Syrian manufacturing industry has several advantages: it has a long history and a strong entrepreneurial base, relatively low wages and a good location to serve large markets in oil-rich neighbours and Europe. It has not, however, performed well. This paper focuses on its record in the 1990s, benchmarking indicators of performance and competitive capabilities against selected comparators. Manufacturing growth has been erratic and probably low; manufactured exports have declined dramatically and its composition has shifted towards primary products.

The demise of the Soviet block, which provided a soft market for Syrian exporters, has exposed their competitive weaknesses. The competitive base of Syrian industry has been eroding. With greater openness, Syria faces enormous challenges in terms of building new technological capabilities to strengthen existing activities and diversifying into more dynamic non-oil manufactured exports