Yemenis' immunity against economic crises is getting weaker every day

English - السبت 19 نوفمبر 2022 الساعة 06:27 م
Al-Mocha, NewsYemen, exclusive:

Years of indecisive fighting pushed Yemen to the brink of famine, and the opposition and retaliatory policies implemented by the Houthi militia - Iran's arm in Yemen - produced economic and humanitarian crises that weakened the material, living and moral capabilities of citizens.

The Capacity Assessment Project organization said that the economic war practiced by the Houthi militia has become the main driver of humanitarian needs in Yemen, and has caused the depreciation of the riyal and the rise in food prices, far beyond what most Yemenis can afford.

The organization stated that the Houthi militia has pushed the economy and social services to collapse, fragmented financial institutions, and millions of Yemenis are suffering from hunger and disease and are more vulnerable than a year ago.

The Houthi militia has also displaced up to 5 million people in the past seven years, and women represent half of the total displaced, 27 percent of whom are under the age of 18, according to the UNHCR.

The World Bank estimated that between 71-78% of the Yemeni population had fallen below the poverty line at the end of 2019, and the sudden decline in the annual spending rate and the ensuing inflation will have a direct and negative impact on everyone around and below the poverty line.

The United Nations reports classify Yemen as the largest man-made humanitarian crisis in the world. According to the Yemen Humanitarian Response Plan for 2022, about 23.4 million people need humanitarian assistance and protection.

Food insecurity indicators sounded the alarm, as about 19 million people suffer from food insecurity, in addition to 1.6 million people who are at emergency levels of risk of hunger, and nearly 160,000 people in Yemen face the risk of starvation unless emergency aid is provided to them.

Economic reports indicate that the Yemeni citizen's immunity against economic crises is getting weaker every day.  Stressing that the current year 2022 is the most difficult for Yemenis to live due to the repercussions of the Houthi militia war and the subsequent repercussions of the Corona virus and Russia's war on Ukraine.

Meanwhile, prices have reached unprecedented levels, as the International Monetary Fund estimated the consumer price inflation rate at about 60% in 2022, and this coincides with the salary crisis of state employees and retirees, as well as the oil, diesel, gas and electricity crises manufactured by the Houthi militia.

The Houthi militia's closure of major roads between the Yemeni governorates, in light of the increase in royalties and double customs fees at the ports and points on the roads, further exacerbated the humanitarian and living conditions of citizens.

Over the past five years, the Houthi militia's aggression has increasingly extended to the economic sphere, leading to fragmentation and deterioration of the financial sector, which in turn has exacerbated food insecurity by increasing transaction and consumer costs.

The study issued by the "Capacity Assessment Project and the International Patent Classification of Food Insecurity" confirmed that developments in the banking sector in Yemen contributed to the inefficiency of the financial system, and created negative indirect effects on food security.

According to the study issued in December 2021, these impacts include reduced food demand due to eroding purchasing power, suboptimal imported food supplies due to lack of foreign exchange, and discouraged agricultural production due to lack of credit.

The study concluded that the developments in the financial sector had indirect effects on food security, and the effects included a decrease in the demand for food as a result of the erosion of purchasing power, high prices and a decrease in family income.

It confirmed that the Houthi militia implemented opposition and retaliatory policies regarding cash circulation, liquidity management and supervision of financial institutions, which led to double exchange rates, increased financial sector transaction costs and reduced process efficiency.