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Syria borrows from Iran to improve value of its own currency

June 20, 2013 at 8:55 PM

DAMASCUS, Syria, June 20 (UPI) -- Iran has stepped in to help Syria raise the value of its currency after it plummeted following the United States announcing plans to arm Syrian rebels.

Before the Syrian civil war started more than two years ago, the Syrian pound was worth about 70 U.S. dollars; however, last week it was trading at 170 dollars, The New York Times reported.

To help bolster the value of its currency, Adib Mayalah, the governor of Syria's Central Bank, announced Tuesday it will tap into a $1 billion credit line provided by Iran.

However, experts say the move will be a temporary fix, as Iran is also facing heavy financial restrictions.

A Syrian expatriate currency market trader, speaking on the condition of anonymity, said he thinks the credit line from Iran is a psychological tool and might not even exist. The Syrian pound going up in value would be an indicator of this theory, he said.

"Unless they're able to knock it back to 150, I would imagine it would just be a cosmetic process," he said. "I'm personally extremely skeptical."

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