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Prices Soar in Yemen as Currency Collapse

Republican Yemen – Sami Almaqtari

The Yemeni currency, the riyal, keeps dropping amid the five-year war and the outbreak of the coronavirus pandemic, worsening the humanitarian situation that is already the world’s worst humanitarian crisis in modern history.

The Yemeni riyal has deteriorated to a very low value in the financial market, with 715 riyals to the US dollar in Yemen’s interim capital Aden, where the UAE-backed Southern Transitional Council (STC) declared self-rule from the internationally recognized government, resulting in skyrocketing prices.

Residents expressed concerns over the deterioration of the currency as the costs of goods and basic services soar.

Ahmed Mansour, 37, who is a father of four children accused the government of carelessness saying it has failed to stop the collapse of the currency or provide the very basic services for its people.

“My salary can’t provide me and my family the basics we need. Our currency’s worth is almost nothing and our government doesn’t seem to bother,” Ahmed said. “They (the government officials) don’t feel what we are going through because they get paid with a foreign currency.”

Nageeb Saeed, a retail store owner, told Republican Yemen that it has become even harder to make ends meet due to the collapse of the currency.

“Costs for everyday goods rise on a daily basis. When we ask wholesale merchants why they impose costly prices for the goods, they say they import them using US dollar,” Nageeb explained.

“Three days ago the cost of a bag of rice was about 20000 riyals. Today it is 250000, meaning I made no gains when I sold it. We are all suffering from this,” said Nageeb.

In mid-May, Yemen’s Central Bank evacuated its staff and warned of suspending activity after it was besieged by militias of the STC, which seek to dictate the Central Bank to adhere to a new policy of their own.

The currency in Sana’a, where the Iran-linked Houthis take control, appears to be a bit better in terms of the exchange rate compared to Aden, with 615 riyals to the US dollar.

The reason why there is a variation in the exchange rate of the currency is that the militia has banned the new banknotes issued by Aden-based Central Bank that is run by the legitimate government.

But this does not reflect the reality of life in areas under Houthi control knowing the militias have deprived people of their salaries for months.

“It is true that prices are somewhat lower here in Sana’a, but what benefits do we, the people, get when we have no money to buy what we need?” Ramzi Mohammed Ahmed, an Arabic teacher, said.

“A friend of mine was believed to be infected with Covid-19 and died in his home because he could not afford to get medical treatment in a hospital,” Ramzi continued.

In 2014, the exchange rate of the Yemeni riyal was 215 riyals to the US dollar. The currency, however, started dropping when the Iran-aligned Houthi militias stormed the capital Sana’a and staged a coup against the Yemeni legitimate government, in September 2014, leading to the formation of an Arab coalition led by Saudia Arabia to restore state and end the Houthi coup.

Neither Houthis nor the Yemeni government or the STC are affected by the collapse of the Yemeni currency. It is the people who are destined to go through hell.

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