Kathmandu— The United States has removed Syria from its list of “State Sponsors of Terrorism,” according to a statement released Monday by the US Treasury. The decision rescinds a designation that had been in place for decades, dating back to the rule of the previous Assad regime. This move also includes revoking the terrorist designation of Hayat Tahrir al-Sham (HTS), formerly led by current Syrian President Ahmed al-Sharaa, and was initially revealed last month following a review by Congress. The US anticipates this action will encourage investment in Syria as it seeks to reintegrate into international markets and promote stability.

Economic Implications of Delisting

The removal of the state sponsor designation is expected to remove significant impediments to foreign investment in Syria, potentially bolstering its economy. Restrictions on US foreign assistance, defense exports, and financial transactions previously hindered economic growth. Safwat Raslan, governor of Syria’s central bank, celebrated the decision as “a historic step that restores the country to its natural place in the global economic system,” stating the bank is focused on developing a modern financial infrastructure.

Mohammed Barnieh, Syrian Finance Minister, described the move as “a major and historic success for Syrian diplomacy”, adding it would strengthen Syria’s integration into the global economy and attract investment. The US had previously lifted sanctions on Syria in June 2025, aligning with similar actions taken by the European Union.

Political Context and Regional Shifts

The decision follows a period of perceived positive change within Syria under President al-Sharaa, who has reportedly engaged in diplomatic efforts with Western powers including meetings with US President Donald Trump and French President Emmanuel Macron. These interactions are described by some experts as a “charm offensive” aimed at improving international relations.

The move also acknowledges the transformation of HTS, formerly al-Qaeda’s official branch in Syria, under al-Sharaa's leadership. The group removed former President Bashar al-Assad in December 2024 following an offensive. US envoy to Syria Tom Barrack hailed the end of the designation as a “decisive step” in Syria’s transition from isolation and source of terrorism to a committed global partner.

Treasury Department Rationale

According to Treasury Secretary Scott Bessent, today's action is intended to foster additional investment in Syria and promote both political and economic stability. He stated the decision aligns with President Trump’s commitment to providing sanctions relief to the country.

The US announcement follows a period of review and assessment of Syria’s progress towards regional stabilization and counter-terrorism efforts.

The delisting is already being celebrated by Syrian financial officials, who anticipate increased investment and integration into the global economic system. Further developments are expected as Syria seeks to capitalize on this renewed international standing.

(With inputs from Al Jazeera)

Originally published on abcnews.com.np.