Local authorities in northwest Syria’s Idlib are replacing the plummeting Syrian pound with the Turkish lira to shield their opposition-held region from economic collapse, an official said Monday, amid huge hikes in the prices of goods and commodities. Last week photos of Turkish lira coins in regions that were liberated by Turkey-backed Syrian opposition groups from terrorist organizations were circulating on social media.
The Salvation Government – an administrative body affiliated with the al-Qaida-linked Hayat Tahrir al-Sham (HTS) which dominates areas in the Idlib region – already started paying wages and salaries in Turkish liras last month, said Bassel Abdul Aziz, who heads its economy department.
He said it has “instructed commercial traders and money exchange houses” to circulate low-denomination Turkish coins and banknotes to be used “for everyday transactions in liberated territories instead of the Syrian pound.”
The use of the Turkish lira in a province like Idlib, the population of which has swelled to around 3 million, doubling the prewar population of 1.5 million, would further reduce the value of the Syrian pound over reduced demand.
At a money transfer office in the province on Sunday, an Agence France-Presse (AFP) correspondent saw bags of Turkish lira coins on the floor alongside boxes filled with banknotes.
In a statement on Friday, the United Nations said a “large” shipment of Turkish currency had reportedly entered Idlib on June 11.
Turkish lira notes were already in circulation in some of the areas in northern Syria, while most recently, last week, coins were said to have started coming in from Turkey, with photos circulating on Twitter showing coins in what was said to be a branch of the Turkish Post and Telegraph Organization (PTT) in the northwestern Azaz district.
Sharing a statement on his twitter account, Abdurrahman Mustafa, head of the Syrian Interim Government and the Syrian Turkmen Assembly, also said, “In order to protect citizens' savings due to the rapid depreciation of the Syrian lira, we intensified our negotiations with the relevant Turkish authorities and took the first step in the process of launching small TL banknotes, which are vital in daily life, in the north of Syria.”
The Syrian Interim Government recently formally approved the Turkish lira for circulation in its areas. The Syrian Interim Government was formed in 2013 by the moderate opposition forces as an alternative to the Bashar Assad regime. Its leaders are in exile in Turkey.
Hours after the Syrian Interim Government's decision, Turkish currency began circulating in the northern countryside of Aleppo, under the control of Turkish-backed opposition groups, in addition to Azaz, North Press Agency reported.
Syria’s economy has been battered by nine years of war compounded by a financial crisis in neighboring Lebanon, which had served as a conduit to bring dollars into regime-held areas.
The value of the Syrian pound has plummeted in recent days on the informal market, sending prices skyrocketing, shuttering shops and sparking rare anti-regime protests in the country’s regime-held south.
At one point last week, the pound sank to 3,000 to the dollar, more than four times the official rate of around 700, and 60 times its pre-2011 rate.
The spike comes ahead of the introduction of new U.S. sanctions from June 17 and after the sudden fall from grace of tycoon and Assad's cousin Rami Makhlouf, which has left other top businessmen on edge.
“The Syrian pound will continue to circulate in liberated areas but its use will be reduced to a minimum,” the local official said.
Under the new measures, the Salvation Government last week set the price for a loaf of bread at TL 2 (less than $1).
An AFP correspondent said that gas stations on Sunday started to list their prices in Turkish lira.
Turkey set up a dozen military observation posts in the Idlib region under a 2018 agreement with Russia, but most of these are now in areas held by Syrian regime forces.
Currently, Turkish soldiers are stationed in the region to protect the local population and moderate opposition groups. Still, despite the military escalation, Ankara has also been putting forth efforts to keep diplomatic channels active with Russia in the hope of finding a political solution, urging the country to uphold the latest cease-fire.
The Turkish-backed Syrian National Army (SNA) also controls a stretch of territory along its border in neighboring Aleppo province following a series of military operations that targeted terrorist elements.
Besides Euphrates Shield, carried out by the Turkish military and the SNA to clear Aleppo from terrorists, Turkey also launched three anti-terror operations – Olive Branch in 2018, Peace Spring in 2019 and Spring Shield this year – across its border in northern Syria to prevent the formation of a terror corridor and enable peaceful settlement by locals. Operation Olive Branch cleared northwestern Afrin district of YPG/PKK terrorists, while Operation Peace Spring liberated the northern towns of Ras al-Ayn and Tal Abyad from the terrorist group and captured areas along the strategic M4 highway. The most recent operation, Operation Peace Spring, targeted the Assad regime and its allied militias over their advance in Idlib in violation of a truce agreed upon between Ankara and Moscow.