Eyeing Reconstruction, Syria and Iran Reach Agreement on Bank Transfers

DAMASCUS (Reuters) – The governments of Syria and Iran have reached an agreement to facilitate banking transactions between the two countries, officials announced on Tuesday. This initiative aims to enhance trade and investment as Syria looks to its ally Iran for assistance in post-war reconstruction.

The agreement was among several made during the visit of Iranian Vice President Eshaq Jahangiri to Damascus, a visit significant for Iran’s longstanding support of President Bashar al-Assad throughout the conflict.

With Western nations distancing themselves from Syria in support of the opposition, the Syrian government is turning to allies like Iran, Russia, and China for reconstruction efforts. Nonetheless, Western restrictions on banking have hampered the ability of Syria and Iran to conduct financial transactions.

Speaking at an Iranian-Syrian business forum in Damascus, Jahangiri stated that "ministers confirmed that banking transactions will take place very soon between the countries."

Iran’s central bank governor, Abdolnaser Hemmati, remarked in statements spread by Iranian state media that the agreement allows banks to engage in transactions using their local currencies as well as non-dollar foreign currencies.

Iran has been instrumental in supporting Syria throughout the war, including deploying its own forces alongside Tehran-backed Shiite militias like Hezbollah from Lebanon.

An executive from the Iranian company Saab Niroo, Mohammad Saeed Shahmiri, noted that his firm was examining infrastructure projects around Damascus but pointed out that the banking issue was the "most important problem." He expressed hope that resolving this banking difficulty would allow for immediate project initiation.

Keyvan Kashefi, chairman of the Iranian-Syrian chamber of commerce, indicated that the two nations had lacked strong banking connections in recent years, an issue frequently raised by the private sector in both countries. He added, "It was announced today that some agreements have been reached. The banks of the two countries can now assist businessmen and industrialists with financial exchanges, thus addressing our issues."

Mohamad Hamsho, a businessman and chairman of the Syrian chambers of commerce, echoed this sentiment, stating that agreements had been made to "overcome obstacles with respect to the banking activity between Iran and Syria."

With assistance from Russia and Iran, the Syrian government has largely subdued rebel forces throughout much of the country, although a segment in the northwest remains under control of anti-Assad insurgents. Kurdish-led factions, which do not oppose Damascus, maintain control over significant territories in the east and north.