Economic competition between North and South severely affected prices
English - Sunday 07 March 2021 الساعة 02:33 pm
Aden, NewsYemen, Exclusive:
The prices of food commodities, fuel and services continue to rise in the local market, driven by the depreciation of the riyal against foreign currencies, where the "dollar" is approaching the barrier of 900 riyals in the south, and 605 riyals in the north, the areas controlled by the Houthi militia.
The Center for International Research and Markets, in its report "Macroeconomic Outlook for the Middle East to 2025", emphasized that economic competition between North and South strongly affected prices, especially on fuel.
He added that, given the already poor food security situation, Yemenis could not absorb more shocks.
The economic war focused on two areas: controlling fuel imports and controlling the currency, and both crises triggered a 25% rise in prices, compared to 2019, and a fuel shortage, which led to disruption of health, water and sanitation services.
The competition over regulation and taxes on fuel imports between the two parties to the conflict has contributed to another decline in the value of the riyal and a rise in food prices, which is far beyond what most Yemenis can afford.
The Houthi militia continues to develop policies to protect its own economic areas, such as the ban on the use and circulation of newly printed banknotes in its areas of control, to limit the government's ability to implement an effective economic policy at the state level.
According to the report of the United Nations experts on Yemen, the Houthi militia withdrew 50 billion riyals from the funds deposited from the Central Bank of Yemen branch in Hodeidah, from collecting import tariffs for commercial oil shipments in the salary initiative account, in implementation of the economic part of the Stockholm Agreement that sparked the economic war again.
The Houthi militia also created customs barriers on the outskirts of its areas of control, raising them to 50%, which caused the reduction of trade between the governorates.
The escalation in the economic war between the conflicting parties caused the devaluation of the local currency "riyal", the rise in the prices of fuel, water and food, and doubled the cost of living.
