Abu Dhabi, UAEMonday 28 September 2020

Syrian money changers persecuted as currency crashes

Authorities arrest dollar users, blame steep falls in Syrian pound value on speculators

Syrian authorities closed more than a dozen money exchange shops in Damascus this week and arrested people using dollars.

Official media said the actions are aimed at preserving the Syrian pound.

The measures mark a return to coercion under a command economy that had plagued Syria for decades, before a limited opening in the early 2000s mitigated some of the effects.

Fourteen currency shops were closed in Damascus and people were arrested for exchanging money and for illegal money transfers, according to official media.

Sana, the official news agency, said other arrests were made in the coastal city of Tartus for “the criminal act of using currency other than the Syrian pound”.

The interior ministry said in a statement it “intensified patrols in pursuit of crimes relating to dealing with foreign currency and those who play with the exchange rate”.

The official language echoes an era before money exchange shops were allowed in Syria in 2006, when dollar holders were arbitrarily arrested as regime associates ran the black market.

The value of the pound fell sharply since Lebanon’s financial crisis in October and tougher US sanctions on Syrian President Bashar Al Assad’s regime last month.

The pound was trading around 1,000 pounds to the dollar on the black market in Damascus on Wednesday, compared with an official rate of around 700 pounds.

On Sunday, a presidential decree increased fines for spreading what it termed falsehoods that undermine the Syrian pound, on top of jail terms.

Another decree raised jail terms to up to seven years for using the dollar, reviving Soviet-style laws from the command economy era under Assad’s father, the late Hafez Al Assad.

The head of the central bank, Hazem Qarqoul, told official media on Tuesday that the decrees “will deprive speculators from the opportunity to reap profits and broadcast false news about falls in the value of the pound.”

He cited factors he cannot disclose that assert “we can say that we are doing well.”

The black market rate touched 1,200 pounds to the dollar last week, compared with 630 before capital controls were imposed in Lebanon in November, depriving Syrian regime areas of a main dollar source.

At the outbreak of the Syrian revolt in March 2011 against five decades of Assad family rule the pound was trading at 50 pounds to the dollar.

Updated: January 22, 2020 07:37 PM

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