How Will the ‘Battle for Damascus’ Resonate in Beirut and Baghdad?

A Syrian anti government fighter poses for a picture in front of one of the water wheels, or norias, of Hama, after forces captured of the city of Hama on December 6, 2024. (Photo by OMAR HAJ KADOUR / AFP)
A Syrian anti government fighter poses for a picture in front of one of the water wheels, or norias, of Hama, after forces captured of the city of Hama on December 6, 2024. (Photo by OMAR HAJ KADOUR / AFP)
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How Will the ‘Battle for Damascus’ Resonate in Beirut and Baghdad?

A Syrian anti government fighter poses for a picture in front of one of the water wheels, or norias, of Hama, after forces captured of the city of Hama on December 6, 2024. (Photo by OMAR HAJ KADOUR / AFP)
A Syrian anti government fighter poses for a picture in front of one of the water wheels, or norias, of Hama, after forces captured of the city of Hama on December 6, 2024. (Photo by OMAR HAJ KADOUR / AFP)

The chances of the Syrian conflict turning into an open and possibly long-lasting war between competing regional powers are growing, following a sudden shift in the balance of power.

For years, foreign forces have been drawn to Syria, using their military strength to support President Bashar al-Assad’s government.

The conflict reached its height after 2011 when Iran’s Revolutionary Guard and allied Iraqi factions, backed by Russia, joined the civil war. At the same time, the United States stationed troops in Syria to fight ISIS.

Later, key international players agreed to a political deal to reduce tensions, known as the “Astana Process.” However, Iran kept its military presence to secure the supply route between Tehran and Beirut, while the US set up military bases in northeastern Syria.

Roots of 2011

Response: When the Syrian uprising began in 2011, before it turned into a civil war, Türkiye was uncertain about its political and military options. The Turkish National Security Council spent weeks in May 2011 reviewing reports on the "Syrian crisis" from Hakan Fidan, then head of intelligence and now foreign minister.

Two years later, Türkiye saw Iran's Revolutionary Guard, Hezbollah, and Iraqi militias taking positions in Syria. Meanwhile, Türkiye focused on countering Kurdish forces in northern Syria with support from Arab allies. It also hosted millions of refugees, creating both an economic burden and political tensions at home between the ruling AKP and opposition CHP.

Extremist Groups: ISIS and other extremist groups expanded across Syria and Iraq, prompting a range of forces to join the fight. These included the US-led coalition, Kurdish factions, Iran’s Popular Mobilization Forces, the Revolutionary Guard, and the Syrian army.

Russian Role: Russia entered the Syrian conflict at a time when it was not yet focused on the war in Ukraine. It took control of Syria's coastline, strengthened its presence in the Middle East, and deepened its alliance with President Bashar al-Assad.

Syria’s ‘Al-Aqsa Flood’

Tehran and Moscow: After the ceasefire between Hezbollah and Israel in Lebanon, Iran found itself unable to act. When Syrian armed factions launched a rapid advance beyond Aleppo and Idlib, Iran did not respond clearly. Meanwhile, Russia was too focused on the war in Ukraine to intervene.

Turkish Timing: Türkiye made its move clear, with President Recep Tayyip Erdogan stating just days ago that the situation in Syria is "managed calmly," showing Türkiye’s intentions to act ahead of others towards Damascus.

Syrian Factions’ Organization: The opposition groups fighting against both Assad and Iran showed increasing organization last week. While their leaders are linked to radical movements, the groups have so far avoided war crimes, maintaining discipline. It remains to be seen if this continues.

Syrian Army: The Syrian army’s retreat was notable as cities fell, including those after Aleppo. This could indicate a political decision to avoid fighting, weakening any political solution, or that the army is too weak and disorganized to protect the cities.

Battle for Damascus

“Iran’s options are now limited,” says an Iraqi political advisor who recently visited Washington and heard “new” views on Syria.

“Tehran has no bargaining power left, which makes it more dangerous if it decides to act with no political leverage,” the advisor warned.

Historically, Iran has never allowed Assad’s fall. However, sending forces now to support Assad would mean declaring war on Türkiye, especially with Russian hesitation and US indifference.

In Baghdad and Beirut, risks are growing as factions advance toward southern Syria, reaching the town of Qusayr and heading toward Damascus.

Iraqi faction leaders say, “Baghdad is tightening the pressure for the first time in years,” but “the religious and ideological factors won’t be easy to manage” if Syria’s minority groups or Shiite shrines in Damascus are threatened.

This depends heavily on the actions of the Syrian factions.

They acknowledge that moving now is difficult due to limited time, resources, and supply lines. However, retaliation could soon start in Beirut and Baghdad.



Cash Shortage Squeezes Gaza Residents

Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
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Cash Shortage Squeezes Gaza Residents

Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)
Palestinian children queue for a hot meal at a charity kitchen in Gaza City on April 30, 2025. (Photo by Omar AL-QATTAA / AFP)

Even when food is available, many in Gaza cannot afford to buy it, as the enclave suffers from a severe cash shortage. Israel has blocked the entry of new currency into the territory since October 7, 2023, leaving residents at the mercy of money changers who have hiked exchange rates on remittances to exorbitant levels.

Palestinians in Gaza primarily rely on the Israeli shekel for daily transactions, which used to enter the strip through banks operating under the Palestinian Monetary Authority, supplied by the Bank of Israel.

Banking operations in Gaza have ground to a halt since the start of the war, and no fresh banknotes have entered the enclave, worsening an already dire humanitarian situation. Residents say they have been left at the mercy of traders who exploit the cash shortage to impose arbitrary rules on currency use.

