Yemen central bank expects $3 billion deposits from Gulf

Yemen’s central bank expects a $3 billion cash injection from Gulf allies Kuwait and the United Arab Emirates, an official said Thursday, as the war-battered country seeks to prop up its sagging economy. The deposits, if confirmed, would follow a $2.2 billion infusion by Saudi Arabia to stem a slide in the Yemeni riyal as the country reels from an economic downturn. “The central bank governor Mohamed Zemam has spoken of additional deposits worth $3 billion after talks with sisterly donor countries,” deputy central bank chief Shokeib Hobeishy told reporters in the port city of Aden.

“I believe two (billion) will come from the UAE... and another billion from Kuwait.” There was no immediate comment from the Gulf nations. A day earlier, Yemeni Prime Minister Moeen Abdulmalik Saeed had declined to name the potential donors, saying he would not give out details until the expected injection is confirmed. “There are ongoing discussions about the efficiency of the central bank to handle these deposits,” he told reporters on Wednesday.

The central bank, whose headquarters were moved to Aden in 2016 from capital Sanaa, has struggled to pay government salaries and revive the war-battered economy. Saudi Arabia, which leads a coalition supporting the beleaguered government in its fight against Houthi, deposited $200 million in Yemen’s central bank in October. The oil-rich kingdom also deposited $2 billion in the central bank in January to boost the currency.

The riyal has lost more than two-thirds of its value against the dollar since 2015, when Saudi Arabia and its allies joined the government’s fight against Yemen’s Huthi rebels. It has made a partial recovery in recent weeks, but the weakened currency has left many unable to afford food staples in a nation where 14 million people are at risk of famine.