G19 confirms support for Yemeni CBY plan to stabilize rial

Riyadh (Debriefer)
2019-04-10 | Since 5 Year

اضغط هنا لقراءة الخبر بالعربية

Ambassadors of the G19 on Yemen on Tuesday expressed support for the Central Bank of Yemen (CBY) in carrying out the emergent action plan to help stabilize the local currency, enhance economy and improve the people's living conditions.

In a joint statement carried by the CBY Facebook account, the envoys also announcedtheirsupportfor the government measures banning illegal oil imports, the UN-supervised political process and efforts exerted by the UN Envoy Martin Griffiths.

Yemen has been racked by an armed conflict that broke out after the Iranian-backed Houthis had ousted the internationally recognized government late in 2014.

The conflict escalated after a Saudi-led coalition intervened militarily in the country in March 2015 to reinstate the government of President Hadi.

On 24 March, the CBY said an urgent action plan would be soon implemented in order to help stabilize the local currency, Yemeni rial, suffering spiral decline.

The plan aims at restoring stability of the rial and covering import needs, said the CBY based in Aden, seat of internationally recognized government. "This is of great importance for improving the country's economy and the citizen's humanitarian and living conditions."

The plan would also rehabilitate the exchange industry, which has been abused by outsiders, according to statement by the CBY.

The G19 ambassadors said they were worried about the depreciation of Yemeni rial and the fragile economy, applauding Saudi economic support for Yemen.

Economic development is important for alleviating Yemenis' suffering, said the joint statement, highlighting the need for microeconomic enterprises to be backed and for humanitarian and commercial goods smooth inflow to be sustained via Hodeida and Salif ports.

Envoy welcomed, and called for further,efforts made by the Yemeni government towards the payment of all civil servants wages, most of which have been stopped since September 2016 when Hadi decided to move the CBY to Aden.

Despite its promises, the government has failed to pay the salaries in Houthi-held areas, insisting on the deposit of all state revenues into Aden-based CBY, request rejected by the rebels.

Last Tuesday, the CBY introduced new standard mechanism that would be used between the Bank, local commercial banks and oil importers to cover oil imports, although the government-held areas are provided with oil by sole supplier, Arab Gulf company.

The Yemeni rial lost more than three quarters of its value against the US dollar, leading to price hike as many Yemenis unable to afford food and other basic commodities, particularly the unpaid government employees.

On Friday, Houthi authorities warned of the "worst catastrophe in history" if the Yemeni government and backing coalition kept on preventing vessels from reaching Hodeida port.

The Red Sea city of Hodeida and its ports have been under Houthi control since late 2014, while Yemeni joint forces loyal to legitimate government and Arab coalition have massed at the city's fringes since last November seeking to retake the strategic port.

The UN panel tasked with monitoring of sanctions on Yemen saidlast January, in its 2018 report, that Houthis received at least US$ 300 million a year in revenues of fuel shipped from Iran's ports to fund their war against the Saudi-backed official government of Hadi.

The rebels also collect annually some US$ 740 million in the form of revenues from firms and permit fees from communication, tobacco and other companies, according to the report.

Fees imposed on fuel imports through Hodeida port provide the Iranian-backed group with no less than US$ 300 million, in addition to revenues from fuel sold at black market, the paned said noting that the Houthis had several resources including customs levies collected at rebel-held Red Sea ports and Dhamar City.

The 4-year war has pushed the country to the world's worst humanitarian crisis, according to the UN, with most of the population in need for a type of humanitarian aid and immediate protection, including 14 million people risking famine and some 1.8 million children suffering malnutrition.

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