Swift operations in Syria set to resume within a few weeks.
### Syria's SWIFT Reconnection: A Catalyst for Economic Recovery
After a 14-year absence, Syria has reconnected to the international payment system SWIFT, a significant milestone in its journey towards financial reintegration and economic recovery. This historic move, announced by Abdul Kadir Husriye, the head of the Syrian central bank, in an interview with Financial Times, marks the end of years of financial isolation due to international sanctions and civil war.
The reconnection to SWIFT enables Syrian banks to conduct direct, legal international transactions, a crucial step towards attracting investment, repatriating diaspora savings, and facilitating remittances, which were previously managed through informal and often risky channels.
The move is critical for accessing the substantial funds needed for rebuilding Syria’s war-ravaged infrastructure. The United Nations estimates that nine out of ten Syrians now live in poverty, underscoring the urgency of economic recovery. The lifting of sanctions and SWIFT access is seen as a catalyst for economic recovery, potentially unlocking up to $25 billion in diaspora savings and encouraging foreign direct investment, especially in sectors like banking technology and real estate.
The Central Bank of Syria has announced plans to unify exchange rates and transition to a managed float of the Syrian pound, a move expected to stabilize the macroeconomic environment and reduce risks for foreign investors. The ability to make direct payments to and from Western financial institutions is essential for restarting legitimate international trade, which had been severely restricted.
The SWIFT reconnection is part of broader efforts to restore Syria’s international relations, highlighted by recent diplomatic engagements, including a meeting between Syria’s interim president and the U.S. president. However, full normalization will require Syrian banks to meet international transparency, anti-money laundering, and counter-terrorism financing standards—areas where Syria has faced historical scrutiny. Compliance with these standards is critical for rebuilding international trust and for the system to function sustainably.
The restart of the Swift system is expected to simplify the export of goods from Syria, reduce import costs, and reduce dependence on informal financial systems in cross-border trade. The return of Swift is expected to help stimulate international trade in Syria and bring much-needed foreign currency to the country.
Notable developments include the World Bank's $15.5 million debt with Syria being settled by Saudi Arabia and Qatar last month, the U.S. Treasury Department removing most restrictions on Syria, and agreements being signed with companies from the UAE, Saudi Arabia, and Qatar for large infrastructure and energy projects in Syria. The European Union also announced that it was removing all economic sanctions imposed on Syria by the end of the month.
In summary, Syria’s reconnection to SWIFT is a watershed moment that enables direct international payments, reduces reliance on informal systems, and opens the door for reconstruction funding and foreign investment. However, the full economic and foreign trade benefits will depend on continued sanctions relief, banking sector modernization, and adherence to international financial standards.
The SWIFT reconnection allows Syrian businesses to engage in legal and direct international transactions, a key factor for attracting investment, repatriating diaspora savings, and encouraging foreign direct investment. The restoration of international relations, indicated by diplomatic meetings and debt settlements, along with the SWIFT access, could unlock up to $25 billion in diaspora savings, but sustained economic recovery requires Syrian banks to comply with international transparency, anti-money laundering, and counter-terrorism financing standards.
