Syria regime siphons aid to its coffers
BEIRUT – Syrian President Bashar Assad’s government has used distorted exchange rates to divert at least $100 million in international aid to its coffers in the past two years, according to new research.
The currency manipulation deprives Syrians, most of them impoverished after a decade of war, of much-needed funds. It also allows the Damascus government to circumvent sanctions enforced by Western countries that hold it responsible for most of the war’s atrocities.
“Western countries, despite sanctioning Syrian President Bashar Assad, have become one of the regime’s largest sources of hard currency,” said the report published this week by the Center for Strategic and International Studies, a Washington-based research organization that focuses on international public policy issues.
“Assad does not merely profit from the crisis he has created,” the report added. “He has created a system that rewards him more the worse things get.”
On Friday, the United Nations acknowledged exchange-rate fluctuations have had “a relative impact” on the effectiveness of some of the U.N. programs, particularly since the second half of 2019, when the Syrian currency took a nosedive.
Francesco Galtieri, a senior Damascus-based U.N. official, said his office received the report on Thursday. “We are carefully reviewing it, also to openly discuss it in the coming weeks with our donors, who are as concerned as we are that the impact of the assistance to the people in Syria is maximized,” Galtieri, team leader of the Resident and Humanitarian Coordinator for Syria, told the Associated Press in a written response.
The authors of the research published Wednesday said the amount of aid lost and diverted to Syrian government coffers as a result of the national currency fall is likely to be more than $100 million over the last two years.
Syria’s Central Bank, which is sanctioned by the U.S. Treasury, obliges international aid agencies to use the official exchange rate – kept to about 1,500 Syrian pounds to the dollar – while the black-market rate hovered about 4,000 pounds to the dollar. The Syrian government outlaws the use of unofficial currency exchange services. The official exchange rate has since been changed to about 2,500, leaving a gap of more than 30%, the report said.
That is an automatic loss of about two-thirds of aid funds in the exchange rate transaction, the report said.
The war in Syria has been described as one of modern history’s most brutal, rife with the use of indiscriminate barrel bombs, chemical weapons and torture.
Aid and rights groups also complain that the Syrian government has long directed international aid to areas it considers loyal to it and used sieges around areas held by the opposition to deny them assistance.
In a boon to Assad and following years of isolation, a number of Gulf countries have reopened their embassies. Jordan has restored direct flights to Damascus, and Egyptian gas will go through Syria, which will swap it for its own to send to Lebanon.