenge—dismantling the exclusionary political economy networks constructed by the previous regime while simultaneously building alternative institutions capable of legitimate production and equitable distribution.

Many countries have failed to strike this balance, either by maintaining old networks or by dismantling the state apparatus without providing a viable alternative. The literature warns that this phase is the most dangerous, as old patterns of control recede before new rules crystallize, thereby creating a vacuum that can be filled by informal forces or economies of violence (North et al., 2009).

4. Relatively Successful Case Studies: How Did Economics Serve Peace?

An analysis of “relatively successful” experiences shows that peace was not built through a single decisive moment, but through a series of small yet cumulative economic decisions that reorganized the relationship between state and society. These cases were not ideal; however, they succeeded in preventing a relapse into violence.

4.1 Rwanda: When Discipline Becomes an Alternative to Consensus

When the genocide ended in 1994, Rwanda was not only a poor country, but a functionally disintegrated state. More than half of its administrative cadres were killed or fled, social trust had vanished, and agriculture—the backbone of the economy—had become a paralyzed sector. What distinguishes Rwanda’s experience is not only the speed of growth, but the clarity of its political-economic sequencing.

What distinguishes Rwanda is not merely the speed of recovery, but the logic governing the ordering of priorities. The state did not immediately pursue comprehensive economic reconciliation, nor did it launch broad privatization programs; instead, it focused on one central objective: restoring predictability. The government did not promise democracy first, but stability and measurable results. This choice was controversial, yet economically effective.

The Rwandan leadership understood that the most dangerous post-conflict condition is uncertainty. It therefore implemented strict monetary control, centralized public financial management, and ensured that international aid was aligned with state planning rather than the reverse. The World Bank notes that centralized aid coordination and fiscal discipline contributed to the creation of “stable expectations” among economic actors—an essential element in restoring investment (World Bank, 2020).

This approach generated what North and his colleagues describe as an “institutional equilibrium point,” where compliance with rules becomes less costly than violating them. Citizens did not necessarily experience broad political freedom, but they experienced tangible improvements in services, agricultural income, and infrastructure. This produced what political scientists describe as “performance legitimacy,” whereby society accepts political constraints in exchange for visible improvements in daily life.

Implications for Syria: From a political economy perspective, the Rwandan state compensated for limited political pluralism with high executive capacity, enabling it to achieve tangible results for citizens. In the short term, building executive capacity and economic discipline may prove more critical than expanding formal pluralism that cannot yet be effectively implemented.

4.2 Mozambique: The Daily Economy as a Tool to Prevent Return to War

Unlike Rwanda, Mozambique did not possess a strong state after the 1992 peace agreement. Institutions were fragile and the bureaucracy limited, yet the economic approach was clear in its simplicity: return people to work as quickly as possible. Mozambique did not possess a strong post-war state, but it possessed a clear philosophy—people need work before they need perfect institutions.

The state focused on reopening agricultural lands, implementing labor-intensive rural infrastructure programs, and supporting small-scale local trade. Reopening fields, repairing rural roads, and employing thousands in basic projects effectively created an informal social safety net. This reduced the likelihood of armed remobilization, even under conditions of weak governance.

The government did not wait for comprehensive institutional reform, but instead treated employment as a de facto security policy. This is supported by Collier’s work, which links lower unemployment rates to a decreased likelihood of renewed conflict. World Bank studies confirm that this approach reduced the probability of relapse into war despite institutional fragility (World Bank, 2016). Although growth was uneven and social disparities persisted, peace endured.

Implications for Syria: Large-scale employment is not merely an outcome of peace, but one of its essential conditions. Reviving agriculture, small industries, and local services is not a temporary measure, but a strategic peacebuilding tool. The local economy—particularly agriculture and small-scale industries—should not be treated as a provisional substitute pending large projects, but as a foundational pillar of stabilization.

4.3 Bosnia: Peace That Stopped at Reconstruction

In Bosnia, physical reconstruction succeeded, but the restructuring of the political economy failed. International aid rebuilt cities, yet it did not rebuild the economy. The reason was not a lack of funding, but the absence of a shared political-economic vision. Economic policies were constrained by constitutional divisions, which impeded the emergence of a dynamic private sector.

The complex political system preserved peace, but paralyzed the economy. Roland Paris describes this situation as an example of “liberal peacebuilding without political economy,” in which institutional models are imposed without addressing underlying power relations (Paris, 2004). Here, an important lesson emerges: political stability is insufficient if it obstructs effective economic decision-making.

Implications for Syria: Any political settlement that constrains economic governance in the name of balance may produce peace without sustainability.

5. Case Studies of Failure: How Does Economics Undermine Peace?

5.1 Iraq: When Rent Becomes an Alternative to Citizenship

Iraq after 2003 demonstrated that financial abundance does not guarantee stability. The Iraqi state used oil revenues to purchase stability through salaries and subsidies, rather than through productive investment. This created citizens linked to the state primarily as employees, not as participants in a social contract. Dependence on oil, inflated public-sector employment, and the absence of accountability produced a fragile rentier economy.

When revenues declined or trust eroded, there was no diversified productive base capable of absorbing the shock. Michael Ross argues that reliance on resource rents weakens the state’s connection to society, thereby undermining the social contract (Ross, 2012).

Implications for Syria: Any model dependent on transfers or external resources without developing internal productive capacity is likely to result in chronic fragility.

5.2 South Sudan: Peace Without a State

South Sudan is a stark example of the fact that political independence does not equate to state formation. In South Sudan, the absence of effective fiscal institutions led to rapid state disintegration. The lack of revenue collection mechanisms, budgeting systems, and broader fiscal capacity rendered the state incapable of performing even its most basic functions. The result was a rapid relapse into violence. Peace without revenue collection capacity and organized public spending is inherently fragile (World Bank, 2018).

