Protests erupt in Yemen as currency continues to slide | News | DW | 02.09.2018
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Protests erupt in Yemen as currency continues to slide

Demonstrators have blocked main roads in several Yemeni cities in protest against a fall in the local currency and rise in food and fuel prices. Peace talks this week don't raise much hope of resolving the impasse.

Demonstrators protesting against rising prices and a collapsing currency blocked major roads and burned tyres in the southern Yemeni city of Aden on Sunday.

Protesters also blocked roads in the cities of Mualla, Sheikh Othman, Al Mansoora, Khormaksar, Al-Shab and Brega, the Turkish news agency Anadolu Agency reported. Similar demonstrations are expected in other Yemeni provinces, it added.

The Yemeni riyal has plunged against foreign currencies in the last month, a dollar now worth 600 riyals on official markets, down from 513 riyals in mid-August and from about 250 when the civil war started in 2015. Food and fuel prices have increased up to threefold and are out of reach for most people.

Jemen | Proteste in Aden (Reuters/F. Saliman)

Protesters block a street in Aden with burning tires after the Yemeni rial plunged against foreign currencies

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The UN has already warned that Yemen is facing one of the deadliest famines of modern times as the civil war between the internationally recognized government, based in the south and backed by Saudi Arabia, and the Iran-aligned Houthi movement, which controls the north including the capital Sanaa drags on.

The conflict is widely seen as a proxy war between Riyadh and Tehran.

Fuelling the crisis

Houthi militias have regularly increased gas prices in areas under their control, including in Sanaa. They say this is in retaliation for the central bank's aim of stabilizing the plummeting currency.

 Saudi Arabia deposited $2 billion (€1.73 billion) in Yemen's central bank in January to shore up the rial and finance the government in its fight with the Houthis.

The government, in turn, accuses the Houthis of failing to turn in their revenues to the central bank, estimated at 45 billion riyals ($113 million).

The authorities have also boosted liquidity by printing money, but the rial plunged from 250 to the dollar to 350 after the first newly printed notes rolled out last year.

An official of Yemen's Central Bank Fadhl Abass told MintPress that moving the central bank to Aden, the cessation of oil exports, and targeting economic facilities were among the factors contributing to the collapse of the rial.

Added to this, the central bank struggles to pay public sector salaries as foreign exchange reserves dwindle.

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No peace talks

The warring parties will not meet face-to-face at UN-brokered peace talks in Geneva this week, government officials said on Sunday. The UN has invited Yemen's government and the Iran-backed Houthi rebels to Geneva for talks starting on Thursday.

The talks will also focus on the economy in Yemen, long the Arab world's most impoverished country.

jbh/rc (Reuters, AFP)

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