Yemeni riyal in free fall again amid political deadlock

The riyal was 215 to the dollar when the Houthis placed the Yemeni President Abed Rabbo Mansour Hadi under house arrest in early 2019. (Shutterstock)
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Updated 30 May 2021
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Yemeni riyal in free fall again amid political deadlock

  • Trades at 930 to dollar in government-controlled areas, plunging from 900 riyals 2 weeks ago
  • Experts link the current fall of the riyal to the outcome of UN-brokered peace efforts

AL-MUKALLA: Yemen’s riyal hit a new record low on the weekend amid deadlocked diplomatic efforts to end the war and rising tensions between the Yemeni government and southern separatists in Aden. 

The riyal traded at 930 to the dollar on Saturday in the government-controlled areas, plunging from 900 riyals a couple of weeks ago. 

The riyal was 215 to the dollar when the Houthis placed the Yemeni President Abed Rabbo Mansour Hadi under house arrest in early 2019, sparking the current conflict.

When the new unity government, formed under the Riyadh Agreement in December, returned to Aden as troops withdrew from Abyan, the Yemeni riyal surged to 720 against the US dollar, recovering almost 20 percent of its value. 

Experts link the current fall of the riyal to the outcome of UN-brokered peace efforts, renewed hostilities between the Yemeni government and the separatist Southern Transitional Council (STC), and the government’s failure to resume oil exports and collecting revenues from state bodies.

“The fall of the riyal is due to the economic and political instability in Yemen,” Mustafa Nasr, director of the Economic Media Center, told Arab News on Saturday. 

Politically, the UN Yemen envoy Martin Griffiths’ latest diplomatic shuttle between Riyadh and Muscat yielded no fruit as warring factions rejected his peace initiative, known as the Joint Declaration, that proposes putting into place a nationwide truce. 

The Houthis are still pressing ahead with their deadly offensive on the central city of Marib despite international condemnations and appeals. 

In Aden, the interim capital of Yemen, the internationally recognized government has not returned to the city for more than two months amid reports about renewed tension with the STC. 

The STC on Saturday appointed Gen. Shalal Ali-Shayae as the commander of counterterrorism forces in Aden, fueling tension with the government whose supporters accused the separatists of violating the Riyadh Agreement. 

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The STC on Saturday appointed Gen. Shalal Ali-Shayae as the commander of counterterrorism forces in Aden, fueling tension with the government whose supporters accused the separatists of violating the Riyadh Agreement.

Shayae, former security chief of Aden and a senior separatist figure, was appointed in December as a military attache at the Yemen Embassy in the UAE. 

“The implantation of the Riyadh Agreement (in December) sent positive signals about new economic policies and support to the economy,” Nasr said, adding that the Yemeni riyal plunged again after the government did not remain in Aden or apply reforms to boost revenues and exports. 

“Many negative things have happened recently. The crisis in Aden returned. The government neither improved revenues that generate hard currencies nor created a mechanism for covering exports of goods and fuel. To pay public servants, the government printed millions of riyals without coverage,” he said. 

During previous rounds of devaluation of the national currency, the Yemeni government replaced the central bank governors, shut down exchange firms to put an end to currency speculation, and provided local fuel and goods traders with the dollar. 

The government also floated the riyal to bridge the gap between the official rate and that of the black market and relocated the central bank office from Sanaa to Aden. 

The Yemeni government blamed the Houthis for banning the use of new banknotes printed by the Yemeni government in Aden and refusing to deposit revenues from Hodeidah seaports and tax into the central bank in Aden. 

Economists argue that the Yemeni riyal would keep falling against the dollar as long as the Yemeni government remains outside the country.

The depreciation of the riyal has led to an expected surge in the price of foods and fuel and sparked protests in several Yemeni cities. 

Hundreds of people took to the streets of Aden and Taiz to voice rage over the collapse of the Yemeni currency and the subsequent increase in the price of food and goods. 

“My salary has lost more than 20 percent of its value due to the devaluation of the riyal. My relatives in Saudi Arabia donate to me to keep me afloat since my salary can’t cover my expenses,” Abu Abdullah, a government employee, told Arab News.


