seven sources and documents reviewed by Reuters reveal that Syria will issue new banknotes and remove two zeros from its currency, in an attempt to restore confidence in the pound, which has been severely devalued.
The move aims to bolster the Syrian pound after its purchasing power collapsed to unprecedented levels following the 14-year conflict.
The Syrian pound has lost more than 99% of its value since the outbreak of war in 2011, with the exchange rate now standing at around 10,000 pounds to the dollar, compared to 50 pounds before the war.
The sharp decline in the value of the currency has made daily transactions and money transfers more difficult.
When buying their weekly groceries, families typically carry black plastic bags containing at least half a kilogram of 5,000-lira banknotes, the current highest denomination.
According to a document seen by Reuters, the Central Bank of Syria informed private banks in mid-August that it planned to issue a new currency with “zeroes removed,” in an effort to facilitate transactions and improve monetary stability.
Reuters spoke with five sources at commercial banks, a source at the central bank, and a Syrian economic official, who said the central bank later informed them that two zeros would be removed. They requested anonymity because the decision has not yet been announced.
Deputy Governor of the Central Bank, Mukhlis al-Nazer, chaired meetings on reforming the lira, according to sources at commercial banks who attended the meetings.
The supervisor did not respond to a request for comment. Amal Al-Masry, director of the Government Delegation to Banks at the Central Bank, declined to comment, saying the matter was strictly confidential. The Syrian Ministry of Finance also did not respond to a request for comment.
It remains unclear whether the lira’s revaluation will require legislative approval. Syria is scheduled to hold its first elections for a new legislative council in September.
Two bankers and another Syrian source familiar with the matter told Reuters that Syria had agreed with Russia’s state-owned currency printing company, Goznak, to issue the new banknotes.
They added that the agreement was reached during a high-level Syrian delegation’s visit to Moscow in late July. Goznak did not respond to requests for comment.
