Recent weeks have seen the Syrian economy deteriorate further and the national currency, the Syrian pound, fall to an all-time low.
Four years of an uprising-turned-civil war have taken their toll on Syria’s economy and society. Following European sanctions on its oil sector and the takeover of all the main oil fields by ISIL and Kurdish groups, the government has stopped generating foreign currency receipts, while the destruction of most business activity has reduced fiscal revenues. Increasingly, the government is seeking the help of its allies, Iran and Russia, to fill the gap.
Iran, in particular, has taken a leading role in providing financial support to Damascus.
In January 2013, it extended a credit line of $1 billion. The Syrian government could use the money to pay for imports with the condition that 60 percent of these imports came from Iran. Since then many tenders issued by public sector companies have included the mention that bidding is open only to Iranian companies.
Then, in August 2013, Tehran provided another credit line, this time worth $3.6 billion, dedicated to the purchase of oil products, also mostly from Iran.
These two financial agreements helped Iran increase its share of Syrian imports to a third of the total.