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Economy

Ban On Syrian Money — Is ISIS About To Issue Its Own Currency?

ISIS has banned the use of newly pressed 500 and 1,000 Syrian pound notes. Some fear its the start of a currency switch, though others say it's a way for some to profit on money exchanges.

A Damascus woman reads a brochure about the new 1,000 Syrian Pounds bill issued last June.
A Damascus woman reads a brochure about the new 1,000 Syrian Pounds bill issued last June.
Ammar/Xinhua/ZUMA
Ahmad al-Bahri

RAQQA — The self-proclaimed Islamic State has outlawed the circulation of two Syrian banknotes issued by the Bashar al-Assad government in Damascus, in what some believe could be a precursor to a complete phasing out of Syrian currency in areas under the jihadist group's control.

Religious police ISIS" de facto capital of Raqqa have outlawed the 500 and 1,000 Syrian pound notes, issued in 2013 by the Syrian government in Damascus. The illegal currencies are to be replaced with older or smaller bills and dumped in areas outside the jihadist group's controls, according to a memorandum obtained by Syria Deeply.

[rebelmouse-image 27089673 alt="""" original_size="972x1296" expand=1]

The announcement reads:

Announcement to all Exchange Shops: We have decided, with the help of God, to ban the use of the newly issued currency by the Alawite regime (the 1000 bill and the 500 bill) in our territory starting the date of the announcement. Sep 27. Exchange shops should not use it or exchange it. They should only take it out of the Islamic State areas. And anyone who opposes this law will be punished, starting from 14 November. God bless and guide you to the right path.

"ISIS informed all currency and exchange businesses about the new law," Abu Mahmoud, the owner of a currency exchange business in Raqqa, told Syria Deeply. "They instructed us to take the newly issued bills and replace them with either older issues or smaller bills. We've been instructed to take the newly issued bills that we gather outside the Islamic State's borders, to areas controlled either by the regime or by other opposition factions."

Members of Raqqa's Hisbah office — ISIS's religious police — claim the reason behind the new law, which was issued at the end of September 2015, is to protect citizens under the group's control from financial loss.

"We prohibited their circulation in order to protect Muslims from financial losses," said Abu Muhammad, a 37-year-old member of ISIS. "There are other bills that people can use. We want them to exchange these newly issued bills with other ones, so that they do not lose any money, especially if they want to use them outside Syria."

According to Abu Muhammad, ISIS will soon issue its own currency — a gold, silver and copper coinage rumored to be prohibitively expensive — which will be the only currency accepted in areas under the group's control.

Citizens of Raqqa with whom Syria Deeply spoke, however, said the new law was a pretext for ISIS's foreign cadre to garner extra profits from the currency exchange business.

Mazen al-Abdalla, a 28-year-old media activist from Raqqa, believes the new law is just another technique ISIS will use to exploit people under its control.

"For months now," Abdalla told Syria Deeply, "the word on the street has been that ISIS would issue its own gold and silver currency, and that Syrian currency would eventually be eliminated."

Most of the jihadist organization's non-Syrian fighters have a hand in the currency exchange business, according to Abdalla, arguing that the currency switch isn't just a simple state-building move by ISIS, but a scheme to make money. Exchange offices in Raqqa and throughout the majority of ISIS territory are either fully or semi-controlled by foreign members of ISIS.

Businessmen, storeowners and average employees alike are afraid the value of their Syrian currency in ISIS areas will soon completely collapse.

"All my cash savings are in the newly issued 500 and 1,000 pound bills," said Abu Bassil, a 45-year-old man from Raqqa. "According to the new law, I have to exchange them as soon as possible. I can hand them over and receive smaller or older issue bills. But I'm afraid ISIS will issue its own currency soon, and in that case, I might lose all my savings."

"The Syrian pound is worth a great deal less than it used to be, and it's only getting worse. I'll probably lose about one-third of my savings. But I guess one-third is better than losing all of it," Abu Bassil said.

Rumors that ISIS's monetary authorities in Raqqa may soon issue their own currency have left Raqqa's citizens equally panicked.

While the question remains whether the currency switch is just for show, or a secret money maker for ISIS foreign elites, Mazen al-Abdalla, the media activist, is sure of one thing: Somebody's making money off the switch. "We're talking about exchanging and taking an entire currency off the market," he said. "There's a lot of money to be made."

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