Syria leans on exchange bureaus to save plummeting pound

 10 May 2016 - 16:37

Syria leans on exchange bureaus to save plummeting pound
 


Damascus: Syria's central bank on Tuesday ordered exchange bureaus to buy millions of dollars from it, state media said, to boost a currency at its lowest value in the five-year war.

"The central bank ordered large exchange bureaus to buy $1 million and smaller bureaus to buy $100,000," the SANA official news agency reported.

"Those that do not comply will be closed."

The official exchange rate jumped by more than 20 percent to 620 pounds against the dollar from Monday to Tuesday, following the rate on the black market.

"The central bank obliges exchange bureaus to sell dollars for 620 Syrian dollars without commission," SANA added.

Jihad Yazigi, head of The Syria Report, said the measure could in part be explained by "the rumour that it would no longer do so because of a lack or reserves".

Last month the World Bank said Syria's foreign currency reserves had dropped to $700 million at the end of last year from $20 billion at the start of the war in 2011.

"The measure will temporarily calm down the situation but the exchange rate will increase if the central bank doesn't regularly water the market with green bills," Yazigi said.

"It's an injection of only several millions of dollars because there are only five big exchange bureaus in Damascus."

As well as devastating the economy, Syria's conflict has killed more than 270,000 people and displaced millions.

AFP