Syria Daily: Will Iran Prop Up Assad With Another $1 Billion?

By Scott Lucas May 6, 2015 – Head of Central Bank says Tehran agreeing to another line of credit – The head of Syria’s Central Bank says that Iran is considering the provision of another $1 billion line of credit to prop up the Assad regime. Adib Mayaleh claimed Tehran has given preliminary approval for the credit line. Iranian State media are recycling Mayaleh’s statement without adding any news about the Islamic Republic’s decision.

In July 2013, Iran extended $3.6 billion to Damascus, mainly for the purchase of essentials such as energy products and food. The Assad regime has been trying for months to assure another line of credit when the initial funding runs out. Shortages are becoming more serious, as the Islamic State has captured most oil and gas fields and food production has been restricted by the four-year

conflict. The Syrian currency has lost more than 80% of its value. Prices are rising to the point where a month’s salary in Damascus equals the purchase of 25 kilograms (40 pounds) of bananas. Housing is close to unaffordable, unless a home is already owned in full. Mayaleh insisted that the regime still has money left from the July 2013 agreement, which he said was only $1 billion.

The Iranian regime, facing its own economic difficulties amid US-led sanctions and sharply reduced oil exports and prices, has appeared reluctant to provide another line of credit. Syrian officials have been negotiating, including visits to Tehran, for the extension since last November.

The Central Bank Governor accused Turkey, Qatar, and Saudi Arabia of waging an economic war on Syria and also blamed Syrians for their trading in foreign currency: “These speculators are just like the armed gunmen.” In recent weeks, the Assad regime has ordered exporters to sell all foreign currency to the Bank, and security forces have raided commercial premises and even residences looking for any holdings. Mayaleh insisted the Bank has not used its foreign reserves, relying on inflows of $10 million daily from personal transfers and exports to fund imports.