Damascus, Oct. 14 (SANA) Stabilizing the Syrian pound will require stronger domestic production and exports, tighter control of inflation and the money supply, and increased foreign currency inflows through official channels, economists told SANA, warning that exchange rate measures alone cannot ensure lasting stability.
The experts identified five priorities: boosting production and exports, controlling inflation and liquidity, regulating the foreign exchange market, strengthening banks and remittance channels, and improving the investment climate.
Production and trade imbalances
Economic adviser Ziad Ayoub Arabche said sustainable currency stability depended on addressing the trade deficit, pressure from the public budget deficit and the widening gap between prices and citizens’ purchasing power.
He said the dollar had risen to around 140 Syrian pounds on the parallel market after fuel prices increased, while the rate announced by the Central Bank of Syria remained lower, reflecting a persistent gap between official and parallel-market rates.
Higher energy and production costs, combined with weakening purchasing power, were encouraging people to buy dollars to protect their savings, Arabche said. Any improvement in the exchange rate could prove temporary unless supported by higher production, stronger exports and increased remittance inflows.
He called for interest-free or low-interest loans for productive businesses, support for small and medium-sized enterprises, more selective import policies and diversified exports. Financing should be linked to measurable results, including higher output and employment and lower energy consumption, he said.
Abdul Rahman Mohammed, a professor of finance and banking at the University of Hama, said a stronger productive base that reduced import dependence and generated foreign currency was essential, alongside adequate foreign exchange reserves and political and security stability.
Monetary discipline and exchange-rate policy
Economic and banking expert Ibrahim Nafe Qushji attributed exchange-rate fluctuations to economic, structural, political and geopolitical factors affecting foreign currency supply and demand.
Rising imports of petroleum products, energy, raw materials and production supplies sustained demand for dollars, while the gap between official and parallel-market rates could weaken formal banking channels and encourage currency exchanges and remittances outside them, he said.
Qushji called for reviewing liquidity restrictions and allowing commercial banks to buy and sell foreign currencies under a clear regulatory framework. He also advocated a managed move toward exchange-rate liberalization once monetary and banking conditions were ready.
Expanding the money supply to finance salaries or the budget deficit without corresponding productive growth would increase pressure on the pound, he said.
Economic researcher Abdul Azim al-Mogharbel similarly warned against increasing the money supply without growth in production. Stability required balancing foreign currency supply and demand, controlling inflation and liquidity, and expanding production and exports, he said.
Remittances and exports key to foreign currency supply
Mohammed said lasting stability would require actual foreign currency inflows from remittances, exports and investment. Routing these funds through official banking channels would strengthen the central bank’s ability to manage the foreign exchange market.
Remittances remain an important source of foreign currency but are affected by seasonal and regional conditions. Exports could provide more sustainable inflows if production expands and access to overseas markets improves, he said.
The experts called for stronger correspondent-banking relationships, improved electronic payments and more reliable official remittance channels. Encouraging Syrians abroad to invest in productive projects could also support economic activity and foreign currency earnings.
Banking reforms face a test
Official efforts to develop the financial sector include the establishment of the Damascus Foreign Exchange and Gold Market, a financial-sector modernization project and cooperation with international banking institutions.
In June 2026, the Central Bank of Syria allowed recipients of international money transfers to choose between receiving Syrian pounds or foreign currency, subject to the paying agent’s available options. On Sept. 27, Governor Mohammed Safwat Raslan said the bank intended to require remittances to be paid exclusively in foreign currency.
Raslan also forecast that more than $1 billion in foreign capital could enter Syria to establish new banks. He said seven delegations had expressed interest in setting up banks in the country.
Mohammed said restructuring banks, activating correspondent-banking relationships and improving credit and electronic payment services could expand formal transactions and reduce reliance on the parallel market, although the effects would take time.
The experts said lasting stability would depend on reducing inflationary pressures, expanding foreign currency inflows through official channels and directing financing toward production, exports and job creation.
N.J/M.F
