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The National Team For Foreign Outreach - Yemen

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ECONOMIC SITUATION – January 2020

With the advent of the year 2020, Yemeni people are still going through a catastrophic suffering, especially since 80% of civil servants do not receive their salaries as the countries of war coalition relocated the Central Bank from Sana’a to Aden governorate in August 2016. This has led to increase in the rate of unemployment, poverty and deterioration in the basic services. This has negatively affected the lives of civil servants and their families.

The Central Bank in Sana’a revealed the causes behind the escalating humanitarian catastrophe resulting in dragging a wide segment of Yemeni citizens into the poverty line and eroding the national capital and citizens’ savings. These reasons include the following:

The countries of war coalition on Yemen deliberately carried out measures that led to the deterioration of the Yemeni currency exchange rate against the foreign currency. The exchange rate has reached more than 600 riyals against one US dollar.

Through the Central Bank in Aden, the countries of war coalition against Yemen printed new banknotes without any banking policies, and with a total amount that reached one trillion and 700 billion riyals within three years. This means that it has exponentially gone beyond what the Central Bank in Sana’a has printed during the last 40 years since its foundation.

The Central Bank in Sana’a adopted appropriate measures by issuing a decision prohibiting the circulation of the newly printed currency printed by the Central Bank in Aden instigated by the coalition countries and without any banking policy. This has contributed strongly to stopping the deterioration of the value of the Yemeni riyal in the regions run by Sana’a government (National Salvation Government), which represents 75% of the total commercial and population blocs.

The countries of war coalition on Yemen prevented the entry of more than eight ships with oil derivatives, food and medicines during this month, despite having the UN pass permit documents to enter Hodeidah seaport after inspection. This has led to increasing fuel prices, transportation costs, food prices and causing damages to hospitals, healthcare centers and facilities, especially renal dialysis centers.

The Yemeni domestic production declined by 35% over the past years of the war and the siege on Yemen; while the country’s imports of basic needs increased to more than 90% due to the destruction of the infrastructure of the economy. Sana’a government is moving ahead towards reviving local production, especially the fish and agricultural productions that have declined with more than 33%. Tens of thousands of jobs have been created through financing small, medium and micro-enterprises as a means to reduce poverty and unemployment rates and turn unemployed human capacities into working capacities. It also works on improving the means of collecting public revenues for the State in such a way that ensures ending extortion and financial and administrative corruption, and improving the outputs of technical and vocational education in line with the demands of the labor market.

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