FAO: Yemeni Rial Loses Quarter of its Value in Government-Controlled Areas, Driving Food and Fuel Prices to Record Highs
NYN | Reports and analyses
The market and trade bulletin issued by the Food and Agriculture Organization of the United Nations (FAO – Yemen) reported that the Yemeni rial in government-controlled areas lost a quarter of its value in October, leading to record-breaking price increases in essential goods like food and fuel, beyond the purchasing power of citizens.
According to the report, published by the global humanitarian platform ReliefWeb, the Yemeni rial depreciated by 25% against the dollar on an annual basis and by 36% compared to the average of the past three years. The report attributes this decline primarily to depleted foreign exchange reserves, exacerbated by the ongoing financial crisis, significantly impacting food prices, which saw substantial increases in September. Food prices rose by between 7% and 28% compared to the same month last year, and by 23% to 54% compared to the three-year average.
The report detailed that the cost of the basic food basket in government-controlled areas rose by 2% on a monthly basis, 18% annually, and 35% compared to the three-year average. Specific governorates experienced sharp increases, with prices in Marib and Taiz rising by 27%, Hadhramaut by 17-25%, Al Mahrah by 25%, Shabwah by 24%, and Lahj by 17%.
Regarding fuel, the FAO report indicated that diesel prices increased by 5% in September compared to the previous month, while prices rose by 13% compared to the same period last year and by 45% when compared to the three-year average. These increases were attributed to the severe devaluation of the local currency and a decrease in import volumes through Aden Port, one of the primary entry points for essential goods into the country.
The report also highlighted a significant increase in livestock prices in government-controlled areas. Market prices for young goats and sheep aged between 6 and 12 months rose by 1-3% in September, in contrast to a decline of 2-3% in these prices in Sana’a-controlled areas. Additionally, the report noted that small livestock prices surged by 30% compared to the same month last year and by 52-70% compared to the three-year average. Meanwhile, prices in Sana’a-controlled areas remained relatively stable or showed a slight decline of 2%.
The report concluded by noting a sharp decline in the purchasing power of households in government-controlled areas, as the cost of the minimum food basket exceeded citizens’ income levels. Additionally, wages for temporary labor, both agricultural and non-agricultural, remained unchanged compared to the previous month across government-controlled areas.
