Syria to Revalue Currency by Removing Two Zeros in Historic Break from Assad Era: New Banknotes Signal Economic Reform and Political Transformation

Syria will issue new banknotes in December 2025, removing two zeros from its currency in an ambitious attempt to restore public confidence in the severely devalued Syrian pound, according to seven sources familiar with the matter and documents reviewed by Reuters. The move represents both a practical economic necessity and a powerful symbol of the country’s break from more than five decades of Assad family rule.

The revaluation comes as Syria grapples with the aftermath of the most devastating economic collapse in modern Middle Eastern history, with the Syrian pound having lost more than 99% of its value since the conflict began in 2011. The currency crisis has made daily transactions increasingly difficult, forcing families to carry plastic bags filled with half-kilogram loads of banknotes just for weekly grocery purchases.

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Economic Devastation and Currency Collapse

The scale of Syria’s economic destruction defies easy comprehension. Before the war erupted in 2011, the Syrian pound traded at approximately 50 to the U.S. dollar. Today, the exchange rate hovers around 10,000 pounds per dollar – a depreciation that has effectively wiped out the savings and purchasing power of millions of Syrians.

This collapse represents what economists describe as one of the most severe currency devaluations in modern history. The Syrian pound has lost 99.64% of its value against the dollar compared to pre-2011 levels, leading one expert to observe that “the value of Syrian currency has become less than it costs to print it.”

The human impact of this economic catastrophe cannot be overstated. As of 2022, poverty affects 69% of Syria’s population – equivalent to about 14.5 million Syrians. Extreme poverty, virtually non-existent before the conflict, now affects more than one in four Syrians. Living conditions have deteriorated to what analysts describe as the worst since the beginning of the 20th century.

Central Bank Confirms Strategic Reform Initiative

Syria’s Central Bank Governor Abdelkader Husrieh confirmed the revaluation as a strategic pillar of broader fiscal and monetary reforms during an interview with Saudi state broadcaster Al Arabiya on Friday. “We have formed committees with public and private banks and experts from the central bank to determine the requirements for changes” in the currency, Husrieh explained, describing the new currency as a “necessity.”

The governor indicated that while the timeframe for introducing the new currency remains “under review,” the central bank has already begun coordinating with financial institutions to prepare for implementation. This represents the most significant monetary reform attempt since the current crisis began over a decade ago.

The decision reflects the practical impossibility of conducting normal economic transactions with the current currency denominations. Families routinely require black plastic bags to carry the volume of 5,000-pound notes – currently the highest denomination – needed for basic purchases. The logistical burden of handling such large volumes of low-value currency has become a significant impediment to economic activity.

Technical Implementation and Timeline

According to documents seen by Reuters, Syria’s central bank informed private banks in mid-August of its intention to issue new currency by “removing zeros.” Five commercial bankers, one central bank source, and one Syrian economic official confirmed that two zeros would be removed from existing denominations.

The revaluation process has been coordinated through meetings chaired by Central Bank Deputy Governor Mukhlis al-Nazer, attended by representatives from commercial banks throughout the country. These preparatory sessions indicate the extensive coordination required to implement such a fundamental change to the monetary system.

Central bank circulars have requested banks to produce detailed reports on their infrastructure capabilities, including the number of cameras, cash counters, and storage capacity. Banks have also been instructed to run tests ensuring their automated systems can handle the new currency denominations – a critical technical requirement given the complexity of transitioning an entire monetary system.

Two commercial bank directors confirmed that Syria’s central bank has instructed lenders to be ready for rollout by mid-October 2025, with the formal launch planned for December 8 – marking the one-year anniversary of Assad’s ouster. This symbolic timing underscores the political significance of the currency reform beyond its economic necessity.

Russian Partnership and Production Arrangements

The production of Syria’s new banknotes will continue the country’s historical relationship with Russian printing capabilities. Two bankers and another Syrian source confirmed that Syria has reached an agreement with Russian state-owned money printing firm Goznak to produce the new notes. The deal was finalized during a senior Syrian delegation’s visit to Moscow in late July 2025.

Goznak previously printed Syria’s currency during the Assad era, providing continuity in production capabilities despite the dramatic political changes. This partnership reflects Syria’s continued reliance on Russian technical expertise and infrastructure, even as the country seeks to distance itself politically from the Assad period.

The choice of Russian printing capabilities also reflects practical considerations, as international sanctions and diplomatic isolation have limited Syria’s options for such technical services. The arrangement demonstrates how Syria’s new leadership must navigate complex international relationships while pursuing domestic reform objectives.

Political Symbolism and Historical Break

The currency revaluation carries profound symbolic weight, representing a clear break from more than five decades of Assad family rule. Current banknotes feature the images of both Bashar al-Assad, who appears on the purple 2,000-pound note, and his father Hafez, featured on the green 1,000-pound denomination.

The removal of these images through the introduction of new banknotes sends a powerful political message about Syria’s transformation. Officials plan an extensive information campaign in the coming weeks before the December launch, designed to educate citizens about the changes while reinforcing the symbolic importance of moving beyond the Assad era.

This symbolic dimension extends beyond mere imagery to represent fundamental changes in Syria’s economic and political orientation. The new leadership has announced plans to implement market liberalization reforms, including dismantling existing import-export control systems and moving toward a free-market economic model – changes that the currency reform is intended to support.

