Finance

The dollar has crossed the 6,000-pound level in the Syrian foreign exchange market for the first time on record, on the back of rising oil shortages.

Despite severe restrictions to its financial transactions with the outside world, Syria is unlikely to use the Russian alternative to the SWIFT system anytime soon.

Although the microfinance sector in North Syria remains small, several microfinance institutions and lenders continue to issue new projects and programmes to reduce the local population’s dependency on humanitarian aid.

The Hijaz Railways Organisation recently announced that it generated thousands of dollars in cash and millions of dollars in shares from its investments in Solidere, the company established by the late Lebanese Prime Minister Rafic Al-Hariri in 1994 to rebuild and develop Beirut after the Lebanese civil war.

On October 11, the U.S. Department of Treasury’s Office of Foreign Assets Control and Financial Crimes Enforcement Network levied the largest-ever penalty against a cryptocurrency exchange company for violating several sanctions programmes, including that of Syria. The action raises concerns about the growing use of virtual currency among sanctioned groups and individuals who seek to bypass sanctions and finance illegal operations, especially in Hayat Tahrir Al-Sham territories, where two cryptocurrency companies exist. 

Last week, the Syrian government sold SYP 72.50 billion worth of treasury bonds as part of its efforts to raise money to fund its deficit.

On October 11, the U.S. dollar crossed the 5,000-pound mark in the Syrian foreign exchange market for the first time on record, reflecting the surge of the American currency in global markets and the poor economic conditions in the country.

In this year’s second T-bond auction held on August 08, the Central Bank of Syria (CBS) managed to sell only 76 percent of its bonds, despite repeated government attempts to attract investors. 

Deutsche Bank AG has been fined USD 7.10 million (EUR 7.01 million) in a settlement following an investigation related to money laundering for relatives of President Bashar al-Assad. Deutsche Bank is said to have processed payments for the president's notorious uncle, Rifaat Al-Assad, in its capacity as a correspondent bank for another lender, according to German prosecutors.

The Ministry of Finance has authorised the trade of treasury bonds on the Damascus Securities Exchange starting next month. The government’s latest decision, which may attract more investors, comes ahead of the second T-bond auction scheduled for August 8. 

Banque Bemo Saudi Fransi responds to an article published by The Syria Report on links between its microfinance subsidiary and a militia-affiliated charity in Syria.

Syria’s two largest Islamic banks have expanded their branch network across the country this year contrary to all their competitors.

An affiliate of the Bemo banking group is providing microfinance loans to members of a charity linked to a militia that fought during the war and to various Iranian political figures. The charity is based in the Damascus suburb of Sayyida Zeinab. Another company involved in this project is the local agent of Western Union. The move carries serious risks to the group’s reputation.

Syria’s two main stock exchange indices gained between 11 and 15 percent in the first quarter of this year, although inflation and the low value of trading make it difficult to compare with previous periods. Meanwhile, the value of shares traded during the first quarter of this year was significantly less than the last quarter and the first quarter of 2021.

The Central Bank of Syria has issued two decisions to raise the minimum interest rate on term deposits and investment certificates and to increase the exchange rate of the US dollar for incoming remittances.

The year 2021 saw a significant increase for the main indices on the Damascus Securities Exchange, the only market in Syria for the trade of securities and bonds.

On February 03, the Central Bank of Syria announced that only 74 percent of the bonds it issued during its first auction this year were sold.

The Syrian Cabinet has approved the framework and methodology for a new electronic billing system that aims to regulate commercial transactions and help the government calculate taxes for businesses amid the reportedly high volume of tax evasion. The system will be connected to a QR code system launched by the Ministry of Finance to verify invoices issued by businesses.

Gulfsands Petroleum, a London-based oil and gas company that is the operator and joint-owner of Block 26 in Syria, recently received a multi-million dollar financing facility that will allow the company to operate until December 2023.

On January 03, the Central Bank of Syria (CBS) devalued the Syrian pound in its Official exchange rate bulletin, raising it to SYP 2,500 per US dollar from SYP 1,250. It has also recently eased restrictions on daily bank withdrawals, gradually reversing a previous measure that was adopted to strengthen the national currency.