{"id":12613,"date":"2026-07-17T21:49:39","date_gmt":"2026-07-17T18:49:39","guid":{"rendered":"https:\/\/mokhacenter.org\/?p=12613"},"modified":"2026-07-18T23:48:43","modified_gmt":"2026-07-18T20:48:43","slug":"the-parallel-economy-how-the-houthis-turned-yemens-private-sector-into-a-war-financing-network","status":"publish","type":"post","link":"https:\/\/mokhacenter.org\/en\/the-parallel-economy-how-the-houthis-turned-yemens-private-sector-into-a-war-financing-network\/","title":{"rendered":"The Parallel Economy: \u00a0How the Houthis Turned Yemen\u2019s Private Sector into a War-Financing Network"},"content":{"rendered":"

Executive Summary<\/b><\/span><\/h3>\n

This study examines the transformation of the private sector in areas controlled by the Houthis between 2014 and 2025. It focuses on how the Houthis used markets, trade, and private businesses to build sustainable sources of financing that supported their war economy and strengthened their political, military, and security influence.<\/span><\/p>\n

The analysis draws on nearly 68,000 commercial registration records collected and classified from Houthi-controlled areas, alongside data on trade names and economic establishments. Together, these sources provide a broad information base for tracking company formation, identifying the rise of new commercial networks, and monitoring shifts in market influence during the years of war.<\/span><\/p>\n

The study is further supported by international reports and official documents covering key sectors, including oil and energy, currency exchange and money transfers, pharmaceuticals and medical supplies, general trade, imports, shipping, logistics, construction materials, and contracting. Combining commercial registry data with these sources shows that the growth of new companies was concentrated in the most profitable sectors. This coincided with the expanding influence of companies, traders, and business figures whose economic interests became directly or indirectly linked to the Houthis, while several traditional trading houses that had dominated the market before 2014 saw their influence decline.<\/span><\/p>\n

The data indicates that the Houthis brought the private sector under a financial and commercial system designed to maximize revenues and expand sources of funding. This system included commercial registrations, licenses, taxes, fees, levies, contracts, and commercial privileges, as well as control over imports and supply chains. Revenue collection extended from company registration and licensing to importation, transportation, storage, distribution, and sales. As a result, every stage of commercial activity became a financial channel feeding the war economy, with part of these resources used to finance military and security activities.<\/span><\/p>\n

The distribution of newly established companies shows a concentration in oil and energy, general trade and imports, currency exchange and money transfers, shipping and logistics, and pharmaceuticals and medical supplies. These are among the sectors with the greatest capacity to generate revenue. Companies linked to the Houthis captured a significant share of these activities through privileges and monopolies, while the Houthis secured continuous financial flows through taxes, fees, levies, profits from trade and imports, and logistics services. In this way, markets became one of the main sources of financing for the war economy.<\/span><\/p>\n

International reports link several companies and business networks to import management, financial transfers, control over the fuel trade, and the operation of shipping and logistics networks. They also point to the purchase and transfer of dual-use materials and technologies, some of which were used in military manufacturing programs and in the development of combat capabilities. This highlights the direct connection between commercial activity, financing networks, and the logistical and military needs on which the Houthis relied throughout the war.<\/span><\/p>\n

The findings confirm that the private sector became one of the most important financial pillars of the war economy in Houthi-controlled areas. Markets, companies, and traders provided continuous financial resources through taxes, fees, levies, monopolies, and commercial privileges. These resources helped finance military and security spending, expand networks of influence, and redirect wealth within the market toward companies and business figures linked to the Houthis, while weakening the ability of independent traders to compete.<\/span><\/p>\n

The study concludes that the Houthis succeeded in building an economic network tied to their political and military leadership. This network was based on control over trade, the monopolization of strategic sectors, the capture of financial resources, and the transformation of the private sector into one of the most important sources of war financing.<\/span><\/p>\n

\n
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Executive Summary This study examines the transformation of the private sector in areas controlled by the Houthis between 2014 and 2025. It focuses on how the Houthis used markets, trade, and private businesses to build sustainable sources of financing that supported their war economy and strengthened their political, military, and security influence. The analysis draws …<\/p>\n","protected":false},"author":6,"featured_media":12614,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[965,967],"tags":[917,289,263,811],"class_list":["post-12613","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economic-and-development-studies","category-economic-research-papers","tag-economy","tag-mockha-center","tag-the-houthis","tag-yemen-news"],"yoast_head":"\nThe Parallel Economy: \u00a0How the Houthis Turned Yemen\u2019s Private Sector into a War-Financing Network<\/title>\n<meta name=\"description\" content=\"Executive Summary This study examines the transformation of the private sector in areas controlled by the Houthis between 2014 and 2025. 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