UN Warns…”Legitimacy” Ends Hope of Currency Recovery with New Shipment to Hadramaut
United Nations warned on Tuesday, from “catastrophic” repercussions as a result of the continuous collapse of currency and its great repercussions on the rise in food prices in areas controlled by the government of the outgoing President Abd Rabbuh Hadi.
This comes at a time the dollar crossed the thousand riyals barrier for the first time in its history, amid the continuing flood with new printed currency to local market without cash cover.
World Food Program revealed that food prices in Hadi government-controlled areas increased by 33%, expecting, in a tweet on its official page, a further deterioration.
The prices of basic materials have risen significantly in the past two trading days, where the price of flour reached 30 thousand riyals, compared to 16 thousand in “Houthis” areas.
This rise coincided with a sudden collapse of exchange rates in the “legitimacy” areas, where the dollar recorded 1007 riyals in the transactions of the past hours.
In the context, the head of the exchangers association in Aden, Subhi Bagafar, explained in a press statement, the reasons of the currency sudden collapse, indicating that it was caused by a lack of liquidity in foreign currencies, to confirm earlier reports that Hadi family had withdrawn huge amounts of hard currency from accounts with companies and banks in Aden, and transferred it through Ukrainian and Azerbaijani companies to Turkey, in fear from STC to repeat the scenario of seizing his account as it happened in Sana’a.
On the same level, Hadi government continued at a high rate to flood the local market with more money printed abroad, whereas, banking sources in Hadhramaut Central reported that 14 containers had arrived at the port of Mukalla loaded with new printed currency, in a move that could further deteriorate the currency in the areas of “legitimacy.”
The Supreme Economic Committee in Sana’a had revealed that Hadi government had distributed huge sums of money arrived at Seiyun Airport without being registered in any of the Central Bank branches, which indicates to a scheme that eliminate the rest of local currency value, within the scenario of the economic war that began with the transfer of the Central Bank from Sana’a.