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3. HTS: From a War Economy to a Fully-Functioning State

After seizing control of most of the Idlib region, Hay’at Tahrir al-Sham (HTS) evolved from a mere Islamist group into a de facto governing authority responsible for millions of civilians. It was thus forced to rebuild an economy ravaged by years of war while also shifting the sources of its internal funding.

Following Jabhat al-Nusra’s split from al-Qaeda and the creation of HTS, the group could no longer rely on its former donors. Moreover, HTS leader Abu Mohammad al-Jolani’s efforts to rehabilitate the group’s international image also hinged on adopting more conventional forms of financing.

From War Spoils to Zakat

From its early days, HTS was largely self-financed, drawing on methods commonly associated with traditional jihadist movements to secure funds — including kidnappings, ransom payments, and smuggling. In 2018 alone, according to a 2021 report by the Middle East Institute, the group is believed to have brought in $149 million through war spoils seized from the Syrian regime and rival opposition factions.

HTS is also thought to have collected at least $94 million through prisoner exchange deals — not only with the Syrian regime but also with foreign states such as Iran and Lebanon. In addition to these agreements, the group generated revenue by charging Iran and Hezbollah for the return of the bodies of fighters killed in battle.

In 2013, Jabhat al-Nusra was known for looting historical sites and smuggling archaeological artifacts. HTS is believed to have carried over these methods in the early stages of the group’s formation. According to National Public Radio, the group is also reported to receive donations from wealthy Syrians living abroad who have long opposed Bashar al-Assad.

With the establishment of the Syrian Salvation Government (SSG) in the northwest of the country, HTS began to develop more traditional financial resources. According to HTS expert Aaron Y. Zelin, the SSG set up a full bureaucracy, offering services such as census taking and issuing identification papers, in addition to providing water and electricity. In exchange, the government introduced taxes, including "zakat," a specific tax on production.

Zakat (charity) is imposed on farmers and business owners, such as merchants, with the amount varying based on production. Initially collected by the religious police, zakat was later managed by the Zakat department within the SSG.

For example, according to a report from the Middle East Institute, in August 2019, a decree was issued requiring farmers to pay 5% of the total value of their harvest as tax, under threat of imprisonment. Then, in November of the same year, another decree ordered olive producers to pay either 10% of their harvest or 10% of the olive oil they produced.

In addition to production taxes, HTS introduced rental fees for displaced persons living on public land. As of September 2020, the annual rent for a tent was set at 50 Turkish lira. The SSG also forbade citizens from buying or selling land or property belonging to the state.

According to a 2020 report by the Washington Institute, between late 2018 and late 2019, HTS seized homes and properties from individuals it labeled as “apostates” or “shabihas” — vague terms encompassing religious minorities who had fled the region, as well as anyone with ties to the regime. In one case, at least 550 homes and shops belonging to Christians in the city of Idlib were confiscated.

Shiite villages such as al-Fua and Kafarya were also targeted under this policy. In addition, several hundred properties belonging to Syrian army recruits, government employees, and members of the Baath Party were seized. This system allowed HTS to reward its members by granting them homes or plots of land.

The capture of the Bab al-Hawa border crossing in July 2017 marked a turning point in the group’s finances. HTS significantly benefited from the introduction of customs duties on goods and merchandise — including both humanitarian aid deliveries and commercial trade. Experts estimate that the group collects between $3 and $7 per ton of goods, generating monthly revenues of $10 to $15 million. Additional taxes are also imposed at each checkpoint across the region.

These revenues have enabled HTS to pay its fighters' salaries, acquire weapons, and set aside funds for future battles.

Revitalizing Idlib's Economy

With the establishment of the SSG, Idlib’s economy has gradually begun to recover, thanks to a series of measures. Starting in June 2020, the Syrian pound was replaced by the Turkish lira to address the sharp depreciation of the Syrian currency.

Meanwhile, the group's monetary agency decided to ban the purchase of Syrian pounds and cash transfers to and from regime-controlled areas. Additionally, they began issuing licenses for exchange offices and money transfer services to ensure compliance with their directives.

“The economy in Idlib was better than in regime-controlled areas, which have been affected by both sanctions and corruption,” says Thomas Pierret, a researcher at CNRS and Syria specialist, in an interview with This is Beirut. He adds, “In Idlib, the economy was not subject to sanctions and benefited from its proximity to Turkey, which provided support for infrastructure, including electricity and internet.”

HTS specialist Aymenn Jawad al-Tamimi offers a similar observation, noting: “Near the Bab al-Hawa border crossing, there are numerous car dealerships and other businesses, with expansion projects underway, including an industrial zone. Likewise, the city of Sarmada, located north of Idlib, is known for being a popular shopping destination for residents of neighborhoods of Aleppo that were once under regime control.”

However, they also highlight the presence of many people in refugee camps who were heavily dependent on international aid. A Syrian HTS expert, speaking anonymously, estimates that "in recent years, HTS has built shopping centers in Idlib, decorated some streets, and improved a few intersections to create an illusion of prosperity, but only a minority of residents had access to these areas."

“The remainder of the population lived in dire conditions, whether in the camps — housing over a million people — or elsewhere. Most people lived below the poverty line, with limited job opportunities, low wages, and high rents,” he adds.

A Monopolized Economy

A report from the Middle East Institute reveals that Moustafa Qadid, who heads HTS's economic strategy, plays a central role in the group's control over Idlib's economy. As the head of HTS’s economic department, a separate entity from the SSG, he has restructured the money exchange and transfer sector by establishing Al-Waseet, a company that imposes taxes on all businesses within the sector.

Qadid is also in charge of the General Monetary Agency, created in 2017 to oversee treasury management and consumer protection, which is responsible for issuing licenses to exchange offices. The Middle East Institute reports that Al-Waseet’s capital exceeded $30 million before it was converted into Sham Bank in 2018.

After Turkey's Operation Olive Branch in 2018, which resulted in the Turkish military gaining control of the Afrin region, Qadid founded Watad Petroleum. This company handles the trade of oil derivatives in the region, following the disruption of oil supplies from the Syrian Democratic Forces (SDF). Watad Petroleum was granted exclusive rights to import petroleum and gas derivatives from Turkey.

In partnership with the SSG, Watad Petroleum is tasked with regulating the prices of gas and oil distribution in Idlib. By June 2019, the company was generating a monthly profit of $1.67 million.

However, Watad Petroleum’s monopoly on the market led to significant discontent in Idlib, causing business closures and driving up oil prices. To address this, two additional companies — Kaf Company and Al-Shahba — were established in the region in December 2020. Although these companies disrupted Watad’s monopoly, many residents of Idlib still believe they are controlled by Qadid.

In 2020, HTS introduced SYR Connect, establishing a monopoly on internet services. The company became the sole provider and distributor of internet access in northwest Syria.

The imposition of excessive taxes and the growth of monopolies fueled dissatisfaction among parts of the population. Many viewed the taxes as a form of extortion, believing they served little purpose other than to worsen living conditions.

However, the region’s proximity to Turkey and the absence of international sanctions allowed it to access better services than neighboring areas, although it remained limited by the realities of a war-torn economy.