Houthi attacks on oil drag the Yemeni riyal to a new low
English - Thursday 15 June 2023 الساعة 04:26 pm
Aden, NewsYemen, exclusive:
The Yemeni riyal witnessed a new accelerated collapse against foreign currencies significantly in the past few days, with the latter continuing to rise on a daily basis, accompanied by inflation in the prices of food commodities.
The Yemeni riyal recorded 378 per Saudi riyal, and 1,380 per dollar, in a noticeable collapse despite the statements of the Governor of the Central Bank of Yemen, Ahmed Ghaleb Al-Mabaqi, who denied recent rumors about the depletion of the bank's reserves of hard currency, stressing that the bank's reserves of hard currency are "better than he imagined." It enables it to carry out its basic functions by preserving the stability of the local currency and maintaining prices within possible limits.
The collapse coincided with the rise in the prices of important basic food commodities, as well as the prices of vegetables, which exhausted even middle-income people in the capital, Aden, and the liberated areas.
International economists have explained that the imbalance is latent in the economies of some Arab countries, related to the fact that they are consumer economies, and are not productive in most of them, with the exception of the Gulf countries that depend a lot on an internationally required commodity, which is gas and oil.
The Yemeni economic researcher, Abdullah Bashraheel, said in a press interview, "The terrorist attacks of the Houthi militia on the oil sectors, targeting ports and oil tankers, and disrupting the export of crude oil, in addition to the lost revenues since the armistice agreement and the easing of customs and tax duties for fuel ships, have affected the gross domestic product." The total increased by 50%, according to previous reports of the Central Bank, which reflected negatively on the exchange rate.
Although Yemen possesses gas and oil, the revenues and revenues of Marib and Hadramawt oil do not belong to the centers of Aden or the state, while many revenues such as "communications" estimated with huge amounts belonging to the Houthi militias, unlike the division of the Yemeni currency and the government's salaries in hard currency, and hundreds of fussile exchange shops at prices all and more are the most prominent factors of the collapse Yemeni riyal.
Economic stability solutions
- Finding a political solution to the ongoing conflict in Yemen, as soon as political solutions or peace agreements are announced, it will contribute to the stability of the riyal.
- Supporting the industrial and agricultural sector: Productivity and quality must be improved in the agricultural and industrial sector, and farmers, producers, and factories should be supported with equipment, technology, training, and financing to improve production and export.
- Fighting corruption: Corruption must be vigorously combated and public money, natural resources and trade management should be improved to improve confidence in the government, boost investment and improve economic conditions.
-Infrastructure development: The infrastructure in Yemen must be developed, including transportation networks, roads, ports, airports, energy and communications, in order to facilitate transportation and trade, attract investments and develop economic sectors.
- Supporting banks and financial institutions: Banks and financial institutions in Yemen must be supported to provide soft financing for economic projects and to encourage investments and trade.
International cooperation: International cooperation must be strengthened with donor countries and international organizations to provide financial, technical and developmental support to Yemen and improve its economic and social conditions.
These are some of the proposed solutions, and it is important to implement them in a coordinated and integrated manner to improve the economic conditions in Yemen.