US defense chief holds first call with new Israeli counterpart

Updated 55 min 59 sec ago
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US defense chief holds first call with new Israeli counterpart

  • Katz was sworn in before parliament the previous day
  • The US defense chief also discussed “the need to improve the dire humanitarian conditions in Gaza“

WASHINGTON: US Defense Secretary Lloyd Austin discussed Lebanon and Gaza on Friday in his first call with his new Israeli counterpart Israel Katz, the Pentagon said.
Katz was sworn in before parliament the previous day, after his predecessor’s shock dismissal by the prime minister over a breakdown in trust during the war in Gaza — a conflict that began with a devastating Hamas attack against Israel on October 7, 2023.
Austin “held an introductory call today with the new Israeli minister of defense, Israel Katz, and congratulated him on his recent appointment,” Pentagon spokesman Major General Pat Ryder said in a statement.
He told Katz that Washington is committed to a deal that allows Lebanese and Israeli citizens displaced by more than a year of cross-border violence to return to their homes, as well as to the return of hostages seized by Palestinian militant group Hamas, Ryder said.
The US defense chief also discussed “the need to improve the dire humanitarian conditions in Gaza,” after he and Secretary of State Antony Blinken told Israel in a letter earlier this month that it needed to allow more aid into the small war-wracked coastal territory.


Palestinian leader tells Trump ready to work for Gaza peace

Mahmud Abbas told Donald Trump he was ready to work toward a “just and comprehensive peace” in Gaza. (Reuters)
Updated 56 min 46 sec ago
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Palestinian leader tells Trump ready to work for Gaza peace

RAMALLAH: Palestinian president Mahmud Abbas expressed readiness to work toward a “just and comprehensive peace” in Gaza during a phone call with US President-elect Donald Trump on Friday, his office said.
Trump’s victory came with the Middle East in turmoil after the outbreak of the Gaza war in October 2023, triggered by the unprecedented attack on Israel by Palestinian militant group Hamas.
Congratulating Trump on his victory, Abbas expressed “readiness to work with President Trump to achieve a just and comprehensive peace based on international legitimacy,” his office said in a statement.
It said that Trump also assured Abbas that he will work to end the war.
“President Trump stressed that he will work to stop the war, and his readiness to work with president Abbas and the concerned parties in the region and the world to make peace in the region.”
While Trump struck a note of peace during his campaign, he also touted his status as Israel’s strongest ally, even going so far as to promise Prime Minister Benjamin Netanyahu he would “finish the job” against Hamas in Gaza.


Lebanon says three dead in Israel strikes on Tyre

Updated 08 November 2024
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Lebanon says three dead in Israel strikes on Tyre

  • The strikes targeted three buildings in the city
  • Israel had issued no evacuation warning ahead of the strikes

BEIRUT: The Lebanese health ministry said at least three people were killed and 30 others wounded on Friday in Israeli strikes on the southern city of Tyre.
The official National News Agency said the strikes targeted three buildings in the city and caused heavy damage to neighboring apartment blocks.
It said Israel had issued no evacuation warning ahead of the strikes.
Israel has been at war with Lebanese militant group Hezbollah since late September, when it broadened its focus from fighting Hamas in the Gaza Strip to securing its northern border, even as the Gaza war continues.
Hezbollah began low intensity strikes on Israel in support of Hamas following its Palestinian ally’s October 7, 2023 attack on Israel which triggered the Gaza war.


‘Strong likelihood’ famine imminent in north Gaza, say food security experts

Updated 08 November 2024
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‘Strong likelihood’ famine imminent in north Gaza, say food security experts

  • The warning comes just days ahead of a US deadline for Israel to improve the humanitarian situation in Gaza

LONDON: There is a “strong likelihood that famine is imminent in areas” of the northern Gaza Strip, a committee of global food security experts warned on Friday, as Israel pursues a military offensive against Palestinian militants Hamas in the area.
“Immediate action, within days not weeks, is required from all actors who are directly taking part in the conflict, or have influence on its conduct, to avert and alleviate this catastrophic situation,” the independent Famine Review Committee (FRC) said in a rare alert.
The warning comes just days ahead of a US deadline for Israel to improve the humanitarian situation in Gaza or face potential restrictions on US military aid.


