Analysis: The Houthis want to determine the state’s income under the pretext of paying salariesEnglish - Monday 25 September 2023 الساعة 10:02 am
An analysis published by the Arab Center in Washington confirmed that the Houthi militia, Iran’s arm in Yemen, under the pretext of paying salaries, wants to enjoy the state’s revenues by obtaining oil revenues.
The analysis said that, under the pretext of paying the salaries of the civil and military sectors, the Houthis are demanding a large share of oil revenues. After launching attacks on the oil ports in Mukalla and Shabwa and stopping the export, he explained that stopping the export of oil and banning the Houthis from locally produced gas cylinders coming from Ma’rib is the main goal of weakening the financial resources of the Yemeni government and undermining its sources of revenue.
He pointed out that the Houthis want to enjoy state revenues and obtain oil revenues, as one of the group's central economic goals, and the group has repeatedly tried unsuccessfully to seize the oil-rich Marib Governorate.
The analysis, prepared by Afrah Nasser, a researcher at the Arab Center in Washington, under the title “Yemen’s War Economy: A Key Factor in the Ongoing Conflict,” said: “Decades of unaddressed economic grievances and conflicts have provided fertile ground for the emergence of a dynamic war economy in Yemen.” “It is characterized by complex networks of actors all competing for economic power and control,” he said, explaining that Yemen’s war economy essentially revolves around resource allocation, organization, and mobilization, with the main goal of continuing the fighting.
Researcher Afrah Nasser noted that profiting from war and exploiting its various dimensions led to prolonging the conflict and impeding the achievement of lasting peace and lasting stability. In addition, the far-reaching impact of the war economy changed the country's landscape and its social and economic structure in complex ways.
She explained that the dispute between the warring parties over taxes and customs duties led to the creation of a divided tax system in the country, with each party imposing its own tax system. And its tariffs and customs duties, explaining that the government imposes customs duties when any goods arrive at the ports under its control. Then, when traders move through internal crossings to deliver those goods to areas under Houthi control, they are imposed additional customs duties, as the Houthis claim to be the legitimate government authority in the north.
The analysis confirmed that the Houthis doubled their restrictions on merchants when they imported materials to areas through ports or land crossings with a 100 percent tax. These dual tariffs drain the economic power of traders and increase commodity prices dramatically.
He pointed out that the Houthis' move aims to strengthen the group's economic power, and has already begun reaping profits, collecting at least $1.8 billion in taxes and state revenues in 2019 alone.
The analysis pointed out the violations that humanitarian aid is subjected to in order to achieve economic benefit, especially after reports of various international organizations, including the United Nations, humanitarian agencies, and human rights organizations, revealed a pattern of interference in the distribution of humanitarian aid in Yemen.
The researcher pointed out that varying humanitarian aid, restrictions, and obstruction are some of the economic strategies that the warring parties used to enhance their influence. In 2020, Houthi militias engaged in money laundering and corruption practices, which had negative consequences for people's ability to access adequate food supplies. In addition, the Houthis have been implicated in the exploitation of humanitarian aid, and the World Food Program has acknowledged that the group's aid varies in areas under its control. This diverted aid then makes its way into the Houthi war effort.
The analysis pointed out that the financial resources of ordinary citizens went towards filling the pockets of the warring parties. High tariffs and spikes in commodity prices are part of the “extractive economy” that the warring factions inflict on the population at large. As thousands of civil servants have had difficulties receiving their salaries for years, they have been living off their hard-earned savings, which in many cases have likely been completely exhausted.
The researcher said: “It is almost certain that the majority of people in Yemen have spent all their savings, considering that Yemen is one of the poorest countries in the world. Their money was seized by greedy warlords who possess weapons and power. The systematic extraction and depletion of the people’s wealth, or rather the transfer of wealth from... The citizen to the political and military elite is one of the main manifestations of the war economy, and has led to a widening of the gap between the rich and the poor.
The analysis of the Arab Center in Washington explained that the important impact of the war economy on the future of Yemen is to prolong the conflict. The economic gains that the warring parties continue to achieve during the war provide little incentive to end the conflict, as evidenced by the fact that the truce expired in October 2022 and has not yet been renewed, indicating that in this disheartening scenario, Yemen's future prospects become bleak due to the ongoing conflict.