Yemen central bank will supply banks with foreign currency

Yemen central bank will supply banks with foreign currency
Yemen's central bank is split in two, reflecting the war which pits the Saudi-backed government against Iran-backed Houthi rebels.
2 min read
23 April, 2019
Yemen's central bank will supply banks with foreign currency to import goods [Getty Images]
The central bank of Yemen, a country facing a continuing four-years war and a dire humanitarian situation, has announced it will supply banks with foreign currency to ease the flow of much-needed goods into the country, Reuters reported.

The central bank is divided into two, along the lines of the warring sides. In the southern port of Aden, the Saudi-backed government's central bank rivals that of the Iran-backed Houthi rebels in Sanaa.

This split has led to payment problems, worsening an incredibly dire situation described by the UN as the "world's worst humanitarian crisis".

The Aden branch "issued a circular saying it was ready to sell banks foreign currency at a rate of 506 rials to the US dollar or at market rates", according to Yemeni news source cited by Reuters.

This would cover "letters of credit and financing guarantees" to allow for import of goods not covered by Saudi Arabia's  $2 billion grant.

The Houthi rebels are fighting a government backed by a Saudi-led coalition. The coalition launched its first raids on rebel strongholds in March 2015 in a bid to bolster President Abd Rabbo Mansour Hadi, who was ousted and now lives in Riyadh.

Since then the conflict has killed some 10,000 people, according to the World Health Organisation, although human rights groups say the toll could be five times higher.

The unrest devastated the economy of the poorest Arab country and pushed the country to the brink of famine.

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