[ad_1]
Damascus – Traders and bankers said the Syrian pound plunged to an unprecedented low on the black market on Wednesday due to the impact of problems facing its counterpart in Lebanon, where the two countries have extensive trade and banking relationships.
Traders said the cost of buying a dollar on the street has turned around four thousand pounds today, after eager traders followed the collapse of the Lebanese pound to a new low of ten thousand against the dollar on Tuesday.
Two major licensed currency traders in Damascus said the Lebanese currency’s slide dealt a psychological blow to the traders of its Syrian counterpart, which has already seen a rapid decline in recent weeks.
The lira has plunged about 40 percent this year alone.
Thousands of Syrian pounds, the cost of buying a dollar on the black market, due to the collapse of the Lebanese pound
“Entrepreneurs and merchants are concerned about fears of unstoppable decline in the coming days, and are waiting if the unrest will increase in Lebanon and its impact on transactions in the outside world,” said one of the merchants, requesting anonymity. .
Syrian investors and entrepreneurs hold billions of dollars in deposits in crisis-ravaged Lebanese banks that have for years been a safe haven for investors fleeing sanctions and strict restrictions imposed by the government.
The Lebanese crisis has put pressure on a major source of dollars for Syria, further damaging a crippling currency from years of Western sanctions and a devastating conflict that has been going on for nearly a decade.
The Syrian pound’s latest collapse came last summer, when it hit a psychological barrier of 3,000 pounds to the dollar, fearing that the tightening of US sanctions would worsen the economy.
The fall of the lira affected business activities, with many merchants and business companies reluctant to buy or sell in a country where many turn to dollar savings to preserve their money.
One banker said the state’s withdrawal of foreign exchange from already depleted reserves to pay for large multi-billion dollar imports of basic goods and fuel has increased the pressure.
It added that the authorities’ reluctance to intervene to protect its foreign exchange reserves had put pressure on the lira. He added that there are other pressures derived from a sharp decrease in remittances from abroad, which represent an important source of foreign currency, from tens of thousands of Syrians residing in countries affected by the Covid-19 pandemic.
The collapse of the lira has led to high inflation and exacerbated difficulties as Syrians struggle to provide food, electricity and other basic necessities. The lira was trading at 47 to the dollar before the outbreak of protests against President Bashar al-Assad in March 2011.
Although the security situation in the country has improved a lot in the last two years than a few years ago, the economic situation has worsened significantly, especially in 2020 due to the economic sanctions imposed on Syria, the deterioration of the situation in neighboring Lebanon, and the spread of the new Corona virus.
Several Syrian-led industries have come under attack, including those related to infrastructure, military maintenance and energy production, and the law also targets individuals and companies that provide financing or assistance to the Syrian government.
The United States has also recently imposed a new round of sanctions on Syria, targeting the Central Bank of Syria and blacklisting many individuals and entities to crack down on the Syrian government.
