Syrian lira in free fall after 'Assad-Makhlouf' dispute

Syrian lira in free fall after 'Assad-Makhlouf' dispute
The Syrian lira has been severely dented by the coronavirus lockdown, sanctions, and now a domestic dispute.
2 min read
06 May, 2020
The Syrian pound has hit record lows [Getty]
The Syrian lira continued its free fall this week after reports of a major rift in the upper-echelons of the Syrian regime, Zaman Al-Wasl reported on Wednesday.

The US dollar was trading for around 1,350 liras on the black market in Damascus this week, compared to 48 pounds in March 2011, the month the revolution in Syria began, eventually spiralling into a devastating civil war.

Syria has been hit by war, sanctions, and civil unrest in Lebanon which have combined to diminish the value of the lira - also known as the pound - against the dollar.

It has seen the price of basic goods skyrocket, putting essentials out of reach of many ordinary citizens while the middle class have seen the value of their savings plunge.

The Syrian regime has attempted to remedy this with tough measures, including a maximum sentence of seven years jail and hard labour for anyone caught dealing in any other currency than the lira.

Since then, the currency has plunged further due to coronavirus' lockdowns battering the economy and now an alleged dispute between two of Syria's most powerful figures.

Rami Makhlouf, a tycoon and cousin of Bashar Al-Assad, made two unprecedented appeals via Facebook that the government was "unfairly" targeting his businesses.

Mahklouf - who is said to control as much as 60 percent of the Syrian economy through his business empire - said that he was being issued multi-million dollar fines and that his employees were being arrested.

He appealed to Assad to stop the harassment by intelligence divisions or his businesses could go under, although analysts believe that the president is almost certainly behind the campaign.

Makhlouf - who has links with pro-regime militias - also appeared to make a coded threat to Assad about the prospect of internal strife if the campaign continues.

Such uncertainties about the future of the country and the cash-strapped economy have dogged the lira, despite Assad's forces turning the tide of the war in the regime's favour from 2016.

Assad himself acknowledged the challenges from the economy and coronavirus in a speech on Monday, speaking of a potential "catastrophe".

"In tandem with the health challenge, the other challenge during the coronavirus pandemic and even before is the economic challenge," Assad said.

"Citizens from different segments of society have been forced to choose between hunger and poverty... or illness."

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