'The Traders’ Game'

Dubbed “the traders’ game” by many in Gaza, the practice began with merchants refusing to accept worn-out banknotes and certain coins, such as the 10-shekel piece (worth about $3), which have all but vanished from local markets. Some vendors now reject older versions of bills - like the brown-hued 100-shekel note (around $28) - insisting instead on the newer yellow ones. The same rules apply to various denominations.

Speaking to Asharq Al-Awsat, Hani Jahjouh, a resident of al-Shati Camp west of Gaza City, said vendors selling vegetables and essential goods - when available - often refuse worn banknotes or specific coins, claiming they are counterfeit or easily faked.

“This just adds to the burden of people already crushed by impossible living conditions,” said Jahjouh, 59. “We don’t have solutions. We don’t even know where to get the money they’re asking for.”

Only a very small number of traders accept digital payments, and even then, residents say, they impose tough conditions - such as inflated prices or demands for partial payment in cash.

Displaced Gazan Duaa Ismail, originally from Beit Hanoun in the north of the enclave, says even when goods are available, she cannot afford them due to a lack of cash.

“We’re suffering badly from a shortage of money, and that makes it even harder to get basic items like flour and sugar - when they’re even in stock,” she told Asharq Al-Awsat from a shelter in Gaza City’s Sheikh Radwan neighborhood.

Ismail said that during a brief ceasefire, some traders had accepted digital payments through mobile apps. “But once the war resumed, things worsened, and they stopped taking them altogether,” she said.

Salaries They Can’t Spend

The crisis has also hit public-sector employees, private workers, and international aid staff, many of whom receive salaries through bank transfers or mobile wallets but have no way of accessing their funds with banks shuttered. They are forced to rely on currency dealers or traders with access to physical cash.

Amjad Hasballah, an employee with the Palestinian Authority, said he has been cashing his monthly salary through mobile banking apps for over a year and a half, paying a steep commission to money traders in return.

“When I received my last salary in early April, the commission had reached 30%,” he said.

Speaking to Asharq Al-Awsat, Hasballah explained that at the start of the war, commissions hovered around 5%, but they spiked during Ramadan, peaking at 35% around Eid al-Fitr, before dipping slightly to 30%.

“My salary is just 2,800 shekels. When I pay a 30% fee, there’s barely anything left,” he said bitterly. “At this point, the traders might as well take the whole salary and just give us pocket money.”

Caught in a Trap

Jamal Al-Mashal, a father of six who lost two children in an Israeli airstrike, said he lives off 1,000 shekels (about $280) in monthly international aid. But even that amount is slashed by up to 30% when he exchanges it through local traders.

“People in Gaza have become a cash trap for currency dealers and big traders,” he said. “They’re exploiting our desperation, and it’s like a harvest season for them - raking in profits while we suffer.”

The poorest and most vulnerable are hit hardest. Many international agencies rely on electronic payment platforms to distribute aid to these groups, who often have no access to physical currency.

No Oversight, No Restraint

The Hamas-run government has made attempts to cap commission rates at 5%, but those efforts have largely failed. Officials blame ongoing Israeli targeting of personnel involved in regulating the process.

Money changers defend the high fees, arguing that the lack of currency entering Gaza leaves them with limited options.

“We raise commission rates because there’s simply no new cash coming in,” one trader told Asharq Al-Awsat. “Once money is distributed to the public, we have no way of getting it back. What goes out doesn’t return.”

He added that while ministries and law enforcement have tried to impose limits, traders view the rules as unfair. “There have been attempts to regulate us, but we haven’t complied - they’re asking too much from us under impossible conditions,” he said.

Some municipal leaders and community elders in Gaza have recently appealed to the Palestinian Monetary Authority in Ramallah to intervene in what they describe as unchecked profiteering by traders controlling access to scarce cash.

They have called for greater oversight, including monitoring and freezing the traders’ bank accounts.

The authority has repeatedly warned against exploitation of civilians and threatened to take action. But in practice, traders continue to charge hefty commissions on money transfers with little deterrence.

The Authority has urged residents to use its Instant Payment System available through mobile banking apps, which it says offers a practical alternative to cash, promotes digital payments, and enables real-time transactions.

Cash Squeeze Tightens Further

Despite the hardship, Israel is considering new measures that could further tighten the financial stranglehold on Gaza. One proposal involves withdrawing the 200-shekel banknote (worth about $55) from circulation, on the grounds that Hamas allegedly uses it to pay salaries to its fighters.

The suggestion was reportedly made by Israeli Foreign Minister Gideon Sa’ar to Bank of Israel Governor Amir Yaron, who rejected the move. Other proposals include voiding the serial numbers of banknotes believed to be inside Gaza, effectively rendering them worthless, a step that could deliver a significant financial blow to Hamas.

According to a report published Tuesday by the Israeli daily Maariv, the proposal has backing from several ministers and economists both within and outside the central bank.

The report estimated that around 10 billion shekels in high-denomination bills - 100 and 200 shekels - remain in circulation within Gaza. These notes entered the enclave over the years through official banking channels supplied by the Bank of Israel.

Economists told Maariv that Gaza residents receive an estimated 150 to 200 million shekels each month through digital transfers from aid organizations and the Palestinian Authority. That money is then converted into cash within markets dominated by Hamas and supported by a network of money changers.

Israeli security sources estimate that Hamas has accumulated up to five billion shekels since the war began and has spent nearly one billion shekels on salaries for fighters and new recruits. The sources claim Hamas has profited significantly by reselling aid and fuel at inflated prices during the conflict.