Hunger Now Primary Threat To Yemen’s Population

The collapse of the Yemeni currency, now valued at 600 riyals to the U.S. dollar, is plunging Yemen toward a terrible economic disaster: shops are closing, protests are spreading, and a woman is being threatened with eviction because she cannot pay a mere $16 per month in rent, while her children go to bed hungry.
Hunger is Primary Threat to Population of Yemen
Photo Credit: UNHCR/Rawan Shaif

Um Assil, a 43-year-old mother of three, cannot imagine how long she and her children can survive without food, income, or medical care. Safa Habel, the owner of Be+ Initiative, told Inside Arabia that “this woman, threatened by the landlord, is being evicted with her children from a small four wall room.” She pays a monthly rent of 10,000 riyals ($16 after the collapse of the currency). “Her condition is getting worse because of the war and the alarming price hike. She sent her husband, who is suffering from a psychological condition, with her eldest child to the countryside. She has stayed with her two other children to look for charitable help to fill their bellies.” She added: “She is now the breadwinner of this family; without work, her husband without treatment, and her children often go to bed without food.”

“Yemenis have no salaries and no government, and political parties have failed the people and traded on their suffering.”

Safa works to help dozens of families through her initiative, which raises funds and provides assistance to the most needy families. But in recent months, she has been unable to determine who among Yemenis are the most desperate. “All people need help and support, especially with the collapse of the currency,” she said. “Yemenis have no salaries and no government, and political parties have failed the people and traded on their suffering.”

The decline of the Yemeni riyal against foreign currencies is accelerating. Currently valued at 600 riyals to the U.S. dollar, the currency collapse has exacerbated the high prices of goods, which has led to anger and protests. Aden, the temporary capital in the south of Yemen, has experienced popular protests by hundreds of citizens that began last August. These protests later spilled over into the city of Hadramout, where protesters closed the main roads of Aden and burned tires. On September 2, they demanded that the government act urgently to stop this collapse.

Yemeni activists have launched a campaign on social media under the hashtag (in Arabic) #Coalition_failed_Yemeni_People to protest against the Saudi-UAE-led coalition’s failure to intervene and prevent the Yemeni riyal from collapse. Khalid al-Ruwaishan, the former Yemeni Minister of Culture, said in a post on Facebook: “The coalition was supposedly formed to save Yemen from Houthis, but instead it went to save the Hashemite Kingdom of Jordan.” He continued, “While Yemen is dying and its currency is collapsing, the coalition is watching.” He stressed that the coalition contributed to the collapse of the Yemeni currency through the expulsion of Yemenis from their jobs in Saudi Arabia.

Angry protesters in Aden burned huge pictures of Mohammed bin Zayed and bin Salman, leaders of the coalition.

At the beginning of the coalition’s intervention, Yemeni currency was valued at 215 riyals to the U.S. dollar; now, the value of the currency has collapsed to 600 riyals to the dollar. This has caused food and fuel prices to triple.

Life is getting harder for most of the population and the government is unable to resolve the problem. The humanitarian situation in Yemen, where living conditions are horrifying, is on the verge of a catastrophe. The United Nations Secretary-General described the situation in Yemen as the “world’s worst humanitarian crisis.” More than 22 million people–most of them children–are in desperate need of humanitarian assistance, according to UNICEF.

The currency value has collapsed despite measures taken by the Yemeni government and the Central Bank of Yemen. Those measures appear to have been mere formalities, an attempt to control currency exchange agencies without taking into account that they are subject to market factors of supply and demand. In addition, the country’s major dependence on importing food and medicine means that providing foreign currency is essential.

After Houthi rebels took control of the capital, Sanaa, in late 2014, the riyal began to deteriorate. Houthis seized the accounts of sovereign wealth funds and public and private institutions under several names such as “war effort.” They also imposed taxes on private sectors and traders, and drained the $5 billion cash reserve, according to a study entitled War Economy in Yemen.

President Hadi’s government has aggravated the disaster through a number of measures, including pressure on the state’s public treasury through inflating the expenses of the government residing abroad and adopting salaries in US dollars for a huge number of officials and diplomats. The government’s corruption is manifest in “taking Yemen’s budget and spending it outside the country because the government is residing outside the country, through buying real estate and assets in Arab and other countries, and investing large sums in banks,” said Abdul Wahid al-Awbalim, a researcher, in a statement to  Inside Arabia. “There is a black hole devouring liquidity under names such as purchased energy. . . and funds for fake military priorities which go to the leaders,” he added.

The economic situation in the country is getting worse, and since the beginning of August, a number of shops have begun to close in Aden, Sanaa, and a number of other cities for fear of bankruptcy. Prices are constantly rising, and the currency is falling apart.

Revenue is not being allocated properly, another cause behind the collapse of the currency. Before war began, Yemen’s oil and gas revenues accounted for 70% of the country’s total revenue. Although a number of oil companies have resumed their production, none of these revenues are part of the country’s income. They could, in fact, make a difference through injecting liquidity and bringing in foreign currency. However, the government announced broad austerity measures at the beginning of 2018 that did not include oil and gas revenues.

Peace is the only solution to overcoming this humanitarian catastrophe. The UN-led “peace negotiations” have done nothing to ease the suffering. On September 5, peace negotiations in Geneva were supposed to be resumed, but the Ansarullah (Houthi) delegation was not able to attend. They accuse the coalition of preventing them from attending, and the UN could not grant them permits.