Yemen..Historic collapse of the national currency in government-controlled areas and an economic journalist explains the roots of the problem

Today, Wednesday, the Yemeni riyal recorded a historic collapse against foreign currencies, approaching the 2,250 barrier for selling one dollar in the unofficial exchange markets in the temporary capital, Aden, and the rest of the cities under the influence of the internationally recognized Yemeni government.

Banking sources said that the sale of one US dollar reached 2,249 riyals in exchange shops in Aden and the rest of the liberated cities, with a difference of 21 riyals from the purchase.

The sources added that the selling price of the Saudi riyal - the most popular foreign currency - reached 588 riyals, while the buying exchange rate reached 584 riyals.

Commenting on the ongoing collapse of the currency, economic journalist Wafiq Saleh said that the root of the problem in the worsening exchange rate crisis in the local market and the instability of the currency "lies in the absence of government treatments to cover the deficit in the state's public finances and the lack of control over the monetary system currently in effect."

He added, explaining in a post on the X platform: “That is, the government’s financial policies, which were supposed to be the spearhead to confront imbalances and overcome challenges, are still suspended, and there does not appear to be any vision or strategy for the government to activate them currently and work according to sound scientific foundations and rational policies.”

He added that "the policies followed and adopted to manage the monetary system and foreign exchange market activities by the monetary authorities are still proceeding unilaterally, lacking consistency and harmony with government policies, which give them effective impact and influence on reality."

Saleh pointed out that "the banking division that is taking place helps speculators and the black market to benefit from the monetary system followed in managing banking activity, and enables them to continuously manipulate the value of the national currency."

The root of the problem in the exacerbation of the exchange rate crisis in the local market and the instability of the currency lies in the absence of government treatments to cover the deficit in the state’s public finances and the lack of control over the monetary system in effect at the present time.

That is, the government’s financial policies, which were supposed to be the spearhead to confront…

— Wafeeq Saleh (@wafeeqpress) February 4, 2025