Reconstruction efforts in Syria, Lebanon, Iraq, and Iran will create new opportunities for the Gulf states, Turkey, and other external powers to gain control of key connectivity infrastructure.

The US-Iran War has demonstrated an unexpected paradox. As Iranian missiles struck Ras Laffan—the world’s largest LNG complex and Qatari economy’s crown jewel—Qatari companies and investment funds were laying the groundwork to rebuild Syria’s energy infrastructure. At the same time, as Iranian drones targeted the UAE’s airports, seaports, data centers, and energy facilities, the country’s minister of foreign trade was in Damascus inaugurating the first post-Assad UAE-Syria investment forum, announcing new direct flights, real estate projects, and energy investments. 

Ironically, even as Iran struck critical infrastructure across the Gulf, Qatar, the UAE, and Saudi Arabia were committing billions of dollars to rebuild countries that Iran-backed actors helped destroy. With the Strait of Hormuz effectively closed and the ceasefire in tatters, the United States was working to revive a long-defunct pipeline that would carry Iraqi oil overland through Syria to the Mediterranean, explicitly to reduce reliance on the Strait of Hormuz.

These actors understand that the region’s economic future, and their place in it, will be determined less by the terms of a peace agreement than by who finances, builds, and ultimately controls its infrastructure. We have spent much of the past year tracking reconstruction deals, concessions, and commitments across Syria, Lebanon, and Gaza. 

The sticker price of reconstruction is eye-popping: The World Bank estimates over $200 billion for Syria, $70 billion for Gaza, and $11 billion for Lebanon. Factor in the proposed $300 billion fund to support Iran’s economic rehabilitation—now in serious doubt—and the region could be looking at over half a trillion dollars to rebuild. The question, however, is not whether the money exists. It does. The question is who deploys it, on what terms, and what they get in return.

Diplomats are not signing the most telling agreements in Syria, Lebanon, and Gaza. They are port operating agreements, power purchase contracts, and airport concessions. Whoever locks in these deals will shape the region’s economic corridors—and with them, its balance of power—long after today’s leaders have left the scene. Three distinct reconstruction races (and geopolitical contests) are underway, each offering distinct lessons. In Syria, the early winners are already clear. In Lebanon, the outcome remains contested. And in Gaza, the competition has not yet begun.

In Syria, the early race is over. Before others could mobilize, Qatari and Turkish companies locked in major 30-year deals, including $7 billion in energy and power generation projects that would cover over 50 percent of its electricity needs, and a $4 billion concession to rehabilitate Damascus International Airport.

Through an energy swap with Azerbaijan, Turkey is routing Caspian gas via a repaired pipeline from the Turkish border to Aleppo, powering Syria’s thermal plants and extending the line toward Homs. Qatar financed the pipeline, and has partnered with Chevron to explore Syria’s offshore gas fields, positioning Doha for a potential equity stake in whatever hydrocarbon wealth lies beneath Syrian waters.

Not to be outdone, Saudi Arabia and the UAE have each committed billions of dollars to Syria’s rehabilitation. The UAE’s DP World is now operating the port of Tartous, where Russian warships once docked. Its AD Ports has launched a direct logistics service linking the Emirates to Iraq, even as it looks to build a route from the Gulf to Syria’s Mediterranean ports that would give Abu Dhabi structural leverage over one of the region’s primary trade corridors.

Saudi Arabia is spearheading an initiative with Turkey to modernize the Ottoman-era Hejaz Railway. This overland route would bypass both the Strait of Hormuz and Israel, bridging Turkey to the Gulf via Syria and Jordan. These investments are as geopolitical as they are financial. They are creating new trade corridors in real time, not easily undone by elections or changes of government. In post-conflict investment, speed is leverage.

Lebanon’s reconstruction race is moving more slowly, not between outside powers, but rather between the state and Hezbollah, the terrorist group and social movement that has long subverted it. Even as Hezbollah and Israel fought over the past 20 years, the group curried favor by operating parallel networks of electrical generators and providing direct financial support through its Wa’ad (Promise) Project. 

With its first reform-minded government in over a decade, Lebanon is now moving toward a new IMF program that would restore investor confidence. Still, its banking system remains debilitated by years of corruption and monetary instability. Lebanon is trapped in a reconstruction Catch-22: large-scale investment will not flow until Hezbollah is disarmed, but marginalizing the group requires exactly the kind of sustained investment and institution-building that won’t arrive until investors are convinced it’s already happened. The outcome is far from determined, and the clock is ticking. 

If Lebanon’s reconstruction is slow going, Gaza’s has not even begun. No concessions are being signed, and no deals are being done, other than preliminary rubble clearance, because there is no agreed counterparty to sign them. Almost three years after October 7, Hamas still controls roughly 40 percent of the strip, including the portion housing the vast majority of its approximately 2 million displaced residents. Competing frameworks for “the day after” between the United States, Israel, the Palestinian Authority, Egypt, and others are actually competing governance visions. 

As in Syria and Lebanon, the infrastructure race cannot begin until the question of governance is settled. Whoever breaks that stalemate can set the terms for what follows. For all its flaws, the Board of Peace—Washington’s attempt to fill Gaza’s governance vacuum—might offer the only viable plan thus far. However, Gulf and European capital are not likely to flow if the IDF maintains or expands control over any part of the Strip.

Beyond each internal governance puzzle, exogenous variables might also stymie reconstruction. The Iran war’s long shadow of the Iran war has underscored that Gulf capital, while plentiful, is finite. Vision 2030, Riyadh’s multi-trillion-dollar bet on a post-oil economic transformation, competes for the same sovereign pools as reconstruction commitments; Qatar must rebuild Ras Laffan before it rebuilds Gaza; and all three Gulf states are increasing defense spending given persistent Iranian threats and growing skepticism over US security commitments. The builders have their own bills to pay.

For its part, Washington faces constraints of its own making. The United States took an important step in removing most sanctions on Syria last year and initiated the process of rescinding Syria’s State Sponsor of Terrorism designation. But legal permission and commercial appetite are not the same thing. 

Many Western boards will need persuading that a frontier market governed by a former Al Qaeda affiliate is a good bet, and American companies need to move faster to avoid ceding ground. In post-invasion Iraq, China moved quickly once the fighting subsided, with the state-owned China National Petroleum Corporation (CNPC) becoming the largest foreign investor in Iraq’s oil industry by 2014 and Chinese companies eventually responsible for over half of Iraq’s total oil production, while American companies hesitated and ceded ground.

The winners of this moment will not only be those who prevail militarily but also those who control the ports, own the grids, and operate the airports. The Middle East exemplifies the reality that control of infrastructure has always meant more than commerce. That competition is already underway. Follow the cranes.

About the Authors: Eitan Danon and Josh Kram

Eitan Danon is a former senior policy advisor at the US Treasury Department and analyst in the US intelligence community, both roles focused on the Middle East. He is a strategic advisor for national security at Chainalysis, an adjunct senior fellow at the Center for a New American Security, and co-founder of Riyalpolitik, a newsletter on the economic story of a changing Middle East.

Josh Kram is a former senior official at the US International Development Finance Corporation and former vice president at the US Chamber of Commerce, where he led Middle East programs. He is managing director of Westbrook Global Advisory and co-founder of Riyalpolitik, a newsletter on the economic story of a changing Middle East.

All statements of fact, opinion, or analysis expressed are those of the authors and do not reflect the official positions or views of the US Government. Nothing in the contents should be construed as asserting or implying US Government authentication of information or endorsement of the authors’ views.

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