Wednesday, October 17, 2007

US row leads Syria to snub dollar

Syria has switched all of its government foreign exchange dealings from dollars to euros as part of a political stand-off with the US.
Government divisions and public sector firms have been ordered to use the euro for foreign goods and services by Syrian Prime Minister Naji al-Otari.

The state-owned Commercial Bank of Syria said the switch was "important and necessary".
Relations have been strained between the US and Syria for many years.
Syria's support for militant groups like Hezbollah in Lebanon and its hosting of the Palestinian group Hamas have been a major bone of contention as have US allegations - denied by Damascus - that its government had helped insurgents in Iraq and was seeking out weapons of mass destruction.
'US threats'

In 2004, the US imposed sanctions prohibiting certain US exports to Syria and froze the assets of Syrians it believed were linked to terrorism.

After the assassination of former Lebanese Prime Minister Rafik al-Hariri a year ago, the US led foreign pressure on Syria for its alleged role in the killing.

The Syrian government has denied any involvement.
Syrian President Bashar Assad has so far indicated that he will not allow UN investigators to question him about the assassination, but the US has warned Syria that it must upgrade its cooperation with investigators or face further action.

"The step aims to avoid any future disturbances," said Dureid Dergham, head of the Commercial Bank of Syria.

He said the move was necessary "in light of the current US threats against Syria, and the ensuing complications in banking procedures and transfer operations to Syria from US and European banks".

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