Signs of a New Currency Collapse in Government-Controlled Areas… Liquidity Shortage Disrupts Markets as Saudi Support Pledges Recede

NYN | Reports and Analyses 

Areas under the control of the internationally recognized government, foremost among them Aden, are witnessing accelerating signs of a new monetary crisis. This comes amid a growing shortage of local liquidity and the imposition of unprecedented restrictions on withdrawals and transfers, while questions mount over the fate of recent Saudi financial pledges.

A Severe Liquidity Crisis

An economic report published by Al-Araby Al-Jadeed indicated that the liquidity crisis has significantly worsened in Aden and several southern governorates. Citizens are facing increasing difficulty in obtaining Yemeni riyals, despite the currency’s continued collapse against foreign currencies.

According to the report, obtaining local currency has turned into what resembles a “daily search mission,” whereas the focus in the past had been on securing foreign currency. This shift reflects a deep imbalance in the monetary cycle within government-controlled areas.

Strict Restrictions on Transfers

Banking sources stated that exchange companies have imposed a daily withdrawal limit not exceeding 100 Saudi riyals or 50 US dollars per person. In addition, electronic money applications have set a maximum daily limit of 200 Saudi riyals per account. Observers say these measures aim to curb the depletion of remaining liquidity.

Economic experts believe these steps reflect the scale of pressure facing the monetary market, amid declining confidence in the banking sector and ongoing currency speculation.

Questions Over Saudi Pledges

These developments come shortly after Saudi Arabia announced economic support pledges to the government, following political tensions with the United Arab Emirates over influence arrangements in southern Yemen.

Riyadh had reaffirmed its support for the Presidential Leadership Council, headed by Rashad Al-Alimi, pledging to address economic imbalances. However, current indicators on the ground suggest—according to observers—that these pledges have yet to translate into tangible impact.

Some analysts argue that Riyadh’s priorities may extend beyond the economic file, given ongoing regional tensions, leaving the government to confront escalating financial challenges without clear solutions.

Fears of a New Wave of Deterioration

Economists warn that continued monetary restrictions and the shortage of local currency could trigger a new wave of exchange rate deterioration, directly affecting the prices of essential goods and services and worsening living conditions for citizens.

In the absence of urgent rescue measures, markets remain in a state of cautious anticipation, while the trust gap between the public and financial authorities widens, amid growing questions about the government’s ability to contain a crisis that appears poised to become even more complex in the coming weeks.