Implications for Syria: Peace cannot be sustained without a fiscal backbone.

5.3 Libya: Economics as an Extension of Conflict

In Libya, conflict did not end but merely changed form. Uncontrolled decentralization evolved into economic competition among armed groups, confirming that decentralization is not a substitute for the state (World Bank, 2021). In this context, decentralization became a struggle over resources and economic channels. The economy did not function as a tool of peace, but rather as another arena of conflict.

Implications for Syria: Decentralization without coherent national economic coordination poses an existential risk.

6. Toward a New Economic Social Contract in Syria

6.1 Why Cannot the Old Social Contract Be Repaired?

The social contract in pre-war Syria was not a contract in the classical sense, but a coercive arrangement based on three pillars: political repression, economic rent, and the politicization of access to resources. The social contract in post-Assad Syria cannot be a modified version of its predecessor. Neither repression nor rent is sustainable.

This arrangement was not stable even during years of “apparent stability,” but inherently fragile, as the state derived its legitimacy not from economic performance or representation, but from its monopoly of violence. Modern social contract theories indicate that legitimacy is not restored through a return to previous patterns, but through redefining the relationship between state and society on verifiable material foundations (Tilly, 1992; North et al., 2009).

6.2 The Social Contract as Material Exchange, Not Political Discourse

In post-conflict societies, trust is not built through slogans or constitutional promises, but through repeated daily experiences. When a citizen pays a tax, a fee, or even accepts a price increase, they enter into an exchange relationship with the state. If no clear return is visible, legitimacy erodes quickly.

Charles Tilly argues that the modern state was not built through good intentions, but through prolonged negotiation over taxes, services, and protection. According to Tilly, the state is constructed through exchange: taxes in return for services and protection. In Syria, this exchange was severed for decades. In the post-conflict phase, this negotiation must restart almost from zero.

In Syria, a new social contract cannot be built without answering simple yet crucial questions: What does the state collect? What does the citizen receive in return? What occurs when the state fails to fulfill its obligations? Rebuilding this contract requires a fair revenue system, transparent public spending, and genuine economic opportunities.

6.3 Components of the Economic Social Contract

First: Legitimate Extraction. A state cannot build a peace economy without revenue collection capacity. However, revenue collection in post-conflict contexts must be simple, predictable, and fair. Complex or discriminatory taxation is often socially perceived as an extension of extortion rather than a civic obligation. Therefore, a tax system limited in scope and governed by clear rules forms the cornerstone of any new social contract.

Second: Predictable Distribution. Legitimacy does not require generous distribution, but understandable and consistent allocation. When a citizen knows when they will receive a service, subsidy, or wage, levels of social anxiety decrease. Post-conflict studies indicate that uncertainty in distribution is more destabilizing than weak distribution itself (Walter, 2015).

Third: Employment as an Economic Right. In the new social contract, work is not viewed as a privilege granted by the state, but as an economic right. The state does not create all jobs; rather, it creates the conditions that make work possible. This requires protecting small-scale property, facilitating local initiatives, and easing administrative restrictions that impede economic activity.

Fourth: Economic Accountability Before Political Accountability. In transitional phases, full political accountability may be delayed, but economic accountability can begin immediately. Where are resources spent? Who benefits? Why? The experiences of Rwanda and Mozambique demonstrate that daily economic accountability may serve a conflict-calming function even before political transformation is complete.

6.4 Economic Decentralization: Empowerment or Fragmentation?

Decentralization in Syria is a practical necessity, but also a double-edged sword. The experiences of Libya and Bosnia confirm that decentralization without clear national economic rules leads to zero-sum competition among regions, institutional duplication, and resource conflicts.

The new social contract requires executive decentralization within a framework of regulatory centralization: the central authority sets the rules, and regions implement them according to their needs. The local economy requires meaningful authority, but within a coherent national framework.

7. The Way Forward: Strategic Recommendations

Comparative analysis leads to clear conclusions and practical recommendations for the Syrian case:

First: Monetary Stability as a Sovereign Priority. Monetary stability is not a technical choice, but a condition for peace. Without credible monetary policy, investment, trust, and long-term planning cannot be sustained.

Second: Employment Before Demonstrative Reconstruction. Employment is not merely an outcome of recovery, but its engine. Simple, large-scale job creation initiatives may have greater social impact than major projects with limited societal reach.

Third: Aid Through Institutions, Not Around Them. External assistance must strengthen state institutions, not replace them. Bypassing the state weakens its capacity and undermines peace.

Fourth: Building Fair Revenue Capacity. A state that does not effectively collect resources cannot safeguard peace.

Fifth: Controlled Decentralization. The local economy requires meaningful authority within a unified national framework. Legitimacy is built on income and material conditions, not on discourse alone. Local empowerment must operate within coherent national economic rules.

8. Conclusion: Economics as the Language of Peace

Post-war economies rarely collapse suddenly; rather, they erode silently. They seldom fail through a dramatic explosion, but instead deteriorate gradually: unpaid wages, malfunctioning markets, and a state deprived of resources. When people cannot find work, cannot understand price fluctuations, and do not trust institutions, peace begins to erode.

Comparative experience demonstrates that peace is not written in agreements alone, but in budgets, labor markets, prices, and the provision of daily services. Such comparisons reveal that economics is the language in which peace is articulated. Syria today is writing the first line in this language.

In post-conflict transitions, economics is not subordinate to politics, but constitutes its fundamental language, its structural infrastructure, and its most revealing expression.

References

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