Reasons Behind the Syrian Pound’s Dramatic, Unstoppable Boom!

A year ago, the Syrian pound (SYP) seemed destined to collapse completely. War, sanctions, and hyperinflation had left the currency barely functioning. People had turned to the U.S. dollar, gold, or anything more stable. 

And yet in 2025, something unexpected happened: the Syrian pound began to rise — and it kept rising. This wasn’t some fluke. Behind the boom are a mix of policy shifts, political changes, and outside investments. But can the rally last? Or is this just another spike before a fall? 

Lets find out along with the reasons behind the Syrian Pound’s dramatic, unstoppable boom!

1. De-Dollarization Strategy in Domestic Markets

One of the driving forces behind the Syrian pound’s recent rise is the government’s aggressive push to de-dollarize the economy. In an attempt to re-establish the Syrian pound (SYP) as the central currency in all domestic transactions, authorities have introduced a wave of new regulations and policy campaigns. The idea is to reduce dependency on the U.S. dollar and strengthen the pound’s role in everyday economic life — but the road to full implementation is far from smooth.

• Official Push to Use the Syrian Pound: One of the first moves behind the pound’s recovery came from government attempts to reduce the role of the U.S. dollar in local transactions. This “de-dollarization” effort included new rules mandating that prices for goods and services be listed in Syrian pounds rather than foreign currencies.

These measures were designed to rebuild faith in the national currency and slow down the dollarization that had taken over large parts of Syria’s economy. For instance, even rent and food had been priced in dollars during previous years. The change has helped re-center the pound in everyday life — at least on paper.

• Reality vs. Policy: Despite these efforts, de-dollarization remains more of a goal than a reality. In high-value transactions — especially cross-border deals or large purchases — the U.S. dollar remains the preferred currency. This gap between official policy and street-level reality continues to create confusion, which fuels black-market activity and speculation.

2. Policy Tightening and Money Supply Control

Another key reason behind the Syrian pound’s recent surge is the government’s attempt to control inflation and stabilize the currency by restricting the money supply. The Central Bank of Syria has moved away from loose monetary policy and instead adopted aggressive tools to limit liquidity — a move that has both helped the currency and caused ripple effects across the economy.

• Cutting Off Excess Money Printing: In a notable shift from past policies, Syria’s central bank adopted a tighter monetary policy to stop flooding the market with new banknotes. Over the last year, it has sharply limited the amount of new currency being printed. The goal was simple: make the pound scarcer and more valuable.

At the same time, the central bank imposed strict withdrawal limits at commercial banks, making it harder for people to access large sums of cash — and by extension, harder for money to flood into currency exchange markets.

• Liquidity Crunch and Temporary Strength: This contraction in the money supply created a liquidity crunch. With fewer Syrian pounds circulating, the currency started to appreciate against the U.S. dollar — at least temporarily. But this also meant that small businesses and everyday consumers struggled to access cash for routine needs.

While these policies helped boost the pound’s value, they also slowed down economic activity in certain sectors. It’s a balancing act — one that might not be sustainable without deeper structural reform.

3. Shift in Import Dependency and Local Production

Reducing dependency on imported goods has become a central part of Syria’s broader economic recovery plan. This effort aims to boost local production, protect domestic industries, and reduce demand for foreign currency — particularly U.S. dollars. In turn, this shift has helped stabilize and strengthen the Syrian pound in recent months.

• Protecting Domestic Industries: Another reason behind the pound’s recent rise is Syria’s push to reduce its reliance on imports. New customs duties have made foreign goods more expensive, encouraging consumers to buy locally and giving domestic manufacturers a needed edge.

This strategy is designed to strengthen internal economic resilience and reduce the outflow of foreign currency, especially U.S. dollars. By discouraging imports and promoting Syrian-made products, the government hopes to both preserve foreign reserves and support the pound’s value from within.

• Early Signs of Industrial Recovery: While it’s still early, there are some promising signs. In regions where security has stabilized, local factories and workshops are coming back online. Agricultural production is also on the rise. If this trend continues, it could create jobs, generate local wealth, and support the long-term strength of the Syrian pound by decreasing demand for imports.

The shift isn’t just economic — it’s also psychological. When people see goods produced locally and sold in Syrian pounds, it reinforces the currency’s relevance in daily life and boosts national confidence in the economy.

4. Public Trust Returning to National Currency

Public trust is a fragile yet powerful force in currency markets. In Syria’s case, the recent rise of the pound has been driven not just by economic measures, but by shifting public sentiment — much of it rooted in political developments rather than structural reforms.

• Political Events Shift Sentiment: The Syrian pound’s rally wasn’t driven solely by policy. Public psychology played a major role. When former U.S. President Donald Trump hinted at possible sanctions relief, that statement alone triggered a spike in confidence — and a surge in the SYP’s value.

In a country where economic news is tightly controlled and often delayed, even rumors can create real market movement. And that’s exactly what happened. News of possible foreign investment and diplomatic shifts made the public more willing to hold pounds rather than rush to dollars.

These emotional surges — powered by hope or fear — often override logic. In the case of the pound, the mere possibility of sanctions relief made people feel that the worst might be over, at least for now.

• Confidence Is Still Fragile: However, trust in the Syrian pound remains paper-thin. Most citizens still view the currency with caution, especially after years of inflation and economic mismanagement. The central bank itself has acknowledged that psychological factors are driving the surge more than true economic recovery.

Without long-term stability and transparency, that trust can disappear overnight. Many people still hedge their bets by holding dollars or gold, ready to switch at the first sign of trouble. Until there are meaningful reforms, public trust will continue to rise and fall with the news cycle — not with the strength of the economy.

5. Role of Gulf Investments and Political Backing

Beyond domestic policy, one of the most impactful forces behind the Syrian pound’s dramatic rise has been renewed economic engagement from Gulf nations. These investments not only bring capital — they signal trust, stability, and a potential shift in Syria’s geopolitical standing.

• UAE and the $800 Million Game-Changer: Syria’s improving relations with Gulf nations — especially the United Arab Emirates — have brought in crucial new investments. One of the most talked-about deals was the $800 million agreement with DP World to develop and operate the port of Tartus.

This investment is not just financial; it’s symbolic. It signals that parts of the international community may be warming to the idea of re-engaging with Syria — economically, if not yet politically. The move also marks a critical turning point in Syria’s long-standing isolation, creating a sense of optimism in the local economy.

The Tartus port development is expected to boost trade, increase job opportunities, and create much-needed foreign currency flows. For a country grappling with sanctions and capital shortages, such infrastructure deals could help lay the foundation for longer-term economic resilience.

• Currency Printing Abroad Signals a Shift: Another subtle but telling development is Syria’s decision to shift currency printing operations away from Russia — where they were historically based — to countries like the UAE and Germany. This change suggests broader financial cooperation and an attempt to diversify Syria’s international partnerships.

Printing currency in the UAE and Germany may also offer higher-quality banknotes and more transparency, which can reduce counterfeiting and improve overall public confidence. These moves, while technical, have real psychological value. They represent a step toward modernization and professionalism in monetary management.

Final Word

There’s no doubt about it — the Syrian pound’s recent boom has shocked many. After years of collapse, the currency is rising, and for now, the momentum seems strong. But this rise is driven by a mix of limited supply, political posturing, social media speculation, and short-term optimism. 

The real test is yet to come.

If the government follows through with real reforms — building trust, fixing the banking system, and encouraging investment — then the pound might just have a future. 

But if things stay the same behind the scenes, this boom could be just another temporary spike in a long and painful decline.