The value of the Syrian currency fell to a record low on Friday, as it approached 10,000 liras against the dollar.
According to “Syria Pound Today”, a Syrian lira monitoring website, the exchange rate dropped to 9,750 liras per dollar before it rebounded a bit on Friday morning.
Since the end of 2022, the lira has depreciated significantly, which prompted the Central Bank of the Syrian government in February to decrease the official exchange rate consistently in an attempt to bridge the gap between the official and the black market exchange values.
The crisis has been triggered by years of conflict, Western sanctions and a currency squeeze in part due to a financial meltdown in neighbouring Lebanon.
Before Syria's civil war in 2011, the lira traded at about 46 against the dollar.
The central bank decided to devalue the price of the Syrian lira against the main currencies on Thursday, by about 200 liras per dollar and 205.31 liras against the euro.
In a statement, the bank explained that the move was “for the purpose of cash exchange and the purchase of foreign transfers”, whether transferred from Syrian expatriates or international transfer networks.
“The decline in the value of remittances during Eid Al Adha is the reason for raising the price of the dollar and the euro for remittances, as the money entering Syria from expatriate remittances did not reach half of what it was during Eid Al Fitr, about three months ago,” Ali Al Shami, a financial analyst from Damascus, was quoted as saying by Al Araby Al Jadeed.
With the depreciation of the Syrian lira and the rise in the price of the dollar, average wages in government-held areas decreased to $10 per month, while commodity prices increased dramatically, including oil derivatives.
The country's Ministry of Internal Trade and Consumer Protection raised the price of octane 95 petrol by 1,000 Syrian pounds, to 8,600 liras per litre from 7,600 liras, in a third increase in just four months.
The increase comes as local media reports a potential salary increase in the public sector.
The failure of Bashar Al Assad’s government to raise wages has led to mass resignations in the past few months from public sector jobs, according to reports.
Poverty and food insecurity are extremely high in Syria. The World Health Organisation estimated last year that over 12 million Syrians, around 60% of the population, are suffering food insecurity.
Areas of the Syrian regime are experiencing a severe economic crisis, which is represented by a shortage of oil derivatives, a rise in poverty rates to 90 per cent, the cessation of production and industry, and the inability to provide electricity for more than a few hours a day.
The latest blows to the Syrian economy come after the central bank released new 5,000-Syrian lira banknotes into circulation on June 20.
