Violence erupted in Yemen as the country’s currency, the riyal, hit a record low, leading to protests and civil unrest in several cities. The Yemeni riyal fell to 1,500 per dollar, marking a significant decrease from the previous exchange rate of 1,300 in May. This sudden depreciation has caused outrage among the population, leading to road blockades and the closure of businesses in protest.
The deteriorating economic situation and the falling value of the riyal have sparked widespread demonstrations and calls for civil disobedience. Previous protests in Al-Mukalla and Aden turned violent, resulting in casualties. The escalating crisis prompted the Yemeni government to intervene, with the Chairman of the Presidential Leadership Council, Rashad Al-Alimi, vowing to halt the currency’s decline and regulate the exchange markets.
The riyal’s value had initially stabilized at 1,200 per dollar in early 2022 when the government returned to Aden and received a $1 billion deposit from Saudi Arabia. However, peace efforts in Yemen stagnated, and the presidential council faced challenges that forced them out of the country. As a result, the riyal began a downward spiral, reaching its current low of 1,500 per dollar.
Local traders have expressed their frustration by refusing to buy and sell goods until the riyal stabilizes. They complain that only prominent retailers accept the Saudi riyal, exacerbating the situation. Furthermore, the prices of essential goods, such as flour, sugar, and cooking oil, have soared by 20%, leaving small businesses in a precarious position.
Experts attribute the currency crisis to Houthi drone attacks on oil facilities and the halt of oil exports, driving the government towards bankruptcy. The government’s options to address the crisis are limited, including requesting financial assistance from Saudi Arabia and international donors.
To compound matters, the Houthis have disrupted the government’s access to gas and tax money, thus destabilizing the country even further. They have also imposed restrictions on gas tankers entering their territory from government-controlled areas. This dire situation has pushed the Yemeni government to rely on external support to overcome the currency crisis.
In conclusion, Yemen is grappling with violent protests and civil unrest as the value of the riyal plummets to a record low. The government has pledged to take urgent action to stabilize the currency and regulate the exchange markets. However, the situation remains precarious, with the economy teetering on the brink of collapse.
