Houthi-Linked Financial Entities Trigger Cash Crisis

A Yemeni worker counting money in a currency exchange store in Sanaa (EPA)
A Yemeni worker counting money in a currency exchange store in Sanaa (EPA)
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Houthi-Linked Financial Entities Trigger Cash Crisis

A Yemeni worker counting money in a currency exchange store in Sanaa (EPA)
A Yemeni worker counting money in a currency exchange store in Sanaa (EPA)

Mahmoud Naji, a Sanaa-based Yemeni citizen, was told by a currency exchange employee that he had to collect a financial transfer from his brother in Yemeni riyals due to a lack of foreign currency liquidity.

He did not fully comprehend what had happened until he randomly checked four different stores. Naji then realized that there was an unannounced liquidity crisis.

After waiting for a week, Naji told Asharq Al-Awsat that he had to rely on a friend's intervention with a currency exchange company to receive the transfer.

The problem is not restricted to the shortage of liquid hard currency, but it also applies to the local currency, with all denominations missing except for 1,000 Yemeni riyals.

Also, Naji said he has not been given a reason for why currency exchange companies lowered the rate of the US dollar from 600 Yemeni riyals per dollar to around 500 riyals. He noted that exchange stores purchase the dollar at this extremely low rate but refuse to sell at the same price.

Economic sources in Sanaa confirmed to Asharq Al-Awsat that the so-called “economic committee,” which is the parallel entity established by the Houthis for all financial and banking institutions and led by Hassan Al-Saadi, is contributing to the manipulation of the US dollar exchange rate.

According to sources, the real price of one US dollar exceeds 1200 Yemeni riyals, but the Houthi committee, which controls the exchange sector and holds traders’ money at the central bank branch, is imposing a different price.

The war ignited by the Houthis has led to the collapse of Yemen's economy and the shutdown of most companies. As a result, most Yemeni families rely on remittances from Yemeni expats, particularly the three million who work in Saudi Arabia.

Many families have been impacted by the manipulation of exchange companies with the dollar rate, in collusion with the Houthis.

Sources believe the goal is to withdraw as much hard currency as possible from the population ahead of a potential peace stage, where experts expect the dollar price to double in Houthi-run areas, where the current price is believed to be made artificially low.



Lebanon Elects Army Chief as New President

The Lebanese Parliament building a day before a session to elect the Lebanese president, in Beirut, Lebanon, 08 January 2025. (EPA)
The Lebanese Parliament building a day before a session to elect the Lebanese president, in Beirut, Lebanon, 08 January 2025. (EPA)
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Lebanon Elects Army Chief as New President

The Lebanese Parliament building a day before a session to elect the Lebanese president, in Beirut, Lebanon, 08 January 2025. (EPA)
The Lebanese Parliament building a day before a session to elect the Lebanese president, in Beirut, Lebanon, 08 January 2025. (EPA)

Lebanon's parliament elected army chief Joseph Aoun head of state on Thursday, filling the vacant presidency with a general who enjoys US approval and showing the diminished sway of the Iran-backed Hezbollah group after its devastating war with Israel.
The outcome reflected shifts in the power balance in Lebanon and the wider Middle East, with Hezbollah badly pummelled from last year's war, and its Syrian ally Bashar al-Assad toppled in December.
The presidency, reserved for a Maronite Christian in Lebanon's sectarian power-sharing system, has been vacant since Michel Aoun's term ended in October 2022, with deeply divided factions unable to agree on a candidate able to win enough votes in the 128-seat parliament.
Aoun fell short of the 86 votes needed in a first round vote, but crossed the threshold with 99 votes in a second round, according to Parliament Speaker Nabih Berri, after lawmakers from Hezbollah and its Shiite ally the Amal Movement backed him.
Momentum built behind Aoun on Wednesday as Hezbollah's long preferred candidate, Suleiman Franjieh, withdrew and declared support for the army commander, and as French envoy shuttled around Beirut, urging his election in meetings with politicians, three Lebanese political sources said.
Aoun's election is a first step towards reviving government institutions in a country which has had neither a head of state nor a fully empowered cabinet since Aoun left office.
Lebanon, its economy still reeling from a devastating financial collapse in 2019, is in dire need of international support to rebuild from the war, which the World Bank estimates cost the country $8.5 billion.
Lebanon's system of government requires the new president to convene consultations with lawmakers to nominate a Sunni Muslim prime minister to form a new cabinet, a process that can often be protracted as factions barter over ministerial portfolios.
Aoun has a key role in shoring up a ceasefire between Hezbollah and Israel which was brokered by Washington and Paris in November. The terms require the Lebanese military to deploy into south Lebanon as Israeli troops and Hezbollah withdraw forces.
Aoun, 60, has been commander of the Lebanese army since 2017.