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Yemen’s CBY Announces Emergency Action Plan

Yemen’s CBY Announces Emergency Action Plan

Monday, 25 March, 2019 - 09:00
A Yemeni woman holds onto YER (AFP/FILE)
Aden, Sanaa- Asharq Al-Awsat
The Central Bank of Yemen (CBY) announced it will enforce an emergency monetary policy, which will be discussed with currency exchange market magnates to stop the Yemeni rial from further depreciation.

CBY’s decision was met with Houthi militias opposition, with the Iran-backed group directing its personnel overrunning the bank’s Sanaa headquarter to prohibit dealing with the newly-printed banknotes. The government had issued fresh 1,000, 500, 200 and 100 Yemeni riyal bills to make up for the liquidity squeeze caused by Houthis ransacking about two trillion riyals of CBY’s currency reserves in Sanaa.

In an effort to stabilize the Yemeni riyal and cover the country’s imports, which are seen as vital for improving the war-ridden country’s collapsing economy and the living conditions of Yemenis, CBY said it will immediately begin implementing an emergency currency intervention.

Firstly, the CBY officials will convene with the boards of directors of all money exchange companies operating in Aden. Meetings with each company will be held separately, the CBY statement informed.

During meetings, CBY’s plan to manage and control the currency exchange market and the policy on foreign currency intervention will be reviewed.

Violations recorded within the currency exchange market will also be tackled with each company independently. Roadmaps and transcripts will be signed with the companies in preparation to launch commitments that bind them to plans for improving working procedures and combating terror funding.

CBY warned that it would not tolerate any criminal offenses or currency manipulation and would deal with violators decisively.

It is worth noting that this is the first action plan announced by CBY since the appointment of Hafez Fakhir Meyad, advisor to the Yemeni president and head of the economic committee in the presidential office, as the bank's governor, replacing Mohammed Zemam.

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