Syria to drop two zeros from its currency in bid for stability

DAMASCUS, Syria — Syria will issue new banknotes, removing two zeros from its currency in an attempt to restore public confidence in the severely devalued pound, according to seven sources familiar with the matter and documents reviewed by Reuters.

The step is intended to strengthen the Syrian pound after its purchasing power collapsed to record lows following a 14-year conflict that ended with then-president Bashar al-Assad’s ouster in December.

Confirming the move, Syria’s Central Bank Governor Abdelkader Husrieh says the revaluation was a strategic pillar of fiscal and monetary reforms.

“We have formed committees with public and private banks and experts from the central bank to determine the requirements for changes” in the currency, he tells Saudi state-owned broadcaster Al Arabiya, describing the new currency as a “necessity.”

He says a time frame to introduce the new currency was still “under review.”

The Syrian pound has lost more than 99 percent of its value since war erupted in 2011, with the exchange rate now at around 10,000 pounds to the US dollar, compared to 50 before the war.

The sharp depreciation has made daily transactions and money transfers increasingly difficult.

Families usually pay for weekly grocery runs from black plastic bags holding at least half a kilogram of 5,000-pound notes, currently the highest denomination.

In an attempt to ease transactions and improve monetary stability, Syria’s central bank informed private banks in mid-August that it intended to issue new currency by “removing zeros,” according to a document seen by Reuters.