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Post-Assad Economic Transformation

Syria’s currency reform occurs within the context of broader economic transformation following Assad’s ouster in December 2024. The new government has appointed Basel Abdul Hannan as Minister of Economy, who has announced plans for comprehensive market liberalization including removing restrictions on imports and allowing registered businesses to trade more freely.

The interim government has also made historic appointments, including Maysaa Sabreen as Syria’s first female central bank governor on December 30, 2024. These changes signal a dramatic departure from the Assad regime’s economic policies and governance structure.

Under Assad, the use of foreign currencies was outlawed, but Syria’s new leaders have pledged to create a free-market economy and lifted restrictions to ease cash flow. This policy reversal reflects recognition that economic recovery requires fundamental changes to monetary and trade policies that contributed to Syria’s economic isolation.

Challenges and Implementation Concerns

Despite the symbolic and practical importance of currency reform, significant challenges remain. The economy has become heavily dollarized, with U.S. dollar prices common everywhere from store fronts to fuel pumps. This dollarization reflects Syrian citizens’ loss of confidence in their national currency and creates complications for monetary policy implementation.

Three Syrian bankers identified a particular concern about an estimated 40 trillion pounds circulating outside Syria’s formal financial system. The issuance of new notes is intended to provide the government with better oversight over cash circulation, but achieving this objective will require extensive coordination and public cooperation.

Syrian economist Karam Shaar warned that the revaluation could confuse consumers, especially the elderly, while noting the lack of a clear regulatory framework for full national implementation given gaps in territorial control. As an alternative, Shaar suggested Syria could issue higher denomination notes (such as 20,000- or 50,000-pound notes) to achieve similar goals while avoiding the substantial costs of a complete currency overhaul.

International Context and Sanctions Relief

The currency reform occurs as multiple nations have begun lifting economic sanctions on Syria following Assad’s fall. This sanctions relief is crucial for the success of monetary reforms, as international isolation severely constrained Syria’s ability to access global financial systems and conduct international trade.

The gradual removal of sanctions creates opportunities for Syria to rebuild economic relationships with international partners and access technical assistance for monetary reform. However, significant restrictions remain in place, particularly those targeting institutions and individuals associated with the former regime.

Syria’s new leadership faces pressure to demonstrate commitment to democratic governance and human rights protection as conditions for continued sanctions relief. The success of currency reform may depend partly on the international community’s willingness to support Syria’s economic transition through expanded trade relationships and technical assistance.

Regional Economic Integration Potential

The currency stabilization effort represents a crucial step toward Syria’s potential reintegration into regional and global economic systems. Before the conflict, Syria had a relatively diverse economy with agriculture, oil exports, manufacturing, and a growing service sector contributing to GDP. The country served as an emerging regional trade and tourism hub with modest economic growth driven by market-oriented reforms.

Restoring currency stability is essential for rebuilding these economic relationships and attracting the foreign investment necessary for reconstruction. The World Bank estimated that Syria’s GDP shrank by 54% between 2010 and 2021, with 90% of Syrians now living in poverty. Recovery from such devastation requires stable monetary foundations that the currency reform is intended to provide.

Implementation Timeline and Coexistence Period

The practical implementation of currency reform will occur through a carefully planned transition process. All five commercial bankers confirmed they were informed of a 12-month “coexistence period” during which both old and new notes will circulate simultaneously. This transition period will conclude on December 8, 2026, providing time for citizens and businesses to adapt to the new denominations.

This extended transition period reflects lessons learned from currency reforms in other countries, where abrupt changes can create economic disruption and public confusion. The gradual implementation allows for systematic replacement of old notes while maintaining economic continuity during the adjustment process.

Banks have been instructed to prepare comprehensive infrastructure assessments and testing protocols to ensure smooth technical implementation. This preparation includes upgrading automated systems, training staff, and coordinating with businesses to minimize disruption to daily economic activities.

Historical Context and Precedents

Syria’s currency reform occurs within a broader historical context of post-conflict economic reconstruction. The country joins other nations that have used currency reform as both a practical economic tool and a symbol of political transformation following regime change.

The removal of Assad family images from currency represents a particularly powerful symbolic gesture, comparable to similar actions taken by other countries following the end of authoritarian rule. This symbolic dimension may prove as important as the practical benefits of denomination reduction in restoring public confidence in Syrian institutions.

The coordination with Russian printing capabilities also reflects the complex international relationships that continue to shape Syria’s economic options. While seeking political transformation, Syria must navigate existing relationships and limited alternatives for technical services required for such fundamental monetary changes.

Economic Recovery Prospects and Challenges

The success of currency reform will ultimately depend on broader economic recovery efforts that address the fundamental causes of Syria’s monetary instability. These include rebuilding productive capacity, restoring international trade relationships, and creating employment opportunities for Syrian citizens.

Syria’s economy faces extraordinary challenges, with every sector destroyed by conflict and sanctions. The country’s ability to provide basic services like electricity, water, and infrastructure has deteriorated to unprecedented levels. Addressing these challenges requires sustained international support and domestic reform efforts that extend far beyond monetary policy.

The currency reform represents an important first step in this broader recovery process, but success will require coordinated efforts across multiple policy areas. Without accompanying reforms to restore productive capacity and international economic relationships, currency stabilization alone cannot address Syria’s fundamental economic challenges.

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By: Montel Kamau

Serrari Financial Analyst

25th August, 2025