Saudi Arabia gives Yemen $200m to halt currency collapse

To ‘boost local currency’, Saudi has given Yemen’s Central Bank a $200m cash infusion to shore up reserves.

People wait for cash at the Central Bank of Yemen in Sanaa
The Yemeni riyal has lost nearly half its value this year [File: Khaled Abdullah/Reuters]

Saudi Arabia has given a $200m cash infusion to Yemen’s Central Bank to shore up its reserves after the war-torn country’s currency went into freefall over the past few weeks.

The state-run Saudi Press Agency said on Tuesday the “donation” will help “achieve stability of the Yemeni economy and boost the local currency”, which has lost nearly half its value against the US dollar in the last year.

The Yemeni riyal traded at 800 riyals to the dollar on Monday.

For nearly three years, a Saudi-led coalition – which today only includes Saudi and the United Arab Emirates – has embarked on a bombing campaign in Yemen aimed at dislodging Houthi rebels who control capital, Sanaa, and much of the north, as well as restoring to power the internationally recognised government of exiled President Abd-Rabbu Mansour Hadi.

The Yemeni government controls the south, where its central bank is located.

The conflict in Yemen, the Arab world’s poorest nation, is having a devastating effect, leaving millions in need of humanitarian assistance and causing a major cholera outbreak.

As war rages, prices have skyrocketed and millions of people are struggling to access basic necessities such as food, water and fuel.

The fighting has killed more than 10,000 people and pushed Yemen to the brink of famine as food prices continue to soar.

Last month, an attempt by the United Nations to bring the warring sides in Yemen to the table failed after the Houthi rebels did not make it to Geneva, blaming travel restrictions.

UN Special Envoy to Yemen, Martin Griffiths, said he is hopeful of a new round of talks.

Meanwhile, Yemen’s foreign minister said his government is willing to recognise the Houthis as a political entity.

Source: Al Jazeera, News Agencies