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Syrian central banks have flew with fresh banknotes from Russia to alleviate a serious cash shortage that has struggled to function.
The central bank said on Friday that the Syrian pound had arrived from Russia to Syria “through Damascus International Airport” but did not confirm the amount of currency. Cash was needed badly after bankers and businesses said the shortage was severely hindering business.
The flight highlights the area of continued reliance on Russia on Syria’s new government. This forces them to negotiate delivery from the country closely allying with Bashar’s overturned regime, as it faces difficulties in procuring banknotes from the West due to sanctions on the state. Al Assad.
Textile manufacturers and retailers who asked not to name the textiles said the shortfall reached the point that “people stopped putting money in the bank because they worry they won’t be able to take it out.” .
Rumors have spread on Syrian social media about the arrival of the enthusiastic, highly anticipated memo, but the central bank said on Friday that “the numbers circulating about the size and volume of this money are completely inaccurate,” and will check out more. Without saying that it was “completely inaccurate.”
Foreign Minister Asaad Al-Shaibani told the Financial Times last month under Assad’s government, the central bank would order print currency from Russia if necessary. Goznak, a state-run Russian printer, provides memos. This should always be replaced.
Western banknote printers are unable to fill up supplies immediately, and banknote experts say they have left a new government that is currently dependent on Goznak, in light of continued sanctions on the country. They are reluctant to provide cash to Syria.
It also remains unclear whether the new regime is trying to remove Syrian banknotes from circulation. One of the two most widely used notes, the 2,000 Syrian pound bill boasts the image of Assad, who currently lives in Russia.
Although the central bank lifted its temporary withdrawal restrictions at the end of last month, business and retail clients seeking cash from the banks are still frequently out of reach.
Some private banks have received $600 million (approximately $65,000 on the widely used black market) daily from central banks for several weeks for recent weeks.
According to businessmen, the amount is close enough to float the company. Manufacturers and traders are unable to access most of their bank deposits and pay their suppliers and salaries.
“Traders have been paying employees from (cash) reserves, which have been working for two months, how long can they last?” said one banker.
Interbank transfers are still available, and businessmen sometimes use this method to buy and sell goods.
The impact of the cash shortage is exacerbated by a lack of information about the number of Syrian pounds in circulation.
Unlike most central banks, Syria does not produce weekly statements containing details about the amount of bills in circulation. The website is inaccessible and is increasing the opacity surrounding its operations.
Banknotes are often destroyed, excluded from the circulation every day due to wear and tear, and central banks around the world are constantly replenishing stocks.
Two years ago, private banking systems in Syria were primarily used for commercial purposes, with citizens tending to hold their own cash.
When the regime began requesting financial information from a few private banks in Syria to apply ad hoc taxes to large-scale revenue players, the trend of those escaping the banking system until the collapse of Assad grew.
Syrian economy had already been crushed by 13 years of civil war, widespread corruption under Assad’s regime, and Western sanctions, including the banking sector.
The companies say their sales plummeted despite the widespread euphoria that marked Assad’s expulsion. Some have been under pressure since export restrictions were lifted. This means that you will have to lose your existing stock and sell it.
“People don’t spend because they don’t know what’s going to happen,” the textile businessman said. “The company is not spending because there is no cash income. The main priority is paying employees.”
Meanwhile, the Western government maintains most sanctions on Syria and its banking sector. Some officials, including the EU, have created road maps to ease measurements in stages.
“There are some indications of confusion and lack of clarity,” said Jihad Yazigi, editor of the news outlet Syria Report. “The economy is a big problem. A key test of the new authorities in Damascus is (a) ensuring a stable supply. Energy and bread, more generally, the economy will restart. I guarantee it.”