Israeli army claims discovery of ‘Hezbollah training center’ near UNIFIL outpost as raids continue in Lebanon

Updated 08 November 2024
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Israeli army claims discovery of ‘Hezbollah training center’ near UNIFIL outpost as raids continue in Lebanon

  • Several videos showed residential houses and tourist, social and religious facilities being set with explosives and blown up remotely
  • Adraee also accused Hezbollah of “using ambulances to transport saboteurs and arms” and called on “medical personnel to avoid dealing and cooperating with Hezbollah members”

BEIRUT: The Israeli army on Friday continued to destroy houses in Lebanon’s southern border villages to establish a buffer zone. The latest bombing targeted the areas of Yaroun, Aitaroun and Maroun Al-Ras in Bint Jbeil.
Several videos showed residential houses and tourist, social and religious facilities being set with explosives and blown up remotely.
In parallel with the deliberate destruction, Israeli army spokesperson Avichay Adraee issued “a new urgent warning to the residents of southern Lebanon,” instructing them “to refrain from returning to the south, or to their houses or olive fields,” describing the region as “a dangerous combat zone.”
Adraee also accused Hezbollah of “using ambulances to transport saboteurs and arms” and called on “medical personnel to avoid dealing and cooperating with Hezbollah members.”
The army will take the “necessary measures against any vehicle transporting armed members regardless of its type,” he said.
Meanwhile, the Israeli army claimed that “surveillance cameras of the Oded Brigade reservists captured a Hezbollah training center just 200 meters from a UNIFIL outpost.”
The army claimed that “the forces discovered the training facility, which was used by Hezbollah for training, studying, and storing large quantities of weapons.”
It said that “the facility contained missile launchers used for firing at Israeli settlements, as well as documents and instructional books detailing Hezbollah’s operational methods, maps of Israel, explanations of the Israeli army’s equipment, and additional weapons.” The army said “the weapons were confiscated and the compound was dismantled.”
The Israeli army resumed raids on the Baalbek-Hermel area, killing and injuring people and causing further destruction.
The Ministerial Emergency Committee estimated that, as of Thursday evening, Israel had conducted 121 raids, including 56 on Nabatieh, 24 on Baalbek and 23 in the south.
The committee said the number of people killed so far in Israeli attacks on Lebanon exceed 3,100, while 14,000 people have been injured.
More than 1.2 million people have been displaced, with close to 200,000 staying in shelters, it added.
Lebanese observers believe this transitional phase, from now until US President-elect Donald Trump’s inauguration, is the most dangerous period for Lebanon.
Raids on Kfar Tebnit killed two people after a building comprising residential apartments and commercial shops was destroyed.
A raid on Zebdine in Nabatieh killed Mohammed Fayez Mokaddam and his sons, Fayez and Hadi Mokaddem, after their building was destroyed.
Zaher Ibrahim Ataya, a medic with Hezbollah’s Islamic Health Committee from the southern town of Tair Harfa, was killed when Israeli forces struck a newly established medical center.
The strike was part of a broader Israeli aerial campaign that targeted more than 50 towns across the Tyre and Bint Jbeil districts in the past 48 hours.
The Lebanese Red Cross chief Georges Kettaneh announced that rescue teams have returned to Wata Al-Khiyam to complete the recovery of victims from an incident on Oct. 27.
Working alongside UNIFIL forces and the Lebanese Army, teams recovered four bodies and remains, with efforts continuing to ensure the mission’s completion.
Earlier the Red Cross retrieved 17 bodies from the site where civilians, who had been tending to livestock, sought shelter in a building during an Israeli incursion.
The Israeli military initially stalled permission for the Lebanese Red Cross to recover the victims, eventually granting only a four-hour window for the operation.
The Israeli air campaign extended to Lebanon’s Bekaa region, with strikes hitting Hrabta town west of Baalbek and Hosh Al-Sayyed Ali near the Syrian border north of Hermel.
Sirens sounded across northern Israel, including Haifa, Nazareth, Kiryat Shmona and surrounding areas, as well as the Ramat Trump settlement in the Golan Heights and Israeli media reported approximately 30 rockets launched from Lebanon toward northern Israel and Haifa’s suburbs.
The Israeli military confirmed detecting about 20 rockets, with some being intercepted, and reported drone incursions in northern airspace, including one near Caesarea.
The Israeli military announced the death of a soldier from Battalion 8207, Alon Brigade (228), who succumbed to wounds sustained in southern Lebanon on Oct. 26, while Israeli army radio detailed a fierce battle in the border village of Aitaroun that claimed the lives of six Israeli soldiers.
Hezbollah said on Friday it had launched “dozens of rockets reaching as far as Haifa and south of Nazareth.”
The group claimed strikes on several targets, including the Stella Maris naval base and Ramat David air base, northwest and southeast of Haifa, respectively, Kiryat Shmona settlement, and military gatherings in Misgav Am and Margaliot settlements.
In response to Israeli infiltration attempts, Hezbollah reported targeting Israeli forces south of Adaisseh with artillery fire. The group also claimed to have destroyed a military bulldozer and inflicting casualties on accompanying infantry forces trying to advance northwest of Kfarkila.