As Lebanon's gridlock continues, Syria accelerates its own financial reset

Report by Bassam Abou Zeid, English adaptation by Yasmine Jaroudi

Financial and banking measures recently adopted by Syrian authorities are unlikely to have a substantial impact unless the U.S. Caesar Act sanctions are fully lifted. 

Any meaningful reform must be paired with new legislation to combat money laundering and terrorism financing, as well as broader political and economic stability.

According to analysts monitoring Syria's financial sector, these changes are expected to materialize over time as part of the country's broader reconstruction. The International Monetary Fund (IMF) and the World Bank are preparing to engage in financial and banking reforms, as well as reconstruction efforts, following missions to Syria in November.

In the meantime, Syrian authorities have reconnected the country's banks to the global SWIFT system to facilitate international transactions. The central bank has also opened talks with relevant companies to restore the use of bank cards and has given Syrian banks a six-month deadline—starting in October—to address financial losses linked to Lebanon's banking crisis.

The central bank has additionally welcomed applications for new investment banking licenses, including from Islamic banks, following expressions of interest from several Arab and foreign entities. Work is also underway to unify the exchange rate of the U.S. dollar against the Syrian pound and issue a new currency.

President Ahmed al-Sharaa has appointed strong financial leadership, citing Finance Minister Mohammad Barnieh—who has trained at the U.S. Federal Reserve and worked at the World Bank—and Central Bank Governor Abdulkader Husrieh, who brings extensive international experience.

Syria's financial sector appears to be moving toward a more streamlined reboot, they add, in stark contrast to the situation in Lebanon, where political disputes have stalled financial reform since 2019. 

The latest example is the ongoing contention over the draft law addressing the financial gap between the state, banks, and the central bank—an issue that is delaying an agreement with the IMF. 

However, some officials suggest the government may submit the bill to Parliament before year-end.