Syrians Turn to Turkish Lira After US Sanctions Prompt Currency Crisis

Residents in the northwestern regions of Syria living under the control of the Syrian opposition have begun using Turkish liras in their daily commercial transactions in order to avoid large financial losses following the devaluation of the Syrian pound (SYP) against foreign currencies.

On June 16, the dollar exchange fell to SYP 3,200 at the time of editing. 

Devaluation of the Syrian currency began after the United States passed new sanctions against Syria and anyone who aids the government of Bashar al-Assad. The sanctions took effect on June 17.

"The exchange rate of the Syrian pound against foreign currencies has caused instability in the region and this has weakened the purchasing power of people who are paid in the Syrian currency,” Dr. Abd al-Hakim Al-Masri, Minister of Finance and Economy in the Provisional Syrian Government in the opposition regions, told IranWire.

"It was necessary to find an alternative to dealing in Syrian pounds in light of the losses incurred by some exchange bureaus and shop owners," Al-Masri added, noting that using Turkish liras would be a temporary measure pending the "fall of the regime." The measure was being taken to avoid the regime's economic crises from being reflected onto areas outside of its control, according to Al-Masri.

Regarding the reason for choosing to use Turkish liras, the minister said: "Most of the institutions affiliated to the provisional government pay their employees' salaries in Turkish liras, including local councils, teachers, police, and security personnel, in addition to the ease of obtaining Turkish lira coins."

Shops in Syrian opposition areas have started pricing food and basic commodities in foreign currencies, either in US dollars or Turkish lira, in an attempt to reduce losses as much as possible.

Abu Muhammad, a shop owner in the city of Azaz in the northern countryside outside Aleppo, told IranWire that the Syrian pound's low exchange rate has caused large financial losses, and therefore he has decided to close his shop until the exchange rate stabilizes a little, indicating that it is not reasonable to sell at one price and buy dollars at a higher price.

Turkish Postal Centers (PTT) have started dispensing Turkish lira coins through their centers spread across the northern and eastern areas outside Aleppo, where they are obtained in exchange for US dollars only. Some exchange bureaus and local banks in Idlib have also worked to bring in coins and small denominations of Turkish lira to pump into such areas.

The Syrian currency began to lose its value significantly after US President Donald Trump signed the Caesar Syria Civilian Protection Act, following its approval by the US House of Representatives and Senate on December 20, 2019.