US Sanctions, subject to yearly review every May, on Syria came into effect in May 2004 when Bush choose two of six-potential options. Last year, he opted for disallowing Syrian aircraft to use US Airspace. Since they do not anyways, it was seen as choosing one of the more toothless options.
The other option Bush renewed Thursday is the mandatory ban on US exports to Syria (with the exception of some medical and food supply for humanitarian purposes).
When I was in Damascus in February/March in the wake of the Hariri assassination, speculation was rife among Syrian analysts that Bush would renew existing sanctions and add the Foreign Direct Investment (FDI) option. So the fact he did not add any new ones is telling. Damascus is displeased with the renewal of sanctions and denounced them as having a pro-Israeli leaning.
Of the existing options at Bush's disposal, only one is really applicable (FDI).
The reasons the other options are not appealing are:
Restricting Syrian diplomats movement to a 25-mile radius of their work in the US would be countered with similar restrictions made on US diplomats by the Syrian government. Forget the Syrians, if they did this to US diplomats, there could be a revolt from the embassy in Damascus.
Freezing Syrian government assets is tricky legally to do and is essentially a bureaucratic nightmare.
Reducing diplomatic contact with Syria is well....Margaret Scobey, the Amb in Damascus, has been in Washington on "consultations" since the end of February. This one is actually just poorly worded.
What this means in the grand scheme of things, I am not sure. The sanction that is in place regarding American exports has not hurt the Syrians a great deal because of the smuggling from Lebanon. The only sector it has hit is petroleum. Now with the Syrian out of Lebanon (the UN was happy with the withdrawal), the question is will the smuggling continue just without the oversight of the military and mukhaberat.