Syrian pound rises by 30% after Trump's sanctions announcement, amid hopes for economy

US President Donald Trump’s announcement that he would end sanctions on Syria was met with widespread celebrations in the country and translated into a 30 percent rise in the value of the collapsed national currency, the Syrian pound.

The Syrian pound or lira rose to 8,500 against the dollar on the black market on Thursday, its best level since 2023.

The dramatic improvement caused some confusion in Syrian markets, with some traders refusing to accept dollars as their relative value declined and doubts over whether the improvement in the Syrian pound can be sustained amid continued economic recession, despite the optimistic political developments.

Following the lifting of sanctions, Syrian Finance Minister Yisr Barnieh called on investors to do business in Syria.

"Syria today is a land of opportunities, with immense potential across every sector - from agriculture to oil, tourism, infrastructure, and transportation," he told Reuters, adding that he wanted a "central role" for the private sector in the Syrian economy and its integration into the global financial system.

However, he cautioned that the lifting of sanctions was "not the final chapter" and that more work was needed to create real economic progress in the country.

While Trump has promised the removal of sanctions, he has not set a timetable for this, while the US's stringent Caesar Act sanctions, imposed in 2019, require Congressional approval to be lifted.

Anas Al-Fayoumi, an economic analyst, told The New Arab’s sister site Al-Araby Al-Jadeed that the Syrian pound's rise against the dollar was still "fragile" and tied to political developments, adding that the Syrian government should move to make real economic gains.

He said that genuine economic progress depended on confidence in the Syrian market and an increase in foreign investment and capital flows. while a complete lifting of sanctions would greatly increase the value of the Syrian pound, as would an increase in the flow of foreign currency and foreign aid.

Al-Fayoumi however pointed out that even in this optimistic scenario, gains would be modest due to the destruction of infrastructure caused by the 13-year Syrian conflict and the lack of institutional reform in the country.

Before the Syrian conflict broke out in 2011, the exchange rate was 59 Syrian pounds to one US dollar, but the value of Syrian currency fell dramatically as the brutal Syrian conflict raged on and Western nations imposed economic sanctions against the regime of former dictator Bashar al-Assad.

In 2023, it fell to 12,000 Syrian pounds against the dollar, amid a stifling economic crisis. Syria's GDP shrank by 85 percent from 67.5 billion dollars in 2011 to 9 million in 2023, amid a massive increase in the poverty rate to around 80 percent.