Yemen’s Al Houthis set import cap, suspend dollar buying

The Al Houthi militia that controls parts of Yemen is setting a cap on imports and temporarily banning traders from buying dollars in an attempt to stop the decline of the local rial currency, according to a document seen by Reuters.
The moves could aggravate a food crisis in the Arab country, already ravaged by war, hunger and disease.
The document was issued after a meeting on Monday in the capital Sana’a between Al Houthis’ deputy prime minister for economic affairs, Hussain Maqbouli, and representatives of banks, money changers and importers of wheat, flour, and fuel.
It said the trade ministry had been asked to set a ceiling on imports and to prepare a list of essential goods needed for the whole of 2017, suggesting a move to ration imports to cope with the financial crisis.
The meeting agreed that importers of wheat, flour, fuel products, telecommunications equipment and tobacco will “stop buying dollars for 30 days, and to oblige money changers not to sell or speculate”, according to the document.
Nearly two years of war between a Saudi-led Arab coalition and the Al Houthi movement, which is aligned to Riyadh’s arch-rival Iran, has left four-fifths of the population in need of aid.
The war has split the country between two power centres: the southern city of Aden, controlled by the internationally recognised government of President Abd Rabbo Mansour Hadi, and the Al Houthi-run capital Sana’a. Both have suffered from the unstable currency.
The Sana’a meeting came about following a sharp drop in the value of the riyal, which was trading at 385 to the dollar in Aden and up to 330 in Sana’a. It had been around 310 for most of the past three months.
Officials from the Houthi group could not immediately be reached for comment.
Money changers in Aden, worried by instability and speculation in the market, also suspended trading in foreign currency on Tuesday over the sharp drop in the value of the riyal, which some said had increased since Hadi’s government pumped some 200 billion riyals (Dh2.94 billion) printed in Russia into the market in January.
Last week, the UN Food and Agriculture Organization said Yemen’s estimated supplies of wheat would run out at the end of March.
The financial situation has became more chaotic since Hadi’s government decided to move the central bank from Sana’a to Aden and name a new governor. The Al Houthis rejected the move, leaving two rival central banks operating in the country.
The confusion has pushed many Yemenis toward destitution after months of unpaid salaries.
Officials said that the central bank under the control of Hadi’s government was due to meet money changers in Aden to discuss ways to stabilise the riyal.

Source: DUBAI