Infighting and economic woes complicate situation in Yemen
ADEN - The situation in Yemen became more complicated for the internationally recognised government of President Abd Rabbo Mansour Hadi after the Southern Transitional Council (STC) — an ally in the fight against Houthi rebels — called for an uprising.
“The southern people have the legitimate right to stage an uprising due to the rampant corruption and the starvation policies exercised by the government,” STC said in a statement.
The Hadi government issued a statement against “all forms of rebellion, be it Houthi or separatist and all acts of terrorism.” The government called on political and social elites, unions and media organisations in the south to “reject acts of chaos, vandalism and riots which would put the nation’s security and stability at risk.”
Fighting between the UAE-backed STC and the Saudi-backed Yemeni government, ostensible allies against the Houthis, has broken out sporadically since that start of the war in 2014.
The call from the STC drew mixed reactions in the government-controlled south.
The Rally of Southern Civilian Forces warned against what it called a “south-south conflict, which would only serve the Houthis” and their plan to take over the country. The group pointed to its attempts “to narrow an ever-widening rift between the legitimate government and some groups whose main stated goal is to unseat it.”
The Southern Religious Authority, distancing itself from the call, asked for “wisdom” in addressing conditions in Yemen and urged parties to cooperate.
However, Sheikh Hani al-Yazidi, general director of Aden’s al-Buraiqah district, welcomed the STC’s statement as “balanced and responsible.”
A further issue is the decline of the Yemeni currency, resulting in thousands of protesters demonstrating in Aden. Currency traders went on strike in Aden and Ataq. The Yemeni rial has lost nearly half its value in the last year and traded at 800 rials to the dollar on October 1, causing food and fuel prices to skyrocket.
Yemeni economists attributed the rial’s collapse to political and economic factors caused by the war, along with illegal practices by the Houthis and the poor performance of the internationally recognised government.
Yemeni economic journalist Radwan Hamdani said a prominent reason for the currency crisis was the loss of revenue to the country’s foreign reserves due to the cessation of oil and gas exports, as well as a lack of remittances from expatriates living in Yemen.
“When the government pays salaries, most of the money spent goes to buy food and other products and this leads to the accumulation of a large amount of local cash from traders and suppliers, who are turning to the already fragile banking market to buy the dollar to cover their imports,” Hamdani said, adding that that situation causes speculation that attributes to the rial losing value.
“The collapse of the currency has reached a point where it is no longer possible to operate,” a currency trader in Ataq told Al-Masdar news.
Yemeni Central Bank Governor Mohammed Zammam announced October 3 that a $200 million grant from Saudi Arabia had been deposited in Yemen.
Saudi Minister of Finance Mohammed al-Jadaan said the grant was intended to “strengthen the fiscal position of the Central Bank.” Jadaan said the grant, along with $3 billion deposited in January, reflects Riyadh’s efforts to help the Yemeni people.
“This support will improve the Yemeni economic position and enhance the Yemeni rial exchange rate, which will positively reflect on the living conditions of Yemeni citizens,” he said.
UN Special Envoy to Yemen Martin Griffiths, in an interview with Thomson Reuters, tied Yemen’s dire humanitarian situation to its economic circumstances.
“There’s no doubt in my mind whatsoever that this economic issue is now the overwhelmingly most important priority,” Griffiths said. “Within the UN we’re talking about the need for such a master plan… an immediate set of measures over weeks that the World Bank, [International Monetary Fund], UN agencies, the Gulf obviously, the government of Yemen could come together to discuss.”