Syrian Pound Sees Unexpected Recovery Post-Regime Change
In a surprising turn of events, the Syrian pound has shown signs of recovery against the US dollar following the recent overthrow of President Bashar al-Assad. Reports indicate that the exchange rate improved significantly in regions like Idlib, where the pound traded at around 9,000 to 10,000 liras per dollar, contrasting sharply with the capital, Damascus, where rates hovered between 10,000 and 12,000 liras. This shift comes as foreign currency begins to flow more freely into the markets, marking a notable change in the economic landscape of Syria.
As the opposition forces advanced towards Damascus, the parallel market exchange rate peaked at a staggering 30,000 liras per dollar, a stark increase from the previously stable rate of 15,000 liras. The Central Bank of Syria has set an official exchange rate at approximately 12,562 liras per dollar, reflecting the ongoing volatility in the currency market.
Factors Contributing to the Currency's Improvement
Experts attribute the recent strengthening of the lira to a combination of political and economic factors. Qusay Ibrahim, an economics professor at Damascus University, noted that the influx of dollars from Idlib and other opposition-controlled areas, alongside remittances from Syrians abroad, has played a crucial role in stabilizing the currency. Furthermore, the gradual return of displaced Syrians to their homeland post-regime change has contributed to the improved economic sentiment.
Historically, the Syrian pound has faced severe devaluation, losing over 90% of its value since the onset of the civil war in 2011, when the dollar was valued at approximately 50 liras. The recent developments mark a significant departure from the norm, where currencies typically collapse following a regime's fall.
Changing Legal Landscape and Market Dynamics
Until recently, Syrian law strictly prohibited transactions in foreign currencies, imposing severe penalties for violations. This legal framework led to a culture of fear among traders, who avoided discussing the dollar openly. However, the current economic climate has prompted a shift, with merchants now openly displaying prices in multiple currencies, including the dollar and Turkish lira. This newfound flexibility in currency transactions reflects a broader change in the economic environment as the country navigates its post-regime reality.
Despite the positive signs for the Syrian pound, the United Nations warns that the humanitarian situation remains dire, with 90% of the population in regime-controlled areas living below the poverty line since 2021. The ongoing economic crisis continues to pose significant challenges for the Syrian people as they adapt to a rapidly changing landscape.
