Aden – An illiquidity problem has surfaced in Yemen, especially in the liberated governorates. According to economic advisor Khalid Abdul Wahed Naaman, the crisis is due to the fact that insurgents are accumulating national currency outside of the banking systems.
Naaman told Asharq Al-Awsat newspaper that militias are storing liquidity to overcome military expenses. He added that the insurgents realize that during the upcoming months, funds will decrease thus making it impossible for them to withdraw more money.
He added that depositories are panicking that banks are not able to fulfill their commitments, which made them save money anywhere apart from banks.
He explained that this had caused shortage in banks’ liquidity, exchange companies and in the Central Bank.
The economic consultant said that money is currently being kept inside homes.
Locals of Aden, Lahij, Dhale, Abyan, and Shabwah governorates told Asharq Al-Awsat newspaper that post offices and exchange companies are suffering from insufficient local cash liquidity.
They added that this led to catastrophic repercussions especially to those who depend on money transfers from relatives living abroad in Gulf, European, and American countries.
In addition, the locals reported that they haven’t received their pensions or salaries from the post offices since Eid al-Fitr.
They explained that the alarming crisis started this year and they would go for days or sometimes weeks to the post office and they won’t be able to receive their partly sums of salaries.
Locals also told Asharq Al-Awsat that the problem had recently spread to exchange companies that no longer have local and foreign cash.
According to the locals, exchange companies resorted then to denying giving them currency sent from their relatives outside the country.