Syrian pound continues to plunge to new lows, rattling Assad regime

The Syrian pound has continued its steady decline over the past week, leading to the government to enact tough emergency measures in an attempt to rescue the declining currency following signs of unrest.

Over the past week, the currency has lost around a third of its value, with the Syrian pound trading on the black market at around 1,170 to the dollar on Saturday, a record low.

The declining pound and poor economic situation sparked protests in regime-controlled areas.

It Suweida, a Druze-majority province, there were demonstrations last week against the deteriorating economic situation in the country.

The weakening pound has meant that imported goods have become increasingly out of reach for much of the population.

— Jennifer (@JennRollins1002) January 13, 2020" style="color:#fff;" class="twitter-post-link" target="_blank">Twitter Post Syrian pound achieved a record in its collapse against the dollar today (the exchange (1 $ = 1025 SP). You can imagine the scale of tragedy and catastrophic living situation that civilians face! The pic is from one of the lines of oppression in a Syrian governorates #Daraa #Syria pic.twitter.com/qe4MxCuive — Jennifer (@JennRollins1002) January 13, 2020

Although the protesters in Suweida have stressed that the demonstrations were not aimed at Bashar Al-Assad himself, but the regime appears to have been rattled by the rare vocal criticism of the way the country is governed.

Read also: Banking in Lebanon is not paying off for Damascus

On Saturday, Assad announced strict penalties - including hard labour - for customers and traders using any currency other than the pound for transactions inside Syria.

The regime has also mobilised supporters online with the campaign "our lira [pound], our pride" to encourage people to use the Syrian currency rather than dollars or gold.

One factor behind the currency crisis is that many Syrians keep their savings in neighbouring Lebanon, which unlike Syria is not subject to sanctions. 

But banks in Lebanon have enacted capital controls, with limits to how many dollars customers can withdraw, meaning fewer dollars are heading over the border to Syria.

More than 80 percent of the Syrian population live below the poverty line, according to the UN, while prices for basic goods are rapidly increasing.

Meanwhile, huge swathes of the country remain destroyed or heavily damaged due to regime bombing and shelling.

War, poor security and rampant corruption mean that Syria's economy is unlikely to improve, while the regime is said to be heavily indebted to war-time allies Iran and Russia.