Local Editor
Yemen’s central bank has told traders and local banks it will no longer provide lines of credit for the import of sugar and rice at the official exchange rate, merchants and local bankers said on Friday.
The move takes immediate effect and is likely to further deepen the country’s humanitarian crisis. Yemen is in the midst of a war between the Houthi Ansarullah movement, who control the capital Sana’a, and fugitive former President Abd-Rabbu Mansour Hadi’s government, which is backed by an Arab coalition led by Saudi Arabia.
One merchant told Reuters that until the beginning of February, the central bank had covered all the country’s import needs of medicine, wheat, rice, sugar and milk at the official exchange rate of 215 riyals to the dollar.
"With this decision, the lines of credit would be limited to wheat and medicines only," said the merchant, who asked not to be named.
A banker confirmed this, saying the central bank had explained it was no longer able to provide cover for imports at the official rate and had asked merchants to buy foreign currency on the black market, where the rate is 256 riyals to the dollar.
The U.N. Food and Agricultural Organization (FAO) has warned of a "staggering" crisis, saying famine looms as over half the population, or some 14.4 million people, are short of food.
Saudi Arabia began its deadly campaign against Yemen in late March 2015. The strikes were meant to undermine the Houthi Ansarullah movement and restore power to fugitive former president Abd Rabbu Mansour Hadi.
About 8,300 people have been killed and over 16,000 injured since Riyadh launched the airstrikes. The Saudi aggression has also taken a heavy toll on Yemen’s facilities and infrastructure.
Source: News Agencies, Edited by Website Team
