The Economic Escalation in Yemen: Consequences and Future Predictions

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Several local and international factors, including events, have laid the foundation for the Central Bank of Yemen to make a series of significant and decisive decisions regarding the country’s financial and banking sector. Among these factors is the continued implementation of new measures by the Houthis, targeting the finances of the legitimate, internationally recognized government, as well as the aforementioned financial and banking sectors. These measures have been particularly frequent since the signing of the so-called “Armistice Agreement” on April 2, 2022. The Houthis announced the issuance of a Yemeni 100-riyal coin, which was to enter circulation starting March 31, 2024. Additional geopolitical and security factors include the local classification of the Houthis as a “terrorist group” in October 2022 and the United States’ decision to also designate them as a “terrorist group” following the events in the Red Sea in mid-February 2024. This U.S. designation comes after President Joe Biden’s administration had previously removed the Houthis from the terrorist list in February 2021,,.

This paper aims to present an overview of the decisions made by the Central Bank of Yemen and the measures enacted by the Houthis. It analyzes the factors contributing to the escalation in the economic and financial sectors and anticipates possible future developments and their broader impact on the economic situation.


The Houthi militia announces the issuance of a 100-riyal coin,, on: 3/30/2024, available at the following link:
 The National Defense Council classifies the Houthi militia as a terrorist organization and warns against dealing with it, Presidency of the Council of Ministers, on: 10/22/2022, available at the following link:
 Terrorist Designation of the Houthis, US Department of State, dated: 1/17/2024, available at the following link:
 Revocation of the Terrorist Designations of Ansarallah, U.S. Department of State, on: 2/12/2021, available at the following link:  Washington: The classification of the Houthis as a “terrorist organization” comes into effect, Anadolu Agency, on: 2/17/2024, available at the following link:
 See: The Houthis protest in Sana’a to demand the overthrow of the government, France 24, on: 8/18/2014,
available at the following link:
The Yemeni Central Bank … an economic battle against the Houthis, Al-Jazeera, on: 8/23/2016, available at the following link:
 Yemeni Economic Bulletin: The war for monetary control is entering a dangerous new phase, Sana’a Center for Strategic Studies, on: 1/21/2020, available at the following link:

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