The United States has quietly approved a Qatari initiative to finance salaries for Syrian public-sector workers, marking a significant shift in Western engagement with post-Assad Syria, according to three sources familiar with the matter.

The funding plan—cleared by the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC)—is expected to enable a gradual salary increase of up to 400% for over a million Syrian civil servants, offering critical relief to a country crippled by 14 years of war, sanctions, and decades of economic mismanagement.

A Syrian financial source confirmed that the Qatari funds would start flowing next month, under strict conditions that exclude the interior and defense ministries, in line with Western concerns over the fundamentalist background of the new Syrian leadership.

The move reflects a notable, if cautious, softening of U.S. policy, which had remained largely frozen under sanctions dating back to former President Bashar al-Assad’s rule. The current government, led by President Ahmed al-Sharaa, has sought to distance itself from its Islamist origins under Hayat Tahrir al-Sham (HTS), which deposed Assad last year.

While Sharaa has not fully convinced Western capitals of his political transformation, the Biden administration's January sanctions exemption—and now Trump’s continuity of that policy—has opened space for Gulf Arab states to provide economic lifelines. In April, Saudi Arabia and Qatar jointly repaid Syria’s debts to the World Bank, enabling renewed access to international financial assistance.

Qatar, which had been reluctant to act without a U.S. greenlight, is now expected to finalize the payment plan once it receives written confirmation from OFAC. Diplomats familiar with the discussions said this could come within days.

The Qatari initiative aligns with Syria’s newly launched free market reforms, a break from decades of protectionism under Assad. The Syrian government plans to complement the Qatari-backed salary increase with domestic funding for other employees not covered by the deal.

Despite progress, ambiguity over the broader U.S. sanctions regime continues to challenge efforts by international stakeholders to engage with Damascus. Humanitarian and financial institutions have requested clearer exemptions to avoid violating U.S. law.

Western officials remain wary of Syria’s security apparatus, even after the official dissolution of HTS in January. The group emerged from Jabhat al-Nusra, formerly al-Qaeda’s affiliate in Syria, and remains a sticking point in policy deliberations.

Economic revitalization remains at the core of Sharaa’s administration. With 90% of Syrians living in poverty, according to UN data, rebuilding state institutions and restoring public confidence are viewed as essential for national recovery.

The Qatari initiative may serve as a test case for future international engagement with Syria—one that balances economic stabilization with enduring security and human rights concerns.

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