Acute cash shortage hits southern, eastern Yemen

ADEN, Feb. 24 (YPA) -Residents in southern and eastern Yemen are facing a severe liquidity crisis in the local currency, exacerbating already dire economic conditions.

Local sources in the port city of Aden reported that exchange shops have begun refusing to convert more than 100 Saudi riyals per transaction due to a shortage of Yemeni banknotes in circulation.

According to the sources,  many people suspect the cash shortage may have been deliberately engineered by certain actors, especially against the backdrop of ongoing friction between Saudi Arabia and United Arab Emirates in southern and eastern Yemen.

Despite the internationally recognized government—previously aligned with the Saudi-led coalition—printing more than five trillion Yemeni riyals since 2018, observers say it remains unclear how the government and the Central Bank in Aden plan to address the worsening cash shortage.

It remains unclear whether the Central Bank of Yemen in Aden will inject additional local currency into the market, and whether such a move could trigger a further decline in the value of the currency circulating in areas of southern and eastern Yemen under Saudi control.

Critics attribute these concerns to what they describe as a lack of transparency and inconsistent economic and monetary policies pursued by governments appointed from outside the country.

Citizens are questioning where the vast sums of currency printed beyond actual demand have gone, as the country faces a crippling cash shortage. They struggle to understand how such large-scale monetary expansion has resulted in a liquidity crisis.

Many say they are paying the price for erratic government policies — first through the printing of unbacked money that fueled currency depreciation, poverty and hunger, and now through a shortage that has left people in southern and eastern Yemen with little to show but continued hardship.

@E.Y.M